Disease Management 2.0

As skepticism about true cost savings continues to grow, DM shifts its focus beyond chronic disease.

The year 2008 was a rough one for disease management.

High-profile studies questioned whether DM is worth the investment. The DM industry shifted away from chronic disease to a population health model. And most important, the Centers for Medicare & Medicaid Services ended its DM-inspired demonstration pilot called Medicare Health Support. CMS' decision sent shockwaves through DM circles and caused industry giant Healthways' stock to plummet—even before the rest of Wall Street dropped. But does disease management's difficult 2008 mean the industry is headed to the scrap heap along with managed care, HMOs, capitation, and other ideas that have largely fallen out of favor?

Whether DM actually saves money has been a debate since the early days when industry advocates promoted the idea of huge cost savings in DM, some going so far as stating 15:1 and 20:1 return on investment. Medicare Health Support's demise, however, has helped push the argument away from whether DM actually saves money; industry leaders are now pointing to better outcomes and slight savings or budget neutrality.

"What's happening is because the DM industry has lost its ace in the hole, it can't make these claims," says Ariel Linden, DrPH, MS, president of Linden Consulting Group in Hillsboro, OR. "What they are trying to do is get away from the narrowly defined DM concept, which has now been demonstrated not to be financially effective, and move it into areas in which they think there is more opportunity as well as retain their current clients."

Those questions about DM are also leading experts to question the cost-effectiveness of population health. "You have different thought leaders and researchers out there fundamentally questioning whether you could be pursuing an ROI in a health and wellness program," says Brenda R. Motheral, BPharm, MBA, PhD, president of CareScientific LLC, a DM and wellness consulting firm in Brentwood, TN.

Motheral says population health's popularity is on the rise because DM vendors see growth opportunity and employers like the idea of an integrated model that reaches out to all employees—from the healthy to the chronically ill.

"There's a little bit of confusion in the sense that employers are confused and frustrated about what they are getting from disease management. Yet at the same time, they want to move forward and into health and wellness. I think that will still play out over time," says Motheral.

While the old DM model of call center nurses has fallen out of favor, the industry is moving away from that concept and replacing it with one that involves health coaching and technology to help physicians stay current with patients between office visits, such as telemonitoring, says Linden. He adds DM's future is in the low-human touch, high-IT touch care that centers on the physician; that movement is evident in the medical home concept, which is backed by physician groups as well as DM's major advocacy organization, DMAA: The Care Continuum Alliance. Formerly called the Disease Management Association of America, DMAA is another example of the industry's move from chronic disease to population health.

Technology could spark expansion into other areas, too. Deloitte Center for Health Solutions released a report recently that spoke of the synergies between retail pharmacies and DM. Paul H. Keckley, PhD, executive director of the Deloitte Center for Health Solutions, says electronic medical records and personal health records coupled with the IT infrastructure of population-based care management could be a more effective model for DM than ones based on claims data.

"The industry knows that disease management is perceived to be narrowly focused on chronic care, and yet the infrastructure and the business model can be applied to coordination of care across a variety of settings," says Keckley.

So although disease management has faced difficulties in 2008, it's a trend that may be morphing, not vanishing altogether.

"I don't think it's dead at all. I have had a lot of discussions with employers over the past few months. Despite their frustrations with a lot of the current models, they still fundamentally believe disease management is frankly the only hope they have to control their medical costs," says Motheral.

—Les Masterson