Thousands of Wisconsin Medicare recipients were wrongly told their benefits were being cut by $300 and the state has not notified them of the mistake. Even though no one will lose benefits, the state Department of Health Services decided not to notify those affected with a letter and instead is only telling those who call in to complain. Agency spokesman Seth Boffeli said a computer glitch led to 5,000 Medicare recipients wrongly being notified that the state would no longer be paying their benefits.
Millions of older and disabled people could face new restrictions on where they can go for medical equipment under a Medicare plan to overhaul how the federal insurer pays for such devices. Patients have long been able to choose any supplier, and Medicare would buy or rent the equipment based on a set schedule of fees. Now, the government plans to pay for devices sold only by approved suppliers, to be selected by competitive bidding. The change is expected to reduce costs for the government and save money for seniors. But it also may mean new hassles for patients, say suppliers and some patient-advocacy groups.
A couple of years ago, the Institute of Medicine of the National Academies released studies that found at least 1.5 million people are hurt by medication mistakes every year in the United States, costing hospitals about $3.5 billion in additional treatment expenses. But technology companies claim to have a means of lowering these figures, and it's called Business Rule Management System, or BRMS. More and more, companies are looking to inject this type of technology deeper into their business computing systems. A recent example of one successful embrace of BRMS comes from Vanderbilt University Medical Center.
Men are being urged to consider risks before undergoing prostate cancer screening in the wake of two studies that did not produce convincing evidence that routine testing significantly reduces the chance of dying from the disease. The PSA blood test, which millions of men undergo each year, did not lower the death toll from the disease in the first decade of a U.S. government-funded study involving more than 76,000 men, researchers reported.
Consumers that are cutting back on expenses now may continue to do so even after an economic recovery. In response, businesses should be cutting advertising budgets now, Nick Brien, a senior executive of ad firm Interpublic Group, tells Reuters.
Healthcare reform discussions have focused mostly on covering the uninsured, but as Massachusetts has found out, a major reform package without cost controls is simply punting the larger problem.
The Bay State is facing that issue now as health leaders look for ways to control costs that threaten to cripple the reform effort. Massachusetts has discovered that extending coverage to more people is the easy part of healthcare reform—the real problems come when it's time to talk cost controls.
Federal lawmakers are exploring one idea that has been tested in the commercial setting as a way to both cut long-range healthcare costs and improve patient outcomes. Value-based insurance design (VBID) takes quite a different approach than what has become common in these cost-shifting days of high-deductible health plans. The concept of VBID is that lowering medication and service costs for clinically beneficial services for patients with certain chronic illnesses, such as diabetes and hypertension, will remove cost barriers, and improve compliance and patient outcomes.
One example is a health plan that removes copays for evidence-based diabetic drugs. VBID addresses both the objectives of cost containment and quality improvement by promoting fiscally responsible, clinically-sensitive cost sharing.
VBID has been successful in the commercial market. Early pioneers of VBID, such as Marriott and Pitney Bowes, have cut costs to diabetes medications, and achieved positive cost and quality outcomes.
UnitedHealthcare is also testing VBID in the self-insured (large employer) market with its Diabetes Health Plan. Diabetics and pre-diabetics who follow their treatment plans and evidence-based guidelines receive incentives, such as free services and medications, online monitoring, wellness coaches, and self-management programs. VBID has been successful in the commercial setting, but the concept can also have a place in a public program, such as Medicare, says one of the creators of the concept: A. Mark Fendrick, MD, co-director of the University of Michigan's Center for Value-Based Insurance Design in Ann Arbor.
"While there are major initiatives to cut, cut, cut, we have the ability to preserve the baby while throwing out the bathwater of waste and inefficiency," he says about VBID.
Some policymakers agree and are looking at the option for both the Medicare and the Department of Veterans Affairs populations. In fact, Sen. Debbie Stabenow and Congressman John Dingell held a briefing at the Capitol to discuss the concept last month. VBID advocates and policymakers think the concept could be a winner in the Medicare population because of the chronic illness epidemic. Twenty-three percent of Medicare's 26 million beneficiaries have five or more chronic conditions and account for nearly 70% of the program's spending.
Costs can create a barrier to medication compliance for beneficiaries. The Medicare Part D population takes five prescription drugs per day, on average, and nearly 20% of them are not able to fill a prescription or delay filling a prescription because of cost, according to a recent white paper by Avalere Health and the Center for Value-Based Insurance Design at the University of Michigan that analyzed whether VBID could be used within the current Medicare Part D structure.
Policymakers could immediately implement VBID in both Part D, which provides prescription drug benefits coverage of most outpatient drugs, and chronic special needs plans, which cover dual eligibles—those who are institutionalized and have severe or disabling chronic conditions.
Researchers said the two public programs and VBID have the same goal: promote better medication use for beneficiaries with chronic conditions.
They tested five options and found that Medicare could implement three of the options now:
Reduce cost sharing for specific drug or drug classes
Exempt specific drugs or drug classes from 100% cost sharing in the Medicare coverage gap
Reduce cost sharing for chronic special needs plan enrollees based on the plan's target condition
Though the research shows that Medicare could implement VBID, there are still questions as to whether it would work in the senior population. However, the recipe of spiraling costs, a sputtering economy, and the need for major healthcare reform is just the combination that should spark government officials to test VBID in Medicare.
Les Masterson is senior editor of Health Plan Insider. He can be reached at lmasterson@healthleadersmedia.com.Note: You can sign up to receiveHealth Plan Insider, a free weekly e-newsletter designed to bring breaking news and analysis of important developments at health plans and other managed care organizations to your inbox.
Although it may sound optimistic, your organization must be prepared to pounce when the market comes back from the current recession. Here, Harvard Business School marketing professor John Quelch offers seven recommendations for marketers to plan ahead.
The name of the game for many of today's consumers is fast. Look at fast food; the quicker and easier the better! But, of course, they also want quality. When it comes to the ER, patients and consumers have those needs in common. A recent campaign from Catholic Healthcare West, a system with facilities throughout California, Arizona, and Nevada, managed to successfully marry the two concepts in an interesting and unique way.
There was a need in Catholic Healthcare West's regional market. Thirty-minute clinics were popping up and the focus was primarily on door-to-doc time. Needing a way to meet consumer needs as well as to communicate back to the public, Catholic Healthcare West did extensive research and found ways to completely redefine the way its ER was operating.
"We went from three-hour wait times to three minutes," says Paul Szablowski, vice president of marketing, communications, and public relations for Catholic Healthcare West. "What we found is that sometimes we were asking for a patient's name and insurance 10 or 15 times . . . so we streamlined that process from an operational perspective."
Once new procedures were in place and door-to-doc times had been dramatically reduced, a multi-layer campaign was launched to increase patient volumes. "We wanted to take the time to raise consumer awareness before a situation arises," says Szablowski.
The campaign that Catholic Healthcare West launched stressed to the consumer that making a fast choice is important but making a "good choice" is critical. This was done using a unique creative strategy that visually molded the ad's copy to the shape of various fast-food items—stressing the visual association and stressing the meaning of "fast."
"Anyone can guarantee fast service," says Szablowski, "but can you guarantee efficient practice? Shorter wait times are great but we wanted to stress that you should look at the depth of specialty as well." The message "Nobody chooses to have an emergency. But choosing the right Emergency Services can make all the difference. Expect More" was also used throughout the various materials as a way to tie the concept together in a meaningful way.
"The campaign is edgy, it's very different, but the proof is in the pudding," says Szablowski. ROI analysis showed that the campaign helped Catholic Healthcare West to see a 27% increase in patient volume numbers over the previous year.
Kandace McLaughlin Doyle is an editor with HealthLeaders magazine. Send her Campaign Spotlight ideas at kdoyle@healthleadersmedia.com If you are a marketer submitting a campaign on behalf of your facility or client, please ensure you have permission before doing so.
The healthcare industry might not be getting Federal bailout money or handing out executive bonuses or booking Sheryl Crow to sing at Hollywood fêtes. But Americans are angry at businesses, industries, and institutions. And if you're not careful, they might start to look at your hospital or health system with the same critical, distrustful eye.
The controversy over salaries and bonuses and business relationships couldn't come at a worse time for healthcare organizations, as the government, the press, and the public scrutinize the spending of non-profit hospitals with the help of the revised IRS form 990 schedule H. On that form, hospitals must not only report community benefit activities such as charity care, but also list the salaries and bonuses of their top leaders and highest-paid employees.
Kind of a touchy subject right now.
World-wide, trust in businesses plummeted in 2008, according to the 2009 Edelman Trust Barometer. About 62% of informed and well-educated adults aged 25 to 64 said that they trusted businesses less than they had a year ago, according to the survey, conducted by the Edelman public relations firm. No doubt the economic crisis influenced the results—the poll was conducted in December 2008.
The study also illustrates the impact bad relationships have on consumers' interactions with organizations. In one scenario, for example, respondents were asked to think about two companies—one they trust; one they do not.
Among the consumers who trusted a company:
91% will buy their products or services
76% will recommend them to family and friends
42% will share their positive experiences online
And 55% will pay more to do business with companies they trust
Guess how many customers said they'd pay a premium to do business with a company they do not trust?
Of those that distrust a company:
77% refuse to buy their products or services
72% will criticize them to family and friends
34% will share their negative experiences online
And, of course, none said they would pay more for the products and services of a company they do not trust
Sounds like a good time to polish up that reputation.
Three tips from the sources I interviewed for the story:
Robert Pascasio, CEO, Bayside Community Hospital: Identify your place in the market. "If you haven't gone out in the world and attempted to identify how the community perceives you, you need to do that and determine where to go from there. If you don't structure who you are and offer services the public wants, needs, and will pay for, then you're wasting your time and everybody else's."
Jim Banahan, president, Banahan Communications: Build relationships with physicians. "Medical centers or hospitals are really missing it by not building a stronger rapport with their physicians." But don't overlook direct-to-consumer marketing; it is possible to educate patients to self-refer or self-select.
Rhoda Weiss, healthcare consultant: Advertising won't necessarily increase profitability, awareness, and reputation. And it won't help build relationships. "It's not about the big ad; it's about the big idea . . . Healthcare organizations need to tell their stories. They need to tell their communities what they have and what they have to offer."
Your organization might deserve awards for citizenship. Trust in and loyalty to your organization might be sky-high. And your executives likely earn every penny of their compensation. Of course you would never pull so stupid a stunt as to, say, fly a private jet into Washington to ask for a handout.
But Americans are angry right now. You have to do everything you can to prevent that economy-fueled anger from trickling down onto you and your organization.
The economic crisis is presenting leaders with unforeseen challenges. Many of those leaders are not prepared to respond effectively. They have either never been trained to do so, or they have no real-life experience on which to draw to help them navigate their way through this crisis. Unfortunately, this is exactly the time when these leaders need to lead.
A former boss used to tell me that "every crisis is an opportunity." I've had a lot of opportunities since my entire career has been spent in healthcare, an industry that has been in crisis mode for the past 20 years. In that time, I've learned how to turn a crisis into an opportunity. Here are five actions that enable leaders to do the same:
1. Focus on the problem at hand. An organization can only have ONE No. 1 priority. Today's economic crisis is clearly that priority, which means we have to temporarily stop focusing on less-important things. We can't afford distractions. Look at your organization's strategic plan, objectives and timeframes and decide what the organization will stop doing. Look at your calendar and decide what you will stop doing. Time is a leader's most precious asset. During a crisis, many leaders will keep their normal schedule and just add more hours to their day. This is a short-term strategy that is not sustainable over the long haul. Once you have narrowed the priorities for you and your organization, share this information with your organization.
Don't hide from a crisis and hope it will go away. No matter the strength of your organization's balance sheet, the economic climate can quickly turn assets into liabilities. Every day you do not focus on this crisis and its impact on your organization is another day further behind you'll be in responding.
Employees and key partners are waiting for decisive action, both from the organization and from you. They will welcome and respect your decisions. Success will take your undivided attention.
2. Stick to your guns. Never compromise on values. In a crisis, you may be tempted to do things that are not consistent with your values. Your honesty, integrity, courage, and commitment to excellence are critical values that can guide you through uncertain times. One reason we are in this economic crisis is because many leaders focused on achieving quarterly earning projections or their own incentive compensation goals and they bent the rules to achieve the desired results.
Studies confirm that employees do not trust or think highly of their leaders. That doesn't mean employees and key partners still don't look for someone they can believe in.
I have witnessed the power of leadership integrity in my own career. Years ago I was a new CEO of a hospital that had to lay off 120 people. I called a town hall meeting to announce the job cuts. Keep in mind that the employees had a reputation for being very "anti-administration." During the meeting I shared the current financial situation and the impact the layoffs would have on the future performance of the hospital. At the end of my presentation there was silence, then a question or two. Finally, an employee said to me that "this was the first time someone has told us the truth so we can understand our situation." What followed was a complete surprise – applause! From that moment on my executive team enjoyed a great working relationship with the employees because they felt we could be trusted.
3. Stop digging. It's an old saying–"When you are in a deep hole, stop digging." During an economic crisis you need to learn which products or services are profitable and which are not. For the money losers, find out what's causing the problem (don't guess!) and address the issues. Make the hard decisions to correct what can be corrected quickly. The longer you delay the more cash you will burn through.
Most organizations have kept certain products or services around too long. Eliminate these first. Those that have recently turned unprofitable and whose potential for future profitability is low should also be quickly eliminated. Do it at once so the organization can grieve the loss of the employees associated with those services and move on. Incremental elimination of programs or services will confuse employees and create unsettling conditions.
4. Every crisis is an opportunity. Think growth! What products and services can be created or expanded to help grow your way out of the current crisis. I once heard someone say "you can not shrink yourself to greatness." There is only so much expense you can take out of an organization. The future of your organization's survival depends upon growth.
In the book Results Based Leadership, the authors identify three ways to grow: expand your geography, offer new products/services, or offer additional services to existing customers. To expand geography, understand where you draw your customers from and why. Using market research, decide where to expand to draw new customers for existing products and services.
This is an excellent time to innovate because customers always want timely and cost-effective new products and services. For example, develop and offer a new type of surgery that was approved by the federal government to be offered in only a handful of hospitals throughout the nation. Being the first will definitely help gain new market share as long as the hospital successfully produces high-quality outcomes.
Finally, offering additional services to existing customers can be easy to do since you already know your target audience. Too often growth is not considered during an economic crisis. Courage to take a risk and innovate can be just what your company needs to survive and thrive.
5. Communicate, communicate, communicate! Be open, brutally honest and answer any and all questions from your key constituents, especially your employees. Many leaders hold back on providing information during a crisis either to protect the organization's reputation or so as not to look bad if they cannot answer a question. Employees are not stupid. They know things are bad. What employees appreciate is honest, accurate and timely information. They also want to know how this crisis is going to affect them personally.
When sharing information with employees, remember to anticipate questions about how your decisions will affect them in terms of job security, benefits and work schedule. If a question is asked that you can not answer, don't be afraid to say you do not know. Promise to get the answer and then follow up in getting the answer. Finally, share that answer with everyone, starting with the individual who asked the original question. This simple approach will help the leader develop additional credibility with the employees.
One more important message for leaders to provide during a crisis is a vision for the future. In a recent Harvard Business Review article titled "To Lead, Create a Shared Vision," authors James Kouzes and Barry Posner point out that 72% of colleagues and 88% of senior executives want a leader who is looking forward. Key constituents want to know where the organization is going and how they fit into that plan. The authors say that the best way to connect with employees in the future is to spend time with them in the present. Get out, make rounds, ask questions about the future and most importantly, listen!
Profound lessons can be learned from leading during crises. Awareness of these five steps can help you not only survive today's economic meltdown but be well-positioned for growth when the economy recovers.
Dan Sinnott is president of Sinnott Executive Consulting. He may be reached at Dan@Sinnottexecutiveconsulting.com.
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