Proprietary Technology Promotes Union Health Plans’ Viability
November 6, 2012
By Marc Bussanich
The Teamster Center Services recently hosted the 19th Health & Benefits Expo where different vendors in the labor benefits worldshowcased their products and services. Care to Care LLC exhibited for the second consecutive year at the conference. The company provides evidence-based radiology management solutions for states’ Medicaid plans,Medicare Advantage plans and union-run, self-funded health plans that help them achieve cost effective healthcare.
According to the company, the growing use of advanced imaging studies such as MRI, CT, PET and nuclear cardiology scans on an aging population is contributing to unnecessary testing, which raises costs and can adversely affect patients physically.
Based on a study by the Tiber Group, a healthcare consulting firm, the “U.S. expends $220 billion on annual imaging tests.” In addition, the Government Accountability Office estimates that up to one-third of high-tech imaging does not supply useful diagnostic information, “contributing to $26.5 billion annually in unnecessary costs.”
The costs associated with these tests can be a financial burden for self-funded health plans. Companies such as Care to Care have developed proprietary technology using nationally accepted clinical guidelines to determine a test’s medical appropriateness. This reduces wasteful tests and helps to provide the opportunity for health plans to sustain their plans’ longevity.
Kevin Howat, EVP of Business Development, said that the company has experienced a strong growth trajectory since the company was founded in 2007.
“We’ve gone through very rapid growth. In early 2010, we had 30,000 members under management. In January of 2011, after winning a contract with a large union health fund in New York and another client, our members grew to 400,000. As of May, we now have over 1 million members,” said Howat.
In fact, the company was able to save the New York-based union health plan $1 million dollars in the first year by ensuring medical appropriateness and reducing the utilization rate of high tech medical imaging from 185.50 per 1,000 members in 2010 to 166.7 members in 2011, a 10 percent reduction.
“As part of the contract with the union health fund, we need to be consulted when there are any requests for high tech imaging to be certain that the tests are based on medical necessity, which reduces patient risk to harmful effects of radiation,” Howat said.
Lee Weinreb, VP, Strategic Communications and Program Development for Care to Care, said that the company uses proprietary clinical guidelines it has developed to determine if the tests meet current medical best practice criteria and what is the appropriate scan.
“Our criteria are based on the most widely accepted national specialty societies such as the American College of Radiology, the American College of Cardiology, the American Society of Clinical Oncology, the National Comprehensive Cancer Network and current peer reviewed literature; they are not just random guidelines,” said Weinreb.
As radiation is cumulative in the body, any unnecessary testing that uses radiation can expose patients to increased cancer risk. In a case study developed by Care to Care, the company cites a report by the Archives of Internal Medicine, which estimates that approximately “29,000 excess cancers are anticipated to result from the 72 million CT scans performed on Americans in 2007 alone, and an estimated 15,000 of those cancers could be fatal.”
The company also reduced utilization, and consequently costs, for a Medicare Advantage Plan, Elderplan, serving urban beneficiaries. The plan was spending almost $15 dollars per member per month for high-tech imaging in 2009. Care to Care was able to reduce by 37 percent the cost to $9.24 in 2011. Fifty-five percent of the savings was derived matching up the request to the company’s clinical criteria, while 45 percent was realized from complementing the plan’s network of imaging providers with Care to Care’s network.
Care to Care also helped a large national self-funded union health plan to analyze its costs. Weinreb noted that the plan was paying high network costs because the plan’s network couldn’t accommodate the members’ work schedules.
“A lot of late-shift members were going to the emergency room because free-standing facilities were closed. We proposed building a cost-efficient network of physicians to ensure appropriate choice for the coverage area.”
Data analysis is the primary method by which Care to Care bases its recommendations to clients.
“Data analysis is very important because it allows us to peel back layers of information to understand the real drivers behind utilization, or lack of,” Weinreb said.
Weinreb also noted that as the population ages and the number of Baby Boomers flow into retirement and pension funds, the challenge of self-funded health plans going forward will be managing the growing number of nuclear cardiac stress tests. According to the American College of Cardiology, 22 percent of the tests are ordered inappropriately.
“According to a recent MedPAC [an independent Congressional agency] report, cardiologists receive 36 percent of their income from imaging tests, including nuclear cardiology studies, which carry very high levels of radiation—sometimes as much as two to three times that of a CT scan.”