Rhode Island Funds Statewide EHR Repository

Rhode Island Plans Central Bank of e-Health Records

BY Nancy Ferris
Published on June 15, 2006

Rhode Island's legislature has approved borrowing $20 million to finance the creation of a statewide repository of e-health records, Gov. Donald Carcieri told the Government Health IT Conference today.

Carcieri said his state, like others, is facing rapid escalation of health care costs and is taking steps to hold them down. Medicaid alone now accounts for 24 percent of the state's budget.

"Health care is the No. 1 public policy issue for our nation," he said, and no solutions are at hand. "It falls on the states to do something."

Of all the potential fixes for health care, Carcieri said, health IT holds the most promise in the near term. "Health IT can really squeeze costs out of the system, increase quality and improve outcomes," he said.

The governor said up to $2 billion of the $6 billion spent on health care annually in Rhode Island is wasted because the right information isn't available when needed. For example, he said, 20 percent of the diagnostic tests done on patients are unnecessary.

The compact size of Rhode Island, which has about 1 million residents and only two major health insurers, may make it easier to fix the health care system, Carcieri said.

The health records bank recently approved by the General Assembly will hold digitized patient records and make them available to authorized individuals.

Carcieri said it should be established as a public-private partnership. "There needs to be public oversight" to increase public trust in the data bank, he said.

Although the bond issue authorized by the legislature will pay for establishing the databank, the governor said the method of financing operations hasn't been decided yet. He favors charging a small fee for each transaction, he said, but getting such a system in place will not be easy.

Asked how his state's program meshed with federal health IT activities, Carcieri acknowledged the potential value of a national health information network. But, he said, "If we wait for the federal government to come up with a whole large scheme, there are so many interests" it could take years.

Massachusetts Hospitals Leading the Way on Healthcare Quality

Leading the way on healthcare

By Cleve L. Killingsworth | June 21, 2006

IMPROVING the quality of health care saves lives. That's the lesson behind last week's announcement by the Institute for Healthcare Improvement that more than 120,000 such lives were saved nationally because hospitals followed proven interventions that deliver safer and more effective care.

All 72 Massachusetts acute care hospitals participated in this campaign. Their success -- together with the state's landmark health care reform law that will focus on many of the best practices used by the institute through the Massachusetts Health Care Quality and Cost Council -- puts the state in a unique position to lead the country in delivering top-quality health services.

Don Berwick, president of the Cambridge-based institute, explained that, over the past 18 months, a national effort by 3,000 hospitals across the country prevented the unnecessary deaths of more than 122,300 patients.

The effort supports interventions that make a real difference for patients. In many cases, that just means getting hospitals and front-line health workers to agree to follow practices that have been shown to eliminate error and save lives.

Some policies and procedures that the institute and the participating hospitals have put in place are relatively simple. For example, they are committed to giving patients who are at risk for heart attacks aspirin and beta-blockers. They are making sure that patients on ventilators have their heads raised between 30 to 45 degrees at all times to prevent them from developing pneumonia. They are implementing rapid-response teams at the first sign that a patient's condition is worsening. And they are making sure that doctors and nurses working with patients who are receiving medicines and fluids from central lines clean the patients' skin with a certain type of antiseptic.

While these procedures are not revolutionary in concept, they require significant collaborative effort and commitment. Taken together, these everyday actions can represent a sea change in patient outcomes for hospitals. Because of the size, diversity, and complexity of the health care system -- with all its insurers, providers, caregivers, and facilities -- it is difficult to disseminate best practices that improve patient health. And yet the success that the institute has fostered shows that it can be done.

It is fitting that every acute-care facility in the state is participating in this process. Massachusetts has already shown it can lead the nation in achieving better health care. Passing the legislation that made universal access to health care the standard wasn't easy. It took bringing together political leaders from all sides, business leaders, consumer and patient groups, insurers, hospitals, doctors, and nurses.

And there is more that can and must be done. The state Health Care Quality and Cost Council, established by the landmark legislation, can further improve the delivery of medical care and do so in a way that restrains the growth in spending. The success of the institute's effort shows what can be accomplished when all insurers and hospitals collaboratively choose concrete goals that improve the safety and effectiveness of care.

Massachusetts has the best health care system in the country -- but it can get better. Given the high caliber of the hospitals and medical schools, the commitment of doctors and nurses, and the pioneering spirit of organizations such as the institute and others that are willing to point out where the system is failing and fix it, Massachusetts is in a unique position to fundamentally transform it.

The institute has shown that improving the system will save lives. And so with the wind of reform at our backs, universal health coverage within reach, and progress not only possible but demonstrable, now is the time to commit to making Massachusetts the standard bearer for quality health care for all.

Cleve L. Killingsworth is president and CEO of Blue Cross Blue Shield of Massachusetts.

Massachusetts Health Plan for 500,000 Uninsured to Define Provider Networks

State plan may curb hospital choice

Insurance authority looks at ways to keep premium costs down

By Jeffrey Krasner, Globe Staff | June 8, 2006

At yesterday's first meeting of the state authority charged with crafting affordable health insurance, a state Medicaid official said restricting patient access to a limited network of hospitals could help keep premiums down.

Brian Wheelan , assistant director of Medicaid, spoke before the board of the Commonwealth Health Insurance Connector Authority, which was created under the healthcare reform bill intended to extend coverage to the roughly 500,000 Massachusetts residents without health insurance.

As an example of the differences in hospital costs, he said that Cambridge's Mount Auburn Hospital, a Harvard-affiliated teaching hospital, charges $1,800 to deliver an underweight infant, while Massachusetts General Hospital, also a Harvard-affiliated teaching hospital, charges about $5,300. Brigham and Women's Hospital, another teaching hospital that has a reputation for quality maternity services, charges $3,200, he said.

"Don't let anyone tell you there aren't huge savings in cost while maintaining quality," he said at the meeting held at One Ashburton Place.

Wheelan said defining provider networks, which mandate which hospitals patients can use, could generate enormous savings as the Connector seeks to craft an affordable insurance plan for individuals that features a target premium of $300 a month. Some board members seemed open to that approach.

"If you have to restrict something, I'd rather restrict the breadth of the network rather than cut benefits," said Dolores L. Mitchell , who also serves as executive director of the Group Insurance Commission, which provides insurance for state employees and retirees.

David Torchiana , chief executive of the Massachusetts General Physicians Organization, acknowledged that costs are higher at his hospital, but he warned against restricting access. Residents of Everett, Chelsea, and other areas rely on Mass. General as a community hospital, he said.

Jon M. Kingsdale , the former Tufts Health Plan executive who is executive director of the Connector, said he will rely on insurers to craft low-cost offerings, which might include a restricted network. ``We want to be open to what health plans bring us," he said. ``I suspect if there is substantial value in limited networks, we'd be open to them."

Kingsdale is being offered a three-year contract with a $225,000 annual salary, although final details have not been worked out.

The issue of restricting networks was one of many addressed yesterday . The new authority is chaired by Thomas Trimarco, secretary of health and human services, but will operate largely independently. It will develop a low-cost insurance plan that is intended to be a key part of the state's reform effort. The state will also expand Medicaid, the federal and state program that provides healthcare to low-income residents, and will provide subsidies for residents who earn less than three times the federal poverty rate, about $60,000 a year for a family of four.

The authority's decisions will determine what is covered by the affordable health insurance plan, called Commonwealth Care. But it is also operating under a tight deadline.

"We'd like to be enrolling people in Commonwealth Care by Oct. 1, less than four months away," said Kingsdale.

Along with limited provider networks, the state highlighted other approaches to low-cost insurance, such as eliminating some healthcare mandates. For instance, Massachusetts insurers now must cover assisted reproductive techniques like in vitro fertilization. Wheelan said the Connector should look at suspending some of those benefits for its low-cost product.

He also discussed using tax-advantaged health savings accounts, which enable employees to set aside pretax dollars for out-of-pocket expenses. Such accounts are typically linked to health plans with high deductibles. Wheelan said preventive services like routine checkups could be exempted from the deductibles.

Another approach would be to charge higher premiums for residents who smoke, similar to the way life insurance companies charge higher rates for smokers, he said.

Charles Joffe-Halpern , executive director of Ecu-Healthcare Inc. of North Adams, which provides access to healthcare for Berkshire County residents, said he was wary of so-called consumer-directed healthcare plans, which feature high deductibles and copayments.

"It's a slippery slope when you start to talk about consumer-directed healthcare," he said.

Jeffrey Krasner can be reached at krasner@globe.com.

Consumer-driven Health Plans Membership Continues to Grow

UnitedHealth sees explosion in HSA and HRA enrollments

San Francisco Business Times - June 16, 2006

by Chris Rauber

Minnesota-based UnitedHealth Group said membership in its consumer-driven health plans continues to soar, both in California and nationwide.

Membership nationally has surpassed 1.75 million enrollees, UnitedHealth said June 8. In California, that translates into 118,000 people enrolled in so-called "CDHPs", up more than 74 percent from the prior year, said Cheryl Randolph, a spokeswoman for UnitedHealth's Cypress-based PacifiCare unit. She said the company doesn't break out those numbers by region.

Of those 118,000 enrollees, she said, 25,000 have signed up for a health savings account or HSA and 93,000 for a related health reimbursement account.

Nationally, membership in its HSA and HRA plans jumped 75 percent from June 2005, with more than 750,000 new individuals participating in the last year.

"Consumers are becoming much more comfortable with account-based plan designs," said Mike Tarino, CEO of Definity Health, the UnitedHealth unit that manages these health plans. "More than 13,000 employers have already turned to us to incorporate a consumer-driven design into their benefits strategy, and our CDH membership among large, national employers alone recently topped 1 million."

Still, all is not rosy in the consumer-driven health plan world. Other sources say that nationally, only about 1 in 4 enrollees in such plans actually opens and funds an HSA, although the data is a bit murky. Without a linked HSA or related account, a consumer-driven plan is just a high-deductible insurance offering by another name, critics say. PacifiCare's Randolph cautions that it's just five and a half months into the year, however, "and believe it or not some people simply don't get around to opening the account right away."

The company's data on companies with 100 to 5,000 employees shows that when the employer contributes to the HSA, 89 percent of employees open an account, and 60 percent fund it.

Chris Rauber can be reached at (415) 288-4946 or crauber@bizjournals.com

Encouraging Results of Incentive-based Health Insurance Plans

Wellness pays as health costs shift
Consumer-directed insurance plans use education, rewards to change lifestyles

By Ann Meyer
Special to the Chicago Tribune
Published June 12, 2006

Pedometers, workouts and wellness points are the topics of casual lunchtime conversations at the DuPage Credit Union in Naperville now that the company offers a consumer-directed health insurance plan that rewards employees for healthy behavior, the company said.

"I'm watching team members come together and really motivate one another to be more healthy individuals," said Lori Mecca McGrath, human resources manager.

The wellness focus has been building since October 2004, when the credit union nixed the standard PPO plan it had offered for years in favor of a lesser-known, $1,000-deductible consumer-directed health plan with lower premiums and a health reimbursement arrangement to which the company contributes $600 per employee, she said. If workers don't spend the $600, it is theirs to keep, McGrath said.

Besides encouraging employees to spend wisely, the company's new plan from Destiny Health rewards employees with "Vitality Bucks" for engaging in health-oriented activities such as health screenings, fitness workouts and smoking-cessation programs. Bucks can be exchanged for merchandise.

"It gives you an impetus to pay a little more attention to your health care," McGrath said.

While many businesses are turning to high-deductible health plans to curb double-digit premium increases, experts say the plans must encourage healthier lifestyles for them to be effective long term.

"Without that component of prevention it's more of a short-term savings than long term," said Kenneth Olson, president of Horton Benefit Solutions in Orland Park.

By encouraging workers to control behavior that otherwise can lead to expensive health care, a company also can control its premium increases, Olson said. In the past couple of years, he said, companies are beginning to see a greater spread between premiums of standard PPO plans and those of consumer-directed plans.

"This is very encouraging," he said.

But encouraging workers to change their habits requires a major educational push, and many small businesses simply do not have the resources to deliver it themselves.

The wellness concept makes sense to David Johnson, director of human resources at Beckett Associates, a Bedford Park distributor of trading cards and collectibles that gives its 140 employees a choice of three Blue Cross plans: a PPO, HMO or high-deductible plan tied with a health savings account.

"A healthy workforce is a reliable, dependable workforce," Johnson said. "We're looking for people able to come to work not encumbered by maladies and diseases. You want people to feel well and to be healthy."

While some of the company's workers play basketball or soccer on their lunch breaks, to administer its own full-blown wellness program with something for everyone would be too big a task, Johnson said. So the company is considering adding a program administered by Blue Cross.

Blue Cross offers Blue Care Connection, with an online personal health manager who provides guidance on exercise and nutrition based on members' personal data and goals, said Debbie Halan, senior manager of product management. Members start by taking the Mayo Clinic health risk assessment online.

From their answers the online program provides advice on eating healthier, setting up an exercise program and sticking with it.

Members report their progress daily and are sent reminders to encourage follow-through.

"If you didn't walk your mile today, it's like having a personal trainer there reminding you," Halan said.

Another component provides information about treatment costs and hospital comparisons. Members with questions about a condition or treatment can contact a Blue Cross nurse for additional guidance.

Besides concerns about escalating health-care costs, more companies are embracing wellness programs to keep their workers healthy and productive, said Kirk Pion, director of strategy innovation and delivery at Blue Cross and Blue Shield of Illinois.

"It's a bottom-line savings," Pion said.

Meantime, Humana Inc. offers several consumer-directed health plans and is slated to roll out its Virgin Life Care wellness offering in the Chicago market by 2007, said David Reynolds, vice president of sales for Humana in Illinois. That plan, available in several other markets, rewards members with HealthMiles for exercising, tracking blood pressure, body fat and weight, and achieving health and fitness goals. Reward points can be redeemed at stores like Best Buy, Home Depot and Target

Currently, Humana has 421,000 members in its consumer-directed plans, representing about 13 percent of its total membership. But Reynolds noted that the Chicago market has not been as quick to embrace them as other areas of the country.

"In Chicago, there's a great HMO presence and an industrial economy. There's a history of offering very rich benefits," he said. "We're having to open people's eyes to new possibilities."

But education will gradually change that, Reynolds said.

"What really helps is once people get into these plans and start to see the behavior change, it changes the claims trend," he said.

By encouraging employees to use more preventive health services, they often need fewer after-the-fact interventions like hospital stays, according to Humana's three-year study of 155 companies representing 13,000 consumers.

The study indicates customers using Humana's consumer-directed health plans saw annual claims-cost increases of between 5 percent and 6 percent, compared with double-digit increases in other plans in recent years.

Most savings came from changes in behavior instead of shifting costs, as many consumers used preventive services and avoided the need for hospital stays, the company said.

Meantime, Destiny Health recently reported disappointing financial results for the six months ended Dec. 31, 2005, stemming in part from trouble gaining traction in the Chicago market.

Still, Destiny is considered a leader in the area of incentives, and many other insurers are taking note of its Vitality rewards program, particularly as it contributes to smaller premium increases. Destiny offers discounts on premiums when employer groups achieve certain goals, said Patty Peterson, vice president of marketing.

"Long term, the healthier people get, the better health-care costs will be in check," Peterson said. "It's better for the system and the small employer."



Copyright © 2006, Chicago Tribune

Market-oriented Healthcare Insurance Reforms in Massachusetts

State plan may curb hospital choice

Insurance authority looks at ways to keep premium costs down

By Jeffrey Krasner, Globe Staff | June 8, 2006

At yesterday's first meeting of the state authority charged with crafting affordable health insurance, a state Medicaid official said restricting patient access to a limited network of hospitals could help keep premiums down.

Brian Wheelan , assistant director of Medicaid, spoke before the board of the Commonwealth Health Insurance Connector Authority, which was created under the healthcare reform bill intended to extend coverage to the roughly 500,000 Massachusetts residents without health insurance.

As an example of the differences in hospital costs, he said that Cambridge's Mount Auburn Hospital, a Harvard-affiliated teaching hospital, charges $1,800 to deliver an underweight infant, while Massachusetts General Hospital, also a Harvard-affiliated teaching hospital, charges about $5,300. Brigham and Women's Hospital, another teaching hospital that has a reputation for quality maternity services, charges $3,200, he said.

"Don't let anyone tell you there aren't huge savings in cost while maintaining quality," he said at the meeting held at One Ashburton Place.

Wheelan said defining provider networks, which mandate which hospitals patients can use, could generate enormous savings as the Connector seeks to craft an affordable insurance plan for individuals that features a target premium of $300 a month. Some board members seemed open to that approach.

``If you have to restrict something, I'd rather restrict the breadth of the network rather than cut benefits," said Dolores L. Mitchell , who also serves as executive director of the Group Insurance Commission, which provides insurance for state employees and retirees.

David Torchiana , chief executive of the Massachusetts General Physicians Organization, acknowledged that costs are higher at his hospital, but he warned against restricting access. Residents of Everett, Chelsea, and other areas rely on Mass. General as a community hospital, he said.

Jon M. Kingsdale , the former Tufts Health Plan executive who is executive director of the Connector, said he will rely on insurers to craft low-cost offerings, which might include a restricted network. ``We want to be open to what health plans bring us," he said. ``I suspect if there is substantial value in limited networks, we'd be open to them."

Kingsdale is being offered a three-year contract with a $225,000 annual salary, although final details have not been worked out.

The issue of restricting networks was one of many addressed yesterday . The new authority is chaired by Thomas Trimarco, secretary of health and human services, but will operate largely independently. It will develop a low-cost insurance plan that is intended to be a key part of the state's reform effort. The state will also expand Medicaid, the federal and state program that provides healthcare to low-income residents, and will provide subsidies for residents who earn less than three times the federal poverty rate, about $60,000 a year for a family of four.

The authority's decisions will determine what is covered by the affordable health insurance plan, called Commonwealth Care. But it is also operating under a tight deadline.

"We'd like to be enrolling people in Commonwealth Care by Oct. 1, less than four months away," said Kingsdale.

Along with limited provider networks, the state highlighted other approaches to low-cost insurance, such as eliminating some healthcare mandates. For instance, Massachusetts insurers now must cover assisted reproductive techniques like in vitro fertilization. Wheelan said the Connector should look at suspending some of those benefits for its low-cost product.

He also discussed using tax-advantaged health savings accounts, which enable employees to set aside pretax dollars for out-of-pocket expenses. Such accounts are typically linked to health plans with high deductibles. Wheelan said preventive services like routine checkups could be exempted from the deductibles.

Another approach would be to charge higher premiums for residents who smoke, similar to the way life insurance companies charge higher rates for smokers, he said.

Charles Joffe-Halpern , executive director of Ecu-Healthcare Inc. of North Adams, which provides access to healthcare for Berkshire County residents, said he was wary of so-called consumer-directed healthcare plans, which feature high deductibles and copayments.

"It's a slippery slope when you start to talk about consumer-directed healthcare," he said.

Jeffrey Krasner can be reached at krasner@globe.com.