Engaging Consumers to Purchase Value

Commonwealth of VirginiaDepartment of Human Resource Management

State Employee Health Benefits

Virginia Chamber of Commerce3rd Annual Virginia Health Care Conference

Richmond Convention Center, Richmond, VAJune 6, 2013

$1 Billion State Employee Health Plan

Cost Drivers

June 2013 2

Expensive procedures Treatment of chronic

conditions Prescription drug therapy

cost Employee lifestyle

Smoking Physical activity level Overweight

Average employee age

Top Ten Claims ExpenseMedical

ProceduresChronic

ConditionsPrescription

Drugs1. Musculoskeletal

1. Coronary artery disease

1. Nexium (stomach acid)

2. Neoplasms (tumors) 

2. Breast cancer

2. Enbrel (rheumatoid arthritis)

3. V-Codes 3. Cerebrovascular disease

3. Humira (rheumatoid arthritis)

4. Circulatory 4. Diabetes4. Crestor

(high cholesterol)

5. Ill-defined symptoms (undetermined causes)

5. Hypertension 5. Singulair

(asthma/allergy)

6. Digestive 6. Lung cancer 6. Cymbalta

(depression)

7. Genitourinary 7. Skin cancer7. Copaxone

(multiple sclerosis)

8. Accidental injury 8. Obesity8. Atorvastatin

Calcium (high cholesterol)

9. Nervous system/sense organs

9. Oral cancer9. Lipitor

(high cholesterol)

10. Respiratory 10. Substance abuse10. Amblify

(depression)

47.3% ofAll Claims Expense

6.7% ofAll Claims Expense

5.0% ofAll Claims Expense

Note: These areas may not be mutually exclusive

Consumer-FocusedPlan Design Maternity Weight Watchers Smoking Cessation Flu Shots Bariatric Surgery Diabetes Coronary Artery Disease

3June 2013

Maternity

4

Consumer Action Participate in the

Maternity Program Begin the program in

the first trimester Get extra dental

cleaning

Plan Incentive Waive $300 inpatient

or $125 outpatient co-pay

June 2013

Normal Birthweight (>5 lbs. 8 oz.)

Full Term (>37 weeks)

2008 87.7% 84.2%

2009 91.5% 90.3%

2010 90.9% 90.7%

2011 92.2% 90.3%

2012 92.1% 90.5%

Program Norm 93.2% 90.9%

National Norm 91.8% 88.0%

50.0%

60.0%

70.0%

80.0%

90.0%

Maternity Management Program Deliveries

Weight Watchers

Consumer Action Participate in

75% of the classes

Plan Incentive Receive 50%

reimbursement of class fees paid

5June 2013

Smoking Cessation

Consumer Action

Participate in the program

Plan Incentive No charge for

program

6June 2013

0% 10% 20% 30% 40% 50%

Smoking Prevalence and Quit Rates

National average 6-month quit rate State 6-month quit rate

State employee smoking prevalence Virginia smoking prevalence

National smoking prevalence

`

Source: Free and Clear smoking cessation program, Centers for Disease Control and published literature

Flu Shots

January 26, 2012 7

Consumer Action

Get a flu shot

Plan Incentive No charge for

shot

2008 2009 2010 2011 2012Pharmacy 13,902 20,959 22,612 24,791 26,747

Medical 31,222 27,340 39,338 34,817 34,777

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Total Flu ShotsState Health Plan Members

45,12448,299

61,950 59,608 61,524

Bariatric Surgery

Consumer Action Participate in the year-long coaching program Attend a Weight Watchers or similar program

Plan Incentive Eligible for plan coverage Receive health coaching pre-surgery and post-

surgery at no charge Eligible for Weight Watchers 50% reimbursement Waive $300 inpatient hospital or $125 outpatient

co-pay8June 2013

Bariatric Surgery

January 26, 2012 9

 

Lifestyle Changes 

· Improved nutrition· Smaller food portions· Better beverage choices· Increased activity/exercise· More positive coping skills· Increased confidence· More health care engagement· Stopped smoking

 

 80%81%78%65%62%59%57% 8%

 Health Condition Improvements

 · Diabetes· Blood Pressure· High Cholesterol

  *All results from post 12-month survey

 50%46%15%  

$10.2 $10.6

$5.9

$0.8 $1.5

$0.0

$2.0

$4.0

$6.0

$8.0

$10.0

$12.0

Total Bariatric Surgery and Obesity Medical Expense

FY 2008-2012(in millions)

2008 2009 2010

 

 

Diabetes

January 26, 2012 10

Consumer Action Annual physical Under the care of a physician for diabetes Annual A1C test Comply with medications

Plan Incentive Tier 1 and Tier 2 medications at no charge Testing supplies at no charge Receive coaching at no charge

Coronary Artery Disease

Consumer Action Participate in the 6 month Health Diagnostic Lab

program Receive initial health screening

Biometric measurements Blood draw Share results with physician

Meet with clinical health consultant Get follow-up health screening ~ 6 months later

Plan Incentive Receive HDL tests at no charge Receive health coaching based on results at no

charge

11June 2013

Summary Data driven Value-Based Insurance Design (VBID)

Short-term cost investment for long-term health improvement resulting in lower cost

Continuous improvement

12June 2013