Spokane Journal of Business

ConsumersÂ’ role grows in health-care sector

Insurers provide more information, expect members to make choices

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Do you consider yourself a good consumer? Would you buy a car or a major appliance without comparing costs, reading up on whats available, and consulting reviews?

Can you say the same of yourself as a consumer of health care?

Insurers are hoping that you canif not now, then soon.

Health insurers, big and small, have begun providing their subscribers with lots more information, in a trend thats been called the consumerization of health care. Often, that information concerns the diagnosis, treatment, and prevention of common health conditions such as high blood pressure, obesity, diabetes, and cancer. In some cases, it also includes information on health-care providers, including cost comparisons.

The general idea is that, armed with more knowledge, people will take a more active role in managing their health carewith the ultimate goal of reining in runaway insurance costs.

It makes sense, says Dr. Norman Charney, executive director of the Inland Northwest Business Coalition on Health, a Spokane alliance of insurers, health-care providers, and employers.

When you buy anything, you want to know the cost, but in health care, weve gotten away from that, Charney says. Youve got your little card and you pay your co-pay and you dont care how much it costs.

In a world where employers are shifting to their employees a greater share of health-insurance costs, people have a larger incentive to be savvy health-care consumers, Charney and insurance industry executives assert.

Ken Bryan, CEO of Spokane Health LLC, which offers the USelect insurance plan here, says the idea is like one of those Milton Friedman quotes: If you spend someone elses money youre not careful about how much you spend, but youre careful about what you get. If youre spending your own money, youre careful about both.

Consumer-directed plans

Information is the foundation for the consumerization of health care, and the result is the rise of information-rich, employer-sponsored insurance plans that are lumped under the heading consumer-directed.

Such plans seek to educate employees about the true costs of medical services, then give them more financial responsibility for making medical-purchasing decisions, says the big New York-based accounting firm Deloitte & Touche LLP, which conducted a survey on the topic earlier this year.

These new models require a more-educated health-care consumer and, the argument goes, as these consumers become financially responsible for more of the real cost of health-care services, both demand and long-term health-care costs will decrease, the company says in its survey report.

Such plans can be controversial, the report notestheyre seen by some as nothing but a way to shift costs from employers to employees, and their ramifications for people with chronic illnesses are worrisome.

As of the beginning of this year, only 11 percent of the employers surveyed by the accounting firm offered a consumer-driven health plan, but 8 percent said they definitely planned to offer one in 2004 or 2005, and 35 percent said they were considering offering such a plan.

USelect is one form of consumer-driven plan, and Bryan says its meeting with success here. By Oct. 1 well have 1,400 (members), he says.

USelect is Internet based: To enroll, members use a Web site to assemble their own network of physicians, hospitals, and clinics, and choose the level of co-pays they want for various services.

We provide them with comparative information both in terms of background information on a provider and relative cost information, Bryan says.

Members make choices based on their physician and clinic preferences, then weigh those choices against the differences in cost to them, he says.

So far, given a choice between getting the doctor they want and paying a lower price, most people choose the doctor, Bryan says.

Another consumer-driven health-care model is called a tiered network plan; Washingtons largest private health insurer, Mountlake Terrace-based Premera Blue Cross, introduced one in January, called Dimensions.

Premeras consumer-driven plan analyzes practice patterns among physicians and clinics and sorts those health-care providers into tiers based on how cost efficient they are, says Premera spokesman Scott Forslund.

Its not, whats the fee for an office visit?, but what is it taking to get a person well given a certain diagnosis and a certain level of severity? he says.

People who are insured under the Dimensions plan then can use that information to make decisions on whether they want to seek care from a provider in the most-efficient tier, or pay more out of pocket to see a provider in one of the less-efficient tiers, Forslund says.

I can start to value that like I do in almost everything else, he says. How much is it worth to me? Is it worth that difference in cost or not?

About one-third of Premeras Washington members now are enrolled under Dimensions, Forslund says.

The bottom line: dollars

Although not all insurers have begun offering consumer-directed plans, most private insurers say they provide their members with much more information today than they did even a few years ago.

A lot of that information is aimed at helping people get and stay healthy, and is distributed on the Internet, in company magazines, and through workplace seminars.

Why would an insurance company want to improve health? Its dollars, says Cynthia Norwood, CEO of Spokane-based Physician Hospital Community Organization (PHCO), a third-party administrator of self-insurance plans for big companies.

People are sicker and are utilizing more (health-care services) than they used to. If we can teach people to take better care of themselves, in the long run the insurance carrier will do better financially and could return some of those gains to customers in the form of lower premiums, Norwood says. The PHCO offers workplace wellness programs and other health information to its clients employees.

Employers, which still pay the majority of private health-insurance premiums, benefit because healthy employees are absent less often and are more productive when theyre at work, Norwood adds.

Insurers, for their part, say the health information they offer is medically soundan important distinction in a world filled with unedited and unfiltered Internet content.

We are providing high-quality information thats evidence-based, and not gathered from Joe-Bobs cancer page, says James Hereford, director of health informatics at Seattle-based Group Health Cooperative, which has about 83,000 members in Eastern Washington and North Idaho.

In some cases, providing consumers with more health information might avert an expensive office visit, but thats not the purpose, insurers say.

That relationship between patient and doctor is a very important one and this kind of information is not intended to supplant or compete with that, but really, to provide more information to assess, says Forslund, of Premera.

In other cases, information provided by the insurer, such as a recommendation that people visit their doctors to receive flu shots, might generate an office visit, he says.

Premera offers health information in two formats. It provides general health information on its Web site, while offering targeted disease-management programs to those with diabetes, kidney disease, cancer, or cardiovascular disease, he says. Those targeted programs, which are voluntary, include educational mailings, customized care plans, and even personal coaches, he says.

Personalized approach

Group Health emphasizes the personal in its consumer-information offerings, which it says is made possible because its both a health-care provider and a health insurer.

Group Health members, using their MyGroupHealth Web page, can e-mail questions to doctors, make appointments, and view their laboratory results and immunization histories online, Hereford says. Through MyGroupHealth, members also have access to a health-information database, disease-specific chat groups, and prescription-refill services. Some financial information, such as comparisons of drug costs, also is provided online, he says.

MyGroupHealth offers information that makes the doctor-patient relationship more efficient and effective, Hereford asserts.

Traditionally, the only access patients have had to their health-care providers has been through scheduled appointments, no matter what you want, whether all you want is information, he says.

Through secure messaging, a patient may get the information he or she is seeking without making a time-consuming visit. Alternately, if the patients e-mail communication results in an office visit, its a more efficient visit because a conversation has already occurred, Hereford says.

Group Health now is working on technology that would allow its members to provide health information to their doctors from their homes, Hereford says. The HMO has conducted a pilot project in which some patients with congestive heart failure were asked to weigh themselves regularly on a scale connected to their home computer, and those readings were transmitted to their doctors.

When weight starts to go up, its a key signal we need to intervene, Hereford explains.

He envisions a similar setup for people whose blood pressure must be constantly monitored; that reading would be performed by attaching a blood-pressure cuff to a home computer, he says.

The future?

Charney, at the Inland Northwest Business Coalition on Health, envisions a revolutionary change in the way people consume health care in the future.

Consider this scenario, he says: When its time for a womans mammogram, she could look up online all the providers of that test in her region and choose the one that suits her best.

Information carried online could include the cost of the procedure, the age of the mammography equipment used by each provider, and information on the radiologists who would interpret the films, including where they went to school, whether they were board-certified, and whether theyd ever had any disciplinary or legal proceedings filed against them.

Based on that information, she may or may not want to go to the cheapest one, Charney says. Thats why you need more information, so you can make a good consumer decision.

Some caveats

Norwood, at the PHCO, cautions that consumer-driven health care of the sort Charney envisions only will work if health-care providers have the flexibility to compete on price, and she contends that they dont have that flexibility here.

Reimbursement by private health plans is modeled on government reimbursement under the Medicare plan, and reimbursement levels here are much lower than they are in other areas of the country, health-care providers here have said in the past.

In Spokane, I believe and most of the folks in the know with health care believe that providers are actually as low as they can go (on price) and theyre all there together, she says.

In addition, Hereford, at Group Health, says that arming patients with more information will change the doctor-patient relationship, which could be unsettling to both doctors and patients.

Its a learning curve for us as patients to be able to use this information and engage with our providers on a more equal basis, he says. I dont think thats something that comes naturally to us and historically certainly hasnt been the case. Some doctors, furthermore, might not want to give up their role as the expert, Hereford says.

This is somewhat new territory, and it continues to evolve, he says, but we see examples all the time of patients and providers who use the infrastructure and technology we put in place very effectively.

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