In Focus

News & Insight from Chelko Consulting
The Painful Truth: Opioids and Your Health Plan

The Painful Truth: Opioids and Your Health Plan

“You know, just about everybody out here is on painkiller drugs. They’ll steal it right out of your mail box.” That’s what one of our consultants was told by his aunt, who resides in semi-rural Portage County, Ohio. The same statement could be made to most benefits managers across the country, whether their aunts reside in a pastoral rural setting, the Ritalin-infested suburbs or the inner city. It may be easy to consider drug abuse – especially of prescription opioids – as “society’s problem.” But it is a problem for nearly all plan sponsors, particularly if it’s not high on their agenda. read more…

Keeping Score: Read This in Case of Emergency

Keeping Score: Read This in Case of Emergency

Emergency room visits can quickly add significant dollars to a plan spend and result in unnecessary or inappropriate care to members. Knowing how you’re performing in this area is essential to good plan management.

Studies have shown that up to 70% of emergency room visits are not for the treatment of true emergencies. At an added cost of $1,000 or so per visit, employers may be overspending up to $150 per plan member per year on unnecessary ER services.

How do your plan results compare? Let us know if you would like to learn more about how to improve your score in this area.
read more…

Clipping the Coupons

Clipping the Coupons

Coupons providing discounts off the purchase price of goods and services have long since found a permanent and important place in shoppers’ purchase planning since Coca Cola offered the first American discount coupons in 1888. From canned vegetables to golf course tee times, the lure to shoppers of using a discount coupon is that they will pay a lower price for the purchase of the named good or service. Many of these are what economists call price elastic, meaning that sales will increase when the purchase price is lowered, and decrease when the price is raised. read more…

Keeping Score: How does your specialty drug spend stack up?

Keeping Score: How does your specialty drug spend stack up?

Specialty drugs have quickly become a significant portion of drug benefit spend. This is driven by less than 1% of claimants and calls for very specific and active management.
 
Although not nearly as visible, comparable amounts are being spent within medical benefit programs. Fortunately, there are several strategies that employers can deploy to mitigate rapidly increasing specialty drug costs.
 
How do your plan results compare? Let us know if you would like to learn more about how to improve your score in this area.
 
*From Chelko Consulting Group’s proprietary database of employer results. read more…

Follow the Money: Connecting Employee Income and Health Plan Costs

Follow the Money: Connecting Employee Income and Health Plan Costs

Many benefits managers are data-hungry. They know that intuition may lead to insight but also that probability and not mere possibility requires evidence. So, they pour over charts and tables from their TPAs, PBMs and advisors, looking for relationships between variables like health plan cost, usage, medical conditions, places of service and the differential effectiveness of providers. Often, the data analysis focuses on plan member cohorts: are our costs coming from one plant or division more than others? Is there a greater prevalence of chronic disease in certain geographical areas? Benefits managers are always trying to understand why things are the way they are, so that they can take action where it will have the greatest impact on cost and usage. In this search for meaningful correlations, there is good reason for benefits managers to use the old phrase, “follow the money,” in a way that most probably have not. read more…

Outsourcing the Baby with the Bathwater?

Outsourcing the Baby with the Bathwater?

“An outsourcing increase is a positive thing for benefits departments. Benefits staff are working smarter and more efficiently by choosing the mix of outsourcing, co-sourcing and insourcing that’s right for them. More benefits departments are adding staff members, creating balance and strategic focus among departments.”

 

Julie Stich
Research Director, CEBS
speaking at the International Foundation of Employee Benefits Plans

Benefits managers are inveterate trend watchers. How does this year’s trend in specialty drug costs project for next year? And we watch each other – is there any trend in the kinds of changes other benefits managers are making? For many of us, the worst kind of surprise is to be told of a new benefits trend from our boss rather than the other way around.

One of the trends in benefits that is capturing more benefits managers’ attention is outsourcing. For most benefit managers, outsourcing a significant portion of their department’s activities is not new. How long has it been since we outsourced the claims administration of our medical plans? read more…

It is Well with My Soul

It is Well with My Soul

“There is almost always a long tail of possibility, however thin. What’s wrong with looking for it? Nothing, it seems to me, unless it means we have failed to prepare for the outcome that’s vastly more probable. The trouble is that we’ve built our medical system and culture around the long tail. We’ve created a multi-trillion dollar edifice for dispensing the equivalent of lottery tickets – and have only the rudiments of a system to prepare patients for the near certainty that those tickets will not win. Hope is not a plan, but hope is our plan.”

 

Atul Gawande, MD
Being Mortal

We’re all gonna’ die. No matter if we eat kale three times a day, work out with a personal trainer and somehow achieve a sense of tranquility with our world, we’re all gonna’ die. It’s only when and how that are unknowable now. For a few of us, it will be quickly – a car accident or a massive heart attack. For many of us, it will be as the result of a lingering disease, like cancer, or the gradual breaking down of organs and tissues and systems. In other words, it will be a death seen coming, taking time, with some symptoms treatable, but costing us quality of a life not much extended. The conclusion will be inevitable. read more…

Semper Viglio

Semper Viglio

“More and more in the U.S., people are making choices between a bag of groceries and a medicine, a copay. The long-term sustainability of the industry and our ability to deliver breakthrough medicines requires us to demonstrate value.”

 

Paul Hudson
President, AstraZeneca U.S.

Many of our In Focus readers have management responsibilities that go beyond their companies’ healthcare plans and extend into the qualified plans arena, most frequently with their companies’ 401(k) plans. Typically, the concerns of healthcare and 401(k) plan management don’t intersect. But in March, in a Boston hotel room, such an intersection did take place. It’s an intersection that may make a difference to how benefits managers and their prescription drug plan members will be urged to perceive the value proposition of prescription drugs. read more…

Confronting Consolidation

Confronting Consolidation

“The [Advocate-North Shore] case shows the agencies are willing to go to court unless parties have strong arguments that consumers will benefit from the merger.”

 

David Balto
former Policy Director, Federal Trade Commission

Business consolidation is not new. It’s both a revered and a reviled part of our history. It’s what Carnegie did to control the steel market; Ford and Alfred Sloan (General Motors) to control autos; Vanderbilt to control railroads, J.P. Morgan to control banks and, of course, Rockefeller to control the oil market. What these “Robber Barons” accomplished years ago is being applied by their present-day successors. Think of airlines and telecoms for two prominent examples. To the list of consolidated industries, we are witnessing the creation of a new healthcare market. read more…

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