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Making Cents: Population Health Management Programs Decrease Overall Cost and Number of High-Cost Claims in Gordian Study

Posted on: Wednesday, 10 October 2007, 09:00 CDT

In a recent study, Gordian Health Solutions' researchers set out to evaluate the financial impact of long-term population health management (PHM) programs, and found that such programs may decrease the overall cost and number of high-cost claims filed by employees. PHM programs offer services to an employee or member population, examining lifestyle behaviors, self-care issues, occupational situations and chronic condition states. The goal of PHM programs is improved health status for all participants, resulting in measurable return on investment for the employer or organization. Gordian is a leading national health and productivity improvement company, with programs representing more than 2.3 million individuals across the country. Gordian's customers include large employers, health plans and government entities.

Applying survival analysis, the study researchers were able to estimate the likelihood of PHM program participants versus nonparticipants, experiencing high-cost or outlier claims over a 78-month period. According to Adam Long, Ph.D., vice president of research and informatics at Gordian and author of the report results of which were published in the American Journal of Health Promotion, lifestyle management services such as behavior modification and education can have an immediate effect on employees' self-care, resulting in a lower number of high-cost healthcare claims. He says, "Preventive initiatives, such as those provided by PHM companies, can result in lower cumulative costs for the employer. They can also decrease the risk of high-cost or outlier claim events."

The study, titled "An Application of Survival Analysis to Population Health Management Program Evaluation," used a quasi-experimental program versus matched reference group study design. The study location was a regional hospital in Tennessee, and hospital employees with health plan benefits served as the pool of possible subjects. A total of 142 employees who were enrolled in two lifestyle management programs -- smoking cessation and weight management -- were matched with 142 employees not participating in those programs. Interventions consisted of health coaching sessions over the telephone roughly every other month.

The following are some key findings from the study:

Program participants experienced more health care claims, but significantly lower total costs, than nonparticipants. Specifically, participants accounted for over 56% of total claims, but cost their employer substantially less over the seven years. Cumulative expenses for participants were $242,465 less than nonparticipants, amounting to a per-claim difference of $40.77.

Participants were less likely than nonparticipants to experience a high-cost (>$389) or outlier (>$1,090) claim event. By month 72 of the study, nonparticipants had twice the probability of experiencing an outlier claim as participants.

The probability that PHM program participants experienced a high-cost or outlier claim was significantly delayed, compared with matched nonparticipants. The results show that program participants averaged 72.4 months to experience a high-cost claim, compared to nonparticipants' 69.5 months. For outlier claims, participants averaged 75.7 months to experience the event, compared with nonparticipants' 73.7 months.

Age and sex played important roles in the probability that subjects experienced high-cost or outlier claims. Each year of life increased the probability of a high-cost claim by 1.3% and an outlier claim by 1.6%. Males were found to be 36% more likely to experience a high-cost claim than females, and 59.7% more likely to experience an outlier claim. However, the authors caution that, although men are indeed more at-risk, these estimates may be inflated since men made up just 15% of the study population.

For more information on population health management programs and how they save employers money and keep employees healthy, go to Gordian's site at www.gordian-health.com to download the issue brief: "When it makes cents to back into the 80/20 rule." If you would like a copy of the full research article published in AJHP, send an email to along@gordian-health.com.

About Gordian Health Solutions, Inc.

Gordian is a leading national health and productivity improvement company that offers a comprehensive suite of products and services, such as population health risk analysis, telephonic lifestyle and chronic condition coaching, online products, health screenings, personal health assessments and incentive management services. Gordian helps employers, health plans and government entities identify, control and manage health risk factors and their associated costs through targeted and tailored programs, and sophisticated informatics and reporting capabilities. For more information about Gordian, visit www.gordian-health.com.

Source: Business Wire

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