Highlighting The Benefits of Its LUMINA™ Healthcare IT Platform.
North Star Health - Three Year Case Report
Feb 21, 2010 —
January, 2010
North Star Health Releases A Three Year Case Report Highlighting The Benefits of Its LUMINA™ Healthcare IT Platform.
Customer Profile:
A nationally and internationally recognized medical center based in the Southeast with nine locations across a two state region.
Business Situation:
In late 2006, the medical center re-evaluated the design and administration of their self-insured health plan which was outsourced to a Third Party Administrator (TPA). The major concern at the time was that healthcare costs had been escalating at an alarming rate over the previous year. The other major concern was the lack of support by its TPA and Broker to implement proactive measures to mitigate these costs.
Technical Situation:
According to the medical center’s HR director, their broker of record in 2006 showed up in advance of their open enrollment period with a large stack of medical claim analytics. The broker stated that they could look at it if they wanted to, but offered no recommendations on how to use the information. The information offered was a retrospective year-end analysis of the clinic’s claims history which was generated by an outsourced data analytic vendor selected by the broker.
Clearly, the medical center’s TPA had technical resources that were limited to basic medical claims processing.
Solution:
North Star Health won a competitive bid to assume the role of the medical center’s TPA beginning in January of 2007. Recommendations were to implement an incentive-based (or value-based) health plan focused on preventive health and mitigating the risk associated with chronic disease.
The primary focus of the program was to track employee compliance to nationally recognized guidelines for preventive health screenings based on an individual’s health profile.
Each member would receive an optimal screening schedule based on a Health Risk Assessment and all relevant claims data. The plan was designed to pay 100% of these required services. If plan members remained compliant, their deductible and monthly premiums were less than members who remained non-compliant. Consequences were ‘action based’ not ‘result based’, i.e., members were moved to a higher out of pocket plan if the member did not obtain a required screen, regardless of the result.
The program also relied heavily on engaging the individual plan members in part of the cost savings process. This involved having the members become more aware of how much they were spending on healthcare compared to how much their employer was contributing. Additionally, patient education materials were provided to members based on their diagnosed health issues, as well as their at risk conditions. The idea being to empower plan members to be better healthcare consumers and to take more responsibility for their health and well being.
During the center’s transition to their new health plan design, it rapidly became apparent that technology was needed to manage this type of plan more effectively. Hence, North Star Health’s development of the LUMINA™ platform with the advice and cooperation of nationally recognized health care policy expert, Dr. Ken Thorpe, founder of the Partnership to Fight Chronic Disease, who serves as Professor and Chair of the Department of Health Policy & Management at Emory University’s School of Public Health.
Currently, the medical center and its plan members have access to LUMINA™ which is a personalized health advocate that provides a road map to achieving and maintaining better health. It also contains a customized rules engine to make sure members are aware and compliant with health plan rules. For medical center management and their TPA, LUMINA™ is a comprehensive HIPPA compliant reporting tool that provides the relevant analytics to manage healthcare expenditures and track Return On Investment (ROI) for various interventions.
Benefits and Outcomes:
Over a three year period beginning in January 2007 and ending in December of 2009, the medical center experienced the following:
• Overall healthcare spending dropped 37.4% while introducing preventive healthcare costs (which amounted to 8.9% of total expenditures) and increasing plan membership by 53.9%.
• Average cost per employee dropped 59.6%.
• Compliance with nationally recognized guidelines for preventive screenings increased from 56% to 76% overall for members employed over this time period.
• The cost of implementing the LUMINA™ platform was offset by savings to the health plan over a two month period.
• LUMINA™ accurately identified that 25% of the population had either one or more chronic diseases, representing 57% of total expenditures. This knowledge allowed a more efficient and focused care management process that resulted in an overall decrease in expenditures associated with chronic diseases.
• Lastly, overall spending on compliant plan members during this time period was significantly less than non-compliant members.
Summary:
The medical center’s three year healthcare claims experience with North Star Health and LUMINA™ produced significant returns over the past three years. This success was due to a couple of factors worth highlighting.
The first was the medical center’s management embracing a proactive approach to controlling healthcare costs. This approach required investing in preventive healthcare and controlling costs related to chronic disease.
The second factor was combining LUMINA™ with the center’s incentive-based (or value-based) health plan design in Q4 of 2008. This was particularly effective in increasing compliance with preventive screenings and changing members’ lifestyle behaviors linked to the development of chronic diseases. The result created healthcare cost savings for both the members and the medical center.
About North Star Health:
North Star Health is a leading information services company that is focused on providing healthcare IT solutions to the self-insured employer market. In Q1 2009, North Star Health
transferred its TPA role to Creative Plan Administrators based in Hartford, CT in order to
focus solely on its technology offerings. It’s cutting edge software platform, LUMINA™, delivers the transparency self-insured employers and their plan administrators need to become more proactive with their health plan members to control costs and promote healthier lifestyles. LUMINA™ is particularly effective in reducing costs and improving health when linked to a value-based, or incentive-based, health plan design. It also can be used to run or audit the effectiveness of traditional cost savings efforts such as wellness and disease management programs.
The LUMINA™ platform is designed to help prevent and manage chronic diseases that account for 75% of every health care dollar spent in the United States. Most of these conditions can be prevented, delayed or minimized with proper early intervention and behavioral modification. It all begins with awareness.
For more information on how LUMINA™ can help your company reduce cost and improve health for your employees, please contact Ed O’Brien at 860.656.7956 or eobrien@cpatpa.com.