Don't take DM reports at face value

June 1, 2010

How can plans know they're getting the most value for their money in disease management and wellness programs?

WELLESELY, MASS.-While it can be difficult to prove the value of disease management and wellness programs, employers and health plans spend millions of dollars each year on such models. How can plans know they're getting the most value for their money?

It's a question that is becoming less difficult to answer.

Plans might hire an independent third party to examine disease management programs, but questions often arise about whether the metrics used in the examination of outcomes are valid. Simply trusting the source is often not good enough.

DMPC validates disease management and wellness outcomes for health plans, employers, vendors and benefit consultants. Lewis, the founder, now offers to provide an "auditor's letter" for each program evaluated by DMPC with a guarantee of up to $100,000, attesting that the methodology used to calculate the results is valid.

"When you write an auditor's letter, you take a lot of liability risk," Lewis says. "If what I'm saying is not true, I am liable for a five- or six-figure sum of money."

He compares this initiative to an annual report of a publicly traded company, which must include an auditor's letter attesting to the accuracy of the numbers.

"It is no longer adequate for a benefits consultant or health plan to say, 'Trust us; it is valid.' The bar has been raised," he says.

The guarantee will generally be based on an analysis of outcomes validity using a DMPC-developed methodology to track adverse medical events. Several health plans, vendors and benefit consultants currently use the methodology. By counting all events, as opposed to just counting events that take place among the population identified in the baseline, the methodology avoids a common mistake that is known as regression to the mean.

DMPC will review a program's outcomes report, check the validity against the acceptable methodology, and provide the letter, if applicable.

MAKE BETTER JUDGMENTS

Thomas W. Wilson, founder and chairman of the Population Health Impact Institute, a not-for-profit organization, says transparency of evaluation methods ultimately benefits the consumer because transparency will encourage the development of more efficient and effective programs. In the near-term, he adds, such transparency benefits the payer.

"The purchasers of [disease management and wellness] programs will be able to make more evidence-based decisions when the evidence they are looking at is more transparent," Wilson says. "Payers can look at several vendors, and even if they are claiming different outcomes and using different methodologies, if there is transparency, payers can make the best possible judgment."

Lewis says vendors who deliver the best-in-class programs do save plan sponsors money, and the DMPC auditor's letter will help create a culture in which payers will be able to identify those programs easily.