Thursday, March 4, 2010
More Monitors, More Waste
"A decade ago General Electric experimented with a promising approach to employee health care known as disease management. ... 'It seemed too good to be true,' says Dr. Robert S. Galvin, GE's chief medical officer. And he adds, it was. ... Disease management [DM]--depite a series of studies finding that it doesn't deliver what it promises--has caught on throughout the business world (BW-Feb. 1 & 8). ... Companies marketing [DM] counter that in-house research shows such services sharply reduce costs. ... But outside analysts say the case for [DM]--and the data its marketers emphasize--typically rely on exaggeration and ignore the cost of the service itself. ... In August 2009, Rand [Corp.] issued a report for the state of Massachuetts concluding that [DM] Could increase employer and government spending in the state by $6.7 billion over 10 years with little overall benefit. ... One reason: A lot of preventive attention ends up directed at relatively healthy people who wouldn't require hospitalization anyway. ... The vast discrepancy between the contentions of [DM] companies and those of critics stem from different attitudes toward projections. .. About three-quarters of large companies offer some form of [DM] services, as do most state Medicaid programs for the poor. ... In Washington there is bipartisan support for allowing employers to grant bigger incentives to employees who participate in [DM]. ... Healthways ... was one of the eigt that participated in the 3-year Medicare pilot that ended in 2008. Medicare paid the [DM] providers about $360 million in fees, but outside consultants found no evidence of improved outcomes. ... At GE, [DM] didn't work on a broad scale, according to Galvin, who was a primary-care physician for 10 years before joining the company. ... The program failed, Galvin says. GE struggled to get enough enrollment to justify the cost, and those who did enroll rarely responded to the nurses. For much of the past year, the providers have been promoting their wares in Washington. Healthways officials say they've lobbied fiscally conservative democrats who are swing votes on health reform legislation. Their claim that prevention programs could save Medicare $652 billion over 10 years reflects industry assumptions that [DM] would dramatically increase the percentage of healthy seniors entering Medicare at 65 and keep them fit for yeas to come", Chad Terhune and Arlene Weintraub at Businessweek, 15 February 2010, link: http://www.businessweek.com/magazine/content/10_07/b4166046292556.htm.
DM looks like another boondoggle. Like say the PCAOB, or much of CPA firm auditing which doesn't pay for itself. Or "portfolio monitoring services".