The short-term approach to chronic illness costs

Reducing cost is a critical element for business.  For many industries, this might take the form of a technology or services solution to reduce cost in a strategic area of business.  In many cases, the justification is straightforward.  Does the new solution or service reduce cost, improve productivity, or help with a strategic goal?  In other words, what are the hard and soft savings associated with the solution?  In addition, many of these cost inputs are predictable – making it easy to develop an ROI and quantify the value.  If you hit certain thresholds, you implement the solution and capture the improvements.

In market segments with high cost and waste, transformative technology and services solutions can generate substantial revenues for vendors, while delivering significant savings for the client.  This dynamic attracts competitors who go to market with similar solutions.  Pricing becomes more competitive with each new product release (or contract renewal) because the new efficiencies are chasing after a smaller pool of potential savings.  The easy cost reductions have already been captured.

For healthcare this occurs quite frequently.  New medical equipment, diagnostic tests, and  drugs are created and sold to lower costs and improve outcomes.  This process works very well when the inputs can be consistently quantified.   The issues start when you add patients into the mix.

Chronically Ill Populations are not very cooperative

Let’s examine the patient population with chronic kidney disease (CKD).  Our government spends about $120B per year on Medicare patients with CKD.  These patients come from all walks of life and can vary greatly in terms of how well they manage their condition.

The standard course of treatment seeks to slow the progression of the disease by adhering to the following:

  • Controlling blood pressure, anemia, cholesterol and fluid retention through medications
  • Reducing albumin in urine
  • Eating a healthy diet
  • Maintaining a healthy lifestyle

The treatment path is consistent for pretty much every CKD patient.  Yet research has highlighted the following issues:

  • 37M people in the US have CKD.
  • 90% don’t realize they have it.
  • For those who do know, one-third to one-half have low medication adherence which is correlated with drug related problems and adverse events.
  • Many have barriers to eating a healthy diet or maintaining a healthy lifestyle, a key component in treatment.

Panic sets in!

Historically, there have been limited efforts to reduce the overall cost.  Healthcare systems billed the fee for service and Medicare paid for every procedure or test – which doesn’t give much incentive to change.

Not anymore.  The total spend on chronic illness is now so astronomical, our government is launching a variety of chronic illness initiatives to pay for performance and outcomes.  Including CKD.  Now healthcare systems are highly motivated to identify and implement solutions to help them address cost and outcomes for CKD.

Vendors are responding with solutions that seek to drive down costs for CKD populations.  Most of these solutions appear to focus primarily on the operational and clinical aspects of chronic illness.  They provide operational reporting to healthcare systems that documents care performance (and clinical information to doctors) to better support care.

Everyone raises their hands

Established medical vendors announce a kidney care program.  Startups jump in with solutions based on algorithms created by Data Scientists.  The approach might vary a bit, but the main claims are remarkably similar:

  • “We have the best data scientists and algorithms that will help identify the key populations that need to be targeted for treatment.”
  • “We can identify the undiagnosed populations so you can intervene with a treatment path that prevents progression of the disease.”
  • “We can identify high risk patients to reduce expensive medical events.”

They may also provide some form of care management teams, remote monitoring, or a push to home-based treatments instead of clinical dialysis.

Why it breaks

These solutions do provide value.  Because of the waste and spend associated with treating chronic kidney disease, invariably there is some initial success.  Previously undiagnosed patients are identified and funneled into treatment before their disease progresses.  Some portion of the high-risk patient population is identified, and an intervention avoids an expensive medical event.  The issue is that savings are likely generated by a small segment of the overall patient population.

Why?  Because you aren’t working with the entire population of CKD patients.  Studies show one-half to two-thirds of CKD patients have high adherence to medication protocols.  These patients are engaged with their treatment plan.  The opportunity lies with one-half (or fewer) of the patients who have low medication adherence.  This is important because low medication adherence is correlated with disease progression, higher costs and worse outcomes.  They may also have health literacy issues and even socioeconomic barriers impacting their medication adherence.  And another whole segment just plain don’t care enough to manage their health.

These new solutions onboard newly diagnosed patients and identify high-risk patients.  They help coordinate treatment to yield some savings and improved outcomes which is deemed acceptable.  The problem occurs when you get to year two.  The low hanging fruit has already been picked.  These solutions now transition to maintenance.  They provide operational reporting to the healthcare system to help maintain improvements and identify a smaller subset of undiagnosed patients.

One day we will have to face the music

All these improvements are great, but these solutions don’t appear to document the barriers preventing higher levels of adherence in the entire patient population.  Are there health literacy barriers involving language, education or culture?  Are there socioeconomic barriers like treatment cost or transportation?  Even worse, higher levels of non-adherence exist in minority populations.  How do these solutions help document and address these barriers?  The answer is:  they don’t.

The current solutions represent a good starting point.  They’re effective by pulling critical information out of patient data that provides healthcare systems operational reporting, and clinical information that identifies the target patients who are the biggest problems.  Given the current capabilities of these solutions, how will they respond if Medicare decides to raise the bar on performance?  Because you can only pick so much low hanging fruit before the performance improvements become harder to achieve using the same approach.

Non-Clinical Data is Key

Treating CKD using these new solutions highlights why we need a longitudinal patient record which includes clinical AND non-clinical patient data.  Using clinical data to identify and treat undiagnosed and high-risk CKD patients is a good first step.

Our long-term goal should focus on improving treatment for every CKD patient.  This means expanding these solutions to identify and address the non-clinical reasons why patients struggle with their CKD treatment:  health literacy barriers in language, education, and culture, as well as socioeconomic barriers affecting access to treatment.  Adding a layer that improves health literacy and addresses socioeconomic barriers will help the entire population of CKD patients, not just the undiagnosed or high-risk patients.  That’s real value you can build on year after year.

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