COLORADO SPRINGS, CO and ST. LOUIS – August 18, 2011 – To reinforce the importance of engaging a community to lower health care costs and improve health and economic sustainability, the Center for Health Value Innovation (CHVI) has chronicled the efforts of three Colorado Springs employers that worked together to change how they were contracting for health. An organization devoted to health improvement through action, innovation and cost containment, CHVI has released a case study report to support other communities in implementing value-based benefit design, quality improvement and Outcomes-Based Contracting™ (aligning employee incentives to improve outcomes from health systems, drive higher value and offer better choices of providers).
“For the first time, we detail the thinking and benefit design changes that moved a community from waste reduction (use of inappropriate services, lack of medication adherence) through risk management (identifying gaps in care or under-managed conditions) and building individual and corporate accountability in purchasing health care services,” said Cyndy Nayer, CHVI President and CEO. “We detail the focus of the three employers, demonstrating the designs that drove success, so that other communities can follow the pathway to improved health and cost containment by focusing on engagement and health outcomes.”
The report highlights the efforts of three Colorado Business Group on Health (CBGH) members, the City of Colorado Springs, Colorado Springs School District 11 and Colorado Springs Utilities, over a five year period to improve population health and contain health cost inflation. The Colorado Springs employers measured the risk to their employees and their corporations, and then prioritized their individual efforts to change how they were contracting for health care with their plans and providers. The result was the collective influence of improved health care management in their city. Important to their success, they not only secured reduction in costs for prevention, wellness, and chronic care management, they also installed incentives for minimally invasive procedures and improvement in health care quality.
The success of these employer programs reinforces a key CHVI principle – lasting value in health improvement is driven at the community level with multi-stakeholder engagement. By highlighting the efforts and results of these employers who came together to implement value-based benefit design, other companies can learn how to build healthier businesses, healthier communities and healthier people.
CHVI has followed the efforts in Colorado Springs, documenting the maturation of the four-step process of value-based benefit design chronicled by CHVI: data, design, delivery and dividends. Levers – which include insurance plan incentives (i.e. providing a premium discount for completing a health risk assessment), stand-alone incentives and disincentives (such as a reduction in co-pays for appropriate surgical procedures, or an out-of-pocket increase to reduce use of emergency departments instead of primary care clinicians or urgent care centers) – are used for better performance and are fundamental to Outcomes-Based Contracting and building engagement across stakeholders, including consumers.
“We knew we needed to address wellness in particular, since national studies indicate that 70% of health care cost is attributable to life style, said Tamara Kirk, HR Supervisor-Benefits, Colorado Spring Utilities, and CBGH Board Chair. “As we do these types of programs collaboratively, we engage other stakeholders and create reform in our local health care system, while at the same time leveraging employers’ purchasing power.”
About the Center for Health Value Innovation (CHVI)
CHVI (501c3) is focused on the pursuit of innovation in benefit designs that improve engagement, accelerate accountability and create a predictable health cost trend. CHVI members represent over 60 million lives from all market segments in the health value supply chain, sharing the evidence of improved health and economic outcomes through value-based designs, including the Outcomes-Based Contracting™ platform for accelerating meaningful change. The Center for Health Value Innovation’s goal is to improve the health of people, organizations and communities throughout the U.S. www.vbhealth.org