Market forces restrain MCO prevention efforts
Market forces restrain MCO prevention efforts
Even as corporate America pushes managed care organizations (MCOs) into the health promotion business, competing market forces often force them to choose the traditional disease management model over a disease prevention model, says Larry S. Chapman, MPH, chairman and senior consultant for Summex, an integrated health management services company in Seattle.
"There's greater consumer interest in prevention programs, and these programs can help differentiate MCOs in the marketplace and help them compete," he says. "However, there are also some disincentives that keep some MCOs from committing to a proactive model of disease prevention."
Market forces Chapman says deter MCOs from developing health promotion programs include:
· "Free-rider" economic principle. "The free-rider principle says that if you don't have to pay to get the same benefit, you won't," he explains. "In other words, if someone else pays for disease prevention, why should you? If area hospitals offer good stress management programs, or a public health campaign promotes smoking cessation, why should the MCO invest in these programs?"
· Significantly high disenrollment rates. "MCOs see little value in improving the health of members when most programs do not yield cost savings in the first year. Why should you spend money to help reduce health risks in a member who is going to move to another MCO before you can realize the reduction in medical costs that result from healthier lifestyles?"
· Absence of regulatory requirements for prevention. The National Committee for Quality Assurance (NCQA) in Washington, DC, forces MCOs to focus on countable events rather than events prevented. "NCQA asks MCOs to count the number of diabetics in their plans and document that they receive periodic routine care. NCQA doesn't ask MCOs to count how many members at risk for developing diabetes didn't."
· Severe price competition among MCOs. "Health promotion programs cost money to develop and implement. But it's difficult for MCOs to charge an employer client an additional fee for health promotion programs when there are so many other MCOs out there wanting that employer's business," Chapman says.
Subscribe Now for Access
You have reached your article limit for the month. We hope you found our articles both enjoyable and insightful. For information on new subscriptions, product trials, alternative billing arrangements or group and site discounts please call 800-688-2421. We look forward to having you as a long-term member of the Relias Media community.