Economic Impact of a Diabetes Disease Management Program in a Self-Insured Health Plan: Early Results

Abstract

Disease management has grown to a $350 million industry with over 100 providers. Delivery models vary among providers, but short-term economic outcomes are the standard by which a program's success is generally measured. This report focuses on a large self-insured organization that offered the CarePatterns® Disease Management Program for diabetes. Individuals with diabetes were identified by pharmacy claims and invited to participate. Enrollment was voluntary (n = 2745). Medical claims history of eligible individuals who chose not to participate (control group) was used to understand the progress of these chronic diseases in the absence of intervention (n = 8978). Standard forecasting methods using medical claims data from 1997 and 1998 were used for spending projections. The study period ran from 1/1/1997 through 12/31/1999. Evaluation of 24 months of medical claims data showed that participants in the program had higher direct healthcare costs than nonparticipants. Actual medical expenditures for participants decreased by $747 (9.4%) from the baseline period (1998). When participants' 1999 actual spending is compared to 1999 projected medical spending, savings are $1474 (17%) per participant. Conversely, nonparticipant control medical spending increased by $230 (3.3%) per individual. Pharmacy spending for participants increased 23.5% from Baseline to 1999. For nonparticipant controls, pharmacy spending increased by 19.7%. Although further analysis is required to determine which component of interventions significantly contributed, an effective patient-focused disease management program is an important factor in promoting the appropriate use of pharmaceuticals and medical resource utilization.