Measuring the Economic Value of Disease Management Programs

Abstract

programs, analogous to the much more rigorous statistical research Incidentally, the per-member-per-month costs associated with term ‘number needed to treat’ (NNT).[2-4] The former term atdiabetes-only disease management programs can be far lower or tempts to use estimated program savings derived from average even higher depending on program design. A sweet spot for hospitalization cost reductions alone to justify (or not) the program disease management generally has been proposed but is difficult to costs of a proposed disease management program. The original quantify.[5] Given the widespread variation in disease definition article, published in April 2006, first introduced this concept and and actual initiative elements at the program level, creating generreceived considerable reaction in the industry.[1] The article sugalizations here is fraught with limitations. gested that disease management efforts would need to have very Actually, diabetes, as a choice, is an interesting example in significant impacts on inpatient utilization in order to justify their itself; financial analyses of the DCCT (Diabetes Control and cost. The current text also goes on to suggest that other intervenComplications) trials recognized that costs may even go up for tions provided at costs lower than expensive professional services properly-managed patients with diabetes in the short term when might help (without referenced justification), and that alternative compared with usual care.[6] However, the substantial benefits evaluation methods such as cost-effectiveness analyses using qualobtained across a number of other axes and the likely long-term ity-adjusted life years (QALYs) might be at least part of an answer health and financial benefit clearly overwhelmed the more simple to the problem created by this metric. Lowering costs might thus financial-only analysis when this was reviewed. improve the return on investment (ROI) potential. So how should one look at the economic case for diabetes There has been widespread controversy in the literature for a disease management programs? The industry is increasingly number of years regarding the proper method of calculating a favoring a multidimensional approach that examines impact from narrowly defined financial impact of disease management (and, a variety of directions; Dr Linden is aware of this approach.[7,8] more broadly, medical management) programs. In disease manIn terms of clinical quality outcomes, the delivery of improved agement, the issue is particularly acute since the high cost variacare has been linked to enhanced economic outcomes through tion at the member level in these conditions makes it difficult to reduced future costs,[6] improved productivity,[9] and reduced medshow statistical significance for all but large populations of paical care costs.[10] Improvement in clinical quality itself has multitients. The economic business case for medical management prople links to other outcomes in terms of physical well-being, grams is clearly more complex than the approach recommended activities of daily living, and enhanced productivity at work. and requires a multidimensional approach to valuation. Focusing a