After years of raising co-payments and deductibles for prescription pharmaceuticals, some employers are taking an unorthodox approach to lowering health-care costs in an experimental program by get this paying for diabetes drugs and consultations.
For patients the savings could amount to $2,000 a year.
If the program proves successful it could be expanded to include other common diseases and chronic conditions such as asthma, depression or arthritis and extended beyond its one-year pilot phase, according to the Midwest Business Group on Health, a Chicago-based coalition of employers that is coordinating the program.
Nationally, more than 30 employer groups are rolling out similar programs this year in cities including Milwaukee, Pittsburgh and Los Angeles.
Results from a model project launched in 1997 by the city of Asheville, N.C., show a 50 percent reduction in sick days and no worker's compensation claims filed by the diabetes patients in the program between 1997 and 2003.
Asheville has expanded its program to people with asthma and high blood pressure.
So far, Chicago-area employers Pactiv Corp., the City of Naperville and the Jewish Federation of Metropolitan Chicago have agreed to participate in the program.
"Employers are beginning to realize that cost-shifting by itself will not change behaviors," said Larry Boress, chief executive of the Midwest Business Group on Health. "This is not just an isolated incentive where you are giving away trinkets or dollars but is part of a change in employee-benefits strategy to move people away from an entitlement mentality. The idea is that in order to change employee behavior and change the attitude in the way employees manage their health, employers are moving to value-based benefit designs."
Direct and indirect costs of diabetes to the U.S. health-care system are more than $130 billion a year, including emergency room visits, extended hospital stays and absenteeism, the Chicago group said, citing national studies. Some 20 million people have diabetes.
By waiving the so-called co-payment or co-insurance, employers who are part of Chicago's program are hoping that people will take better care of themselves and avoid costly hospitalizations. Inadequate treatment can lead to blindness, amputations of limbs or even death. More than 200,000 Americans die of diabetes-related complications each year.
Diabetics need greater attention partly because they usually take 7 to 12 prescriptions regularly for the disease and related conditions, and that makes compliance difficult.
"As a patient group they are one of the most highly medicated groups because they frequently have other conditions like obesity, high cholesterol and high blood pressure problems and vascular issues," said Dr. James Webster, an internist and president of the Chicago Board of Health, the governing body of the Chicago Department of Health. "It's a lot of medication to keep straight. They have to be encouraged to take their medication and know what the medication is for."
Chicago program participants, who are expected to number about 100 at the outset, will be matched up with pharmacists who will be paid undisclosed fees for private consultations.
"The pharmacist's role is to be an educator and motivator, ensuring the patient follows their physician's orders and understands how to manage and monitor their diabetes and medications," Boress said. "Studies have shown that with the treatment, education and motivation provided by this program people can dramatically improve their health while positively impacting employer health-care costs."
The Illinois Pharmacists Association has trained about 50 pharmacists to work with the program's diabetics.
"It's different than a consultation at the pharmacy counter because all of the meetings are done, face-to-face, by appointment and in private counseling areas ... this is not done at the drive-through window," said Dan Garrett, a pharmacist and senior director of medication adherence programs for the American Pharmacists Association Foundation, which has been involved in similar programs in smaller markets.
Doctors will be given results of the consultations and provide information to a "research unit tracking the patients' medical and cost trends," the Midwest Business Group said.
The Chicago employers are hoping to do as well as smaller markets, such as Asheville, which started out with 46 diabetes patients covered by two employers' health plans. It has expanded to more than 1,000 patients from five employers who are enrolled for diabetes, asthma, high blood pressure and lipid therapy management, the foundation and Midwest Business Group said.
"The patients sign up and they are assigned to a specific pharmacist and that is the pharmacist who is going to be the pharmacist coach on an ongoing basis," said Garrett, who was involved in the Asheville project. "Once that relationship is established the patient will meet every month initially, then every two months. At a minimum, for the patient to continue to have a waived co-pay they have to meet with a pharmacist at least quarterly."
A financial incentive for the employee coupled by close monitoring are reasons it should work, the Chicago Board of Health's Webster said.
The program differs from other employee wellness initiatives such as corporate health fairs, newsletters and e-mail reminders, which have not slowed the increase in employer-paid and worker insurance premiums.
"If this is a successful model then it can be applied to almost any condition where medication compliance is a key factor in improving someone's health and quality of life," said Midwest Business Group's Boress.
Pactiv, the maker of Hefty garbage bags, is interested in expanding the pilot program beyond Illinois. "Pactiv is making this program available to its employees enrolled in PPOs in Illinois and will consider adding additional states as the program expands," said Judy Hearn, the company's manager of health and welfare.
Such programs could be a boost to makers of diabetes drugs, who are helping to underwrite administrative costs.
British drug giant GlaxoSmithKline PLC, for example, is providing financial support to the American Pharmacists Association Foundation through a grant to underwrite costs for enrollment forms and guidelines for counseling sessions.
However, drugmakers are not able to influence the outcome of the study, pharmacists and employers involved say.
"There is no money that flows to any employer from a drugmaker," Garrett said. "The employer's commitment is to provide the waived or reduced co-pays and paying the pharmacists."