High Costs Discourage Participation In Disease Management Programs
When copayments are levied for participation in disease management programs, patients may underuse recommended services, thereby decreasing the effectiveness of these programs, according to a study published in the March issue of the American Journal of Managed Care.
In "Rising Out-of-pocket Costs in Disease Management Programs," researchers Michael E. Chernew, Allison B. Rosen, and A. Mark Fendrick observed that the rise in cost sharing for patients at the point of service and the proliferation of disease management programs are two of the most prominent trends in health benefit design. Cost reduction is among the primary aims of each of these approaches. The authors expect increased cost sharing to lower premiums and encourage more cost-effective choices by consumers, while they predict disease management programs will reduce aggregate expenditures by improving health.
The study was based on data collected from two large health plans with large, well-established disease management programs. From one plan, researchers examined longitudinal data from 2001–2003 for participants in the plan’s congestive heart failure (CHF) and asthma disease management programs, as well as from the plan’s overall population. From the second plan, the authors looked at 2003 data from participants in the plan’s diabetes mellitus management program and from other plan members. The authors said they chose to focus on copayments for prescription pharmaceuticals because medications are an important component of therapy for the chronic illnesses targeted by disease management programs, and the trend toward patient cost sharing has been particularly pronounced in the area of prescription drugs.
The analysis showed that, for the first plan studied, the proportion of prescriptions with a copayment of more than $10 rose steadily between 2001 and 2003 from about 25% to 40%; a comparable upward trend for copayments was observed in the $5 to $10 range for the purchase of generic medications. The authors concluded that there was no evidence to suggest that disease management program participants in the first plan had appreciably lower copayments than other plan members. For the second plan studied, disease management program participants were found to pay only slightly less for medications than individuals not enrolled in programs.
Researchers added that, when they contacted experts in the disease management and insurance industries to ask whether they believed copayments for disease management program participants differed from copayments for plan members outside the programs, the overwhelming response was that the copayments were the same with the exception of a few individual employers.
The authors observed that, while there may be merit in cost sharing in certain instances, it does not make economic sense to combine greater cost sharing with disease management. "If patients in the groups targeted by disease management face greater cost sharing, their consumption will be farther from the efficient level, and more disease management resources will be needed to move them to the appropriate level of care," the authors said. "Hence, cost sharing and disease management result in conflicting approaches to benefit design, effectively working against each other."
The optimal benefit design, researchers concluded, would align the incentives created by cost sharing and disease management. Economic models would suggest, the authors added, that copayment rates for individuals in the high-risk subgroups should be set to zero. It may even be beneficial for disease management programs to offer financial incentives.
