Costs Of Care Primer

Harnessing Decision-Support Systems to Deflate Medical Bills Neel Shah Executive Director Mary Zarkhina VP Research

The Opportunity Every 30 seconds medical bills bankrupt an American family Doctors decide what goes on the bill Many commonly ordered tests and treatments do not improve health outcomes

The Opportunity “ We seem to have as much as $700 billion a year in health care tests and services that are unnecessary, that don't improve health outcomes, and that just add to costs ... The way to get at that has been started in the stimulus bill in which we invest [$20 billion] in health information technology , we start to better measure what works and what doesn't, and we start to pay for better care rather than more care.” Peter Orszag, Director of the White House Office of Management & Budget. February 19th, 2009

Medical Decision-Making Safety Efficacy Cost

Top-Down Solutions “ Nonclinical” Administrators Clinical Healthcare Providers information
Managed care
Pay-for-performance

Bottom-up solutions
Consumer-Driven Healthcare
Decision-support systems
consumer agency
consumer capacity
provider autonomy
price transparency
Limitations

Our Solution Transparent price information at the point of care
Sensitive to provider workflow
Sensitive to health delivery business operations
User-interface Decision support

Our Solution Transparent price information at the point of care Cost Charge Price
Hospital accounting ledgers
Payer claims databases
reconciled estimate

Display Transparent price information at the point of care
Coded order-of-magnitude
Displayed in the order-entry menu

Displayed explicitly when quantifiable, else a referenced clinical guideline
Displayed in a second-level box

Coded with a provided benchmark
Displayed with efficacy in a second-level box

Setting: Emergency Room Transparent price information at the point of care
Emergency rooms operate in deficits
Patients are most likely to be underinsured
Physicians are salaried
Workflow incentivizes formulaic ordering

Value Chain Costs of Care services Physicians (target) Patients (1 ° beneficiary) Emergency Rooms (2 ° beneficiary) Healthcare System (3 ° beneficiary)

Our Goals Costs of Care services Physicians (target) Patients (1 ° beneficiary) Emergency Rooms (2 ° beneficiary) Healthcare System (3 ° beneficiary)
Drive a paradigm shift in medical decision-making towards cost awareness
Prevent personal bankruptcy caused by medical bills
Create a “bottom-up” approach to curbing cost-growth

Measuring Impact Costs of Care services Physicians (target) Patients (1 ° beneficiary) Emergency Rooms (2 ° beneficiary) Healthcare System (3 ° beneficiary)
Provider practices
Patient benefits
System-level benefits

Our Theory of Change All doctors should understand how the decisions they make impact what patients pay. We believe that drawing an explicit link between these decisions and the potential to bankrupt the patient in front of them will induce doctors to consider costs. We believe doctors who consider costs will continue ordering tests and treatments patients need to get better, but will be less likely to order superfluous tests that inflate medical bills unnecessarily.

Our Strategy: Nonprofit Learning Enterprise
6 month pilot in a local emergency department
Academic medical center
Safety net hospital setting
Start-up through research grants
Aligned private foundations and government RFPs
Analysis of provider cost-sensitivity

Our Team Neel Shah MD, Executive Director Mary Zarkhina, VP Research Jeff La Fave MBA, VP Finance Devin DeCiantis BBA, VP Strategy
Former Harvard Law Health Policy Fellow
Inaugural MHDC Elliot Stone Fellow
MD and MPP candidate, Harvard Kennedy School of Government
Worked in health management and IT consulting at Accenture
Conducted a utilization and profitability analysis in academic emergency department
Master of Health Policy and Management candidate, Harvard School of Public Health
Former cost analyst, Congressional Budget Office
Former manager of citywide consumer credit education campaign
Two former business degrees and MPP candidate, Harvard Kennedy School of Government
Worked as a strategy consultant for McKinsey & Co.
Former investment banker, UBS
Managed digital media for the Walrus Foundation
MPP candidate, Harvard Kennedy School of Government

Thank you

© Copyright 2009
This confidential publication is the property of Cost of Care, Inc. No part of this presentation may be reproduced, translated into another language or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written consent of Cost of Care, Inc….
Some or all of the information contained herein may be protected by patent numbers……….
All other trademarks are owned by their respective owners……

Costs Of Care Primer

by Neel Shah on Feb 18, 2010

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Costs Of Care Primer — Presentation Transcript