New Product for Group Health Cases!!

[leevena]

So at what cost point would a program like this make sense? Would it be at the point where the anticipated savings to the employer and employee (in terms of saved insurance claims, increased productivity to the employer and decreased future premiums due to lower utilization) exceeded the cost of the program on a long-term basis? We are going to see more of these types of programs in the future as employer plans look to save money. I noticed that Assurant currently includes a telemedicine product with their major-med plans here in TX...while Assurant isn't a huge player in the major-med market, it's a start of things to come, I think.

This type of product will not save any significant claim dollars nor reduce rate changes in future. Average American goes to the doctor 4 times per year, so how many of these visits do you expect to eliminate. On top of that, physician visits costs are not the major contributor to claim costs.

Productivity is a grey area-how do you connect the phone call to productivity savings? Very difficult to do this.

 

[Josh]

I'm going to guess somewhere around $1 pmpm, but that's a total crap shoot, it might even be as high as $2 pmpm. I'm sure some actuary knows the answer to this though.

 

[leevena]

I'm going to guess somewhere around $1 pmpm, but that's a total crap shoot, it might even be as high as $2 pmpm. I'm sure some actuary knows the answer to this though.

Let me see if I have this right. You want someone to pay $30 per month per employee for this coverage and you expect the savings to be somewhere around $2 pmpm?

Let's look at it a different way. If an employee has this coverage and uses it once a year, the cost is $380 ($30 per month plus the $20 costs for the call--I believe it's $20). Assume I saved an office visit out of that. What kind of cost is associated with that office visit...$100-150? Remember, since it was taken care of over the phone, it was probably not a significant issue, so the office visit cost would be low.

 

[BrokerGal]

I agree with Ann - I'm having a very hard time picturing scenarios where this product would be useful. Maybe the original poster can give us some examples of medical situations the teledocs are equipped to handle.

I'm not convinced a telemed doc should be or would be willing to prescribe antibiotics. This rules out pink eye, strep throat, sinus infection, urinary track infect and ear infection.

I don't think a telemed doc would treat any kind of reactive airway/asthma issues either without being able to get oxygen stats, ruling out pneumonia with an xray, etc.

Those are the kind of after hours calls I've made with my kiddos over the years, and I don't really see how the product could eliminate those trips. I'm not seeing the value...

I don't see this product going anywhere for groups or individual/family plans. Initiation fee of $100, monthly fee of $30 ($40 for IFP), and $20 per consultation. Even for the group plan, which he says waives some of those fees, it doesn't make sense to me.

I've heard it said that claims can be divided into 3 categories - those who use $500 or less of medical expenses (a high number of us), those who use catastrophic amounts of medical services (a small number of people, but the dollar amount drives the premium sky high), and those who use a medium amount of $5,000 or less (very few). Let's look at this telemedicine thing for all 3 categories. Let's look at its function and at the math.

Is the $500 a year user going to benefit from this? No. Can the telemedicine doc do a routine physical, pap smear and mammogram? No, not even if any woman would allow it. The teledoc can't do preventive routine appointments. How about the common stuff like looking in a child's ears for ear infection? Nope, can't do that by phone or video conference. Functionally, this arrangement has very little benefit for the "under $500 a year" user. Mathematically, why would any family pay $360 to $480 a year (plus any initiation fee and consultation fees) to avoid a few copays?

Okay, how about the catastrophic level utilizer? Telemedicine chemotherapy anyone? Tele heart attack? This benefit is useless to them. If a cancer or heart patient called teledoc, that doc is going to tell him "get to the ER" no matter what the phone call is about. The teledoc won't want the liability. What function would telemedicine have for this type of patient? Mathematically, what would it save them, since they undoubtedly meet the deductible & out-of-pocket maximum anyway?

And lastly, the medium user. These usually entail a simple outpatient surgery and some advanced imaging before surgery is indicated - such as MRI, CT Scan, Colonoscopy, etc. Broken ankle, need an MRI and surgery. What good does a teledoc do? Do you stick your ankle up to the webcam so he can see if it's broken versus sprained? Intestinal problems, perhaps. Tele colonoscopy?? Really.... Let's say you're considering going to the ER, but you call a teledoc instead. What will he tell you? He'll probably say to go to the ER or urgent care.

Lastly, isn't "call a nurse" pretty much standard (and FREE) on most health plans? What does "call a doctor" really do that "call a nurse" doesn't do, except prescribe medicine?

 

[wave828]

Let me see if I have this right. You want someone to pay $30 per month per employee for this coverage and you expect the savings to be somewhere around $2 pmpm?

Let's look at it a different way. If an employee has this coverage and uses it once a year, the cost is $380 ($30 per month plus the $20 costs for the call--I believe it's $20). Assume I saved an office visit out of that. What kind of cost is associated with that office visit...$100-150? Remember, since it was taken care of over the phone, it was probably not a significant issue, so the office visit cost would be low.

what if the cost was $10 per employee AND family ($10 for all)?
$120 per year
Average family has 3.1 members
Average office visit of $85 saved per call
If 1/2 of office visits were "saved" by this program, here's the numbers....

Using 3 visits per person per year with 50% of these visits now taking place over the phone....
1.5 visits per person saved
$85 per visit, $127 saved per person x 3 people per family = $381 saved.
Less: cost of program at $120 premium + ($20 phone call x 4.5 calls) = $120 + $90 = $210 cost

$381 savings - $210 cost = $171 saved per family per year...

If employer has 500 employees (and families insured), this is $85,000 in reduced cost for claims for doctor office visits, plus increased productivity for employees who don't have to leave the office to take their 3 year old to the doctor for the 4th time for strep throat (@ 3 hours wasted time to do so when the kid gets sick)....

The question is, would a self-funded plan be interested in saving $85K on their health care costs in an example like this, given that they may spend $5K per year per family in health care costs (total of $2.5MM for the year, which would be a savings of about 3.5% in this example)?

BTW - the price quoted at $30 per person would have to be retail pricing...wholesale pricing would be more appropriate for groups, which takes us to the $10-$12 level (eliminating the adverse selection problem you have with individual retail pricing).

 

[leevena]

what if the cost was $10 per employee AND family ($10 for all)?
$120 per year
Average family has 3.1 members
Average office visit of $85 saved per call
If 1/2 of office visits were "saved" by this program, here's the numbers....

Using 3 visits per person per year with 50% of these visits now taking place over the phone....
1.5 visits per person saved
$85 per visit, $127 saved per person x 3 people per family = $381 saved.
Less: cost of program at $120 premium + ($20 phone call x 4.5 calls) = $120 + $90 = $210 cost

$381 savings - $210 cost = $171 saved per family per year...

If employer has 500 employees (and families insured), this is $85,000 in reduced cost for claims for doctor office visits, plus increased productivity for employees who don't have to leave the office to take their 3 year old to the doctor for the 4th time for strep throat (@ 3 hours wasted time to do so when the kid gets sick)....

The question is, would a self-funded plan be interested in saving $85K on their health care costs in an example like this, given that they may spend $5K per year per family in health care costs (total of $2.5MM for the year, which would be a savings of about 3.5% in this example)?

BTW - the price quoted at $30 per person would have to be retail pricing...wholesale pricing would be more appropriate for groups, which takes us to the $10-$12 level (eliminating the adverse selection problem you have with individual retail pricing).

Your assumption of $10 per person is wrong. The original poster said the cost was $30 per month + $20 per call with an doctor. Your assumption of 3.1 per family is also too high. It usually runs around 2.5 or less.

Your assumption of how many visits would be diverted to the telephonic doctor is very high. The type of call going to a telephonic doctor (primary care doctor) will be for less sever issues, for example, my 1 year old fell and hit her head, no bleeding but a bump, what do I do? The more serious health situations will generally not use this.

 

[BrokerGal]

Please tell us specifically what kind of illnesses/situations the call center has treated in the past. They aren't going to dispense pain meds as this would be a huge liability. I think there would be hesitation (and there sure should be) in prescribing antibiotics which would rule out using them for a multitude of issues. The doctor can't look at a bump on the head or check on a spider bite or listen to someone's lungs for pneumonia...I've eliminated every urgi care visit of ours in the past 5 years.

If I use the phone nurse, it is generally an extension of a previous visit. For example, my daughter had pink eye and the first prescription didn't work. The nurse has all her records and can verify the diagnosis and previous RX and call in something new. This is FREE. I don't need to call in the middle of the night. If the office was closed, I would simply wait until morning. Our doc won't diagnose a new issue over the phone, the call nurse will always make an appt for you - for good reason.

What exactly is this doc set up to handle? Sorry, but I would never spend money on this and I don't see where it would reduce overall doctor visits.

what if the cost was $10 per employee AND family ($10 for all)?
$120 per year
Average family has 3.1 members
Average office visit of $85 saved per call
If 1/2 of office visits were "saved" by this program, here's the numbers....

Using 3 visits per person per year with 50% of these visits now taking place over the phone....
1.5 visits per person saved
$85 per visit, $127 saved per person x 3 people per family = $381 saved.
Less: cost of program at $120 premium + ($20 phone call x 4.5 calls) = $120 + $90 = $210 cost

$381 savings - $210 cost = $171 saved per family per year...

If employer has 500 employees (and families insured), this is $85,000 in reduced cost for claims for doctor office visits, plus increased productivity for employees who don't have to leave the office to take their 3 year old to the doctor for the 4th time for strep throat (@ 3 hours wasted time to do so when the kid gets sick)....

The question is, would a self-funded plan be interested in saving $85K on their health care costs in an example like this, given that they may spend $5K per year per family in health care costs (total of $2.5MM for the year, which would be a savings of about 3.5% in this example)?

BTW - the price quoted at $30 per person would have to be retail pricing...wholesale pricing would be more appropriate for groups, which takes us to the $10-$12 level (eliminating the adverse selection problem you have with individual retail pricing).

 

[Josh]

Let me see if I have this right. You want someone to pay $30 per month per employee for this coverage and you expect the savings to be somewhere around $2 pmpm?

No, I think it would have to cost around $1pmpm for there to be a savings, maybe $2pmpm. At $30/month I don't think it makes any sense based on using the cost savings argument.