Health Plans and Employers

Health plans and employers play a major role in shaping the financial environment for the delivery of immunization services. For the private sector, decisions by health plans and employers together help determine the cost and scope of coverage available to employees.

HEALTH PLAN PERSPECTIVES

Collaboration with the Public Sector

Many children enrolled in Medicaid and in State Child Health Insurance (SCHIP) programs, such as California’s Healthy Families Program, receive immunization services through managed care health plans. Helen DuPlessis, chief medical officer for L.A. Care, reviewed some of the quality improvement activities that managed care organizations have undertaken to improve immunization rates. She also discussed the need for better collaboration between health departments and managed care organizations and others in the private sector to make more effective use of limited resources.

For managed care organizations, quality improvement activities related to immunization include the use of Health Plan Employer Data and Information Set (HEDIS) measures to assess the performance of health plans. Even though these measures have shortcomings, they have the advantage of being standardized across all health plans. Dr. DuPlessis



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Health Plans and Employers Health plans and employers play a major role in shaping the financial environment for the delivery of immunization services. For the private sector, decisions by health plans and employers together help determine the cost and scope of coverage available to employees. HEALTH PLAN PERSPECTIVES Collaboration with the Public Sector Many children enrolled in Medicaid and in State Child Health Insurance (SCHIP) programs, such as California’s Healthy Families Program, receive immunization services through managed care health plans. Helen DuPlessis, chief medical officer for L.A. Care, reviewed some of the quality improvement activities that managed care organizations have undertaken to improve immunization rates. She also discussed the need for better collaboration between health departments and managed care organizations and others in the private sector to make more effective use of limited resources. For managed care organizations, quality improvement activities related to immunization include the use of Health Plan Employer Data and Information Set (HEDIS) measures to assess the performance of health plans. Even though these measures have shortcomings, they have the advantage of being standardized across all health plans. Dr. DuPlessis

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also cited several examples of other immunization-related activities in health plans across the country. These activities include analyzing missed immunization opportunities in providers’ practices, sending immunization reminders to parents, and providing recall and reminder information to providers. Dr. DuPlessis acknowledged that the HEDIS data show the need for further improvement in immunization rates for children enrolled in Medicaid. But achieving those improvements will require better collaboration between the public and private sectors to overcome the challenges that each faces. Most health departments have a limited capacity to deliver immunization services and so must rely on health plans and private providers. Similarly, when immunization registries are not available or are not comprehensive, health departments lack real-time data on immunization coverage. Health plan records can help fill that gap. Providers could also benefit from assistance from other sources to overcome some of the challenges they face in trying to meet their obligation to provide immunization services. As noted by others at the workshop, the administrative burden in managing vaccine inventories and documenting immunization services is substantial. This includes the complications related to assessing the eligibility of children for VFC vaccine and to tracking multiple funding streams for purchasing vaccine. Staying informed about frequent changes in the immunization schedule is further complicated in California by inconsistencies between the state’s Child Health and Disability Program and Medicaid’s Early and Periodic Screening, Diagnostic, and Treatment guideline in the specifications for the timing of immunizations. Furthermore, the information management systems used by many private providers are not capable of identifying patients who need immunizations or of supporting easy use of immunization registries. Effective collaborations between the public and private sectors would help in identifying the resources that various parties can contribute to meeting immunization needs and in defining their responsibilities in that process. Dr. DuPlessis cited the effort to establish a consolidated immunization registry in northern California as a promising example of the broadly based collaborations necessary to strengthen the immunization system and improve coverage rates. Plans to expand the activities of the immunization coalition in the Los Angeles area promise to help make more efficient use of the region’s resources for immunization. Estimating Vaccine Needs Kaiser Permanente is a large staff-model health maintenance organization that purchases vaccines as well as many other pharmaceutical prod-

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ucts for use by its members. Lisa Rieg, the infectious diseases pharmacist for the California division of the organization, discussed the process of forecasting vaccine requirements and emerging concerns regarding future vaccine purchases. Kaiser subscribers receive all routine immunizations without any copayment or other additional charge, and coverage rates are more than 90 percent for many of the recommended vaccines. Kaiser also participates in clinical trials for new vaccines and in the Vaccine Safety Datalink project. An electronic database on immunization records alerts providers to immunizations that patients require and allows for production of quarterly reports on immunization coverage rates. The database also aids in appropriately allocating supplies of vaccines that are in short supply. Dr. Rieg noted that the southern California division of Kaiser Permanente has been slow to participate in VFC because of the administrative burdens associated with tracking eligible patients and the vaccine inventory. Another factor has been the inability to ensure that the VFC program will supply the vaccine products that Kaiser uses for all other members. Forecasting vaccine requirements involves consideration of several factors. It is important to understand the disease a vaccine is directed against and the risk it poses to the population Kaiser serves. Also necessary is information about a vaccine’s efficacy and safety profile, as well as its cost effectiveness. Another consideration is whether a vaccine is or will be included in the recommended immunization schedule for children or adults. Estimates of the number of doses required depend on the number of children or adults who would receive a vaccine as part of a routine schedule (e.g., an annual birth cohort for most pediatric vaccines) and whether additional doses are needed for “catch-up” programs for a newly recommended vaccine or for special efforts to improve coverage. Unanticipated factors can affect the accuracy of these forecasts. Accurately estimating the cost of a new vaccine has proved especially difficult, and most estimates have been too low. Slow acceptance of a new vaccine by providers or patients can result in lower usage, but interest spurred by clinical needs or publicity can increase demand. For example, publicity about the Lyme disease vaccine stimulated demand even though the disease risk is low in southern California. A patient education program was undertaken to inform members about appropriate uses of the vaccine. Dr. Rieg indicated that, so far, the increase in vaccine costs has been minimal compared with the cost increases for other pharmaceuticals. Kaiser has benefited from its ability to negotiate lower prices for high-volume purchases and to establish long-term contracts. However, vaccine costs seem likely to increase more steeply in the future. Prices for new vaccines, like the pneumococcal conjugate vaccine, are proving to be much higher than expected. As purchasing contracts end, Kaiser has less

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ability to influence prices because of the vaccine shortages and the smaller number of vaccine manufacturers. Looking to the future, Dr. Rieg noted concerns at Kaiser about the cost of new vaccines, especially those for which demand is expected to be high, such as multivalent pediatric vaccines and an AIDS vaccine. The possibility has been raised that copayments or other forms of cost sharing with plan members will be necessary for immunization services. At the same time, there is concern that added member costs might tend to lower immunization rates. In addition, with the current shortages of several vaccines, the stability of the vaccine supply is of growing concern. AN EMPLOYER’S VIEW OF IMMUNIZATION COVERAGE In the United States, most private health insurance coverage is obtained through plans offered by employers. Therefore, employers’ concerns and priorities play an important role in determining the coverage for immunizations available to many children and adults. Pamela Hymel, vice president for human resources at Hughes Corporation, discussed some of the factors that influence employer decisions. At Hughes Corporation, coverage for preventive care in general and immunization in particular is seen as a good investment to improve productivity. Preventive care helps reduce absenteeism by reducing illness among employees and their children and helps control costs for treatment. Coverage for immunization and other preventive services also contributes to employees’ satisfaction with their health plans. Ms. Hymel noted that large employers have public health responsibilities that they can help meet by providing coverage for immunizations. To encourage use of preventive services, Hughes Corporation tries to minimize both financial and logistical barriers. The company’s health insurance plans provide first-dollar coverage for immunizations. In addition, offering influenza immunizations at worksites makes that service more readily available to employees and reduces lost work time. Data and measurement are important for employers’ assessments of the return on their investment in preventive services. Ms. Hymel noted that for its preferred provider organization plan, Hughes Corporation currently allocates 5 percent of its spending to preventive services. With indications of an acceptable return on investment, the company would be willing to increase those benefits. Health plan reports using various HEDIS measures help employers monitor whether employees and their families are receiving useful preventive services. Employers are also able to use HEDIS measures to establish quantitative performance standards for evaluating the health plans they offer. Good data on the costs and

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benefits of preventive care can help a company make the case to other employers for investing in preventive services. As employers face increases in the cost of their health plans—Ms. Hymel reported a 14 percent increase for Hughes Corporation—employers must make decisions about the benefits to offer and the costs to pass on to employees through premiums, copayments, and coverage limits. In response to a question, Ms. Hymel noted the availability of health insurance products with a lump-sum benefit for preventive services. Although she does not favor that approach, some employers are considering it. Ms. Hymel concluded by observing that although employers are unlikely to lead immunization campaigns, they are likely to offer support based on good business reasons, such as improved productivity and lower health care costs.