Healthcare Reform: Potential Impact on the Healthcare Unbound Technologies Market
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1 Healthcare Reform: Potential Impact on the Healthcare Unbound Technologies Market Majd Alwan, Ph.D., VP Center for Aging Services Technologies (CAST), American Association of Homes and Services for the Aging (AAHSA) 7 th Healthcare Unbound Conference July 19-20, 2010 San Diego, CA.
2 Healthcare Unbound Technologies Remote Patient Monitoring/ Telehealth/ e- Health Technologies Behavioral/ Wellness/ ADL/ Functional Assessment and Monitoring Technologies Safety Monitoring/ Personal Emergency Response Systems Professional Services enabled by the technology.
3 Adoption of Healthcare Unbound Technologies Only 21% of home health and hospice care agencies use telemedicine capabilities. Of these agencies: 90% used telephone monitoring 66% used non-video monitoring 1 PERS subscribers < 2M No accurate estimate available for ADL monitoring. 1 Resnick HE, Alwan M. Use of Health Information Technology in Home Health and Hospice Agencies: United States, Accepted for publication in Journal of the American Medical Informatics Association (JAMIA), 2010;17:
4 Business Model Realities Stuck in legacy reimbursement/ payment mechanisms Critical need for integrated socio, cultural, economic model of care; may evolve more quickly in other countries Promising aspects of current models (VA, Kaiser, PACE, P4P, etc.), exist but hard to generalize to other systems Medicaid related programs are evolving more quickly due to extreme pressures.
5 Healthcare Reform Bill Certified EHR Grant Program for Long-term Care Facilities Demonstration Project for Use of HIT in Nursing Homes Development of Medicare Part D Prescription Dispensing Techniques in LTC Facilities New Models of Care that leverage Technology Use of Technology in New Cost Efficient Payment Models-Center for Medicare and Medicaid Innovation Use of HIT in Health Homes for Enrollees with Chronic Conditions Use of Technology in New State Options for Long- Term Services and Supports The Community Living Assistance Services and Supports Act (CLASS Act).
6 What is CLASS? Voluntary, federally-administered, consumer-financed insurance plan The plan provides enrollees who have functional limitations, with cash benefit to help pay for needed assistance in a place they call home from independent living to a nursing facility The benefits can be used in any way they choose.
7 When does it become effective? Most provisions of the CLASS Act will be effective January 1, 2011 The Secretary of Health and Human Services ( The Secretary ) must develop the details of the plan and implement it by October 1, 2012 Practically people can start enrolling in 2012 or 2013.
8 Eligibility to Enroll All Americans who are actively at work full- or part-time, age 18 and older, and not living at the time in a nursing home (or other institution) will be eligible to enroll People cannot be excluded from enrolling due to pre-existing conditions The Secretary will develop the details of the actively-at-work requirement.
9 Enrollment procedure Employers will sign employees up automatically, with premiums handled through a payroll deduction Those who chooses not to participate may opt out Neither employees nor employers are required to participate in the program Employers may pay all or part of the premiums, but are not required to The Secretary will develop enrollment procedures for those who are self employed or whose employer chooses not to participate in the automatic payroll plan.
10 Benefits in Brief The plan will pay cash benefit, no less (on average) than $50/day The amount will be pegged to an assessment of a person s need for help due to a physical or cognitive limitation A benefit payment scale, to be developed by the Secretary, will result in higher amounts for people with greater need for help with basic activities of living The cash amount will increase annually with inflation There is no lifetime limit.
11 Qualifying Level of Disability The law requires the Secretary to choose between a loss of the ability to perform 2 or 3 ADLs to serve as the minimum level of disability to qualify for benefits The level of disability would need to be expected to continue for at least 90 days to qualify The Secretary will also design the details the assessment process.
12 Other Requirements A participant will need to pay premiums for five years and be actively at work for three of these before being eligible to receive benefits A person is still considered a CLASS plan participant so long as they continue to pay premiums after the three years actively-at-work requirement is met.
13 CLASS Premiums The Secretary will develop a financially sound program with the best mix of benefits, premiums, and other features to meet customers needs and assure program solvency, in consultation with an Advisory Council that has consumer representatives and technical experts due to be finalized no later than October 1, 2012.
14 Known Premiums Features Premiums may be lower for younger people than for older people when they sign up Are intended to remain the same for a person from the time the person signs up People with health issues or a disability may not be charged higher premiums Working students and people with low income will be charged a special low premium price (e.g. $5/month) Special rules regarding premium prices will apply to people who enroll, drop out, and reenroll later.
15 Key Success Factors Participation rate: Higher participation lower premiums, higher cash benefits and financial solvency Significant role for employers to offer the plan to employees and educate them about its benefits This includes Healthcare Unbound: Technology manufacturers/ developers Service providers Payers and health plans, as well as the federal government.
16 Advantages of CLASS Will educate consumers about LTC insurance and the existing myths about Medicare May expand private LTC insurance market Opportunity for supplemental/ wraparound insurance plans Will significantly expand the limited Medicare, Medicaid and Private Pay Market for Healthcare Unbound Technologies and Services.
17 The Devil is in the Details.. But We have an opportunity to contribute to shaping the program to make it succeed It is incumbent upon the Healthcare Unbound community, us, to take measures as employers to attain levels of participation sufficient to stimulate the adoption of our products and services
18 Conclusion Healthcare reform is transitioning the healthcare system from P4S to more emphasis on value add (including the value of information) CLASS will turn the market from payer driven to consumer driven Healthcare Unbound community needs to prepare for the shift in the market, and can contribute to making it succeed.
19 Thank you Majd Alwan, Ph.D., VP CAST American Association of Homes and Services for the Aging (AAHSA) (202) More Information about Technology Provisions in the Healthcare Reform Bill and CLASS Act:
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