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Focus on Managing Caring

The following is an excerpt from an article which appeared in the December, 1997 edition of LTC News and Comment:

Focus on Managing Caring

By Samuel X. Kaplan, Chairman, U.S. Care, Inc.

Chronic care is the largest and fastest growing sector of the healthcare industry. In 1990 chronic care consumed $425 billion, or 61% of total healthcare expenditures in the US. In 1993 LTC costs alone reached $108 billion; by 2000 this figure will rise to $225 billion. Because chronic care is primarily a private-pay issue, LTC represents the largest unfunded liability facing Americans today. 

A recent survey by John Hancock and the National Council on the Aging revealed that nearly 90% of Americans believe LTC is a problem; 59% of respondents said that they were already personally dealing with LTC issues for a relative or friend. The recent passage of HR 3103 providing tax incentives for privately-funded LTC insurance is only a partial answer to the LTC question. 

Managed care absent from LTC insurance

As baby boomers enter their 50s and 60s, the demand for group-sponsored solutions to LTC is increasing. Employers are facing the financial risks associated with providing LTC. As most insurance products fail to effectively manage benefits, employers are turning to a time-tested remedy for rising healthcare costs: managed care. 

Although we can't do much about the continually growing aging population, we can do something about the flow of dollars into LTC programs that don't work. Designed to reduce short-term costs for acute care, traditional managed care does not resolve ongoing chronic-care issues. The solution lies in shifting our focus to managing caring. 

Managing Caring

Managing caring integrates the best principles of managed care with proven quality assurance and cost-effective solutions for LTC. Through managing caring, employer groups can provide employees and retirees with a cohesive continuum of services from acute to chronic care. Managing caring focuses on providing the most appropriate LTC at the most cost-efficient level, including a network of facilities from nursing homes, to home healthcare, to hospice. In addition to facilities, managing caring coordinates and integrates acute care, home care, and LTC to enable a person to remain independent as long as possible. Managing caring also involves the patient's family in decision-making and care-giving processes. 

Teaching self-care is integral to the philosophy of managing caring. Managing caring focuses on positives outcomes, including clinical outcomes, operational measures, financial performance, and risk management indicators. 

The outcomes of individual facilities should be compared to similar providers across a large national data pool to enable the development of benchmarks for care. Patient/family satisfaction surveys are also important measures of success. 

The final component of managing caring is management of medications. Outpatient non-compliance with prescribed drugs is the leading cause of illness and injury among older Americans. Annually, 61,000 seniors suffer drug-induced tremors; 32,000 suffer hip fractures from drug-related falls; 163,000 suffer drug-induced memory loss, and 659,000 are hospitalized due to drug reactions. Many of these problems can be avoided through monitoring and managing medication. 

Employers gain from managing caring in LTC

Managing caring enables those requiring chronic care to remain independent at home as long as possible. Employers offering LTC coverage featuring managing caring will experience a reduction in medical hospitalization. Rather than assess acute-care services through traditional health benefit plans, employees and retirees who have LTC coverage will use less costly chronic-care benefits when appropriate. The availability of LTC benefits will also enable a vigorous discharge plan—from acute settings to lower levels of care. 

Capitating providers

Capitation is a focal point for traditional managed-care strategies; it is also key to integrating acute care and chronic care. Developing an LTC provider-based delivery system with provider-held risk is central to the success of any chronic care strategy. Shifting financial risk to the provider network makes the same people accountable for both the quality and the cost of care. This creates incentives for them to find ways to change the care delivery to ensure the best clinical outcomes and greatest efficiencies. 

The ways and means for employers to integrate managed- and acute-care coverage strategies with managing care LTC strategies are at hand. The rewards await those with the vision to set standards today for LTC coverage. 

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