The Drumbeat for Consumer-Driven Health

CDH, CDH, CDH.

How often in the last month have you come across yet another article proclaiming the rise of Consumer Driven Healthcare (CDH)? For me, it's been a bunch:

URAC Awards BlueCross Consumer Education Accreditation

Grades to Transform U.S. Healthcare, Secretary Says

Report: IT Necessary for Consumer-Driven Health Plans

And so on.

Unless one is careful about reading these reports, one might conclude that CDH is either already the new dominant mode of healthcare financing, or that it will be soon. Every once in a while, though, a countervailing view pokes through:

Consumer-Driven Health Care is a False Promise

Hmm, talk about a bucket of cold water.

So, what is happening out there in CDH-Land? A lot, as it turns out, but in the context of a lot of uncertainty. Health plans, payers, providers, and regulators and moving frantically toward IT systems that can gather and analyze health data on an increasingly fine-grained level with growing sophistication. Medical management companies are able to drill down and dissect claims, prescription, and other data with increasing speed and subtlety.

But it's not just about IT -- it's also about consumer education. URAC's new Consumer Education and Support (CES) accreditation program is starting to catch on, establishing national standards that will guide managed care companies on how to talk to consumers in the new CDH environment. Government entities, both as regulators and as purchasers, are wading in to the CDH arena, too.

All this is happening, though, in the face of the very real possibility that, at the end of the day, most people won't want to direct their healthcare treatment and financing decisions. Some early reports suggest that, given the choice, most folks still don't want to sift through the data to make informed decisions about their payers and providers.

About 6 months ago, I sat down to lunch with a long-time friend of mine, who now is the regional CEO for one of the largest health plans in the nation. I've always admired him for the clarity of his vision, and, after we caught up on family news, I started to pick his brain about trends in healthcare, including CDH. His company, like many of its competitors, is taking a two-track approach, pursuing CDH on one track while sticking with more traditional managed care offerings on the other. After explaining why it makes sense, both in terms of market forces and IT strategy, he explained, "Tom, I give this 2-3 years to shake out. By then we'll know whether consumers really want to get involved in these kinds of choices. I don't know how it will play out, but we'll be ready to move either way, once we can figure this out."

He also explained that the IT investment seems to have other dividends, so even if CDH doesn't pan out, much of the IT investment will turn out to be worth it. This is primarily true because medical management gets better with more sophisticated IT systems, and the industry is just starting to see some serious cost savings and health benefits in upgrading medical management.

So, where does that leave us?

Most of our clients who can are taking the approach my friend's company is: act as though CDH is likely to be a part of the future of U.S. healthcare, and leverage the system improvements so that their benefits last even if CDH goes the way of other fads, like 8-track tapes. Hedging bets is a pretty good strategy, it appears, especially if the cost of doing so is pretty small.