A Comparative Analysis Of Chronic And Nonchronic Insured Commercial Member Cost Trends

Disease management (DM) is increasingly encountered in health plans and employer groups as a health care intervention targeted to individuals with chronic diseases (“Chronics”). To justify the investment by payers in DM, it is important to demonstrate beneficial clinical and financial outcomes. In the absence of randomized control studies, financial results are often estimated in a pre/post-study in which the cost of Chronics in the absence of DM can be predicted by their pre-DM year cost (on a per member per month basis) adjusted for the Nonchronic population’s cost trend. The assumption made, not previously tested, is that absent DM, the Chronic and Nonchronic trends are identical.

We calculated Chronic and Nonchronic trends between 1999 and 2002 and compared them under different assumptions regarding identification of chronic disease and medical services. Qualification for the Chronic group was defined as having coronary artery disease, heart failure, diabetes, asthma, or chronic obstructive lung disease. Our base case used an algorithm that identified a member as Chronic prospectively (that is, from the point of identification forward), with one or more of the chronic conditions. We used a data set of 1.5 million commercially insured members.