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Squaring

Squaring. the Circle. HEALTHCARE COSTS & QUALITY “A Managed Care Perspective” PRESENTED BY: Charles Harebottle Managing Director, MSO. The BHF Southern African Conference 22-25 July’07 Sun City. Squaring. Hospital Cost Inflation. the Circle.

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Squaring

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  1. Squaring the Circle HEALTHCARE COSTS & QUALITY“A Managed Care Perspective”PRESENTED BY:Charles HarebottleManaging Director, MSO The BHF Southern African Conference 22-25 July’07 Sun City

  2. Squaring Hospital Cost Inflation the Circle The BHF Southern African Conference 22-25 July’07 Sun City

  3. Squaring MERC E-CLASS 1973 the Circle The BHF Southern African Conference 22-25 July’07 Sun City

  4. Squaring MERC E-CLASS 2006 the Circle The BHF Southern African Conference 22-25 July’07 Sun City

  5. Squaring TATA INDICA the Circle The BHF Southern African Conference 22-25 July’07 Sun City

  6. Squaring Managed Care Costs the Circle • 2002 - “Managed care costs went up to R986 from R885” • 2003 – “Managed care costs went down to R966 from R986” • 2004 – “Managed care rose by 14,2%” • 2005 – “Managed care expenses rose by 12,6%” • 2006 – “Managed care fees increased by 2%” The BHF Southern African Conference 22-25 July’07 Sun City

  7. Squaring Actual Managed Care Inflation at a Per Beneficiary Level the Circle The BHF Southern African Conference 22-25 July’07 Sun City

  8. Squaring Actual Managed Care Inflation at a Per Beneficiary Level the Circle The BHF Southern African Conference 22-25 July’07 Sun City

  9. Squaring HBM Service Inflation the Circle 2000 to 2005 -12% in absolute terms The BHF Southern African Conference 22-25 July’07 Sun City

  10. Squaring Workload Increase the Circle • 27% increase in number of medical protocols to deal with new technology or changed practice. • SEP = 4 fold increase in hospital claims audit. • ICD10 = 25% increase in talk-time. • Introduction of additional cost control measures increased in pre-authorisation contacts per event 3,1 to 5,5. The BHF Southern African Conference 22-25 July’07 Sun City

  11. Squaring What of Quality the Circle • Patient care • Risk management results • Client service The BHF Southern African Conference 22-25 July’07 Sun City

  12. Squaring Hospital Inflation 2005-06 the Circle • Industry = +12% • MSO Universe = 3% • BUT • Individual scheme experience from 23% to 1%. • The Cost Drivers: • Utilisation = -11% • Cost per Incident = +15% • BUT • Highest Inflation Scheme: • Utilisation = +12% • Cost per Incident = +9% The BHF Southern African Conference 22-25 July’07 Sun City

  13. Squaring Hospital Inflation 1st Qtr 2006 - 2007 the Circle • Industry = 15%+ • MSO Universe = 9% • Highest Scheme = 26% • Lowest Scheme = 1% • THE COST DRIVERS • Utilisation = 3% • Cost per Incident = 6% The BHF Southern African Conference 22-25 July’07 Sun City

  14. Squaring In Summary the Circle • Quality foundation IP • Clear, auditable record of action • Clear understanding of scheme and challenges • Consistent innovation in response planning • Quantifiable results The BHF Southern African Conference 22-25 July’07 Sun City

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