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How Cigna aims to limit healthcare spending increases to mirror the consumer price index

News | Healthcare Business Trends

How Cigna aims to limit healthcare spending increases to mirror the consumer price index

  • One of the nation’s largest health plans is undertaking numerous measures to cut spending increases to match the consumer price index. 
  • Cigna still has work to do since its 2020 spending increase is projected to be between 3.5% and 4.5%.
  • Key steps including squeezing out low-value healthcare services.

Cigna officials say they are on track to reduce increases in total spending on healthcare delivery to the increase in the consumer price index (CPI).

Cigna continues to aim to reduce spending increases to CPI by the end of 2021, although they are not there yet, executives said recently.

For instance, on an investor call this week David Cordani, president and CEO of Cigna, described the goal as being "indicative of a sustainable trend that the system and society could tally and manage on a go-forward basis and indicative of a responsible trend."

However, the health plan has some distance to travel on cost control, as it projects its spending will increase by between 3.5% and 4.5% in 2020, or far more than the 2.3% increase in CPI that occurred in 2019.

However, Cigna's 2020 projection is still an improvement over that of commercial health plans generally, with the Centers for Medicare & Medicaid Services projecting an average spending increase of 5.1% annually from 2020 to 2027.

How does Cigna plan to reach CPI?

Despite the larger overall increase in spending, Cordani noted that the health plan already has reduced spending increases to CPI for "many" clients.

A key to expanding such savings to all enrollees will be to "wring low-value care out of the system," John Keats, MD, national medical director for affordability and specialty partnerships with Cigna, said at a recent briefing for congressional staff.

The low-value care that the health plan will target includes:

  • Diagnostic services and imaging for low-risk patients prior to surgery
  • Population-based vitamin D screening
  • Prostate-specific antigen screening in older men
  • Acute imaging for lower back pain in the first six weeks in patients without neurological symptoms
  • Use of branded drugs instead of generics for specific drugs or drug classes

Specific steps to bring down spending

To reduce pre-op scans, the health plan is disseminating a "healthcare value checkup tool" to inform providers when patients fall into a low-risk category, Keats said.

However, Cigna has learned it is critical to include health systems in that effort.

There’s "a lot of finger pointing when you talk to providers like, 'Why do you order a chest x-ray and EKG on a perfectly healthy senior who’s having cataract surgery?'" Keats said. "Often the answer is, 'The hospital makes me.' OK, so how do you get the hospital to stop making you do that?"

Another step is to include such imaging costs in provider costs that the health plan calculates as part of its "Cigna Care" provider designation program.

The health plan also has reached out to health systems to stem Vitamin D screening that the U.S. Preventive Services Task Force (USPSTF) has rated as lower-value care.

"The problem with that, as many people discovered, these are embedded in panels of laboratory tests," Keats said.

The health plan credited extracting those tests from panels with helping to cut their use by 32% in two years, saving $24 million.

On prostate-specific antigen testing, Cigna has avoided setting a specific age cutoff in favor of urging that physicians limit its use among asymptomatic patients older than 50 to those with at least a 10-year life expectancy.

"That’s how we try to advise our contracted physicians to look at that issue," Keats said.

To cut the use of imaging for lower back pain within six weeks of onset among patients without neurological symptoms — another service with a low rating from the USPSTF — the health plan has placed such tests under its prior-authorization programs.

Another approach to stamping out the practice is through direct discussions with the health plan’s commercial accountable care organizations (ACOs) and its wholly owned outpatient delivery system.

"This is one that has really taken hold pretty well," Keats said.

Cigna also has had success in getting its ACOs to move from name-brand drugs to generics. A key to increasing generic-drug use going forward among the providers it pays, Keats said, will be a precertification program provided through a partnership with a healthcare solutions company.

The health plan also will offer a business partner’s health waste calculator to its ACOs as a tool for identifying low-value care.

Another tool is used to reduce unnecessary care, improve patient outcomes and lower costs by providing clinicians with appropriateness measures.

 

About the Author

Rich Daly, HFMA senior writer and editor,

is based in the Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

 

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