New TriZetto Cross-Constituent Survey Finds Surprising Agreements and Disagreements About Healthcare IT Solutions

Results of a survey released today by The TriZetto Group Inc. (NASDAQ: TZIX) show that patients, doctors and other healthcare constituents agree that more shared information and aligned incentive programs are key to helping solve the healthcare affordability crisis and that health plans are best positioned to coordinate these improvements. The findings of TriZetto’s 2008 Integrated Healthcare Management (IHM) Survey highlight a disaggregated healthcare system in which employers, doctors and consumers too often don’t have or don’t use the information they need to optimize and coordinate individual health and treatment decisions, consumer and provider incentives are misaligned, and in some cases constituents lack agreement about the kind of technology and tools needed to improve healthcare delivery. "To borrow a line from the movie Cool Hand Luke, what we have here is a failure to communicate,” said Dan Spirek, executive vice president, integrated health solutions, and chief solutions officer at TriZetto. "Consumers, providers, employers, brokers and payer organizations are disconnected from one another and therefore have difficulty coordinating healthcare decisions to drive better outcomes. The good news is that the requisite data on health status, medical procedures and much more resides largely in the administrative and care management systems of health plans, so these organizations are ideally positioned to share this information with all healthcare constituents, improve the alignment of incentives and thereby optimize the coordination of health benefits and care for the consumer. We call this systemic approach Integrated Healthcare Management,” Spirek said, "and we believe IHM can help fix what ails the U.S. healthcare system.” Commissioned by TriZetto and conducted by TNS Custom Research, a global market information firm based in London, the IHM Survey is a cross-constituent study – of senior-level health plan employees, employers, brokers, general practitioners and specialists, and consumers – and will be conducted annually, according to TriZetto. For the inaugural study in late 2007, more than 1,700 individuals were queried online regarding healthcare costs, cost management, incentive programs and the availability of information and tools to make healthcare decisions. AFFORDABILITY IS A CRITICAL CHALLENGE High costs in the U.S. healthcare system impact all constituents as well as the system itself. Survey results show that consumers, in particular, have been touched by the challenge of healthcare costs. Eighty-one percent of consumers surveyed by the TriZetto IHM study expressed concern about their future healthcare costs, and only 8 percent voiced a lack of concern. Similarly, 73 percent said they were concerned about their current healthcare expenses, while 62 percent expressed worry that their current health insurance plans would not adequately control these costs. While the industry as a whole seeks better cost management, "the first step in improving cost management must be higher levels of basic awareness,” according to the report, and awareness requires shared information. CONSTITUENTS HAVE HIGH INTEREST IN SHARED INFORMATION Eighty-eight to 91 percent of all constituents saw some value in a range of online information tools that help anticipate healthcare costs, select benefit packages and receive customer service. Examples of such tools are estimators that consumers can use to determine how much they will pay for treatments or online comparisons of physician and hospital costs and quality. Three in four constituents (78 percent) said they would like employers to offer online reward programs that encourage healthy choices about diet, exercise and tobacco use. Doctors, too, believed that additional online information would benefit the healthcare system. Roughly 60 percent of providers said that posting quality ratings would have a positive effect on patient satisfaction and on their practices, and between 80 and 90 percent rated as very or extremely important that they have access to patients’ health information prior to appointments and access to patient records of treatments and medications across all physicians and hospitals. Four out of five providers, according to TriZetto’s IHM Survey, believed pay-for-performance programs, a healthcare industry trend, would be bolstered if payers "proactively shared patient information to facilitate stronger care-giver interaction and better care.” Significantly, two-thirds of providers surveyed rated as very or extremely important the integration of health insurance company information systems with those of physicians and hospitals. CONSUMER, EMPLOYER AND PROVIDER INCENTIVES REQUIRE ALIGNMENT More than 90 percent of both employers and payers in the TriZetto IHM study considered wellness incentives at least somewhat effective as a way to lower the healthcare costs of employees and their families. And consumers appeared up for the challenge: Between 50 and 60 percent said they would be interested in using a range of incentives, if they were available, to take health risk assessments and participate in wellness programs such as exercise. Further, there was agreement among consumers, employers and payers in the TriZetto study that participation in workplace health and productivity management programs could be encouraged most by cash incentives, co-pay or premium reductions, and lower co-insurance levels. However, in an example of where incentive alignment could be improved, consumers found few opportunities to sign up for wellness programs, with only 6 to 18 percent reporting participation in a range of such incented programs. Further, according to TriZetto’s IHM Survey, most employers – 60 percent – reported that they had no information systems with which to mange incentive-based programs. And only 28 percent of employer, broker and payer respondents said they were very or extremely likely to build incentives into health benefit plan contracts, with 44 percent unlikely to include such contractual commitments in the near term. Among providers, some 60 percent of general practitioners and specialists surveyed by TriZetto thought that incentives to coordinate care across facilities would improve outcomes and reduce costs. Half believed that pay-for-performance programs could be an effective way to reduce cost and improve quality. But, in another example of an opportunity for better incentive alignment, only about a fourth of surveyed providers reported participation in payer-sponsored pay-for-performance programs. PAYERS ARE BEST POSITIONED TO LEAD THE WAY, BUT MUST CHANGE ROLE When asked who might best lead the coordination of health benefits and care for the healthcare consumer, payers were most frequently named by all constituent groups. Health plans were preferred by 26 percent of respondents overall, according to TriZetto’s IHM Survey, versus 18 percent for consumers, 17 percent for government and 14 percent for physicians and hospitals. "However, to lead the coordination of health benefits and care, payers must evolve from their historically transactional orientation to a broader role as health and wellness advisor,” according to Spirek. "Laudable are the initial efforts of national players, which are driving awareness. But regional players may be best positioned to deliver real results that enhance information exchange and close information gaps between healthcare constituents.” INFORMATION AND AWARENESS GAPS ACROSS CONSTITUENCIES Exemplifying these information gaps was the finding by the TriZetto IHM Survey that consumers were unaware of how much employers paid toward their insurance premiums. Only one in 10 consumers knew that the employer share was greater than $1,000 per year per individual and more than $5,000 per year per family. Four in 10 consumers had no idea what employers paid, and in fact, five in 10 believed employers paid considerably less than what they paid toward employee premiums. In 2007, employers’ monthly premium payments were more than $3,600 per individual and $7,400 to $9,400 per family.(a) Regarding their own outlays, nearly two-thirds of consumers admitted in the TriZetto IHM study that, at best, they were only somewhat aware of their healthcare expenditures. Yet, in contrast, most consumers expressed concern about their future healthcare costs. While cost awareness was an issue for individuals, cost management revealed an information gap among providers. Nearly half of the surveyed providers reported increases in accounts receivable and bad debt. However, only some providers were actively assessing patient liability, with 68 percent saying that they infrequently or never estimated the amounts patients owed prior to providing care. But the TriZetto survey also showed that the number of providers who estimate patient liability would grow by 70 percent if online tools were available for them to do so. Other online tools can help consumers track their medical expenses, get estimates for procedures, compare provider costs and quality, and manage personal health information. Eighty-seven to 92 percent of surveyed consumers claimed that they had an interest in using a range of such tools. But there was evidence of an information gap because 43 percent of consumers simply did not know if online tools were available to them. LACK OF AGREEMENT CONCERNING THE INFORMATION CONSTITUENTS SEEK To some degree, payers and providers were not in agreement about the information that would be required to improve the coordination of benefits and care for consumers. For example, the TriZetto IHM Survey revealed that providers would like to have access to patient records across all providers. However, only a minority of payers (29 percent), according to the survey, reported that providers requested this kind of access. And while two-thirds (67 percent) of providers said that integration of insurance with provider and hospital management systems would be important, only a third (33 percent) of payers acknowledged that providers sought this integration. The TriZetto IHM Survey revealed a similar disconnect between employers, brokers and payers. While more than half of surveyed employers and almost 75 percent of brokers favored information tools that would help determine the plan options that best fit an employee’s benefit management goals, only about 40 percent of payers perceived this need. Sixty-five percent of brokers and 48 percent of employers favored applications that would ease the management of employee incentives, but only 42 percent of payers acknowledged this sentiment. "Again, payers have all the benefit plan, cost and treatment information on Americans with health insurance,” Spirek said. "Payers can close these information gaps, bridge these disconnects and drive IHM by leveraging the wealth of health benefits and care information in their systems to engage constituents and align incentives, helping to solve the affordability crisis.” A full report on the findings of TriZetto’s 2008 IHM Survey is available on the home page of www.trizetto.com or from the contacts listed below. About TriZetto TriZetto is Powering Integrated Healthcare Management™. With its technology touching nearly half of the U.S. insured population, TriZetto is uniquely positioned to drive the convergence of health benefit administration, care management and constituent engagement. The company provides premier information technology solutions that enable payers and other constituents in the healthcare supply chain to improve the coordination of benefits and care for healthcare consumers. Healthcare payers include national and regional health insurance plans, and benefits administrators that provide transaction services to self-insured employer groups. The company’s payer-focused information technology offerings include enterprise and component software, hosting and business process outsourcing services, and consulting. Headquartered in Newport Beach, Calif., TriZetto can be reached at 949-719-2200 or at www.trizetto.com. (a) Kaiser Family Foundation and Health Research and Educational Trust, "Employer Health Benefits, 2007 Annual Report”