Cutting costs, increasing quality

The high cost of health care has been at the forefront of the minds of governments across the globe as they come to grips with rising healthcare costs, aging populations and massive increases in the prevalence of chronic diseases. In a bid to get to grips with the issue the Cayman Islands government launched the first ever Healthcare 20/20 conference last year. As a follow on from that conference the first ever Healthcare Thought Leaders Forum took place at the beginning of this year, to try and delve further into ways of cutting costs and increasing the quality of health care for the Cayman Islands. 

Having worked with the Cayman Islands National Insurance Co. for the past five years, the organiser of the Healthcare Thought Leaders Forum, Ken Di Bella, says he cares about the health care of the Islands. 

Di Bella is the CEO and president of health care management firm CBCA Administrators/Simplifi and he and his colleagues Dr Edward Cabrera, chief medical officer of KePRO and Kelly Burn, Executive Healthcare Consultant brought an interesting perspective to a group of Cayman’s top health care professionals with regard to how Cayman might improve its healthcare services while at the same time cut costs and increase revenue to the Island.

At the Forum, Health Minister Mark Scotland set out the enormity of the problem for the Cayman Islands: “Here in Cayman, during our last financial year $93.4 million was spent on health care costs, which represents 17.5 percent of our national budget. Of this amount of $93.4 million, 22 per cent was spent on overseas referrals for a segment of the population of 2500 persons, representing our seafarers and indigent population. 

“These costs are driven rapidly upwards by increasing public demand, rising insurance costs, specialist technology, expensive research and development cycles that increasingly seek quick turn-around. Additionally, other factors driving higher overseas costs are new costlier procedures, medical inflation in the United States, new and costly pharmaceutical drugs, physician practice patterns leading to more tests and prescribing more drugs and an aging population.”

Healthcare 20/20, Scotland said, was all about looking for the best experience in health care and fresh thinking about policy. Di Bella furthered this by saying that the conference revealed a burning desire to effect change. 

“The Cayman Islands needs a partner to make those changes,” he said 

Thus, the Forum would explore ways in which Cayman could quickly improve the quality of health care for the general population of Cayman while at the same time reverse the flow of money out of Cayman and into places such as the US and Canada. Di Bella said that an added benefit of his suggestions would improve the general economic condition locally by getting Caymanians involved in the business to a greater degree.

Di Bella said the presentations would focus on two significant opportunities for Cayman – the development of an ambitious wellness and chronic illness management plan to drastically cut the cost of health care and the development of Cayman owning an exclusive provider network, rather than rent the network and pay a middleman to do the work, again to cut costs for the government.

Chronic illness management

Dr. Edward Cabrera said that the prevalence of chronic illness was now a major cause of death and disability worldwide, with Australia leading the rate of premature deaths due to chronic illness, at 80 per cent and chronic diseases in Spain accounting for 70 per cent of that country’s health care spend. Global deaths from chronic diseases are set to increase by 17 per cent from 2005 to 2015.

Cayman was not immune to the problem. 

Minister Scotland confirmed: “An added economic burden is the high prevalence of chronic diseases such as hypertension, heart disease and stroke, cancer, chronic respiratory diseases and diabetes. These preventable diseases are the leading causes of premature death in our region.” 

To highlight just how much of a burden such illnesses were to Cayman, Cabrera outlined an example whereby a group healthcare plan for 13,400 Caymanian members would generate approximately $76.2 million in health claims annually or $5,687 per member. 

“$19.8 million (26 per cent) can be attributed to the treatment of chronic illness (excluding cancer) or $1,478 per member,” he said.

According to the doctor, here was more than meets the eye when it came to the spiralling costs associated with chronic disease. Obvious costs include medical care, hospitalisation, pharmacy and medical costs, while less obvious costs include absenteeism, turnover, product quality, training, admin and long and short term disability costs.

Getting to the point at which chronic diseases manifest themselves was key to improving health care and reducing costs and the doctor outlined the major chronic diseases, such as heart disease, stroke, diabetes, renal failure, hypertension, obesity, which were all preventable.

Cabrera went on to say that there are only a few disease risk factors which create the majority of the financial burden: smoking, high alcohol consumption, high cholesterol, dietary factors (consuming too much carbohydrates and bad fats and sugars and too low good fats) and lack of physical activity. 

He also said that chronic illness can lead to other conditions, For example with diabetes, the risk of stroke is two to four times higher, stroke was noted on 16 per cent of diabetes-related death certificates for people aged 65 and older and it is the leading cause of kidney failure, with 44 per cent new cases in 2005.

“Changing behaviour can have a major positive impact in reducing risk factors, often within a short space of time,” Cabrera explained. “Engaging the patient in their own health care is the challenge.”

He went on to say that wellness programmes have proven to be effective tools in increasing health care quality and decreasing costs with an estimated return on investment of about US$2 to US$8 for every US$1 spent. The challenge, he said, was that behaviour changes are not always at the front of one’s mind and that it was not reinforced constantly.

CuttingSM

Ed Cabrera, Kelly Burn and Ken di Bella

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