Unseen Costs of Chronic Care Management & the Leapfrog of Third Party Reimbursement

FEB 28

Back in 2007, a study from the Milken Institute stated that U.S. caregivers were treating over 109 million Americans and their 162 million cases of chronic disease (including one or more combinations of the seven most common – cancer, diabetes, heart disease, hypertension, stroke, mental disorders, and pulmonary conditions).

More recently, data offered by the likes of the National Family Caregivers Association and Gallup underscore that care-giving in and of itself takes just as meaningful a toll on the population of 50 million care-givers (professionals, family members and friends) who look after the chronically ill.

The Gallup-Healthways Well-Being Index cites that full time care-givers are substantially more likely to experience physical health issues than those who aren’t.   For instance, they have a 63% greater likelihood for high blood pressure and 61% greater likelihood of recurring neck or back pain. Often times, care-givers are unpaid volunteers (friends and family members) and may face the unfortunate scenario of balancing caring for someone else and themselves.

A few innovative firms are offering products and services that are helping these care-givers provide care while simultaneously reducing their own stress levels.  Most interesting is that the latest approaches to self-care aren’t likely to ever be reimbursable by a third party (i.e. health plans), despite offering real health benefits.  Traditionally, a healthcare product or service without a corresponding reimbursement code was a non-starter as a growth strategy for new products and services in healthcare…but those days are dwindling.  In fact, there are a growing number of relevant healthcare companies who are taking the initiative of going direct to the consumer regardless of reimbursement.

  • BodyMedia collects information on activity, calorie burn, and sleep patterns through an armband monitor and either connected of via Bluetooth, syncs with a web based tracking system.  Obesity is a massive problem, and often has correlating co-morbid conditions.  BodyMedia markets its product through retailers like Amazon.com, Best Buy, CVS, Costco, and Target and channel partners like 24 Hour Fitness, dotFIT, and Jenny Craig.
 
  • Cellnovo is a UK- based diabetes management technology with a solution that ties together a cell phone, insulin pump and computer to monitor and control blood glucose levels in diabetics.  This product’s ability to remotely update care-givers through texting or other mobile communications alleviates the stress put on a care-giver when they are not in direct contact of their loved one.  Cellnovo intends to sell to the consumer market in the UK in early 2011 with US market entry in late 2011.
 
  • Healthsense provides integrated systems to monitor aging independent living population through remote monitoring systems which include bed, toilet, motion, and contact sensors.  As caregivers go about their daily jobs and other tasks, this technology eases concerns of potential risks of independent senior citizens.  Healthsense relies on direct sales to consumers including seniors and their caregivers.
 

Relative to costs associated with chronic illness, the 80/20 rule applies – 80% of the costs come from 20% of the population.  Vendors can’t and shouldn’t wait for reimbursement models to justify their go to market strategies and today, we’re watching literally scores of of vendors like those listed above blaze new channels straight to the consumer.

We’d like to know what you think.

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Joanna Roth
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