The Article That Revolutionized U.S. Managed Care

A Case Study in Latin American Healthcare – Managed health care takes its place among the products of a global market

Reprinted with permission from Managed Healthcare, October 1995

Managed care has precipitated a series of innovative strategies, systems, and products into the health care market. Among these developments, the concept of demand management has emerged as a fundamental care-management strategy designed to ensure the right care, at the right time, and with the proper resources.

In keeping with this trend, hospitals, health plans, and integrated delivery systems are installing medically oriented call centers, which direct patients to the appropriate level of care before they self-select potentially expensive and/or unnecessary levels of care, such as urgent care or emergency care. This tangible example of demand management represents one of the fastest growing strategies to succeed in the managed care arena.

What Is A Medical Call Center?

Recent studies of consumer behavior reinforce the need for demand management programs in general, and medical call centers in particular. In 1993, the Government Accounting Office found that as many as 43% of emergency-room visits were unnecessary, as there were other appropriate options available to choose from. Two health plans in Florida were denied NCQA accreditation because their members had no option for health advice in the evening other than the emergency room. It was determined that the members who truly needed care couldn’t get through the congestion quickly enough.

In addition, Kaiser Permanente found that 40% of physician-office visits were probably unnecessary, as individuals who were the “worried well” exercised their option to report to the ER or to the office of their primary care physician.

What actually happens during those visits is of additional concern, as demonstrated in a recent student conducted by Consumer Reports. That study found that 30% of physicians don’t advise their patients on the need for medication therapy, the possible side effects of medication, how often to take medications, or how to initiate lifestyle changes to lead healthier lives (75% of the physicians agreed with the findings). So if physicians do not properly counsel their patients, who will?

The interest in medical call centers is also being fueled by the rapid penetration of capitated health plans and related efforts to push financial risk to the lowest level of health care delivery. As health care organizations and health plans re-engineer to prepare for capitatation, they need the fundamental operating systems to properly “manage the care” and to ensure that risks accepted do not threaten the financial viability of the plan.

Just as important, medical-liability risks become more significant, since the practice of demand management might be interpreted in some situations as involving the denial of care that was perceived by the patient/subscriber as being necessary under the circumstances. Call centers that use thoroughly researched and consistently applied guidelines will find that they can effectively manage both the financial and medical risks associated with the capitated contracts.

In addition to managing these risks, medical call centers have been effective in advancing health-education efforts, and in improving member satisfaction. Studies demonstrate that these programs are often interpreted by the caller as “member advocate” programs. Therefore, members remain affiliated and are less likely to disenroll from the plan during open enrollment. Members become empowered to take better care of themselves and to lead healthier lives. In general, individuals who are in good health already will see the program as being “value added” thus ensuring their continued patronage as well.

With these significant benefits in mind, it would not be surprising to find the Joint Commission on Accreditation of Healthcare Organizations and the National Committee on Quality Assurance establishing certain standards associated with the management of medical call centers at some point in the future.

How a Medical Call Center Works

Medical call centers represent an important demonstration of demand management. If properly configured, they can positively affect a broad range of subscribers and the health care decisions they make.

Members are typically instructed to call the medical call center after their local provider’s office has closed. These “after hours” programs are designed to advise members in potentially urgent situations, and to ensure that emergency care is necessary and appropriate. In addition to precertification for emergency care, more comprehensive 24-hour programs may serve in a gatekeeper role for provider offices, and provide scheduling services, primary care-physician assignment, second opinion referrals, and medication-compliance counseling.

It is reasonable to expect that the call center might also become the principal vehicle to support disease state management, where the combination of counseling, medication therapy, and routine telephone contact is employed in a coordinated fashion to efficiently manage various disease states, including asthma, diabetes, and high blood pressure.

Putting It All Together

Implementing a call center is a complex task, but many industry suppliers are available to assist with on-site consultation, training, and ongoing support services. The end-user of the technology will be a combination of nurses and clerical professionals who trade off to manage a broad range of inquiries typically managed by these centers.

A combination of software, hardware, and information databases come together to automate the center, and to enable it to support the rapid growth of the provider and plan. In addition, interactive voice response (IVR) technology typically is employed to offset labor costs and improve the center’s responsiveness, as many routine calls can be handled through an audiotext message.

The combination of “high tech” as evidenced by an IVR unit, and the “high touch,” through direct dialog with a registered nurse, is effective in addressing a broad range of needs and preferences that patients have for accessing health advice and information.

A Medical Call Center

Examples of model call centers exist in almost every vertical market within health care, fueling even greater interest in this area as providers and plans implement them — if only to remain competitive in the marketplace. Seven years ago, the Division of General Pediatrics of the University of Colorado School of Medicine, in partnership with The Children’s Hospital of Denver, developed “The After Hours” program for area pediatricians that today serves as a testament to the effectiveness of demand management.

Virtually every physician in Denver and most physicians in the state of Colorado subscribe to the service. After analyzing 400,000 calls that have been managed through the program, it was found that up to 60% of patients are counseled after hours with no more than a series of self-care instructions, and another 25% are instructed to consult their physician the following day instead of visiting an emergency department — which was the original intent of many callers before contacting the program.

This concept is taking hold quickly at health plans around the country. Most large health plans, including CIGNA, United HealthCare, and Health Alliance Plan already offer a health-advice program to their members, and a recent study indicates that more than 25% of the HMOs in the United States plan to offer a program within the next year.

Tracking Outcomes With Call Centers

A fundamental application of the call center is to track outcomes. While the healthcare industry continues to debate the application of outcomes measurements, the call center represents an effective vehicle to manage and track them. Management should hold the call center accountable for the outcomes it creates. Sufficient resources and energy should be applied to tracking relevant outcomes, including an assessment of the quality of care rendered, economic efficiency of the encounter, and ultimate member and provider satisfaction.

Following the path of the caller’s ‘original inclination’ is critical to tracking outcomes and verifying the economic efficiency of the call center. Most callers will readily reveal their inclination as they try to get the call center staff to agree they should be seen immediately. Comparing their original inclination to the final disposition will demonstrate the dramatic cost savings to the provider and plan as members begin to receive care and resources consistent with their actual needs.

Some callers will not appreciate being told by the call center that they cannot be seen immediately. These individuals must be provided with care advice to mitigate some of the pain and anxiety they may feel until they can receive an appointment. Outcome studies will allow comparisons between observed symptoms, advice rendered, and resources consumed.

To address the quality of care and advice rendered by the call center, staff should follow up with the ultimate care giver to determine if the referral was appropriate based on the perceived need and the time of day that the encounter actually occurred. For example, if the medical call center refers the caller to an urgent care clinic because his or her personal physician is unavailable, that visit may be appropriate under the circumstances. The outcome of that call will be determined to be consistent with the standard of care required by the provider and health plan.

Finally, satisfaction surveys will confirm that members and their physicians see the value added by medical call centers. In addition to the study conducted by Health Alliance Plan, a survey conducted by The Children’s Hospital confirmed a high degree of satisfaction with respect to the advice provided through a medical call center (100% satisfaction among physicians, 98% satisfaction among callers). Furthermore, members inferred that the availability of health advice was an important reason for remaining in a plan.

The Ultimate Benefit

With the many benefits afforded by a medical call center, every hospital, health plan, and integrated delivery system should consider the establishment of a center for their key target markets. Physicians will support medical call centers if it can be demonstrated that they provide sound advice to patients that is consistent with the physicians’ practice philosophies.

Operations managers will quickly recognize the financial benefits, and risk managers will appreciate such center’s contributions to minimizing liability exposure. Furthermore, recognizing that members associate call centers with a high-quality operation confers another important benefit: protection of existing market share and the ability to accommodate further gains in share.

With a range of benefits as broad as this, it may not be long before the medical call center does indeed become a standard benefit, offered to all members by all providers that render high quality and cost-effective health care.

by Ian R. Lazarus Reprinted with permission of the author. Mr. Lazarus may be contacted at

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