Carve-ins: a trend in managed care?

Pharmaceutical Representative

Carve-ins, hybrid models for disease management, are evolving out of integrated delivery systems and carve-out companies, according to a new report from Decision Resources.

In "The Rise of Carve-in DM Models: Opportunities for Pharmaceutical Companies," authors Vince Kuraitis and Tom Young of Better Health Technologies argue that the carve-in model is increasing in popularity because it combines the benefits of integration with specialization.

Kuraitis and Young define a carve-in as a partnership between a specialty disease management company and a payer that choose to collaborate with local providers, such as a group of physicians or an integrated delivery system. "The carve-in model combines the carve-out view of the delivery system as a combination of discrete disease states with the IDS view of the delivery system as a continuum of care," the authors wrote.

Although the carve-in model for disease management does not have the benefit of transferring risk to an outside company, as the carve-out model does, Kuraitis and Young opine that industry conditions that favored carve-outs are now being replaced with conditions that favor carve-ins.

Carve-ins allow patients to see their regular physician for specialty treatment, for example. Studies have shown that patients already want more choice and flexibility when it comes to health care, and as they lobby for more say over health care policy and payment, their satisfaction will become increasingly important.

"Health plans will be wary of the perception that they restrict patients to a narrow, carved-out provider panel," the authors wrote. "Thus, they will be more likely to carve-in, or integrate, an existing physician panel than to carve out a more restrictive physician panel."

Furthermore, health care plans will become more focused on controlling the costs of the small number of plan members who have multisymptom, chronic conditions, they stated. According to the July 1997 issue of American Journal of Managed Care, 1% of high-risk patients consume 30% of a typical health care plan's costs. Of this 1%, 60% did not fall into one chronic condition. This makes carving out, or specializing, disease management programs for such patients, problematic. Determining which company is accountable for treating a patient's symptoms creates even more of a quandary. For these high-risk, high-cost patients, the authors argue, the carve-in model is the more attractive option. In the carve-in model, accountability is more clearly defined.

Physicians will also like carve-ins better than carve-outs, according to the report, because they will not be required to surrender care of their patients to someone else. "Physicians are much more likely to actively participate in carve-in programs because these programs allow them to retain control over relationships with their patients," the authors wrote.

Weighing the cost

Whether or not disease and pharmacy management companies are going in the direction of carve-ins, however, is a matter of opinion.

Arthur Shinn, Pharm.D., principal at William M. Mercer in the managed pharmacy practice group, thinks carve-ins may not be much of a bargain.

"With carve-ins, they are taking back what they have previously carved out and are doing it in-house. They are implementing and managing their own program; they are not contracting it externally; it's part of their function resources," Shinn said. "Most of the time, people don't have the resources or the fiscal means to manage [a program] themselves."

Shinn compares making the decision to carve out a disease management or pharmacy program to making the decision to have someone else change the oil in your car. "You can change your own oil, but why not pay someone who specializes in that do it?" he asked. "In my opinion, carving out a specific, sophisticated task [is better] because the person [who does it] is a specialist. And there may be fiscal leverages to do a better job."

However, Kuraitis and Young cite Diabetes Treatment Centers of America as an organization that has developed a carve-in model for disease management. The program includes local diabetes educators, nurse case managers and dieticians who interact with patients and physicians. The authors wrote: "As evidence of its success, in spring 1998, DTCA acquired the single largest contract ever for disease management when it signed an agreement with Highmark Blue Cross Blue Shield in Pennsylvania. Under this agreement, DTCA will provide care to approximately 40,000 of Highmark's diabetic members."

Whether carve-ins will be the next trend in disease and pharmacy management remains to be seen. PR