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Case study:
How MSD (known as Merck & Co. in the US and Canada) applied data insights to design value-based insurance
For employers looking to improve their employee health plans, applying insights based on robust data is essential
Case study:
How MSD (known as Merck & Co. in the US and Canada) applied data insights to design value-based insurance
For employers looking to improve their employee health plans, applying insights based on robust data is essential
MSD's V-BID [value-based insurance design] Oncology Pilot is pioneering the use of V-BID principles in corporate cancer coverage for employees. And the company could not have done it without using data to better understand its employees’ health risks and its cancer care expenditure.
Four areas have been key to how MSD has used data to develop its V-BID Oncology Pilot.
1. Understand where resources could make the biggest difference
MSD’s pilot process started with building a clear picture of the impact of cancer among employees under the company’s existing healthcare plan. “We knew we needed to understand our cohort better,” says Brian Kehan, MSD’s Wellbeing Director, Benefits.
Kehan and his team wanted a better view of employees’ risk profiles for a range of cancers, and the expenditure associated with those cancers. Analysis revealed that 47% of MSD’s employees were at high risk of cancer (or had already been diagnosed with it). That is above average, says Kehan: “We tend to have a higher age cohort here compared with the Apples and Microsofts of this world, which have a lot of Millennials and young people working for them.”
In parallel, the team closely examined the company’s cancer spend. “Like any other company, we spend an incredible amount on our health benefits – more than $435m annually,” says Kehan. Oncology accounted for $28.9m, and rising – a trend faced by many companies. The findings were illuminating. “We had 442 members that had cancer at a cost of almost $15 million,” explains Kehan. Lung cancer among just 48 employees accounted for $7m.
These insights resulted in the V-BID Oncology Pilot focusing on five cancers – lung, breast, prostate, cervical and colorectal – which accounted for the majority of spending, and which MSD knew could be mitigated by high-value interventions such as screening.
2. Study your own data to identify opportunities to move from low-value to high-value care
To shift more funding into high-value interventions, it was critical to pinpoint ways of reducing unnecessary expenditure and low-value care, which may be costly but delivers relatively few health benefits.
Kathryn McKeon, Senior Corporate Account Executive and Global Market Access, Strategies & Affordability Solutions – US Employer Market, explains that MSD started with the Milliman Waste Calculator to identify potential opportunities. “It provides direction for reducing inefficiency in the system,” she says.
Conservative calculations indicated as much as $12m of waste in MSD’s health plan spending. “That level is not unusual for any large or medium-sized company,” says McKeon. Having a credible figure gave MSD a clear target: “We could look at taking that financial headroom and moving it over to oncology.”
To refine the picture, MSD worked with the digital services and HR analytics specialist EXL, using its health economics data to benchmark expenditure. That was reinforced by data from multiple sources, including social demographic data, medical claims and provider data. “We had to look at all the different parts to get a full picture,” says McKeon.
3. Use data continuously to refine and evolve the plan
The pilot scheme will continue to evolve to reflect patient needs, says Brian Kehan – in part thanks to new dashboards that make scheme data more accessible than ever. “The dashboards help us to home in on where people are getting their care,” he says. “So, we will be able to see where we need to make changes to the plan.”
That will be critical as the impact of Covid-19 on screening and diagnosis becomes clearer. “In 2020, we saw this huge drop in screening rates and doctor visits,” explains Kehan. “Some people have missed their window of opportunity to get screened and diagnosed early.”
Later diagnosis will mean worse outcomes for patients, and will significantly increase pressure on employer healthcare spending. “We're expecting higher and higher cancer costs,” Kehan adds, “simply because people weren't going to their doctors.”
Data dashboards make scheme data more accessible than ever
4. Share data-based insights to help other organisations
The MSD team is actively reaching out to varied stakeholders to share what it has learned from developing the V-BID Oncology Pilot. One audience is policymakers at US federal and state level, where the ideas behind V-BID have attracted bipartisan interest. Another is employers who are wrestling with similar challenges, to help them improve care for their employees. “We really want to be a role model for other employers in our approach to V-BID cancer care,” says Kathy McKeon.
MSD’s approach demonstrates what is possible with a focus on high-value care and a clear picture based on robust data – and McKeon is confident others will benefit from what the company has learned: “This is an extraordinary template.”
Find out here how MSD approached its design of the V-BID Oncology Pilot.
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Copyright 2022 Merck Sharp & Dohme LLC, a subsidiary of Merck & Co., Inc., Rahway, N.J., U.S.A., All rights reserved.
Copyright 2022 Merck Sharp & Dohme LLC, a subsidiary of Merck & Co., Inc., Rahway, N.J., U.S.A., All rights reserved.