Medicare Risk Products Can Be Profitable
Despite the bad rap Medicare risk products get for being unprofitable, there is a growing demand for them and health plans that are committed to long-term strategies are achieving healthy margins, according to Medimetrix, a national healthcare consulting firm. It's been an uphill battle to make these products viable.
Last year, 43 health plans terminated their Medicare risk products and 52 reduced their service areas on Jan. 1, 1999. These actions affected 400,000 enrollees of 6.5 percent of beneficiaries.
However, of the 400,000 that were affected, less than 1 percent were left without access to another managed care plan.
Why do some Medicare risk products succeed while others fail? The primary reasons include higher than anticipated medical costs and insufficient HCFA reimbursement, but there are also important factors that involve benefit design and marketing practices, according to Medimetrix. The most effective Medicare risk products have these marketing characteristics in common:
- Commitment to the long-term viability of the product.
- Extensive market research to understand consumer expectations and determine the best product design and advertising strategy.
- Smaller physician networks and per diem hospital reimbursement.
(Medimetrix, Terry Fox Stoller, 800/837-6334; email: [email protected])
Inpatient Database Offers Custom Analysis
A new InpatientView software program offers market researchers, product managers and marketers immediate access to hospital-based diagnosis and procedure data. Use this HCIA software to develop medical market analysis including patient demographics, hospital costs and related patient information for 1998.
(HCIA, Carolyn Anderson, 410/895-7497; http://www.hcia.com)
Agency/ People News
Joan V. Garcia joins Health Learning Systems as SVP and COO from New Jersey-based Interactive Science Incorporated, an education agency of Dudnyk Healthcare which he founded.
Jack Davis joins Healthview Advertising, a division of Healthview EURO RSCG, as COO. Davis oversees all advertising operations, including Lally McFarland & Pantello (LM&P) and LM&P Canada. Most recently Davis served as president of McCann-Erickson Consumer Health.
Medisphere Communications hires Peter Steinberg and brings back Douglas Stroup both as SVPs. Former VP /editorial director at Medisphere, Steinberg will now oversee medical communications. Stroup, after operating his own agency, will manage accounts for McNeil Consumer Products and teen-focused campaign "HIV. Live With It. Get Tested."
Saatchi & Saatchi Rowland Communications receives its first major award from DuPont Pharmaceuticals Company, DuPont Nutrition and Health, and Agricultural Enterprise. Kurt Landgraf, DuPont executive VP and COO, assigned Saatchi & Saatchi to the global agency of record after consolidating its public relations, direct marketing and global advertising.
Porter Novelli promotes Susan Hayes and Kathy Lauri to SVPs. Hayes will manage the global accounts of cardiovascular products Diovan and Lescol as senior account leader. Lauri will serve as senior counsel on key healthcare clients to drive the company's international business.
Lowe McAdams Healthcare receives new account from Schering-Plough for Asmanex (a mometasone furoate dry powder inhaler).
Lowe McAdams will develope product branding, promote and advertise Asmanex and launch programs targeting healthcare professionals.
Hastings Healthcare Group hires Dorothy Collins, Susan Harrow Rago, and Nina Sherak. Collins, formerly senior copywriter at Adient, becomes director of outcomes management. Rago joins as manager of program development. Sherak will serve as program development specialist for outcomes management.
Conference Update
If you attended the Customer Based Marketing Strategies conference in Phoenix, April 25-27, and want to purchase the audio cassettes from the sessions, they are available. HPRMN presented its healthcare awards at this conference.
The audio tapes include keynote addresses, marketing for ROI, relationship management, interactive technology, branding healthcare and physician strategies.
To order the tapes, call 888/869-8482, ext. 23 or email: [email protected].