Financial Stability of a Taft-Hartley Benefit Trust Fund

Case Study | July 2015

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Consumer Behavior Success Story

Working with Cigna, a large Taft-Hartley Fund doubled their savings goal of $7 million—saving $15 million in three years. This union leadership’s commitment to increase member communication and engagement was the key contributor.

The Challenge

  • Save $7 million
  • Improve the financial condition of their Benefit Trust Fund without significantly effecting member cost
  • Become better consumers of health care and be part of the solution

Population Facts

  • 17,000 Cigna customers
  • Multiple locations
  • Self-funded

How We Did It

In late 2011, the Fund’s plan professionals approached the Cigna Account Team asking for advice to help improve the financial condition of their Benefit Trust Fund.

To safeguard against effecting member costs, the plan professionals agreed with Cigna to focus on value based plan design changes, concentrating on proven Cigna strategies such as teaching members how to shop for more cost effective health care providers, as well as how and when to engage in the clinical support programs available to them. Initiatives under these priorities would be used to drive the necessary cost savings for the Benefit Trust Fund.

The Cigna team identified specific utilization pattern opportunities and provided both recommendations to teach members how to be better consumers of health care, and plan design modifications to incent members to make better health care decisions.

Member outreach and education initiatives were implemented to address the following utilization pattern opportunities:

  • Building a relationship with a primary care physician versus self-referring to specialists
  • Urgent Care provider capabilities and locations
  • Appropriate use of the Emergency Room
  • Importance of using the newly available preventive care benefit
  • Better management of chronic conditions
  • Addressing lifestyle challenges

A Call to Action

The President of the union gave the membership a call to action: become better consumers of health care and be part of the solution.

Their Cigna client team responded to the Fund’s request for savings solutions with a number of practical actions:

  1. Add Personal Health Solutions Plus (PHS+) an enhanced utilization and care management approach.
  2. Change deductible/copay/out-of-pocket maximum.
  3. Implement Cigna Care Network® and tiered copays, encouraging visits to high performing primary care physicians and specialists.
  4. Use Cigna Value Prescription Drug List (PDL) to drive a lower cost plan to the Fund while maintaining a clinically complete pharmacy program for the membership.
  5. Modernize pharmacy plan: add Cigna Value Pharmacy, step therapy and Narcotics Therapy Management.
  6. Move to a Medicare-based maximum reimbursable charge methodology to contain out-of-network claims costs.
  7. Initiate robust communications program including specific provider steerage campaigns.

The Power of Solidarity

The union’s ability to leverage their trust and credibility with its membership enabled them to quickly build solidarity around how to make better health care decisions.

By the end of 2013, the Fund had exceeded its savings goal of $7 million! Almost every plan modification generated savings. Most notable were these 2012 reductions:

  • $4 million saved with Cigna Pharmacy Plan.
  • $600,000 saved with outpatient precertification for 1,838 individuals.
  • $2.9 million in savings with health advocacy/care management.
  • $2.4 million saved with MRC2.

The union leaders developed and executed on a grass roots communication campaign including a list of specific actions they were asking members to take. They worked tirelessly to get the communications out through a variety of different media. The union’s plan had clear deliverables and metrics to measure the success of their asks.

Health Advocacy and Care Management

Cigna is actively engaged with thousands of the Fund’s members and their families through case management, health assessments, online coaching and wellness education. PHS+ helps participants access the services most appropriate for them. Through enhanced precertification and case management, the costs to the Fund were lowered, plus their membership avoided unnecessary procedures.

  • Outpatient precertification touched over 1,800 individuals.
  • 364 unnecessary MRIs were avoided.
  • Inpatient admissions per 1,000 decreased 11%.
  • Bed days per 1,000 decreased 16%.
  • Preventive care increased.

Cigna Care Network

Since offering the Cigna Care Network (CCN) to active members residing in CCN service areas, CCN visits increased 250%.

  • Primary care office visits increased 4.5%.
  • Costs per specialty visit decreased 28%.
  • CCN providers represented 55% of expenses in 2012 vs. 28% in 2011.

Pharmacy

After the Fund implemented the Cigna Value PDL, Step Therapy, Enhanced Clinical Modules, Narcotics Therapy Management, and a change in plan design, they started to see results:

  • Generic prescription use increased from 74.4% to 83%.
  • 108 individuals were identified with multiple narcotic/controlled substance prescriptions. After intervention, costs per member dropped 51%. 43% of savings was related to medical cost savings.

Results

Member out of pocket costs are down, the Benefit Trust Fund is financially stable, Fund reserves are up, and members are more educated and engaged consumers of health care—which will help drive a more favorable cost trend going forward.

taft-hartley-benefit-trust-fund-white-paper-1-16x9-lg.jpg

Culture of wellness

has taken root

Healthier decisions

among plan membership

218% increase

in clinical management program engagement

$15 million

saved in three years

All statistics are based on a 2015 internal Cigna client study. Individual client results will vary.

All Cigna products and services are provided exclusively by or through operating subsidiaries of Cigna Corporation, including Cigna Health and Life Insurance Company and Connecticut General Life Insurance Company. The Cigna name, logo, and other Cigna marks are owned by Cigna Intellectual Property, Inc.

877698 07/15 © 2015 Cigna. Some content provided under license.