Quality Improvement and Cost Reduction Realized by a Purchaser Through Diabetes Disease Management

This report documents the clinical improvements and costs experienced by a purchaser after introduction of a diabetes disease management program. A purchaser contracted with American Healthways, a disease management organization, to initiate a diabetes disease management program called Diabetes Decisions. Started in 1998, the program grew to include 662 participants. The results reported are based on the continuously participating population (12 months of participation in the program for the reporting year). Participants were entered into American Healthways' clinical information system and risk-stratified, and an individualized treatment plan was devised. Outbound telephone calls by specially trained nurses were a key intervention. Data were collected on key process measures, financial parameters, and participant satisfaction. By year 3, there were 422 continuously participating participants. From baseline to the third year of the program, significant increases in frequency of A1C testing (21.3% to 82.2%), dilated retinal exams (17.2% to 70.7%), and performance of foot exams (2.0% to 75.6%) were noted. For 166 participants with five A1C determinations, A1C values dropped from 8.89% to 7.88%. Participants experienced a 36% drop in inpatient costs. Without adjustment for medical inflation, total medical costs decreased by 26.8% from the baseline period, dropping to $268.63 per diabetes participant per month (PDPPM) by year 3, a gross savings of $98.49 PDPPM. After subtracting the fees paid to Diabetes Decisions, a net savings of $986,538 was realized. This yielded a return on investment of 3.37. By investing in a diabetes disease management program, a purchaser was able to realize significant improvements in clinical care, substantial cost savings, and a favorable return on investment.