Friday, May 21, 2010

Qliance Medical Management raises another $6M

Qliance Medical Management raises another $6M

Puget Sound Business Journal (Seattle) - by Peter Neurath

Qliance Medical Management Inc. has raised another $6 million in venture funding as it prepares to expand into California.
Seattle-based Qliance’s inexpensive “direct-care” model, which shuns health insurance, has survived recent passage of the federal health insurance law. The firm, in 2007, began selling its services to individuals, but small businesses — and now large ones — have been showing increasing interest.
“That’s the fastest growing segment for us now,” said Qliance CEO Norm Wu.
In the past year, Qliance has signed up some 50 small businesses, which have reported “savings of up to 50 percent over traditional insurance plans,” according to the company. Now large businesses and unions are negotiating with Qliance.
“We are in discussions with large health-care purchasers,” Wu said. “We’re seeing a lot of interest from them.”
This makes Qliance all the more attractive to venture investors, who see the Qliance model as a way to improve health care and make it more affordable while at the same time reducing costs. Under this model, consumers pay a set monthly fee for all primary care, with all the trimmings, and buy high-deductible health insurance to protect them from the cost of severe illnesses or accidents. Qliance charges a flat monthly price ranging from $44 to $84, depending on age.
“There’s a lot of people who want to give us a lot more money than we have room for,” Wu said.
Investors in this round were led by Bezos Expeditions and MSD Capital LP Other participants included comedian and Seattle Sounders co-owner Drew Carey and previous venture-fund investors Second Avenue Partners, New Atlantic Ventures and Clear Fir Partners.
“It’s not often you come across a business model that is truly transformational and disruptive in a sector ripe for reform, but that’s how we see Qliance in health care,” said Melinda Lewison, a Bezos Expeditions principal, in a statement.
Partner Nick Hanauer of Second Avenue Partners said, “Qliance is a game-changer that transforms the access, the quality experience of patients while also fundamentally improving the economics of health care.”
So far, Qliance has raised a total of $13.4 million in venture funding and has used it to open two more clinics, in Mercer Island and Kent.
Much more expansion lies on the horizon, beginning next year with California.
“The number of clinics (Qliance opens) depends on how many commitments we get,” Wu said.
“Our philosophy is, we will build it if they will come.”
Qliance, founded in 2006, has embraced the “direct care” model of delivering primary medical services, which excludes insurance companies as intermediaries between patients and doctors. Qliance refuses all forms of health insurance. Instead, for a monthly fee, patients can easily access Qliance doctors and nurse practitioners (13 in all) for such services as checkups, vaccinations, pneumonia, minor fractures, and ongoing care for chronic illnesses such as diabetes and hypertension. Patients can make same-day or next-day appointments for 30- to 60-minute office visits seven days a week.
Meanwhile, health care costs continue their upward surge nationally. In Wu’s view, the Qliance model “is a solution that potentially can get to the root causes of cost issues” by stressing basic medical care, through which patients are kept healthy or treated quickly when sick, thereby eliminating unnecessary specialty care, hospitalizations and emergency-room trips.
Several local businesses, including Total Living Concepts, Tri-tec Manufacturing and Becker Trucking, attest to cost savings by including Qliance in their health plans.
“It’s a good deal not only financially for us, but people love Qliance,” said Lyle Romer, executive director of Kent-based Total Living Concepts, a nonprofit organization providing services for adults with developmental disabilities.
In 2008, Total Living, with 63 employees, funded traditional health insurance, with no deductibles and with monthly premiums of $656, for a total cost of $495,936.
Last year, the organization began buying insurance with a $4,000 deductible, with monthly premiums of $202.
But it added Qliance services for its employees, at a monthly cost of $54 each, and promised to fund the $4,000 deductible for employees felled by serious illness or accident through a health reimbursement arrangement (HRA), which ended up costing Total Living a monthly average of only $22 per employee, for a total annual cost of $210,168 and total savings of 58 percent.

Thursday, May 20, 2010

Diagnostic Imaging Uses 57% of the Cost of Cancer Care

Diagnostic Imaging Uses 57% of the Cost of Cancer Care

Cheryl Clark, for HealthLeaders Media, April 28, 2010
The cost of treating cancer has been going up, but the cost of imaging to diagnose and stage those with the disease is skyrocketing, according to a report.
In fact, imaging tests in cancer care for Medicare patients accounted for 57% of all cancer costs in 2004, suggesting that the study population "represented the majority of cancer costs borne by Medicare beneficiaries."
Positron emission tomography scans increased the most, and in each of six types of cancer studied, from an average annual rate of 35.9% to 53.6% between 1999 and 2006, the period studied, says the report from Michaela Dinan, Kevin Schulman, MD, and colleagues from the Duke Clinical Research Institute in Durham, NC. Their research is reported in today's edition of the Journal of the American Medical Association.
Bone studies increased by 6.3% to 20%; echocardiograms by 5% to 7.8%; magnetic resonance imaging, 4.4% to 11.5%, and ultrasound, .7% to 7.4%.
"Beneficiaries with lung cancer and beneficiaries with lymphoma incurred the largest overall imaging costs, exceeding a mean of $3,000 per beneficiary within two years of diagnosis," the report says.
The cost of all cancer care increased 1.8% to 4.6% per year, but imaging grew at 5.1% to 10.3% per year.
The authors noted that while there "is little debate that imaging use has increased rapidly, there is less agreement about what the increases mean for Medicare beneficiaries and the Medicare program. Concerns have include d the high profit margins associated with imaging, payment incentives for imaging and the notion that rapid adoption of new medical devices and imaging technologies may be influenced by U.S. Food and Drug Administration approval requirements that are less stringent than requirements for new drugs," the authors wrote.
"Advanced imaging services are among the most frequent sources of competition among hospitals and physicians, and the use of advanced imaging appears to be additive in nature rather than a substitute for conventional imaging methods."
The researchers used Medicare claims data, sampling 5% of beneficiaries aged 67 or older for 1997 through 2008, including inpatient, outpatient, carrier, skilled nursing facility, home health, hospice and durable medical equipment claims for that period included under both Part A and Part B. Claims were counted in the two-year period following disease onset.
Patients with six types of cancer were included: breast and colorectal cancer, leukemia, lung cancer, non-Hodgkin lymphoma and prostate cancer.

Cheryl Clark is a senior editor and California correspondent for HealthLeaders Media Online. She can be reached at Follow Cheryl Clark on Twitter.


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