Memorandum

Medicare to reimburse Diabetes Prevention Program (DPP); estimated savings of $2,650 for each person in YMCA program – March 30, 2016

Executive Highlights

  • Last week, HHS Secretary Ms. Sylvia Burwell announced that Medicare will reimburse the Diabetes Prevention Program (DPP). The DPP has demonstrated cost-effectiveness via its YMCA pilot (n=8,000) in eight states: Medicare estimated savings of $2,650 for each person enrolled over 15 months, more than covering the program’s cost.
  • The historic reimbursement news has received praise from the ADA and the Endocrine Society; Omada Health (the largest CDC-recognized DPP provider in the US) also released its own press release and blog post celebrating the news.
  • The news is exciting for many reasons: (i) broadening DPP access to over 22 million American seniors with prediabetes; (ii) showing that diabetes prevention and modest weight loss is worth investing in, even short-term!; (iii) hopefully pushing private payers to expand DPP coverage; and (iv) paving the way for other Medicare pilots in diabetes?

We’re back with our expanded coverage of last week’s exciting news that Medicare will reimburse the Diabetes Prevention Program (DPP), delivered both in person and in digital form. Health and Human Services (HHS) Secretary Ms. Sylvia Burwell announced the news on the sixth anniversary of the Affordable Care Act, which included the key enabling provision back in 2010: Medicare can cover demonstrated cost-effective programs without Congressional approval. The DPP has officially met the bar!

As part of a demonstration with the YMCA, the DPP was conducted in eligible Medicare seniors (n=8,000) at 17 pilot sites across eight states. Average weight loss was a solid 4.7% of body weight for participants attending at least four weekly sessions (over 80% did). Medicare estimated savings of $2,650 for each enrollee over a short 15-month period, more than enough to cover the cost of the program. Medicare officials should provide more payment details in the regulation proposal that will go out for public comment this summer. Without the need for Congressional approval, of course, it seems highly likely this will go through. This is the first time that a preventive service model from the CMS Innovation Center has become eligible for expansion into the Medicare program.

The news is tremendously exciting for people with prediabetes, who should now get easier and cheaper access to the proven DPP. We also see it as encouraging from an investment perspective – low-cost diabetes prevention and modest weight loss (~5%) programs have payback in just 15 months! We hope private payers will take this news seriously and reimburse for DPP initiatives in a bigger way. While awareness and implementation are always a challenge, we look forward to a day when providers automatically prescribe the DPP in tandem with a prediabetes diagnosis. From there, patients will hopefully have a menu of programs to enroll in.

The reimbursement win has received praise in press releases from the ADA and the Endocrine Society. Omada Health was quoted in the NYT story and released its own press release and blog post celebrating this very welcome news. The company is now the largest CDC-recognized DPP provider in the US, having treated “about 50,000 patients.” CEO Mr. Sean Duffy summed it up well: “This is monumental news for the 51% of American seniors – more than 22 million – at risk for type 2 diabetes. Make no mistake, we in the diabetes community will look back on this day as a tipping point.” We couldn’t agree more!

  • Omada Health’s Chief Commercial Officer Mr. Mike Payne actually hinted toward this expansion at SXSW Interactive a few weeks ago, though we’re elated – and even a bit shocked – to see it actually happened. We look forward to seeing the regulation proposal this summer and hope the implementation goes smoothly.
  • Could this news have broader implications for diabetes and prediabetes drug and device reimbursement? What other Medicare pilots are possible to secure reimbursement of drugs (e.g., metformin in prediabetes), devices (e.g., CGM, automated insulin delivery), and behavioral programs?
  • The DPP expansion demonstrates the power and cost-effectiveness of utilizing allied health professionals to prevent chronic disease. According to the NYT coverage, Dr. Matt Longjohn (Chief Health Officer, YMCA) emphasized that the DPP’s results “vindicate the role of ‘lay health workers,’” as they can “deliver preventive services at a much lower cost than doctors” and whose services are “just as effective in terms of weight loss.” We would agree that the DPP’s use of non-MD staffing is an outstanding model for cost-effectively scaling prevention in a growing aging population. According to Omada Health’s blog, the number of people over age 65 in the US is projected to increase to 73 million by 2030 (48% higher than 2015 levels) and Medicare spending is projected to grow at an average annual rate of 7% from now to 2024. These startling statistics stress the need for programs that scale beyond the limited physician population. Notably, AADE is working with the CDC to expand access to lifestyle coaching for the DPP.
  • Awareness is arguably the biggest barrier facing the DPP. Previous CDC data has demonstrated severe underutilization of diabetes self-management education and training, even among privately insured individuals within the US. Assuming this program goes into effect, we hope Medicare prioritizes awareness and makes it easy for individuals to enroll in the DPP. The vast ocean of 86 million Americans with prediabetes leaves a lot of work to do- even reaching 1 million people with the DPP is just 2% of the target market (Omada has reached ~50,000 to date, while the YMCA has reached less than that as far as we understand).
    • Perhaps the ADA/CDC/AMA’s recent and provocative prediabetes awareness campaign can make a significant impact. Similarly, we hope that the AMA/CDC’s Prevent Diabetes STAT Initiative will also take charge in providing physicians with the resources to better educate patients on the DPP.
    • Omada Health plans to continue working with HHS on DPP implementation. Sean Duffy shared hopes to “provide data, evidence, and implementation insight to the team at HHS to ensure that the diabetes prevention benefit is implemented effectively, and reaches as many eligible beneficiaries as possible.” With Omada Health’s work with various healthcare players and its marketing expertise with Prevent, we hope this collaboration will also expand uptake and awareness.
  • Last November, Omada Health and Humana announced topline results from the pilot trial of Prevent in 491 Humana Medicare Advantage beneficiaries: participants (who completed 9+ lessons) lost an average of 8.7% of body weight at six months. These findings are especially notable, as they demonstrate meaningful clinical results but also prove that digital health and technological approaches remain effective in older populations. Omada Health has devoted significant attention to this particular issue, as recent blog posts from the company emphasized the growing aging population and “tips for engaging seniors in preventive health benefits.” The latter is a fascinating read.
  • The government has not provided details on how it will pay for the DPP. Medicare officials should provide more payment details in the regulation proposal that will go out for public comment soon According to the NYT coverage, options could include Medicare reimbursing DPP providers directly or paying for services as part of a package.

Close Concerns Questions

Q: How can Medicare and CDC expand awareness of the DPP?

Q: How will the government fund the expanded DPP reimbursement?

Q: Can digital programs scale to reach millions and tens of millions?

Q: Will private payers gradually change their reimbursement policies following this news?

Q: What other Medicare pilots are possible to secure reimbursement of drugs (e.g., metformin in prediabetes?), devices (CGM, automated insulin delivery?), and behavioral programs?

 

-- by Melissa An, Adam Brown, and Kelly Close