1. Innovation Profile:
Case Managers Remotely Monitor Chronically Ill Medicare Beneficiaries Each Day, Reducing
Mortality and Costs
Snapshot
Summary
Registered nurse case managers remotely monitor Medicare beneficiaries with diabetes, congestive heart
failure, and/or chronic obstructive pulmonary disease. Each day, patients respond to disease-specific and
general health questions posed by Health Buddy, a home-messaging device. The device transmits their
answers to a Web-based application that organizes the data, stratifies responses according to risk, and
highlights out-of-range values. Case managers use this information to quickly pinpoint health issues and
respond accordingly, usually by calling the patient to offer care and self-management support and/or
by contacting his or her physician. The program significantly reduced mortality and health care costs.
Evidence Rating (What is this?)
Strong: The evidence consists of a randomized controlled trial that compared mortality rates and health
care spending in program enrollees to a matched group of similar patients who did not participate.
Developing Organizations
Bosch Healthcare; Wenatchee Valley Medical Center
Wenatchee, WA
Date First Implemented
2006
January
Patient Population
This program targets Medicare beneficiaries with diabetes, congestive heart failure, and/or chronic
obstructive pulmonary disease.Age > Aged adult (80 + years); Vulnerable Populations > Frail elderly;
Insurance Status > Medicare; Vulnerable Populations > Rural populations; Age > Senior adult (65-79 years)
What They Did Back to Top
Problem Addressed
Chronically ill individuals—such as those with congestive heart failure (CHF), chronic obstructive
pulmonary disease (COPD), and diabetes—often develop complications that prompt the need for
expensive interventions, including emergency, inpatient, and/or long-term care. While ongoing
monitoring can prevent some of these complications (especially for older patients), relatively few
health systems provide such services.

2. High costs of chronic illness: Chronic disease care accounts for nearly 80 percent of all health
care spending1; the Centers for Medicare and Medicaid Services (CMS) estimates that beneficiaries
with five or more chronic illnesses account for just over three-fourths of Medicare
spending.2 Patients with chronic illnesses often require hospitalizations to treat exacerbations or
complications associated with their condition(s). For example, CHF is the leading cause of
hospitalization for older individuals, with almost a third of hospitalized CHF patients requiring
readmission within 30 days of discharge.3 High utilization and costs occur for a number of reasons,
including inadequate patient self care, followup after discharge, and continuity of care.1,4
Unrealized benefits of monitoring: Ongoing monitoring of chronically ill individuals, especially
older patients, can allow providers to intervene in a timely fashion, helping to prevent exacerbations
and complications, reduce care costs, and keep patients in their homes. However, relatively few
health systems have the capacity to monitor chronically ill individuals who live in the community.
Description of the Innovative Activity
Registered nurse case managers remotely monitor Medicare beneficiaries with diabetes, CHF
and/or COPD. Each day, patients respond to disease-specific and general health questions posed
by Health Buddy, a home-messaging device. The device transmits responses to a Web-
based application that organizes the information, stratifies it according to risk, and highlights
out-of-range values, allowing case managers to quickly pinpoint health issues and respond
accordingly, usually by calling the patient and/or physician. Key program elements include the
following:
Identifying and enrolling eligible patients: Using a list of objective criteria that indicate a high
risk of an exacerbation, physicians identify eligible patients and describe the program to them. For
those interested, the physician contacts a registered nurse case manager to complete the
enrollment process. Eligibility criteria include, but are not limited to, the following:
o Diabetes: Criteria include poorly controlled blood glucose, recent hospitalizations, more
than three office visits in 3 months, and/or symptomatic hypoglycemia.
o COPD: Criteria include use of chronic steroids, use of chronic oxygen, and/or multiple office
visits or a recent hospitalization.
o CHF: Criteria include ejection fraction rate (a measure of how effectively the heart pumps
blood) below 40 percent, use of high-dose diuretic medication, and/or multiple office visits
or a recent hospitalization.
Patient assessment and device demonstration: The case manager meets with the patient in
the clinic to perform a formal assessment and demonstrate use of the device.
o Formal assessment: The assessment involves a full review of the patient's medical history
(including all diagnoses), health concerns, psychosocial needs (including screening for
depression), risk of falling, caregiver support, medications, and activities of daily living. The
case manager uses this information to determine the individual questions or bundles of
questions (by diagnosis) that should be posed by the device each day and programs it

3. accordingly.
o Demonstration of device: The case manager gives the device to the patient and explains
how to set it up in the home through connection to a telephone line or wireless network.
The case manager demonstrates how to operate the device through four buttons on a large,
high-resolution color screen, and explains the circumstances under which he/she will
contact the patient to discuss the information transmitted.
Daily responses to questions via device: Each day, the patient uses the device to read and
respond to a series of questions regarding his/her health. Objective questions probe specific
issues relevant to underlying health condition(s), such as vital signs, blood glucose level, and
weight. Subjective questions cover current symptoms, general well-being, and quality of life, which
the patient rates as green, yellow, or red depending on his/her perceptions of the severity of
symptoms.
Daily monitoring by case manager: Responses are uploaded to a Web-based application that
provides case managers with an automatic summary each day. The application stratifies
the responses according to risk, using color-coded alerts based on acceptable ranges for each
indicator (red for high, yellow for moderate, and green for low risk). This information helps the case
manager to triage patients and, as he or she sees fit, intervene with those at moderate to high risk.
The case manager usually provides care and self-management support over the phone, although in
some cases may schedule an office or home visit or in urgent situations may instruct the patient to
seek immediate care from his or her physician or from emergency services.
Followup with physician: In non-urgent situations, the case manager e-mails the patient's
physician or includes a note in the patient's electronic medical record. When an urgent need arises,
the case manager may telephone the physician to arrange a same-day appointment for the patient.
Biannual patient education: Each year, the medical center offers two educational programs
related to each diagnosis. At these sessions, patients can hear speakers and obtain additional self-
management education relevant to their condition(s).
References/Related Articles
Baker LC, Johnson SJ, Macaulay D, et al. Integrated telehealth and care management program for Medicare
beneficiaries with chronic disease linked to savings. Health Affairs. 2001 Sept;30(9):1689-97.
Information about the Health Buddy system is available at: http://www.bosch-
telehealth.com/content/language1/html/5578_ENU_XHTML.aspx.
Contact the Innovator
Peter D. Rutherford, MD
Chief Executive Officer and Board Chair
Wenatchee Valley Medical Center
700 North Chelan Avenue
Wenatchee, WA 98801-2069
(509) 664-4868 x5484

4. E-mail: prutherford@wvmedical.com
Did It Work? Back to Top
Results
The program reduced mortality and health care costs.
Fewer deaths: A randomized controlled trial found that the mortality rate among participants was
2.6 percentage points lower than in a control group of similar patients who did not participate (9.7
percent versus 12.3 percent). (After the first year, the mortality rate for participants was only
slightly lower than that of non-participants.)1
Lower costs: In the first year, health care spending per patient averaged $3,608 per quarter for
program participants, roughly 10 percent below the $4,107 average for non-participants. This
differential persisted into the second year ($3,568 quarterly average for participants, $4,051 for
non-participants).
Evidence Rating (What is this?)
Strong: The evidence consists of a randomized controlled trial that compared mortality rates and health
care spending in program enrollees to a matched group of similar patients who did not participate.
How They Did It Back to Top
Context of the Innovation
Wenatchee Valley Medical Center, located in Wenatchee, Washington, is a large, rural system that includes
outpatient clinics in eight communities and Wenatchee Valley Hospital that treats medical, surgical, and
acute rehabilitation patients. The hospital has an average daily census of 110 patients, roughly half of whom
are Medicare beneficiaries, while the medical center treats about 175,000 outpatients each year, about a
third of whom are covered by Medicare. The impetus for this program came from Wenatchee Valley Medical
Center executives, who learned about Health Buddy from a local gastroenterologist whose son founded the
company (Health Hero Network) that developed the device. (Health Hero Network has since been acquired
by Bosch Healthcare, which develops technologies to allow clinicians to manage patient health remotely.)
These executives decided to pilot test the program as a way to improve quality and reduce costs associated
with chronic disease (particularly exacerbations), without imposing significant additional burdens on time-
pressed physicians. Wenatchee Valley Medical Center tested the program as part of CMS' Care Management
for High-Cost Beneficiaries Demonstration Project, initiated in 2004 to evaluate care management
approaches with the potential to reduce spending and improve outcomes for high-risk, high-cost
beneficiaries. The Health Buddy system became one of six strategies evaluated as part of this project.
Planning and Development Process
Selected steps included the following:
Presenting idea to board: Wenatchee executives discussed Health Buddy with the medical
center's board of directors, which granted approval to test the system.
Applying to CMS demonstration project: Health Hero Network and Wenatchee Valley Medical

5. Center successfully applied to the CMS Care Management for High-Cost Beneficiaries Demonstration
Project.
Developing protocols: To inform the questions presented on the device, Wenatchee Valley
executives and physicians developed protocols that outline best practices for monitoring patients
with CHF, diabetes, and/or COPD. They used published literature and guidelines from professional
organizations, such as the American Diabetes Association, American College of Cardiology, and
American Heart Association. Physicians reviewed and provided feedback on the draft protocols,
which went through several revisions before being finalized.
Inviting physicians to participate: The medical center executives met with physicians to solicit
their interest in participating in the program.
Hiring and training case managers: The medical center hired and trained five case managers.
Training consisted of education and hands-on practice related to the protocols, device, motivational
interviewing, and coaching.
Resources Used and Skills Needed
Staffing: Five case managers (registered nurses) staff the program, three of whom work full time
at the medical center's clinics in Wenatchee, and two of whom work part time at smaller clinics in
outlying areas. A full-time case manager can monitor approximately 150 patients.
Costs: Monthly program costs average roughly $128 per patient.
Funding Sources
Centers for Medicare and Medicaid Services; Wenatchee Valley Medical Center
CMS funded the program throughout the 3-year demonstration project and a 3-year extension, with the
trial ending in January 2012. After this time, the medical center will use the program for patients covered by
capitated payment systems (because the medical center reaps the benefits of any cost savings generated
for these patients). Program leaders are currently investigating whether commercial payers would be willing
to cover all or part of the program's costs for non-capitated patients, because savings for these patients will
accrue to the payers.
Adoption Considerations Back to Top
Getting Started with This Innovation
Cultivate physician support: Expect some resistance on the part of physicians, who may not want
a case manager "getting in the way" of their interactions with patients. Program leaders can help
physicians feel more comfortable with the approach by emphasizing the case manager's role in
reducing readmissions and by engaging physicians in the development of the clinical protocols used
within the device. Physicians typically support the system once they see its clinical benefits.
Encourage positive word-of-mouth: Patients who engage in self-management tend to embrace
the program readily, but others may be more reluctant. In small communities, positive testimonials
from patients about the increased attention they receive as a result of the program can encourage

6. reluctant patients to try it.
Sustaining This Innovation
Be responsive to patients: Patients need to do more than just interact with the messaging
device. To ensure their satisfaction, they need to see that the case manager and physician respond
to the information they provide.
Review protocols on ongoing basis: Clinical knowledge evolves over time in ways that can make
the protocols underlying the program out of date. To address this issue, program leaders should
review and, if necessary, revise the protocols at least once a year to make sure they conform with
the latest scientific findings.
Encourage case managers to get to know their patients: Patients respond in different ways to
subjective questions; some respond negatively to even small changes in health status, while others
may report feeling well even when an important indicator has declined significantly. Consequently,
case managers need to learn about the unique personality of each patient, which allows them to
respond appropriately to the situation at hand.
Solicit payer reimbursement: Payers may be willing to financially support the program,
particularly if they see proof that it reduces costs (e.g., by avoiding readmissions) and/or improves
outcomes.
Consider ongoing need for patients who improve: Some patients who improve as a result of
the program may not need to remain in it, particularly those who learn to manage their conditions
effectively. Others may need the discipline of daily reporting to remain on track.
Additional Considerations and Lessons
Disclosure: The innovator did not have any financial relationship with Bosch Healthcare during the
randomized controlled trial. In December 2011, Wenatchee Valley Medical Center signed a
consulting agreement with Bosch Healthcare to provide a mechanism for the Medical Center to be
reimbursed for time that might be spent helping other health care organizations learn how to
conduct a similar program. As of January 2012, there has been no use of that contract.
Use By Other Organizations
Bend Memorial Clinic in Bend, Oregon, tested the program as part of the same CMS demonstration
project and is also continuing evaluation of the program through the 3-year extension period.
1
Baker LC, Johnson SJ, Macaulay D, et al. Integrated telehealth and care management program for
Medicare beneficiaries with chronic disease linked to savings. Health Affairs. 2001 Sept;30(9):1689-97.
2
Swartz K. Projected costs of chronic diseases. Health Care Cost Monitor. January 22, 2010. Available at:
http://healthcarecostmonitor.thehastingscenter.org/kimberlyswartz/projected-costs-of-chronic-diseases/

7. 3
Landro L. Keeping patients from landing back in the hospital. The Wall Street Journal. December 12, 2007.
Available at: http://www.inqri.org/AbouSubL-1399.html
4
Transforming care at the bedside how-to guide: creating an ideal transition home for patients with heart
failure. The Institute for Healthcare Improvement and the Robert Wood Johnson Foundation. October 2007.
Available at: http://www.ihi.org/knowledge/Pages/Tools/TCABHowToGuideTransitionHomeforHF.aspx