DM Industry remains challenged on how to calculate ROI?

Measuring ROI [Return on Investment] in DM Programs: The Economic Promise of DM…has it changed?

By Warren E. Todd
Executive Director, IDMA

I was recently asked by an international colleague from Germany about what types of ROIs one could expect from disease management programs.

Despite having a pretty good archive on DM I must admit that aside from the Goetzel et al meta-analysis [summer of 2005], most of the "recent" articles on DM ROI appeared to mostly address how to measure DM, what the methodology issues are, etc. While it was not a very rigorous search I was surprised by the seeming dearth of actual ROI data on DM programs. Perhaps I was looking “in all the wrong places.”

Notwithstanding, my “surprise” also raised a concern that perhaps the continued “great debate” over ROI, the best methodologies, etc. has caused some authors to “go underground” as far as talking about or, God forbid, publish anything with a hard ROI associated with it.

Base on discussions with a number of knowledgeable outcomes researchers, It does seem that we have moved from expectations [and declarations] of ROIs in the 3 to 1 or 4 to 1 …..or higher…. to maybe 2 to 1 or less.

Despite the many initiatives by DMAA that have resulted in several published "guides" on how to measure DM outcomes, plus the hard work of a number of industry actuaries, epidemiologist and outcomes researchers, there still seems to be very little published material that includes specific information on DM ROIs.

After investing many hundreds of millions of dollars on disease management over the past decade or more, it seems that we should have more data on actual performance including financial performance metrics like ROI.

I was also very concerned to have one of the recognized pioneers of DM in the United States suggest that a 1 to 1 ROI [in the short run] is probably the most likely performance for many of these programs and that it may take 2-3 years of program operation to begin to achieve 1.5 or 2.0 to 1 ROIs.

REQUEST FOR INPUT: IDMA will be researching this area more fully but in the meantime would appreciate readers submitting information on articles on DM that do in fact include on ROI data.

Please send this information to wtodd@dmalliance.org. We will compile the information submitted along with our own research and make this available to e-Report readers.