Skip to main content

Healthcare Data Worth its Weight in Gold

By Jeff Elliott, for HealthLeaders Media  
   January 12, 2011

For all the badmouthing of health insurers, one thing they deserve credit for is their ongoing attempts to lower medical expenditures.

Yes, it's in their best fiscal interest to pay fewer and less-expensive claims. But I wouldn't call it greed run amok. After all, about 60% of health plans nationwide with at least 100,000 medical enrollees are not-for-profit, according to the Alliance for Advancing Nonprofit Healthcare.

With exceptions—using a coverage loophole to reject a cancer treatment claim, perhaps—it's more of a preservation of interests. The problem is that these interests often don't jibe with those of healthcare providers, or the general public.

Over the years, health plans have tried a number of medical expense-lowering tactics, such as heavy-handed preauthorization and utilization guidelines, which theoretically are an effective way to ensure physicians aren't driving up the bill by administering unnecessary procedures. Amid severe pressure from physicians, and a realization that these efforts weren't doing the trick, insurers have moved on to more progressive strategies, including incentives for caregivers that improve quality and lower costs.

They're also getting the public more involved with their healthcare via wellness programs and, I hate to say it, higher out-of-pocket costs, which are forcing patients to ask, "Do I really need to see my doc for a sore throat?"

Yet with little recognizable slowing in healthcare costs, health plans are looking at new ways to lower their exposure to medical expenses. Turns out they're sitting on a treasure trove, so to speak: terabytes upon terabytes of medical data.

This reminds me of a Colorado tour guide who would point to some indiscriminate landscape and quip, "There's a billion dollars worth of gold in that thar hillside," to which everyone would hem and haw. And with a smirk, he'd go on to proclaim, "But it would cost a billion and a half to get it out."

With today's price of gold, perhaps he's underestimating its worth.

I assure you, health plans aren't taking the value of their data so lightly. And with the help of some innovative companies, they are mining this information with great expectation of significantly lowering healthcare costs.

Among them, benefits management firm BridgeHealth Medical is aggressively targeting their surgery niche with a predictive modeling tool called Early Indicators that extracts relevant, HIPAA-compliant claims data from health plan's or employer's database and estimates the probability a certain member population will require future surgery.

An oversimplified example might be someone who recently received at CT scan of their knee and it was determined that some damage exists. With a doctor's orders for physical therapy to correct the condition, the patient might attend a few sessions but soon tire of the process and quit.

These details are all available in claims data, if you know how to dig them out, which BridgeHealth does. And when they add a few other patient risk factors to the predictive model, a fairly accurate determination of the likelihood that this individual will require surgery can be determined.

Armed with this information, health plans and employers can devise an early-intervention wellness plan of sorts to help their members adhere to non-surgical treatment options. "Ultimately, this should result in a higher quality and lower costs," says BridgeHealth CEO Vic Lazzaro, who likes to point out a study from The Rand Corporation and Dartmouth University that indicates up to 30% of surgical procedures are medically unnecessary.

Perhaps this may be viewed as one more effort by big brother health plan to question physician judgment. I would hope not, however, if it in fact achieves its goal of medical cost reduction.

After all, if it does lead to healthier patients and fewer surgeries—or other procedures and tests which similar companies are trying to effect—maybe it will help alleviate the strain on qualified clinicians that's expected to increase exponentially when millions of new lives enter the healthcare system under reform.

Tagged Under:


Get the latest on healthcare leadership in your inbox.