With health costs steadily rising and health benefits being the #1 priority when evaluating potential employers, HR administrators and brokers need access to cutting-edge analytics tools now more than ever.
The best analytics tools will enable HR administrators and brokers to assess utilization, identify cost drivers and understand trends that are taking place within their health plans. They should also provide insights on how a health plan can be customized to meet the needs of their particular member populations.
So, with so many options in the market, what should brokers and employers look for in an analytics solution? In today’s post, Justin Forton, Vice President of Analytics & Insights at HealthComp, outlines the four dimensions of a powerful analytics solution.
Dimension I: Reporting or Descriptive Analytics
Reporting – or what’s often referred to as “descriptive analytics” – allows brokers and HR administrators to evaluate the performance of their health plan. Reporting should be comprehensive in nature and include a library of standard reports, including census, paid claims, and plan cost summary reports.
Administrators and brokers should also have access to on-demand reporting, which enables users to generate reports “on the fly” using real-time data. Flexibility is key, and the most robust solutions will include options for user to customize reports by date range and other variables. Users should also have the ability to schedule reports to be generated at regular intervals. Lastly, security protocols must also be in place so only users with designated permission have access to protected health information (PHI).
Dimension II: Dashboard & Drill-down Capabilities
While reporting enables users to review past plan performance, analytics provide insights to improve future performance. Essentially, analytics enable administrators and brokers to turn big data into actionable insights that can optimize their healthcare spend and the overall health of their population. The most effective analytics solutions present plan data in a dashboard format that displays key performance indicators (KPIs) and metrics. Displaying these data points on one screen provides a snapshot of what’s happening with a plan’s health care spend.
HealthComp has built several proprietary dashboards to help administrators and brokers monitor the performance of a plan, including metrics on utilization, network penetration, high-cost claimants, costs or claims by age range, and costs or claims by providers.
Dashboards should be user-friendly and provide users with the ability to click on a data point to “drill-down” and view more detailed information contributing to a particular statistic. For example, to analyze its health care spend, an employer can review their claims broken down by month. To determine what led to an increase in spending during a particular month, they can drill-down into the data, and determine that that additional claims came from a newly added work location or from employees who had to undergo cancer treatment. This is one example of how a good analytics solution can empower an HR administrator or broker to better understand the cost drivers behind their health care spend.
The landing page of HealthComp’s analytics solution includes a dashboard that provides a high-level overview of a health plan’s performance. Users can adjust the date range and view the number of claims, total paid claims, and the percentage change over the previous year. For instance, a group may observe a 2% drop in claims volume in the current versus previous year, but a 5% increase in the total amount spent. In this way, the dashboard begins to tell a story about the group’s healthcare spend and drives insights.
Dimension III: Benchmarking
Benchmarking is a practice of comparing one organization’s performance with others in aggregate. In order for benchmarking to be accurate, multiple organizations must agree to contribute their data so they can understand what metrics constitute “peak performance” and what best practices result in that level of performance.
The most effective analytics solutions will incorporate trusted benchmarking measurements, such as the John Hopkins Healthcare Effectiveness Data and Information Set (HEDIS). This enables brokers and employers to compare their plan performance to other plans and determine if they have room for improvement and, if so, how much improvement is achievable.
Dimension IV: Predictive & Prescriptive Analytics
The fourth dimension is predictive and prescriptive analytics. Predictive analytics utilizes big data to forecast what might happen in the future, while prescriptive analytics goes a step further, suggesting a course of action that could produce a more positive end result.
One of the ways HealthComp has incorporated predictive and prescriptive analytics is to identify potentially at-risk and high-cost populations, such as diabetic patients, and determine if they have been compliant with treatment guidelines. For example, a plan may identify plan members diagnosed with diabetes who have not regularly undergone HBA1c testing. Predictive models identify this non-compliant group as at risk of incurring potentially high-cost health services. In terms of prescriptive analytics, members who are identified as non-compliant could be referred to our disease management program to help them better manage their diabetes.
The predictive model can also forecast costs likely to be incurred by non-compliant members. For example, if a non-compliant member renews his plan, the system would project that he could cost the plan $68,000 over the following year due to risks associated with his health condition(s), his pattern of accessing medical services, and his history of non-compliance with treatment guidelines. Armed with this information, the HR administrator may decide that this member is a promising candidate for disease management programs and strategies.
Amplifying Performance into the Future
A good analytics solution harnesses big data and breaks it down into actionable insights that actually improve a health plan’s performance. Brokers and employer groups will better understand where their healthcare dollars are going and how they can optimize their plan design to streamline spending and improve the health of their population. They can also use this data to evaluate wellness and disease management programs to help address problem areas. To ensure you’re leveraging a powerful and smart analytics solution, be sure that your solution includes the four dimensions outlined in this article.