healthcare

Analytics For Employers: A Tutorial (Part 2)

A succinct guide on how to save money on employer-sponsored healthcare

A succinct guide on how to save money on employer-sponsored healthcare

Over the past 3 years, the most common question we have heard from employers and brokers is this: health analytics is good, but what do we do with the dataWell, we are going to answer that question in this very post. That’s right, we’re sharing all the most actionable areas we look at for self-insured employers to help them to gain control over their spending. Some may say that we’re giving away our secrets, but we don’t see it that way. Our mission for employers is to make them savvy health care consumers, so making information transparent is what we do. Furthermore, it’s important to open up conversations on how organizations are using analytic data, because these conversations will help to advance insight and foresight so employers can use their data to create, track and refine a long-term strategy for the benefits they offer.

In Part 1 of this post we established that for employers, the best strategy for using health analytics moves beyond simply looking at spending to enter the realm of strategic benefit planning. This is the limitation of traditional healthcare analytics. Over the next decade, we will continue to see employers move away from watching spending go up and down and move towards looking at data in a way that provides both insight and foresight into population health. The next evolution of employer analytics informs a deeper understanding of who associates are, the benefits that will attract the best talent, and identifying the optimal strategy for funding these next-generation benefits packages.

To start, we pulled together a list of areas that any employer can explore if they want to ensure they’re using data to guide their spending decisions on health benefits. We've broken this into 3 sections: 1) Goals, 2) What's Actionable? and 3) Areas of Insight.

Beginning with the end in mind, here are the top goals that self-insured employers have when it comes to monitoring their health spending.

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Goals:

1.      To cut excess and wasteful healthcare spending and to accurately project future spending. Approximately 20% of an employer’s healthcare spending is wasted due to unnecessary and preventable costs. Open access to data helps to inform employers on exactly what areas are driving wasteful spending and how to better predict future spending.

2.      Identify strategies to support associates on their health journeys. While 5% of people drive 51% of health costs, 50% of plan members account for only 3% of health spending. Understanding how to support the unique, complex health needs of members affects a company’s bottom line in both healthcare costs and employee productivity.

3.      Track progress on the current healthcare and wellbeing strategy. An unbiased evaluation of a healthcare program is eye-opening. Not only does it guide the strategic evolution of an employer's healthcare strategy, it may reveal opportunities to recoup hefty vendor performance guarantees.

4.      Make sure members are getting the preventative medical attention they need. We consistently see that between 10%-20% of members never see a doctor. It’s within this group of people who are not driving costs today where an employer’s greatest future healthcare risks can lie.

In order to meet these goals, an organization needs to identify what exactly can be actionable. It's easy to spot the costs that stick out, but when is it too late to intervene on a cost-driver? Here are the most common areas where employers can focus to influence spending, care quality, preventative care, and effectiveness of condition management.

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What Is Actionable?

·        The plan’s pharmacy formulary (with some limitations based on the PBM partner).

·        The plan’s rules surrounding specialty medications.

·        The healthcare partners the employer selects (health plan, PBM, condition management services, smoking cessation, behavioral health services, direct primary care, centers of excellence).

·        Plan contributions, deductibles and coinsurance paid by employees for their healthcare benefit, emergency room surcharges, spousal surcharges, smoker surcharges, stop loss arrangements.

·        Cost variation among high cost and/or high volume services (MRIs, musculoskeletal surgeries, cancer care, etc).

·        Effectiveness of member education on health benefits.

·        Targeted wellbeing services offered to members.

Now that we’ve laid out the goals of using data and the areas that are actionable, here are some specific questions to answer when looking at the data.

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Areas of insight.

1.      Which conditions and medications represent the largest population health risks? How do these conditions vary by both dollars spent and number of people affected?

2.      Can amending prescription drug policies surrounding step therapy, specialty drugs, generics, place of service/purchase lead to savings for members?

3.      Does the member base have a problem with emergency room (ER) misuse and are certain locations or member categories driving ER costs?

4.      Do changes in member risk score, medication adherence and prevalent disease states such as diabetes show that your investments in condition management, smoking cessation and wellbeing interventions are working? Could performance guarantee fees be recovered from vendors?

5.      Are there trends noticeable related to members who are not engaging with physicians at all? Through looking at healthcare utilization among work location, salary bands, plan types—can we identify trends as to why certain people are not using necessary health services? These barriers to accessing care could be cost, lack of understanding of benefits, and even corporate culture, among others.

6.      What percentage of people are receiving preventative care and age-appropriate screenings among various member demographics?

7.      What are the largest cost variances that can be actionable? For example, could costs associated with procedures such as joint and hip replacement surgery or even MRIs be standardized via options that are available to your members? (Could centers of excellence be leveraged?)

8.      Could a direct primary care model have benefit for the member population?

9.      Are there actionable insights with respect to absence data and workers compensation claims?

10.  What is the size and scope (in dollars and members) of opioid use and dependency-related costs?

In the same way that reading an abstract is not the same as reading the book, please keep in mind that this is a very brief overview of a complex subject.* Every employer has unique challenges related to population health and health spending, so there's is no real "one size fits all" approach. The data drives the discussion in a unique direction for each employer.

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About BetaXAnalytics:

We combine data science with clinical, pharmacy and wellness expertise to guide employers and providers into a data deep-dive that is more comprehensive than any data platform on the market today. BetaXAnalytics uses the power of their health data "for good” to improve the cost and quality of health care. For more insights on using data to drive healthcare, pharmacy and wellbeing decisions, follow BetaXAnalytics on Twitter @betaxanalytics, Facebook @bxanalytics and LinkedIn at BetaXAnalytics.

* A Note on Data Privacy The purpose of using health analytics is to identify actionable areas to target costs and to improve effectiveness of care options on an aggregate level. This is done by looking at trends in data and under no circumstances should insights be presented to an employer in a way where data is individually identifiable. There are a number of data-related best practices that we recommend to remain adherent to privacy laws. Any employer, broker or consultant who is using health analytics should do so under strict adherence to HIPAA regulations and under the advisement of an experienced data privacy attorney.

Employers Are Using an Innovative Way to Soften the Financial Burden of High Deductible Health Plans

As a healthcare data technology company, the most common question we hear from employers is, “how can we lower our healthcare spending?”  The high cost of healthcare has a significant impact on employer expenses.  The Milliman Medical Index projects that in 2018 the average premium for a family of four is $28,166.  While the magnitude of health costs is a reality for our employer clients, finding an effective way to manage these high costs is often their first priority.

When we drill down into cost-drivers, we consistently see a startling theme across employers—that only 5% of people are driving 51% of healthcare spending.  A very small group of people with chronic conditions (such as diabetes, rheumatoid arthritis, or cancer) are contributing to half of the total health spending.  While this disproportionate spending is a reality within employer populations, according to the Kaiser Family Foundation Medical Expenditure Panel Survey, this also holds true for Americans as a whole.

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As a way to manage the rising cost of healthcare, nearly 40% of adults are covered by what is known as a high-deductible health plan.  Under this model, employees share in a greater share of their health expenses, responsible for on average $5,248 of out of pocket medical costs each year.  The thinking behind this way of cost-sharing with employees is that when employees are responsible for paying a greater share of their health expenses, that they will become better healthcare consumers by shopping for the best prices and avoiding unnecessary procedures. 

Unfortunately, in many of these cases the high out-of-pocket medical costs cause financial hardship on many people.  A survey from the Kaiser Family Health Foundation found that 1/3 of adults have trouble paying their medical bills, and 73% have cut back on spending on food, clothing or basic household items to pay their medical bills. The Report on the Economic Well-Being of U.S. Households, an annual survey conducted by the Federal Reserve Board, found that 44 percent of adult Americans claim they would not have $400 in case of an emergency without turning to credit cards, family and friends, or selling their own possessions. When those who are financially strapped have mounting healthcare bills, the consequences can be personally devastating.  A 2015 poll by the Robert Wood Johnson Foundation and the Harvard T.H. Chan School of Public Health found that 26 percent of those who took part in the survey claimed medical bills caused severe damage to their household’s financial wellbeing.

Because the impact of high healthcare deductibles causes such a financial hardship for individuals and their families, many recent studies have shown that this type of health plan causes individuals to delay necessary healthcare.  Researchers from UC Berkeley and Harvard studied the results of a large employer’s choice to offer a high deductible plan over 2 years. Instead of finding evidence to support the theory that high-deductible plans make people take more charge of their health spending, they found no evidence to show that employees were comparing costs or cutting unnecessary services once they had a high healthcare deductible.  They cut low-value health services at the same rate as they were cutting important medical services, causing the employer to question whether members were making the right choices for their long term health.  Additional studies have found that the danger of high deductible health plans is that their members with the highest health risks have shown that they avoid necessary care and medications due to cost. 

On the other side of the phenomenon that 5% of people drive 51% of health costs, we see another theme that is equally surprising—half of plan members contribute to only 3% of total health spending.  That’s right—a large proportion of costs come from a small number of people, yet a large number of people contribute very little to overall costs.  Why is this? 

At BetaXAnalytics, when we look at employer utilization of health services we consistently find that between 10%-20% of members never see their doctor.  These are the employees who either feel they simply “don’t have time” to see the doctor or “don’t have the money” to spend into their annual deductible.  But it’s within this group of people who are not driving costs today where an employer’s greatest healthcare risks can lie. 

The answer for employers?  Make it as easy as possible for members to get the care they need.  One effective way to ensure that people aren’t avoiding necessary care is to remove the traditional financial and convenience barriers that prevent employees from seeing the doctor.  Hooray Health provides a template for employers to solve this problem. They afford first dollar coverage for preventative, basic and urgent care visits with $0 deductibles, and $25 copays for all in-network visits.  Their innovative network consists of over 2,400 retail clinics and urgent care centers across the country with extended hours and no appointments necessary.  They also provide access to telemedicine visits via phone 24-hours a day, 7 days a week at no cost which makes getting necessary care quick and easy, even when work and family schedules make it difficult to go into a doctor’s office.  Their app-based tools and live medical concierge are available 24/7 make finding care easy and convenient.  As an added benefit to address employee concerns about prescription costs, Hooray Health offers a prescription discount card to ensure employees that they are receiving competitive prices for their medications.

Hooray Health removes financial and convenience barriers that prevent people from getting the care they need by making access to necessary care easy, convenient, and free for employees.  This type of solution is particularly useful for employers with high deductible health plans where high out of pocket costs may deter employees and their families from seeking the necessary care that they need.  While solutions like these remove barriers to care, they also save employers money by providing an affordable alternative to many of the care services needed by their members. Providing easy-to-use concierge-based access to a network of retail clinics, urgent care centers and telemedicine doctors ensures that employee health won’t neglect their health due to lack of money or lack of time.  You can learn more by contacting them at info@hoorayhealthcare.com

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About BetaXAnalytics:

If you're an employer who feels there's got to be a better way to control health care costs, you're on to something. And we can help. BetaXAnalytics partners with employers to use the power of their health data "for good” to improve the cost and quality of their health care. By combining PhD-level expertise with the latest technology, they help employers to become savvy health consumers, to save health dollars and to better target health interventions to keep employees well. For more insights on using data to drive healthcare, pharmacy and wellbeing decisions, follow BetaXAnalytics on Twitter @betaxanalytics, Facebook @bxanalytics and LinkedIn at BetaXAnalytics.

About Hooray Health:

Since its founding in 2017, Hooray Health has been committed to disrupting the health insurance industry by providing employers, individuals and their families with the assurance that their basic healthcare needs are covered. Here at Hooray Health, we believe that healthcare should be simple, honest, and affordable, that’s why whether you apply online or over the phone, the process is always simple, and acceptance is guaranteed. Partnered with over 2,300 urgent care and retail clinics, and a 24/7 medical concierge team, Hooray Health members know that no matter where they are or what time it is, their healthcare is there for them. Starting plans have a low monthly cost with no annual deductible, an affordable copay, and no surprise balance bills. Every day, Hooray Health is smashing the industry norms and bringing healthcare to all.

How Much of Our Healthcare is Waste?

Image credit: iStockPhoto

Image credit: iStockPhoto

It’s no secret that healthcare costs in the United States are skyrocketing, as the latest estimates put our annual healthcare spending at 18% of the U.S. GDP. Furthermore, the health of Americans ranks among the worst compared to health outcomes in similar developed countries. This complex reality is aggravated by a number of problems. Much of the care that we receive is known as “fee-for-service”—we pay for each medical service or test we receive. What this means for patients is that the more they see their doctor, the more they pay. This is problematic for many Americans, as nearly 40% have a high deductible health plan where individuals are responsible for on average $5,248 of out of pocket medical expenses each year. A survey from the Kaiser Family Health Foundation found that 1/3 of adults have trouble paying their medical bills, and 73% have cut back on spending on food, clothing or basic household items to pay their medical bills. With the cost of healthcare in the U.S. being such a recognized problem, one of the many concerns that contributes to this issue is what is known as “low value care,” or in other terms, wasteful healthcare services. 

Choosing Wisely® is an international initiative that promotes facilitating conversations between patients and their doctors about the clinical need for low value care. The goal is to reduce wasteful medical tests and unnecessary health services.  As part of this initiative, over 80 partners have published an extensive list of clinically-vetted recommendations that represent medical best practices. A 2014 study of the Virginia All Payer Claims Database applied a list of these clinical recommendations and found that low cost, high volume health services contribute the most to unnecessary health spending; wasteful spending in this study was estimated at $538 million.

What does spending on wasteful healthcare services look like at an employer level? One of our clients, a large, self-insured employer, was interested in understanding if wasteful health spending was an area of concern for their members. To answer this question, we looked through 3 years of their medical and pharmacy claims to pull out services that were deemed “clinically wasteful.” From this data, we narrowed our focus to 11 specific measures of wasteful services which are based on areas of waste that are clinically validated under both the Choosing Wisely® initiative and HEDIS. These 11 areas are as follows:

  1. Don't do imaging for an uncomplicated headache.
  2. Don't perform PAP smears on women younger than 21.
  3. Don't perform PAP smears on women who had hysterectomy for non-cancer disease.
  4. Don’t perform routine annual PAP tests in women 30–65 years of age.
  5. Don’t diagnose or manage asthma without spirometry.
  6. Members with a primary diagnosis of low back pain should not have an imaging study (plain x-ray, MRI, CT scan) within 28 days (4 weeks) of diagnosis.
  7. Don’t indiscriminately prescribe antibiotics for uncomplicated acute rhinosinusitis.
  8. Don’t order sinus computed tomography (CT) for uncomplicated acute rhinosinusitis.
  9. In the evaluation of simple syncope and normal neurological examination, don't obtain brain imaging studies (CT or MRI).
  10. Don't do CT for evaluation of suspected appendicitis in children until after ultrasound has been considered.
  11. Don't recommend follow-up imaging for clinically inconsequential adnexal cysts.

Out of the entire member population consisting of employees, spouses and children who were covered under the company’s health benefits, there were 2515 members who received care in the 11 categories of care that we studied. Our study found that half (1274) of these people received medical services that are considered clinically wasteful.

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15.5% of spending in these 11 categories was considered to be wasteful. Out of $1.47 million spent on care within these 11 categories, $229k was spent on these clinically wasteful services. 

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There are a few limitations to keep in mind while evaluating these measures of waste. First, we examined 11 out of over 500 clinical best practices. This is because we wanted to focus on data points that were more accurately represented by claims data, as EMR notes were not available as part of this study. What we measured were specific types of waste and we did not calculate the total amount of “healthcare waste” in this employer’s spending. Furthermore, our study examined direct claims-based costs and made no assumptions of additional downstream medical costs for those who received low value care services. 

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What do these findings mean for this company and others who are paying for healthcare? Healthcare waste (low value care) is a reality in our healthcare system today. Patients, providers, and those paying for care are all affected. Even in this study that examined health spending in one company, out of the 11 areas of clinical waste we studied we found that half of the people receiving care in these categories received low value services. Initiatives such as Choosing Wisely® are effective in raising awareness of low value care and opening conversations between patients and their doctors to avoid unnecessary medical tests and treatments. You can find more information on this educational initiative at www.choosingwisely.org

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BetaXAnalytics is a healthcare data consulting firm that helps payers and providers to maximize their CMS reimbursements and helps employers to reduce their healthcare spending through proven strategies to contain costs. For more insights on using data to drive healthcare, pharmacy and wellbeing decisions, follow BetaXAnalytics on Twitter @betaxanalytics, Facebook @bxanalytics and LinkedIn at BetaXAnalytics.

The Future of Healthcare is 3 Letters: CVS

There’s a lot of speculation surrounding CVS’s acquisition of Aetna that’s planned for 2018. But one thing we know for certain is that CVS’s direction in 2018 will make an enormous imprint on healthcare in the U.S. as we know it. 

On December 3, CVS announced their agreement to acquire Aetna, the nation’s 3rd largest insurer, for $69 billion. To put the sheer magnitude of a deal like this into perspective, this deal would be the largest in the history of health insurance. CVS is currently a Fortune #7 company with an annual revenue of $177.5B; Aetna is #43 on Fortune’s list with an annual revenue of $63B. According to the current Fortune 500 list, the merged CVS/Aetna would have the 2nd highest annual revenue, second only to Wal-Mart. 

CVS has expressed the desire for this acquisition to improve the integration of patient care, and to provide higher quality care at a lower cost in "communities, homes and through the use of digital tools to support health." CVS's President and CEO Larry Merlo communicated the desire to put customers "at the center of health care delivery." The intent would be to leverage CVS's 9,700+ retail stores and 1,100 Minute Clinics to create community-based centers that include resources for wellness, medical, pharmacy, vision, hearing and nutrition services. And the touted benefit of acquiring Aetna is that integrated care and higher negotiation power for pharmaceutical drugs is the key to lowering costs. 

This deal is projected to happen in the second half of 2018. At this point, it is unknown whether the acquisition will face anti-trust opposition. While vertical mergers (which combine 2 companies which are not direct competitors) don't traditionally get blamed for stifling competition, CVS's announcement comes on the heels of the Justice Department's block of AT&T's takeover of Time Warner, citing the acquisition would create "too powerful of a content company." And with 2 recent horizontal healthcare deals halted for antitrust reasons (Aetna/Humana and Anthem/Cigna), CVS's Aetna deal will need to pass through close scrutiny in Washington before the deal can be finalized.  In October, Trump declared  “My administration will…continue to focus on promoting competition in healthcare markets and limiting excessive consolidation throughout the healthcare system,” though many are betting that this vertical deal will go through with only the requirement of some concessions by CVS and Aetna. 

My predictions for 2018? One of two things will happen.

Possibility #1: Regulators block CVS’s Aetna acquisition

What is to stop regulators from saying that this deal will create “too powerful of a healthcare company?” This is indeed a possibility, albeit one that many think is unlikely. But in this past year alone, the Federal Trade Commission blocked Walgreens’ purchase of Rite Aid, while the Justice Department intervened to prevent Aetna’s acquisition of Humana and the Anthem/Cigna merger. While these were considered horizontal deals among competitors, the Department of Justice blocked these deals because they would drastically restrict competition and “fundamentally reshape the insurance industry.” Would the CVS/Aetna deal not also do the same thing?

If this acquisition is blocked, it signifies that the regulatory tide could be changing with respect to how the largest players in healthcare can evolve. With the “big five” insurers, which cover approximately 90% of all commercially insured Americans, unable to strategically gain market share through jumbo mergers and acquisitions, this opens up the door for new entrants into healthcare markets who are better at solving healthcare’s problems than their behemoth counterparts. It also encourages existing competitors to home-grow solutions in their organizations rather than joining forces with outside partners.

Possibility #2: CVS’s Aetna acquisition moves forward in 2018

Let’s imagine for a moment that the deal does go through as planned.  The likely next step is that Express Scripts, the only other big PBM not owned by an insurer, will merge with a health insurer like Humana, and may even buy its own pharmacy chain such as Walgreens. This trend would change the landscape of healthcare, giving all power to a few vertically integrated giants, and putting any smaller PBMs or insurance companies at a crippling competitive disadvantage.  

CVS's vision of transforming local retail stores into community health centers where people can not only pick up prescriptions, but also see a doctor, talk to a nutritionist, or receive vision care is a compelling evolution of the way we seek self-care. This type of model could be the answer to the convenience that people want with telemedicine, but it breaks down the barriers to full adoption by putting a community-based centralization on the care they receive.

As we consider these two possibilities, we should ask some big questions. 

  1. Do companies become more innovative when they get bigger?
  2. Do competitive moves like this help to fight the steadily rising costs of healthcare?
  3. Will this improve the quality of care that people receive?

Whether 2018 is the year that the CVS/Aetna merger moves forward, or whether 2018 is the year that the CVS/Aetna deal is blocked, either way will lead to a crossroad that will signify the next evolution for healthcare in America. The promise of the benefits to consumers—transforming retail stores into hubs for health services and potentially better prices as a trickle-down benefit from improved negotiation power with pharmaceutical manufacturers—paint a compelling picture for what the future of American healthcare could be. Only time will tell whether consumers will be the winner in this deal, whether the winner will be the shareholders, or whether we’ll never get to find out.

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BetaXAnalytics is a healthcare data consulting firm that helps payers and providers to maximize their CMS reimbursements and helps employers to reduce their healthcare spending through proven strategies to contain costs. For more insights on using data to drive healthcare, pharmacy and wellbeing decisions, follow BetaXAnalytics on Twitter @betaxanalytics, Facebook @bxanalytics and LinkedIn at BetaXAnalytics.

If you want to learn more about solving healthcare’s challenges, you may also like:

Dear Employer: High Deductible Health Plans Are Making People Sick

4 Strategies to Save on Employer-Sponsored Healthcare

My Talk for TEDxProvidence

Blockchain Is Like the Internet of 1992

Blockchain: it's just the beginning for healthcare, and we can barely describe what is yet to come.

Blockchain: it's just the beginning for healthcare, and we can barely describe what is yet to come.

If you’re in the banking or healthcare industry, you’ve likely heard the term “blockchain.” On the surface, this technology behind the exchange of bitcoin may not be taken seriously because some think that bitcoin, now valued at $41 billion, is a passing fad. But as the framework that makes bitcoin exchange possible, blockchain provides an innovative level of security that allows anonymous people who do not know each other to exchange money, without the traditional safety net (or fees) of a bank acting as a middle-man to authenticate funds transfers. And since this solution has opened up so many possibilities within the financial sector, many other industries are preparing for how blockchain can fundamentally change the way we all do business.

Imagine it’s 1992. Think back to what the internet was to you at that time. During this year, the first readily-accessible browser of the “World Wide Web” was launched. At the time, how would you have explained to people what the internet was? 

In 1992, the internet was described as "a wide-area hypermedia information retrieval initiative aiming to give universal access to a large universe of documents.”

HUH? Sure, this description is technically true, but in 1992 this didn’t even begin to scratch the surface of what how the internet would fundamentally change daily life for us all in 2017. In the ‘90s while we would wait 15 minutes to dial-up to the World Wide Web or wait 10 minutes for a picture to download, it would have been hard to imagine a day when we would do most of our banking, shopping, reading and communicating online.

Today is not so different from 1992, because we still have the same difficulties describing new technology and envisioning how it can change our lives as we know it. In the context of bitcoin exchange, blockchain creates an encrypted peer-to-peer network where every single bitcoin transaction is recorded and validated throughout the entire network. This is different from our traditional model of transferring money from one account to another, where we rely on a bank (a central location) to verify that originating funds are available, to guarantee the safety of the funds while they are in transit, and to ensure that these funds reach the destination account as intended. Today, banks act as intermediaries for financial transactions, which allows us to trust in the safety and security of our money as we transfer funds. 

Blockchain is a solution that also allows us to trust in the exchange of money, only the process works differently. The blockchain is referred to as a “ledger,” a series of records of validated monetary transactions, where the identical updated ledger resides throughout the peer network, not in one central location as under the traditional banking model. The system of blockchain is characterized by a few unique attributes that make this solution uniquely secure and positioned to transform many types of traditional business transactions:

  • Distributed: This describes the fact that the ledger exists throughout the blockchain network, and is not maintained in one central location. 
  • Smart Contracts: We can think of this as an automated execution of a legal contract that governs the rules of each financial transaction.
  • Consensus: In order for each transaction in blockchain to take place, “consensus” prevents fraudulent transactions by ensuring the validity of each transaction and agreement between parties of the transaction.
  • Immutability: The record of a transaction in blockchain lives forever and it cannot be erased. The benefit of the inability to erase a transaction is that one single asset can be tracked throughout its entire life. In this sense, if a bitcoin were a dollar bill, the blockchain would track where and when the dollar was printed, who the first owner of that dollar was, and it would record every single date and exchange of hands along the blockchain, and none of these transactions could ever be erased.

Today, blockchain is a solution looking for problems to solve. The healthcare industry has high hopes for blockchain technology since interoperability, or the ability to securely share medical records across providers and patients, is the driving force behind many technology investments within healthcare. It’s widely believed that blockchain will be the technology that will form the basis of securely creating and sharing medical records that will solve many of healthcare’s current issues of siloed stores of data that lead to the delays and administrative burden of sharing health information. Designing an overlay of blockchain throughout the healthcare system reimagines a world without duplicate paperwork, inefficient payment systems, and delays in sending health records from provider to hospital, and these improved processes could all take place with a superior level of security.

Just as the internet was to 1992, so is blockchain to 2017.  We're just getting started, and we can barely describe what is to come. This technology is indeed already transforming some industries, but in relation to identifying new ways it can enhance transaction security, prevent fraud, remove “middle man” fees, automate legal agreements, and increase the speed of information-sharing, we have yet to scratch the surface. 

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If you are interested in exploring what blockchain means to the future of healthcare, banking, government and cyber-security, join us on November 29th at Salve Regina University in Newport, Rhode Island for Blockchain, Bitcoin and Crypto-Currencies - Is Your Organization Ready? organized by the Rhode Island Israel Collaborative.  

Also for more information on blockchain and bitcoin, we recommend this succinct explainer video: Bitcoin Made Simple 

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BetaXAnalytics is a healthcare consulting firm that helps payers and providers to maximize their CMS reimbursements and helps employers to reduce their healthcare spending through proven strategies to contain costs. For more insights on using data to drive healthcare, pharmacy and wellbeing decisions, follow BetaXAnalytics on Twitter @betaxanalytics, Facebook @bxanalytics and LinkedIn at BetaXAnalytics.

If you want to learn more about solving healthcare’s challenges, you may also like:

My Talk for TEDxProvidence

Dear Employer: High Deductible Health Plans Are Making People Sick

2 Reasons Why Your Data Is Lying To You

Dear Employer--High Deductible Health Plans Are Making People Sick

What has become a standard practice for employers to control their healthcare spending could backfire…big time

What has become a standard practice for employers to control their healthcare spending could backfire…big time

We get it. Healthcare is expensive and costs are going up every year.  Medication costs are skyrocketing. For some chronic conditions, a year of treatment with a specialty drug can exceed $100,000. American companies are shouldering the burden of a healthcare system where ½ of what we spend in healthcare is considered “wasteful”.  Healthcare is now the 2nd highest business expense for most companies, second only to salaries. And because most employers pay their health claims at dollar 1, regardless of what their business does, by default all companies end up in the business of healthcare. And something’s gotta give.

Why do employers bear the burden of the inefficiency of the US healthcare system? In US healthcare we spend twice as much per capita with health outcomes that rank among the worst in the world. So the growing trend for employers to deal with crippling health care costs is to find others to share in this cost. Why not hold employees more accountable? After all, employees’ personal health choices and behavior make up37% of health costs. Employers tell their employees “let’s solve this together. We will support you.”

So very well-meaning companies offer “high deductible health plans” to employees. On the surface, it’s a win-win. The thought behind these plans is that if employees have to contribute more to their healthcare costs, they will take more responsibility for their health. In theory, employees will take better care of themselves so they can stay healthy. They will avoid unnecessary medical procedures, since they are responsible for paying for costs under their deductible. Employees will start to compare costs of medications and procedures to make sure they’re keeping their health expenses as low as possible. And so with average out-of-pocket costs for individual employees at $5,248, the rationale is that overall health costs for both the employer and the employee will go down since employees start to understand the value of their health, and they become smarter consumers of health care.

From an employer perspective, this sounds like a brilliant plan to control costs. But does this idea to transform Americans into savvy health consumers actually happen once a company starts expecting employees to pay a higher share of health costs?

Nope. 

As we track the results, there is evidence that raising employees’ out-of-pocket costs for healthcare does NOT increase consumerism, and it also has led to people not taking necessary medications and delaying care for chronic conditions, which leads to more serious health events (and costs) later on down the road.

Employers save money in the short term…but at what cost?

Researchers from UC Berkeley and Harvard studied the results of a large employer’s choice to offer a high deductible plan over 2 years. But instead of finding evidence to support the theory that high-deductible plans make people take more charge of their health spending, they found some surprising trends. Yes, employees spent 12% less on their healthcare, so in the short term these plans achieved their goal of lowering health costs. But these “savings” were from avoiding care of EVERY type. There was no evidence to show that employees were comparing costs or cutting unnecessary services once they had a high healthcare deductible. They went to the same doctors. And they cut low-value health services at the same rate as they were cutting important medical services, causing the employer to question whether members were making the right choices for their long term health.

Yes, But What if Preventative Services are Free?

The common response from employers with high deductible plans is to make sure necessary and preventative health services come at little to no cost to employees. But a recent study from California found that despite these efforts, 1 in 5 people still avoided preventative care citing cost as the reason. In fact, most high deductible health plan members surveyed did not know that their preventative screenings and important care was available with little or no out-of-pocket payments.  Additional studies show that high deductible health plans have the most adverse impact on those with chronic conditions, people with mental health disorders, and low-income individuals and families.  The danger of high deductible health plans is that their members with the highest health risks have shown that they avoid necessary care and medications. And this trend is one of many symptoms of the crippling cost of healthcare in America. 

Employers: we know you did not ask for the job of footing $640 billion of our healthcare bill in the U.S. It’s ridiculous, we know. But we just want to make sure you know high deductible health plans are a band-aid—not a solution. 

Signed, Hardworking Americans

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If you're an employer who feels there's got to be a better way to control health care costs, you're on to something. And we can help. BetaXAnalytics partners with employers to use the power of their health data "for good” to improve the cost and quality of their health care. By combining PhD-level expertise with the latest technology, they help employers to become savvy health consumers, to save health dollars and to better target health interventions to keep employees well. For more insights on using data to drive healthcare, pharmacy and wellbeing decisions, follow Follow BetaXAnalytics on Twitter @betaxanalytics, Facebook @bxanalytics and LinkedIn at BetaXAnalytics.

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Photo credit: iStockPhoto by Getty Images

Photo credit: iStockPhoto by Getty Images

We’re living in funny times when there’s a public outcry for open accessibility to affordable healthcare, yet employers still cover over half of the non-elderly population in the U.S.  So this leaves employers, very few of which have in-depth knowledge of how to keep people healthy, footing a large bill and assuming the health risk of their employees.  In fact, 82% of employers with over 500 employees are considered “self-insured,” meaning that they pay dollar for dollar the claims of their employees, spouses and dependents.  For most of these employers, healthcare is their second largest expense, second only to the cost of salaries. 

So this leaves any smart employer with a very reasonable expectation—they want to keep their employees healthy.  After all, they’re footing the bill for healthcare, so they have a vested interest in the health of their employees and their families.   But how do you keep people healthy?  Do you go home with them to make sure they don’t devour a package of oreos at night?  Or call them to remind people to take their blood pressure medication?  Or wake them up early to make sure they hit the gym before work?

Of course these interventions sound crazy.  People’s health habits are a product of personal choices that are decades in the making…and changing these habits is a tall task.  So employers are left to manage all sorts of 3rd parties to handle just this—to administer health services, to provide resources for health coaching, to inspire employees to be physically active, and to provide behavioral health and addiction services.  But the basic problem remains…employers are paying for these services, so how can they know they are getting what they pay for?  This is one of the reasons why health analytics is so important.

Here are the top reasons why employers need to use health analytics:

1.       To understand employee health needs.  Most employers, in addition to offering health insurance to employees, offer services to address employee health needs.  The goal of offering health services is to improve employee health and to lower health costs over time.  These services could be health coaching, health seminars, fitness challenges and weight loss programs.  And with the average employer spending $693 per employee on wellness incentives, they want to make sure they understand which services are needed most by their employees.  This helps them to spend wisely.  This moves them from the spaghetti method of health and wellness spending—throwing everything to the wall to see what “sticks,”—to a data-driven health and wellness strategy that can be justified and measured for their senior management. 

2.       To give high-risk employees the health resources they need.  What if you were able to know someone was going to have a heart attack before it happened?  The amount of data available today can be used for a very good purpose—to help to match people with proactive care before they end up in a hospital.  Let’s say you use an outside service to provide health condition management for your members.  The only way condition management can be valuable is if it is reaching the right employees.  Leveraging health analytics of your members can ensure that the right members are receiving proactive condition management outreach at the right time—before they end up in the hospital.

3.       To find wasteful spending.  Most employers today are under increased internal scrutiny to ensure that they are doing their due diligence in managing their vendors, and the total health and wellness services costs for employers significant.  Annual premiums for employer-sponsored family health coverage is $18,142, according to a 2016 employer survey from Kaiser Family Foundation.  One very common source of “waste” is the misuse of the emergency room (ER).  Understanding the magnitude of emergency room misuse and patterns in the reasons for costly ER visits helps to inform how to best communicate existing benefits to employees, communicate alternatives to the emergency room as well as to evaluate changes to ER co-pays to encourage employees to seek alternative forms of urgent care when it makes sense.

4.       To manage prescription costs.  A 2016 study by Castlight Health found that 1 out of every 3 opioid prescriptions covered by employers is abused, and that painkiller abusers cost employers nearly twice as much ($19,450) in medical expenses on average annually as non-abusers.  Rising opioid usage and skyrocketing specialty medication costs are at the top of mind for employers, but most employers get very little transparency into this information.  Examining prescription drug data helps employers to better understand medication usage, adherence and addiction among their members.  This provides valuable information that is crucial to help them to save money in the future, make needed changes to their pharmacy plans and to provide appropriate behavioral health and addiction resources to members.

5.       To manage health service vendors.  It is becoming more common for wellness service contracts to include performance guarantees, meaning your company could be getting money back, sometimes up to 30% in returned fees, if employee health is not improving as promised.  If your company has performance guarantees in your vendor contracts, you’ll want the ability to have your own source of truth on whether those guarantees are being met.  Have you ever had a question that was met with 3 different answers from 3 different vendors?  This is comparable to doing your taxes – you may take your tax documents to 3 different accountants and come up with 3 different numbers on your return. Every vendor is looking at data through a different lens, and some lenses are more accurate than others.  It’s ironic that employers foot the bill for employee health, yet they rarely have the ability to have their own data arsenal to inform their decisions and audit vendors.  Analytics helps employers to become more savvy “consumers” of health services. 

Bottom line – when you are spending a lot of money on something, you deserve to know if that money is being well-spent and you deserve to know how you might be able to save money in the future.  This is the value to employers of making data-driven decisions on their healthcare spending.  And if you have the opportunity to receive this data from an impartial 3rd party whose contract is not “on the line” based on the data they provide (i.e. not the health plan, not the wellness service provider), an employer is in a prime position to best manage these services.

 

About BetaXAnalytics:

BetaXAnalytics uses “data for good” to improve the cost and quality of health care for employers.  By combining PhD-level expertise with the latest technology, they help employers to become savvy health consumers, saving health dollars and better targeting health interventions to keep employees well.

Follow BetaXAnalytics on Twitter @betaxanalytics, Facebook @bxanalytics and LinkedIn at BetaXAnalytics.