Putting Patients First: How Data is Helping Payers Revolutionize Healthcare

It may seem like change in the healthcare industry is never-ending, but we’re on the cusp of a revolution that’s made possible by data. Payers are leveraging the petabytes of data generated by hospitals, clinics, labs and the Internet of Things to transform the entire healthcare industry. Data sharing is the common thread running through every interaction between patients, providers and payers, uniting them in a value-based approach that has potential to lower healthcare costs, improve healthcare quality and outcomes, and create a more patient-centered care experience.

The Changing Role of Data in Healthcare

Becoming data-driven isn’t big news in healthcare. The term has been around since the 1970s when ACNielsen created the first Data Marts for marketing analytics. It has steadily grown in importance with the Big Data boom in the 2000s and now seen as the number one enabler to faster, better decision making. Drug companies and healthcare providers rely on clinical data to track and improve outcomes while payers, mainly insurance companies, have traditionally used data to improve actuarial analysis and perform risk mitigation.

Today, the role of data in modern healthcare goes well beyond the financial, and well beyond payers just paying drug and services claims. The individuals receiving or providing care for a family member want the same transparency, ease of choice, and digital control over their healthcare services they have in all other aspects of modern life.

  • Patients: Payers have realized patients are people first - people that could be anywhere on the care continuum from not engaged to proactively maintaining good health to palliative. In most cases, people are increasingly aware of the data around their health and are more comfortable shopping for services. With access to data along the healthcare continuum, patients are able to compare provider fees and quality. By understanding the costs of healthcare and options, they’re able to make more informed decisions to better manage their health, their care and their finances.

  • Caregivers: Here again, forward-thinking payers are changing their definition. Caregivers are recognized as family, friends and even service workers who are under the pressure of not only caring for their own personal health, but that of another. In many cases, a loved one. With insurance costs for a family of four now averaging over $25,000 a year they need the payer industry to guide them to best care at best cost options, and not act as a bureaucratic roadblock to that loved one’s well-being.

  • Providers: With access to more data about their patients as well as patterns in care plans, costs of treatment, and outcomes for patients with similar health issues, they can make more informed and efficient care decisions. They are also armed with more information to advise their patients.

  • Employers: A majority of individuals receive insurance coverage from their employer or from the government (CMS). What most individuals don’t realize is that many of these plans are self-funded, which means the employer sets the insurance policy terms. The insurance company’s role is to make sure those policies are legal and properly managed. It’s the how in that management progressive insurers are changing. Employers recognize that approximately 7.5% of overall compensation costs go to healthcare. These costs are rising at approximately 6% annually, more than double the estimated rate of inflation. Strategic employers choose payers which make sure that health plan management includes keeping their labor force healthy and working at the best possible value.

  • The Uninsured: This is the wild card. Even with the Affordable Care Act, there are still segments of the population uninsured. In fact, according to the Commonwealth Fund the rate is rising. Insurance companies are discovering what hospitals have known for a long time: Due to the cost of healthcare, uninsured people typically do not seek preventative health treatment. When healthcare is needed, it’s often for a major issue, and expensive to the point that the uninsured individual can’t afford to pay the bill. Not only does this cause personal financial hardship, in many cases to the point of bankruptcy, the losses to the health service providers result in larger overall service costs for all. For more detail, see the Kaiser Family Foundation report on the uninsured.

Sharing Leads to Better Outcomes

Payers understand that data sharing is the key to driving changes in behavior by putting data and actionable insights into people’s hands.

The healthcare industry still does not share data well. Though modern technology makes it feasible, leadership in some organizations is still reluctant to share due to concerns about data security, patient privacy, and fear of giving up a competitive edge. Without data sharing though, no one can see the full picture of a patient’s healthcare journey. Outcomes for everyone improve when providers, patients and payers all have a clearer understanding of the factors that go into an effective treatment program.

Take, for example, a child with severe asthma. His parent’s health insurance covers the cost of two inhalers per month, one primary and one emergency. Often, two is not enough. Mom and Dad need to have one on hand during trips or an extra at school. Without the extra inhalers, the child often ends up in the emergency room or an after hours clinic. With data sharing and analytics, payers can see this pattern and take steps to approve more inhalers. As a result, the child feels better, and the family’s stress is eased. When the payer and provider work together to proactively and holistically provide healthcare services, the cost to the payer and the parents, in this case for additional inhalers, is much less than the cost of the ER visits.

From Silos to Partnerships

Payers have often been considered “the bad guy” in the traditional healthcare system. They are seen as the controllers who may keep you from getting or affording the care your provider wants to give. With more access to outcomes data, combined with a shift in thinking about individuals as consumers of healthcare services and providers as partners in a patient-centric experience, payers can transform themselves into value-based care advisors.

For all of this to work, the artificial silos around data collaboration have to come down. Investments must be made in more effective sharing between all parties in the care continuum. Simply put, data in modern healthcare comes down to something we all learned in kindergarten: Sharing is good.