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The Case for a Comprehensive
Cross-Payer Health Database
Mac McCarthy, FSA, FCA, MAAA
Middle Atlantic Actuarial Club
September 13, 2013
Speakers
Mac McCarthy,
Tom Persichetti,
FSA, FCA, MAAA
ASA, FCA, MAAA
McCarthy Actuarial
Consulting
Persichetti & Associates
[email protected]
804-651-5293
[email protected]
202-321-5426
www.McCarthyActuarial.com
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Agenda
• Current State of Healthcare Claim Data
• Affected Parties’ Issues
– Buyers
– Payers
– Researchers & Policymakers
– Providers
•
•
•
•
•
Consequences
Why Consolidated, Shared Data Makes Sense
Potential / Emerging Solutions
Impediments & Concerns
Audience Q&A
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Current State of Healthcare Claim Data
• Each payer has proprietary database
– Payers include government programs,
insurance companies (including HMOs),
and employers
• State all-payer databases
• Data warehouse services
• No central repository
– Little or no information sharing
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3
Buyers’ Issues
• Buyers =
– Individuals / Consumers / Patients
– Employers
• Inability to ascertain providers’ and
competing treatments’ value
• Information overload & credibility deficits
• Frustration due to:
– Poor communication between care providers
– Inconsistent billing and benefit statements
– Lack of accountability
• Distrust is widespread
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Payers’ Problems
• Payers =
– Insurers
– Employers
– Governments
• Projecting future costs
• Fraud and waste
• Assuring value for
clients/employees/constituents
• Managing financial risk
www.McCarthyActuarial.com
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Policymakers’ & Researchers’ Needs
• Credible data on alternative treatments for
specific conditions
– Prevalence, effectiveness & costs
– Stratified by population characteristics
– Considering comorbidities
• Reliable information on the impact of:
– Plan design
– Alternative payment strategies
– Wellness & disease management programs
– Provider consolidation & density
• Quantification of fraud, abuse and waste in
the healthcare industry
www.McCarthyActuarial.com
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Providers’ Concerns
• Inappropriate / unmanageable risk
assumption
• Demand anticipation
• Revenue protection
• Reputation
• Control
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Consequences
• FBI estimate for 2009 fraud1: 3% - 10% of
total health spending ($75–$250
billion)
– Recoveries in 2012? Only $4.2 billion2
• Truven Payment Integrity Analysis3:
– Annual fraud and abuse = $125 – 175 billion
– Lack of care coordination = $25 - $50 billion
– Provider inefficiency and errors = $75 - $100
billion
1: Health Affairs, 28, no.5 (2009):
Combating Fraud In Health Care: An Essential Component Of Any Cost Containment Strategy
2: HHS/DOJ Healthcare Fraud and Abuse Control Program, FY2012
3: Truven Health Analytics: Payment Integrity Analysis, April 2013
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Consequences
• Time for recommended evidence-based
practice to be fully implemented4:
9 years
• National Health Expenditures increase,
relative to GDP growth, 2000 - 2011:
Double
4: Commonwealth Fund: Blueprint for the Dissemination of Evidence-Based Practices in Health Care
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Consolidated, Shared Data Makes Sense
• Fraud payment avoidance
• Consumer Driven Health Plans
• Shared risk models
– ACOs, PCMHs, Bundled Payments
• Efficient capital investments and provider
workforce development
• Comparative effectiveness studies
• Enhanced disease tracking for early
identification of emerging epidemics and
localized “hotspots”
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Potential / Emerging Solutions
• Verisk Health
– Pooled-Data Alliance between health
insurers
– “For the first time, healthcare payers will be
afforded the same comprehensive view of
suspect providers and schemes that has
proved so successful for the
property/casualty industry.”
– Applies fraud detection tools developed in
the property & casualty insurance markets,
adapted to the healthcare environment
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Potential / Emerging Solutions
• HealthcarePays
– Member-owned “industry utility”
• Membership is open to healthcare payers and providers
– “The HealthcarePays network connects employers,
payers, providers, banks, key government agencies
and waste and fraud systems to provide a level of
transparency that enables unparalleled waste and
fraud detection.”
– Mirrors fraud avoidance techniques used by credit
card industry
– Cross-payer / cross-provider claims data will be
available to members , subject to member defined
governance and applicable privacy regulations
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Impediments & Concerns Dialogue
No one
understands
me
What do
you mean?
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You have
Questions
We have
Answers
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