Claims Analytics

All This Talk About Actionable Intelligence

The data we collect is more powerful than ever before, but we still need to learn how to leverage it into information that can be acted upon.
By: | April 8, 2015

Everyone in our industry these days agrees that using data more effectively can assist us to obtain better claim outcomes.  When speaking recently with one of our industry veterans, David Smith, divisional VP and risk manager from Family Dollar, he told me, “These days it is all about the analytics.”

Steve Pratt, workers’ compensation director for Berkley Southeast Claims, a subsidiary of WR Berkley, also commented recently, “Analytics are critical to showing progress in a WC claims program. Optimal outcomes can be defined in a number of ways. I believe that outcome metrics need to be focused on how to reduce the claim life, how to help injured workers stay at work and how we can support a healthier injured worker population.”

But how do we transform these desires for relevant analytics into actionable intelligence? In other words: What data do we need? When is it most useful?

How can I integrate the vast stores of data I have in my claims system with all the data I get from bill review, utilization review, case management, pharmacy management, physical medicine management, DME & HHC management etc.?

As I looked back at an article I wrote in 2006, “Pushing a Revolutionary Agenda,” where I first discussed the idea that integrating medical and claim data could help you answer questions you might have about your claim outcomes, I quickly realized that we now have so much more data coming at us, knowing how and when to integrate the data could really be overwhelming.

Here it is, almost 10 years later, and although our technology and the data collected therein is greatly improved and much more powerful, we still need to learn how to leverage the data into “actionable intelligence.”

A few definitions of “actionable intelligence” will help us understand what I mean:

  • Actionable intelligence is information that can be acted upon, with the further implication that actions should be taken.
  • The key to using actionable intelligence is discovering elements within it that a business can exploit to enhance performance.
  • Actionable information is data you can look at and make process improvements based on what you are seeing.

In addition to being accurate, timely, comprehensive and predictive it needs to be analytical to stimulate the exploratory thinking and provide context to ensure strategic alignment and direction.

Let’s assume the action you want to take is to increase the value of your medical management services, i.e. reduce the medical, indemnity and expense spend through improvements in those services. I am certain you already receive some outcome reports from your medical management vendors, e.g. network penetration and savings from bill review and each of your network partners, number of approvals, negotiations and denials from your Utilization Review vendor, “savings” from case management and your pharmacy benefit manager, etc.

“Analytics are critical to showing progress in a WC claims program. …  I believe that outcome metrics need to be focused on how to reduce the claim life, how to help injured workers stay at work and how we can support a healthier injured worker population.” — Steve Pratt, workers’ compensation director for Berkley Southeast Claims

Yet, these reports do not really tell you if there is more that you or your partners could be doing, i.e. what actions you or your partners should be taking in order to achieve improvements in performance.

For example, you know that you were able to direct 65 percent of charges into your PT network, (which is good for the network given how they create revenue), but is it good for you? For example, does that piece of “data” (65 percent charge penetration) enable you to take action that improves claim performance or outcomes? I suppose you could take actions that drove more charges into the network; however, does charge penetration tell you if the outcomes of the claims that were in the network were better than those that were out of network? Do you have the “best” PT providers in your network?

You may have other questions such as:

  • Which doctors continuously treat within the treatment guidelines and have better outcomes (return to full functionality, lower overall claim cost or disability duration)?
  • Are my overall PPO outcomes better than my out-of-network outcomes?
  • Is my utilization review focused on those procedures that cost me the most in each jurisdiction?
  • Which medical procedures should I send to UR, i.e. are you spending resources/money on UR of procedures that are approved most of the time?
  • Which of my claims are potential “creeping catastrophics”? How can I identify them earlier?
  • Are adjusters overriding recommendations from your medical cost containment vendors negating the savings you might have had?

Your medical cost containment vendors can answer some of these questions using just their data and some analytical skills. However, as Ann Schnure, Macy’s VP, risk management, discovered, “true actionable intelligence requires integration of the vendor data (bill review encounter data, pharmacy date, case management data) with claim data.”

Macy’s has been able to leverage this integrated data to identify the medical providers who have had the best outcomes for Macy’s employees and, as Ann noted, “we are now narrowing our networks state by state to eliminate the providers who do not meet our best provider guidelines.”

This integration process also enabled Macy’s to identify the common triggers amongst their longer-term cases and build alerts early on in the claim to keep these claims from becoming the next $500K claim. Macy’s experience points out that our cost containment partners and we need to go through a “paradigm shift” and possibly a “resource shift” to identify and integrate the appropriate data.  We have to look at our data through a new lens, the actionable intelligence lens.

Vendor partners need to be told that delivering raw data is no longer good enough. They must take the time to work with us to integrate their data with claim data that can turn that data into information and actionable intelligence that can, in turn, cause actions that truly enhance performance and outcomes.

We need to be open to and capable of exporting claim data or importing all the vendor data so we can finally understand the “real” impact vendors are having on overall claim outcomes, what they and we can do to laser focus our resources and dollars on those areas where we are experiencing the most “pain.”

So develop your list of “real” questions for which you need actionable intelligence. Let’s stop accepting reports that tell us what our vendors want us to hear and demand actionable intelligence!

After all, as David Smith from Family Dollar said, “It’s all about the analytics.”

Maddy Bowling is a principal in Maddy Bowling Consulting, Inc., a WC consulting firm. Bowling has 35 years of broad-based executive management experience within operating, corporate and consulting environments. She can be reached at [email protected].