7. Analytic & Vendor Mgmt - Health Flashcards

Question

Explain this key consideration for success when a hc org is implementing an analytics initiative: “Security”

Answer 1

Privacy & security of patient data is paramount

Answer 2

A robust extract, transform, and load process - how analytics tech extracts data from source systems, applies the required transformations, and writes data into the target database - is fundamental to the success of the chosen solution

Answer 3

Plan sponsors will need to generate metrics about who is using the system, how are they using it, and how well the system operates. Can the vendor’s solution track basic data about the environment, such as user access patterns, query response times, data access patterns, volumes of data, and data objects?

Answer 4

Viable and sustainable hardware & software vendors continue to change rapidly, esp with cloud-based products & svcs.

Answer 5

Tech is only part of the equation in creating a successful analytics program. A vendor’s solution must also include processes and real-world experience for helping the plan sponsor manage sustainable change in its analytics-driven org.

Answer 6

1. Enterprise Data Warehouse: Collecting and integrating the core data content 2. Standardized Vocabulary & Patient Registries: Relating and organizing the core data content 3. Automated Internal Reporting: Efficient, consistent production of reports & widespread availability in the org 4. Automated External Reporting: Efficient, consistent production of reports and adaptability to changing reqs 5. Waste and Care Variability Reduction: Reducing variability in care processes & focusing on internal optimization & waste reduction 6. Population Health Mgmt & Suggestive Analytics: Tailoring patient care based upon pop’n metrics. Fee-for-quality includes bundled per case payment 7. Clinical Risk Intervention & Predictive Analytics: Org processes for intervention are supported with predictive risk models. Fee-for-quality includes fixed per-capita payment. 8. Personalized Medicine & Prescriptive Analytics: Tailoring patient care based on pop’n outcomes & genetic data. Fee-for-quality rewards health maintenance.

Answer 7

In a self-funded arrangement, the plan sponsor assumes the liability and risk associated with uncertain healthcare costs, but self-funded plans offer opportunities to lower costs & increase flexibility in plan design. Self-funding ca give org tax benefits, better cash flow, and reduced admin costs.

Answer 8

Most carriers and TPAs do a good job of administering self-funded plans, but maintaining regular oversight of hc expenses is prudent and, in fact, a plan sponsor’s fiduciary responsibility. According to ERISA, it is the duty of plan trustees and other fiduciaries to act in the best interests of plan participants, including reducing claims expenses and ensuring the quality of administrative processes.

Answer 9

In the case of fully insured plans, most carriers will offer only a limited number of “standard” plan designs. But with a self-funded plan, sponsor has greater flexibility in design and admin. Bc the number of plan designs for a self-funded ASO client is potentially unlimited, complexity increases for carrier/TPA and creates potential for more admin mistakes.

Answer 10

A retrospective look at claims the carrier or TPA has paid, in order to identify possible processing errors, over- and under-payments. Such audits are conducted by accountants, independent hc cost-containment firms, and EE benefits consultants. Some large plans may have their own internal auditing departments.

Answer 11

1-3% of the total amount spent on claims annually is potentially over/incorrectly paid.

Answer 12

Most agreements allow for only a 12- to 24-mo look back from the date the audit begins. While the ASO agrmt might allow for up to 24mos, the provider network contracts in place will usually allow for only 12mo when it comes to recovering claims that were identified as overpaid. A clear understanding of this difference in timeframes will help set the right expectations about how much $ can actually be recovered.

Answer 13

Almost no carrier/TPA will allow a full audit of 100% of the claims that were adjudicated during the allowed 12- to 24mo timeframe. Most auditors will apply a filtering process to the entire data file, in order to flag claims that show signs of having been paid incorrectly/over-/underpaid. From the filtered subset, the claims can then be chosen for the sample that would be a representative cross-section of the entire claim file. If certain kinds of errors are found, this might indicate a systemic error, and the carrier/TPA would be instructed in the audit report to correct the problem going forward so that future claims are paid correctly.

Answer 14

A quality sample that is representative of the entire claim file can be generated only from a statistically valid random sample. Otherwise the quality and accuracy of the audit could be compromised. Audits conducted under the random sample method early present any opportunity for recoveries and are performed mainly for admin compliance purposes - that is, to ensure the carrier/TPA is administering the plan according to the plan doc. The likelihood of the random sample including large-dollar claims with opps for recovery are slim, though not impossible. OTOH, if the ASO agrmt allows for it, the auditor can handpick the sample. This method allows for more of a focus on the large-dollar claims that may have been overpaid, and on where there is potential for a recovery from the provider. A popular variation on these two methods is to split the sample: handpick the large-dollar claims (w/ recovery potential) using a portion of the sample, and randomly select the other portion in order to check for admin compliance with the plan doc.

Answer 15

Typically begin with a kickoff meeting/call where overview of process is presented to ensure sponsor’s objectives are fully defined & understood. Auditor then collect info from sponsor & admin. After receiving the data & info from both, most auditors will complete a comprehensive data analysis & scrubbing process. Auditor will need to verify key plan info/enrollment data to ensure an accurate audit. The auditor then determines whether suspect claims were processed correctly. Next, onsite portion of the audit: auditors have direct access to the admin’s system in order to validate potential over/underpayments and possible systemic errors/issues. Once the onsite portion is complete, along with input from carrier/TPA, a draft audit report will be issued. After the carrier provides feedback to the initial draft audit report, outstanding discrepancies will be addressed & final audit report issued. When the final audit report has been reviewed, common practice is to schedule a call with all parties to discuss the process, results, outstanding issues, recommendations for improvements & the recovery process.

Answer 16

1. Operational audits: look at procedures associated w enrollment, including ID card processing, customer service standards, etc. 2. Reinsurance audits: to discover charges that should have been submitted to a reinsurer for reimbursement but were not 3. Transitional audits: to ensure a plan has been set up appropriately in an administrator’s systems when a plan is moving to a new carrier, from fully ins to self-ins, or to significantly diff Ben designs

Answer 17

Every 3-4y for most plan sponsors, if same carrier/TPA kept. Some prefer more often. Items that should trigger an audit: 1. A new carrier/admin 2. A significant plan design change 3. Admin concerns by the plan sponsor

Answer 18

Typically, <1% of total annual claim spending, and usually yes. Most of the time, recoveries more than cover the cost, although that’s not guaranteed. Depending on size of the group & audit approach, total costs range ~$25k-50k, but could be higher for larger groups. Fees can be fixed or paid on contingency related to recoveries, although some ASO agreements don’t allow for contingency.