NEWTON, MA. – McKesson Health Solutions and IBM are collaborating to provide business intelligence solutions for payers.
Although payers have been aggressively managing medical loss ratio, or MLR, in the last decade, they are seeing an uptick in the past couple of years, said Louis Kolssak, vice president of strategy and business planning for McKesson Health Solutions.
Between 80 percent and 90 percent of every dollar goes toward administrative and medical costs, he said.
The rise is attributed to a number of phenomena: Insurance coverage is either being dropped altogether or shifted from private insurance to public aid, and the aging population and cost of technology are spiking, Kolssak said.
“Plans are stuck managing the drivers,” he said.
The partnership between McKesson and IBM will focus on analytics.
“With the move to preventative care, payers need analytics for best outcomes to drive down costs,” said Dan Pelino, general manager of IBM’s Global Healthcare and Life Sciences Industry.
To put members into provider systems to better manage care, payers need to have analytics in the center of their evidence-based decision-making programs, he said.
By bringing together clinical, operational and financial data and running it through IBM’s data model, payers can look at the data and create automated programs that, for example, can flag new chronically ill patients in real time and send an alert in the clinical workflow system.
The ad-hoc analyses driven from business intelligence will also enable payers to detect fraud and abuse patterns as well as create new benefit plan structures and pay-for-performance programs.
Pelino said the two companies are collaborating on a number of other projects designed to produce better outcomes and lower costs. “There has to be a level of collaboration to gain efficiencies to lower cost,” he said.
Janice Young, program director at Health Industry Insights, agreed. She expects that the market will see more healthcare IT partnerships develop.
HII will release in late December results of its survey on healthcare IT investments post-economic collapse. Young doesn’t expect huge retrenchment.
“There are enough reasons to invest in health IT to manage cost and improve quality,” she said, referring to the consumerism model of providing information to consumers for better-informed decisions.