Mine Your Health Plan’s Data

Aggregate data can be used to improve employee health and drive down costs

By John Scorza Nov 21, 2011

NEW ORLEANS—A health plan’s data hold vast potential. Aggregate data can be used to inform plan design decisions, improve employee health and drive down health care costs. That was the message from several speakers at the International Foundation of Employee Benefit Plans’ annual employee benefits conference here Oct. 30-Nov. 2, 2011.

“There’s gold in your information,” stressed David Blumenstein, senior vice president with the Segal Co. in Washington, D.C.

When used properly, data will help guide an employer’s health plan strategy, said Marcia A. Wright, senior director of medical affairs with Pfizer Inc. in Overland Park, Kan. With good data, employers can understand their employee’s health status and health care needs, she said.

Employers should track the cost and volume of their workers’ most common health conditions and the pharmaceuticals and procedures they use. Or as one conference speaker put it, look at your data “to know where you’re bleeding.” When a plan sponsor knows that, it can direct resources toward targeted populations and promote prevention and healthy behaviors, Wright said.


Look at your data “to know where you’re bleeding.”


Employers should mine their aggregate plan data to see what care is being provided and whether it is effective, agreed Peter M. Rosene, a shareholder in the law firm of Felhaber, Larson, Fenlon & Vogt in St. Paul, Minn. Are your treatments working? The answer to that question is the “low-hanging fruit” of a value-based health plan design that promotes wellness.

Aggregate claims data can be provided by a plan's insurer, broker or third-party administrator. Since individual information is not revealed, aggregate data does not run afoul of the Health Insurance Portability and Accountability Act (HIPAA).

value-Based Health Strategy

Using a value-based strategy, plan sponsors need to take steps to get results, Blumenstein said. “We’ve actually designed waste into the system,” he noted. There is no reward for positive outcomes and no penalty for poor results. Plan sponsors, Blumenstein said, need to hold providers accountable for healthy outcomes.

By improving the health of their plans’ participants, employers can lower their costs—but they must be proactive, said William J. Einhorn, the administrator of the Teamsters Health and Welfare and Pension Trust Funds of Philadelphia and Vicinity. That means that “you’re going to prevent that claim even before it comes through the door.” To achieve that, Einhorn said, good, reliable, comprehensive information is key.

For instance, pharmacy benefit management (PBM) data is the best indicator of the onset of serious conditions or diseases that will cost the plan in the future, Einhorn said. “PBM data are gold.”

Like other speakers, Einhorn stressed that plan sponsors should use data to make plan design decisions. Key information to know in this context includes: What services are being used? What services are not? What benefits or services should be covered but are not? “To make these decisions you need the data,” Einhorn said.

Understanding Your Population and Total Health Costs

Enrollee Information

Who is enrolled and using your plan?

Age, gender, member contributions, etc.

Direct Costs


Paid claims.

Contributions and administrative costs.

Claims distributions.

Indirect Costs

Absenteeism (includes lost time because of disability).

Presenteeism (includes return to work with limitations).

Impacts on quality of life.

Source: BeneFIT Design: Seven Steps to value-Based Health Benefit Decisions by Jack Mahoney and David Horn (GlaxoSmithKline, 2007).

John Scorza is associate editor of HR Magazine.​

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