Better Care at Lower Costs

Outcome Solutions

We have two outcome solutions. The first combines medical and pharmacy claims with HR or absence records, while the second uses just the claims.

Claims + Absence Costs

Our solution that combines medical and pharmacy claims with HR or absence records works for employers that self-insure their health plans or workers’ compensation programs (including employers in Texas who opt out of workers compensation and adopt an injury benefit plan), as well as workers’ compensation insurance companies and TPAs.

We define an employee returning to work from their illness or injury as a "good outcome." Having marked that point in time, we measure all the costs to get the employee there, and those costs are not only the claims paid to the doctors and hospitals, but the absence costs while the employee was out, which can be even more. For employers we obtain the absence costs by juxtaposing the claim dates against the HR attendance records, while for workers’ compensation insurance companies and TPAs we use the loss runs and check registers.

And those absence costs do double duty. Not only are they a real cost, but they’re an indication of the effectiveness of the care. The quicker a doctor got the employee better and back to work, the more effective the doctor was.

We then rank each provider in the network by root diagnosis, from the best with the lowest average risk-adjusted cost (claims + absence costs) when treating employees with that condition, to the worst with the highest.

We can show this on a graph. For example, say we are analyzing back surgeons. Along the horizontal axis are their average risk-adjusted claims costs, running from high on the left to low on the right. Along the vertical axis are their average risk-adjusted absence costs, the time that their patients miss work, running from high on the bottom to low at the top. The best surgeons are in the upper right quadrant‒low claims cost and low time off‒and the worst surgeons are in the lower left quadrant‒high claims cost and high time off.

In workers’ compensation we go a little further. Our platform interfaces with the Official Disability Guidelines (ODG). We can benchmark providers against the guidelines in multiple ways. For example, we can compare actual results against the benchmarks by injury for claims, time off work, and unusual procedure codes used (which could be either good or bad, but bear investigating). We can also show claims that are within the norm and can be paid, and flag claims outside those norms for further scrutiny. In addition, we can use the guidelines to perform predictive analytics, both at the outset of an injured employee’s case and as it progresses.

Claims Only

Our solution that just uses medical and pharmacy claims, which we call "Clinical Efficiency," works for health insurance companies, Medicare & Medicare Advantage Plans, ACOs and multi-employer health plans.

With Clinical Efficiency, instead of asking how much it cost and how long it took to get an employee better and back to work, we flip the question and ask how much it cost in claims to keep a person well; and we define being well as not spending time in the healthcare system (e.g. hospital stays, doctor visits, etc.) or otherwise being non-functional.

We then rank each provider in the network by root diagnosis, from the best with the lowest average risk-adjusted claims per functional day when treating patients with that condition, to the worst with the highest.


We provide these analytics to our clients through a powerful internet portal consisting of interactive dashboards and reports. You can stop there, or move from analytics to action and steer everyone to the best providers (even when only using employee data to calculate the rankings). To do so, we provide streamlined portals to: (1) case managers handling high cost and chronically ill patients, (2) physicians referring patients to specialists and surgeons, and (3) patients (the patient portal, however, is not available for MA Plans).

Unique Methodology

There are several unique and critical aspects to our algorithms:

Root Diagnosis. We group the calculations by root diagnosis because a doctor may be great treating diabetes, but lousy with asthma.

Risk Scoring. If you ask any doctor why their costs are more than another doctor’s, they’ll always give the same answer. "Because my patients are sicker." And sometimes they’re right. Sicker patients cost more, and take longer to get better. If you have two patients with the same back injury, one of them young and otherwise healthy, while the other older, overweight and diabetic, the older patient is going to cost more. So we adjust for comorbidities by assigning each patient a risk score. That way our rankings are based solely on the provider performances, not the patients that they treated.

Allocating Costs. When allocating costs to a physician we assign them both their direct costs and the indirect costs from their downstream referrals. If a doctor sees a patient once and then refers them to a surgeon, that doctor’s direct costs will be low compared to another doctor that works with the patient to avoid surgery. However, the overall costs‒direct + indirect‒will be much higher. So we include all costs for which a doctor is responsible.

Sorting. We sort providers into categories, because you can’t compare a PCP to a surgeon. And we can sort by geography and other parameters as well.

Network & Plan Design

Our primary focus is ranking the providers within a network. We can also rank other things based on the outcomes that they achieve (e.g. plans, programs, case managers, etc.).

In addition, clients can use our analytics when designing their networks and plans. When designing a provider network, a client with the ability to do so could include only the best providers for each root diagnosis‒or at least eliminate the worst. And in this respect, there is a fundamental difference between health plans and workers’ compensation programs. In health plans you can only encourage a patient to go to the best providers. In workers’ compensation, however, in many states (including Texas) an employer can direct care and require an injured employee to go to the doctor that the employer selects.

With respect to plan design, a client could stratify its network and decrease or eliminate co-pays and out-of-pocket costs when going to the best providers. If an employer has an HDHP married with HSAs (High Deductible Health Plan & Health Savings Accounts), the employer could encourage employees to go to the top ranked providers by contributing to their HSAs when they do so.

Finally, MA Plans can use Clinical Efficiency when structuring their CMS bids.

Using Both Solutions

Some clients can use both solutions. For example, health systems are large employers that will use the claims plus absence costs solution for their employee health plans and workers’ compensation programs. When they also have affiliated health plans that they market in their communities, they will use Clinical Efficiency.

Insurance companies, on the other hand, will use Clinical Efficiency for their plans. They are large employers too, however, and will use the claims plus absence cost solution for their own employees. And when they market their plans to self-insured employers, they can provide those employers with the claims plus absence cost solution so that those employers get the most out of the insurance company’s provider network‒a competitive marketing advantage for the insurance company.

Getting Started

We take three to five years of past data from a prospective client and model it to show how much we could save. If we move forward, we then have a head start and know who the best providers are on Day 1.

Data Security

We take the claims and absence data in encrypted feeds over our secure FTP site, and everything is fully HIPAA and SOC compliant. As discussed above, in the beginning we take three to five years of historical data, which enables us to deliver robust results on Day 1. After that, we take monthly or quarterly updates.

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