How to Leverage Big Data for Employee Healthcare Savings

Big data has become, well, big. As companies amass more and more information on their customers’ buying habits, they can predict with increasing accuracy when and what those consumers want next. CNN reports that Amazon and Netflix are at the forefront of this data revolution, offering product or viewing options based on their customers’ respective buying habits.

Major banks are using big data to detect fraud. UPS spends $1 billion a year gathering data from its fleet of trucks to ensure the most efficient delivery routes. Even baseball teams like the Oakland A’s are relying on advanced metrics and number crunching to augment and sometimes supplant old-school scouting reports.

Big Data Insights From Healthcare Analytics

Health insurance companies amass huge amounts of data from claims everyday: Office visits, drugs prescribed, surgeries performed, and more. But few of those companies are equipped to translate those numbers into savings for employers. Group Health (now Kaiser Permanente) , however, is one of the exceptions.

Our model combines healthcare analytics, coverage and care. We offer a range of employee benefit plans as well as quality care at our medical centers when treatment is needed. Because we track doctor visits, facility visits, and prescriptions ordered, in addition to claims, we’re able to offer companies a more robust overview of where their health care dollars are going, and how it reflects on employee health. More importantly, we offer suggestions as to how to mitigate that spending.

For instance, we compared the ER usage of one client with that of our entire book of business. Our analysis showed accompanying expenses and which visits were typically avoidable. We predicted that by introducing an employee education effort on appropriate ER use, the company could reduce employees’ emergency room expense by half, saving close to $600,000.

To get a sense of how Kaiser Permanente uses in-depth health care analytics to help companies reduce their health care spend, watch this video:

 

  1. Edwin Lane, Moneyball: How businesses are using data to outsmart their rivals, CNN, Oct. 13, 2014.