The organizations responsible for paying for healthcare – health insurance carriers, health plans, employers, and governmental organizations – rely on analytics and reporting software to improve performance, better understand the needs of their members, and build effective clinician networks. Recently, we issued our inaugural report: 2019 Payer Analytics Market Trends Report. This first report on payer analytics builds on the 2019 Provider Analytics Market Trends Report we published earlier this year. It includes an overview of the payer analytics and reporting market as well as more detailed profiles of 18 vendors serving it.
Payer Analytics Market Classification
The range of different commercially available analytics and reporting applications available to payers is considerable. The need for cost and quality management has been a major driver of demand for these applications but the range of different payer goals addressed include:
- Understanding the underlying drivers of cost
- Identifying fraud, waste, and abuse
- Reducing high-cost, low-quality care
- Improving star ratings, HEDIS measures, and HCC risk scores
- Finding and plugging care quality gaps
- Optimizing clinical networks
- Predicting a range of outcomes, costs, and events
- Improving the efficiency of payment processes
Chilmark classifies the vendors of these applications into three categories: claims analytics, clinical analytics, and technology-enabled services. Claims analytics vendors are the largest and have longstanding relationships with payer customers. These vendors rely on their customer’s internally generated data sources – claims and related data – to build applications. Claims analytics vendors have had limited or no access to provider data sources outside of value-based contracts. Clinical analytics vendors have expertise with both payer and provider data sources because of their experiences helping both payers and providers under value-based contracts. They also tend to have more modern solutions than other vendors. Many are relatively unknown to payers. Technology-enabled services vendors generally work with some of the largest payer organizations. They deliver highly customized applications for a variety of purposes and end-user audiences.
Combined and aggregated clinical and claims datasets will soon be widely needed. These two sources complement each other and will give payers more opportunities for performance improvement
Clinical and Claims – Not Just for Value-based Contracting.
While claims analytics vendors have a very strong presence in the market, we feel that these vendors will need to evolve their approach sooner rather than later. Combined and aggregated clinical and claims datasets will soon be widely needed. The data from provider sources is more current and comprehensive than the often time-lagged and summary-level information in claims data from payer sources. The truth is that these two sources complement each other and will give payers more opportunities for performance improvement. A wider variety of new and emerging data types will also support different kinds of applications. The shift from volume to value is changing performance management fundamentally; the combination of claims, clinical, and other data sources will be the minimum data set for analytics and reporting applications. While it is true that payers currently don’t have good access to provider data sources, that will change over time.
Actionability Still Challenging
Translating the insights from these tools into action remains a challenge, however. Current analytics and reporting tools are excellent at identifying areas for improvement. Payers need engaged clinicians and members to take appropriate action. Clinical analytics vendors have a better record with clinician engagement than other vendor types. Nevertheless, payers and their analytics vendors continue to experiment with different ways to maximize the value of these tools by enlisting support among their networks, clinicians, and members.