Improving Healthcare Effectiveness Data and Information Set (HEDIS) Scores with Data Management

Healthcare seems to be on the forefront of the global consciousness as of late from the COVID-19 pandemic to the Medicare for all debate, all eyes are on the future of healthcare in the US.

Not surprisingly, the healthcare payer sector is one of the most highly competitive industries in the US and as such organizations are tasked with not only being efficient but also maintaining a high standard in effectiveness of care.

In recent years, payer organizations and governing bodies have turned to data analytics and health economics to differentiate payers and providers in a systematic and standardized way. The most popular performance metric for payers is the Healthcare Effectiveness Data and Information Set (HEDIS). HEDIS measures are heavily regulated and meticulously compiled by the National Committee for Quality Assurance (NCQA) in collaboration with the Centers for Medicare & Medicaid Services (CMS). Payer performance on HEDIS metrics is directly related to their CMS Star ratings, which are available to all members when they are choosing their healthcare and insurance providers.

Overall, the goal of HEDIS metrics is to provide patients with an objective measurement of a payer’s effectiveness of care. HEDIS is comprised of ~85 metrics across 8 domains, which gather and analyze patient care information from payers and providers against industry standard best practices. HEDIS scores effect both commercial (HMO) and public (Medicare & Medicaid) payers. And, according to the National Committee for Quality Assurance (NCQA), 90% of U.S. health plans rely on HEDIS measures to compare healthcare performance with other health plans.

HEDIS Incentives

Health plans recognize that there are widespread benefits in providing highly effective care that stretch beyond gaining a competitive advantage by earning higher CMS Star ratings. Higher HEDIS and CMS star ratings are also associated with accelerated payer reimbursement programs, can save money through performance-based provider reimbursements and can highlight gaps and inefficiencies in care.

Accelerated Reimbursements

HEDIS is now recognized as the #1 standard of payer reimbursement from federal and state agencies. Consider this, there are about 20-25 HEDIS measures that are directly tied to payer reimbursement. Each of those measures carries millions of dollars. Needless to say, we’re talking about a lot of money. The higher a health plan’s CMS star rating are, the more they are reimbursed for providing a higher level of care. Additionally, if star ratings fall below acceptable thresholds for 3 or more years a health plan can be forced to shut down.

Saving Money

With the goal of increasing HEDIS scores to attract more customers and provide a higher level of care, payers have devised a pay for performance (P4P) model that financially incentivizes providers to meet certain quality measures by incorporating more preventive services such as cancer screenings, children well visits and blood pressure management. In the same light, the P4P model is also setup to penalize healthcare providers for poor outcomes and gaps in care.

By aligning better patient outcomes with medical performance, payers are shrinking the gaps in quality care, therefore, ensuring that members are receiving preventative care and reducing the need for expensive surgeries and readmissions. This, in turn, saves money for commercial health plan customers, as well as publicly funded healthcare programs. Payers can then apply these savings to various organizational initiatives that can help further improve patient outcomes.

Highlighting Gaps in Care

Another advantage of incorporating HEDIS evaluations into a payer organization is that by their very nature HEDIS metrics will identify deficiencies. While HEDIS certainly rewards positive outcomes, it is also important to remember that it is a performance improvement tool which allows payers to recognize any weaknesses in their services. As I mentioned earlier, improving HEDIS scores has everything to do with closing gaps, so by shining a spotlight on deficiencies, payers can now shift resources accordingly to improve in those areas.

Improving HEDIS Scores

So far, we’ve examined the positive incentives associated with incorporating a HEDIS program. However, HEDIS evaluations are an annual endeavor. It is important that payer organizations continue to seek ways of improving their scores year-to-year. One certain way of doing this would be to implement a proper data management system.

According to the U.S. Census, there were over 300 million insured individuals in 2019. HEDIS metrics rely on data collected from all areas of a health plan from claims to provider information. Without proper data management, HEDIS metrics can easily be skewed or completely incorrect. If HEDIS information isn’t properly managed, payers can suffer financial penalties or, in some cases, even be forced to shut down for continuous violations. Here are a few key areas where proper data management can improve HEDIS scores:

  • Data Integration – Consolidating data sources will reduce complexity and make it easier to collect and connect the necessary data for HEDIS metrics.
  • Data Centralization – Delivering a single source of truth supports data governance and master data management. Additionally, health plans can be confident in the data they are using to calculate HEDIS scores, and annual HEDIS audits will run smoothly if all data is centralized, and transformations are clearly defined.
  • Data Modernization – Migrating from legacy to a modern cloud-based platforms can support the increased size of data seen in a growing organization and also accommodate the complex algorithms that HEDIS metrics are based on.
  • Analytics tools – Adopting proper business intelligence (BI) tools to securely share and develop data reports and dashboards can encourage targeted analytics to identify underlying causes of gaps in care.

At Data Ideology we have supported several payer organizations with their Healthcare Effectiveness Data and Information Set (HEDIS) initiatives by utilizing these very same data practices. Our unique experience in this area, combined with our methodologies, have yielded consistent positive outcomes for these organizations. By creating a custom framework that optimizes an organization’s data life cycle we, in turn, help payers maximizing HEDIS evaluations and CMS star ratings and, more importantly, enhance customer satisfaction.

Written by Rebecca Gazda

Managing Director at Data Ideology

Rebecca Gazda is the Managing Director with 15+ years of experience in Data and Analytics, Statistics, and Data Team Management.


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