Stop the Bleeding: Two Ways Health Plans Can Save Money and Improve Care

BHI Thought Leadership

Unnecessary care that provides little to no clinical benefit, and services performed in high-priced or inappropriate settings are costing health plans billions each year.

Eliminating Unnecessary Care

To determine the extent of unwarranted tests, prescriptions, and procedures being delivered within health plans, data scientists from Blue Health Intelligence® (BHI®) examined claims from more than 39 million eligible members. Of the 9.2 million diagnosed with certain conditions, 1.4 million received low-value care. The eight conditions initially examined racked up almost $1 billion in potentially avoidable costs.

Conditions include:

Imaging for uncomplicated headache $277.7 million
Imaging for non-specific low back pain $220.5 million
Abdominal CT combined studies $185.5 million
Spinal injections for back pain $148.2 million
Head imaging for syncope $43.2 million
Thorax CT combined studies $15.4 million
Simultaneous brain/sinus CT scan $31.1 million
Imaging for Plantar Fasciitis $5 million

Moving forward, BHI will continue to examine another set of conditions in 2019.

Shift Care to More Suitable Sites and Providers

 In helping plan leaders better serve their national accounts, a recent BHI study found that health plans could save millions each year if they directed low or moderately complex services to less-intensive settings and the most appropriate providers.

Through its analysis, BHI found that for every $500 million in medical costs, about $12.5 million could be saved by shifting care from hospitals to medical offices, particularly for:

  • Imaging ($2.3 million)
  • Radiation therapy ($850,000)
  • Colonoscopy ($400,000)
  • Upper GI endoscopy ($200,000)

For one health plan, BHI discovered it could save 4 percent of its total medical costs by transferring its top seven procedures – which ranged in complexity from hysterectomies to cardiac stress tests – to less-intensive sites. Simply moving chemotherapy to other settings saved $5.3 million.

The Benefits of Steering Members to The Right Care in the Right Place

Using the power of big data and predictive analytics, health plans can significantly reduce low-value care and identify optimal care sites. Both types of analysis enable plan leaders to:

  • Target and address geographic areas that have significant volume and cost variations from norms
  • Require prior approval or medical necessity reviews for certain low-value care procedures or procedures performed in certain settings
  • Make contracting and plan design changes based on low-value care and site-of-service performance metrics
  • Waive or limit coinsurance and deductibles for use of less-intensive sites and providers
  • Reward providers for reducing certain low-value care targets

BHI’s database of more than 180 million unique patients’ medical and pharmaceutical claims – primarily from health plans — is more accurate, extensive, and timely than any other. It enables data scientists to provide more accurate insights into plans’ unique financial challenges. Contact us today to learn more about how we can help your plan to reduce costs.