ikaMBI Outsourcing Solution

ikaMBI (ika medical & business intelligence) is an outsourcing solution that leverages integrated utilization & disease management systems and the business intelligence expertise of ikaSystems' health care utilization and quality of care division, which is well known for its extensive and in-depth experience, knowledge, and expertise in both health plan and provider sides of the industry - this translates to being able to consistently provide financial and quality of care value to every stakeholder in a health plan.

ikaSystems' expertise is exceeded only by a passionate commitment towards reducing healthcare costs while enhancing quality of care, which clients have stated what makes ikaSystems a true partner as opposed to just a vendor.

ikaMBI systematically and synergistically leverages ikaUM (a comprehensive online utilization, reporting and management analysis system) and ikaDM (an online disease based management system) to help health plans analyze the professional and financial components of their plans and the corresponding quality of care being provided. With the aid of appropriate and timely intelligence, ikaMBI experts assist health plans to structure proactive strategies that decrease medical expenses by as much as 25 % while improving the quality of care provided.

ikaMBI's effectiveness is predicated on the fact that higher quality of care costs less and that a progressive cycle of better quality of care results in improved utilization. ikaSystems has consistently shown that quality of care is an excellent proxy for cost - an inverse relationship exists between optimum health care expense and quality of care regardless of plan size and location.

Using precise utilization and quality of care analyses, ikaMBI provides realistic answers to today's challenge on how to positively impact every stakeholder in healthcare - the member, provider, employer, and the health plan.

ikaMBI's value proposition extends to every tier of the health plan, for example:

- Senior management (CFO, CEO, COO, CMO) can utilize the intelligence to determine strategic direction, evaluate whether Pay for Performance (P4P) programs are realistic, easily understand long-term utilization threats, opportunities, etc.

- Medical management can utilize physician profiling information to tier providers based on the quality of care and utilization, which forms the basis for structuring and implementing realistic P4P programs.

- Medical management can utilize membership profiles to implement preventive and proactive health management programs much more cost effectively, e.g. a disease-based management program is much more cost effective when it is targeted at the population in need.

- Medical management can utilize physician profiling data to improve the quality of care capabilities of underperforming providers/provider networks.

- Risk Management can obtain a realistic picture of their risk profile of different member groups and implement more effective plans that address the risks proactively. They can also determine and address fraudulent claims patterns.

- Introduces members and employers into the economics and quality of care equation.

- Underwriting can obtain risk information at a granular level that will help them rate/quote more realistically, which will reduce unfavorable variances in the MLR.

- With more realistic plans and rates, sales staff and brokers can increase membership retention and levels, and close ratios.

- Providers ca raise their quality of care and ensure that members receive better care.

ikaSystems’ analyses have shown that although it is easy to assess real health care costs, cost management is possible only by reducing the magnitude of the cost variation (about 60%) between physicians who are above and below the average resource utilization.

ikaSystems' observations have also consistently revealed that 65-70 % of primary care physicians are both cost effective and offer high quality care. Primary care physicians in this tier usually have less than 30% of all the catastrophic cases.


Methodology

The ikaMBI process begins by accessing the health plan’s claims data – all that is needed is a data dump from the claims system – a simple process that has been performed repeatedly for 65 health plans over the past 15 years.

The process then begins in earnest with valid (proprietary case mix adjusted) analyses of provider and provider network performance and the corresponding quality of care being delivered. Based on rigorous analyses across the broad spectrum of the data collection points, focused and targeted utilization reports are created to determine gaps, opportunities, quality of care, fraudulent claims, and to unearth a host of other relevant information. Providers are realistically profiled and tiered, and the basis for structuring and implementing realistic provider incentive programs, such as P4P, are determined, which can reduce the variation of health care costs across the network.

The ikaMBI methodology utilizes real data pertaining to a health plan. This approach is much more precise and yields more realistic and targeted intelligence – as opposed to utilizing generic predictive modeling algorithms.

On the other side of the spectrum, membership risk is determined at a granular level. Membership is analyzed to determine high risk/high utilization populations for targeted programs. Areas where more aggressive, proactive, and dynamic participation and interaction between members, providers, and health plan staff is necessary to improve quality of care and reduce medical expenses are also identified.

The ikaMBI results provide a clear map of hidden roadblocks at all three levels: strategic, tactical, and operational. These analyses are used to develop effective strategies that will yield tangible results in the short-term as well as provide sustainable improvements in the long-term.

Case Study

A brief look at the results of the analysis of an actual case is given below. The table relates to a commercial insurance entity covering an average annual membership of 450,000 lives and all medical expenses for calendar year 2004.

There were 2,200 PCPs caring for these members, who were enrolled by their employer sponsors. The PCPs are divided into two tiers based on utilization and quality of care. There were 58 quality of care measures utilized, including 38 from NCQA and 20 more from ikaMBI’s ZQI (Zak’s Quality Index).

We identified 1,080 PCPs (Tier 1 cost effective PCPs with average care capacity of 2,000 lives per PCP) whose total medical expense on behalf of their members was $138 PMPM (per member per month). If the loss ratio is 80%, a null profit premium would be $172 PMPM for these PCPs.

Row 2 shows that Tiers 2 PCPs have a higher utilization at $255 PMPM (and also providing correspondingly lower quality of care). The total utilization of PCPs in Tier 2 exceeds the total utilization of PCPs in Tier 1 by 85%.

If all PCPs are included in the calculation, the null profit premium at a loss ratio of 80% would be $245 PMPM, a reduction in total utilization of 30%.

Similar observations have been repeatedly made for Medicaid and Medicare Plans.