This is the success story of a healthcare plan manager achieving $1.5M in savings working with HCIQ.
Optimal Health Initiatives needed a way to negotiate for lower stop-loss coverage premiums and a more sophisticated approach to forecasting risk and health plan costs annually. Further, their manual reporting process on various health plan claims was tedious, time-consuming, and error-prone. Health Cost IQ (HCIQ) successfully addressed both challenges, resulting in $1.5 million in savings over two years, streamlining the reporting process and substantially lowering overall health plan costs.
The Problem
Optimal Health Initiatives is a healthcare plan manager that provides shared savings and jointly administered benefit plan options for public employers. Their service covers some 16,000 employee lives across 15 school districts in five self-funded risk-sharing pools. Optimal Health Initiatives connected with HCIQ after discovering they were facing an astounding $5M in maximum liability coverage costs. They believed there was a way to negotiate for a lower number but needed analytics and reporting to support their position.
They were also looking to improve their reporting capabilities and reduce administrative costs, particularly by automating their preparation of consolidated loss-ratio reports. Historically, Optimal Health Initiatives’ administrative team prepared loss- ratio reports manually by consolidating paid claims data from various medical and pharmacy claim administrators. This process required hundreds of hours and multiple human resources to prepare each quarter. They needed a system that would reduce errors, improve data quality, and rein in the costs associated with preparing and distributing these loss ratio reports across their enterprise.
The Solution
Optimal Health Initiatives evaluated several healthcare technology vendors and predictive analytics providers via an exhaustive RFP process and ultimately selected HCIQ. They were drawn to HCIQ’s comprehensive data analysis and reporting service that includes custom data displays, robust enterprise data warehousing capabilities, and automated data acquisition and processing. The custom data displays could be formatted to Optimal Health’s specific reporting interests, the upgraded data warehousing would permanently free them from their dependence on multiple vendors for their various reporting needs, and HCIQ’s data automation capabilities would save them thousands of hours of administrative labor.
After selecting HCIQ, Optimal Health Initiatives integrated the HCIQ data warehouse platform into their operations. This platform, equipped with proprietary algorithms, provided a one-of- a-kind ‘Risk Sphere Measurement’ for each plan member, along with a forecast of the total cost for the upcoming plan year. Armed with these insights, Optimal Health Initiatives went to work addressing their skyrocketing liability costs. They constructed a compelling case and presented it to their reinsurance carrier. As a result, they were able to reduce their costs by 6%. This translated to a notable $650K in immediate plan savings. Supported by the intelligence they pulled from HCIQ’s platform, they extended the same negotiation strategy to address other expenses, culminating in a total of $1.5M in savings over a two-year period.
Additionally, Optimal Health Initiatives adopted HCIQ’s dashboards for plan administration with the goal of improving their consolidated loss- ratio report process. HCIQ’s automated report generation module, which can automatically pull and report on the various plan-loss ratios of claims paid without the need to deploy manual resources, aligned perfectly with Optimal Health Initiatives’ needs. Utilizing HCIQ’s tool, they successfully automated their labor-intensive data acquisition process across all their member school districts.
The Result
HCIQ’s SaaS platform and data intelligence have streamlined Optimal Health Initiatives’ administrative reporting responsibilities and increased their leverage in contract negotiations with carriers and reinsurers. These shifts in operations have dramatically reduced Optimal Health Initiatives’ overall health costs. In essence, HCIQ has maximized the value of the client’s data by turning it into actionable information and presenting it through consolidated, sophisticated, and easy-to-use dashboards.
HCIQ’s solutions have given Optimal Health Initiatives the following benefits:
- $1.5M in health plan savings
- Trustworthy intelligence that will inform future contract negotiations with carriers and reinsurers
- Thousands of administrative hours saved annually
- Prompt and accurate enterprise reporting
Furthermore, the two companies have established a supportive and collaborative working relationship. Optimal Health Initiatives will continue to rely on HCIQ to aid in the management and monitoring of their health plan costs.