The camouflage on the cost and quality of heath care in America is blessedly being stripped away by entrepreneurial initiatives. Payers can finally get a glimpse at what they are buying and for how much.
Several of the initiatives are Wisconsin-based.
Serigraph Inc., where I hang my hat, was at the ramparts eight years ago when its head of human resources, Linda Buntrock, dug into our claims data to elicit price ranges on ten common procedures. With the help of Anthem, our health plan, she proved it could be done. Today her intranet web site called MedSave shines a bright light on almost 100 procedures, including A, B, C quality ratings and volumes done at different health facilities.
There is a high correlation between volumes of procedures done at a facility and quality of outcomes.
Our co-workers routinely check our MedSave web site before they sign up for a medical procedure so they can buy the best value. They and the company have saved hundreds of thousands of dollars over the eight years.
Today, there are entrepreneurs jumping into the market space for transparency. They have recognized that an army of consumers is being created by consumer-driven health plans, and those consumers need market information. Insurance companies and health care companies are also putting out some price data.
One startup called Alithias, started by Ross Bjella, a smart entrepreneur, used the Serigraph concept to develop an even better system. He has sold it to major self-insured companies in the Sheboygan area and others in the Fox Valley. It even has an “app” so consumers can look up prices and quality at any time on their mobile devices. Just punch in “hip replacement” and up comes a menu of options in the area.
One of the latest to bring a transparency product forward is an Iowa firm named Auxiant, with offices in Milwaukee and Madison. It offers a product called FocusHealth that gives hospitals and clinics an overall composite score on value by hospital, and it drills down to separate procedures. The value score derives from separate cost and quality scores.
Take spinal surgery as an example in one market. Auxiant, using claims data, rates the Aurora Medical Center in Hartford in the 83rd percentile in Wisconsin (100 is tops) for cost performance and 74th for quality. Community Memorial in Menomonee Falls rates 70 and 43 respectively. Froedtert Health/St. Joseph’s Hospital in West Bend scores 57 and 68.
So, the top value in this small market, represented by a green thumbs-up icon, goes to Aurora Hartford for that procedure.
Auxiant is doing business with the City of Manitowoc and its utility, proving that public sector payers can be innovative in managing health benefits as well as the private sector.
There are a half dozen other entrepreneurial companies that have jumped into the race to provide consumer information about health care. One called Castlight has raised $180 million in venture capital money in Silicon Valley and has started peddling its wares to companies like Honeywell. It is making sales calls in Wisconsin.
Each entrant has different features. Some include “navigation” services for employees as they make elective treatment decisions. Castlight intends to drill down to quality performance at the doctor level.
A transparency bombshell was dropped from another source last month. Consumer Reports came out with ratings for Wisconsin hospitals, based on information voluntarily submitted by some providers to the Wisconsin Collaborative on Health Care Quality, and they are eye opening.
It uses its long standing red dot and black dot icons for positives and negatives respectively for displaying hospital records in the state on five dimensions: safety, bloodstream infections, avoiding readmissions, drug information and use of electronic medical records.
The most red dots went to Bellin Memorial in Green Bay. Its safety score was 74 on a scale of 100, and it had a full red dot for infections and a half red dot for readmissions.
For example, Community Memorial recorded a 48 on safety, a half red dot for electronic records and a half black dot for readmissions. St. Joseph’s was not rated except for half black dots for readmits and infections. The Aurora Health system chose not provide data to the Collaborative.
The Collaborative and Consumer Reports have a lot of holes to fill in their report. Many Wisconsin hospitals were not rated or only partly rated. But it still is a great step forward for pushing providers to higher levels of value and for helping consumer make good decisions.
Consumer Reports has issued similar statewide findings in Minnesota and Massachussets.
The cork is out of the bottle on consumer health care information, and it is not going back in. Payers, both employers and employees, won’t stand for the incomprehensible bills of the past.
John Torinus is chairman of Serigraph Inc. in West Bend. He is involved with several business and civic organizations and is the author of “The Company That Solved Health Care.” His blog appears regularly at www.johntorinus.com and is republished with his permission by BizTimes.
