A recent HIMSS Analytics white paper showed that using clinical data to decrease costs was a top concern for health plans. Respondents emphasized the importance of becoming more strategic with regard to both individual patient data and data that relates to groups of patients in identified geographies. In comparison to health providers, health plans are often viewed as more tech-savvy with regard to leveraging business intelligence tools. However, this data use is currently largely limited to answering tactical questions, such as instances where diabetes patients are not following treatment plans. However, when it comes to the strategic use of data, many health plans are struggling. They would like to be enabled in the broader use of data to answer more complex questions such as predicting who is most at risk for non-adherence to treatment and hospitals that rank highest in preventing readmissions.
When it comes to data and strategy, Business Performance Management (also referred to as “the other BPM”) is a great option for health plans wishing for more strategic use of actionable data. BPM is a Business Intelligence-enabled approach with an integrated strategy platform. According to the BPM standards group, BPM is defined as “a set of integrated, closed-loop management and analytical processes, supported by technologies, that address financial and operational activities.” On the IT side, BPM consists of a combination of computer applications used to develop and execute business strategy. On the business side, BPM is used to help create strategic goals through the discovery of key objectives and performance measures based on analytical tools such as predictive modeling, customer relationship management, dashboards, and automated scorecards.
Using BPM to Manage Data Strategically
BPM consists of four processes. The two initial BPM steps, namely Strategize and Plan, closely parallel the strategy map creation process found in the balanced scorecard approach developed by Kaplan and Norton. The last two steps, Monitor and Act & Adjust, can be used to create additional value beyond what is provided in the balanced scorecard methodology. The four BPM processes together form a closed-loop business strategy system that connects strategy to execution.
Here is a summary of the BPM process health plans could use to make more strategic use of data to drive down costs:
Strategize: During the Strategize process, health plans would identify the goals they would like to achieve and incorporate them into a formal business strategy. Health plans may find the prospect of identifying the appropriate strategic goals challenging. However, the strategy map found in the balanced scorecard approach is a widely-used method for achieving this challenging task. The most essential component of the Strategize phase would be selecting the lag and lead metrics that are most highly correlated with the end goal of decreased costs.
Plan: During the Plan process, health plans create a detailed resource allocation plan that will be used to meet the strategy created in the earlier phase. Departments or business units work together to create an enterprise-wide plan that is cross-functional and ensures that business units work together in areas where their functions overlap with regard to strategic goals. This is key since it gets the health plan away from judging individual factors for stand-alone performance and instead rewards contributions to the overall metrics identified in the scorecard. Business intelligence emphasizes getting rid of data silos. The Plan stage of BPM helps organizations get rid of strategic and tactical silos as well.
Monitor: The BPM approach will provide health plan managers with the vital data they need to make strategic decisions. By using digital scorecards and dashboards fed by BI data, managers are not only able to watch the long term trends for the metrics selected, but they can also be alerted when shifts and changes require action. BPM creates additional value to the balanced scorecard approach by contributing reporting, alerting, and analytic tools that can help the health plan monitor performance against strategy. Executives can drill down into historic and real-time data to analyze performance.
Act & Adjust: Faster analysis and decision making can create a powerful strategic advantage. Health plans can identify potential flaws and short-comings in the cause-and-effect relationships that drive performance and costs. Reaction times can be cut from hours and days down to minutes. As the balanced scorecard is used and feedback is received, the health plan can begin to test the hypothesis of their original strategy through formal testing, such as statistical regression analysis.
Want to learn more about business intelligence and business performance management? Visit us April 27th and 28th in Chicago at Microsoft Connected Health. You can find us in booth 14 or you can view our landing page here.