How to Make Workers' Compensation Analytics Actionable

by Karen Wolfe

Analytics demystified

Much is said about the savings value of analytics, yet few in Workers’ Compensation have actually implemented them. Analytics are often misunderstood, making the idea itself daunting. Even those who have implemented analytics lament they really do not know what to do with them.

Simply stated, analytics means analyzing the data for the purpose of gaining new understanding of the business process, identifying or maximizing revenue streams, and uncovering cost drivers in the system. That other industries use analytics is well known. The food industry, for instance, has made their use of analytics quite obvious. A brief examination describes how analytics can be simple.

Monitoring transactions

Supermarkets and grocery stores have long monitored purchase transactions with customers. Customer purchases are automatically documented at the register. That is the raw data. When those transactions are analyzed in context with other data, such as inventory turns and factors such as season and weather, conclusions can be drawn about how buying behavior changes when outside conditions occur. It can even be assumed (predicted) the buying patterns that have occurred in the past will be similar in the future when similar conditions occur.

Analytics made actionable

The food industry views data analyses as a work-in-process operational tool. While monitoring purchases, weather conditions are consulted electronically for all locations. Based on combined conditions occurring in a region that are known to effect buying patterns, the computerized distribution system is alerted and redirected. Periodic high demand inventory is immediately diverted to the affected region.

Data analysis is translated to operational intervention. The outcome is increased sales revenue and satisfied customers resulting directly from data analysis and monitoring with appropriate and timely action.

Translated to WC Managed Care

Similar to the supermarket industry, the Workers’ Compensation industry collects data continually. Also similar is the fact that different systems are used for different purposes, but all are related to the operation. In Workers’ Compensation the central operation is the claim.

Bill review systems document medical bills received and recommend payment based on data analysis (analytics). Claims systems document medical bills paid, indemnity paid, work loss, legal actions and other factors, all related to the claim. Still more data is collected related to pharmacy, utilization review and others. Amazingly, the rich data is rarely converted to operational tools.

Opportunity cost in Workers' Compensation
Unfortunately, most in Workers’ Compensation neglect to integrate and monitor their verdant data to identify cost drivers and opportunities to mobilize action early to thwart or limit potentially high risk and costly situations affecting claims. Integrating and concurrently monitoring the data from the disparate sources, can identify conditions and events that portend risk and cost—not dissimilar to monitoring storms and inventory in the food industry.

Link analytics to operations

In the supermarket example, analytics are linked to operations by mobilizing changes in distribution. Current information received on the ground programmatically alters the operational process. Similarly in Workers’ Compensation, informational alerts sent to appropriate persons gives them the jump on potentially adverse conditions in claims. Adjusters and nurse case managers receive specific information regarding new conditions in a claim and mobilize action. The critical information is derived from analysis of the integrated data and automatically delivered to the right locations for action.

Early intervention saves

In the food industry the distribution system is notified when adverse conditions occur in a specific location. The analogy in Workers’ Compensation is the right person is notified when adverse conditions occur in a claim. For instance, when known high risk conditions occur in a claim, that information is automatically transmitted to an appropriate person. A simple example is when multiple prescriptions of Opioids are found in the currently monitored data, a nurse case manager is electronically notified to take action.

Analysis of current, integrated data can be programmed to automatically create alerts to appropriate persons who take action, thereby making analytics actionable.

Infrastructure and efficiency

Besides gaining dollar savings and claim outcome value from analytics and technology making analytics actionable, other positive results are gained. A formal infrastructure is created for medical management, thereby optimizing efficiency. The Workers’ Compensation industry can dramatically benefit from making analytics actionable.

Karen Wolfe is founder and President/CEO of MedMetrics®, LLC, an Internet-based Workers’ Compensation analytics company. MedMetrics provides the apps to make analytics actionable.