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aced with fast-paced changes in the health care market landscape, a dynamic regulatory environment, and ever increasing competition, the managed health care sector is constantly looking to increase competitiveness, reduce costs, and deliver better patient care.

While Managed Care Organizations (MCOs) strive for sustainable competitive advantage, IT can play a very important role in their overall strategy for achieving it. MCOs have long understood the potential value locked up in the data they routinely collect and store. However many factors have kept them from harnessing the complete value of this data. These include: Lack of data integration across multiple heterogeneous systems (claims, laboratories, pharmacy systems) Tedious management reporting process that may require numerous iterations to produce even simple reports Lack of timely access to data required for operational and strategic decision making

In addition to impeding operations, lack of this data also affects consumer-focused sales and marketing efforts. To sum it up, a fragmented IT system impedes decision making for both operational and strategic purposes. How can this diverse data, in multiple systems be integrated and used to make health care organizations more competitive? Bringing together the various pieces of data around Episode of Care presents one such opportunity.

What is an Episode of Care (EOC)?

An Episode of Care (EOC) can be defined as the set of services required to manage a specific medical 1 condition of a patient over a defined period of time . For example, in the case of a tonsillectomy procedure, an EOC would include the pre-surgical evaluation; the actual surgery; the anesthesiologist; the operating room; pathologist; the operating room team; and follow-up visits to the ear, nose, and throat specialist and primary care physician, all bundled together for a single price. EOC is increasingly proving to be a more accurate and holistic approach to estimating the cost of health 1 care . To be competitive in the marketplace, a health care organizations operational data must contain a complete, i.e., 360 degree view, of all occurrences associated with an episode of care.

Shreeve, Scott, Episodes of Care: You have got to be kidding, May 27, 2008 (http://blog.crossoverhealth.com/2008/05/27/episodes-of-care-you-have-got-

to-be-kidding)

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Why is EOC Useful?

The traditional fee for service (FFS) approach uses measurement based on population measures, such as absolute counts, or averages. For example, the number of times a practitioner prescribed antibiotics, the average number across patients, across number of visits, etc. However, this approach lacks clinical correlation. Based simply on population measures, it cannot be convincingly ascertained that one physician prescribes more antibiotics than another does. Any assessment of appropriateness needs to look into individual episodes. Moreover, the above approach creates practitioner distrust. An EOC-based approach allows for better clinical correlation. For example, the use of azithromycin is appropriate in a case of pneumonia, but is an overuse if prescribed for a chest cold. The use of antibiotics per episode (an EOC-based measure) is a much more accurate measure than the average antibiotics usage across patient population (a traditional population-based measure.) In addition, an EOC-based approach allows providers and payers to better estimate the cost of health care delivery by allowing charges to be based on categories of episodes also called Episode Treatment Groups (ETG). Since a finer grain of data is used, the risk estimation techniques also yield better results. EOC is a step towards the overall goal of improving quality of health care that can be achieved by 2 reducing overuse, underuse, and misuse. The concepts of EOC are relatively new, and the idea of reimbursing for care in this way is picking up momentum. This is an important ideological transition, moving from providing fee for service, pay for procedure mentality to a more comprehensive, holistic approach to delivering care. It also is a very important enabler towards the eventual state of a retail health market and organizing health care into a service-based product that consumers can compare, shop, and purchase. While that market-state is far out in the future, implementation of EOC-based analytics is something that the health care payers can implement today, and start reaping big benefits.

Introducing Episode 360

a 360 degree view of every episode of care in your data, allows you to get a single consolidated view from a variety of systems claims, laboratory, pharmacy, dental, and vision, to name a few. It helps you slice and dice, and completely analyze: The performance of health care providers High dollar episodes Top procedures overview, and other similar business focus areas
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Episode 360 is an end-to-end Business Intelligence (BI) solution comprising: Dashboards and scorecards that provide vital Key Performance Indicators (KPI) to users from operational decision-making analysts to analytical decision-making executives Enterprise Reporting capability from a central consolidated data repository

Greene, Robert, MD, FACP, Why use episode of care methodology? PAI Seminar Understanding Episodes of care, Chicago, June 22, 2007

(www.ismanet.org/pdf/resources/PowerPoint%20Presentations/PAI%20-%203%20Why%20useful%20FINAL.ppt)

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Flexibility Delivered
The implementation of PPCs Episode 360 solution is vendor agnostic, thus allowing companies to leverage their current investments in business intelligence and data integration tools.
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With our ready-to-go data warehouse models and report templates, your organization will need to invest minimum effort to integrate our solution with your current environment. The figure below illustrates a highlevel architecture of Episode 360 .
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Figure 1: Episode 360 System

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Benefits Realized
Episode 360 allows MCOs to focus on health care costs. You cannot control what you cannot measure. Using data to facilitate cost comparisons across delivery systems, bundling related treatments into logical packages of EOCs, and providing visibility into pricing data are all capabilities offered by Episode 360 , thus allowing MCOs to measure, and ultimately control, costs.
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As an end-to-end Business Intelligence solution, Episode 360 not only offers significant capabilities out-of-box for faster time to value, but can also be extended to related areas to provide a single view of patients or of providers. Below are some examples of the analysis that can be performed using this BI solution:
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Process Area Identify your providers

Episode360 Reports Create a 360 degree view of providers by deduplication of provider information existing in multiple systems Identify high volume providers and assess their business value/costs Track dollars spent on physicians, facilities, and pharmacies Optimize provider networks Understand provider quality metrics to support Pay for performance Analyze cost/benefit ratio of bringing new products to market

Data Sources CRM Application Plans System General Ledger

Improve Operations Meet customer needs

Provider System Pharmacy System Plans System Claims System Plans System Claims System Call Center Log

Source: Rajeev Kumar, Adaptive Insurance Data Warehouse

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Conclusion
It is clear that Business Intelligence has a significant role to play as health care organizations try to understand all of the cost components of various treatments and use this information to develop average costs for procedures, such as hip replacements and heart surgeries. Industry-standard cost comparisons that look across providers are not far away. The logical next step is to provide accessibility to this data to facilitate consumer choice based on pricing and, looking forward, on quality of care. Medicare is already reporting on common costs for physicians and hospital procedures, and insurers are beginning to provide cost comparison data to their customers. As this trend continues, providers will have no choice but to focus on cost analysis themselves, particularly, if their pricing is outside industry norms. To remain competitive in the market, Managed Care Organizations must become more agile and employ efficient ways of looking at organizational data for improving efficiencies, reducing costs, and managing risks. Towards this end, PPCs Episode 360 can be a very important, and powerful, tool in their hands.
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About Project Performance Corporation

Project Performance Corporation (PPC), part of the AEA group, is a management consulting firm integrating world leading expertise in the areas of environment and energy with cutting edge IT and global management. Our customers include Fortune 500 and top government decision makers.
PPC offers a unique blend of experience combining our understanding of the customer and subject matter expertise with information technology to devise a meaningful solution that make a difference. Visit us at www.ppc.com. PPC offers a wide range of expertise for the health insurance industry. PPC service areas include: Business Intelligence and Data Warehousing Master Data Management Business Process Management Portal Solutions Knowledge Management Enterprise Security

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Lisa Loftis, "Transforming Health Care with BI", Subset//BI & performance management, Information Management Magazine, March 2, 2009

1760 Old Meadow Road, McLean, Virginia 22102 703.748.7000 www.ppc.com