All-Payer Claims Databases Could Improve Transparency

Healthcare spending is increasing, as many Americans struggle to afford health insurance, prescription drugs, and even preventive care.

Authors of a recent study, which was published in the New England Journal of Medicine, suggest that implementing all-payer claims databases may be the key to fixing the healthcare system.

Currently, claims databases are limited. Medicare data only includes patients age 65 and older, and prices are set administratively, which makes this database not representative of the real-world. Commercial insurance databases are also limited due to the small amount of patients covered.

All-payer claims databases have only been implemented by 16 states thus far. These databases gather expansive data about insurance eligibility, the insurer, and claims. In theory, the databases will provide a more realistic view of the state’s healthcare system.

While the databases have been useful, the March 2016 Gobeille v. Liberty Mutual Supreme Court decision may present a significant barrier going forward, the authors reported. This decision prevents state-mandated reporting from self-insured employer health plans, which covers millions of Americans.

Interestingly, this decision may also improve the prospects for these databases, according to the study.

A main component of all-payer claims databases is the disclosure of prices paid for certain services, which has largely been unavailable because it is considered proprietary information. These data are important for initiatives regarding increased healthcare transparency, which is where the healthcare system is heading.

Transparency has become extremely important to individuals, since many of them are now enrolled in health plans that have shifted a large portion of the costs onto them.

Data from these databases can also be used to inform policy and regulation decisions. After passing its healthcare reform initiative, Massachusetts discovered that increasing healthcare costs may jeopardize their insurance expansions.

As a result, state lawmakers set a goal of keeping healthcare costs at or below the rate of growth in the gross state product, according to the study. The state has used information from all-payer claims databases to observe any cost increases by providers and insurers. This information was also critical in a court case against a healthcare merger, where the state argued consolidation would lead to higher costs, and used data to prove it.

These databases could also improve quality measures since it combines data from numerous payers. Accountable care organizations can also use these data to evaluate their efforts compared with those of other organizations to ensure that they are performing up to standards.

Public health officials can also use these data to monitor the prevalence of diseases and related issues. Additionally, all-payer claims databases can be used to improve understanding of the healthcare system, and could potentially be used to implement policies to improve care, according to the study.

Despite numerous benefits, all-payer claims databases can be quite costly, with Massachusetts spending $7.6 million in 2015 to run the database. However, some states choose to implement data licensing fees to recover some of the costs.

Payers may also oppose new reporting requirements that are added on to current requirements, but states could potentially implement novel methods to reduce redundancy that may be experienced.

The data may also present a challenge, since each insurer has unique systems and offerings that may not translate into state-mandated data specifications, according to the study. Some insurers may not be able to provide certain data either.

While the Gobeille decision has been a setback, the court’s majority suggested that states can obtain self-insured plan data from the Department of Labor, the authors wrote.

The department even recently proposed an expanded insurance plan reporting requirement that would include data that may be vital to all-payer claims databases. The final rule will call for a national standard for data submission that will streamline the process for payers and states.

These new efforts also have the potential to reduce the time and resources needed to create and maintain all-payer claims databases, according to the study.

Achieving better care, better health, and lower costs will be dependent on an expanded understanding of the healthcare industry. While these databases may present some issues, they offer the opportunity for improving numerous aspects of healthcare.

Ultimately, the success of all-payer claims databases is contingent on the states’ ability to gather expansive and timely data. The implementation of all-payers claims databases will likely lead to increased healthcare transparency, and provide benefits to patients and insurers alike, the study concluded.