Health insurance company BCBS to spin out Blue Health Intelligence

Health insurance companies have increasingly relied on data-driven decision-making based on claims data. Blue Health Intelligence, a data analysis business for Blue Cross and Blue Shield Plans, was created to help members as healthcare shifted to an evidence-based, decision-making model. BCBS will spin off the service into its own company and has sent aside $28 million for the shift.

The Blue Cross and Blue Shield Association will spin off its healthcare data analysis service, Blue Health Intelligence, into a separate business later this year, the association said.

The move will mean a larger pool of stakeholders – from hospital systems to consumers – could have access to the data Blue Health Intelligence culls from its health insurance companies. It also means larger and more vast revenue opportunities for Blue Cross and Blue Shield. Such services are increasingly relevant; healthcare reform legislation, and overall medical industry trends, focus increasingly on data-driven standards of care.

Started four years ago, Blue Health Intelligence analyzes tens of millions of insurance claims to provide details on how healthcare is used by customers.  The association touts its database as larger than the federal government’s. Blue Health Intelligence uses the data to highlight healthcare trend and insights into quality of care, which in turn cuts cost.

Blue Health Intelligence, based in Chicago, currently provides its services only to Blue Cross and Blue Shield plans. The new business, listed simply as Health Intelligence in incorporation documents filed in mid-December, would make that data available to outside organizations as well, BCBS spokesman Brett Lieberman said. Potential customers could include healthcare research organizations, other insurance companies, hospitals, individual customers or anyone who could wield such data to improve their businesses.

BCBS has already devoted more than $28 million to fund the separate business, according to regulatory filings. A chief executive officer should be named in the coming months, Lieberman said. At that point, the company would likely have more specific details about strategies and jobs, Lieberman said.

The new company will do the same thing as Blue Health Intelligence, Lieberman said: “improve the healthcare system, study areas where costs may improve and quality may improve, determine the best treatments … and improve healthcare quality, safety, delivery and costs.”

But the next evolution of a claims-driven data warehouse like Blue Health Intelligence could strike a nerve with physicians groups. Soon after Blue Health Intelligence was announced, the American Medical Association and others repeated their concerns that claims-driven databases are used less to determine quality and more to find and promote cheap doctors to cut payers’ costs.

This debate has become much more nuanced since 2007. Insurers and physicians are slowly working closer together on many data-driven joint projects, including a pilot electronic medical records program. But lawsuits and state laws continue throughout the country. They confront insurance companies saying that claims data is used to isolate more expensive physicians and promote cheaper, in-network doctors.

“Regardless of what data is put together or how it is construed there is always the concern that quality is what costs less. That is not the cornerstone of healthcare delivery and high quality patient care,” said Jason Koma, director of communications and marketing of the Ohio State Medical Association. “I can’t specifically speak to this venture. But it sounds like there is a very slippery slope between making this data available and making some wrongful assumptions on quality care based on dollars and cents.”