Achieving better health outcomes for Medicaid patients as budget dollars decrease.
Done.
The Louisiana Department of Health and Hospitals engaged Unisys to manage new processes and technologies that have helped the agency decrease its annual Medicaid budget by $400 million while providing preventive care for citizens who need it the most.
Preventing Illness. Reducing Health Care Costs.
With Medicaid expenses that grew from $900 million in 1988 to a whopping $4.6 billion in 1994, Louisiana’s Department of Health and Hospitals (DHH), which manages the state’s Medicaid program has made cost containment a high priority for the past several years — a priority made even more critical by ongoing, significant budget cuts at the state and federal levels. But given soaring medication and hospitalization costs, along with the fact that 825,000 citizens in the state are eligible for Medicaid annually, cost containment at first seemed to be an almost-impossible goal to achieve.
However, thanks to a partnership between the DHH and Unisys, DHH is seeing that goal become a reality. Driven by the commitment that preventive care can reduce expenses, DHH engaged Unisys to create and maintain systems that provide easy access to information on how citizens can receive care before their illnesses — and the costs to treat them — escalate.
David Hood, Secretary of DHH, explains the rationale behind the philosophy: “Because of the cost of health care, when families lack insurance, they oftentimes put off preventive care. Those who are uninsured or under-insured are also less likely to visit doctors for minor problems. Instead, it is only when the problem becomes severe that they seek medical attention. And because they do not have family doctors, they seek care at one of the state’s charity hospitals or in the emergency rooms of private hospitals—two of the most expensive health care options. In fact, a visit to the ER costs 15 times more than a visit to a doctor’s office.”
“By putting more resources into preventive health measures,” Hood continues, “we can slow the growth in health care spending. Unisys is helping us do that by serving as our fiscal intermediary for Medicaid, where they are increasing efficiencies in our operations as well as implementing several programs that provide physicians with the tools they need to make informed decisions and deliver quality care.”
How Did the Department of Health and Hospitals Do It?
As the fiscal agent, Unisys processes all Louisiana Medicaid healthcare claims. According to Hood, Unisys processes approximately 50 million claims annually for the Medicaid program. "We've had a lot of satisfaction from the provider community with this system," Hood says. "While the federal limit on paying claims is 30 days, we're able to pay most claims in just seven." This claims data ultimately populates as informational data to validate decisions and provide faster insight to Medicaid’s programs.
One of the first programs Unisys implemented for Louisiana Medicaid was a new data warehouse in 2001. The warehouse comprises an ES2000 server that exchanges information with Medicaid's existing mainframe. The server processes information and builds reports, while the mainframe houses claims data as well as eligibility and provider information. By offloading processing from the mainframe, the data warehouse manages data far more quickly and saves approximately $500,000 annually in mainframe operation costs.
In addition, the data warehouse provides much needed decision support. In the past, reports on claims and trends took several weeks to compile. Today, data can often be retrieved within 24 hours, helping administrators identify and track trends and respond to them more quickly.
"We've had a lot of satisfaction from the provider community with this system. While the federal limit on paying claims is 30 days, we're able to pay most claims in just seven."
David Hood
Secretary of DHH
Following the success of the data warehouse, Louisiana Medicaid and Unisys introduced a peer-based profiling program in July 2002. This program takes advantage of the data warehouse to compare the prescription patterns of individual physicians. Pharmacy and medical specialists analyze the information to find anomalies in prescribing patterns. If they identify a physician who seems to prescribe certain drugs at a higher-than-average rate, the agency sends a comparison report to the physician. As Hood explains, “This educates doctors by allowing them to compare their profiles with those of their peers and take advantage of best practices.”
Perhaps more importantly, the program enables Louisiana Medicaid to manage expenses by reducing unnecessary prescriptions. The agency estimates that this program will save $2.6 million annually.
Another Louisiana Medicaid-Unisys initiative includes the launch of a secure Web site in February 2003. The site provides participating physicians with program information, manuals and additional resources such as recent prescription histories, and it gives Medicaid a tool for conducting online surveys of those physicians. This increases the availability of information while reducing distribution expenses for the agency.
"This program for the first time enables physicians to see what's going on with the patient and what treatments and prescriptions the patient has tried," says Hood. "The physician can identify prescriptions that may not be working well together, and they can see if other prescriptions have been given for the same illness. Getting this sort of information to physicians is essential to continuity and quality of care."
Louisiana Medicaid plans to extend this offering by the end of 2003 to provide patients' histories of physician visits, ER visits, in-patient and out-patient hospital services, labs, X-rays, childhood screenings, and other key information.
Finally, says Hood, “Unisys has been instrumental in our HIPAA compliance efforts. We met HIPAA deadlines, thanks to the work that Unisys has being doing.”
Results Delivered.
Preventive care. Reduced costs. Healthier citizens.
With data warehouse and supplemental systems developed and maintained by Unisys, DHH has been able to “empower physicians like never before,” Hood exclaims. “By giving doctors the tools to know what is going on with their patients, we are empowering them to provide preventive care.”
Additionally, Hood says that, “As a result of the work Unisys has done, Louisiana has become a low-growth state for Medicaid expenses. Since 1996, Louisiana’s Medicaid budget growth rate has been under four percent — the slowest in the United States. Previously, our growth rate was 30 percent; we had a mess on our hands, and Unisys has been instrumental in helping us clean up that mess.”
“It boils down to setting priorities. We have reduced costs and increased the quality of care,” states Hood. “We’re very proud of what we are doing, and Unisys has been our partner in helping us manage growth and work toward our ultimate goal of a healthier, happier citizen base.”
Customer at a glance
Louisiana Medicaid (administered by Bureau of Health Services Financing)
Reports to
Louisiana Department of Health and Hospitals
Mission
Finance and oversee access to comprehensive, quality health care to improve the health and life chances of Louisiana's most vulnerable citizens.
Objective
Improve outcomes and reduce costs by encouraging preventive, primary care.
Results
Earlier diagnosis. Better outcomes. Cost containment.
Population served
825,000 citizens
About Unisys in the Public Sector
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