Health Insurance Underwriting Practices With Prescription Data – How Does This Work
Posted Jun 24 2009 10:43pm
Somebody brought up this question the other day on how do insurance companies get your medication information. The information below goes back to a post I did about 3 months ago on the two main companies that provide the information for the insurers. I’ll add a little bit more this time to perhaps explain a little better about the process. In order to qualify for insurance your medication records get evaluated. You will need to sign a HIPAA form allowing the company access, otherwise chances are if you don’t, you may not be given approval to be covered, kind of how the process works.
It was not until recently when the FTC investigated and stated that both companies need to provide a copy of the analysis they provided to the insurer to you, so you could see how your medications were analyzed and if you were in the “red”, “yellow’ or “green” zone, just like a stoplight. Of course anyone taking cancer drugs sticks out like a sore thumb, so anyone taking some of the drugs will be scrutinized. Read this next sentence very carefully, you sign a HIPAA statement to give access but that seems to be where HIPAA somewhat begins and ends.
“HIPAA does not give theDepartment of Health and Human Servicesthe ability to directly investigate or hold accountable entities, such as pharmacy benefit managers or companies such as Ingenix and Milliman, who are not covered by HIPAA.”
“Does this process make it more difficult for consumers to get insurance? No. There is nothing new about consumers authorizing the release of their medical records, including prescriptions, to insurers. This standard process has been in place for decades, helping insurers make good decisions about rates and insurability.”
There’s also a flash presentation where you can view the process here.
“By increasing understanding of potential disease conditions and relative risk, MedPoint enables underwriters to more accurately project future claims costs on a case-by-case basis.”
Again, I am attempting to share some information here to create an awareness of how this all comes together so consumers are not in the dark. When you look at the information presented you can see that the big emphasis of course is on cost and this is being calculated with “business intelligence” software with algorithms created for decision making processes. It is some very detailed data.
The only way to stay out of the radar is to usually get a $4.00 generic prescription filled and pay cash without using a discount or club member card. This will also come back to potentially haunt your physician though as they undoubtedly get hammered as to why certain patients are not taking their medications. They hear it all the time when data is not available for tracking and affects their pay for performance bonuses, which most just write off anyway as their primary concern is patient care, big reason why the physician/patient relationship is so important You can read more at the link below.
For information outside the realm of medications, there’s the MIB where most carriers share patient information.
The link below is also very informative with addressing the de-informationing of data in data bases which is being done more commonly today, but also addresses the fact that all it takes is a query connected to another data base to find a match. That part I know about having written programs and SQL code and it’s not hard to do once you determine which unique identifier column you will need to use from the tables.
Anyway, I hope this answers the question posed on where the information comes from, how it gets used, and most importantly how pharma medication data bases do not fall under the auspices of HIPAA as some may think. The data bases have been accumulated and updated for years before electronic medical records came around and likewise information from them has been sold as well as giving pharmaceutical representatives the data they need to sell by being able to identify the physicians writing prescriptions and for which drugs. Now that they represent a valuable module in a healthcare records, it will be interesting to follow the progress and see if rules, laws, regulations and paradigms will change.
Just like data used in any business today, the data is feeding far more areas and not just used for internal operations, but widely spread through out healthcare and matched and analyzed with other relative patient data that constitutes an electronic medical record. This is an example of “business intelligence” so if you have heard that term on mining and analyzing data this is one example on how information is used. BD
With the Ingenix story in the news the last few weeks, there are a couple of other data sources out there that are used to mine your medication and health records data. Part of the reason that is is all coming to light is due to the fact the data is now trying to be used in a constructive basis, for good healthcare and with all of this comes out what’s being going on somewhat behind the scenes for years. The data bases have been sold for years for risk management purposes and do not fall under HIPAA.
Milliman's Intelliscript or Ingenix Medpoint are the 2 big data miners that find out when you apply for health insurance what your medication rap sheet has been for the last 5 years. By applying for insurance, you sign a release to allow the companies to mine the information, no signature and permission, then probably no insurance will be written for you; however, the release you sign is HIPAA compliant, whatever that constitutes at this point.