Why your health plan needs Sabermetrics
For too long, most every decision about your health plan has been made with a gut feeling.
DRS, OPS+, and WAR. What do these acronyms stand for? Chemical elements on the periodic table? Short-hand text communication used by millennials? No, these are stats used by organizations to scout the talent pool in Major League Baseball. They are a part of a new-wave of data analytics taking over the sport known as Sabermetrics.
One doesn’t have to go that far back to remember a time when players were scouted on the “eye test.” Yes, scouts measured pitch velocity and 60-yard speed, but an athlete’s size, power, and raw talent played a major factor in an organization’s willingness to take a “flier” on a ball player. That’s probably why I was never drafted and, instead, signed as a free agent. A 5’9″ height doesn’t garner much interest when you’re a pitcher!
However, things have changed. Turn on SportsCenter today, and Batting Average and Earned Run Average (ERA) no longer dominate the box scores. Today, an individual’s stats include Defensive Runs Saved (DRS), On-Base Percentage plus Slugging Percentage (OPS+), and Wins Above Replacement (WAR). You see, baseball is now a sport driven by data. Sabermetrics has transformed baseball into a sport where “gut feeling” decisions have been replaced with empirical analysis. The eye test is no longer good enough.
Sabermetrics has allowed small-market teams to compete with the giants of the sport, like the New York Yankees. Data trumps payroll. Just ask the 2003 Oakland A’s, who made the playoffs despite having one of the smallest payrolls ($44M) in baseball. You see, having access to the right data creates opportunity. Data opens the door for smarter decision making. Enter your health plan.
For too long, most every decision about your health plan has been made with a gut feeling; an eye test of sorts. Everything from the choice of insurance carriers, plan designs, and employee health care decisions has been driven by everything but data. Insurance carriers are often chosen on size instead of one’s ability to reduce health care costs.
Plan designs are often picked based on premium projections instead of a plan’s ability to help employees access high-quality care at a low cost. Employee health care decisions are often made based on a friend’s recommendation or the magnificent beauty of a healthcare facility instead of using cost and quality statistics (which we know has been impossible for consumers to obtain). As a result, your gut feeling and your employees’ eye tests have led to your inability to control the healthcare budget. Yet, that all can change when you use data to drive decision making. Your health plan needs Sabermetrics.
When you start designing health plans around the right data, outcomes are created. When you are able to evaluate health care facilities through cost and quality metrics, you can begin driving employees to the right place for the right kind of care and reward them with $0 access. When you are able to analyze the cost and quality of the medications within your plan, you can start helping your employees access those same medications at significantly reduced prices (and again reward them with $0 access). However, nothing happens without the data and if you’re not getting the right kind of data, it’s time your start demanding to see it. (DISCLAIMER: Yes, I know a fully insured plan is unable to get the right data.)
If we are honest with ourselves, we know that it’s going to be very difficult to change health care system-wide. There are too many hands in the proverbial cookie jar. However, we can ABSOLUTELY change it one employer at a time. But, successful change requires data. Gut feelings must be replaced with empirical analysis. No longer let your employees navigate the health care system using the eye test. They have a ton of raw talent for making accurate health care decisions but they need the right tools driven by the right data.
If Sabermetrics can turn an underdog, like the 2003 Oakland A’s, into a playoff contender, just imagine what data analytics can do for the certainty and predictability of your healthcare budget. Bring Sabermetrics to your health plan and watch your outcomes soar!
Andy Neary is a nationally known strategist and best-selling author for employee benefits and healthcare, with more than 15 years of experience helping employers address the rising cost of healthcare through innovative strategies. As a former professional pitcher with the Milwaukee Brewers, Neary understands the hard work and daily grind needed to perform at the highest level. He takes the same approach to his work in benefits, working through that daily grind to create truly elite benefit programs.