What is Predictive Modeling in Healthcare

What is Predictive Modeling?

Healthcare payers can use predictive modeling in healthcare many ways in a population health approach. Predictive modeling is the application of mathematical models to predict an outcome, such as the potential cost or risk associated with managing a specific patient population. Predictive modeling in healthcare can be used at the population level. It can also be used to stratify members into different tiers of potential cost to identify those who would likely return the greatest return on investment (ROI) from a care management program. Predictive modeling in healthcare can be used to anticipate costs and choose between pay-for-performance programs to reward physicians for better quality of care.

Predict High-Risk Members

To some extent, the past predicts the future. Claims, pharmacy and demographic data can be mined with predictive modeling to identify sources of risk, allowing payers to create targeted interventions. For example, members with chronic diseases may incur a substantial future utilization of resources, such as hospitalization. Interventions also incur cost. Thus, a high-risk patient may be assigned to a personal health coach, while a lower-risk patient might be assigned to an outreach campaign and web-based tools.

Insight for Pay-for-Performance Programs

Predictive modeling can also be used to influence care providers. Pay-for-performance (P4P) programs can be used to change provider behavior, improve care quality and lower population risk. Managing multiple pay-for-performance (P4P) contracts is becoming increasingly complex. McKesson Risk Managerâ„¢ calculates and tracks clinical measures based on your criteria, allowing physicians and networks to track their scores throughout the year and improve patient care to meet performance-based incentive payment goals. Tools manage the full range of advanced P4P metrics, including generic prescribing rates, ED visits, days/1000 and more. Full adjudication functionality enables payers to calculate P4P payments and export the data to accounting systems.