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Data Analytics Tools Help Health Care Organizations Address Risks
Generating, collecting, and storing data — we all do it, and health care institutions are no exception. However, health care entities produce large amounts of sensitive data that are often captured in multiple, independent systems that lack the ability to link to each other. As a result, many health care organizations are unable to efficiently and effectively analyze their data and manage the associated risks.
Help identify risk
Data analysis tools help you evaluate and analyze most data populations, including the immense amount of financial transactions, patient records, and data from claims, collections, providers, and payers that are found in health care systems. These tools can help you use data to identify high-risk transactions and uncover additional areas of concern.
Inserting data analytics methodologies into monthly transaction cycles can help mitigate risks on an interim basis — and not just annually. Your stored data represents the comprehensive documentation of activities, and a possible treasure trove of insight into your organization’s performance. By plotting data trends for an extended number of years, data analytics can show a broader coverage than an annual financial report, which typically covers just two years.
Strengthen internal controls and confirm finances
Weaknesses in your systems can be addressed through strengthened policies and internal controls. After you identify and address any potential risks, the level of internal controls required by senior executives will also likely be more strongly supported and documented.
Robust, proactive, and ongoing data analytics can help prevent fraud, waste, and abuse before claims are paid, which can help save you the hassle of recovering mismanaged transaction amounts. To address disbursement risks, you will need to confirm that funds in your organization are being spent appropriately, and that assets are safeguarded. One way of cross-checking this information is comparing vendor and employee master files with each other and with external sources, such as the Office of Inspector General-excluded provider list.
If items such as billing, revenue coding, adjustments, and write-offs are identified risks, thorough data analytics can scrutinize your revenue data to look for anomalies or identify questionable activity. From there, you can isolate and analyze every transaction that possesses the suspect traits.
Improve financial data accountability
One convenient way of exploring and testing the use of data analytics in your organization is to initially focus on applying it to financial transactions. Using data analytics during financial statement examinations can provide health care organizations with guidance on software selection, staff training, computing capacity, project coordination, and evaluation of results.
Utilizing data analytics to reduce risk can also lead to improved financial management performance in areas such as revenue cycle, cash management, asset management, revenue forecasting, purchasing efficiency, human resources planning and management, and management of deferred maintenance. If fraud or abuse is detected in your analysis, your organization might even notice large savings following implementation of internal controls.
Once an initial staff capability is established, data analytics can help build financial analysis proficiency and reporting performance. Institutions just getting started should review the American Institute of Certified Public Accountants’ publication, Computer Forensic Services and the CPA Practitioner.
Help build transparency
Improving performance reporting through data analytics will permit institutions to mix and match a variety of statistics and tailor reporting to segments of stakeholders.
Data analytics is a cost-effective tool that can enhance an organization’s accountability, improve the strength of content in performance reporting, and increase transparency — all producing greater trust in institutional performance and improved health outcomes. It can even show how and where an entity can manage fraud risks and waste, improve efficiencies and effectiveness, and assist in decision making.
How we can help
To fulfill its function in our society, our health care system must have the trust of the people and be accountable to its many stakeholders. Our data analytics professionals can guide you every step of the way to develop your data analytics approach, and even provide a complimentary consultation to assess your organizational needs.