With his health care over­haul stalled, Pres­i­dent Barack Obama has chal­lenged Amer­ica to come up with alter­na­tives. “You got a bet­ter idea? Bring it on,” he recently announced. A tele­vised sum­mit meet­ing on health care ideas is sched­uled for Thurs­day, Feb. 25.

A sug­ges­tion. Why not focus on stream­lin­ing health costs by har­ness­ing tech­nol­ogy that allows com­pa­nies to take con­trol of their health­care expenses?

Busi­nesses gen­er­ally lack the data nec­es­sary to mea­sure and man­age their health costs, even though health care often rep­re­sents their sec­ond– or third-biggest expense. Indeed, exec­u­tives have a bet­ter sense of how much money they spend on office sup­plies than they do of where their health-plan dol­lars are going. But with the cost of health ben­e­fits pro­jected to increase 7 per­cent in 2010 — and to dou­ble over the next seven years — busi­nesses can no longer afford such will­ful ignorance.

Some firms have a stake in pre­serv­ing the costly sta­tus quo. Look no fur­ther than the insur­ance indus­try, whose top five com­pa­nies recently announced record prof­its that were 56 per­cent higher than last year’s. Insur­ers’ busi­ness mod­els are largely based on keep­ing Amer­i­can firms in the dark – that is, pre­vent­ing them from ana­lyz­ing their own health care data and using the results to find alter­na­tive ben­e­fit struc­tures that may offer bet­ter out­comes at lower cost.

Com­pa­nies have tack­led cus­tomer rela­tions and supply-chain man­age­ment with technology-driven strate­gies. So why not do the same for health benefits?

Such “health care per­for­mance man­age­ment” busi­ness strate­gies can alert com­pa­nies to expen­sive prob­lems within their ben­e­fits pro­grams — and then help them find ways to imple­ment money-saving fixes. The inno­v­a­tive tech­nol­ogy for doing so exists. It just needs to be adopted on a grand scale – and doesn’t require an act of Con­gress.

Although ben­e­fits are grow­ing ever-more expen­sive, most firms employ a lim­ited num­ber of tac­tics for trim­ming their health costs. They may tweak their plan design by adjust­ing the level of ben­e­fits employ­ees receive, forc­ing work­ers to pony up a bit more, or switch­ing to a dif­fer­ent provider. But these prim­i­tive approaches yield only mar­ginal sav­ings – at best.

Health care per­for­mance man­age­ment offers employ­ers an alter­na­tive. With HPM data, man­agers can see what is hap­pen­ing in their ben­e­fits plans – insight that used to be the exclu­sive prop­erty of insur­ance companies.

For instance, on an aggre­gate basis, busi­nesses could find out how many times the employee pop­u­la­tion has vis­ited the doc­tor in the past year and cor­re­late this infor­ma­tion to ensure their employ­ees are fol­low­ing the right treat­ment plans. What areas are show­ing the high­est poten­tial for future med­ical risks? Using that infor­ma­tion, man­age­ment could use tested soft­ware tools to imple­ment high-impact, low-cost mea­sures in response to patient risks — and achieve real sav­ings in the process.

Imag­ine if a seg­ment of a company’s work­force suf­fered from seri­ous but treat­able con­di­tions like a com­bi­na­tion of high blood pres­sure and high cho­les­terol with a fam­ily his­tory of dia­betes. Many of these patients don’t take their med­ica­tions appro­pri­ately or fol­low the courses of treat­ment pre­scribed by their doc­tors. Com­pa­nies can use real-time dash­board fea­tures to man­age these risk fac­tors pre­emp­tively – to the ben­e­fit of both work­ers and the com­pany bot­tom line.

For instance, employ­ers can link their work­ers up with spe­cial­ized “coaches” to help them pur­sue per­son­al­ized treat­ment regimes. These men­tors can inform patients about lower-cost med­i­cines or even pre­pare them to ask the right ques­tions at the doctor’s office.

Crit­i­cally, technology-driven HPM strate­gies also allow for strict pro­tec­tion of employee pri­vacy. Employ­ers sim­ply aggre­gate data and lean on third-party health care providers to engage their employ­ees. In other words, com­pa­nies pay the bills – but pri­vate med­ical deci­sions are han­dled exclu­sively by doc­tors and patients. Exec­u­tives don’t need to know who’s at risk – they just need to know that a risk exists.

HPM-driven cost trans­parency has already allowed many firms to save money on their health bills. One South Carolina-based long-term-care firm, for instance, saved 18 per­cent on its health care costs thanks in large part to insights gained from HPM data.

When health care becomes a coop­er­a­tive effort, work­ers ben­e­fit, too. A large Georgia-based radio sta­tion oper­a­tor reported that enroll­ment rates in its well­ness pro­gram nearly quadru­pled thanks to ini­tia­tives dri­ven by HPM data.

Pres­i­dent Obama came into office promis­ing the most tech­no­log­i­cally savvy admin­is­tra­tion in his­tory. Yet his health care plan vir­tu­ally ignores common-sense money-saving tech­nolo­gies that we use in all other aspects of our lives. It’s about time that changed.

George J. Pan­tos, Esq., is Exec­u­tive Direc­tor of the Health­care Per­for­mance Man­age­ment Insti­tute. He is for­mer Deputy Under­sec­re­tary of Com­merce as well as for­mer Gen­eral Coun­sel to the Self-Insurance Insti­tute of America.

Related posts:

1. I have a bet­ter idea, Mr. President
2. Self Insur­ance Health Facts
3. Stop Loss Insur­ance Is Not Health Insurance