Encounter Data Initiative
One common risk-based payment method—long used in California but less common elsewhere—is capitation. Under capitation, providers receive prospective per member, per month payments to provide all contracted patient care instead of filing piecemeal fee-for-service claims for individual services after the fact. In lieu of claims data, health plans using capitation rely on patient encounter data to track health care quality and costs and to adjust provider payment levels.
Complete, timely and accurate encounter data are critical to risk-adjusting provider payments to account for health differences in patient populations enrolled in California HMOs. Yet, provider payment incentives, multiple data handoffs and variation in data collection hamper exchange of encounter data among contracting parties, ultimately impacting HMO enrollment.
To increase understanding and identify potential solutions, IHA has launched a multi-stakeholder initiative to assess market challenges and develop potential solutions, and is currently working with stakeholders to develop ways to standardize encounter data exchange processes.
As evidence that standardizing encounter data is a statewide imperative, the California Department of Managed Health Care recently proposed an approach for the industry to standardize encounter data submissions across all lines of business as a requirement for the recent approval of the Blue Shield of California acquisition of Care 1st.
IHA’s initial assessment of encounter data in the current California environment and production of the issue brief was funded by the California HealthCare Foundation.