Health Plans

How CMS’s interoperability mandate reduces healthcare costs and improves member experience

Feb. 11, 2021 | Article |

How CMS’s interoperability mandate reduces healthcare costs and improves member experience

For health plans, data interoperability is accelerating digital transformation and will help pave the way for a seamless virtual and in-person care experience. As business processes are digitized and integrated into an interoperable data lake, new, member-facing digital apps will be far easier to bring to market. The Centers for Medicare & Medicaid Services’ (CMS) Interoperability and Patient Access Rule has a role in accelerating this digital transformation.


Under the new mandate, health plans will give patients access to their data via a Fast Healthcare Interoperability Resources-based API, free of charge, starting July 1, extended from the original date of January 1 due to COVID-19. The CMS rules around data sharing will apply to Medicare Advantage plans, state Medicaid and Children’s Health Insurance Program (CHIP) agencies, and insurers that offer qualified health plans, or Medicaid and CHIP managed care plans. Payer-to-payer data exchange based on the data classes defined within the United States Core Data for Interoperability will be required starting January 1, 2022.


Health plans should look at the interoperability mandate not as a compliance requirement, but rather as a strategic opportunity to get a competitive advantage. Members now expect well designed, omnichannel digital experiences, and health plans can leverage the new, real-time data sources enabled by the interoperability mandate to reduce overall healthcare costs and improve member experience. It’s a unique opportunity to activate and engage members where they are in their care journey.


Here are the interoperability mandate’s biggest benefits for health plans:  

  • Cost reduction: Health plans can reduce administrative costs by eliminating manual processes embedded in quality metrics reporting, and evaluate integrated medical claims, clinical, pharmacy, dental and consumer data with socio-economic and social determinants of health to improve health outcomes and reduce care costs. The data and insights can be shared with members to improve medication adherence and chronic disease management, thus giving health plans better return on investment.
  • Optimized care delivery through clinical data integration: A longitudinal view of all member medical consultations and treatments will help clinicians predict patient needs and health plans align with their members’ medical and financial requirements. Leveraging alternate treatment options with digital technologies in virtual and in-person care settings and coordinating care among stakeholders will make care delivery better and more efficient as health data ownership clearly stays with members.
  • Omnichannel, orchestrated member experience: As noted above, member expectations for digital healthcare experiences are higher now, on par with their expectations for banking, retail and entertainment services providers. Health plans have a unique opportunity to hyper-personalize the member experience by leveraging the interoperability mandate to remove data silos. Member insights derived from integrated, interoperable data along with the right channel, content and communication cadence will help create an orchestrated, omnichannel member experience. 
  • Improved risk stratification: Risk stratification is traditionally calculated through demographic, medical and prescription data and a health risk assessment. Traditional risk stratification approaches are dependent upon the member’s responses, leaving room for subjectivity and incomplete health histories. The CMS’s Interoperability Rule, on the other hand, requires six years of data for each member, and health plans can get member consent to leverage their data while giving them access to it. Having this longitudinal health record available at the time of enrollment, along with real-time claims data, will improve actuarial and underwriting in the risk management process. Accurate and complete diagnosis and risk score coding is critical to the success of any Medicare Advantage plan or arrangement that’s based on risk-adjusted metrics.
  • Better ROI from population health management and value-based care initiatives: While the Interoperability Rule doesn’t specify population health management (PHM) or value-based care capabilities to meet compliance, leading health plans are planning to leverage interoperability data to identify care gaps, enhance clinical and administrative decision making, improve member outcomes and reduce costs. A few select health plans are identifying a means to integrate their PHM systems with interoperability to develop advanced analytics and create personalized care plans for the high-risk, chronically ill member population.

The CMS Interoperability Rule isn’t merely a compliance issue. The new mandate presents an array of opportunities for creating value across the health plan landscape. By taking full advantage of these opportunities, health plan leaders can create value for their members and for their organizations.

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