Wakely Risk Insight (WRI)

Understanding Profitability in the Individual and Small Group (ACA) Markets

It is impossible to manage what you cannot measure, and measuring performance in the risk adjusted environment is now more challenging than ever. We used to be able to look at drives of cost in order to gain insight into the experience. In a risk adjusted environment – drivers of profitability can be counter intuitive, for example the older sicker and costlier individuals may actually be improving the financial performance of the plan than vice versa. 

WRI performs two key functions. It allocates important financial items such as risk adjustment transfers, fees and taxes, etc. at the member level. Secondly, it applies a sophisticated slicing and measuring algorithm to isolate drivers of profitability for further analysis. 

Allocation and Segmentation

One of the keys of WRI is the allocation of key financial amounts (e.g. taxes, fees, risk adjustment transfers, other adjustments) at the member level. The member-level file with allocated amounts is available to the client as well. Once amounts are allocated, a sophisticated algorithm similar to a decision tree searches through various member segments to calculate their relative importance in driving plan profitability.  

Informed by Unique Data Assets

Wakely has unique data assets including one with over ten million ACA lives. We have crafted key regional benchmarks that are included in the WRI exhibits for comparison. 

Analyzing Drivers of Profitability

In the WRI analytics, we examine a number of hypothesis to see if there are any obvious drivers of profitability for a given health plan. The standard set that we test includes demographics, metallic tiers, medical conditions or HCCs, rating area, quartiles of cost, etc. In addition, we have the flexibility to test client-specific inputs such as profitability by acquisition channel, providers, hospital networks, etc. 

Next Step

For more information on WRI or to schedule a 30-minute discussion/demonstration, please contact Products@Wakely.com.