Monday, November 16th
8:15 a.m. - 9:15 a.m.

Keynote Address: Transforming the Insurance Organization Through Technology

-- Richard L. Huber, Aetna Inc., Chairman, CEO, & President

"Aetna Chief Discusses Industry Challenges Ahead"

By Lee McDonald
Executive Editor

The next wave of health-care reform will come as companies use their own data to make coverage and treatment consistent across state and national borders, the chairman of Aetna Inc. told insurers on Monday.

Richard Huber called variations among treatments in different states "bizarre." For instance, New York area members of Aetna's system generate 50% more bed days per person than comparable members in Los Angeles. Kentucky residents have a 50% higher chance of undergoing radical prostate surgery than someone in New Orleans. Doctors in the southeastern United States issue prescriptions twice as often as doctors in the northeast, Huber said.

Huber was the keynote speaker Monday at "Fulfilling the e-Promise," A.M. Best Co.'s 11th-Annual insurance information conference, held this year in Boston.

Huber said he and Aetna's employees resent the managed-care bashing now common among lawyers and the press. But even if national health reform ever takes root, he still sees a place for national health insurers such as his company.

"We're a financial intermediary. We don't take anybody's temperature or change any bedpans or give any shots," Huber said. "Whatever evolves, there will be a role."

Huber called the growth of managed care the first revolution in health-care cost containment. The second involves intensive "data mining" or electronic sifting of claims records to determine what treatments work and what patients should receive attention earlier to prevent later, more expensive medical treatment and complications.

Aetna now has 16 million health care members and employs 300 people full-time to uncover patterns among the usage data. He said the dataminers work with "derivatives" based on reported claims, not on individual health records.

Because of that work, Aetna now checks its own daily prescription orders and provider claims to flag diabetics and asthma sufferers. Those patients' doctors are then contacted and treatment is reviewed. Making sure doctors provide appropriate, state-of-the-art treatment for patients with these ailments early on reduces later complications and hospitalizations, Huber said.

Huber, whose career started in banking, in recent years has helped focus Aetna on its health-care and retirement businesses. He's also overseen the consolidation of 14 separate computer systems into one database.

But Aetna is still working to remake its work processes from the ground up, a battle that will take years. "We found that technology basically paved the cow paths," he said. " We were automating workflows that really hadn't changed in over 100 years. We substituted high-speed printers for guys who used to sit on tall stools."

Each day, the company processes 650,000 health claims and 275,000 customer phone calls. In 1996, Aetna acquired U.S. Healthcare, the large HMO company. One reason to buy US Healthcare was the managed-care company's state-of-the-art computer system.

One consequence of the acquisition: Aetna shelved an in-house project to build its own company-wide computer system. "I'll never ever build a new system from scratch again," Huber told the audience of insurance technologist and managers.

"Health care delivery in this country is the largest cottage industrial in the world, Huber said. "It's a trillion-dollar industry with no standards, no outcomes information. Once a doctor gets his degree, that's it, he goes out and practices medicine. There are very few feedback tools. We're bringing those tools."