Running head: MEMBER DATA EXCHANGE 1

Medicare Advantage Member Data Exchange

Nina Naples

University of San Diego

MEMBER DATA EXCHANGE 2

Executive Summary

The Blue Cross Blue Shield Association (Association) is focused on the success of the

Blue Cross Blue Shield Plans (Plans) collectively and individually in order to benefit those they

serve. The Association has been tasked with the development of the Medicare Advantage

provider data exchange. This project will provide a new care management approach for the Blue

Cross Blue Shield Plan’s out of area Medicare Advantage group PPO members including

reducing gaps in care, improving member and provider experience, improving Star ratings and

increasing risk score accuracy, enabling market competiveness and affordability, and aligning

incentives (BCBSA, 2019e). The provider data exchange will allow the Medicare Advantage

member’s home Plan to submit a request through the provider data exchange to the member’s

host Plan. The host Plan will then contact the member’s provider to receive their medical records

and submit them through the provider data exchange. This will let the home Plan review and

close the member’s gaps in care (BCBSA, 2019d). The board has mandated that all thirty six

Plans across the nation must participate in the provider data exchange.

Blue Cross Blue Shield ranked forth in Medicare Advantage enrollment out of the major

insurers. The Blue Cross Blue Shield system developed a marketing plan to increase their

competitiveness in the Medicare industry by launching the Benefit of Blue. This is a national

Medicare awareness campaign to highlight and promote all thirty six Blue Cross Blue Shield

Plans Medicare offerings (BCBSA, 2019b).

This project has been budgeted out of the Association’s government programs funding

with a start-up cost budget of $1,789,000 for the entire project. The projected gross profit is

$2,265,000 with a projected net income of $510,000. This is due to the fact that consumer

consideration increased during market testing (BCBSA, 2019c).

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Company Overview

Blue Cross Blue Shield is made up of thirty six individual Blue Plans that are governed

by an association that manages the brand, licenses, polices, and Plan data. One of the

Association’s goals is to enhance the values of the Blue Cross and Blue Shield brand to support

Plan’s growth and ensure the private healthcare market provides quality, accessible, and

affordable healthcare for all Americans (BCBSA, 2019f). Blue Cross and Blue Shield

Association is comprised of multiple departments, such as commercial markets, finance, brand,

strategic services, office of policy and representation, office of clinical affairs, information

security, and enterprise technology services.

The Association’s mission statement is “to enable the success of Blue Plans collectively

and individually in order to benefit those they serve” (BCBSA, 2019f, para. 1). The values are

stated as, “we believe that our mission is best achieved when we operate and are guided by a

strong belief in our values. We strive to create and maintain a work environment that is

conducive to our personal growth and development, and allows us to contribute to our greatest

capability. Our behavior, efforts and the way we interact with our customers and colleagues are

focused on the following values: commitment, integrity, collaboration, leadership, and

innovation” (BCBSA, 2019f, para. 2).

The Blue Cross and Blue Shield Association has been tasked by the board with a strategic

initiative to develop a provider data exchange to assist Plans in care management for Medicare

Advantage (MA) out-of-area members. Currently, the Association offers Plans a data exchange

for non-Medicare programs in order to serve national accounts, local value-based programs are

delivered nationally through Plan-to-Plan data exchange capabilities and financial agreements

(BCBSA, 2019c). The business value associated with building a data exchange for Medicare
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Advantage out-of-area members for care management includes reducing gaps in care, improving

member and provider experience, improving Star ratings and increasing risk score accuracy,

enabling market competiveness and affordability, and aligning incentives (BCBSA, 2019e). The

proposed provider data exchange will allow the Medicare Advantage member’s home Plan to

submit a request through the provider data exchange to the member’s host Plan. The host Plan

will then contact the member’s provider to receive their medical records and submit them

through the provider data exchange. This will allow the home Plan to review and close the

member’s gaps in care (BCBSA, 2019d). The development of this newly designed collaborative

model is intended to improve Star scores, ensure appropriate risk adjustment, meet market

expectations and increase the effectiveness of members’ care management.

Business Description

The development of the Medicare Advantage provider data exchange will provide a new

approach for care management and provider engagement of out of area Medicare Advantage

group PPO members. This new Plan-to-Plan arrangement is designed to enhance the way Blue

Plans support Medicare Advantage Group PPO accounts and their members who live outside of

home Plan service areas. All thirty six Blue Plans across the nation must participate in the

provider data exchange. Blue Plans are defined as a home Plan for their local members and a

host Plan for their out of area members. This platform allows home Plans to receive information

on their out of area members who live or have traveled to and received care in another Plans

service area. Blue Cross Blue Shield currently has a value-based programs data exchange

product for non-Medicare members. The market need for a data exchange platform for Medicare

Advantage has significantly increased in the recent years.

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To operationalize capabilities for medical record retrieval and provider

engagement/communication on Stars care gaps and risk adjustment gaps, Plans will use the

Provider Engagement Exchange (PEX) platform to allow: home Plans to submit requests for

medical records, Stars care gap closure, and risk adjustment gap closure, and host Plans to

receive and respond to the requests (BCBSA, 2019d). To enable the exchange of request

information, the provider data exchange platform will leverage the out of area MA group PPO

member demographic data submitted to the National Data Warehouse (NDW) by home Plans, so

BCBSA can enrich the request with data that assists host Plans in preparing for provider

engagement (BCBSA, 2019d). The provider data exchange requests are then validated against

NDW data to ensure that requests are for MA group PPO members (BCBSA, 2019d). The

requests and responses are submitted through the managed file transfer process using JavaScript

Object Notation (JSON) format files. The provider data exchange platform as a whole is a very

technical process.

The development of the Medicare Advantage provider data exchange will rely on many

teams at Blue Cross Blue Shield Association. The key team contributors are government

programs, program delivery, national data warehouse operations and enterprise information

technology. These teams will work together to deliver this solution to the Plans.

While this project does not require approval from the FDA, it follows the CMS, NCQA

HEDIS and Stars care gaps and risk adjustment gaps for Medicare Advantage members. This

project has been budgeted out of the BCBSA government programs funding with a start-up cost

budget of $1,789,000 for the entire project. The commercial markets department will receive

$250,000 of the budget. The team has discussed potential enhancements for a second generation

to improve the system, such as reporting and performance outcomes, but they have not been
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approved (BCBSA, 2019d). These enhancements can usually be estimated around ten thousand

dollars. While this is a large project, the benefit to out of area Medicare Advantage group PPO

members remains necessary.

Market Analysis

The amount of Medicare Advantage beneficiaries has nearly doubled in the past decade

(Damico et al., 2019). There are now 22 million Medicare beneficiaries enrolled in Medicare

Advantage plans (Damico et al., 2019). The total Medicare Advantage enrollment from 2018 to

2019 alone grew by about 1.6 million beneficiaries (Damico et al., 2019). With such a significant

increase in beneficiaries, Blue Cross Blue Shield realized the need to increase their competitive

edge in the Medicare market.

Blue Cross Blue Shield’s two largest competitors for Medicare Advantage enrollment are

United Healthcare and Humana (Damico et al., 2019). Of the Medicare Advantage enrollees

nationwide United Healthcare has 26% of enrollment, Humana has 18%, and Blue Cross Blue

Shield has 15% (Damico et al., 2019). The Blue Cross Blue Shield’s provider data exchange is

only focusing on a subset of Medicare Advantage beneficiaries. Their target market are their out

of area Medicare Advantage group PPO members (BCBSA, 2019e). Group plans are offered by

an employer who has a contract with an insurer where Medicare pays the insurer a fixed amount

for each enrollee’s benefits covered by Medicare (Damico et al., 2019). One in five Medicare

Advantage enrollees are part of a group plan (Damico et al., 2019). This results in about 200,000

members, across the Blue Cross Blue Shield Plans, who are eligible to participate in the provider

data exchange (BCBSA, 2019a). The Blue Cross Blue Shield system developed a marketing plan

to increase their competitiveness in the Medicare industry by launching the Benefit of Blue. This

is a national Medicare awareness campaign to highlight and promote all thirty six Blue Cross
MEMBER DATA EXCHANGE 7

Blue Shield Plans Medicare offerings (BCBSA, 2019a). The multimedia campaign includes print

ads and TV commercials, which has increased consumer consideration by 40% in testing

(BCBSA, 2019a).

While all thirty six Blue Cross Blue Shield Plans across the nation will participate in the

provider data exchange, the Plan with largest market of out of area Medicare Advantage group

PPO members is Blue Cross Blue Shield of Michigan with almost 75,000 members (BCBSA,

2019a). Blue Cross Blue Shield of Michigan is then followed by the Anthem and Highmark

Plans, with around 30,000 members each (BCBSA, 2019a). By identifying the market

segmentation, Blue Cross Blue Shield has clearly defined their target market of out of area

Medicare Advantage group PPO members. As well as, completing a SWOT analysis to define

the projects current environment in terms of strengths, weaknesses, opportunities, and threats

seen in figure 1.

Blue Cross Blue Shield’s most prominent strength in the industry is that their business is

nationwide and has 109.4 million members enrolled system wide (BCBSA, 2019f). Mandating

that all Blue Cross Blue Shield Plans must participate in the provider data exchange gives the

program the advantage of being nationwide and reaching more Medicare Advantage members.

The strengths for the provider data exchange are reducing gaps in care, improving member and

provider experience, improving star ratings and increasing risk score accuracy, enabling market

competitiveness and affordability, and aligning incentives (BCBSA, 2019e). These capabilities

and improvements are how the system is continuing to develop and maintain a loyal customer

base.

The provider data exchange’s main weakness is the implementation and system size. The

technical components of developing and implementing the provider data exchange is complex
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and time consuming. While having all thirty six Blue Cross Blue Shield Plans participate in the

provider data exchange is a strength for the members, it can also causes weaknesses in the

amount of time it takes for approval from such a large board. Strategic decisions can sometimes

be difficult to make because what may be good for the larger Plans, such as Anthem and HCSC,

may not be as good for the smaller Plans, such as Blue Cross Blue Shield of Rhode Island.

Although it can be challenging, these strategic decisions have to be made considering the best

outcome for the Plans and members.

In order to get the program implemented as fast as possible, strategic decisions

sometimes have to put developing and implementing some of the capabilities on hold. This

however provides the program with opportunities to continue to improve for the members. These

capabilities will be implemented as enhancements in a second generation update of the program

(BCBSA, 2019d). Some of the enhancements are provider incentives for risk-based quality of

care programs and member support for palliative care (BCBSA, 2019d). These enhancements are

currently being discussed but have not been approved yet. The project manager tracks all

enhancements, budgets and timelines for the project. This allows Blue Cross Blue Shield to stay

up to date on industry trends and continue to innovate.

The biggest threats to the provider data exchange are competitor action and

environmental effects. Many of Blue Cross Blue Shields competitors are able to act fast and

quickly innovate with the industry trends due to their system’s size. This can threaten Blue Cross

Blue Shield’s market competitiveness if they are unable to act and make decisions as fast. Most

recently the environmental effect of the global pandemic has also threatened the implementation

of the provider data exchange. The Blue Cross Blue Shield Association and all Plans had to
MEMBER DATA EXCHANGE 9

quickly change their focus from program implementations to the pandemic, which has threatened

the programs timeline.

Figure 1.

STRENGTHS WEAKNESSES
 System Mandate  System size
 Nationwide  Complex technical
 Reducing gaps in care components
 Improving member and  Challenging development
provider experience  Time consuming approval
 Improving star ratings process
and increasing risk score SWOT
accuracy
 Enabling market
competitiveness and
affordability
 Aligning incentives
OPPORTUNITIES THREATS
 Added capabilities  Competitor action
 Enhancements  Environmental effects
 Industry trends

Operating Plan

The provider data exchange’s roll out plan will be implemented within three phases. The

three phases are system analysis, testing and integration, and deployment. The system analysis

phase will consist of the business and technical teams working together to build out the

requirements documents and mapping guidelines. The organizational chart for the business and

technical teams are shown in figure 2. This phase will last for 3 months but will continue

throughout the testing and integration phase making modifications as necessary. This phase will

also include the information security team to ensure all security requirements are included, such

as masking personal health information fields, before moving forward to phase two. Since the

data is not stored on the Association’s platform there is no need for the information security team

to implement a disaster recovery process in the requirements.

MEMBER DATA EXCHANGE 10

The testing and integration phase will consist of the technical build out of the provider

data exchange, along with testing. The Association uses an agile approach for technical build

outs, meaning that the technical teams plan the project in sections to test and present them to the

business teams. The main technical components to operationalize the provider data exchange are

home Plans submitting requests for medical records, Stars care gap closure, and risk adjustment

gap closure, and host Plans receiving and responding to the requests (BCBSA, 2019d). To enable

the exchange of request information, the provider data exchange will use the out of area MA

group PPO member demographic data submitted to the National Data Warehouse (NDW) by

home Plans. BCBSA’s technical team will then enrich the request with data that assists host

Plans in preparing for provider engagement (BCBSA, 2019d). The provider data exchange

requests are then validated against NDW data to ensure that requests are for MA group PPO

members (BCBSA, 2019d). The requests and responses are submitted through the managed file

transfer process using JavaScript Object Notation (JSON) format files.

The last phase is the deployment phase. This phase is when the Association will work

with the Plans two implement and execute the provider data exchange. The execution phase will

take place during the first two weeks of the 12th month. This portion take time to complete since

all thirty six Plans are implementing. The third week will consist of the verification portion of

deployment to uncover and fix any defects during implementation.

There are many stakeholders involved with the development and implementation of the

provider data exchange. The government programs team owns the project at the Association and

they work with many other teams to manage this project. Some of the stakeholders outside of the

Association are the Blue Cross Blue Shield Plans and the out of area Medicare Advantage group

PPO members. The unique skills of some of our key employees are the technical skills to build
MEMBER DATA EXCHANGE 11

the data exchange and the employees with years of Medicare experience. This project does not

directly affect the facility for the Association’s office. The Association’s office is leased in the

city of Chicago with four years left on the lease. Leadership will reevaluate the lease to

determine if they will resign or move locations.

Figure 2.

Marketing and Sales Plan

The key message for the out of area Medicare Advantage group PPO members is that the

provider data exchange will reduce gaps in their care, improve member and provider experience,

improve quality star ratings and increase risk score accuracy, enable market competitiveness and

affordability, and align provider incentives (BCBSA, 2019e). This program is a new approach to

improve care management and provider engagement. It is also designed to enhance the way Blue

Plans support Medicare Advantage group accounts and members (BCBSA, 2019d).

The Blue Cross Blue Shield Association and Plans developed and launched a marketing

campaign called the Benefit of Blue to increase their market competitiveness in the Medicare

industry. This is a national Medicare awareness campaign to highlight and promote all thirty six

Blue Cross Blue Shield Plans Medicare offerings (BCBSA, 2019a). The Benefit of Blue is a
MEMBER DATA EXCHANGE 12

multimedia campaign that includes print ads and TV commercials. The print ads have appeared

in magazines such as Real Simple, Time and National Geographic. The commercials have been

featured on major networks such as ABC, CBS and NBC. As well as popular cable channels

including HGTV, ESPN and Hallmark (BCBSA, 2019a). These advertisements have increased

consumer consideration by 40% in testing (BCBSA, 2019a).

Financial Plan

The provider data exchange project has a wide range of skilled employees. The main

teams on this project are government programs, program delivery, enterprise project

management office, information technology, information security. These employees cover

multiple different areas within the company, such as business execution and information

technology. The employees also have a variety of professional experience allowing for open

discussions and innovation. The staffing salaries have been outlined in the start-up cost

projections for the year in figure 3.

The estimated first year start-up costs and budget for the provider data exchange is

$1,789,000. The funding for the projects stems from board approval deeming the project

necessary for Plans. The funding is then allocated to the government programs budget.

Therefore, outside funding is not necessary. The budget consists of cost items for

administrative/general, development, marketing, labor expenses, and other. The

administrative/general costs comprise of legal, business consultants, and information security

assuming that all vendor commitments are followed through. The development costs are for

systems analysis which entails requirement documents and mapping guidelines, testing and

integration, and deployment which involves project execution and verification. The cost for

marketing is mostly provided by the Blue Cross Blue Shield Plans, but the Association covers
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costs for travel, some internet/web marketing, and networking events with the Plans. The travel

costs are under the assumption that a few Plans may need assistance during testing or

deployment from Association staff. The labor expenses consist of salaries and training for staff

development. The other category comprises a small miscellaneous budget for a launch party or

reserve funds if needed. Lastly, after completing the projected profit and loss spreadsheet, figure

4, the projected gross profit is $2,265,000 with a projected net income of $510,000. This is due

to the fact that consumer consideration increased during market testing (BCBSA, 2019a).

Figure 3.

START-UP COSTS – BCBSA PROVIDER DATA EXCHANGE

COST ITEMS DATE DUE BUDGET ACTUAL UNDER/UNDER
 
ADMINISTRATIVE/GENERAL
Legal 10,000
Business Consultant (Vendor Commitments) 38,000
Information Security 20,000
Miscellaneous
DEVELOPMENT
System Analysis (Requirements & Mapping
100,000
Docs)
Testing & Integration 150,000
Deployment (Execution & Verification) 250,000
Miscellaneous
MARKETING
Travel 2,000
Internet/Web marketing 10,000
Networking events 8,000
Miscellaneous
LABOR EXPENSES
Payroll (Salaries, bonus payout, merit
1,000,000
increases, etc.)
Training/Staff Development 200,000
Miscellaneous
OTHER  
Miscellaneous (Contingency reserve/launch
  1,000
party/etc.)
$1,789,00
ESTIMATED START-UP BUDGET    
0
MEMBER DATA EXCHANGE 14

Figure 4.

PROFIT AND LOSS

                         
SHEET TEMPLATE
BCBSA Provider Data
DECEMBER 15, 2019
Exchange
 

MA
REVENUE JAN FEB APR MAY JUN JUL AUG SEP OCT NOV DEC YTD
R
$40,0 $180, $180, $350, $350, $350, $350, $300, $300, $2,400
Estimated Sales $0 $0 $0
00 000 000 000 000 000 000 000 000 ,000
Less (Discounts, Billing
($1,0 ($5,0 ($5,0 ($15, ($15, ($15, ($15, ($12, ($12, ($96,0
Errors, Declined $0 $0 $0
00) 00) 00) 000) 000) 000) 000) 500) 500) 00)
insurance, etc.)
Service Revenue $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Other Revenue $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$39,0 $175, $175, $335, $335, $335, $335, $288, $288, $2,305
Net Sales $0 $0 $0
00 000 000 000 000 000 000 000 000 ,000
($200 ($2,0 ($2,0 ($6,0 ($6,0 ($6,0 ($6,0 ($5,9 ($5,9 $40,00
Cost of Goods Sold $0 $0 $0
) 00) 00) 00) 00) 00) 00) 00) 00) 0
$38,8 $173, $173, $329, $329, $329, $329, $282, $282, $2,265
Gross Profit $0 $0 $0
00 000 000 000 000 000 000 100 100 ,000
 
MA
EXPENSES JAN FEB APR MAY JUN JUL AUG SEP OCT NOV DEC YTD
R
Administrative $5,6 $5,6 $5,6 $5,66 $5,66 $5,66 $5,66 $5,66 $5,66 $5,66 $5,66 $5,66 $68,00
General 67 67 67 7 7 7 7 7 7 7 7 7 0
$30, $30, $30, $45,5 $45,5 $45,5 $45,5 $45,5 $45,5 $45,5 $45,5 $45,5 $500,0
Development
000 000 000 55 55 55 55 55 55 55 55 55 00
$1,0 $1,00 $1,00 $1,00 $2,66 $2,66 $2,66 $2,66 $2,66 $2,66 $20,00
Marketing $0 $0
00 0 0 0 7 7 7 7 7 7 0
$40, $40, $40, $120, $120, $120, $120, $120, $120, $120, $120, $120, 1,200,
Labor
000 000 000 000 000 000 000 000 000 000 000 000 000
Other $83 $83 $83 $83 $83 $83 $83 $83 $83 $83 $83 $83 $1,000
$75, $75, $76, $172, $172, $172, $173, $173, $173, $173, $173, $173, $1,789
Total Expenses
750 750 750 305 305 305 972 972 972 972 972 972 ,000
$20, $20, $20, $45,0 $45,0 $45,0 $67,5 $67,5 $67,5 $67,5 $67,5 $67,5 $600,0
Income Before Taxes
000 000 000 00 00 00 00 00 00 00 00 00 00
$3,0 $3,0 $3,0 $6,00 $6,00 $6,00 $10,5 $10,5 $10,5 $10,5 $10,5 $10,5 $90,00
Income Tax Expense
00 00 00 0 0 0 00 00 00 00 00 00 0
 
$17, $17, $17, $39,0 $39,0 $39,0 $57,0 $57,0 $57,0 $57,0 $57,0 $57,0 $510,0
NET INCOME
000 000 000 00 00 00 00 00 00 00 00 00 00
 
MEMBER DATA EXCHANGE 15

References

Blue Cross Blue Shield Association. (2019a). Government Programs. Blue Cross Blue Shield

Association BlueWeb. Retrieved from http://bluewebportal.bcbs.com/article?id=187303622

Blue Cross Blue Shield Association. (2019b). Implmentation Guide. Blue Cross Blue Shield

Association BlueWeb. Retrieved from

https://bluewebportal.bcbs.com/documents/2574832/2751617/Medicare_Advantage_CM

PE_Implementation_Guide.docx/

Blue Cross Blue Shield Association. (2019c). Inter-Plan Medicare Advantage Care Management

& Provider Engagement Program. Blue Cross Blue Shield Association BlueWeb.

Retrieved from http://bluewebportal.bcbs.com/article?id=187736154

Blue Cross Blue Shield Association. (2019d). Member Data Exchange Business Requirements.

Blue Cross Blue Shield Association BlueWeb. Retrieved from

https://bluewebportal.bcbs.com/documents/2574832/2751617/MA+OOA+Data+Exchang

e+v1.02+5-23-2019.docx/

Blue Cross Blue Shield Association. (2019e). MA Program Overview Slides. Blue Cross Blue

Shield Association BlueWeb.

Blue Cross Blue Shield Association. (2019f). Mission and Values. Blue Cross Blue

Shield Association The Pulse. Retrieved from http://association.bcbs.com/article?

id=875907

Damico, A., Jacobson, G., Freed, M., & Neuman, T. (2019). A Dozen Facts About Medicare

Advantage in 2019. Kaiser Family Foundation. Retrived from

https://www.kff.org/medicare/issue-brief/a-dozen-facts-about-medicare-advantage-in-

2019/