Healthcare tools maker SHPS, which is based in Lousiville, Ky., has introduced a health risk engine that allows employers–and employees–to manage their health expenditures effectively. The new tool lets self-funded employers quantify health risks among its employee population and actively monitor the drivers of those risks as part of an effort to contain healthcare costs. "Traditional healthcare purchasing patterns among employers have focused on the flow of dollars, rather than the flow of care," says Krishnan Sastry, executive vice president for strategic development and innovation at SHPS. "The SHPS health risk engine lets an employer understand both his flow of dollars and his flow of care. This can help in fashioning healthcare strategies. Understanding your employee population's healthcare risk and what sorts of services need to be provided going forward can help mitigate those risks, especially for those who have emerging risks."

The health risk engine tool generates an employer health index and personal health index. Using the demographics provided by the employer, along with the healthcare utilization data from providers, the health risk engine creates customized indexes for each plan sponsor and individual. The SHPS health risk engine can be tailored to the company's unique employee profile, allowing employers to monitor the performance of their multiple health plans. It also can permit companies to drill down to specific risks within their population, determine the level of care needed and trigger clinical interventions. Companies can institute wellness management programs that address risks, such as gaps in care, medication compliance and individual employee behavior. The tool is hosted on SHPS servers and reports to clients are presented by SHPS consultants. Among SHPS's client list is $5.1 billion telecommunications equipment maker Avaya Inc.

"Just as you need the tools to manage financial risk, an employer needs to manage the clinical risk," says Sastry. "What SHPS health risk engine does is not only quantify risk, but it also provides the stakeholders the necessary tools to address them." Among the stakeholders are SHPS staff members, who act as consultants to plan sponsors to help them understand their employee populations and which care management programs need to be in place.