How a functional algorithm can create better healthcare transparency

The benefits of a functional algorithm in your health plan

Think about some of the biggest challenges your health plan faces when it tries to connect inpatient, outpatient and prescription drug data. Traditionally, these cost drivers are measured in siloes and trying to connect them proves difficult.

For over 20 years, we’ve had the ability to determine the relationship between disparate health events with smart algorithms. A proprietary analytic methodology tool called the Medical Episode Grouper (MEG) is used by over 150 health plans, employers and state Medicaid agencies. It can compare medical and surgical options, costs in the treatment of diseases and medical conditions.

With the MEG, health plans can focus on critical needs such as provider profiling, disease management, quality improvement, and cost and use analysis, all while accounting for patient severity. Ultimately, the MEG is built to connect relevance to appropriateness of care measurements.

Curious about where the MEG could fit into your organization? Consider the following applications:


Profile populations
Provide a solid basis for analyzing overall payment and utilization patterns across a patient population. By organizing healthcare events into consistently defined episodes of care, the MEG allows users to compare the care provided for similar conditions across segments of the population.


Evaluate provider performance
Create episodes of care related to clinical severity. Compare reimbursement, treatment and outcomes across providers while accounting for the type and severity of cases being attributed to the providers.


Compare process of care
Methodology that provides a completely diagnostically-based grouping algorithm. Compare variations in treatment provided for the same condition at a similar level of severity.

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Manage care
Combined elements of the MEG methodology help facilitate the ability to assess the effectiveness of care management programs. Thoroughly assess severity of conditions, track disease progression and identify chronic conditions.

Learn more about Medical Episode Groupers

These are just a few of the many ways the MEG can provide more value to your health plan. Still seeking ways to provide more efficient coverage and find cost-savings?

Learn about Watson Health's solutions for health plans