next year, is expected to give the department a much more accurate and detailed picture of its services and what's being spent on them. While the data warehouse won't be used to set policy -- that's up to the Illinois Legislature -- it will help the department ensure it gets the right kind of funding to cover any policy changes.

Not having that information could prove costly. "If we don't understand the full impact of a change, we could underestimate the cost and have a definite problem on our hands," explained Aflaksen. The warehouse should make sure that scenario doesn't happen.

It Starts with Fraud

If Illinois is like other states with data warehouses, it will use the system to tackle fraud and abuse as much as anything else. Medicaid experts estimate that the nation's Medicaid program loses about $20 billion annually to fraud. To combat the problem, experts have urged everything from empanelling more grand juries to look into the problem to mailing recipients and providers detailed explanations of services paid so honest individuals can help spot fraudulent billing. But the top solution is widespread use of computers that can search for patterns of abuse.

Texas and New York have developed high-profile systems. The Texas Health and Human Services Commission uses a neural network. New York's Attorney General's Office operates a 350GB data warehouse that more than 300 users can access.

In Michigan, data warehousing at the Department of Community Health began in 1994 as a surveillance tool to combat fraud. Today, with 750,000 out of 1.1 million Medicaid beneficiaries in managed care, the use of data warehousing has broadened. "We have gone from a reimburser to becoming a value purchaser of health care," explained Michigan's Olszewski. "We now set the standards and activities for providers, as well as manage contracts with them to ensure that the right services are provided."

To do that, analysts need to profile the providers through queries and computer reports. Prior to data warehousing, it could take a week or longer to receive a response to a query, according to Smith. "Within 30 minutes of receiving the report, the analyst often would have another question to ask. It was very frustrating." With data warehousing, however, answers come back in minutes.

Today, Michigan's data warehouse, also built by Bull, targets questions posed by the analysts ranging from tackling fraud and abuse to expanding child immunizations or cutting pharmaceutical costs. "With data warehousing, we can pose a question, look at the response and see whether we are on the money," explained Olszewski.

In Wisconsin, ad hoc queries rule. The state, which has the dubious distinction of having to build a warehouse twice, used to rely on canned reports from its mainframe that strictly limited the number of queries on a weekly basis. After its first effort at building a DSS failed in 1994, the state brought in EDS to finish the job properly.

Today, the Medicaid Evaluation and Decision Support (MEDS) system can handle hundreds of complex queries annually. More than 90 percent of the queries are ad hoc in nature, according to Diane Evenson, EDS' MEDS manager. "The warehouse has really improved the state's ability to budget and monitor Medicaid every month," she said. "It also helps them to make better decisions about programs, policies or changes in benefit levels. With rising costs, it's always a challenge to keep within budget."

The state has used the warehouse to show that recipients voluntarily enrolled in a managed-care program would not be the most needy and costly patients, as one managed-care provider asserted. When the data showed the opposite to be true, the state was able to negotiate better rates. MEDS has also helped the state force HMOs to provide more accurate information and to determine the cost-effectiveness of new types of health-care programs.

Tod Newcombe  |  Features Editor