Health care is full of acronyms. One of them is the APCD, or All Payer Claims Database. That’s a mouthful that describes a simple goal – creating a system that will allow Coloradans to compare prices and data on health care.

Compiling and sharing this data is designed, in the long run, to reduce costs and improve the quality of care.

Currently, this secure database has information on costs and health care usage for about 2 million Coloradans with private insurance and Medicaid coverage. When fully implemented, it will include data from almost 90 percent of all Coloradans that have insurance coverage.

Legislation in 2010 created the system, and last November, the first phase of the statewide APCD was made available to Colorado residents, providers and health insurance carriers.

The database is designed to provide information that will assist:

Consumers: The database will provide cost information on specific procedures and will ultimately help patients select high-quality and low-cost providers. Even if consumers do not directly access the database, they will benefit as providers improve quality in areas where public reporting is available.

Health care providers: Providers will use the database for negotiations with commercial payers, and it will allow performance analysis based upon previously unavailable data from private and public health insurance plans.

Policymakers: The APCD will help in estimating the cost of new laws affecting health care as well as in calculating the financial impact of legislation. This data can also help estimate the real-world impact of policy changes and assess new options for payment reform and provider accountability.

Employers: Employers will use this data to evaluate costs in general as well as ways to reduce costs and improve the quality of health for employees through the use of preventive services.

Insurers: Insurance carriers can access data for negotiating contracts with providers, and they will be better able to compare themselves against competitors and public programs.

Researchers: Researchers and public health groups will get accurate measurements on such things as disease prevalence; variations in care between providers and geographical locations; gaps in disease prevention and preventive services; and care across at-risk populations

Quality and cost-effectiveness of care: Data from the APCD can be used to determine how cost-effective certain types of care can be. Public health professionals can evaluate public health interventions and providers can see data related to changes in provider practices. Employers and employees can use this information in designing health care benefits.

Nine other states have implemented an APCD and another six states are in the process of building one. Our state’s grew out of the Colorado Blue Ribbon Commission on Healthcare Reform, which recommended in 2008 that Colorado develop a statewide system that would gather claims data from all public and private health insurance plans. That, in turn, led to the 2010 legislation.

This year, there is a new piece of legislation, House Bill 1015, that fixes a gap in APCD data collection. Currently, some data from small businesses with fewer than fifty employees are not included in the database. The reason is a state statute that restricts the sharing of mental health claims data for commercial insurance in the small-group market even though that data are allowed to be shared for individuals and larger businesses with insurance. The bill was approved Tuesday by the House Health, Insurance & Environment Committee.

With this data included in the APCD, employees of small businesses, small-business owners and small business organizations can now benefit from this system. Small businesses are a critical part of the health insurance market and small-business employers and employees may now have access to information that may lead to better health care-related decision-making.

It is worth repeating that all data collected are secure, with information on individuals encrypted and altered so that identities cannot be revealed. Data provided by insurance carriers are aggregated so that individual information cannot be inadvertently revealed. Mental health claims data are especially critical. These data are also protected under federal law as well as other state statutes.