Point Solutions vs. Data Hoarders: K.O. Match

debateAs I wrap up my research into clinical analytics/population health for this year’s Market Trends report, I have been enjoying long and entertaining calls with the vendor community. Without fail, vendors enjoy lobbing insults at their competition (though I might tire of hearing them).

Best-of-breed vendors especially like to recount massive clinical data integration projects that have gone awry (with some NLP-ranting thrown in for good measure). Platform analytics vendors take fewer shots, but generally look down their noses at “point solutions” – good for today, but not tomorrow.

These differing viewpoints have inspired me to create the following comic:


Neither approach is altogether good or bad – it all depends on the market targeted:

PHM best-of-breed products align right in with “mass market” needs: physician practices, smaller hospitals, ambulatory MSSP, PCMH, even larger HCOs. These needs center around quality measure reporting – care gaps, registries, numerators & denominators, patient outreach, physician benchmarking…you get the point. This is also a market with one foot still firmly planted in fee-for-service, so plenty of those “care gaps” are really about driving volume.

Yes, there are more and more experimental risk-based contracts popping up, (mainly MSSPs), and so these best-of-breed vendors also tend to offer claims-based risk scoring, population analyses (quality, cost, utilization), leakage analysis – and always the obligatory physician benchmarking.

Low cost and SaaS-based, the best-of-breed approach does not break the bank and is a necessary entry point for providers taking their first steps away from FFS! Implementations, MDM, data quality issues are not as complex, because less data is integrated (including billing, paid claims, PMS, select clinical data). Note: this is not to say that these integrations are cakewalks. They are not, especially when best-of-breed vendors ingest more and more clinical data.

Data Integration & Analytics platforms, in contrast, are suited towards the very high end of the market taking on real risk: payer-provider-hybrids, large HCOs forming narrow networks, Hospitals self-insuring employees and launching health plans, and other large-scale analytics needs.

These vendors aspire to become the single-source-of-truth across all of an HCO’s data sources in a post-EMR world. Also known as: EDW (+ PHM apps), centralized HIE (+ analytics apps on top), Extract-Hadoop-Load “platforms.”

Platform vendors also offer PHM apps, though their vision is more in line with being able to support any use case the healthcare system might decide to throw at them over the coming decades, e.g., today it is population health, but tomorrow, it will be something else.

Looking Ahead
I have no doubt that clinical data integration/advanced analytics will have to eventually make it to those small 100-bed rural hospitals (for example), though this will be a long and drawn out timeframe. This is most likely to happen when they are acquired or tightly, clinically integrated with a large HCO, or possibly join group purchasing organizations that supply tech+services.

Is there a chance that this downstream market with limited budget will get the benefit  from sophisticated clinical data integration & analytics – in a low-cost, best-of-breed package? I suppose so, assuming that the following happens:

  1. Clinical data becomes more structured, of higher quality, adhering to common standards, and more trusted. The same goes for all other data sources coming on the scene.
  2. Providers & payers magically agree to adopt standards for clinical business rules: quality metrics, physician attribution, disease states, registry attribution, care pathways, enabling app-ecosystem plays.
  3. Analytics technologies become all-powerful: data mining unstructured text, monitoring patients’ health in real-time via wearables & social media, reading clinician’s minds – all of which will make today’s ETL look stone-age. BTW, your doctor is now a computer.

Given the glacial pace of the healthcare industry, I am placing my bets that these two markets will remain as-is for years to come. Platform vendors and best-of-breed are right to disagree – they serve distinct markets with distinct needs. For my part, in my golden years,  I hope to have my biometrics constantly monitored by my doctor-as-a-computer.


Expanding the Clinical Network for Value-based Care

expansionThe provider world is dominated by organizations that believe in a slowly evolving status quo that will somehow carry them across the threshold of accountable care to a fully formed world in which VBR-compliant ways of delivering healthcare solve their sundry problems. These status-quo organizations remain wedded to fee-for-service (FFS) and have not begun to focus on the inevitable shift in risk from payers to providers under future value-base reimbursement (VBR) models.

There are a select number of forward-thinking HCOs that are actively preparing for VBR and the day when revenue depends on how well they deliver care to the individual patient and panels of patients as a whole over time – not just episodically. However, these forward thinkers represent an exceedingly small proportion (5-7%) of all HCOs in the U.S.

An area of weakness we find across HCOs, including a few forward thinking ones, is a lack of core competencies in a number of areas that have been the domain of payers and will be critical for success under VBR including: actuarial analysis, benefit design, utilization management, authorization management, disease management, consumer marketing, and similar functions. One could debate consumer outreach and marketing, but by and large, even here payers have done a better job than most HCOs

Providers of both the progressive and less progressive variety will find that their ability to thrive under VBR depends on how well they perform these functions. Some provider organizations see VBR as a way to disentangle themselves from payers without realizing that they will wake up one day and find that they have become the payer.

These new functions that providers will be required to adopt will ultimately have to be incorporated into clinical operations even though the current crop of clinical applications (e.g., EHRs and HIEs) is arguably not up to the task. HCOs preparing for VBR will find themselves at worst hamstrung or, at best, minimally supported by their clinical vendors.

The longtime focus of clinical application development has been on the physician and, to a lesser extent, the nurse. The point-of-care has been where the money is for EHR and HIE developers. No one can dispute that the physician-patient interaction is the central and most important element in a clinical visit. Every clinical intervention flows from that interaction. However, an office visit consists of multiple interactions between the patient and the HCO. Patients, in a single visit, interact with many people: front office staff, nurses, phlebotomists, radiology technicians, nutritionists, care managers and a host of others. The idea of team-based care requires that EHRs and HIEs do something they aren’t that great at: provide a point-of-care focus for the individual clinician as well as a point-of-encounter focus for the HCO.

When we look at introducing functions formerly performed by payers into clinical operations, the point-of-encounter perspective rises in importance. Under VBR, clinicians will make clinical decisions based on the facts and circumstances of the specific patient and based on past experiences with that patient. The specifics of follow-up care and the composition of a care team will depend on the benefits design and utilization patterns of the patient and the patient’s risk panel.

Instead of sweating out an authorization from a payer for a particular clinical intervention, individual clinicians will be responsible for following evidence-based care plans enforced by the HCO through the EHR/HIE. Instead of letting the payer control where patients are referred, providers will want to keep referrals in-house and away from competing providers.

The irony, at least for now, in this is the volume imbalance between administrative payer-provider transactions and clinical inter-HCO transactions (via HIE and other mechanisms) that are occurring today in a HCO.

Payers have invested heavily in transaction-oriented networks to support all of the things so feared by providers: authorizations, claims presentment, referrals, eligibility determinations. A significantly smaller volume of inter-enterprise clinical transactions, on the other hand, are flowing between HCOs to support a relatively narrow range of point-of-care clinical activities. We think that EHRs and HIEs will have to adopt a view and development focus that looks at the totality of information needed to support a clinical encounter — patient clinical data, administrative data and panel level data — to really support HCOs on their voyage from FFS to VBR.


HIE is a Misnomer

hieFor years now we have been talking about HIE as if health information exchange (the verb) is happening across health information exchanges (the noun). This is wrong for the simple reason that true, full health information exchange is not occurring.

Then what is being exchanged across these HIE networks that public and private entities are spending a fair amount of money to make happen?

Typically, it’s fairly limited clinical data-sets (lab results, discharge summaries, referral documentation) delivered as an HL7 message, ala CCD, or more recently CDA – data sets that rarely embed themselves into clinical workflow where they are most likely to be used. This is not to say that the HIEs that are being stood up today do not provide some level of value – certainly they do and numerous studies point to decrease in duplicative tests, identifying frequent flyers to ED, etc. What I am saying is that the healthcare industry is in a rapid state of transformation and the future need to transmit an ever wider range of health-relevant information across a distributed network will be critical to the success of a healthcare organization.

Some examples:

Advocate Health in Chicago has been working closely with Cerner on the development of “Smart Registries.” In speaking with their CMIO last fall I asked him if he was using their HIE to assist with the data aggregation and information distribution needs that are required to power Smart Registries (their instance taps over 50 data sources). He said no, the HIE simply does not/cannot provide sufficient data nor can it deliver the information they want to present to a physician practice.

In a briefing with one of the largest population health analytics vendors, Optum, who also happened to have acquired an HIE vendor (Axolotl) a few years back, I asked if they were using any of their HIE capabilities to aggregate data to power the new Optum One analytics platform? They said no, the HIE does not deliver rich enough data to do the type of analysis and ultimately deliver the value that Optum One offers.

Last week I met with a vendor CEO to discuss our latest research on CNM. He pointed out that they are seeing a huge need for HCOs to meld clinical and transactional data (claims, PBM, prior auths, etc.) to drive better care coordination across a community. They are now working with a payer and HIE vendor to enable such capabilities to better support ambulatory practices within that payer’s provider network. The HIE alone was not enough. 

The currently limited capabilities of many an HIE will not serve the needs of tomorrow. This belief led us to our research on Clinician Network Management (CNM), which is a visionary look forward on how healthcare organizations need to rethink their dated, and now misnomer of an “HIE strategy” a strategy that has very little to do with the need for a more complete information payload delivered at the point-of-care to enable population health management.

As we found in our CNM research, exceedingly few organizations have come to this realization, though we are seeing glimmers of hope with those on the leading (bleeding) edge such as the aforementioned Advocate. Will others follow? Yes, of course as the transition from fee-for-service to value-based reimbursement will demand it. The real question is when and when they do, will they have the leadership to make it happen? This is a journey not for the feint of heart.


Financial Analytics Bleeding into Population Health Management

Healthcare costsIt appears that “population health management” (PHM) just has a better ring to it than “accountable care” or “HMO 2.0”. Increasingly, PHM is becoming an umbrella term for all of the operational and analytical HIT tools needed for the transition to value-based reimbursement (VBR), including EHR, HIE, Analytics, Care Management, revenue cycle management (RCM), Supply Chain, Cost Accounting, … .

On the other hand, HIT vendors continue to define PHM according to their core competencies: claims-based analytics vendors see PHM in terms of risk management; care management vendors are assuming that PHM is their next re-branded marketing term; clinical enterprise data warehouse (EDW) and business intelligence (BI) vendors argue that a single source of truth is needed for PHM; HIE and EHR vendors talk about PHM in the same breath as care coordination, leakage alerts and clinical quality measures (CQM); and so on.

We at Chilmark have not articulated a single vision for where PHM ends and all other VBR related HIT begins for the simple reason  that “It Depends.” It depends on where you are starting, it depends on your existing IT infrastructure in place, it depends on the community you serve and the structure of your clinical team (acute, ambulatory, long-term care, affiliate vs owned mix, etc.). There is not an easy answer here.

That being said, we are in the process of articulating these issues in a forth-coming Insight Report and it appears that Dale Sanders, SVP at Health Catalyst, has jumped the gun with his own articulation of PHM and what is required to be successful in his recent Population Health Management report.

Note: Vendor-produced papers that rank the sponsoring vendor in question as the top dog are often easily dismissed as biased, despite any claims of impartiality on the part of the author.  This one I found worth the read, however, despite such bias.

Sanders’ initial few paragraphs did a good job of clarifying the difference between, as he puts it:

  • “Optimizing The Health of Large Populations” (Population Health Management)
  •  “Managing Fixed Price Contracts For Health Management” (financial, contracts, risk side of things)

Dale Screen Shot


However at this point in time, there is a huge disconnect between groups dedicated to PHM — quality and care mgmt. groups — and those dedicated to financial & risk mgmt. In one recent conversation with an HCO executive, he mentioned a HCO in their region that had aggressively moved towards VBR, a push by senior executives including the CFO, that was ultimately rejected by clinical executives leading to exodus of CFO and a number of other executives.  This division between clinical and financial leads us to propose the following Venn that represents where we are today.


As the above diagram shows, we are seeing the line between PHM and financial mgmt. blurring over the last few years. Network leakage, total cost of care, utilization KPIs, risk scoring, etc. are increasingly being discussed in the same breath as PHM.

These financial data are desired by HCOs to better manage population risk — across both care management and performance management functions.  For example, a care manager might wish to view the predicted total cost of care for a set of high-risk patients; or a risk manager might want a dashboard that combines paid-claims-based risk scores with clinical-based quality measures.

Going forward, I don’t know if financial departments within HCOs will ever become fully united with clinical teams under the common purpose of PHM and more broadly, VBR. I however do see the “bleeding” increasing, as cost accounting systems, and elements of RCM and staffing become more intertwined with PHM needs in support of a VBR strategy.

My upcoming 2014  Population Health Analytics report will explore these and many other trends further… and thanks to Dr. Sanders for the catalyst to write this post.







Free Research: Migration to Clinician Network Mgmt

CNMLast summer we published another edition of our popular Health Information Exchange (HIE) Market Trends Report. Over the years, this report has for many, become the “authoritative source of information on the HIE Market.” That’s not me talking, that is exactly what we have heard from those who have purchased this report.

This, of course, makes us feel quite proud as our mission here at Chilmark Research is pretty straight-forward:

Provide research that will assist Healthcare Organizations (HCOs) in their understanding, assessment, adoption, deployment and use of IT to improve the quality of care delivered. 

This is what get us up in the morning. This is what motivates us for everyone here at Chilmark wants to make a contribution to improving this crazy, at times frustrating, market sector.

With the release of the latest 2013 HIE Market Trends Report, however, I had an uneasy feeling. The vast majority of the market continued to view HIE as just that, moving basic health information from point A to point B. If anything, HIE has been further dumbed-down with the advent of Direct Secure Messaging, which is really nothing more than secure, point-to-point email – a far cry from interoperability and query-based information exchange.

Another issue was that I was not seeing much thought going into what is next for HCOs and their investments in HIE. Recent reports such as HIEs reduce ED visits is something we have been talking about for years. Seriously, is this the best we can come up with? What new capabilities will HCOs want (or be able) to enable across their HIE? What is the next level of value realization beyond basic records exchange and lab orders/referrals?

I increasingly came to the realization that the vocabulary of how we talk about HIE needed to change. Language is powerful and our current fixation on HIE and the vocabulary associated with it may be preventing this industry from looking beyond this limited construct. For the purposes of that 2013 HIE report, we used the term HIE 2.0 (did I ever mention I have never been a fan of 2.0 attached to any acronym) to signal a change.

In late fall of 2013, after some discussions with clients, consultants and HCO executives, we decided there was the need to test these ruminations. Chilmark put together a prospectus for a research project on Clinician Network Management (CNM) and found five willing sponsors for this research (CareEvolution, McKesson, Optum, Orion Health and one that prefers to remain anonymous). The research objective was to conduct primary research to determine the state of the market in moving to enable CNM, which goes under many guises including physician alignment, clinically integrated networks, etc. but none of these terms have quite the scope that we envisioned for CNM.

Some of the results of our CNM research are quite telling.

  • The market is roiling under massive structural changes.
  • Most HCOs are ill-prepared for the move to from fee-for-service to value-based reimbursement (VBR), though all see it coming.
  • Those select HCOs who are now preparing for VBR are looking to be quite prescriptive in their requirements of affiliated and owned physicians – that will be supported via a CNM model.
  • There remains a divide (level of distrust) between payers and providers that will take time to mend despite the need for both to work more closely together.
  • HIT vendors are, by and large, not keeping up with the needs of HCOs to support CNM initiatives.
  • A best-of-breed approach is seen as only path forward today to enable CNM.

Of course, we learned far more than the above which you’ll find in the report itself. Since this report was sponsored with the intent of helping to educate the market, it is being offered for free. I encourage you to grab a copy – you won’t be disappointed.



HIMSS or Bust

CA or bustNext week is that proverbial event we all, in the HIT industry, look forward to with some trepidation - HIMSS’14. For an analyst firm such as ours HIMSS provides us a great opportunity to talk with end users, vendors of all stripes and just reconnect with like-minded folks. HIMSS is probably the only annual event that is a must attend to get a good perspective on where we are, as an industry, in advancing the adoption, deployment and use of HIT in the provider setting. That’s the upside.

There is a downside to HIMSS as well. Like most conferences of its type, HIMSS is a huge cheerleading event for all things HIT. In many ways, HIMSS is like the town of Lake Wobegon, where all of the children are above average. You will almost never hear anything called into question – no negativity here folks. Everything looks rosy and as one cruises the exhibit hall vendors pitch what they believe is the next big thing in healthcare.

HIMSS is the epitome of buzz-card bingo. Be forewarned ye vendors for which meetings between us have been scheduled for every time I hear “Big Data” I will yell out, BINGO! 

As Naveen pointed out in his recent post, HIMSS and the vendors therein must be approached with a healthy bit of skepticism. But as analysts, we must do our best to not let that skepticism slip into cynicism, for a cynic often paints a broad negative brush, losing their objectivity in the process and not see the good things that are happening as well.

HIMSS is also a fairly large event and I know that no matter how comfortable my shoes, no matter how much rest I get beforehand, by the time I take that flight back to Boston, I will be absolutely spent.

Despite these downsides, I am actually really excited about HIMSS this year and can’t wait to get there.

First and most importantly, this year’s event will be the first time that we have our entire team attending. Not only has this lessened my own meeting burden (last I counted, this year I only have 24 meetings in 3 days vs last year’s 35), it also gives us a great opportunity to interact with a far broader range of stakeholders in the HIT market with analysts focused on analytics, patient engagement, HIE, EHR and the biggest buzzword from last year, population health management (PHM).

I have always returned from HIMSS with new, invaluable contacts and an updated perspective on where the industry is truly at – not the picture the vendors paint, but the composite, the collage that is created from countless conversations over those three to four days of attendance. In having the Chilmark team there, I hope they will also walk away from HIMSS with a similarly refreshed rolodex and some nuanced thoughts on how their respective research domains will evolved in the years to come.

Secondly, we are seeing some interesting trends in the market as of late that need further validation. For example, today PHM is whatever a vendor decides it to be based on their own core competencies. Our conversations with healthcare organizations (HCOs) has not been all that insightful either as their PHM definitions are as disparate as the vendors. Where there is convergence though is on the need for strong analytics to drive PHM initiatives. So if analytics is the engine, what is the steering wheel, what are the tires, is HIE the gas tank, or the fueling station?

Looking to HIE, as we mentioned in late 2013, we see a need to redefine this sector. Where is the next opportunity for value realization for a provider once their HIE is live? Yes, we are looking beyond referrals! We have our own ideas, but we want to bounce those ideas off of others – HIMSS is a fabulously opportunity to do just that.

These are just a couple of my own thoughts. Our analysts; Cora for analytics, Naveen for patient engagement, Rob for EHR and Brian on HIE, all have their own questions they seek answers to. Hopefully, HIMSS will prove fruitful for us all in finding some of the answers we seek on the future trajectory of HIT, where the value is to be found and how together, we can all work towards a healthcare system that delivers ever higher quality care to all.