Category Archives: CMS

ACO Here, ACO There, ACO, ACO Everywhere & Vendor Response

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In less than two years we have gone from Accountable Care Organization (ACO) as a concept, to ACO as a new model of care delivery. With the January announcement that there were 106 more added to the Medicare ACO program, we now have 254 ACOs nationwide. David Muhlestein of Leavitt Partners has done some of his own research and puts the total number of ACO-like entities at over 400. And let’s not forget that commercial insurers are putting forth their own contracts with providers to set-up similar accountable delivery systems where there is some element of gain and risk sharing with providers.

Now it is one thing to say you have signed on to become an ACO and quite another to actually execute on the contract. Among the numerous challenges that an ACO model presents, is the need for more sophisticated IT systems that will support distributed care management across a diverse care team that extends from the primary care physician, to the specialists, to the care manager, the patient and others. EHRs today will simply not get you there.

Today, there is no such out of the box solution from any one vendor that will enable an ACO model. But there are several vendors positioning themselves to be that one stop shop to enable your ACO strategy.

Following are some vignettes of several vendors looking to enable an ACO strategy and what they have on offer. (Note: This is our proverbial toe-in-the-water as we’ll be doing a comprehensive report on this market later this year)

Aetna: A commercial payer, Aetna is looking for new high-growth revenue opportunities and has targeted healthcare IT. Shortly after acquiring leading HIE vendor Medicity, and soon after leading mHealth App iTriage the company announced its ACO-enablement suite that combines the two above with analytics/managed care solution Active Health.
Strengths: Strong HIE brand, good consumer/patient engagement tools
Weakness: Predictive analytics and care management tools are not as competitive

CareEvolution: A privately owned HIE targeting the private, enterprise market, the company has built its own analytics engine, Galileo. Galileo provides deep dive capabilities into clinical, operational and claims data contained within a given network of providers.
Strengths: State of art HIE solution, good analytics capabilities
Weaknesses: Consumer/patient engagement tools are almost non-existent, low recognition in market

Cerner: Cerner’s HealtheIntent is part of the company’s broader strategy to move beyond being an IT company to becoming a health company. Like most EHR companies, ability to move as fast as market requirements is a challenge.
Strengths: Leading EHR, strong brand, leading visionary among EHR companies, has a good HIE solution, has broad suite of consumer engagement tools
Weaknesses: Analytics is lagging, resources to respond quickly is a challenge, distributed care management tools still work in progress

Epic: Company has one objective, rule all and do so through a highly proprietary and closed model. With Epic Everywhere, their HIE solution for Epic sites, company is able to provide exchange across entities as long as they are using Epic. Recently signed deal with Surescripts to allow exchange with other EHRs. Epic’s MyChart is the leading patient portal in the market.
Strengths: Growing dominance in market, solution suite is tightly integrated from ambulatory to acute care settings, patient portal is widely adopted
Weaknesses: Epic continues to follow a dated model of highly controlled, closed system that while providing high integrity, will ultimately yield a lumbering dinosaur – think Wang circa 1983

RelayHealth: Part of McKesson, RelayHealth has always been a catchall for various acquisitions that McKesson could not find an appropriate home for. A major reorg occurred a couple of weeks ago that will reposition RelayHealth as McKesson’s ACO-enablement suite.
Strengths: Strong consumer/patient engagement tools, a leading HIE solution in the enterprise market and with the reorg, the addition of new assets including the recently acquired analytics solution, MedVentive
Weaknesses: Still does not have a good story to tell around distributed care management, how MedVentive will be folded in remains to be seen.

This is by no means an exhaustive list of those HIT companies looking to offer an ACO-enablement solution suite, but simply meant to provide some perspective on what is currently on offer in the market.

As we prepare to head to HIMSS a week from Saturday, on the top of our list of things we wish to learn more about is exactly how companies such as those listed above and others not listed are meeting the current and future needs of the 400+ ACOs across the country and more importantly, how they intend to become the leaders in this rapidly developing field.

Thanks to KramesStayWell.com for the image

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2013 – A Year of Surprises

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In the blink of an eye, a New Year has appeared and with it the need to look into our crystal ball (or is it a magic 8 ball) to make our annual predictions for the healthcare IT sector. Personally, I find this to be one of the more interesting and seriously fun parts of being an analyst.

Be forewarned, we’ve seen enough mealy-mouth, water-downed predictions as of late that simply state the obvious to last a lifetime. So let’s crack a few eggs and make some stretch predictions shall we. (Note: each analyst has contributed a prediction or two, which is noted).

1) Structured Data will Remain Gold Standard in 2013 – Cora
Despite Watson and all the buzz about mining unstructured data, the only data that will be analyzed in volume in 2013 will remain structured data. Forget about the 80% of health data that is unstructured. Simple key-value matching will continue but robust, rigorous pattern matching, NLP, etc, will have to wait.

2) The Need to Address Data Quality Moves to Forefront - Cora
Data quality issues (DQ) will become increasingly visible as more providers wonder why their clinical data is such garbage. Providers will be shocked they need to invest in DQ specialists/departments/processes (along with the security to support them).

3) Many ACOs Come to an “OMG, What Have We Done” Moment - Rob
For the first half of the year healthcare organizations (HCOs) will be all buzzy implementing, on paper, gain-sharing ACOs. By Independence Day these same HCOs will begin figuring out it is hard and expensive to set up an ACO and that their back office financial management tools are inadequate. By the end of 2013, just two years away from Risk Assumption ACOs (RAACOs) HCOs will take one of three paths: 1) realize ACOs carry all the risk and more of HMOs and bow-out; or 2) scramble to purchase and implement complex financial management software; or 3) cash-out and sell themselves to a payer.

4) Several HIE Vendors Pack Bags & Leave – John
Virtually all of the federal funds distributed to States to stand-up their statewide HIEs has been allocated. Without that federal largess we will begin seeing some vendors exit the HIE market. Who will they be? Think large companies with lots of brand equity and close ties to lobbyists but with only modest healthcare experience. Those vendors that remain must now contend with upping their value proposition beyond simple information  exchange (Direct Secure Messaging will take over that task). Some of the weaker HIE players with limited resources will be looking for a buyer.

5) HIE Market Growth Begins to Slow -John
Over the last several years the HIE market has been growing at a blistering pace well in excess of 30%. That growth will begin to taper off ever so slightly in 2013, say 18-22% CAGR as all who have adopted a solution continue down the arduous path deployment and on-ramping ambulatory providers to extract value from their HIE platform.

6) Despite Strong Growth in Direct Secure Messaging (DSM), Fax Isn’t Dead Yet - Brian
Volume growth in use of DSM sent via health information service providers (HISPs) in 2013 will exceed 100% driven primarily by integrated delivery networks (IDNs) seeking efficiencies and referrals. Despite this impressive sounding growth, far less than 5% of all care transitions will use DSM by end of 2013. And don’t forget, numbers lie. Much will be reported in 2013 on the growth in absolute number of secure email IDs issued by HISPs, but the majority of those accounts will remain inactive.

7) EHR Source Code Subpoenaed -Rob
We will see our first EHR software source code subpoenaed in a malpractice lawsuit this year – the developer will be named as a co-defendant.

8) Chorus Grows Louder, Politicians Weigh-in and MU Program is Put in Stasis – John
HITECH & meaningful use (MU) have done their job, by and large as EHR adoption and use has swelled dramatically throughout the healthcare sector. But there is also a dark-side. Deploying software so that it is effectively used takes time. Unfortunately, the provisions of ARRA do not allow for time to be taken, which is leading to a rapid cram-down of EHRs and associated MU requirements on clinicians. Early signs of a backlash began appearing in 2012. That backlash will come into full bloom in 2013 leading to Congressional hearings and ultimately someone in the White House being forced to hit the pause button on MU requirements.

9) Quantified Self (QS) Crosses Over into Healthcare – Naveen
The peripheral, biometric, consumer market is starting to bloom. In addition to completely new products and companies, we will see development of more flexible platforms driven by a focus on open APIs. Employers will start to incentivize the QS movement as part of their benefits programs. There will also be a shift from wellness-only into light medical use of these devices for such things as physical therapy/rehabilitation programs, mood tracking, sleep tracking and simple pain reporting.

10) Providers Take Interest in Health & Wellness Solutions – John 3
Payers and employers are the traditional markets for health and wellness solutions. But in 2013, those healthcare organizations (HCOs) that are moving towards capitated care models will markedly step up their interest in and adoption of these solutions. This will also result in new hires (health coaches, nutritionists, etc.) as clinicians balk at taking on added responsibility.

11) Emerging Conflicts Over Patient Generated Health Data - Cora
Conflicts will emerge between EHR data and user-generated health data.  Early adopting QS-type patients (see prediction 10) will be bringing in their mobile-app-generated data to their doctors. Majority of doctor(s) will declare that the data doesn’t match up to their records and will not accept it. Resulting conflicts over how/if to get this data into the medical record will ensue.

12) Patient Experience Begins Being Factored In to Treatment – John 3
With increasing attention on patient/customer satisfaction and need to improve adherence to treatment plans, innovative HCOs will begin adopting mHealth solutions that enable patients to track, in real-time, their treatment experience. Treatment plans will be modified “on-the-fly” based on these “experiences” to improve adherence.

Of course there were many other predictions that we mulled over that ultimately landed on the cutting room floor. What remains are predictions that we felt will create the greatest disturbances or ripples in the industry. Predictions that are generally not all that obvious or maybe it is just that there are not many who wish to state such in writing (we’re not shy).

Whatever the case may be, these are our predictions. we’ll stick by them unless someone has some incredibly brilliant argument as to why we have it completely wrong (that’s what comments are for).

So have at it everyone, are we on target, or will we completely miss the mark in 2013?

 

 

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Cerner Takes a Road Less Traveled

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Cerner is embarking on a journey of transformation. That transformation, if successful, will culminate in Cerner becoming more than a health IT company to becoming a health company. They’ve tested much of this strategy internally with onsite campus clinics, health and wellness challenges, the creation of rich consumer/patient engagement tools, heck, they have even created their own third party administrator (TPA) as Cerner is self-insured. The company wishes to take these lessons learned, these solutions that have been developed, to transform their company into a health company to address not only the patient experience in a clinical setting, but the patient/consumer health experience throughout the community.

This is all a part of Cerner’s Healthe Intent strategy, a strategy we received a deep dive in during our recent attendance to the Cerner User Conference in early October. Healthe Intent is a big, grand, bold vision in an industry where there seems to be a dearth of such visions. Whether or not Cerner is successful, Healthe Intent certainly has its fair share of challenges, rests more with Cerner than any other outside force. Continue reading →

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A Layer Above it All: Healtheway’s Value Prop

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Now that NwHIN has been spun-out into the public-private entity Healtheway one has to wonder exactly what value they can deliver to market that will sustain them as they attempt to ween themselves from the federal spigot. Healtheway has no lack of challenges ahead but they intend to target one area that presents an interesting opportunity. Question is: Are they too early to market?

During a recent webinar, Healtheway’s interim executive director, Mariann Yeager, outlined the origin of Healtheway, the apparent traction Healtheway is gaining in the market and what their plan is going forward.

Healtheway got its start via funding from a variety of federal sources, all of whom who were looking for a solution to address their unique problems. For the Social Security Administration it was the need for a nationwide network to facilitate processing of disability claims. For the VA and lesser extent DoD it was the need to enable military personnel to receive care in the public sector and insure that their records were complete. Health & Human Services led most of the development effort leading to NHIN CONNECT, a less than stellar technology platform built by beltway bandits (who else), that hit the market with a thud.

One of the things the feds did get right though is a clear and comprehensive policy for data use sharing across disparate entities. The DURSA (data use and reciprocal support agreement) remains one of the key differentiators in Healtheway’s portfolio. Healtheway’s intent is to leverage the DURSA as the “unifying trust framework” and build upon that with a common set of technical exchange requirements (standards) to facilitate exchange with eHealth Exchange (this replaces the former NwHIN Exchange). Healtheway has also enlisted CCHIT to perform testing of technology vendors solutions to insure they comply with the technical exchange requirements that will allow for HIE-to-HIE connectivity.

That last sentence is the kicker. Healtheway and its eHealth Exchange is not intended to be an uber-national HIE but a set of policies and technical specs that will allow HIEs, be they public or private, to share information across institutional boundaries. Therefore, Healtheway will not get into the current rat’s nest of looking to on-board the multitude of ambulatory EHRs into an HIE but sit one level above that facilitating exchange across HIEs. This is something that many regional and state HIE programs are looking to facilitate, thus it is not surprising to see that a significant proportion of Healtheway members come from such organizations.

There will be a need for this functionality at some future point in time, but not today and likely not tomorrow either. Three key challenges stand in their way:

1) Getting buy-in from healthcare organizations and technology vendors. While membership has indeed grown, Healtheway is offering membership at a discount (likely a loss) to gain traction and unfortunately they still do not have significant traction as many brand names in healthcare are missing.

2) A tainted history with more than its share of missteps. Slowly coming out from under the wing of federal politics as a pseudo independent organization (Board still has plenty of government influence), Healtheway may begin to act more as an independent organization, more like a business. Unfortunately, due to a likely continual need for government funding that independence will likely be limited.

3) The HIE market, both from a technology, policy and implementation/deployment perspective is still primitive. The broad market is simply nowhere near the point of needing what Healtheway intends to offer for a few years to come, at least as it pertains to the exchange of clinical data. Good idea, too early to market. That being said, tehre will be value on the transaction side, e.g., SSA and disability claims processing.

Hopefully the future will prove us wrong on this one and Healtheway will indeed prosper and contribute to the maturity of the HIE market. But our advice, don’t bet on this horse just yet, give them six months than take a second look.

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HIMSS’12 Take-away: Follow the Money

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Last week we attended the big healthcare IT confab HIMSS in that grand city of sin, Las Vegas. While many spoke of how HIMSS hit an all time record of over 37K attendees (an impressive number), HIMSS is still dwarfed by what is arguably the largest US-based healthcare trade show, RSNA, which had a 2011 attendance of just over 57K, (roughly 54% greater than HIMSS). Why such a radical difference you ask? As one colleague put it:

RSNA is where providers come to make money and HIMSS is where they go to lose money.

While that may be the case today, it is unlikely to be so in the future. The healthcare industry is undergoing a massive transformation that will likely take a decade to complete as we transition from a reimbursement model largely based on fee for service to one based on outcomes. Under this new model, providers will be taking on a greater portion of risk. In reward, these providers have an opportunity to receive a significantly higher net reimbursement. This transition is making for some interesting bedfellows as payers and providers join together to create new care delivery models such as Accountable Care Organizations (ACOs) and Patient Centered Medical Homes (PCMHs). These new models will be increasingly dependent on a robust HIT infrastructure to effectively measure quality, risk and performance, something that simply cannot be done effectively with the antiquated systems that are in place today in many healthcare organizations (HCOs).

Nearly every vendor we met with at HIMSS had a story to tell about how they had the solution the market was seeking for ACO enablement. This was not entirely unexpected for last year we thought that would be the year of ACO. Obviously, we were a little ahead of ourselves and the industry with that prediction but alas it has come to pass. Small problem though: HIT vendors have had plenty of time to prepare their solutions for ACO enablement but to our surprise, most solutions were still far from mature. Frankly, we are not too worried about this right now for Chilmark is forecasting significant evolution, innovation, and in short-time maturity in these solutions as customers (HCOs) further define what they truly need to succeed in this new world order of reimbursement for healthcare delivery in the US.

This raises what our research team found to be the most significant learning from HIMSS’12.

As most of you already know, ONC made quite a splash at HIMSS by announcing the release of Stage 2 meaningful use (MU) requirements (we’ll have a future post on the implications of these requirements later this week). But honestly, we did not see a wild wrangling of commentary and discussion in the halls of HIMSS’12 regarding these new requirements. Maybe this was because most attendees were simply addressing the needs of today and did not have time to thoroughly review these new requirements. But we believe something else may be at work here.

Our Thesis:
The MU requirements have become little more than a “spec-sheet” for vendors, consultants and IT shops and departments. These requirements have nothing to do with innovation and have little to do with the dramatic changes that will occur in this industry in the next decade. Quoting that oft-used phrase, “follow the money” one can quickly see that the billions in funding for incentivizing providers to adopt EHRs under the HITECH Act is relative chump change to the dramatic fortunes that may be won or lost under the new value-based payment models that are proliferating throughout the industry – payment models that commonly fall under the rubric of ACO or PCMH. In each of these models, EHRs are important to a degree, they are part of the basic infrastructure. But it is what one does with the data that matters (collect, communicate, collaborate, synthesize, analyze, measure and improve). Therefore, if you want to see innovation look beyond today and the tactical push to effectively adopt and meaningfully use EHRs and towards the future of how that data will be used to drive quality improvements, better outcomes and lowering risk exposure.

And speaking of risks…

What was clearly lacking at this year’s HIMSS was patient engagement. Yes, there was a seminar on the topic and sure, everyone speaks of patient-centric care but there was little evidence among exhibitors at this year’s HIMSS (with a few exceptions, e.g., Cerner, MEDSEEK, RelayHealth) that spoke to the need to engage patients as part of the care team. Get a clue folks, one will never get to that nirvana of a truly effective ACO or PCMH without active, effective engagement of the patient. Not having an engaged patient is your greatest risk.

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Who Will be the Salesforce.com of Healthcare IT?

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Last week was the massive Salesforce.com user conference Dreamforce (massive in that there were more attendees at Dreamforce then this year’s HIMSS!). We’ve been reviewing more than a few articles and writings written by those who attended the event. In the few short years of its existence (~13yrs) Salesforce.com has become one of the leading Customer Relationship Management (CRM) vendors in the market and basically pushed the previous leader Siebel to the brink and into the arms of Oracle. Salesforce is arguably the leader in the Software as a Service (SaaS) market and thus someone to pay close attention to on all things “Cloud Computing.”

So what makes Salesforce.com so compelling and what are some parallels to the healthcare sector?

Similar Market Demographics: From the beginning Salesforce has always been structured as a SaaS and targeted the hard to reach and highly distributed sales forces of companies of all sizes. Actually, they first targeted the small to medium business (SMB) market and once successful there, went after Siebel in big enterprises. In healthcare, the vast majority of care is provided by small, 1-3 physician practices that are highly distributed across the country – perfect target for a hosted SaaS offering.

Deliver Value, Not Pain: Since most sales people get a large portion of their salary via commissions, the last thing they want to do is hassle with software that is cumbersome to use. Salesforce.com’s user interface (UI) is very intuitive and surprisingly customizable (within limits) for an SaaS offering. This allows a sales person to configure the the solution to their specific needs. We hear time and again from physicians that the EHR they are being forced to use doesn’t fit their workflow and is often painful to use. (Having been demo’d more than our fair share of EHR solutions, it still shocks us just how awful the UI is for these solutions.) Like their sales brethren, physicians need solutions that fit their processes and do not slow them down.

Fold in Rich Communication Tools: At this year’s Dreamforce, Salesforce.com CEO Marc Beniof spend a substantial amount of time focusing on the rich communication tools that Salesforce is embedding to tap the move to social networks. Right now, the US Government is dumping over a half billion dollars to stand-up HIEs in every State and enterprises are easily spending double that amount to facilitate information exchange in support of referrals, lab distribution, orders, etc. What if a Salesforce for healthcare arrived on the scene allowing physicians to securely exchange information in the same manner that those on Salesforce.com use that platform for secure ad hoc communication with internal and external partners to meet customer needs?

Provide Robust Security – No Leakage: Sales leads are a sales person’s bread and butter and they guard them with their lives for it truly is their livelihood. Thus, Salesforce had to build a system that ensured a sales person’s leads were their own with no possibility of a breach (leakage) to a competitor. If Salesforce can meet this strict requirement, is it such a stretch to preserve the integrity of personal health information (PHI) on such a system?

Focus on the Data & Deliver Simple Yet Useful Analytics: Sales is often a numbers game. This requires superior, robust data management and ultimately the ability to create a wide variety of pre-configured and customizable reports. As we move towards value-based contracts, providers of all sizes will be asked to provide reports as well (typically on quality metrics) to those paying the bills (CMS, payers, etc.).

Provide an Ecosystem: Salesforce has a vision to provide an ecosystem of third party apps on top of their platform but to date, like most companies, they have struggled to make much headway here. But in time, as more and more IT functions move to the “Cloud” to support an increasingly mobile device centric world, an ecosystem is inevitable. In healthcare, where one might successfully argue that physicians are one of the most mobile of professions, accessing apps via mobile devices is quickly becoming standard practice. Increasingly, the healthcare market and in particularly those far-flung physician practices, will look to ecosystems of apps delivered over the Web to their mobile device (touch-screen tablet) to support their practices.

Adhere to KISS Principle: Like sales professionals and for that matter just about any other professional worth their salt, physicians in private practices are extremely busy and the last thing they need is to fuss around with software maintenance and upgrades. Subscribing to a SaaS takes that big upgrade headache and slams it with a double dose of Excedrin.

This got us to thinking…

Who in the Healthcare IT (HIT) market might become the Salesforce.com of HIT?

EHR Vendors:
We can’t think of a single vendor in the EHR market that has the foresight, the vision, the chutzpa to pull off a Salesforce.com move. Sure, one can point to PracticeFusion (who happens to have received backing from Salesforce) but we don’t see the vision there. What about athenahealth you might ask? Yes, they like to portray themselves as such, but honestly, their bread n’butter solution is not a SaaS play but more of a straight services play delivered via the Internet and a lot of old school back office processing in a warehouse in Maine. All the other EHR vendors? Either they’re too small to matter or chained to their legacy business models that they can not break free of to deliver the scale and gravitas of a Salesforce.com like solution for healthcare.

HIE Vendors:
Increasingly, HIE vendors are providing simple EHRs targeting ambulatory practices, they certainly have the information exchange piece covered (to highly varying degrees) are beginning to fold in analytics (big reason why UHG acquired Axolotl) and some are looking to provide an ecosystem play such as Medicity with its iNexx platform, Covisint with its AppCloud or even Microsoft’s somewhat aborted attempt with Amalga. Yet, despite these efforts, we do not see any one HIE company really grasping the reigns and running away with the prize. Each of the aforementioned vendors have their own reasons why they haven’t quite captured the imagination of the healthcare sector and we are not holding our breath waiting for someone to breakout.

Others:
Emdeon has a huge presence in the market as a clearinghouse for claims processing and having just been taken private by private equity firm Blackstone, they may try to make such a play. At the most recent HIMSS sat down with Emdeon for a briefing where they hinted to a desire to move more directly into clinicals, but to date, we’ve seen nothing materialize and it is unlikely to happen anytime soon. Emdeon also has the very real issue of their existing business model (did you no their number one capital expense is postage stamps?) that will keep them on the sidelines.

NaviNet is similar to Emdeon in that they already have a direct connection into the physician’s office with some one million plus healthcare providers using their service. NaviNet has the links but it does not appear that they want to get into the nitty gritty of providing a host of other services and offerings on top of their existing platform. It appears that NaviNet will add small incremental services to their platform rather than go for the whole enchilada keeping the platform simple and streamlined.

Surescripts is making a play in the HIE market with its Kryptiq partnership offering the Clinical Interoperability platform. While still early in its development. the Surescripts play is the closest thing we have seen to date to match the existing Salesforce juggernaut and the one to watch.

Now we certainly do not claim to have all the answers, never have. That is why we have a comments section below. So dear readers, we’ve given you are analysis and now it’ your turn. Who do you think is in the best position to become the Salesforce.com of the HIT market?

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