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No Free Lunch or What Might CMS Get from PHR Vendors?

by John Moore | August 11, 2008

Late last week, CMS, through its claims administrative contractor Nordian, announced that they are seeking Requests for Proposals (RFPs) to pilot PHRs for Medicare consumers in Arizona and Utah. Nordian has put together a special webpage for PHR vendors to obtain more information about this pilot demonstration. And you are going to have to act quick as Letters of Intent are due on August 18th.

The stated purpose of the this PHR pilot demonstration says all the right things, (i.e., a Mom & apple pie sort of thing) with three main goals:

  1. Encourage PHR adoption among Medicare beneficiaries.
  2. Understand adoption trends and value participants receive through the use of a PHR.
  3. Compare different PHR models as to efficacy and value delivered to end user.

Up to our PHR vendors may be selected and these will be populated with up to two years of Medicare claims data. Desktop/USB-type PHRs need not apply – only proposals from hosted, Internet-based PHR wil be considered.

Having taken a quick look at the files that one can download which go into further details on the PHR RFP, the most informative was “attachment_a“. This one has the meat of the RFP, e.g.: what are the minimum requirements the PHR vendor’s solution must meet, what are the highly recommended features to provide (pretty extensive wish list), and lastly, “nice to have” features.

All in all not a bad RFP. They do hit some of the high points of what one might seek in a PHR, though I may quibble on a couple of finer points. For example, one feature that ought to be required is a clear access audit record allowing the PHR owner to know who has accessed their PHR, when it occurred, and what files in particular were viewed.

While I applaud CMS for taking action on the subject of PHRs by putting forth this pilot project, I have a very big concern that can be summed up in three short words:

Where’s the Money?

The RFP clearly states that no $$$ will change hands. In other words, CMS is expecting the PHR vendors to foot the bill for this demo project.

Which raises the obvious question, what will CMS get for free?

With the good PHR vendors in the market today seeing strong double digit growth and from what I hear in conversations from some, more RFPs from paying prospects than they can shake a stick at, I predict that few, if any of the “good” PHR solution vendors will bother to reply to this RFP. They have plenty of work for the foreseeable future and this is but a distraction.

Leaving CMS/Nordian with little to chose from!

Sure they’ll probably get enough RFPs to make a go of it, but the companies that respond will more than likely be those with yet unproven solutions or others with poor systems that for obvious reasons have not gained market traction. And what attracts these vendors – an opportunity to maybe get a little PR to keep them going awhile longer or satisfy impatient investors.

Unfortunately, this will result in a program that is looking to address the three goals mentioned above with solutions drawn from the bottom of the barrel – hardly indicative of what may be possible.

But hey, I could be wrong.

There is enough fervor in the PHR market right now and with everyone looking to gain some sort of advantage or differentiation those with some fresh greenbacks from investors who are trying to break into this market may make a go of it. I sure hope so.

But in the end, this RFP does sadden me. A pilot such as this is actually quite an important undertaking for the industry that may help answer some pretty fundamental questions that are often hard to get answers to today. It’s just sad to see CMS not see the value of getting these questions answered for if they did, they would put their money where their mouth is.

5 responses to “No Free Lunch or What Might CMS Get from PHR Vendors?”

  1. Mike Hoogerland says:

    Hi John,

    I wonder about MS HealthVault and Google Health… I realize they are something more than a strictly defined PHR, but the prospect of succeeeding in this pilot with CMS and putting themselves in a positive place to gain many more potential eyeballs on their products as CMS expands this service to more states would seem like an attractive enough reason for them to step in. I admit I haven’t looked at the RFP so there may be features or functions that will rule one or both of them out, but I’d like to hear your thoughts on those two.

    Thanks,

    Mike

  2. John Moore says:

    Mike,
    You bring up a good question.

    The RFP requirements for this CMS pilot quickly rules out a play by Microsoft HealthVault. Now, a partner of Microsoft HealthVault, such as CapMed, Medem, Medikeeper or NoMoreClipboard could respond, but recent conversations with most of these vendors lead me to conclude that they will focus their attention on paying customers.

    Google Health, however, does support much of the functionality contained in the RFP, with the exception of allowing the user to input unstructured data, so that could easily take them out of contention as well.

    At this point, I’m not convinced that whoever wins this proposal will get much more than some PR. The RFP clearly states that in no way will the participants receive any preferential treatment long-term (though we all know it is always easier to deal with those with have some experience with…). Also, CMS is a highly matrixed entity that works within all 50 states, through a wide range of contractors for claims processing, e.g., Nordian out west and Palmetto in SC (this is the ongoing demo with PHR vendor HealthTrio for SC Medicare recipients). Bottom-line, participating does not insure repeat business and certainly not a broad national roll-out by CMS of a given PHR vendor’s solution.

    Cheers,
    John

  3. […] (Nice to see a government agency put money on the table for a viable pilot program – why the feds can’t do this is a mystery to me. Then again, maybe all those tax dollars are going to support another failing […]

  4. […] to allow CMS to support telehealth (new technology with clear benefits) or funding in support of PHR demonstrations, then we would be getting […]

  5. […] not a big fan of this CMS project when first announced for the simple reason that the government was not putting […]

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