How to Succeed with a Provider-Sponsored Medicare Advantage Plan

By Matt Cox (Chief Marketing Officer, Lumeris) and Nigel Ohrenstein (Senior Vice President and head of Market, Lumeris)

doctor consults with Medicare Advantage patient

Health system and health plan leaders across the country are asking the same question: how will our organizations survive and thrive in a value-based world? As the shift to lower-cost settings accelerates and the population becomes older and sicker, organizations are seeking new ways to manage costs, generate income and control quality.

For many organizations, launching a Medicare Advantage (MA) plan paves the way for value-based care models that reward delivering better care at lower costs by combining clinical and financial expertise. As enrollment in MA continues to outpace traditional Medicare enrollment – with national MA penetration growing from 30 to 50 percent in the next 10 years – organizations must have a strategy that enables success in the future.

Benefits of a Medicare Advantage plan

MA is increasingly viewed as a potential growth area for organizations. While launching a plan certainly carries risk, it also offers significant upside for providers and payers to successfully manage the health care needs of members.

With an average annual premium of $10,000 per member according to a Lumeris study, MA enables provider-sponsored plans to manage the risk of a population. Access to comprehensive claims data can be used to identify high-risk patients and areas of high utilization, supporting an organization’s population health efforts and steering patients in-network. With aligned incentives, organizations can innovate and invest in care delivery with tools and workflows that support high-value, appropriate care.

Further, MA’s sophisticated risk adjustment methodology supports premium payments that reflect the expected cost of providing medical care to each member, including those with complex conditions. Proper risk adjustment requires providers to capture diagnoses accurately and completely to support reimbursement.

Finally, with Star ratings, well-managed MA plans that earn 4- to 5-Star ratings can attract more members and revenue through enhanced benefits. Highly-rated plans receive performance bonuses that bring in an extra five percent a year, which are used to provide additional benefits to members.

Consider creating a plan built around a collaborative model: one that aligns incentives, bolsters the provider-payer-member relationship and enables delivery of high-quality, cost-effective care.

Building blocks for a provider-sponsored plan

Establishing a provider-sponsored MA plan is a significant undertaking. Given the large investment of time and money, organizations considering launching a plan must ensure they have several foundational elements in place. Consider creating a plan built around a collaborative model: one that aligns incentives, bolsters the provider-payer-member relationship and enables delivery of high-quality, cost-effective care.

Organizational and market strategy

Before launching a plan, organizations must evaluate their tolerance for risk and ability to capitalize said health plan. A strong brand reputation in the market is obviously crucial, but additive resources and significant infrastructure are also required. Organizations should also consider market dynamics, population growth and reactions from key players – competing systems, provider groups and other payers – and how these factors impact their strategy as a differentiated plan offering in the market.

Operational experience

Considerable infrastructure is required for claims processing, actuarial analysis and utilization management, among other payer functions, which can be leveraged from working with a collaborative payer or operating partner. In MA, expertise in Star ratings, risk adjustment, sales and marketing, compliance and plan design add further complication to successful operations. To build the right foundation, provider-sponsored plans must focus on enabling the provider-payer-member relationship, often requiring innovative processes on everything from data transparency and aligned incentives, to coordinated care management programs and shared governance.

Engaged network

Core to a collaborative model is ensuring organizations are aligned. Managing a health plan requires organizations to focus on improving patient outcomes and monitoring the entire population, not just the patient in front of them. Fostering the right network and governance, aligning incentives to create mindshare, sharing best practices and information, and supporting new workflows and behaviors are all critical to success in value-based care delivery.

Partnering for success

Before launching a collaborative MA plan, organizations must assess capabilities to identify gaps in knowledge, expertise and operations. For most organizations, working with an operating partner is more effective than building internal MA competencies from the ground up. Finding a partner with skill and experience in launching a collaborative plan can enable organizations to gain a competitive advantage more quickly. It can improve the likelihood of success while limiting risk and enable providers to focus on their core strength of delivering high-quality, high-value outcomes.

One example of bringing these necessary capabilities together is the newly announced collaboration between Cerner, a global leader in healthcare technology, and Lumeris, an award-winning health plan and value-based care managed services operator. Under the relationship, the companies will provide a suite of offerings under the name Maestro Advantage™, designed to enable health systems and health plans to drive success in value-based arrangements through population health service organizations or provider-sponsored plans. The offerings combine Cerner technology and Lumeris operational services aiming to streamline redundant processes that burden members, payers and providers, including lengthy claims processing and reimbursement cycles, and obstacles to sharing data and records across any electronic health record in the network.

This post originally appeared on September 19, 2018, as the second in a series of sponsored guest blog posts on our Convergence conference blog. 

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Optum’s Deal With DaVita: Vertically Integrated Healthcare Continues to Grow

Healthcare continues trend toward consolidation as more M&A deals mark the end of 2017

As we kick off 2018, we rest in the wake of the announcement of the largest M&A deal to date in the healthcare industry between CVS and Aetna. While stakeholders speculate about implications, another deal was announced between healthcare payer UnitedHealth (UNH) and provider group DaVita (DVA). UNH’s Optum announced an agreement to buy a division of DVA, DaVita Medical Group (DMG) – not the dialysis management business for which DVA is well known – for approximately $4.9 billion in cash. If the deal passes through regulatory oversight, Optum will have removed an attractive acquisition target for competitors looking to acquire provider groups.

Along the same line, within 2 weeks of the Optum-DVA deal, Humana indicated plans to acquire Kindred Healthcare. These M&A data points reinforce the trend toward healthcare payer and provider convergence that Chilmark Research highlights as the theme of our annual conference. The race is on for market share of vertically integrated health systems.

With the DMG acquisition, Optum’s healthcare delivery division, OptumCare, gains yet another provider group (see Table 1). The acquisition will bring with it roughly 1.7 million patients served annually across a range of specialties and forms of care delivery.

Table 1: Optum’s Recent Provider Organization Acquisitions

DaVita’s Divestiture & Appeal to Acquirers

DaVita is one of eight healthcare providers in the Fortune 500 for fiscal year 2016-2017 (see Table 2).

Table 2: Healthcare Providers in the Fortune 500, 2016-2017

DaVita had been acquiring provider groups aggressively. It is reasonable to presume that DaVita continued to acquire provider groups to be more attractive for DMG acquisition. It is unclear whether this divestiture serves as an example of providers challenged by the prospect of risk management, which is in the DNA of neither a payer nor a provider, or another strategic business decision.

While DaVita’s dialysis management business continued to thrive, DMG struggled. In third quarter SEC filings, the company highlighted divisional losses attributed mostly to a change from shared risk to global risk contracts, increased utilization, growth, and increased labor costs.

DMG has 300 primary and specialty care clinics, 35 urgent care centers and six surgical care centers in California, Florida, Colorado, New Mexico, Nevada and Washington. DMG only represents about 25% of DVA net revenues, but there are a finite number of acquisition targets for Optum and its competitors to pursue with the same consolidated magnitude, breadth, and geographic distribution of DMG.

As with the CVS-Aetna deal, the promise of the Optum-DMG deal has to do with the vertically integrated business and care operation. By aligning business interests of organizations across the risk spectrum and the care continuum, population health management, optimization of risk based contracts and cost management all promise to be more effective.

 

Optum’s Opportunity to Capitalize

As with the CVS-Aetna deal, the promise of the Optum-DMG deal is the vertically integrated business and care operation. By aligning business interests of organizations across the risk spectrum and the care continuum, PHM and the optimization of risk-based contracts and cost management all promise to be more effective.

Integrating and driving efficiency across provider organizations acquired by Optum is not a simple task. The organizations listed in Table 1 use a litany of technology solutions from various vendors including Cerner, Allscripts, NextGen, Meditech, Conduent, Inovalon, Healthfusion, IBM, Medelytics, McKesson, and Softcare. As Optum acquires provider groups, it must decide how prescriptive and assimilative to will be. This includes process and protocols, as well as other aspects of system interoperability.

Components of OptumInsight, including analytics, short-form health surveys, consulting and decision support (Impact Intelligence) may all offer a means of improving efficiencies at the DMG subsidiaries that had been performing poorly for DaVita. It is not clear, however, how Optum specifically will be able to convert these provider groups into more profitable organizations.

 

Decentralization and Consolidation

Over the past decade care delivery has trended toward a decentralized model, migrating from acute to ambulatory care. Surgical centers, alternatives to traditional primary care, and urgent care clinics arose to provide alternatives to a traditional hospital-centric care model. This has challenged stand-alone hospitals and yielded a further fragmented care system.

With ubiquitous EHR systems, the challenges of interoperability began – but as the industry has made steps toward better integration, the hurdles toward providing efficiencies have become more business driven. Consolidation is an inevitable remedy – and it appears to be upon us.

Consolidation of payers and providers will be a battle for patients under management and their ability to create greater efficiencies as consolidated organizations. Administrative efficiencies, risk reduction and lower costs of care management are feasible at scale, but coordinating care across a diverse set of care environments can be challenging and systems integration remains difficult. By owning more layers of care, the payers can reduce integration friction. Care coordination in network can be improved and decentralized care environments more effectively leveraged for their individual contributions to cost reduction and improvements to care quality.

We will be watching to see if UNH and Optum can turn this acquisition into a win by leveraging their data, the skill of their services, the quality of their technology, and the ability capitalize on the reduction of organizational barriers.

In this acquisitive environment, the power appears to lie with the payers and other large health brands such as CVS, as most providers have less capital and haven’t been moving as fast. It is worth evaluating, though, whether partnership or acquisition is the more suitable strategy in this time of flux. We will explore this topic in a Domain Monitor for CAS clients in the upcoming weeks.

As 2018 begins, what is the next big deal on the horizon? How will organizations like Partners HealthCare or Kaiser Permanente respond to acceleration of M&A around them? Will the potential mergers of Dignity and CHI or Providence-St. Josephs and Ascension give provider organizations enough depth and breadth to counter payer M&A moves? We will certainly ask ourselves these questions as these mega-deals continue to unfold in an increasingly convergent provider-payer market.

Plainly Speaking: A hitchhiker’s guide to the [Healthcare IT] galaxy

I am always struck by how industries evolve language for the benefit of, and use by, its members. But membership has its privileges and its drawbacks. While simplifying ways for insiders to communicate, it excludes, or at least distances itself from, those not part of its club.

doctor shrugging, confused

Such is the state of healthcare IT, breeding an entire cottage industry of acronyms worthy of their own syllabus. Health IT is one link in the healthcare supply chain of interoperable links, and its value lies in its ability to push and receive information to and from its fellow linked parties. Perhaps if challenges and achievements in health IT were discussed in plain English, it would be easier for physicians, employers and the consumer public to digest. Our representatives in DC could also better understand how legislation helps or hinders patient care; the repeal of Net Neutrality is a timely example of the health industry failing to persuasively advocate.

Perhaps if challenges and achievements in health IT were discussed in plain English, it would be easier for physicians, employers, [our DC representatives] and the consumer public to digest.

Being somewhat versed in this code, when my physician couldn’t locate my patient record, I asked him when he subscribed to his current vendor. As the lightbulb went off in his head, he quickly navigated to a “separate patient records portal prior to EMR” subscription and found me, explaining the 30-minute delay. Further conversation revealed my practitioner was unfamiliar with much of the acronyms health IT relies on (e.g., HIE for Health Information Exchange,  HISP for Health Information Service Provider), and reported he is frustrated that his EMR vendor can not integrate his practice’s earlier patient records, nor does it provide follow-on training to him and his predominantly new staff. He added that his vendor offers no means of direct communication nor does his Accountable Care Organization have a channel or procedure for him to report deficiencies. Consequently, his pain points remain, as does a lack of guidance to his to his staff on its usage.  I can’t verify the accuracy of his statements, but the fact that he believed them to be true indicates little chance of resolving his needs, his office turnover declining, or preventing more of his patients from needlessly waiting while donned in paper gowns.

Like much of the population, I am cramming in my family members’ visits before year-end to use up my HSA dollars. As a new member of the Chilmark team, I have a few questions, in addition to my usual, of the doctors I visit. So far, the same experience noted above was reported by two other physicians. A couple more on my schedule before the year is out and I may wind up with a straight flush!

The EMR vendor’s relationship is with the larger ACO entity, but patient care is in the individual practices by the professionals administering care, and the few I spoke with reportedly felt their workflow issues remained unaddressed. All were surprised and genuinely appreciative that I sought their opinions and experiences in accessing the data they require. We should be mindful that by creating our vernacular for health IT professionals, we do not omit other stakeholders in the conversation whose participation is required for improved and engaged patient care.

Author’s Caveat: This is just my casual survey from a suburb outside NYC but I am eager for others to conduct and comment on their own.

Implications: Supreme Court Gives Thumbs Up to ACA

This morning, as most of you already know, the Supreme Court ruled that the Privacy Protection and Affordable Care Act (commonly known as ACA) is constitutional and basically left the entire law intact. While it was no surprise that this was a close 5-4 decision, it was surprising that rather than rule that certain sections of the law were unconstitutional (e.g., the individual mandate), it was either an all-in or all-out dividing line (those in dissent would have thrown the entire law out the window). In fact, among our esteemed and we like to think highly knowledgeable readers, two-thirds voted in our prediction poll that ACA would be circumscribed by the Supreme Court while 17% felt the law would be upheld in its entirety.

Implications of Decision:
We are an analyst firm that is focused on the adoption and use of healthcare IT. Thus the implications of the Supreme Court decision which follow are focused on just that:

Healthcare systems will continue to aggressively move forward to form comprehensive care delivery systems (acquiring practices, long-term care facilities, etc.) to more effectively manage their patient populations across care settings. This will in turn require greater clinical connectivity and integration across these care settings. Expect to see very strong demand for health information exchanges.

Payers will continue to struggle with improving their operating margins. Some, such as United Health Group and Aetna, have ventured into the more lucrative and higher margin HIT market via acquisitions. Expect to see other payers make a move here as well jumping into the HIT market via acquisition(s).

Payers will also venture directly into care delivery via partnerships with large providers to stand-up ACO-like entities (e.g., Blue Cross of CA & Dignity Health) or acquire (e.g., Highmark and West Allegheny). We may also see some payers be quite innovative and begin providing more state-of-the-art, low cost concierge care services such as One Medical to serve the vast pool of some 30M+ new members nationwide.

To effectively and efficiently survive under future bundled care reimbursement models, hospital systems will finally have to get truly serious about patient engagement. No longer can they view this as just something for the marketing department to deal with (listen to yesterday’s podcast) but will need to actively engage with patients and aggressively encourage self-management of chronic diseases. This need will lead to a blossoming of innovation in new solutions, be they mobile, telehealth, whatever you want to call it to improve patient adherence outside of the clinical setting.

Got Analytics? Yes, analytics is going to be huge but today, most analytics solutions are not up to the task of serving all healthcare provider needs, or at least no single solution/vendor is. Providers will need to accept the fact that for the foreseeable future they’ll be purchasing best-of-breed solutions. But providers also need to do their homework as we predict that there will be a significant amount of consolidation, via acquisition, in this market over the next five years. And one last word of advice to providers, don’t count on your EHR vendor to deliver these solutions anytime soon.

Of course there is far more that we could delve into on the implications of this ruling to the HIT market but for now believe we have provided enough to get your collective  juices flowing. Is there anything we missed that you believe is screaming out loud in the HIT market due to this decision? If so, please let us know via a comment – we love comments!

In closing, hope all have a great July 4th week ahead and…

God Bless America

Why Apple iPad will Dominate in the Enterprise

Ok, before I even begin, let me put it right out there: I’ve been using Apple products since I first got my hands on one of those cute little Mac SEs in the late 80’s having given up my spanking, brand new Compaq 386 with 64kb of RAM and a dual 3.5 & 5.25 floppy drives to a post doc at MIT who traded me the Compaq, which he needed to finish his thesis, for his Mac. I never looked back. I will attempt to keep that bias in check in this post.

Tomorrow, Apple will formally release the iPad 2, a device that has seen extremely strong adoption in the healthcare sector and even one of the HIT industry’s leading spoke persons, John Halamka of Boston’s Beth Israel Deaconess Hospital (he’s also Harvard Med School’s CIO) spoke to the applicability of the iPad in the healthcare enterprise in the formal iPad 2 announcement last week.

The iPad 2 release is happening while most other touch tablet vendors including HP, RIM, Cisco and those building Android-based devices struggle to get their Gen 1 versions into the market. Of these other vendors, only Android-based devices are available today, including among others the Samsung Galaxy and the Motorola Xoom.

But it is not so much the new features in the iPad 2 (e.g., lighter weight, faster processor, two cameras, etc.) that will continue to make the iPad the go to device for physicians and healthcare enterprises, it is the process by which Apple vets and approves Apps that are available in the App Store. Apple imposes what at times for many App developers is an arduous and at times capricious approach to approving Apps. This approval process is in stark contrast of the one for Android, which is based on an open, free market model letting the market decide as to which Apps will succeed and which will not.

Virtually any patriotic, flag-waving American will say Hoorah, the free market rules. Of course a lot of App developers are saying the same thing and have riled against the Apple process since the first iPhone release back in 2007. But the free market, even here in America is truly not free. We have put laws and regulations in place, be they environmental, public health, etc. to protect the broader public good. Apple has done much the same for its App Store insuring that those Apps which are approved are unlikely to cause harm, which on a mobile device is usually the release of personal information such as passwords, credit card information, etc.

Unfortunately, the same can not be said for the Android OS and its marketplace of Apps. There have been numerous reported cases of malware Apps in the Android Market that most often are not removed until after thousands of users have had their personal information compromised. The latest occurred a little over a week ago when Google removed 21 malware Apps from the marketplace and then proceeded to remove about 30 more.

In the healthcare enterprise market, where very sensitive patient information is gathered and shared for improving the quality and efficiency of care delivered, touch tablets are seen as an ideal form factor for the ever on the move clinician who is looking to access the latest patient information at the point-of-care. Therefore, as clinicians increasingly demand access to such information via their touch tablet device, healthcare IT executives will increasingly seek to insure that the devices used are truly secure. Google’s continuing struggles to keep its Android Market free of malware will prevent devices using this OS from seeing greater adoption in the healthcare enterprise. This will allow Apple to continue to put distance between itself and other touch tablet competitors in this increasingly lucrative market.

Addendum:
Jared Sinclair, an ICU nurse in Nashville TN, has a similar view on the topic,

 

HIMSS or Bust

Two extremely short weeks from today will be the official start of that annual healthcare IT (HIT) confab called HIMSS. Tens of thousands will gather to hear the latest and greatest on how HIT will deliver unfathomable rewards to all who adopt. Of course there will also be those discussions that if you aren’t on the EHR, HIE, CDS, RCM or any other HIT acronym bandwagon then surely you will fail to meet the high goals and aspirations of the policy wonks in DC and State-houses across the country. Your days are surely numbered.

Don’t get us wrong. Chilmark Research is actually a strong proponent of HIT, if it is judiciously deployed, clinicians have a voice and training is truly training (A friend who is a nurse told me the horror story of sitting in two full days of training where the trainer from a very well-known ambulatory vendor refused to allow those in the class to actually use the EHR – they had to sit and watch endless demos). Problem is, as the training example points out, this is rarely done and the aggressive timelines of ARRA for EHR incentive payments sure doesn’t help.

But we digress. If nothing else, HIMSS affords one the opportunity to get a pulse on the industry if one just ignores most of the loud pronouncements plastered all over the front of the various booths and in those all too common theaters. Having been to countless events such as this in numerous market sectors, the pulse is found behind the scenes, behind the posters, in the hallways in casual conversations, in the questions that you overhear being asked, in private conversations with key people in the industry.

In my own case, I look to HIMSS as partly educational, partly business development. Over the last few weeks I have received countless invitations to meet with various companies of all shapes and sizes. I just wish those sending these invitations would actually take the time to get to know Chilmark Research first as the vast majority are of very little interest – I mean really, do I want to sit-down and learn about the latest COW?

I do a lot of planning upfront and select who I want to meet with and rarely entertain unsolicited invitations. At this point, my three days of HIMSS are completely packed and if I were wise I’d spend the next two weeks taking it easy and resting up for what will be a three day marathon that begins with breakfast meetings and ends sometime late after the last reception. The most exhausting part of it all, simply that as an analyst you are always “On”. In almost any conversation you are asked for an opinion, a forecast, a prediction and if they don’t like it, you then need to defend it with logic. I love the challenge, I love the intellectual stimulus but by the time I board that flight home I’m totally spent.

To help you prepare for HIMSS, here are a few suggestions:

Attend the mobihealthnews webinar this Thursday, February 10th at 2pm ET. I’ll be presenting alongside mobihealthnews editor Brian Dolan and Diversinet executive Mark Trigsted. We’ll be talking about mHealth Trends in 2011 and what to expect at HIMSS on the mHealth front. Registration is free and last I heard, they have nearly 800 registrants.

Register for the FierceHealthIT HIMSS Executive Breakfast which will be held Tuesday morning. I will be part of a great panel that includes Lynn Vogel from MD Anderson, Joe Kvedar of Partner’s Center for Connected Health and Capt. Robert Marshall, CMIO of the Navy.  Our topic: mHealth’s Evolving Role in Achieving Meaningful Use, should make for a lively conversation.

Keep your meetings with vendors short. There is so much going on for your typical vendor that it will be difficult for them to truly remember details of an in-depth discussion.  So much is happening at a big event like this that the best one can hope for is a meet n’greet type of meeting where one meets with some key executives of the vendor, gains a quick read on their direction, what the vendor sees as important. With this information, you can determine whether or not a more in-depth follow-up meeting is warranted.

Be sure to leave yourself a good 15-30 minutes of space between meetings. This time will prove invaluable for a number of reasons including:

  • Gives you a breather to go over your notes and add any details you may not have written down during the meeting itself.
  • Provides some cushion should a meeting be going very well allowing you to carry a conversation to a successful conclusion.
  • Allows you time to get to your next meeting without being late. (Last year was a nightmare for me with the exhibit hall split in two – took forever for me to get from one side to the next. Thankfully I had some cushion time built into schedule.)

In closing, while I find HIMSS to be depressing at times and the hype of vendors far out-strips their ability to execute, this is a valuable conference to attend as it does bring all the key industry players in HIT under one roof. Despite all the wonderful communication tools we now have at our disposal from Facebook to Twitter to webcasts, emails and good old fashion phone calls, we are still social creatures and we do need face-time with one another to strengthen relationships, form new ones and assess ones we are unsure of. This can only be done in-person and HIMSS provides that opportunity.

Defining a Maturity Model for HIEs

Before entering the convoluted healthcare IT sector, I had worked in the manufacturing sector both as an IT analyst and in corporate strategy for Europe’s second largest enterprise software company. In those many years I learn quite a bit about not only how to effectively deploy large enterprise software systems (SAP, PeopleSoft, i2, PTC, SSA, Dassault Systemes, etc.) but how to create models that would guide clients in a methodical manner in IT adoption. A common model used was the five stage Maturity Model, which was originally developed at Carnegie Mellon University.

The beauty of the maturity model is its simplicity and focus on process change. This proved very effective in educating all stakeholders within a manufacturing company, from the C-suite on down, as to how they needed to think about their internal processes, the technology they were preparing to deploy and the final end-point that they should strive towards. But one should not look at maturity models as completely static for the technology does change overtime and subsequently what is possible.

In doing research for the HIE Market Report I was surprised to not find a maturity model for HIEs (heck, it was hard to find much of anything with regards to maturity models in HIT). This puzzled me greatly for if any sector of the HIT space needs a maturity model, it certainly is the HIE sector. This pushed me to create the five stage HIE maturity model shown below. In viewing this model, keep in mind that the model is not meant to be an exhaustive list of all that is possible but simply describe what are the natural characteristics of an HIE as it matures over time.  As in the models I created for the manufacturing sector, this one is designed to assist those who are planning to deploy an HIE, or may be operating one now, on what they need to think about in mapping out their future strategy. For this particular model, I used three instead of the customary two columns with the third column (Characteristics) providing guidance as to the IT capabilities that would be required to meet the Objectives of that particular Stage.

What’s next?
Ideally, this maturity model sees wide adoption and use by both public and enterprise HIEs. Honestly, that is why I’m pulling it out of the HIE Market Report and putting it out here in the public domain for part of the mission here at Chilmark Research is to indeed facilitate the effective adoption and use of HIT by ALL stakeholders in the healthcare sector.

Secondly, this is being released to get the feedback of those in the field that are deploying HIEs, running HIEs, providing HIE solutions. Please provide your views, your perspectives on this model. Is it logical? Does it make sense? Is there anything missing?

I look forward to your critque.

iPad in Healthcare: A Game Changer?

There have been a lot of discussions on the Net regarding the potential impact of the iPad in the healthcare sector.  At this point, there is very little agreement with some pointing to the ubiquitous nature of the iPhone in healthcare as a foreshadowing of the iPad’s future impact, while others point to the modest uptake of tablet computing platforms as a precursor for minimal impact.

Our 2 cents worth…

We believe the iPad will see the biggest impact in two areas: medical education and patient-clinician communication.

The iPad’s rich user interface, native support for eReading, strong graphics (color) capabilities, ability to use various medical calculators (there are a slew of them already in the AppStore) and numerous other medical apps (most of these are iPhone apps and will need to be updated to take full advantage of the iPad’s larger 9″ screen) provides an incredibly rich ecosystem/learning environment for medical students.  Nothing else comes close – a slam-dunk for Apple.

That rich, graphical user interface, it’s inherent e-reader capabilities and portability also lends itself as possibly the best patient education platform yet created to foster patient-clinician interaction.  At bedside, a clinician has the ability to review with a patient a given treatment, say a surgical procedure, prior to the operation showing rich anatomical details (e.g., a patient’s 64 slice color enhanced 3D CAT scan), potential risks, etc. Heck, one could even show a video clip of the procedure right there on the iPad.  Now that is cool and sure beats the common approach today, some long lecture that oft-times is difficult to follow.

Beyond those two compelling use cases, other uses in healthcare for the iPad include its use by nurses and hospitalists to provide bedside care, tap multiple apps (hopefully multi-tasking will come in OS v4.0 to be announced on April 8th), in an intuitive environment.  As to how the iPad may extend beyond these limited boundaries for support of say charge capture and CPOE remains to be seen but in the immortal words of many an Apple iPhone advertisement:

There is an app for that.

And based on some of our initial conversations with mHealth app developers, many are already working on just these types of applications for the iPad, which they hope to bring to market within next several months.

One thing is certain, from at least one data point we received this past weekend, there is strong, initial interest in the medical community as to what the iPad may facilitate.  Speaking to one of the technical folks at the local Apple store this past weekend we learned the following: Of the 1,000 iPads sold on Saturday (this store did sell-out), 700 were sold off the floor and 300 were reserved for business customers.  Of those “business customers” a significant share of those 300 iPads (north of 30%) were sold to local medical institutions.

One of those local healthcare institutions appears to be Beth Israel Deaconess Medical Center (BIDMC) where an ER doc has provided his own iPad review, based on actual use during a shift.  Particularly like his comment about using it for patient education.  Might the iPad truly bridge the information gap between patient and clinician?  One thing is for certain, it will make it much easier for patient and clinician to confer over a given diagnosis, results and creation of a treatment plan with supporting documentation/graphics.

Read into that what you may but one thing is for certain, there is significant interest in the healthcare sector to at least understand how the iPad may be used within the context of care delivery in a hospital.  It remains to be seen as to how end users will actually use these devices and what apps will be developed to serve this market (might Epocrates see stronger uptake for their EMR on the iPad vs. the iPhone?) that take advantage of the larger, 9″ screen, but based on what we have experienced with the iPhone, there are likely more than a few developers right now working on novel applications that clinicians will find valuable. Question is: Will they be valuable enough to augment the extra weight and volume of lugging the iPad versus a smartphone?

Only time will tell.

That being said, based on initial impressions of physicians, such as the one from BIDMC (see above) and our own limited experience in using the iPad this week, the iPad is pretty incredible and could usher in a whole new approach to healthcare IT (interfacing to and interacting with an EMR/EHR system) that may result in physicians adopting and using such technology, willingly.  Could we even go so far as to say that the iPad will be a bigger contributor to HIT adoption and use than the $40B in ARRA funding that the feds will spend over the next several years as part of the HITECH Act?

Again, only time will tell.

Appendix:

Some other perspectives on the iPad in healthcare:

Article in HealthLeaders with some interviews with med professionals buying an iPad at Apple store in SanDiego.

ComputerWorld article looking at various business sector (including healthcare) uses of iPad.

Post by iPhone iMedicalApps on some of the current challenges for those adopting an iPad for medical use (virtually all the problems listed will be resolved within next few months)

Another post, this time at iPhoneCTO looks at the iPad in the med space for workforce mgmt.

Well look at this!  Children’s Hospital here in Boston announced today (4/8/10) that it has received one of the recent HHS innovation grants to “…investigate, evaluate, and prototype approaches to achieving an “iPhone-like” health information technology platform model…”

Another ER doc writes a review of the iPad.

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