Electronic Health Records (EHRs) are all the rage these days. Beyond meaningful use, I suspect that EHRs are hot in part because Silicon Valley dreamers are frustrated with our unsustainable curve of spending on healthcare. There is not a silver bullet for bending this curve. It takes courage and actions. Some solutions are politically hot potatoes, such as allowing more bright young men and women to enter medical schools and serve a profession desperately in need of supply. Others are ethical dilemmas, such as whether we should divert medical resources from end-of-life care toward the care of younger populations. Since Silicon Valley geeks can’t change any of that, they focus on what they can change: the way information is handled in medical practice.
At HIMSS 2011 there was much insight to be gained… for those able to see past the multicolored booths, neon lights, walking golden suits of armor, contortionists, magic shows, free beer, luminaries gathered behind closed doors to forecast the future. Just after dawn on Monday morning, several of these luminaries gathered in the Peabody Orlando Hotel for a panel hosted by Intel Corporation to address the future of Accountable Care Organizations (ACOs). Among these experts were Eric Dishman, Intel Fellow and Global Director of Health Innovation & Policy, Michael Young, President & CEO of Grady Health System, Dr. Steven Waldren, Director of the Center for Health IT for the American Academy of Family Physicians, and Aneesh Chopra, CTO of the United States.
At the outset Chopra voiced the question begged in any discussion of ACOs. Will America solve the healthcare value crisis by traveling back to the ‘90s HMO risk sharing model, or by encouraging a bold, grass-roots, provider-centric transformation? Fundamental changes in our incentive system can enable the delivery ecosystem to meet the country’s need, Chopra asserted, as a more aligned payment and information infrastructure shifts the focus from volume to innovation, from billing to value, and from silos to collaboration. Here, Chopra says, the Center for CMS Innovation can take a lesson from private-sector technology management and create an innovation pipeline founded on experimentation, prototyping and scale. Moreover, relative autonomy from Congress will encourage “a safe place in data-driven evidence-based prototyping,” within which the Innovation Center can catalyze intelligent ACOs.
It will be, Chopra predicts, a “kumbaya party with commercial payers,” a system where new ideas don’t just come from vendors, they come from the customer base, from solo practitioners, from large IDNs, from nurses and specialists and patients. Far from revisiting the ‘90s, this ACO version 2.0 environment can leverage increased customer technical expertise to create an apps economy that is infused with interoperability. There will not be a single killer app, but instead a platform enabling providers to act as spec manager for the IT requirements of this innovation engine. This arrangement will renew the focus on consumer-directed apps that better connect the family and caregivers, and give patients tools that integrate into their activities of daily living. With more than 40% of Americans on smart mobile devices, smart providers with aligned incentives will dream up new applications interoperating into Facebook and freeing data that reaches beyond resource-constrained primary care physicians. No matter how penetrated health IT may become, better patient engagement in the process will support the shift to the ECO – the Enlightened Care Organization – facilitated by sites like patientslikeme.com that surround the patient with community. This new world, Chopra says, is “not about forcing people to be educated on what’s possible, but about tools to make [the possibilities] seamless.”
Yet with increased regulatory scrutiny on HIT apps and the accelerating speed of obsolescence, questions remain about how to incentivize development while ensuring the benefit of new apps exceeds their risk. How, the audience asked, can developers accelerate the pace of the evidence base? Interestingly, the luminaries on the panel predicted a limited role for prospective randomized controlled trials (RCTs). With applications completed now in days that in the ‘90s would have taken years, a mechanism is needed to show value quickly. Instead of prospective RCTs, the pundits predicted that it may be more effective for applications to leverage pilots that gather data via retrospective observational field studies. After all, once the Meaningful Use incentive horizon has past, HIT apps will win with customers by keeping patients out of the ER, identifying earlier those at risk for chronic disease and reporting the value added to payers and patients. Yet while the question of how to achieve this mechanistic shift using observational data in a manner compliant with regulatory constraints is critical, it seemed less pressing than the question of globalization. Given the scale with which apps leveraging health data sets are developed in the EU and BRIC regions, Chopra asks is “will the American economy be an importer, or an innovator and & export [HIT] systems around the world?”
A culture of “frugal engineering,” is what is needed, according to our nation’s CTO. A lean, adaptable technological evolution aimed at the bottom of the delivery pyramid is critical given that fewer than 10% of hospitals in the US have more than 400 beds. “We’re in the ‘good enough’ business,” Chopra says, hoping that this foundation of systematic innovation pipeline development will make healthcare sufficiently adaptive to respond to changes driven by biotechnology breakthroughs, budget crises, IT adoption and a generation of aging baby boomers. “This,” he says of the policy framework opening the door for a new generation of accountable care organizations, “will be the spark.”
Much ado has been made about Accountable Care Organizations lately, between the comments from AHIP, the AMA, CHIME, not to mention pundits criticizing the programs as ‘fiascos’. History may judge this turmoil as baby steps towards progress, but among the debate around patient centered medical homes, retrospective attribution, performance reporting and shared risk, is a connection that is under-discussed: The underlying criticality of reliable health information exchanges as a necessary, though not sufficient, condition of effective ACOs. Certainly, other causes of reluctant initial enrollment in the Medicare Shared Savings Program, such as reimbursement risk and consumer engagement, must be addressed to successfully transform care delivery. But even among ACO pilots with commercial payers, a connectivity arms race is amassing between providers and payers maneuvering to control a key lynchpin of accountable care: information.
After all, accountability can’t be established if capital-constrained organizations can’t track patients moving between providers and measure how services provided across settings of care contribute to cost and outcomes. Analytics and risk adjustment are well and good, but without access to the underlying data none of the fancy math or performance dashboarding has a chance of reflecting reality. The recent acquisitions of health information exchanges Axolotl and Medicityby Ingenix and Aetna indicate this recognition by two of the most powerful payers in the country. Conversely, recent alignment of large provider systems to state-sponsored health information exchanges, like Centura hospitals joining Colorado’s Health Information Exchange, exemplifies providers that are savvy to the power of connectivity. The guarded optimists are no doubt hoping that all this information sharing will enable the titans of managed care and integrated delivery to collaborate better around patient-centricity. The doomsayers are no doubt waiting for this information battleground to invade privacy, drive price collusion and generally make US healthcare even messier. I suppose I’m with the optimists, but only time will tell which side predicted the winds of US healthcare correctly.
Of course, the march toward health system connectivity, and the accountable care that it will enable, could be accelerated with a little less claim-jumping by the keepers of all this information. Beyond addressing stakeholder concern with a lack of clarity about how Meaningful Use and ACO performance inter-relate, regulators could take greater steps to enable the information transparency necessary for ubiquitous connectivity. It is understandable that data around privately contracted rates or claims represents competitive advantage and should be kept confidential. But public payer data is different. While sharing information like Medicare claims data around provider quality and safety recently released by CMS is an important step, it does not go far enough. These claims should be anonymized to ensure HIPAA compliance and made publicly available to any request, not just “qualified entities.” Since public claims are paid for with taxpayer dollars, every U.S. citizen has need-to-know clearance, making the cherry picking of who may see these data is philosophically anathema to the Open Government Initiative. Connectivity is critical for care transformation, and data is critical for connectivity, so until these public rates are transparent, Americans will continue to be shortchanged.
But let all the finger-pointing not be directed at policy makers. The Open Government Initiative is a groundbreaking measure of good faith. The interest of entrenched healthcare organizations in care transformation is a watershed event, even if the outcome remains uncertain. Progress is happening. What remains is to push these models from the drawing board into the operating room is consumer demand. Even if CMS made all data fully transparent, it would still be up to us to consult and behave consistent with where the data points to value. Until educated consumers refuse to see providers who lack clinical integration capabilities; until employers demand real-time cost estimates from their managed care vendors and physician networks; until patients are incentivized to seek out value, world-class healthcare will not materialize.
So let’s point a few fingers at ourselves, while we’re at it, and empower fellow consumers to require connectivity as the cost of entry for healthcare companies claiming to be focused on us. ACOs meandering towards value-centricity are keeping an eye on the consumer health IT market, and for good reason. With half of US consumers willing to pay for devices and apps monitoring vital signs, there is an increasing involvement by patients in their own health. Information transparency could enable markets for applications built “by consumers, for consumers” hunting for value. If apps like this exist for buying gas, there’s no reason they couldn’t be built for healthcare. Hyper-regulation, information asymmetries and perverse incentives are barriers to value, true, but in this climate of change, the guarded optimists among us may find ways of leveraging the power of the consumer market to bend the healthcare cost curve. Only by contributing to this foundational capability will we as consumers help to drive care delivery beyond meaningful use toward a connected health system that makes sense.
Last week, four UC Berkeley MBAs flew 8,700 miles to Bangalore, India, to innovate mHealth business models for the country’s remote hinterland. As part of a course in international business development, the Berkeley team is consulting with Foundation Research on Health Systems (FRHS), a not-for-profit NGO operating in Dehli, Ahmedabad and Bangalore. In operation since 1989, FRHS has been developing surveillance programs leveraging health information systems to monitor and care for women and children in rural India, focusing on strengthening the existing health system across the country. It seems intuitive that mHealth could augment the effectiveness of India’s healthcare given the rapid penetration of mobile devices and infrastructure disparities between densely populated cities and the rural countryside. Equally salient are the significant opportunities for business and social change if mobile app developers can meet the needs of hundreds of millions of rural inhabitants. Thus, it is in this promise for better patient access to care that the developing world holds valuable lessons about bringing health innovations to new markets.
The first lesson from the FHRS effort is the need for sufficient access to financial and intellectual startup capital – a must for entrepreneurs operating even in the wealthiest economies. With a grant from the Welcome Trust and partnerships with the World Health Organization and the Columbia Earth Institute, FRHS has the resources necessary to pilot these programs in a challenging environment. The Earth Institute, for example, had successfully piloted similar programs in Kenya, and lent considerable expertise to the program in India. These resources are made all the more critical by the fact that although consensus opinion perceives vast potential for NGO mHealth initiatives, many such programs die within two years. Shut down is often due to a lack of infrastructure to measure and evaluate performance, leading to funding shortages before a sustainable business model can be implemented around real world results. Sound familiar? A similar story could be told about many healthcare ventures in mature markets, whether as part of VC-funded start-ups or growth business units in market leaders.
As such, the second lesson that may be observed from the FRHS effort is that start-up capital for innovative technology is not enough. A realistic business model must be in place from day one for a new commercial offering or not-for-profit program to thrive. In the case of FRHS, while management hails from some of the foremost public health and technology organizations, little consideration was historically given to effective models for sustaining and scaling their operation. Management wisely recognized this gap, and reached out to partner organizations, including the Berkeley-Haas School of Business, to help develop a market sustainability model. To accomplish this, the Berkeley team first characterized the drivers of FRHS’ value proposition by leveraging a suite of innovation concepts, such as design guru Alexander Osterwilder’s business model canvas. By examining opportunities for partnerships, supply chain efficiencies, and feature set development, the team is working to help FRHS realize self-sufficiency as it engages with donors and government in one of the world’s most populous and rapidly growing nations.
In this process of engaging FRHS and their customers is the third lesson of the FRHS effort. The creation of applications that customers not only realize they benefit from, but also are customized to their specific culture, socioeconomics and health needs must be the singular focus of any HIT app developer. Regardless of what patients or markets they serve, if customers can’t seamlessly integrate a new tool or toy into their daily lives, precious innovation is wasted. And so, after arriving in Bangalore, the team traveled 150 kilometers to Mysore, to meet with physicians and community health workers far outside the city. For three weeks, they will perform a detailed customer needs assessment for rural communities that rank among the world’s most dispossessed.
To be sure, many aspects of Indian healthcare are vastly different than in the US, but in this sense, healthcare ventures in the Indian interior operate in a strikingly similar way to those in Silicon Valley. Even where low literacy rates and sporadic access to health services hinders care for countless millions, the process of translating a technically adept application into an intuitive, patient-friendly product requires forethought, resources and time. Sometimes, strategies for serving the top of the pyramid can also be applied to the base. Savvy commercial innovators realize that rich or poor, the same basic biological and social pressures mold our behavior. People are people, and as such, it shouldn’t be surprising if business models launched halfway around the world to increasingly find new markets close to home.
Health reform offers a significant step forward for preventative care, as long as the system can meet increased capacity demands. With higher reimbursement and subsidized primary care coverage for patients, the government is actively incentivizing patients to seek preventative health measures and medical students to consider family medicine over higher-paying specialty practices. However, physician shortages and capacity-constrained infrastructure pose a risk to expansive primary care in the US.
Fortunately, the Affordable Care Act offers cost sharing measures, such as waivers of coinsurance and deductibles, for eligible patients seeking primary care and prevention services, starting for all new plans initiated after September 2010.
Unfortunately, in 2010, the Association of American Medical Colleges forecasted a need for a 12 percent increase in family medicine physicians to meet the growing demand for services, despite declining rates of medical students choosing primary care. Understanding the need for this carrot, health reform authors built incentive structures to attract physicians to family medicine, including a 10 percent Medicare boost in primary care payments. Still, the network of physicians is significantly lacking and poses a risk to the emphasis on expanded prevention services.
Existing infrastructure, or the lack thereof, also threatens the reform’s emphasis on more widespread preventative care. According to an American Hospital Association survey, 80 percent of urban hospitals reported their emergency departments as “at” or “over” capacity, and the study found that a key to relieve bottlenecks lies with expansion of non-urgent care capacity. With more profitable specialty center options, hospitals aren’t racing to build more family medicine clinics.
We’re facing a pivotal point in healthcare, with the opportunity to leverage reform incentives to reduce cost and improve patient outcomes through prevention and primary care. With capacity constraints and physician shortages, there’s hope in the convenient care clinic industry. Companies like CVS’s MinuteClinic, Walgreens’ Take Care Clinic, and Target Clinics are positioned well to handle the growing demand for convenient, affordable and accessible primary care. They use nurse practitioners with physician oversight and technological advancements to execute a low cost and high volume business model, while working with patients’ other physicians to coordinate the quality of care. Gone may be the days of four-hour urgent care visits for an ear infection or skipped annual exams because a patient doesn’t have the time, money or physician relationship to make an appointment.
We have reasons to be optimistic about primary care expansion, thanks in part to the growth in private, low cost retail clinic chains. The hope is that, someday, it will be as convenient, affordable and common to get a physical examination as it is to get your car’s oil changed.
Leia is a former Revenue Cycle provider consultant from Stockamp, Huron Healthcare and is currently pursuing her MBA at UC Berkeley’s Haas School of Business.
On March 22nd and 23rd, the Institute for Health Technology Transformation (iHT2) Summit in San Francisco held their seventh annual conference, bringing together local health system executives, health IT vendors and policy pundits.
After two days of panels and workshops addressing a broad range of HIT topics, the final panel, “New Models and Practical Approaches: Developing an IT Strategy for the next stages of Meaningful Use” attempted to tie these disparate topics together from a health system perspective.
Represented on the panel were the San Francisco Department of Public Health, California Pacific Medical Center, Anthem and NorthBay Healthcare, yielding substantial organizational diversity across providers and payers from the private and public sectors.
Despite the panel’s title, the conversation focused less on Meaningful Use and EMR Incentives, instead addressing the perennial challenges of vendor selection, interoperability, resource allocation, return on investment and innovation.
The group was refreshingly candid about the challenges faced by organizations large and small, and seemed committed to progress towards outcomes-focused delivery. Yet as the panel observed, after decades of the healthcare industry systematically eluding technology adoption and innovation, the expectation to build a fully interoperable health IT information system in a handful of years is aggressive to say the least.
Naturally, cost was a major focus for all the stakeholders, given the shift from IT as a perfunctory billing platform to the keystone for clinical decision-making and quality reporting. The panel estimated that health system IT investment would need to increase from its current ~2-3% of annual spend to ~4-5% of expenses, as it is in financial services. The challenge, of course, is that health system margins are somewhat thinner than those of investment banks. Combine that with the fact that efficiencies created from expensive health IT implementations and EHR adoption include a reduction in unnecessary reimbursable procedures, and it’s unsurprising that hospital CFOs have questioned the business case for all this progress.
And yet, the “perfect storm” of the HITECH and PPACA acts has created an environment in which it seems as if every health system initiative depends on the IT department. Panel anecdotes suggested that whether implementing a single end-to-end application (like Kaiser Permanente with Epic) or employing a best of breed approach (like the SF Department of Public Health with bolt-on apps for inpatient, ambulatory and behavioral health), close vendor partnerships can enable the flexibility and functionality that health systems need to meet their planning objectives. As such, the panel observed that vendor transparency about the length of their development cycle and the extent of interoperability within their consolidated product portfolios is critical to maintain good relationships with health systems.
The panelists also predicted that this increased demand for interoperability will slowly drive foundational EMR apps towards commoditization. If the future is an outcomes-focused ecosystem of Accountable Care Organizations (ACOs), then regardless of whether health information exchanges are public utilities or toll roads, the real prize is not data but the meaning mined from all this information. Implied between the panel’s anecdotes was the hope that vendors will focus less on drawing battle lines around their EHR repositories, and more on reinvigorating healthcare with what the tech sector does best: designing tools that enable business intelligence.
Of course, even if competing vendors will interoperate with each other and enable information exchange, health systems still face a laundry list of mission-critical initiatives competing for time and resources. If Meaningful Use, ICD-10 / 5010 conversion, HIPAA compliance, publicly-reported patient satisfaction, EMR use, quality initiatives and the good old delivery of medicine aren’t enough, sufficient facilities infrastructure must also be built to enable technology and process initiatives. As the panel observed, health systems must cultivate first and foremost a core competency of prioritization. Which, let’s face it, is easier said than done. When the panel asked anyone in the audience to raise their hands if they thought their organization was good or very good at prioritization, not a single hand went up.
Acknowledging the challenges of prioritization, the panel suggested focusing on small tasks for which even a week-long micro-experiment could help deliver progress. For example, a single discharge sheet that is the final touch point between the hospital and patient has the potential to be incredibly impactful if well designed, reducing re-admissions and improving the continuity and quality of ambulatory care. But it is not always simple for health systems to focus when they must continuously deliver a full suite of care to a genetically and socioeconomically diverse population.
So what are the metrics that health systems should use, via electronic medical records etc., to identify how to prioritize initiatives? Here the panel offered many talking points but few guiding principles. Fortunately, a question from the audience was raised to the panel about where patients fit into all this strategic planning. The panel’s candid answer was that today patients are not engaged by providers enough, but that health systems need to adapt as patients increasingly become the center of medical homes and ACOs, not to mention the arbiters of their own consumer-driven health plans.
Redesigning bottlenecks of capacity or quality like the discharge sheet with the patient-as-customer in mind is the best way to create long term value for health systems in the future world of information liberation. It is the delivery of this value to the market – or the threat of competitors delivering it first – that may help convince even the most frugal CFOs of the business case for building tomorrow’s intelligent health system.
At the 5th annual UC Berkeley-Haas Business of Health Care Conference, 250 students, academics, industry professionals and pundits gathered at the Haas School of Business to discuss healthcare innovation. With topics ranging from genetic testing and medical devices to former California HHS Secretary Kimberly Belshe’s talk on the state health insurance exchange, the Conference was an opportunity to network with thought leaders and forecast the future healthcare environment. Among the many student-run panels, three on accountable care organizations (ACOs), mHealth and health information exchange (HIE) examined how systems and technology may evolve to build the future backbone of healthcare – if, that is, we can enable a business case for innovation.
In a panel entitled “Accountable Care Organizations – Doing More With Less,” Arnold Millstein of Stanford University presented his framework for establishing innovation in healthcare delivery. Dr. Millstein’s framework creates a parallel to the super-efficient automobile, winner of the recent X-Prize, for how nimble entrepreneurs can create innovative designs despite being under-resourced. Indeed, Dr. Millstein’s pilot programs have shown real cost reductions in the market place using collaborative approaches in ambulatory settings with fragmented provider networks when consumers (in this case, large employers), stepped up and flexed their purchasing muscle to demand quality. Ironically, at contract renegotiation time, the networks in these pilots decided they deserved more than 50% of the established cost savings, causing the long-term arrangement to break down. What is the secret, Dr. Millstein asked his panel, to enable ACOs to sustain improvements in healthcare value?
Gordon Yenokida of Catholic Healthcare West and Lance Lang from Mercer engaged Dr. Millstein with their own delivery system and benefit design perspectives on ACOs. While constructing ACOs may be challenging enough, they said, their existence will not be enough to automatically realize cost savings. As many have observed, there will be a fine balance between cost savings due to efficiency and increased provider pricing power as a result of consolidation. Of three breeds of ACOs, Dr. Lang contends, health insurers will be less concerned about large, heavily matrixed, integrated health systems like Kaiser Permanente or diffuse alliances of community physicians. It is the third breed, the hospital / health system alliance with their contracted networks, that has insurers skeptical about cost savings.
With the inception of the recent CPMC / Brown & Towland and CHW/UCSF/Hill alliances with Blue Shield, it’s clear that not only do health systems see the potential in strategic consolidation, but so do progressive insurers looking for innovative business models. And the opportunities for cost savings are plentiful, stretching from fewer ER readmissions and over-utilized surgeries to better patient engagement. The panel contended that in ACOs formed under multi-year contracts, patients who better understand the real costs and benefits of their care, and are given a place at the table as a decision-maker, help return a substantial portion of savings to the community.
“Opportunities and Challenges of the mHealth Revolution” was the next panel, led by Elise Singer, co-founder of Doximity and Chief Medical Officer of CalHIPSO. With so much buzz over mHealth, between 3M’s digital stethoscope rocketing to the International Space Station and specialized incubators like Rock Health, the panelists debated how much of mHealth was fact vs. fantasy. The panel astutely observed that mHealth seems ubiquitously spelled with a small ‘m,’ perhaps because mobile applications are only valuable in the health system to the extent they improve health – by increasing quality and access or reducing the cost of patient care. So while there is tremendous potential with the adoption of smart mobile technology, the panelists gave only two examples of apps considered successful, one globally and one app playing in the US market.
At the risk of editorializing, the US example, WellDoc, is an elegant and value-add app, because, well, it improves outcomes for diabetics. The founders spent years gathering evidence, finally getting FDA approval only after showing that the app reduced HbA1C levels. These regulatory tribulations and recent partnership between WellDoc and AT&T illustrate how high the bar is to realize the potential of mHealth. Conversely, while there is much ado about the wellness app revolution, few sustainable monetization models have been proven. So while I am the first to advocate for a new wellness app ecosystem as a pillar of the long-term solution to a morbidly obese nation, if I were a short-term mHealth entrepreneur I would do as the panel recommended and follow the incentives. Make your venture capitalist proud: prevent a chronic illness with your app today!
“Understanding and Navigating the Health Information Exchange” was the final main panel of the day, which, in full disclosure, I helped organize with two of my fellow students. After Carladenise Edwards, CEO of Cal eConnect, spoke about the importance of health information exchange (HIE) to realize cost savings of health information technology, a diverse panel debated whether barriers to implementation would hamstring this promise. Ben Wilson, Director of Intel’s Global Healthcare Strategy, observed that interoperability is less of a technical constraint than an organizational barrier, a competitive advantage exacerbated by single-system platforms providing end-to-end solutions to large health systems. Andrea Sim, VP of Product Management for RelayHealth concurred, adding that it is precisely this competition from single-system solutions like Epic that is stimulating innovation from HIE vendors, so that providers using best-of-breed systems need not sacrifice performance.
Of course, such performance equivalence remains a few years out. As Howard Landa, Chief Medical Information Officer of Alameda County Medical Center argued, while HIE is among the most technically complex feature of health data systems, most of the Meaningful Use EMR incentives will be spent before providers demonstrate true electronic medical records data exchange. This suggests there is dubious evidence for a business model that will fund construction of America’s health information highway. Nevertheless, Jamie Ferguson of Kaiser Permanente commented that linking KP’s system with the VA is evidence that, when expertly implemented, health information exchange can be the difference between life and death for patients. As for where HIE adoption may be in 5 years, Ms. Sim seemed bullish that ACOs would enhance the business case for data exchange enabling interoperable HIT components. Dr. Landa and Mr. Wilson were more skeptical of this, while Mr. Ferguson seemed blissfully unwilling to prophesize. As he observed, with medicine requiring orders of magnitude more data elements than finance or real estate, constructing a health information highway may be critically important for the future of healthcare, but it is also one of the most challenging endeavors society has ever undertaken.