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Overview of the Health Care
Analytics Market
BI Needs Outpace Vendor Tools and
Health-Care Organizations’ Capabilities
Health Care IT Advisor
©2014TheAdvisoryBoardCompany•28068C
Poll #1 - Primary Role
2
What is your primary role? – 262 respondents
A. Finance – 10%
B. Clinical/Quality – 25%
C. IT – 25%
D. Executive – 25%
E. Operational – 14%
©2014TheAdvisoryBoardCompany•28068C
2
3
1
Road Map
3
The Ever-Changing BI Marketplace
BI Requirements and Challenges
Beyond Population Health Management –
The Coming Retail Revolution
©2014TheAdvisoryBoardCompany•28068C
Staying Afloat Through Cross-Subsidization
Source: American Hospital Association, “Trendwatch Chartbook
2014,” available at: www.aha.org; Health Care Advisory Board
interviews and analysis.
Our Existing Business Model
Hospital Payment-to-Cost
Ratio, Private Payer, 2012
149%
Hospital Payment-to-Cost
Ratio, Medicare, 2012
86%
• Above-cost pricing
• Robust fee-for-service
volume growth
• Steady price growth
• Only one component of
our total business
Commercial Insurance Public Payers
Below CostAbove Cost
Traditional Hospital Cross-Subsidy
4
©2014TheAdvisoryBoardCompany•28068C
Roles of Payers, Providers, Patients Traditionally Stable
Source: Health Care Advisory Board interviews and analysis.
A Strategy Dependent on Well-Worn Channels
Established Provider
• Expect steady public-
payer, commercial
price growth
• In-network for most
plans
Entrenched Payer
• Maintain broad
provider networks
• Pass excess cost
growth on to
employers through
brokers
Price-Insulated Patient
• Open access to broad
provider network
• Seek care with little
concern for out-of-
pocket payment
Assumptions Underlying Provider Growth Strategy
5
©2014TheAdvisoryBoardCompany•28068C
Nearing the Limits of Extractive Growth Strategies
6
Legacy Growth Levers Increasingly Time-Limited
Source: Health Care Advisory Board interviews and analysis.
Traditional Hospital Growth Strategies
Scale and Pricing Power
Demand Price
Increases
Emerging Limitations:
• Shrinking population
of commercially insured
patients
• Rise of stealth and
contingent rate cuts
• Activist purchasers
refusing price increases
Consolidate Market
Position
Emerging Limitations:
• High degree of existing
consolidation in major
markets
• Heightened scrutiny
of hospital mergers
• Limited capital available
for acquisitions
Lock Up
Referral Streams
Emerging Limitations:
• Fewer physicians remain
unaffiliated
• Increased scrutiny
of practice acquisitions
• Elevated competition from
other health systems,
physician aggregators
©2014TheAdvisoryBoardCompany•28068C
Three Trends Threatening the Traditional Provider Business Model
Source: Health Care Advisory Board interviews and analysis.
1) 1. Health Insurance Exchanges
Impending Collapse of the Cross Subsidy
Medicare Payment
Innovation
• A growing wave of
Medicare beneficiaries
• Reductions in FFS
payments
• New mandatory and
optional risk-based
payment models
• Growth of Medicare
Advantage
Market-Based
Medicaid Reform
• Growth of Medicaid
Managed Care
• Commercialization
through “Private Option”
Increased Commercial
Market Competition
• Many private employers
shifting to private
exchanges or converting to
self-funding
• New dynamic
individual market on both
public and private HIXs1
• New channels for
competition in group
market
1 2 3
7
©2014TheAdvisoryBoardCompany•28068C
Which of these three trends worries you the most? – 236 respondents
A. Medicare payment innovation – 38%
B. Market based Medicaid reform – 19%
C. Increased commercial market competition – 43%
Poll # 2 - Trends
8
©2014TheAdvisoryBoardCompany•28068C
Disrupting Traditional Channels of Coverage
Source: Congressional Budget Office, “May 2013 Estimate of the Effects of the Affordable Care Act on Health Insurance
Coverage,” available at: www.cbo.gov; Accenture, “Are You Ready? Health Insurance Exchanges Are Looming, “ 2013,
available at: www.accenture.com; Kaiser Family Foundation, “The Coverage Gap: Uninsured Poor Adults in States that
Do Not Expand Medicaid,” April 2, 2014, available at: www.kff.org; Health Care Advisory Board interviews and analysis.
1) Based on number of lives falling into the “Medicaid expansion
gap” in non-expansion states.
2) Based on the number of Medicare Advantage enrollees.
A Burgeoning Retail Market
25M
87M
5M
40M
17M
Public
Exchange
"Private Option"
Medicaid
Expansion
Private
Exchange
Medicare
Exchange
Total Retail
Market
Projected Size of the Potential Retail Market
2018
1
2
9
©2014TheAdvisoryBoardCompany•28068C
Designing Around Purchaser Preferences
Source: Health Care Advisory Board interviews and analysis.
From Individual Inputs to Consumer Products
Office Visits
Imaging
Lab
Emergency Care
Inpatient Procedures
Outpatient Procedures
Wellness Programs
Long-Term Care
Pharmacy
Product
Packaging
Shoppable Procedures
Diagnostics, surgery, follow-up
care, planned treatments
Emergent Care
Low-to-mid acuity urgent care,
emergency care
Enhanced Management
Care/disease management,
wellness, ongoing primary care
Current Health Care Production Model
©2014TheAdvisoryBoardCompany•28068C
Multiple Opportunities To Appeal to Decision-Makers
Source: Health Care Advisory Board interviews and analysis.
Winning Share at Two Points of Sale
Network Selection Care DecisionNetwork Assembly
Decision Processes Involved in Provider Choice
Being chosen by payers, employers,
exchange operators, custom network
builders, and accountable physician
entities to be offered as a network option
Being chosen by
patients at the
point of care
Being chosen by
individuals during
enrollment
Secure Enrolled Lives Win Share of Volumes
1 2
11
©2014TheAdvisoryBoardCompany•28068C
Source: Health Care Advisory Board interviews and analysis.
Capturing New Channels of Growth
Established
Provider
Care Delivery
Network
Relationship-Based
Referring Physician
Cost-Conscious
Referring Physician
Price-Sensitive
Consumer
Entrenched
Payer
Vulnerable
Payer
Activated
Employer
Exchange
Operator
Custom Network
Builder
Secure Enrolled Lives Win Share of Volumes
Traditional
Growth
Channels
New
Growth
Channels
Key Decision-Makers in Traditional and New Growth Channels
Individual
Insurance Shopper
Accountable
Physician Entity
12
©2014TheAdvisoryBoardCompany•28068C
Catalyzing a Shift in Network Demands
Source: Health Care Advisory Board interviews and analysis.
No Longer Insulated From Market Forces
Traditional Market Retail Market
Growing number of buyers
1
Proliferation of product options
2
Increased transparency
3
Reduced switching costs
4
Greater consumer cost exposure
5
Passive employer,
price-insulated employee
Activist employer,
price-sensitive individual
Broad, open networks Narrow, custom networks
No platform for apples-to-
apples plan comparison
Clear plan comparison
on exchange platforms
Disruptive for employers
to change benefit options
Easy for individuals to
switch plans annually
Constant employee
premium contribution,
low deductibles
Variable individual
premium contribution,
high deductibles
Characteristics of a Traditional vs. Retail Market
13
©2014TheAdvisoryBoardCompany•28068C
2
3
1
Road Map
14
The Ever-Changing BI Marketplace
BI Requirements and Challenges
Beyond Population Health Management –
The Coming Retail Revolution
©2014TheAdvisoryBoardCompany•28068C
Expand Your BI Focus for PHM3 and Retail Revolution
15
Operational Improvement Is Not Sufficient for Transformation
Source: Health Care IT Suite research and survey analysis.
1) Health Care IT Suite BI Survey, April 2012.
2) Marsha Gold, Helms, David, Guterman, Stuart, Identifying, Monitoring, and Assessing Promising
Innovations: Using Evaluation to Support Rapid-Cycle Change, The Commonwealth Fund, June 2011.
3) Population health management.
4) Clinical decision support.
Successful Reinvention
The right time to rethink the business
model and supporting culture—for the
two must go together—is before you
get into trouble, not during, or after,
when resources are scarce and fear is
contagious.
26%
24%
20%
16% 14%
CDS4/Evidence-
Based Pathways
Quality
Reporting
Operational
Efficiencies
Cost
Management
Revenue/
Contract
Reporting
Currently, providers do not have sufficient data about the clinical or financial experience of their
patients; these data are important to manage patient care and financial risk effectively as well as
to support rapid-cycle performance evaluation and targeted improvement efforts.
”
Commonwealth Fund Study,2 July 2011
Foci of Current BI Efforts1 Still Relevant
Bill Fischer
Forbes Blog, April 2013
”
©2014TheAdvisoryBoardCompany•28068C
Examples of Key BI-Related Capabilities for the Four Retail Imperatives
Source: Advisory Board Company research and analysis
BI Technologies Key to Redefining “Value”
Essential Nice to Have Future Need
Geographic
Reach and
Clinical Scope
• Service line planning
• Facility planning
• Referrals analysis
• Network modeling (for
narrow networks)
• Facility optimization
• Population-based
planning
Clinical and
Service Quality
• Quality scorecards
• Patient satisfaction and
loyalty monitoring
• Site-specific CDS
• CDS on integrated data
• Access / scheduling
optimization
• Predictive modeling for
consumer behavior
• Persuasion modeling for
consumer behavior
• Personalized care
• Cognitive support
• Social media analytics
Low Unit Price • Pricing monitoring and
benchmarks
• Supply chain
monitoring
• Resource monitoring
• Cost accounting
• Supply chain
optimization
• Resource optimization
• Real-time costing data
• Dynamic pricing tools
Total Cost
Control
• Contract modeling
• Risk stratification
• Physician performance
• Service line
performance
• Registries
• Cost accounting
• PHM scorecards
• Real-time risk
identification
• Real-time referral
analytics
• Patient-reported data
• Patient-reported
outcomes
Desirable
Network
Attributes
LowCost
16
©2014TheAdvisoryBoardCompany•28068C
• Contracting (pre/post)
• Performance scorecards
Administer,
Monitor, and Report
6
Analytics Enabling Population Health Management
17
Examples of Tools and Processes with Analytic Underpinning
Source: The Advisory Board Company research and analysis.1) PHM = population health management.
• PCP attribution
• Risk segmentation
– Frequent utilization
– Chronic conditions
• Disease or PHM1
dashboards
• Registries
• Smart portals
Map and Track
2
• Registries
• Assisted interventions
– Clinical decision support
– Cognitive support
Deliver Care
3
Identify Population
1
• Real-time monitoring/alerts
• Registries
• Risk reassessment
• Pathway optimization
Coordinate Cross-
Continuum Care
4
• Predictive/persuasive
engagement
• Patient satisfaction
Engage Patients
5
©2014TheAdvisoryBoardCompany•28068C
Assuring Employers of Ability to Manage Future Costs
Source: Health Care Advisory Board interviews and analysis.
Making the Case for Care Management Capabilities
“In our market, there is plenty of talk about ‘accountable care’, but
we are differentiating with the organizational commitment and the
infrastructure investment to sustain a new economic model.”
Chief Marketing Officer
Large Health System in the West
Investment in
Data Analytics
Shows capability to
assess patient risk
and pinpoint
interventions
Clinical and Claims
Data Integration
Illustrates advantage
over traditional
health plan
Demand for Out-of-
Network Claims Data
Shows commitment to
continuously manage
care for attributed
population
Telehealth Platforms
and Programs
Demonstrates ability
to keep low-acuity
cases in most
appropriate care site
Four Ways to Demonstrate Care Management Capabilities
18
©2014TheAdvisoryBoardCompany•28068C
Collecting Data for Analysis, Sharing Data for Care
19
Building a Network of Owned and Affiliated Entities
Source: Health Care IT Suite research and analysis.
1) Health Level 7.
2) Clinical Document Architecture/Continuity of Care
Document.
Physician
Offices
Hospitals
LTC Facilities
Patient
HomePayer
BI
Varied Mechanisms of Exchange
Public and Private HIEs, HL71 Messages, CDA/CCD,2 Custom Development
Patient
Retail
Clinics and
Non-Traditional
Providers
State
Lab
©2014TheAdvisoryBoardCompany•28068C
It Only Gets More Complex
Expanding the Data Collection Net
Internal
Structured
Data
External
Structured
Data
Internal
Unstructured
Data
External
Unstructured
Data
Transaction Data
Excel/Access
Medical Device
Sensors
CAD/CAM
Diagnostic Images
Claims
Pt Satisfaction
Survey Data
CDA Documents
Public Data
Benchmarks
Progress Notes
Procedure Notes
Discharge
Summaries
Word Documents
Scanned Consents
Email
Contracts
Social Networks
Email
Online Reviews
20
©2014TheAdvisoryBoardCompany•28068C
Developed by Jim Adams, Meg Aranow, Ernie Hood, and Dale
Sanders
1) Red cells indicate the primary distinguishing characteristic of each maturity phase.
2) EHR = electronic health record; ETL = extraction transformation loading; KPI = key performance indicator; MDM = master
data management; NLP = natural language processing; ODS = operational data store; SQL = structured query language.
The BI Maturity Model; 2014 Edition
Fragmented Enterprise Perspective Advanced Analytics Big Data
BI architecture None or several point solutions
Central infrastructure basics
implemented
BI core and self- service
infrastructure in place
Optimized infrastructure which may
include data marts, ODSs, and a
mobility platform
Data sources / data currency
Transaction application from one
system or BI tool specific from limited
number of internal source systems
ETL established to combine data
from primary sources such as EHR
and revenue cycle
ETL established for secondary data
sources and varied currency
including more frequently than daily
External sources including web,
patient-generated, and genomics
collected as real time and streaming
data
Types of analysis / use of
analytics
Automated internal reporting
Enterprise KPIs, automated external
reporting, segmentation (e.g. risk
stratification)
Predictive, prescriptive analytics,
data exploration, and hypothesis
generation
Analytics combining multiple and
complex data sources, cognitive
analytics, analytics for personalized
medicine
Data models
No or limited single-purpose
transformation
Consolidated approach of basic
models including dimensional, late
binding, and in-memory models
Multiple, optimized data models No schema
Data governance
None or limited departmental
decisions about use and usability
Common policies and standards,
centrally-managed priorities, shared
documentation, focus on data quality
and consistency
Data normalization, source system
changes, and maintenance
established
Active stewards of internal and
external data, complex analysis
review, data management practices
are pervasive
Tools
Independent choices for limited
purposes; redundant products
Centralized tool acquisition process
for basic data acquisition,
management, and visualization
Advanced analytic tools including
self-service
Specialized, targeted capabilities
including Hadoop and tools for
unstructured data
Skills
SQL, Excel, basic data modeling,
basic visualization
In-depth knowledge of physical and
logical data modeling, basic
statistics, and MDM use
In-depth knowledge of statistics and
operations analysis, procedural
programming
Apply NLP, genomics, and rules
engine programming; ability to
combine disparate data types
Culture / enterprise data
literacy
Value of data under-appreciated;
decisions based on no or limited data
Champions emerging and growing
emphasis on data governance and
fact-based decisions
Training on data literacy, identifying
BI opportunities, data exploration,
and data-driven changes
Engrained understanding of BI
capabilities and limitations
BI governance /
organizational structure
Local control
Central agenda and funding; core BI
and leadership teams established
Resources harmonized between
central core and stakeholder
departments; strong governance
processes in place
Includes relevant, external resources;
significant presence of distributed
analytics (SSBI)
21
©2014TheAdvisoryBoardCompany•28068C
Top 3 Challenges
22
Data Governance, Culture, Organization
Source: Health Care IT Suite research and analysis.1) N=41.
Findings and
Observations
• Institutions with less BI
maturity are more likely
to have data
governance as the #1
challenge
• There is a inverse
correlation between
transformation
challenges and the
presence of a BI
strategic plan
!
Cultural
Transformation
44%
Data
Governance
51%
BI
(Resource)
Organization
46%
©2014TheAdvisoryBoardCompany•28068C
2
3
1
Road Map
23
The Ever-Changing BI Marketplace
BI Requirements and Challenges
Beyond Population Health Management –
The Coming Retail Revolution
©2014TheAdvisoryBoardCompany•28068C
Poll #3 BI Vendors
24
How many BI vendors does your (or a typical) health system have? – 191
respondents
A. 1 – 9%
B. 2-5 – 54%
C. 6-10 – 22%
D. More than 10 – 16%
©2014TheAdvisoryBoardCompany•28068C
Fragmented BI Software Market
25
Our Survey Confirms That No One Is Using a Single Solution
Source: Health Care IT Suite research and analysis.
# of vendors # of
participants
=< 2 12 (43%)
3-4 7 (25%)
>= 5 9 (32%)
• Allscripts Analytics Module
• Aster
• Crimson
• Dimensional Insight Pro Diver
• Embarcadero
• Epic Cogito
• Epic Clarity
• EPSi
• Explorys
• HCD
• HealthCatalyst
• IBM - Cognos
• IBM - DB2
• IBM for centralized data
warehouse
• IBM InfoSphere
• IBM NLP
• IBM p770
• Informatica Powercenter
• Information Builders
• InfoSol Infoburst
• Inhouse-designed SQL
repository
• MCCM
• MedInsight
• Medisolv
• Meditech Data Repository
• Medventive
• MicroStrategy
• MSBI
• Oracle - DBMS
• Oracle - HDWF and Omics
Data Bank
• Oracle - OBIEE
• Phytel - Verisk
• PremierConnect Enterprise
• QlikView/Visual
Analytics/Exploration
• SAP Business Objects
Enterprise
• SAP Business Objects
Excelsius
• SAP Business Objects Suite
(Crystal, InfoView, Web-i,
Explorer)
• SAP Data Services ETL
• SAP Information Steward
(Profiling/Quality)
• SAS/SAS (Advanced
Analytics)
• Siemens DSS
• Tableau
©2014TheAdvisoryBoardCompany•28068C
Survey Results for Architecture and Tools
26
Architecture and Partners
25
9
16
18
18
9
9
8
4
70
64
52
41
32
39
26
23
12
15
5
4
9
9
9
9
15
12
5
23
28
32
41
44
57
62
68
77
Prescriptive Modeling
Advanced Analytics/Statistical Visualization
Predictive Modeling
Natural Language Processing
Master Data Management
Vocabulary and Semantic Management
Person Matching/Merge
Visualization Tools
Access Control and Auditing
Extract, Transform, and Load
No Plan to Purchase Included in Purchasing Plan Currently in Test Environment Implemented
Percentage of BI Tool Inventory and Purchasing Plan
Source: Health Care IT Suite research and analysis.
©2014TheAdvisoryBoardCompany•28068C
Different Roads to Take on Your BI Journey
27
You’ll Live in the Overlaps
Source: Health Care IT Suite research and analysis.
Build
OutsourceBuy
Solution Considerations
• Multiple point solutions
• Assess whether self-development
outpaces a rapidly growing vendor
market
• Cloud computing: cost vs. security
• Right-size solution set for your
organization’s needs and capabilities
Resource Considerations
• IT skill set requirements
• Business / clinical expertise
• Speed to delivery
• Need to customize
• Partnership culture
©2014TheAdvisoryBoardCompany•28068C
Use Deliberate Criteria to Choose Your BI Approach
28
Match the Approach to Your Organization's Strengths and Goals
Source: Health Care IT Suite research and analysis.
Broad-based functional capability to use
as a basis for self development to support
a belief that analytics is a differentiator
Enterprise Development Platform1
Stand-alone components with narrow but
deep subject matter expertise
Point Solutions3
Application (often bundled with infrastructure)
including process and analytic components,
for aggregation and comparison
Analytics-as-a-Service2
Analytic and process routines tightly
integrated with the transaction systems
EMR Subsystem4
©2014TheAdvisoryBoardCompany•28068C
Poll #4 Approaches
29
Which of these 4 approaches best matches your organizational strengths
and goals? – 234 respondents
A. Enterprise development platform – 29%
B. Analytics-as-a-service – 20%
C. Point solutions – 11%
D. EMR subsystem – 10%
E. Unsure or not applicable – 30%
©2014TheAdvisoryBoardCompany•28068C
Core Strategy: Enterprise Development Platform
30
Source: Health Care IT Suite research and analysis.
Consideration Potential Pros Potential Cons
Enterprise
Strategy
Belief that analytics can be a
clear differentiator
Flexibility supports still-
evolving strategies
Requires considerable
attention and focus from the
entire organization
Expertise
Provides a platform for
industry leadership
Requires business/clinical,
analytic and IT expertise with
a desire to innovate
Cost
Greatest startup costs
Governance
Required participation may
help drive cultural change
Provides no framework for
governance
Time to Value
Possibility to iterate quickly
for additional functionality
Slow initial time-to-value
Transition Effort
Full control of historical
export and transition
routines
May be difficult to transition to
less customized solutions
Agility
Highest degree of analytic
flexibility and adaptability;
good for heterogeneous
system environment
IBM
Oracle
Recombinant (by
Deloitte)
Healthcare Data
Works
Health Catalyst
Caradigm
Sample Vendors
©2014TheAdvisoryBoardCompany•28068C
Core Strategy: Analytics as a Service
31
Source: Health Care IT Suite research and analysis.
Consideration Potential Pros Potential Cons
Enterprise
Strategy
Inter-organizational
benchmarking and
comparative analytics
Currently limited abilities for
single analytic perspective on
patient care and costs
Expertise
Outsource the details of
analytics and data
management
Offers comparative analysis
Outsourcing limits ability to
tailor fit to organizational needs
Cost
Less startup expense than
platforms
Costs may increase quickly
Governance
Requires strong centralized
data governance to support
accurate aggregate analysis
Time to Value
Time to value is addressed
by basic starter kits
Starter kits may be incomplete
Transition Effort
Contract should ensure
efficient data packaging and
transfer
In-house skill set gaps
Agility
Best for reasonably
homogenous system
environments
Limited analytic flexibility and
adaptability for more complex
use cases
Sample Vendors
 Explorys
 Humedica
 Lumeris
 Premier Alliance
 Truven Health
Analytics
©2014TheAdvisoryBoardCompany•28068C
Core Strategy: Point Solutions
32
Source: Health Care IT Suite research and analysis.
Consideration Potential Pros Potential Cons
Enterprise
Strategy
May be used as an interim
solution against a larger
integrated plan
Does not provide a single
analytic perspective
Expertise
Provides expertise and
specific analytics in vertical
business and clinical areas
Analytics may not be
generalizable
Cost
Buy just what is essential Multiple solutions may be
costly and more complicated to
maintain
Governance
Narrow focus Challenges governance
models to create unified data
picture and use
Time to Value
Reduced time to value
Transition Effort
Smaller footprint allows
easier migration
New solution may be
challenged to go as deep
Agility
Can surround with other
products and services
Limited ability to customize
Sample Vendors
 AltaSoft
 Allscripts
 MedeAnalytics
 Medventive
 Midas+
 Omincell
 The Advisory Board
(Crimson)
 Cloudera
 Qlikview
©2014TheAdvisoryBoardCompany•28068C
Core Strategy: EMR Module
33
Source: Health Care IT Suite research and analysis.
Consideration Potential Pros Potential Cons
Enterprise
Strategy
Strong support for
operational analytics
May not be able to meet all
analytic needs
Expertise
Operational improvements
should benefit from
knowledge of transaction
systems
Current offers lack advanced
analytic capabilities
Cost
Governance
Requires tight integration
with operational governance
Time to Value
Basic functionality should be
quick to implement
Solution sets are still limited
Transition Effort
May be difficult to transition
away because of the power of
embedded workflow support
Agility
Vendor-supplied
enhancements may outpace
internal development
capabilities
Ability to incorporate and allow
actions to be taken on
external data is unproven
• Epic
• Cerner
• MEDITECH
• Siemens
• Allscripts
Sample Vendors
©2014TheAdvisoryBoardCompany•28068C
EDP1—Allows maximum customization
AaaS2—Delivers broad-functioning standardized and
integrated platform with few customization paths
Point Solutions—Provides domain expertise within packaged
solutions offering a narrow focus on a defined specialty
BI Market Evolution: Convergence
Similar to EMR Evolution: Combine the Strengths of Each Approach
Source: Health Care IT Suite research and analysis.
1) Enterprise development platform.
2) Analytics as a service.
EMR Module—Offers closed-loop functionality that is tightly
integrated with the transaction system
Analytics platforms
integrating data from
all points on care
continuum, working
in real time to inform
decision-making
processes,
hypothesis formation,
and exploration
NOW LATER
34
©2014TheAdvisoryBoardCompany•28068C
Know Your Destination, Then Choose Your Path
35
Partners and Tools to Meet Your Business and Clinical Goals
Source: Health Care IT Suite research and analysis.1) Analytics as a service.
AaaS • Enterprise A chooses to use
existing but separate EMR and
revenue cycle modules and
create its own data marts to
combine data when necessary
while it plans a full conversion to
a unified platform
• Enterprise B purchases a cloud-
based AaaS1 solution to satisfy
speed to value and current skill
set gaps
• Enterprise C chooses a series of
late-binding data stores to
provide maximum flexibility for its
still-emerging business planning
process
EMR
Marts
Inmon
EDW Virtual
©2014TheAdvisoryBoardCompany•28068C
Long-Term Trend Control Requires Short-Term Investments
Source: Health Care Advisory Board interviews and analysis.
Low Total Cost A Difficult Balance to Strike
The Bottom Line
“If you can’t deliver
lower cost, you’re out
of the running.”
Patrick Carter, MD
Medical Director for
Care Coordination and
Quality Improvement,
Kelsey-Seybold Clinic
Short-Term Investments
• IT infrastructure
• Care management staff
• Care coordination
programs
• New access points
Long-Term Payoff
• Cost trend control
• Improved health
outcomes
• Improved patient
satisfaction
Higher Immediate
Unit Prices
Lower Future
Total Cost
The Tension Between Unit Price and Total Cost
36
©2014TheAdvisoryBoardCompany•28068C
On a scale of 1-5, how do you think your organization is managing the
short-term IT-related investment vs total future cost benefit balance? –
262 respondents
A. Very little short-term investment – 6%
B. Some short-term investment – 28%
C. Moderate short-term investment – 36%
D. Good short-term investment – 20%
E. Very strong short-term investment – 10%
Poll #5 IT Investment
©2014TheAdvisoryBoardCompany•28068C
Retail, Population Health Strategies Converge
Source: Health Care Advisory Board interviews and analysis.
The Missing Link for Population Health?
Winning at Point of Network Selection
Successful Population
Health Management
Lower
Total Cost
Lower
Premium
Network
Selection
Engagement
Experience
38
©2014TheAdvisoryBoardCompany•28068C
Key Take-Aways
39
BI is Essential to Population Health Management and Retail Revolution
1. Population Health Management will require new applications of analytics in support of risk
assessment and management, population health monitoring and patient engagement.
2. In addition to PHM-focused needs, the retail revolution will require BI-related capabilities to
address additional requirements such as for low unit prices, adequate geographic reach and
clinical scope, and service quality
3. Use the BI Maturity Model to ensure the value of your current BI investments while
developing the capabilities for the Advanced Analytics and Big Data phases.
4. Although important, BI is not just about having the right tools. Address your biggest
challenges in dimensions (rows) of the BI maturity model, such as those related to data
governance, cultural transformation, and BI-related skills.
5. Identify the BI “core strategy” or architectural approach that best addresses your
organization’s capacity, capability and goals while appropriately utilizing other core strategic
approaches.
6. Plan for the future by developing plans that consider patient-reported data, events-driven
architecture, social media, streaming data and machine learning.
7. Balance principles with pragmatism. Health care BI is an immature and rapidly evolving area
so progress may be made by taking “two steps forward and then one step back.”
.

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Preparing for the Coming Change: An Overview of the Healthcare Analytics Market

  • 1. Overview of the Health Care Analytics Market BI Needs Outpace Vendor Tools and Health-Care Organizations’ Capabilities Health Care IT Advisor
  • 2. ©2014TheAdvisoryBoardCompany•28068C Poll #1 - Primary Role 2 What is your primary role? – 262 respondents A. Finance – 10% B. Clinical/Quality – 25% C. IT – 25% D. Executive – 25% E. Operational – 14%
  • 3. ©2014TheAdvisoryBoardCompany•28068C 2 3 1 Road Map 3 The Ever-Changing BI Marketplace BI Requirements and Challenges Beyond Population Health Management – The Coming Retail Revolution
  • 4. ©2014TheAdvisoryBoardCompany•28068C Staying Afloat Through Cross-Subsidization Source: American Hospital Association, “Trendwatch Chartbook 2014,” available at: www.aha.org; Health Care Advisory Board interviews and analysis. Our Existing Business Model Hospital Payment-to-Cost Ratio, Private Payer, 2012 149% Hospital Payment-to-Cost Ratio, Medicare, 2012 86% • Above-cost pricing • Robust fee-for-service volume growth • Steady price growth • Only one component of our total business Commercial Insurance Public Payers Below CostAbove Cost Traditional Hospital Cross-Subsidy 4
  • 5. ©2014TheAdvisoryBoardCompany•28068C Roles of Payers, Providers, Patients Traditionally Stable Source: Health Care Advisory Board interviews and analysis. A Strategy Dependent on Well-Worn Channels Established Provider • Expect steady public- payer, commercial price growth • In-network for most plans Entrenched Payer • Maintain broad provider networks • Pass excess cost growth on to employers through brokers Price-Insulated Patient • Open access to broad provider network • Seek care with little concern for out-of- pocket payment Assumptions Underlying Provider Growth Strategy 5
  • 6. ©2014TheAdvisoryBoardCompany•28068C Nearing the Limits of Extractive Growth Strategies 6 Legacy Growth Levers Increasingly Time-Limited Source: Health Care Advisory Board interviews and analysis. Traditional Hospital Growth Strategies Scale and Pricing Power Demand Price Increases Emerging Limitations: • Shrinking population of commercially insured patients • Rise of stealth and contingent rate cuts • Activist purchasers refusing price increases Consolidate Market Position Emerging Limitations: • High degree of existing consolidation in major markets • Heightened scrutiny of hospital mergers • Limited capital available for acquisitions Lock Up Referral Streams Emerging Limitations: • Fewer physicians remain unaffiliated • Increased scrutiny of practice acquisitions • Elevated competition from other health systems, physician aggregators
  • 7. ©2014TheAdvisoryBoardCompany•28068C Three Trends Threatening the Traditional Provider Business Model Source: Health Care Advisory Board interviews and analysis. 1) 1. Health Insurance Exchanges Impending Collapse of the Cross Subsidy Medicare Payment Innovation • A growing wave of Medicare beneficiaries • Reductions in FFS payments • New mandatory and optional risk-based payment models • Growth of Medicare Advantage Market-Based Medicaid Reform • Growth of Medicaid Managed Care • Commercialization through “Private Option” Increased Commercial Market Competition • Many private employers shifting to private exchanges or converting to self-funding • New dynamic individual market on both public and private HIXs1 • New channels for competition in group market 1 2 3 7
  • 8. ©2014TheAdvisoryBoardCompany•28068C Which of these three trends worries you the most? – 236 respondents A. Medicare payment innovation – 38% B. Market based Medicaid reform – 19% C. Increased commercial market competition – 43% Poll # 2 - Trends 8
  • 9. ©2014TheAdvisoryBoardCompany•28068C Disrupting Traditional Channels of Coverage Source: Congressional Budget Office, “May 2013 Estimate of the Effects of the Affordable Care Act on Health Insurance Coverage,” available at: www.cbo.gov; Accenture, “Are You Ready? Health Insurance Exchanges Are Looming, “ 2013, available at: www.accenture.com; Kaiser Family Foundation, “The Coverage Gap: Uninsured Poor Adults in States that Do Not Expand Medicaid,” April 2, 2014, available at: www.kff.org; Health Care Advisory Board interviews and analysis. 1) Based on number of lives falling into the “Medicaid expansion gap” in non-expansion states. 2) Based on the number of Medicare Advantage enrollees. A Burgeoning Retail Market 25M 87M 5M 40M 17M Public Exchange "Private Option" Medicaid Expansion Private Exchange Medicare Exchange Total Retail Market Projected Size of the Potential Retail Market 2018 1 2 9
  • 10. ©2014TheAdvisoryBoardCompany•28068C Designing Around Purchaser Preferences Source: Health Care Advisory Board interviews and analysis. From Individual Inputs to Consumer Products Office Visits Imaging Lab Emergency Care Inpatient Procedures Outpatient Procedures Wellness Programs Long-Term Care Pharmacy Product Packaging Shoppable Procedures Diagnostics, surgery, follow-up care, planned treatments Emergent Care Low-to-mid acuity urgent care, emergency care Enhanced Management Care/disease management, wellness, ongoing primary care Current Health Care Production Model
  • 11. ©2014TheAdvisoryBoardCompany•28068C Multiple Opportunities To Appeal to Decision-Makers Source: Health Care Advisory Board interviews and analysis. Winning Share at Two Points of Sale Network Selection Care DecisionNetwork Assembly Decision Processes Involved in Provider Choice Being chosen by payers, employers, exchange operators, custom network builders, and accountable physician entities to be offered as a network option Being chosen by patients at the point of care Being chosen by individuals during enrollment Secure Enrolled Lives Win Share of Volumes 1 2 11
  • 12. ©2014TheAdvisoryBoardCompany•28068C Source: Health Care Advisory Board interviews and analysis. Capturing New Channels of Growth Established Provider Care Delivery Network Relationship-Based Referring Physician Cost-Conscious Referring Physician Price-Sensitive Consumer Entrenched Payer Vulnerable Payer Activated Employer Exchange Operator Custom Network Builder Secure Enrolled Lives Win Share of Volumes Traditional Growth Channels New Growth Channels Key Decision-Makers in Traditional and New Growth Channels Individual Insurance Shopper Accountable Physician Entity 12
  • 13. ©2014TheAdvisoryBoardCompany•28068C Catalyzing a Shift in Network Demands Source: Health Care Advisory Board interviews and analysis. No Longer Insulated From Market Forces Traditional Market Retail Market Growing number of buyers 1 Proliferation of product options 2 Increased transparency 3 Reduced switching costs 4 Greater consumer cost exposure 5 Passive employer, price-insulated employee Activist employer, price-sensitive individual Broad, open networks Narrow, custom networks No platform for apples-to- apples plan comparison Clear plan comparison on exchange platforms Disruptive for employers to change benefit options Easy for individuals to switch plans annually Constant employee premium contribution, low deductibles Variable individual premium contribution, high deductibles Characteristics of a Traditional vs. Retail Market 13
  • 14. ©2014TheAdvisoryBoardCompany•28068C 2 3 1 Road Map 14 The Ever-Changing BI Marketplace BI Requirements and Challenges Beyond Population Health Management – The Coming Retail Revolution
  • 15. ©2014TheAdvisoryBoardCompany•28068C Expand Your BI Focus for PHM3 and Retail Revolution 15 Operational Improvement Is Not Sufficient for Transformation Source: Health Care IT Suite research and survey analysis. 1) Health Care IT Suite BI Survey, April 2012. 2) Marsha Gold, Helms, David, Guterman, Stuart, Identifying, Monitoring, and Assessing Promising Innovations: Using Evaluation to Support Rapid-Cycle Change, The Commonwealth Fund, June 2011. 3) Population health management. 4) Clinical decision support. Successful Reinvention The right time to rethink the business model and supporting culture—for the two must go together—is before you get into trouble, not during, or after, when resources are scarce and fear is contagious. 26% 24% 20% 16% 14% CDS4/Evidence- Based Pathways Quality Reporting Operational Efficiencies Cost Management Revenue/ Contract Reporting Currently, providers do not have sufficient data about the clinical or financial experience of their patients; these data are important to manage patient care and financial risk effectively as well as to support rapid-cycle performance evaluation and targeted improvement efforts. ” Commonwealth Fund Study,2 July 2011 Foci of Current BI Efforts1 Still Relevant Bill Fischer Forbes Blog, April 2013 ”
  • 16. ©2014TheAdvisoryBoardCompany•28068C Examples of Key BI-Related Capabilities for the Four Retail Imperatives Source: Advisory Board Company research and analysis BI Technologies Key to Redefining “Value” Essential Nice to Have Future Need Geographic Reach and Clinical Scope • Service line planning • Facility planning • Referrals analysis • Network modeling (for narrow networks) • Facility optimization • Population-based planning Clinical and Service Quality • Quality scorecards • Patient satisfaction and loyalty monitoring • Site-specific CDS • CDS on integrated data • Access / scheduling optimization • Predictive modeling for consumer behavior • Persuasion modeling for consumer behavior • Personalized care • Cognitive support • Social media analytics Low Unit Price • Pricing monitoring and benchmarks • Supply chain monitoring • Resource monitoring • Cost accounting • Supply chain optimization • Resource optimization • Real-time costing data • Dynamic pricing tools Total Cost Control • Contract modeling • Risk stratification • Physician performance • Service line performance • Registries • Cost accounting • PHM scorecards • Real-time risk identification • Real-time referral analytics • Patient-reported data • Patient-reported outcomes Desirable Network Attributes LowCost 16
  • 17. ©2014TheAdvisoryBoardCompany•28068C • Contracting (pre/post) • Performance scorecards Administer, Monitor, and Report 6 Analytics Enabling Population Health Management 17 Examples of Tools and Processes with Analytic Underpinning Source: The Advisory Board Company research and analysis.1) PHM = population health management. • PCP attribution • Risk segmentation – Frequent utilization – Chronic conditions • Disease or PHM1 dashboards • Registries • Smart portals Map and Track 2 • Registries • Assisted interventions – Clinical decision support – Cognitive support Deliver Care 3 Identify Population 1 • Real-time monitoring/alerts • Registries • Risk reassessment • Pathway optimization Coordinate Cross- Continuum Care 4 • Predictive/persuasive engagement • Patient satisfaction Engage Patients 5
  • 18. ©2014TheAdvisoryBoardCompany•28068C Assuring Employers of Ability to Manage Future Costs Source: Health Care Advisory Board interviews and analysis. Making the Case for Care Management Capabilities “In our market, there is plenty of talk about ‘accountable care’, but we are differentiating with the organizational commitment and the infrastructure investment to sustain a new economic model.” Chief Marketing Officer Large Health System in the West Investment in Data Analytics Shows capability to assess patient risk and pinpoint interventions Clinical and Claims Data Integration Illustrates advantage over traditional health plan Demand for Out-of- Network Claims Data Shows commitment to continuously manage care for attributed population Telehealth Platforms and Programs Demonstrates ability to keep low-acuity cases in most appropriate care site Four Ways to Demonstrate Care Management Capabilities 18
  • 19. ©2014TheAdvisoryBoardCompany•28068C Collecting Data for Analysis, Sharing Data for Care 19 Building a Network of Owned and Affiliated Entities Source: Health Care IT Suite research and analysis. 1) Health Level 7. 2) Clinical Document Architecture/Continuity of Care Document. Physician Offices Hospitals LTC Facilities Patient HomePayer BI Varied Mechanisms of Exchange Public and Private HIEs, HL71 Messages, CDA/CCD,2 Custom Development Patient Retail Clinics and Non-Traditional Providers State Lab
  • 20. ©2014TheAdvisoryBoardCompany•28068C It Only Gets More Complex Expanding the Data Collection Net Internal Structured Data External Structured Data Internal Unstructured Data External Unstructured Data Transaction Data Excel/Access Medical Device Sensors CAD/CAM Diagnostic Images Claims Pt Satisfaction Survey Data CDA Documents Public Data Benchmarks Progress Notes Procedure Notes Discharge Summaries Word Documents Scanned Consents Email Contracts Social Networks Email Online Reviews 20
  • 21. ©2014TheAdvisoryBoardCompany•28068C Developed by Jim Adams, Meg Aranow, Ernie Hood, and Dale Sanders 1) Red cells indicate the primary distinguishing characteristic of each maturity phase. 2) EHR = electronic health record; ETL = extraction transformation loading; KPI = key performance indicator; MDM = master data management; NLP = natural language processing; ODS = operational data store; SQL = structured query language. The BI Maturity Model; 2014 Edition Fragmented Enterprise Perspective Advanced Analytics Big Data BI architecture None or several point solutions Central infrastructure basics implemented BI core and self- service infrastructure in place Optimized infrastructure which may include data marts, ODSs, and a mobility platform Data sources / data currency Transaction application from one system or BI tool specific from limited number of internal source systems ETL established to combine data from primary sources such as EHR and revenue cycle ETL established for secondary data sources and varied currency including more frequently than daily External sources including web, patient-generated, and genomics collected as real time and streaming data Types of analysis / use of analytics Automated internal reporting Enterprise KPIs, automated external reporting, segmentation (e.g. risk stratification) Predictive, prescriptive analytics, data exploration, and hypothesis generation Analytics combining multiple and complex data sources, cognitive analytics, analytics for personalized medicine Data models No or limited single-purpose transformation Consolidated approach of basic models including dimensional, late binding, and in-memory models Multiple, optimized data models No schema Data governance None or limited departmental decisions about use and usability Common policies and standards, centrally-managed priorities, shared documentation, focus on data quality and consistency Data normalization, source system changes, and maintenance established Active stewards of internal and external data, complex analysis review, data management practices are pervasive Tools Independent choices for limited purposes; redundant products Centralized tool acquisition process for basic data acquisition, management, and visualization Advanced analytic tools including self-service Specialized, targeted capabilities including Hadoop and tools for unstructured data Skills SQL, Excel, basic data modeling, basic visualization In-depth knowledge of physical and logical data modeling, basic statistics, and MDM use In-depth knowledge of statistics and operations analysis, procedural programming Apply NLP, genomics, and rules engine programming; ability to combine disparate data types Culture / enterprise data literacy Value of data under-appreciated; decisions based on no or limited data Champions emerging and growing emphasis on data governance and fact-based decisions Training on data literacy, identifying BI opportunities, data exploration, and data-driven changes Engrained understanding of BI capabilities and limitations BI governance / organizational structure Local control Central agenda and funding; core BI and leadership teams established Resources harmonized between central core and stakeholder departments; strong governance processes in place Includes relevant, external resources; significant presence of distributed analytics (SSBI) 21
  • 22. ©2014TheAdvisoryBoardCompany•28068C Top 3 Challenges 22 Data Governance, Culture, Organization Source: Health Care IT Suite research and analysis.1) N=41. Findings and Observations • Institutions with less BI maturity are more likely to have data governance as the #1 challenge • There is a inverse correlation between transformation challenges and the presence of a BI strategic plan ! Cultural Transformation 44% Data Governance 51% BI (Resource) Organization 46%
  • 23. ©2014TheAdvisoryBoardCompany•28068C 2 3 1 Road Map 23 The Ever-Changing BI Marketplace BI Requirements and Challenges Beyond Population Health Management – The Coming Retail Revolution
  • 24. ©2014TheAdvisoryBoardCompany•28068C Poll #3 BI Vendors 24 How many BI vendors does your (or a typical) health system have? – 191 respondents A. 1 – 9% B. 2-5 – 54% C. 6-10 – 22% D. More than 10 – 16%
  • 25. ©2014TheAdvisoryBoardCompany•28068C Fragmented BI Software Market 25 Our Survey Confirms That No One Is Using a Single Solution Source: Health Care IT Suite research and analysis. # of vendors # of participants =< 2 12 (43%) 3-4 7 (25%) >= 5 9 (32%) • Allscripts Analytics Module • Aster • Crimson • Dimensional Insight Pro Diver • Embarcadero • Epic Cogito • Epic Clarity • EPSi • Explorys • HCD • HealthCatalyst • IBM - Cognos • IBM - DB2 • IBM for centralized data warehouse • IBM InfoSphere • IBM NLP • IBM p770 • Informatica Powercenter • Information Builders • InfoSol Infoburst • Inhouse-designed SQL repository • MCCM • MedInsight • Medisolv • Meditech Data Repository • Medventive • MicroStrategy • MSBI • Oracle - DBMS • Oracle - HDWF and Omics Data Bank • Oracle - OBIEE • Phytel - Verisk • PremierConnect Enterprise • QlikView/Visual Analytics/Exploration • SAP Business Objects Enterprise • SAP Business Objects Excelsius • SAP Business Objects Suite (Crystal, InfoView, Web-i, Explorer) • SAP Data Services ETL • SAP Information Steward (Profiling/Quality) • SAS/SAS (Advanced Analytics) • Siemens DSS • Tableau
  • 26. ©2014TheAdvisoryBoardCompany•28068C Survey Results for Architecture and Tools 26 Architecture and Partners 25 9 16 18 18 9 9 8 4 70 64 52 41 32 39 26 23 12 15 5 4 9 9 9 9 15 12 5 23 28 32 41 44 57 62 68 77 Prescriptive Modeling Advanced Analytics/Statistical Visualization Predictive Modeling Natural Language Processing Master Data Management Vocabulary and Semantic Management Person Matching/Merge Visualization Tools Access Control and Auditing Extract, Transform, and Load No Plan to Purchase Included in Purchasing Plan Currently in Test Environment Implemented Percentage of BI Tool Inventory and Purchasing Plan Source: Health Care IT Suite research and analysis.
  • 27. ©2014TheAdvisoryBoardCompany•28068C Different Roads to Take on Your BI Journey 27 You’ll Live in the Overlaps Source: Health Care IT Suite research and analysis. Build OutsourceBuy Solution Considerations • Multiple point solutions • Assess whether self-development outpaces a rapidly growing vendor market • Cloud computing: cost vs. security • Right-size solution set for your organization’s needs and capabilities Resource Considerations • IT skill set requirements • Business / clinical expertise • Speed to delivery • Need to customize • Partnership culture
  • 28. ©2014TheAdvisoryBoardCompany•28068C Use Deliberate Criteria to Choose Your BI Approach 28 Match the Approach to Your Organization's Strengths and Goals Source: Health Care IT Suite research and analysis. Broad-based functional capability to use as a basis for self development to support a belief that analytics is a differentiator Enterprise Development Platform1 Stand-alone components with narrow but deep subject matter expertise Point Solutions3 Application (often bundled with infrastructure) including process and analytic components, for aggregation and comparison Analytics-as-a-Service2 Analytic and process routines tightly integrated with the transaction systems EMR Subsystem4
  • 29. ©2014TheAdvisoryBoardCompany•28068C Poll #4 Approaches 29 Which of these 4 approaches best matches your organizational strengths and goals? – 234 respondents A. Enterprise development platform – 29% B. Analytics-as-a-service – 20% C. Point solutions – 11% D. EMR subsystem – 10% E. Unsure or not applicable – 30%
  • 30. ©2014TheAdvisoryBoardCompany•28068C Core Strategy: Enterprise Development Platform 30 Source: Health Care IT Suite research and analysis. Consideration Potential Pros Potential Cons Enterprise Strategy Belief that analytics can be a clear differentiator Flexibility supports still- evolving strategies Requires considerable attention and focus from the entire organization Expertise Provides a platform for industry leadership Requires business/clinical, analytic and IT expertise with a desire to innovate Cost Greatest startup costs Governance Required participation may help drive cultural change Provides no framework for governance Time to Value Possibility to iterate quickly for additional functionality Slow initial time-to-value Transition Effort Full control of historical export and transition routines May be difficult to transition to less customized solutions Agility Highest degree of analytic flexibility and adaptability; good for heterogeneous system environment IBM Oracle Recombinant (by Deloitte) Healthcare Data Works Health Catalyst Caradigm Sample Vendors
  • 31. ©2014TheAdvisoryBoardCompany•28068C Core Strategy: Analytics as a Service 31 Source: Health Care IT Suite research and analysis. Consideration Potential Pros Potential Cons Enterprise Strategy Inter-organizational benchmarking and comparative analytics Currently limited abilities for single analytic perspective on patient care and costs Expertise Outsource the details of analytics and data management Offers comparative analysis Outsourcing limits ability to tailor fit to organizational needs Cost Less startup expense than platforms Costs may increase quickly Governance Requires strong centralized data governance to support accurate aggregate analysis Time to Value Time to value is addressed by basic starter kits Starter kits may be incomplete Transition Effort Contract should ensure efficient data packaging and transfer In-house skill set gaps Agility Best for reasonably homogenous system environments Limited analytic flexibility and adaptability for more complex use cases Sample Vendors  Explorys  Humedica  Lumeris  Premier Alliance  Truven Health Analytics
  • 32. ©2014TheAdvisoryBoardCompany•28068C Core Strategy: Point Solutions 32 Source: Health Care IT Suite research and analysis. Consideration Potential Pros Potential Cons Enterprise Strategy May be used as an interim solution against a larger integrated plan Does not provide a single analytic perspective Expertise Provides expertise and specific analytics in vertical business and clinical areas Analytics may not be generalizable Cost Buy just what is essential Multiple solutions may be costly and more complicated to maintain Governance Narrow focus Challenges governance models to create unified data picture and use Time to Value Reduced time to value Transition Effort Smaller footprint allows easier migration New solution may be challenged to go as deep Agility Can surround with other products and services Limited ability to customize Sample Vendors  AltaSoft  Allscripts  MedeAnalytics  Medventive  Midas+  Omincell  The Advisory Board (Crimson)  Cloudera  Qlikview
  • 33. ©2014TheAdvisoryBoardCompany•28068C Core Strategy: EMR Module 33 Source: Health Care IT Suite research and analysis. Consideration Potential Pros Potential Cons Enterprise Strategy Strong support for operational analytics May not be able to meet all analytic needs Expertise Operational improvements should benefit from knowledge of transaction systems Current offers lack advanced analytic capabilities Cost Governance Requires tight integration with operational governance Time to Value Basic functionality should be quick to implement Solution sets are still limited Transition Effort May be difficult to transition away because of the power of embedded workflow support Agility Vendor-supplied enhancements may outpace internal development capabilities Ability to incorporate and allow actions to be taken on external data is unproven • Epic • Cerner • MEDITECH • Siemens • Allscripts Sample Vendors
  • 34. ©2014TheAdvisoryBoardCompany•28068C EDP1—Allows maximum customization AaaS2—Delivers broad-functioning standardized and integrated platform with few customization paths Point Solutions—Provides domain expertise within packaged solutions offering a narrow focus on a defined specialty BI Market Evolution: Convergence Similar to EMR Evolution: Combine the Strengths of Each Approach Source: Health Care IT Suite research and analysis. 1) Enterprise development platform. 2) Analytics as a service. EMR Module—Offers closed-loop functionality that is tightly integrated with the transaction system Analytics platforms integrating data from all points on care continuum, working in real time to inform decision-making processes, hypothesis formation, and exploration NOW LATER 34
  • 35. ©2014TheAdvisoryBoardCompany•28068C Know Your Destination, Then Choose Your Path 35 Partners and Tools to Meet Your Business and Clinical Goals Source: Health Care IT Suite research and analysis.1) Analytics as a service. AaaS • Enterprise A chooses to use existing but separate EMR and revenue cycle modules and create its own data marts to combine data when necessary while it plans a full conversion to a unified platform • Enterprise B purchases a cloud- based AaaS1 solution to satisfy speed to value and current skill set gaps • Enterprise C chooses a series of late-binding data stores to provide maximum flexibility for its still-emerging business planning process EMR Marts Inmon EDW Virtual
  • 36. ©2014TheAdvisoryBoardCompany•28068C Long-Term Trend Control Requires Short-Term Investments Source: Health Care Advisory Board interviews and analysis. Low Total Cost A Difficult Balance to Strike The Bottom Line “If you can’t deliver lower cost, you’re out of the running.” Patrick Carter, MD Medical Director for Care Coordination and Quality Improvement, Kelsey-Seybold Clinic Short-Term Investments • IT infrastructure • Care management staff • Care coordination programs • New access points Long-Term Payoff • Cost trend control • Improved health outcomes • Improved patient satisfaction Higher Immediate Unit Prices Lower Future Total Cost The Tension Between Unit Price and Total Cost 36
  • 37. ©2014TheAdvisoryBoardCompany•28068C On a scale of 1-5, how do you think your organization is managing the short-term IT-related investment vs total future cost benefit balance? – 262 respondents A. Very little short-term investment – 6% B. Some short-term investment – 28% C. Moderate short-term investment – 36% D. Good short-term investment – 20% E. Very strong short-term investment – 10% Poll #5 IT Investment
  • 38. ©2014TheAdvisoryBoardCompany•28068C Retail, Population Health Strategies Converge Source: Health Care Advisory Board interviews and analysis. The Missing Link for Population Health? Winning at Point of Network Selection Successful Population Health Management Lower Total Cost Lower Premium Network Selection Engagement Experience 38
  • 39. ©2014TheAdvisoryBoardCompany•28068C Key Take-Aways 39 BI is Essential to Population Health Management and Retail Revolution 1. Population Health Management will require new applications of analytics in support of risk assessment and management, population health monitoring and patient engagement. 2. In addition to PHM-focused needs, the retail revolution will require BI-related capabilities to address additional requirements such as for low unit prices, adequate geographic reach and clinical scope, and service quality 3. Use the BI Maturity Model to ensure the value of your current BI investments while developing the capabilities for the Advanced Analytics and Big Data phases. 4. Although important, BI is not just about having the right tools. Address your biggest challenges in dimensions (rows) of the BI maturity model, such as those related to data governance, cultural transformation, and BI-related skills. 5. Identify the BI “core strategy” or architectural approach that best addresses your organization’s capacity, capability and goals while appropriately utilizing other core strategic approaches. 6. Plan for the future by developing plans that consider patient-reported data, events-driven architecture, social media, streaming data and machine learning. 7. Balance principles with pragmatism. Health care BI is an immature and rapidly evolving area so progress may be made by taking “two steps forward and then one step back.” .