Data is driving fee-for-value healthcare. Every firm is racing to figure out how to bring the power of data science to streamline healthcare encounters ~ member/consumer engagement, provider/PCP engagement or clinical/care engagement.
Health expenditures in the United States crossed $3.2 trillion in 2015 which is more than ten times the $256 billion spent in 1980.
Almost 15% of U.S GDP is spent on healthcare…a staggering number. As a mega-vertical, healthcare covers several major segments (the 7 Ps)
- Payers (Health Insurance and Health Plans),
- Providers (Hospital Systems, Labs and IDNs),
- Pharmacy (retail distribution networks), and
- Pharmaceutical and medical equipment manufacturers,
- Prescribers (Physicians, clinics and pharmacy minute clinics)
- Police (Regulators, FDA)
- Patients (consumers)
U.S. healthcare system is a complex beast and difficult to navigate – providers need to make it easier for patients. They are using people resources like care coordinators and patient navigators to help patients navigate the system.
The focus on the payer side is in digitizing health today is to reduce the amount of waste in the health care system via implementation of new forms of health IT and Analytics… that reduces inefficiencies, redundancies and administrative costs.
According the CEO of Aetna…”the health care system wastes more than $765 billion each year – that’s 30 percent of our health care spending.”
While spending on health care is dominating headlines, the health care industry (7Ps) is in a state of flux. Stakeholders across the health care sector are running hard to reduce costs. The drivers impacting cost of healthcare include:
- Aging population – Patient history and patterns of care impacting patient readmission rates
- Rise in Chronic Disease – 75% of cost – Prevention not reactive medicine
- Drug cost – escalating for certain therapies (Generics exchanged for biological drugs)
The healthcare ecosystem is being reshaped by two powerful counter economic forces at work: (1) Improve quality of care and (2) drive the cost of care down. Basically spend less and get more.
As a result, the entire healthcare ecosystem is changing into a “information-driven”, “evidence-based” and “outcome-driven” model.
The target healthcare transformation goals are:
- align economic incentives between payers and providers,
- digital engagement…create a simpler, more transparent consumer experience, and
- connected health….technologies that seamlessly connect our healthcare system.
In this posting we look at Digital Health Care use cases and how data and analytics are being slowly but sure being adopted in the form of informatics. All this change is being driven under the guise of Health Reform.