Hospitals with value-based contracts making more post-EHR investments
The hospitals most likely to invest in leading-edge technologies such as data integration, aggregation, reporting and analytics tools are those health systems already familiar with the demands of participating in value-based contracts, a new report from Deloitte shows.
But even more advanced investors, those with a clear eye toward what the future of reimbursement will require, have been slower to build out capabilities related to patient and provider engagement and other technologies related to core operational goals than might be expected, researchers said.
WHY IT MATTERS
For its study, "Beyond the EHR," Deloitte looked at the buying decisions of some 4,500 hospitals for the five years between 2012 and 2016.
As might be expected, those providers whose bottom lines depended on quality and value incentives were more likely to invest in software to help with data management, analytics, reporting, population health management, care coordination and more.
But while health systems with "more payments based on quality and value were more likely to adopt" those technologies, the report also detected another trend: For all hospitals, whether they're deep into accountable care or not, investments aren't where they should be for other tech capabilities that will be required for value-based success.
"Few hospitals have been investing in patient and provider engagement technologies or core applications that support operational and financial aspects of their business, such as supply chain management and revenue cycle management," researchers wrote. "For these kinds of technologies, we did not see differences in adoption based on the share of payments based on quality and value."
THE LARGER TREND
As most U.S. health systems have by now realized, big changes are happening with regard to how care is delivered and paid for. Many are already "facing a margin cliff as the aging of the US population combined with lower reimbursement from government payers put pressure on traditional revenue sources," according to Deloitte.
Electronic health records are critical but basic tools for survival in this new era. More than ever, providers need lots of granular data about their patients and populations, but they also need new and fast-evolving tools to help make sense of it all: "new ways of collecting, processing, and analyzing data, coordinating care in and out of the hospital setting, and supporting clinicians throughout the care journey can be therefore critical."
But another imperative, one that fewer hospitals have yet begun to appreciate, is the rise of consumerism, said Deloitte. For example, researchers pointed to the fact that more than half of Kaiser Permanente's 12.2 million patients are registered to see online lab results, fill prescriptions and email their doctors.
And more and more of them are taking advantage of that convenience: "Virtual interactions with patients rose from 56 percent of total interactions in 2015 to 59 percent in 2017," according to the report.
Still, too many health systems are dragging their feet when it comes to preparing for this new paradigm – whether that means investing in basic data aggregation and pop health analytics, or more advanced consumer engagement and revenue cycle tools.
Partly, that may be because many have still yet to feel the full gravity of the value-based sea change. As Leigh Williams, administrator of business systems at University of Virginia Health System, explained this past year, for some decision-makers, the slow shift toward value-based care is a bit like fishing in a boat far from shore.
When a storm is on the horizon and the barometric pressure starts dropping, that's when the "fish start biting like mad," Williams explained. In that way, at least, it's the "best time to be out there." The challenge, of course, is that "you need to get back to shore, but you really don't want to because you're out there to catch fish."
With healthcare on the cusp of fee-for-service and value-based care, she explained, providers are still making money with volumes of patients – but there's a storm looming called pay-for-performance, and weathering it will require the help of an array of new technologies.
Still, as Williams said, it might be hard for some C-suite to make preparations for it, especially for envelope-pushing projects whose eventual ROI may seem distant or only theoretical.
The Deloitte report uses another maritime metaphor to make a similar point: "Many health systems seem to be waiting for the tide to shift to value-based care before adopting technology that will support new payment models. But waiting to invest could put health care organizations at risk of falling behind."
ON THE RECORD
"As hospital revenue tips more toward payments based on outcomes and risk and more consumers show an interest in taking their care into their own hands, health care systems – even those mainly working in traditional payment environments – should go beyond the electronic health record to meet the demands of the new market," wrote Deloitte's Steve Burrill and Claire Boozer Cruse.
U.S. health systems "should consider investing more in technology that supports patient and provider engagement and core applications," they added, and "may also need to make significant upgrades to core systems to adopt the capabilities required to manage downside risk under these new contracts. More recent evidence suggests that some leading health systems are investing in these areas as they gain more experience with new payment models."
The Deloitte report also pointed toward further investments that forward-thinking hospitals should be thinking hard about to succeed with value-based reimbursement: "New and emerging technologies, such as the Internet of Things and blockchain, will likely play an increasing role in supporting the capabilities needed under new payment models."
Healthcare IT News is a publication of HIMSS Media.