In 2020, payers and providers alike are striving to improve care and quality, while managing risk and controlling costs to embrace value-based reimbursement and capitalize on new opportunities catalyzed by an aging population and driven by choice as with Medicare Advantage plans. Over the past decade, payers and providers were told that these improvements could be realized by embracing healthcare information technology advancements. Yet, at the dawn of this decade, America’s healthcare system is in crisis. These promises made to payers by Healthcare IT providers have not been delivered. Payers still face rising costs, complex disease management compounded by a rapidly aging population, social determinants of health impact on quality disparities nationwide.
The promises of healthcare IT have not been realized because siloed data and technology have created a functional disconnect between payers, providers, and their various departments. This prevents them from communicating and collaborating effectively to deliver the best care for their members.
Advancements like digitized records and secure patient data systems were meant to lead to better outcomes for plans, providers, and members alike, but the statistics paint a different picture:
- As of 2018, Healthcare spending totaled over $3.5 trillion, or 17.7 percent of US GDP (1)
- This total is expected to rise 5.5 percent per year, reaching $6 trillion by 2027 (1)
- From 2000-2017, 33% of access measures did not show improvement, and 14% showed worsening (2)
- Americans have 3 years lower average life expectancy than other high-income countries (3)
This is our first post in an investigative research series aimed at helping you tackle the challenges — and realize the promises — of healthcare IT in 2020 and beyond.
Why Hasn’t Healthcare IT Kept its Promise?
US healthcare organizations spent an estimated $7.1 billion on IT in 2017, more than two and a half times what they spent in 2012 (4). But quality hasn’t kept pace.
There are three key reasons healthcare IT has not yet succeeded in reining in costs or improving outcomes:
Lack of alignment between payers, providers, and members
While they are all intertwined, an egocentric mindset plagues payers, providers, employers, and governmental branches alike, weighing down an already bloated system. Each stakeholder seeks to achieve specific goals in the zero-sum pursuit of individual returns. This egocentricity directly contributes to the lack of alignment between stakeholders’ systems and data, and continues to drive costs up at an unsustainable rate.
Functional silos and technical barriers
Segmented data silos cause inconsistent results and data-related obstacles to the transition to value-based care, including: the lack of access to administrative claims data from payers; data that are not actionable even if they are available; and complying with requirements to submit and receive data in different formats from different payers.
Inefficient processes and lack of collaboration
In some ways, measuring and reporting quality has become a barrier to improving it. The biggest category of wasteful spending is administrative complexity, which accounts for 25% of US healthcare spending (5). As a result of data silos, a tremendous amount of staff time and resources are wasted while attempting to communicate with and coordinate care between providers and members.
Members and quality measures both suffer when a health plan is unable to communicate with a provider in a timely manner. Many payers have exhausted low-hanging, quality measure improvement opportunities, thus they struggle to eke out improvements on more complex metrics like hybrid quality measures.
Does Our Healthcare Crisis Have a Cure?
To revitalize the American healthcare system, stakeholder behaviors and the technology they use must change. To lower costs while improving quality, payers and providers must have a complete picture of every member’s care. Likewise, members must have access to their medical history and be empowered to manage their own well-being.
The solution to escalating costs and lagging quality improvement is to:
- Align all players through unified and efficient data systems,
- Prioritize data integration to effectively improve quality without wasting institutional resources,
- And enable payers to leverage enterprise data for competitive advantage (6).
By breaking down technological and operational barriers between stakeholders in the healthcare ecosystem, payer, provider, and member goals can align. Only then can healthcare’s chronic faults be cured.
Realize the Renewed Promise of Healthcare IT
The cure for America’s healthcare crisis resides in the infinite alignment of stakeholders, systems, and data. That’s why we’re bringing you this six-part series investigating how the challenges of healthcare IT can be solved, and its failed promises finally realized, with innovative approaches to technology.
Learn How One End-To-End Solution Can Solve Every Stakeholder’s Challenges
We will personally curate a list of resources for you or share a personalized overview of how this solution is disrupting the Healthcare IT space.
(1) Hartman, Micah, et al. “National Health Care Spending In 2018: Growth Driven By Accelerations In Medicare And Private Insurance Spending.” Health Affairs, 5 Dec. 2019, www.healthaffairs.org/doi/abs/10.1377/hlthaff.2019.01451?journalCode=hlthaff.
(2) “Healthcare Costs for Americans Projected to Grow at an Alarmingly High Rate.” Peter G. Peterson Foundation, 1 May 2019, www.pgpf.org/blog/2019/05/healthcare-costs-for-americans-projected-to-grow-at-an-alarmingly-high-rate.
(3) “2018 National Healthcare Quality and Disparities Report.” AHRQ, Agency for Healthcare Research and Quality, Sept. 2019, www.ahrq.gov/research/findings/nhqrdr/nhqdr18/index.html.
(4) Papanicolas, Irene. “Health Care Spending in US, Other High-Income Countries.” The Commonwealth Fund, 13 Mar. 2018, www.commonwealthfund.org/publications/journal-article/2018/mar/health-care-spending-united-states-and-other-high-income.
(5) “HGP Releases Its Year-End Health IT Market Review.” Healthcare Growth Partners, 24 Jan. 2018, hgp.com/research-and-news/2018/01/24/hgp-semi-annual-health-it-market-review/.
(6) Parmar, Arundhati. “New JAMA Study Finds Administrative Complexity as the Single-Largest Source of Wasteful Spending.” MedCity News, 7 Oct. 2019, medcitynews.com/2019/10/new-jama-study-finds-administrative-complexity-as-the-single-largest-source-of-wasteful-spending/.
(7) Cole, Bryan, and Jeff Cribbs. “U.S. Healthcare Payer CIOs Boost Medicare Advantage Star Ratings Using Engagement Hubs and Insights.” Gartner, Gartner Research, 8 Aug. 2018, www.gartner.com/en/documents/3885775/u-s-healthcare-payer-cios-boost-medicare-advantage-star-.