There’s little doubt that healthcare organizations need to improve their data analytics strategies, which are critical to performing well in the new reimbursement environments that lie ahead. Yet, it often falls to CIOs and other execs to help CEOs and CFOs understand the value of analytics and to make the case as to why the technology needs to be a strategic priority for their organizations.

Mike Garzone, director of technology services for consultancy CTG Health Solutions, has been serving the healthcare industry for more than 30 years and argues that data-driven organizations need to be the “owners” of business and clinical analytics and not the traditional customers for “IT-incubated” initiatives.

“It’s super important that folks at the C level get this and that’s why the organizational owner should not be the CIO,” said Garzone. “We won’t get the same level of adoption and prioritization within the organization as we would with the CEO or CFO. What I try to do when I talk to these folks is drive home the fact that data is the asset and you can’t manage what you can’t measure. You have to use data to measure what you’re doing—whether that’s operational performance, clinical outcomes, cost reduction, or hospital readmissions.”

Simply put: analytics are designed to reveal and understand historical patterns of data to predict and provide actionable insights to improve the performance of healthcare organizations. Among other insights, analytics reveal at-risk patients, optimal treatments, fraudulent claims, and physician performance.

“In the broad sense, it’s all about patterns,” says Garzone.  “We’re looking to identify patterns so that we can help predict an outcome and see how we can change to influence the outcome. If you have to climb to the top of Mount Everest, you’re going to need something to guide you there and that data and those analytics are going to be your Sherpa.”

Also See: Survey Finds Only 15% of Hospitals Use Advanced Predictive Modeling

With the industry’s ongoing shift from fee-for-service to a value-based payment model, he believes the importance of analytics for healthcare organizations will become even more critical for achieving success. The only way that these organizations will succeed in making fundamental changes in their day-to-day operations that improve the quality of care and reduce costs is to “truly measure things” through analytics, according to Garzone, who adds that “data is the key.”

He recommends talking to C-suite executives not in IT-speak but in business terms such as key performance indicators, because if you attempt to explain health analytics with references to data warehousing and aggregation it will not resonate with them. As a jump off point, Garzone advises asking execs how they currently measure their organizations’ success. “It might not necessarily be clinical,” he comments. “It could be growth goals to build 10 more hospitals and to drive a percentage of ER visits out to regional clinics—all of those are measurable initiatives that are going to require clean, timely, trusted data to be able to know if you’re achieving those goals or not.”

Not surprisingly, the projected growth of health analytics is nothing short of staggering. According to new research from consultancy MarketsandMarkets, the global healthcare analytics market is predicted to grow to $18.7 billion by 2020 from $5.8 Billion in 2015—at a compound annual growth rate (CAGR) of 26.5 percent over the next five years. Driving this growth in analytics is the “rise in pressure to curb healthcare costs, Meaningful Use incentives, availability of big data in healthcare, technological advancements, and increase in venture capital investments,” states the research firm, which also notes federal mandates such as the implementation of electronic health records and ICD-10 code sets and the overall shift towards value-based medicine with increased focus on quality of care and reduced costs.

“The push for Meaningful Use and adoption of EHRs was great and a lot of people went through that because there was a stick and they took the stick approach instead of the carrot. But, now that all that data is there, it’s time to look for the carrot,” asserts Garzone. “The CFOs will get it from the financial side and the CMIOs understand things from the patient safety perspective and the clinical piece. It’s great to be in compliance with regulations but beyond that how do you really need to improve? And, how do you measure and track that progress? You’re going to need analytics to do that.”

At the same time, the explosion of big data in healthcare is making analytics an absolute requirement. “It’s not too terribly difficult to collect data. In fact, data collection is what’s happening right now through a multitude of sources—the challenge is using the data that you collect,” according to Garzone.   

Among healthcare’s various end users, MarketsandMarkets forecasts that the providers segment is expected to grow the highest during the 2015-2020 forecast period. However, at the same time, the firm warns that an operational gap between payers and providers, lack of skilled personnel, and high cost of analytics solutions may restrict market growth. In addition, multiple industry surveys tell the same story: while providers are starting to understand the value of health analytics, very few have actually implemented the technology.

A recent survey of 271 healthcare professionals conducted by advisory firm KPMG found that only 10 percent believe their organizations are using data and analytics at their highest potential and 21 percent are still in their “infancy” when it comes to data/analytics capabilities. Of the other respondents, 16 percent indicated they are using data in strategic decision making, 28 percent are relying on data warehouses to track key performance indicators and 24 percent are using data marts.

“Many organizations are not where they need to be in leveraging this technology,” said Bharat Rao, KPMG’s national leader for healthcare and life sciences data analytics. “Healthcare organizations need to employ new approaches to examining healthcare data to uncover patterns about cost and quality, which includes safety, to make better informed decisions.”

Though healthcare organizations acknowledge the benefits of analytics such as business intelligence (34 percent), improving clinical outcomes (27 percent) and lowering costs (24 percent), those surveyed by KPMG identified several hurdles to implementing the technology: unstandardized data in silos (37 percent), lack of technology infrastructure (17 percent), and data and analytics skills gaps (15 percent).

Add to those challenges the revenue shift that will negatively impact providers as value-based payment becomes the norm, and Garzone foresees a transition phase in which healthcare organizations will take “financial hits” where they previously enjoyed profitability in their fee-for-service businesses. “Everyone is going to take a hit,” he cautions, but successful organizations will weather the storm by embracing analytics as a means to achieve accountable care through measurable performance metrics.

Fee-for-service is “very transactional” but with the transition to a value-based model in which accountability becomes the goal of care delivery, Garzone argues that the organizations who will do the best at accountable care are the ones that embrace data analytics and make it central to their business process starting from the C-suite down. “That is the only way it will impact workflow, behavior, decisions, and the actions that people are taking throughout the organization,” he concludes.         


Register or login for access to this item and much more

All Health Data Management content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access