The New Year begins where 2015 left off—with major health IT challenges, as the industry seeks to transform the quality and efficiency of healthcare as the industry makes its transition to new value-based payment models.

As reimbursement increasingly focuses on value, health systems will pursue lower-cost settings more aggressively than before, while employing innovative approaches to distributing care. That’s among the findings of PricewaterhouseCoopers’ annual report of the trends that will have the biggest impact on the industry.

Healthcare analytics in 2016 will continue to make sense of the vast quantities of health data that provider organizations have to wade through, turning it into actionable insights to improve patient care. PwC predicts new databases and database tools will enable providers and payers to analyze data from many sources in novel ways.

“High hopes surrounding big data investments in healthcare have been dampened by the challenge of converting large and diverse datasets into practical insights,” the consulting firm suggests. “In 2016, the health industry will begin to use these data in new ways, thanks to high-tech, so-called ‘non-relational’ databases. These databases arrive at a time when the industry is thirsting for ways to make good use of a swelling ocean of consumer and health data.”

PwC says traditional relational databases, such as electronic health records systems, organize data into columns, rows and tables, forcing information into predetermined categories. The problem, the firm says, is that while these databases are ideal for information that is easily structured, they cannot handle information such as clinician notes, transcripts and other unstructured data as easily. But, newer databases will make it easier to “bypass the rigid structure and analyze many different forms of data together,” according to PwC.

The new year also will also be a “year of firsts for healthcare consumers, organizations and new entrants, as innovative tools and services enter the New Health Economy,” concludes the firm. Kelly Barnes, PwC’s U.S. health industries leader, defines this “New Health Economy” as a “health system that is more connected, transparent and patient-centric.”

According to PwC, this year millions of American consumers will have their first video consults, be prescribed their first health apps and use their smartphones as diagnostic tools for the first time. Thanks to mobile healthcare technology and shifts in financial incentives, care will begin to move into the palms of consumers’ hands, providing care anywhere and anytime, argues the firm.

At the same time, as the health system moves away from fee-for-service reimbursement, clinicians are leveraging virtual medicine to support population health initiatives and expand telehealth services in such areas as behavioral health. In addition, PwC says “employers are embracing connected tools to engage employees in wellness programs and chronic disease management; health plans are using the same to reduce spending.”

However, the firm cautions that the growth of mHealth brings with it inherent cyber security risks for the healthcare industry.

2015 was the year of major health data breaches, costing the industry billions of dollars in financial losses with an unprecedented number of records compromised. The sector remains vulnerable, and PwC forecasts that 2016 will be another big year for data breaches. The PwC report contends that most healthcare organizations are unprepared to address new threats and lack adequate resources to protect patient information from these kinds of cyber attacks.

“As security breaches become more common and costly, medical device cyber security will emerge as a major issue in 2016, requiring device companies and healthcare providers to take pre-emptive action to maintain trust in medical equipment and to prevent breaches that could cripple the industry,” states PwC, which cites the fact that 2015 saw the first-ever government warning that a medical device (infusion pump) was vulnerable to hacking.

While the industry’s adoption of health IT continues unabated, the firm notes that other challenges continue to stand in the way of progress. “Questions about who owns the data persist, impeding information sharing, formation of partnerships and the seeming holy grail of interoperability,” warns the firm.

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