Nancy Fabozzi's Blog

A New Era in Health Data Analytics: The Key to Health Care Transformation

13 Aug 2012 | by Nancy Fabozzi
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Health IT Needed to Transform Patient Care

The provision of health services is an exceptionally data-intensive endeavor. Of course, other industries are also very data-intensive but the health care industry has notably lagged in making use of advanced information technology (IT) solutions to manage and process vast troves of data. Health care data includes clinical medical information collected at the point of care, financial information resulting from highly complex billing and claims processing, and voluminous administrative and demographic data required as a result of significant legal and compliance requirements--all of which provides a rich resource for gaining knowledge and insight into best practices. Unfortunately, in health care, disjointed data is collected across highly fragmented systems that are still often predominately paper-based or, if electronically-based, are not usually amenable to interoperability with electronic systems used by various payers, providers, or government agencies. The whole thing is mess and everyone knows it but the good news is that this situation is rapidly changing today with the new emphasis on all things health IT, particularly advanced EHRs and new methods of health information exchange. Over the past decade, especially during the last five years, health care providers, including hospitals, have considerably accelerated their use of clinical IT systems such as EHRs. Thanks in no small part to the strong push from the federal government in the form of financial incentives provided by the HITECH Act, hospitals are focused on installing new EHR systems and digitizing clinical information that has traditionally been locked in paper-based silos. The growing adoption of health IT is key to the government's goals to transform our health care system, as laid out in the ONC's Federal Health IT Strategic Plan for 2011-2015 and summarized in the following chart -


 Growing EHR Adoption Drives Analytics Evolution to Next Phase

The growing use of EHRs is a very positive development on the road to health system transformation. In the next phase, newly digitized clinical data will be combined with financial and administrative data to yield new insights that will improve the quality, efficiency, and safety of patient care. Over the past 20 years or so, hospitals have steadily increased their knowledge and capabilities around digitally gathering and analyzing financial and administrative information. Thus, the digitization of financial and administrative data is further along in the hospital setting than is clinical data. Furthermore, the use of business analytics or business intelligence has been in place in most hospitals to some degree. Unfortunately, most hospitals have yet to adopt sophisticated analytic approaches to the data generated from their new EHR systems, and they particularly have not yet integrated clinical data with financial and administrative data.

Installing EHRs so that clinical data can be digitized and shared is the first step towards transformed health care. As EHR adoption grows, hospitals will need to aggressively move towards new processes and strategies to leverage clinical, financial, and administrative health data for the benefit of individual patients, patient populations, and the nation as a whole. Health care reform, the move to accountable care, and the prospect of bundled payments, or value-based reimbursement, are key drivers for the need to derive advanced insights from all forms of digital health data. Gaining value and insight from health data requires advanced, cloud-based data analytics solutions that pulls in data from all sources to provide both real-time and predictive insights, unlike the traditional retrospective, business intelligence approach of the past that mostly focused on financial analysis. Health data analytics is really a whole new approach to the analytics process that will impact every aspect of hospital operations.

It is clear that the future of health care will be increasingly driven by advanced health data analytics utilized at every point of care. We believe that the urgent need to transform our health care system will require hospitals to increasingly invest in advanced data analytics solutions to monitor end-to-end care delivery across a variety of settings as well as to provide comprehensive reporting on performance and quality measures to a variety of stakeholders. Understanding the key imperatives driving this phenomenon is essential. We take an in depth look at this issue in our new report, U.S. Hospital Health Data Analytics Market, 2011-2016: Growing EHR Adoption Fuels A New Era in Analytics, part of Frost & Sullivan’s Healthcare & Life Sciences IT Growth Partnership Service program.