2014
AN EVEREST GROUP VIEWPOINT
Health Outcome Analytics
Overcoming Data Integration, Stakeholder Collaboration, and Talent
Issues to Operationalize Analytics
This report has been
licensed for exclusive use
and distribution by Genpact
Abhishek Menon, Practice Director
Anupam Jain, Practice Director
In the United States 96 people per 100,000 die annually from conditions
considered amenable to healthcare1.
Benefits
Better predictability on health
outcomes from different
drugs/procedures
 Better revenue/reimbursement
forecasting

Keys to operationalize health
outcome analytics
 Digitization and
standardization of data
 Government regulations
 Collaboration across
organizations
The healthcare costs are steadily rising, however, the corresponding health
outcomes are either static, at best, or deteriorating. The instances of
readmission and remission are on the rise. The number of diagnostic tests and
procedures being conducted on patients is increasing, however, the patient’s
satisfaction with the treatment is declining.
Regulations such as the Patient Protection and Affordable Care Act (PPACA) are
realizing this major dichotomy in the healthcare industry and are driving
towards greater focus on health outcomes rather than the input. Affordable
Care Organizations (ACO) created under the aegis of PPACA have started to
focus more on health outcomes and will in fact be reimbursed based on the
results achieved and feedback from the patients. Healthcare payers are pushing
for a move to a similar outcome-based payment system with all healthcare
providers.
Why important........................1
Current drug testing and trials are able to identify a drug’s efficacy (measured in
a trial environment) but provide limited insight into a drug’s effectiveness
(performance in uncontrolled, everyday practice). In order to drive better
outcomes, healthcare providers are more interested in understanding and
prescribing drugs based on their effectiveness. Healthcare payers are also
pushing for reimbursing pharmaceutical firms based on the outcomes their
drugs have been able to produce (see Figure below).
Impacts of analytics.................2
Increased focus on analytics to drive better health outcomes
Operationalizing analytics....2-3
Industry challenges
Conclusion.............................4
Healthcare payers
Re
Static/deteriorating
health outcomes
Emerging priority
Healthcare
regulations (PPACA)
Healthcare
providers (ACO)
on
ed
bas s
ent come
t
em
u rs r e o u
a
i mb
Re ealthc
h
Increasing
healthcare costs
Changing industry dynamics
i mb
on urse
h e a me
lthc nt/ra
tin
a re
out g ba
com sed
es
Fast reference
Analytics leveraged
to move to outcomebased healthcare
systems
Pharma / Life
Sciences companies
Select drugs/products
based on outcomes
1 Commonwealth Fund National Scorecard on U.S. Health System Performance. 2011
research.everestgrp.com
EGR-2014-12-V-1156
1
HEALTH OUTCOME ANALYTICS
Impact of leveraging health outcome analytics
“
We were able to replace a
multitude of reports with a few
more insightful dashboards.
– CFO of European healthcare
provider
Health outcome analytics can drive benefits ranging from basic reporting to
advanced prescriptive analytics (see Figure below). Health outcome analytics
can be used by healthcare payers to identify those providers that drive superior
health outcomes and helps link reimbursements to the actual outcomes being
achieved. Providers can also be rated based on the health outcomes that they
are able to drive.
“
Healthcare providers can forecast revenue based on the health outcomes being
generated, giving increased predictability in a health outcome-based
reimbursement environment. Pharmaceutical firms can also forecast revenue for
their drugs based on aggregation of effectiveness data. Insights from this
effectiveness data can also act as inputs into existing and future drug
development efforts.
“
We have seen our readmission
rates dropping, especially for
critical ailments.
– Head of U.S.-headquartered
healthcare provider
Healthcare practitioners can use effectiveness data to come up with better
probability estimates for drugs and medical procedures supported by specific
scenarios based on patient demographic and other unique factors. Going
forward, advanced prescriptive analytics can be used as a guidance tool for
medical practitioners to choose the best medical approach/procedure based on
the effectiveness analytics.
Range of health outcome analytics
“
Increasing business impact
1. Reporting


Drug effectiveness
reporting
Patient health
outcomes reporting
2. Descriptive
analytics
 Dashboards for
medical practitioners
on drug
effectiveness under
various conditions
 Rating of healthcare
providers based on
health outcomes
achieved
 Reimbursement
calculations based
on health outcomes
3. Predictive
analytics
 Revenue forecasting
based on health
outcomes for
providers
 Revenue forecasting
for pharmaceutical
firms based on drug
effectiveness
 Probability
estimation for
potential medical
procedures
4. Prescriptive
analytics
 Developing insights
for drug
development teams
based on health
outcome reporting
 Guidance to medical
practitioners on best
medical procedure/
approach
Increasing sophistication of solution
Successfully operationalizing health outcome analytics
“
If you have seen doctor’s notes
you know the data problems that
the industry faces.
– Head of U.S.-headquartered
healthcare provider
“
research.everestgrp.com
EGR-2014-12-V-1156
While health outcome analytics can drive significant benefits, it is still a fairly
nascent practice and has challenges that need to be addressed.
1. Lack of data integration. The data required to drive outcome analytics is
distributed across various sources and formats. Clinical trial data, hospital
records, physician notes, research papers, patient demographic, and
characteristics data (including digital/social media information) need to
2
HEALTH OUTCOME ANALYTICS
come together to drive health outcome analytics. They also range in formats
from structured Electronic Health Records (EHR) to voice recording by
physicians
“
There is not a lot of high-end
health outcome analytics
happening due to a lack of data
and talent.
– Analytics Lead for a healthcare
payer
2. Lack of collaboration. The various sources of data also reside with the
different stakeholders in the industry. Healthcare payers, providers,
pharmaceutical firms, research groups, and digital/social media firms hold
data that needs to come together. Currently, there is a reluctance to share
data across stakeholder groups and even within groups, as they perceive
each other as competitors
3. Limited availability of talent. Health outcome analytics requires a unique
blend of talent with knowledge of analytics, statistics and healthcare
domain, which is difficult to find. Also, considering the nascent nature of
high-end health outcome analytics there are limited professionals with
significant experience in this space
“
The healthcare industry has started taking steps to overcome some of these
challenges:



research.everestgrp.com
EGR-2014-12-V-1156
Digitization and standardization of data. There is a concerted effort to
digitize and standardize the various data sources needed for healthcare
analytics. The adoption of EHR is on the rise with more and more providers
moving to it. Advancement in text and voice analytics is helping convert
notes and recordings from medical practitioners into structured digital
formats. Pharmaceutical firms have started integrating their clinical trial data
with Pharmacovigilance (PV) data to drive better analytics
Government regulations. The PPACA and related regulations are pushing
the healthcare industry towards adopting health outcome analytics. The
incentivizing of EHR adoption, advent of ACOs, and the general push
towards reimbursements based on outcomes is encouraging the industry to
adopt steps to enable health outcome analytics. The Health Insurance
Portability and Accountability Act’s (HIPAA) is providing the framework to
share data while protecting the privacy of individuals
Collaboration across organizations. The intra-group collaboration is on the
rise. Large healthcare payers are creating analytics organizations and
providing services to other smaller payers. The pharmaceutical firms are
coming together by sharing PV data with each other. The healthcare
providers have started aligning towards common EHR formats and also
sharing information among themselves
3
HEALTH OUTCOME ANALYTICS
Conclusion
Health outcome analytics can help bring about a tectonic shift in the healthcare
industry by moving from a traditional input-focused to an outcome-focused
approach. Beyond just reducing healthcare costs, analytics can drive better
health outcomes. However, high-end health outcome analytics is still in a
nascent stage and there are significant challenges that need to be overcome to
drive increased adoption. Those successfully operationalizing analytics to
improve outcomes must be prepared to aggressively digitize and standardize
data, while collaborating across varied and multiple external groups.
This study was funded, in part, by support from Genpact
For more information about
Everest Group, please contact:
+1-214-451-3110
[email protected]
For more information about this
topic please contact the authors:
Eric Simonson, Managing Partner
[email protected]
Rajesh Ranjan, Vice President
[email protected]
Anupam Jain, Practice Director
[email protected]
research.everestgrp.com
EGR-2014-12-V-1156
About Everest Group
Everest Group is an advisor to business leaders on next generation global services with a
worldwide reputation for helping Global 1000 firms dramatically improve their
performance by optimizing their back- and middle-office business services. With a factbased approach driving outcomes, Everest Group counsels organizations with complex
challenges related to the use and delivery of global services in their pursuits to balance
short-term needs with long-term goals. Through its practical consulting, original research
and industry resource services, Everest Group helps clients maximize value from delivery
strategies, talent and sourcing models, technologies and management approaches.
Established in 1991, Everest Group serves users of global services, providers of services,
country organizations, and private equity firms, in six continents across all industry
categories. For more information, please visit www.everestgrp.com and
research.everestgrp.com.
4