Competing With Data & Analytics
Many unsustainable aspects of our health care system can be improved with technology. Opportunities abound with evidence-based medicine, population health analytics, in-home monitoring, as well as with data-driven incentive systems. Organizations like WellPoint can strategically capitalize on the inevitable disruption — or be left behind by competitors that do.
WellPoint’s laudable efforts to use technology to improve health outcomes and lower costs recognize the physician context and use an incremental approach designed to build the credibility required to launch the company’s new provider payment system. They conducted “nearly a dozen pilots with physicians” and focused on “three to five things…to get the Enhanced Personal Health Care program off the ground.” All bode well for achieving significant cost reductions for WellPoint (“20% if successful”) and for earnings increases for physicians (up to “50%”), not to mention the promise of enhanced health care outcomes for WellPoint’s subscribers.
Even if WellPoint had the perfect technology, however, the challenge of organizational change would be daunting. WellPoint is attempting to introduce new technology and revamp deeply entrenched compensation systems that reflect diverse incentive structures. Despite trying to minimize the program’s scope, WellPoint still had to integrate data from “14 separate health plans with inconsistent approaches to defining similar types of data.”
This is not unusual — I suspect the new provider payment system uncovered many system integrations put together with duct tape under tight acquisition deadlines. The organizational problem was complicated further by tight deadlines that prevented the IT team from mastering these issues. Ideally, the company would have had the time to decouple certain technology issues from the rest of the program and effectively address them before rolling out reports to providers.
But the reality is that the program team was under significant pressures to simultaneously meet deadlines, adopt a new software development approach (new for them at least — Agile is now a well-recognized approach in the software field), overcome data integration challenges and create a novel product for use by external stakeholders. Given the complexity of the undertaking, it is not reasonable or cost effective to expect IT to become experts in the intricacies of the insurer–provider relationship.
An alternative approach would be to focus IT on areas in which their expertise can be most effective — such as providing technological infrastructure, harmonizing systems and data, and creating components for use by domain experts.