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Most Interesting Vendors 2017: Optum

June 1, 2017
by Rajiv Leventhal
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Helping payers and providers push forward into risk-based healthcare

This year, as in past years, Healthcare Informatics has designated several vendor companies in healthcare IT as “Most Interesting Vendors,” and is featuring profiles of those companies in its Healthcare Informatics 100 issue, which this year is our May/June issue. The “Most Interesting Vendor” designation is not an award, but simply a recognition.

The trajectories of these companies speak to some of the broader trends taking place in healthcare IT in general and in the healthcare IT vendor market, and are thus of interest to readers. Healthcare Informatics’ Editor-in-Chief Mark Hagland’s profile of Epic can be read here. Below is our profile of Optum.

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The healthcare payer industry, much like its provider segment counterpart, is continuing to put more of an emphasis on predictive modeling approaches that will give insurance companies better insights into data they already have. The Minnetonka, Minn.-based UnitedHealth Group is one big-name payer that has forayed into the health IT space, as it offers products and services through two operating businesses, UnitedHealthcare and Optum, both subsidiaries of UnitedHealth Group.

In 2011, United HealthGroup’s health data subsidiary Ingenix rebranded as OptumInsight. In a press release at that time, Optum’s then-CEO said, regarding the unification of UnitedHealth Group’s health services businesses under the master brand Optum, “This step will make it simpler for clients to connect with the broad expertise and innovative capabilities across our businesses, so we can help them improve population health, reduce the cost of care and make healthcare work better for everyone.”

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Indeed, OptumInsight, the health data analytics arm of the Optum brand, develops its projections based on claims data covering 170 million lives, clinical data spanning around 80 million lives, data related to 3 million medical procedures, 8 billion laboratory results, and other such diverse data points, according to an April 2016 Market Realist article. In turn, this data enables the company to make accurate financial and clinical projections for its clients. Optum officials further note that the vendor now works with 300 health plans and approximately 80 percent of U.S. hospitals.

For years, Optum has ranked amongst the top companies in the Healthcare Informatics 100—an annual ranking of the top vendors with the highest revenues derived from health IT products and services earned in the U.S.—but in the last three years, the vendor has soared to the No. 1 spot on the list each year, due to Healthcare Informatics now allowing revenue derived from the payer market to be included. Indeed, with a 2016 health IT revenue of $7.33 billion, Optum’s success in helping health plans and provider organizations in the analytics space has become much more well-known. Rick Hardy, who is the chief operating officer of OptumInsight, encapsulates what the company has been able to accomplish into three big areas: moving beyond analytics “for analytics sake”; payer-provider collaboration; and creating modernization.

While analytics, according to Hardy, is “the kernel” of what OptumInsight is and how it started, what its clients—inclusive of payers, providers, life science companies and government entities—are now asking for is that since they have gotten to the point where the analytics are giving them insights into population health issues, and cost and quality insights, it’s now becoming about how to translate those into decision making on the front lines, be it clinical or administrative. “So it’s [becoming] about decisions on how to manage cost, and quality, too,” Hardy says. How we help our clients do that and how do we take our analytics and move them into the workflow of what they do every day? We have success stories in being able to help clients do risk-based contracts being put together by payers and providers, which are underpinned and completely informed by a set of analytics that our people and tools have helped developed,” he says.

Rick Hardy

Drilling down, Hardy notes that as health systems are now taking on more risk and looking at populations of people that they have to manage as opposed to someone showing up at the front door for an office visit, OptumInsight analytics “are a translation of population health management as well as of financial and risk management.” He says, “We have a long legacy of doing that for payers, and we are translating that into the provider world. This helps them negotiate risk-based contracts, so they now have an idea of how they will win in those contracts.” Hardy adds that the number of health systems that have that skillset of being able to win in a risk-based contract “is still really low.”

As such, Optum combines its analytics tools with its 1,000-person consulting team that brings its skillsets into clients’ four walls. “Now, you are managing that population,” he says, offering an example of a client that is using Optum’s full suite of analytics products and translating it into something tangible. This could sometimes be as simple as knowing which patients “need to get touched this week,” Hardy explains. “And they have that deployed through their community care teams, their emergency departments, and [other] high-risk therapeutic areas where they know those patients will drive utilization and cost. Now they’re on the hook to manage all of that,” he says.

What’s more, in Allentown, Pa., the four-hospital Lehigh Valley Health Network (LVHN) uses four Optum software models as well as 25 Epic electronic health record (EHR) software modules, and interfaces clinical data between the Epic EHR and Optum software, notes Mike Minear, the organization’s senior vice president and CIO. The focus, says Minear, is to leverage the strengths of both systems and integrate claims data and risk scores with clinical data and online clinical knowledge. “In both Optum and Epic, LVHN has created a number of clinical registries that surfaces and visualizes claim, clinical, and risk data elements that are used by clinicians in many different settings and roles, to optimize clinical and financial decision making,” he says.

More specifically, Minear explains that with an initial focus on high-risk patients, LVHN “has loaded Optum risk scores and other claims-created data points into the EHR, and continues to expand the care locations and providers that use this data in clinical encounters across the care continuum.” For the work done by LVHN’s clinical care teams (CCTs) using Optum and Epic, several studies have been performed to assess the impact of their care management and interventions, Minear continues. As such, material improvements were found in key outcomes (ED visits and hospital admissions) for patients managed by the CCTs when compared to a control group of patients not managed by CCT professionals, he says, attributing the results to “having both clinical- and claims-based data delivered via real-time analytics tools.”

Payer-Provider Convergence Becoming Collaboration

Not too long ago, healthcare payers and providers were considered adversaries, but market pressures have led the two sides to converge now, perhaps more than ever before, and Hardy actually sees the convergence turning into collaboration, slowly but surely. He asks, “How do we create ways to reduce the friction between payers and providers in the administration of healthcare? For the same things that help with the analytics part, how do we apply those things to a reduction of that friction, be it around utilization management, payments, claim, and quality, which is becoming more important? We have a large revenue cycle management business that takes our analytics tools, technology and workflow things that we do, and tries to create better connections into payers,” he says.

Certainly, Optum’s senior leaders are in a unique position when it comes to their vantage point on payers and providers working together, with many clients on both sides. Hardy admits that progress on collaboration is slow, but says it’s happening and it’s where things are going in the future. “I can’t speak for everyone, but I can speak for our clients and the work we do, so when we go in with our Optum360 [revenue cycle] business and take on end-to-end revenue cycle management for a health system, we build in performance guarantees. Some of these are tied to our ability to drive down denials and move from clean claims rates and how those get processed, and we can do that because we have a strong understanding of payer systems and how they think about processing through their adjudication system. This helps create more transparency across both sides,” he says.

Going beyond just OptumInsight, another goal is being able to go to both payers and providers and say that Optum has the capabilities that aren’t just the technology and the IT, but includes other ways to help drive what everyone wants to achieve in reducing cost, improving outcomes, and better management of populations, Hardy says. “We want to create relationships that are focused on those things, and then bring other assets to it, whether that’s our own care delivery assets or our ambulatory care assets. So it’s expanding the number of ingredients you can put in to help both sides think about the value they’re trying to create together in a community,” he says.

Innovating for the Future

That third bucket of Optum’s business acumen that Hardy mentioned, creating modernization, has to do with the administration of healthcare still being very fragmented, leading to a need to create true modernization of the back end. He says that much of it is also driven by still-manual processes that cause major lag times in information moving around. So, Hardy asks, “How do we create scale-efficient managed services across healthcare to provide a modernization of that infrastructure for the industry?”

For Optum, true innovation is not about creating the next analytics tool that creates a buzz, but more about how to really help its clients operationalize that best practice and operationalize the insight that is being created, Hardy says. “Yes, we are going to embrace the latest technologies and push the envelope around analytics, or how artificial intelligence can help us get better and faster at creating the insights and points of decision making, but all of that still needs to translate into how you operationalize that within a complex care delivery system,” he says. “You have a complex set of relationships with different constituents such as payers, providers, and patients, and that’s where innovation needs to happen in healthcare.” He notes that the key to that is “getting your hands dirty and getting on the ground with clients, and that’s why we have a 1,000-person consulting group. We’re down in there with our clients. We are a managed services vendor; not just someone who installs software and walks away.”

One of the things that Hardy feels Optum has done, but has not encapsulated it well yet, is showing that an impact has been felt in a community or a number of communities. “Can you say that in a local community, we are a difference maker, in terms of the health of that community, and the trajectory of what cost and quality looks like in that community? Hopefully we are looked at as an aggregator and enabler of how healthcare is done in that community—and in a good way, so less friction, less costly, and more efficient. That’s what I hope we are able to show, and we’re on our way,” he says. 


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VCU Health Motto: ‘In God We Trust; Everyone Else Must Bring Data’

October 19, 2018
by David Raths, Contributing Editor
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CMIO Colin Banas, M.D., talks about winning 2018 HIMSS Davies Enterprise Award

VCU Health System in Virginia was recently named a 2018 HIMSS Davies Enterprise Award recipient for leveraging health IT to improve outcomes. Colin Banas, M.D., the health system’s chief medical information officer, said the organization prides itself on using data to improve patient outcomes. “I am reminded of a quote from one of our senior leaders,” he said. “She even puts it at the bottom of her meeting minutes. It says, ‘In God we trust. Everyone else must bring data.’”

HIMSS cited three use cases that demonstrate VCU Health’s commitment to using data and technology to improve outcomes. The first is an Enhanced Recovery after Surgery (ERAS) protocol that improved colorectal surgery outcomes.

As VCU redesigns processes such as this, technology is always one of the last steps.   “When you sit in on these meetings, they are not going to talk about tech solutions for the first two months,” Banas said. “We stress the mantra of people, process and then technology. In a 7-stage flow chart, you don’t see technology until stage six and seven.” Once a team is identified and a standard of care is spelled out, then they turn back to IT and figure out how to hard-wire the changes into the electronic health record.

Because the VCU mascot is a ram, Banas said, the “ninja swat team” that works on process improvement projects is called the RAM Care team. RAM stands for reliable, appropriate and measurable. “We try to remind people that the RAM Care team is not just implementing order sets,” he said. There are five stages of people and processes first and then technology, including decision support and dashboards. “The way to drive variation out of a lot of these care processes is to be data-driven and consensus-driven,” he said. “That is what RAM Care really does – it is all about reducing variation.”

The other efforts HIMSS highlighted involved new tools that streamlined the patient discharge process and automated documentation tools that reduced catheter-associated urinary tract infections (UTIs).

Banas says it is an exciting time to be a CMIO. “We are getting out of the doldrums of regulatory reform and meaningful use, and ICD-10 sucking up all the oxygen, and we are starting to get better tools and better interoperability platforms to start doing innovative things,” he said.  He pointed to SMART on FHIR and open APIs as allowing users to do new things.

VCU Health is a client of Cerner, which has an Ignite API engine. “We have one SMART on FHIR app, Visual DX, and we have just signed the paper to allow the Apple health record beta for VCU Health, so our patients will be able to link their portal data to the native Apple experience,” he said. Cerner is creating its own app store. “Some are free and others have a cost, but it is exciting,” Banas said. “A lot of these people are solving things that have really bugged us and Cerner for quite some time, and they have done it way better. Kudos to Cerner for opening up and allowing other people in this space. They openly acknowledge that some of the things people are developing are in direct competition to core functionality they try to sell to their clients. Competition is good.”

 

 


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How a Data-Driven Approach Can Bolster the Fight Against Opioid Abuse

October 12, 2018
by Steve Bennett, Ph.D., Industry Voice
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I want to tell you about Andy. Andy’s mom, Pam, is a colleague of mine. Growing up an only child, Andy was a happy kid. He was a straight-A student, loved to play the violin, and spent a year as an exchange student in Europe. Andy had two loving parents. But Andy suffered an injury in college, and needed to have some minor surgery performed to repair his sinuses. Following that surgery, his doctor prescribed opioid pain medication for him, to which he became addicted. Despite several years of effort, Andy was unable to shake the addiction, and tragically lost his life to a heroin overdose two years after his surgery. This was a normal kid with a normal family, like mine, and like yours.

Andy’s story is an important story. The opioid epidemic has led to the deadliest drug overdose crisis in the history of the United States, killing more than 64,000 people in 2016 alone – the last year numbers were available. This is a true national epidemic, and one that continues to get worse. For the first time in nearly 60 years, life expectancy for Americans has dropped for two years in a row due to the opioid epidemic.

The opioid crisis has been so difficult to curtail, in part, because of the inability to integrate data from various stakeholders and systems. With so many players and data sources, today’s information is partial, fragmented, and often not actionable.

While this disconnect applies directly to the opioid epidemic it is a systematic problem that affects the healthcare community at large. Better data and analytics can help develop better treatment protocols for a wide array of medical and public health challenges that affect the general public. For opioids, that could be to develop better pain management programs or for better, more-targeted remediation and rehabilitation for those that become dependent on drugs.

A Data-Driven Healthcare Approach: Making Information Real

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Ample data has been collected on the opioid epidemic, but disparate sources are not communicating with one another. Addressing this disconnect and lack of communication is something that can provide researchers, lawmakers and the public with improved insights.

Data-driven healthcare can help provide this guidance by using available data and analytics to help create programs that can make a tangible difference on population areas that need the most help. By looking at the data, lawmakers, hospital administrators and doctors can begin to make impactful changes throughout the system.

While much can be learned from this data, most of it is not being analyzed in a way that brings true benefits. It has been put in a silo and/or it is not organized in a way that is interoperable with other data systems.

The 21st Century Cures Act, which established the Health Information Technology Advisory Committee, shows the commitment of national leaders to improving healthcare information sharing. Analytics can take this data and turn it into something real. Subsequent visualization of this analyzed data presents the information in a way that can truly tell a story, making sense of data that analysts sometimes miss. Analytics can arrange and organize data in different ways and pick up previously undetected trends or anomalies. This information can be turned into real programs that produce real outcomes for those affected.

The data management and integration process can also help us understand where our knowledge gaps are, revealing flaws in data quality and availability. Organizations may learn that they lack sufficient data in a certain area where they want to learn more, but are currently limited. They can then make changes to data collection efforts or seek out different sources to fill these larger gaps. They can resolve data quality issues across systems and arrive at a consistent, reliable version of the truth.

As organizations get better at assembling and managing the data, automating processes to generate standard reports and file exchanges can ease the burden on analysts. Streamlining the user interfaces for prescription drug monitoring programs and other systems allows analysts and medical informatics staff to spend less time working on the data itself and more time enabling and encouraging the use of predictive modeling and “what-if” scenario capabilities.

Helping to Solve a Problem

The national opioid epidemic is a terrible and complex issue. It is not something that can be solved with just one action, approach or program. It is a layered issue that will require systematic changes to how patients are treated and how the healthcare system operates. Some of the nation’s best continue to work on providing operational solutions to these problems, but as the statistics show, they need more help.

A data-driven approach can be that help. Using data analytics to find better and deeper insights into the root problems of this epidemic can help decision-makers make real change. While opioids are the focus now, there will come a day when a new problem emerges. Having data and analytic solutions in place can prepare these organizations to tackle these future challenges as well.

64,000 people died in 2016 as a result of opioid abuse. But 64,000 is more than a large number – it’s also Andy and his family. With analytics and a data-driven approach, government and healthcare leaders can make better decisions that can help people in need.

Steve Bennett, Ph.D., is the director of SAS' global government practice. He is the former director of the National Biosurveillance Integration Center within the Department of Homeland Security


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DOJ Approves CVS-Aetna $69B Merger, On Condition Aetna Divest Part D Business

October 10, 2018
by Heather Landi, Associate Editor
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The Department of Justice (DOJ) has approved a $69 billion merger between mega-pharmacy retailer CVS Health and health insurer Aetna, after Aetna entered into an agreement with the DOJ to divest is Medicare Part D prescription drug plan business.

According to a statement released by the DOJ on Wednesday, the settlement, in which Aetna will sell off its Part D business, was a condition of the merger’s approval and resolves the DOJ’s “competition concerns.”

The deal is the latest in a wave of combinations among healthcare companies, including many pharmacy benefit manager (PBM) and insurer integrations. Last month, the Justice Department approved Cigna’s $67 billion takeover of Express Scripts.

CVS Health announced in early December 2017 its intention to acquire Aetna in a $69 billion-dollar merger, marking the largest ever in the health insurance industry. Woonsocket, R.I.-based CVS operates the nation’s largest retail pharmacy chain, owns a large pharmacy benefit manager called Caremark, and is the nation’s second-largest provider of individual prescription drug plans, with approximately 4.8 million members. CVS earned revenues of approximately $185 billion in 2017. Aetna, headquartered in Hartford, Connecticut, is the nation’s third-largest health-insurance company and fourth-largest individual prescription drug plan insurer, with over two million prescription drug plan members. Aetna earned revenues of approximately $60 billion in 2017.

Following news of the deal back in December, there was speculation that antitrust regulators might not approve the deal. Back in January 2017, a federal judge blocked a merger that would have resulted in Aetna acquiring Louisville, Ky.-based insurer Humana, which at the time was the largest acquisition of its type in the history of health insurance in the U.S., reported at $37 billion. At the time, U.S. District Judge John D. Bates in Washington said that proposed deal would “violate antitrust laws by reducing competition among insurers.” Similarly, a proposed combination of two other health insurers, Anthem and Cigna, was also shot down last year.

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According to the DOJ’s statement issued today on the CVS-Aetna deal, the Justice Department’s Antitrust Division had significant concerns about the anticompetitive effects of the merger with regards to the Medicare Part D businesses. CVS and Aetna are significant competitors in the sale of Medicare Part D prescription drug plans to individuals, together serving 6.8 million members nationwide, according to the DOJ.

In a press release issued today, CVS Health said, “DOJ clearance is a key milestone toward finalizing the transaction, which is also subject to state regulatory approvals, many of which have been granted.” CVS Health's acquisition of Aetna remains on track to close in the early part of Q4 2018, the company said.

“DOJ clearance is an important step toward bringing together the strengths and capabilities of our two companies to improve the consumer health care experience,” CVS Health president and CEO Larry J. Merlo, said in a statement. “We are pleased to have reached an agreement with the DOJ that maintains the strategic benefits and value creation potential of our combination with Aetna. We are now working to complete the remaining state reviews.”

Merlo also said, “CVS Health and Aetna have the opportunity to combine capabilities in technology, data and analytics to develop new ways to engage patients in their total health and wellness. Our focus will be at the local and community level, taking advantage of our thousands of locations and touchpoints throughout the country to intervene with consumers to help predict and prevent potential health problems before they occur. Together, we will help address the challenges our health care system is facing, and we'll be able to offer better care and convenience at a lower cost for patients and payors.”

Following the close of the transaction, Aetna will operate as a standalone business within the CVS Health enterprise and will be led by members of its current management team.

The American Medical Association (AMA), an industry group that has been opposed to the merger, issued a statement saying the agreement that Aetna divest its Part D business doesn't go far enough to protect patients.

"While the AMA welcomes the U.S. Department of Justice (DOJ) requiring Aetna to divest its Medicare Part D drug plan business, we are disappointed that the DOJ did not go further by blocking the CVS-Aetna merger," Barbara L. McAneny, M.D., president, American Medical Association, said in a statement. "The AMA worked tirelessly to oppose this merger and presented a wealth of expert empirical evidence to convince regulators that the merger would harm patients. We now urge the DOJ and state antitrust enforcers to monitor the post-merger effects of the Aetna acquisition by CVS Health on highly concentrated markets in pharmaceutical benefit management services, health insurance, retail pharmacy, and specialty pharmacy."

Agreement with DOJ Resolves “Competition Concerns”

Late last month, Aetna agreed to sell its Part D business to WellCare. According to a Securities and Exchange Commission (SEC) filing from WellCare Health Plans last month, WellCare entered into an asset purchase agreement with Aetna to acquire the company’s entire standalone Medicare Part D prescription drug plan business, which has 2.2 million members. According to the agreement, Aetna will provide administrative services to and retain the financial risk of the Part D business through 2019. In that filing, it states that Aetna is divesting its Part D business as part of CVS Health’s proposed acquisition of Aetna.

“Today’s settlement resolves competition concerns posed by this transaction and preserves competition in the sale of Medicare Part D prescription drug plans for individuals,” Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division, said in a statement. “The divestitures required here allow for the creation of an integrated pharmacy and health benefits company that has the potential to generate benefits by improving the quality and lowering the costs of the healthcare services that American consumers can obtain.”

In its statement, the DOJ referred to WellCare as “an experienced health insurer focused on government-sponsored health plans, including Medicare Part D individual prescription drug plans.”

The Department’s Antitrust Division, along with the offices of five state attorneys general, today filed a civil antitrust lawsuit in the U.S. District Court for the District of Columbia to enjoin the proposed transaction, along with a proposed settlement that, if approved by the court, would fully resolve the Department’s competitive concerns. The participating state attorneys general offices represent California, Florida, Hawaii, Mississippi, and Washington.

In a complaint filed to the U.S. District Court, DOJ attorneys argued that without the divestiture, the combination of CVS, which markets its Medicare Part D individual prescription drug plans under the “SilverScript” brand, and Aetna would cause “anticompetitive effects, including increased prices, inferior customer service, and decreased innovation in sixteen Medicare Part D regions covering twenty-two states.” DOJ attorneys also argued that the loss of competition between CVS and Aetna would result in “lower-quality services and increased costs for consumers, the federal government, and ultimately, taxpayers.”

Under the terms of the proposed settlement, Aetna must divest its individual prescription drug plan business to WellCare and allow WellCare the opportunity to hire key employees who currently operate the business.  Aetna must also assist WellCare in operating the business during the transition and in transferring the affected customers through a process regulated by the Centers for Medicare and Medicaid Services (CMS).

 


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