David Asch, MD, director of the Center for Health Care Innovation at Penn Medicine

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Digital Health

Healthcare’s Data Readiness Crisis

Although “digital transformation” probably tops the list of commonly used healthcare buzzwords, a new report conducted by Morning Consult and commissioned by Innovaccer paints a clear picture of why the term has become so popular, as well as the barriers standing in its way.

The “Healthcare’s Data Readiness Crisis: Triage vs. Transformation” report is based on survey results from a blue ribbon panel of 75 US health system executives, which explored their current views with respect to digital transformation.

Among the highlights of the survey was the fact that 95% of respondents are focused on digital transformation, making it the number one imperative for the rest of the decade.

• 83% are aiming to have their organizations achieve full digital transformation in under five years, which might as well be a fraction of a second in healthcare time.

• To accomplish this, healthcare IT leaders are prioritizing solutions that can make a measurable difference in the near-term, such as population health (41%), hiring talent (40%), and competitive analysis (40%).

When asked about the obstacles that are stifling innovation, interoperability ranked as the leading technical challenge (41%), surpassing both implementation (25%) and data quality (23%).

• 42% said their organizations’ data is highly fragmented and siloed, and 58% didn’t believe that their EHR vendor could support their enterprise data strategy.

• Despite these hurdles, only 5% of executives are currently investing in data activation platforms that facilitate interoperability across all of their systems. 

Industry Impact

Out of all the takeaways from the report, the disconnect between healthcare’s high aspirations for digital transformation and the lack of data readiness that’s needed to support it is likely the biggest.

Across the industry, data and the insights it can reveal are trapped in disconnected siloes within each institution, yet many organizations are still tackling data optimization as a one-off project vs. a foundational capability. This results in short-term fixes to long-term problems and postpones any sort of true digital transformation.

As a result, only the health systems that crack the code on data readiness will have the foundation needed to sustain accelerated transformation over the long haul, which should create a durable competitive advantage over slower organizations while pressuring others to follow suit.

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The Wire

• On-Demand Nursing Unicorn: Technology-led nurse staffing startup IntelyCare completed a $115M Series D round, bringing its total capital raised to over $171M and its valuation to $1.1B, while allowing it to fund future geographic expansion and platform enhancements. Some might think those big numbers for a nurse staffing company, but they’re pretty justifiable for a gig economy platform that addresses one of healthcare’s biggest challenges. The IntelyCare platform allows healthcare organizations to “instantly fill” open shifts and absorb changes in staffing demand, while giving nurses the flexibility of gig work with the benefits of W2 employment.

• Hospital M&A Slowdown: Only 12 hospital M&A transactions were announced in the first quarter of the year, which was the lowest total since Kaufman Hall began tracking the metric in 2016. On top of the low total, there were no mega transactions where the acquisition target had revenues over $1B, driving down the average size of the smaller party to $246M (vs. $619M in 2021). Kaufman Hall referred to the results as “an interesting anomaly,” and expects activity to pick back up as the benefits of scale illuminated by the pandemic continue to cause an increase in strategic acquisitions.

• Eleos Health Series A: Behavioral health CareOps automation startup Eleos Health announced the completion of its $20M Series A round (total funding now $28M) that it will presumably use to fund the development and commercial expansion of its voice AI mental health application. The Eleos Health application operates ambiently during behavioral sessions (virtual or in-person), capturing and annotating each session to streamline provider documentation (-40% avg.) and support care decision making. Although we’re seeing Nuance’s ambient AI solutions make the biggest impact in other healthcare areas, Eleos also has company in the mental health space, including voice biomarker startup Kintsugi.

• Burnout & Outcomes: A new Health Affairs study suggests that physician burnout might have a different impact on patient outcomes than some might think. The study linked surveys from 1,064 family physicians to Medicare claims, finding no statistically significant relationship between self-reported burnout and a range of negative patient outcomes (admissions, ED visits, readmissions, or costs). In fact, physicians who reported burnout had consistently fewer negative events, suggesting that these doctors “may nevertheless be able to create better outcomes for their patients.”

• De-innovation: Becker’s recently published an interesting article exploring Cleveland Clinic and other organizations’ “de-innovation” processes for discontinuing practices that no longer benefit the health systems. The piece includes recommendations such as ensuring that “data from the legacy applications is archived and the technology is sunset” and that “hospitals should apply the same enthusiasm they have when launching new projects to asking the hard questions about which operations might need to be eliminated.”

• RPM Adoption Study: Just over half (57%) of US medical practices currently use remote patient monitoring solutions, according to a recent survey of 100 physicians and practice administrators from Rhythm Management Group. RPM adoption is expected to continue its recent momentum, with 76% of respondents reporting that they intend to launch RPM programs within the next two years. Currently, only 37% of independent practices offer RPM, but 27% plan on launching the services within the next two years, which seems to indicate a clear demand for solutions tailored to their needs.

• Eleanor Funding: Mental health startup Eleanor Health recently closed a $50M Series C funding round to expand its value-based care model for addiction and behavioral disorders. Eleanor’s approach is unique in combining whole-person care (psychiatry, health navigation, nurse case managers) with population-based partnerships through companies such as Tufts, Optum, and Aetna. These partnerships require Eleanor to proactively engage the most complex patients to improve outcomes, with the risk-sharing model benefitting all parties when successful.

• Intermountain and SCL’s Model Merger: Intermountain Healthcare and SCL Health officially completed their merger, growing Intermountain into a $12B nonprofit health system with 33 hospitals and 385 clinics across seven Mountain West states. The merger will bring Intermountain deeper into Colorado, Montana, and Kansas, while advancing the former SCL Health sites’ virtual and digital transformations and allowing them to tap into Intermountain’s patient value advantages.

• Maternal Mortality Report: A Commonwealth Foundation report found that the US has the most maternal mortalities in the developed world, as well as several access issues hampering wellness for women of reproductive age (18-49 years old). In 2020, there were 24 maternal deaths for every 100k live births in the US, three times higher than the 10 other high-income countries studied. The report attributes the issue to inadequate access to prenatal care and encourages US policymakers to expand federal guidelines for coverage of preventive services to encompass all women, including those enrolled in traditional Medicaid.

• Core vs. Chore Partnership: The American Medical Group Association announced a partnership with IKS Health to explore mission-critical core tasks for provider organizations and distinguish them from mission-supportive functions that can be delegated to streamline care delivery. The partnership is notable given its “core vs. chore” approach to re-evaluating how provider organizations are operationally structured, which could go a long way towards alleviating burnout when the AMGA shares the results in the fall.