Quiet period in healthcare analytics: lull before the storm?

A somewhat quiet period is continuing in the healthcare analytics market. At the end of February the annual conference of the Healthcare Information Management System Society (HIMSS) will take place in Las Vegas. Health IT companies and tens of thousands of attendees will congregate around the key theme of the event, “healthcare analytics and the rise in big data in healthcare.” I will provide coverage of HIMSS in my next column. In this article I will highlight a few new developments in the healthcare analytics space, which are both interesting and promising.

Big Employers Come Together to Transform Healthcare

Twenty major corporations including behemoths like IBM, Coca-Cola, Verizon and American Express recently announced a new alliance called the Health Transformation Alliance. The mission is to combine data on the health of their employees using analytics to discover the cost vs. benefit from their employer-sponsored health insurance plans. The project is expected to launch in 2017. Together those corporations spend $14 billion a year on healthcare for about 4 million people. That’s a lot of money and data!

In the United States there are two major payer groups: The government (Center for Medicare and Medicaid or CMS) and employers. Current data suggests that 55 percent of “non-elderly” people (less than 65 years of age) in the U.S. are covered by employer-sponsored health insurance. Employers usually buy group insurance from health plans or they are self-insured. In the latter case they pay for the healthcare of their employees.

Clearly hospitals and other care delivery organizations have a lot at stake when it comes to employers. This is a big initiative, and more details are yet to emerge. Does this alliance have the potential to create transformational pressure on the healthcare system? We have to wait for a year or two for a conclusive answer.

Health Insurance Exchanges Are Not in Danger

In my last column I highlighted four mega trends to watch for in 2016. One of those was consumerism in healthcare, which is poised to rise and influence healthcare in the coming years. A key aspect of that is the sustainability of the health insurance marketplaces. United Healthcare created a lot of noise last year with the announcement that it was leaving the health insurance exchange marketplace because of losses they suffered in that business. Many predicted that this could be the beginning of the end for insurance exchanges and Obamacare in general. But, a recent report from the Urban Institute suggests that United’s departure had practically no impact on exchanges.

Why is this important? If the insurance marketplaces stay, then consumers will have the opportunity to pick their own health plans. As expected, they will shop based on transparency of cost and value. Taking charge of one’s own health is the key driver for individuals being invested in healthcare. Therefore, a consumer-centric platform – and analytics that track consumer behavior to make the experience more engaging – will continue to emerge and get better over time. There is no barrier in sight for the rise of consumerism in healthcare.

More Hospitals to Invest in Data Warehouse and Mining

Technology procurement and adoption within hospitals is also changing. HIMSS Analytics published a new reportthat showed that, compared to 2015, about 500 percent more hospitals have plans to deploy clinical data warehousing and data mining technologies in 2016. This is a huge increase. Clearly, care delivery organizations have come to the realization that electronic health record (EHR) systems that they have bought and deployed during the past years are just data capture and billing systems. Organizations need to go beyond that to add sophistication to their decision-making process and be successful in the new world of payment reform.

Tech Companies Open Sourcing Artificial Intelligence Engines

Some interesting developments have started to happen in the technology world that are worth paying attention to. Microsoft recently announced that it is open sourcing its Deep Learning source code stack, dubbed CNTK, for developers. A couple of months ago Google open sourced its own artificial intelligence stack called TensorFlow. There were other open source initiatives in the Artificial Intelligence (AI) world in the past, but Google and Microsoft’s foray into this is significant.

Many pundits believe that those two technology giants, especially Google, are possibly many years ahead of other organizations in this area. This trend could open up more possibilities. Image and speech recognition are two major areas where AI engines are powerful. IBM is offering deep learning with its very own Watson in the cloud solution as well, albeit it is not open source. In fact, IBM is banking on its Watson technology for various businesses and its own internal corporate transformation.

Undoubtedly “deep learning” and AI are about to usher in a new era in analytics that will have profound impact on all industries. Healthcare will be no exception. Having said that, I would also like to caution all AI enthusiasts. Like any other new and transformational technology, let’s make sure we understand that it is neither the mathematics nor the coolness of the technology that transforms our everyday interactions. It is the usability at the point of use that does the trick. Can we interact with the AI in a manner like we do with a human?

That jump takes a while – possibly many years after the technology or the mathematical model emerges or matures. It will be a while before AI can become a significant part of our lives and healthcare. But one thing is for sure: Owing to Google and Microsoft’s actions, we may be able to reach that future faster by leveraging the power of the crowd.