Share with your friends










Submit

Analytics Magazine

Healthcare Analytics: Tighten your belt as healthcare industry slows down … but stay hopeful

Rajib GhoshBy Rajib Ghosh

In my last article, I mentioned that the Affordable Care Act (ACA) dodged the bullet but the attack would continue after the first incarnation of American Healthcare Act (AHCA) failed on the House floor. It didn’t take long for the House to get the second incarnation ready and get that passed, albeit without the Congressional Budget Office (CBO) score. The Senate now has it, but apparently they are working on their own bill that pundits expect to be a complete rewrite of the House bill. Meanwhile, the CBO came out with its scoring of the new incarnation of the House Bill and found it to have a large, negative impact on the healthcare of the elderly and the poor with a projected 23 million people expected to lose health insurance over a 10-year period, including 14 million from Medicaid.

On the positive side, the bill is expected to reduce the deficit by saving overall healthcare costs, which is intuitive since a smaller number of high-risk or high-utilizer people would be covered by the bill.

With all the drama going on in Washington these days, it is unclear when a real and final bill would come out of the Senate for the public debate and subsequent implementation. It is unfortunate that during this time of uncertainty access to healthcare for many people will recede as the insurance companies, being unable to figure out their upcoming risks, would play it safe and move out of many state health insurance exchanges. Medicaid expansion states would not be affected during this period, but they would be the first to feel the brunt should the Senate bill follow the same line of thinking as the House bill.

Healthcare politics, health policy and healthcare technology, which includes analytics, go so much together in our country that it is impossible to separate them. Politics determine federal and state policies, which in turn dictate provider and payer behavior and their subsequent adoption of technology solutions. If we return to the era of volume-based care, many healthcare technology solutions such as population health management or analytics to reduce hospital readmission won’t remain a priority, albeit the trailblazers would surely continue that path. Providers want to do things better, but they might not focus on doing better things. In other words, transformational change that healthcare analytics usher in would lose momentum. So, it is important to track healthcare politics and policies and analyze their impact so we understand the future direction of healthcare analytics.

Imminent Slowdown in the Healthcare Industry

After several years of rapid expansion of the healthcare industry, which analysts say was fueled by high debt growth, the growth rate is expected to slow down in the coming years. The 308 percent debt growth since 2009 is not supported by the demand growth. Large investments went into brick and mortar acquisitions, job growth and rapid mergers/acquisitions.

A recent report published by John Burns Real Estate Consulting company identified the risk of the industry pulling back and its impact (see Figure 1). The risk has already started to manifest itself in a few news items that came out recently including the large sell off of hospitals by Community Health Systems. Coupled with the uncertainty in the rise of uncompensated care with the AHCA’s attack on Medicaid, it is quite clear that brick and mortar expansion of the provider network will slow down in the coming months and years. However, the load of chronic disease management won’t go away as the population continues to age. The brick-and-mortar-based healthcare delivery channel will transform to a lower cost, virtual-care model. This transformation won’t be possible without digital technology, advanced data analytics and, in the near future, use of artificial intelligence. That’s the good news for my colleagues in the field.

health care analytics

Figure 1.

Rapid Rise of AI Companies in Healthcare

The scope and the use of artificial intelligence in healthcare is increasing. The technology is making progress at a rapid rate. Innovators and investors are both building and funding new companies to accelerate the growth. Six years ago, I was exposed to the digital nurse avatar created at Northeastern University. I was fortunate to meet Professor Timothy Bickmore, whose research found that patients waiting for hospital discharge resonated well when the non-human “Elizabeth” interacted with the patients instead of a human nurse. The technology has only become smoother since then, as natural language processing (NLP) powers have increased. As a result “avatar with digital empathy” is gaining momentum. CB Insights recently reported 106 companies that are working on AI and machine learning in many areas of healthcare, from virtual nurses to drug discovery (see Figure 2).

healthcare analytics startups

A recent global trend study published by Tata Consultancy Services stated that 86 percent of provider organizations, life sciences companies and technology vendors are using AI in their solution stack to improve business operations. This trend will continue through 2020 and beyond. The road for AI is not free of challenges, however. For example patient privacy is a big issue; an uproar ensued after the data sharing deal between Alphabet’s DeepMind AI company and National Health Services (NHS) of the United Kingdom became known. Nonetheless, consulting firm Frost & Sullivan predicts that by 2025 AI systems could be involved in everything from population health management to digital avatars like what Dr. Bickmore showed me in 2011.

AHCA in its current House incarnation or after the Senate rewrite is expected to bring forward several of ACA’s provisions. Nonetheless, the threat of uncompensated care for hospital-based systems is real. The complexity of the American healthcare system value chain is such that it is hard to find a silver bullet that ensures access to care for all while reducing the cost of care delivery. The only option is rapid transformation with digital health and AI. Hospital bed days and pharmaceutical costs, two of the biggest contributors to the overall cost of care, will have to be reined in through efficient post-acute care management, reduction in drug discovery cost and policy changes.

On both fronts technology, data and analytics would be the game-changers, but they need to be embraced with an open mind. The cost of these technologies also needs to come down so that providers can achieve better ROI, faster. At the beginning, many things would not be perfect, but with rapid iterations, technologies would deliver on their promises. While I am issuing a word of caution for my colleagues in this field expecting an imminent slow down, I am also encouraging them to feel hopeful about the field for the next five to 10 years.

Rajib Ghosh (rghosh@hotmail.com) is an independent consultant and business advisor with 20 years of technology experience in various industry verticals where he had senior-level management roles in software engineering, program management, product management and business and strategy development. Ghosh spent a decade in the U.S. healthcare industry as part of a global ecosystem of medical device manufacturers, medical software companies and telehealth and telemedicine solution providers. He’s held senior positions at Hill-Rom, Solta Medical and Bosch Healthcare. His recent work interest includes public health and the field of IT-enabled sustainable healthcare delivery in the United States as well as emerging nations.

Analytics data science news articles

Related Posts

  • 79
    Following the 2016 presidential election, the first two months of the new year were quite tumultuous for the U.S. healthcare system. Interestingly, the Affordable Care Act (ACA) has survived so far, albeit the process to repeal the law has begun.
    Tags: healthcare, analytics, ai, health, care, technology
  • 67
    The Israeli Ministry of Health recently agreed to reverse a blood donation policy and will now allow some Ethiopian immigrants, homosexuals and elderly people to donate blood. According to the Jerusalem Post, the change is a result of “new local and foreign epidemiological data and the improvement in medical technologies…
    Tags: health, analytics, healthcare
  • 62
    As healthcare organizations transition to value-based care, there is an increasing need for actionable information. Many organizations do not know where to start in building an information framework that assists with decision-making and drives actions. Provider organizations, particularly large, complicated health systems, have incredible amounts of data spread over several…
    Tags: analytics, healthcare, technology, health, care, management
  • 61
    The 2016 election is a watershed moment for the U.S. healthcare industry. Any presidential election and change of guards come with changes in policies. It happened in 2008 when President Obama was sworn into the office. That led to the establishment of the Affordable Care Act (ACA) or Obamacare. To…
    Tags: healthcare, care, health, analytics, management
  • 59
    The last two months were eventful for healthcare. The Affordable Care Act (ACA) endured another repeal-and-replace attack in congress. The latest bill, known as the Graham-Cassidy bill, was withdrawn by Senate Republican leaders when it became clear that the bill would not receive the 50 votes needed for passage.
    Tags: health, healthcare, care, bill, analytics


Headlines

Former INFORMS President Cook named to U.S. Census committee

Tom Cook, a former president of INFORMS, a founding partner of Decision Analytics International and a member of the National Academy of Engineering, was recently named one of five new members of the U.S. Census Bureau’s Census Scientific Advisory Committee (CSAC). The committee meets twice a year to address policy, research and technical issues relating to a full range of Census Bureau programs and activities, including census tests, policies and operations. The CSAC will meet for its fall 2018 meeting at Census Bureau headquarters in Suitland, Md., Sept. 13-14. Read more →

Gartner identifies six barriers to becoming a digital business

As organizations continue to embrace digital transformation, they are finding that digital business is not as simple as buying the latest technology – it requires significant changes to culture and systems. A recent Gartner, Inc. survey found that only a small number of organizations have been able to successfully scale their digital initiatives beyond the experimentation and piloting stages. “The reality is that digital business demands different skills, working practices, organizational models and even cultures,” says Marcus Blosch, research vice president at Gartner. Read more →

Innovation and speculation drive stock market bubble activity

A group of data scientists conducted an in-depth analysis of major innovations and stock market bubbles from 1825 through 2000 and came away with novel takeaways of their own as they found some very distinctive patterns in the occurrence of bubbles over 175 years. The study authors detected bubbles in approximately 73 percent of the innovations they studied, revealing the close relationship between innovation and stock market bubbles. Read more →

UPCOMING ANALYTICS EVENTS

INFORMS-SPONSORED EVENTS

INFORMS Annual Meeting
Nov. 4-7, 2018, Phoenix

Winter Simulation Conference
Dec. 9-12, 2018, Gothenburg, Sweden

OTHER EVENTS

Applied AI & Machine Learning | Comprehensive
Sept. 10-13, 17-20 and 24-25


Advancing the Analytics-Driven Organization
Sept. 17-20, 12-5 p.m. LIVE Online


The Analytics Clinic: Ensemble Models: Worth the Gains?
Sept. 20, 11 a.m.-12:30 p.m.


Predictive Analytics: Failure to Launch Webinar
Oct. 3, 11 a.m.


Advancing the Analytics-Driven Organization
Oct. 1-4, 12 p.m.-5 p.m.


Applied AI & Machine Learning | Comprehensive
Oct. 15-19, Washington, D.C.


Making Data Science Pay
Oct. 29 -30, 12 p.m.-5 p.m.


CAP® EXAM SCHEDULE

CAP® Exam computer-based testing sites are available in 700 locations worldwide. Take the exam close to home and on your schedule:


 
For more information, go to 
https://www.certifiedanalytics.org.