Vlog: Why Data is Healthcare’s Most Valuable Resource

The driving force behind the Walmart/Humana merger, and the spate of other recent innovative mergers, was really about one thing: access to consumer health data.
 
Healthcare’s fight for consumer data is in large part a move to fend off encroaching competition from tech giants like Amazon, which have mastered the art of maximizing customer data. But it’s also part of the broader shift towards value-based care.  



In a Feb. 13 interview with CNBC, BDO’s Dr. David Friend talks more about healthcare’s Amazon threat and why it’s driving innovative mergers.

Healthcare organizations across the entire care continuum are moving towards value over volume—and their financials are increasingly tied to that model. More data means a more accurate look into patient populations, and better enables organizations to lower care costs and improve health services through more personalized care.

Reimbursement tied to data
Certain healthcare organizations are even being required by law to collect performance data on the quality of the care they provide and how technology has helped them provide that care.

Under MACRA (Medicare Access and CHIP Reauthorization Act of 2015)’s Quality Payment Program, Medicare providers can choose to comply via a merit-based incentive payment system track. Under this track (MIPS), Medicare providers still operate under a fee-for-service model. But, they’re subject to performance-based reimbursement adjustments (bonuses or penalties) depending on the data they submit to CMS. The data they submit must show improved quality of care, the effective use of electronic health records, and care coordination across the care continuum. The amount of money they make depends on their data.

The push to value-based care will only quicken. Healthcare organizations—whether they must comply with MACRA or not—will find themselves unable to survive financially if they don’t meaningfully collect and act upon performance and patient data.
 
Innovative partnerships around shared data
Several healthcare entities have started sharing data through value-based partnerships, whereby a drug or device manufacturer is reimbursed only if patients meet certain treatment outcomes.

Novartis only charges for its gene therapy Kymriah if patients go into remission within one month of treatment. Medtronic is moving to more value-based contracts, where the prices of their products are based on how well they work in patients rather than a fixed per-unit cost. And Merck has a value-based agreement with Aetna for Januvia and Janumet, where its rebates on both are based in part on how much the drugs help Aetna’s Type 2 diabetes patients achieve or maintain treatment goals.

Through shared data, disruptive collaborations like CVS/Aetna, Amazon/JPM/Berkshire Hathaway and others have the potential to give consumers even greater visibility into their care options and costs. This could mean more convenient, effective and streamlined care.  

By merging prescription and other medical benefits, these organizations create an opportunity for payers to figure out the real correlation between care and drug prices with clinical outcomes. Rather than paying an arbitrary price per pill, payers under these types of collaborations could instead start paying for drugs based on the clinical results.

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