Some See Large EHR Vendors as Playing Catch-up in Population Health

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healthcare business.

“In our view, population health management is going to have to be the answer to the question of how to curb the drivers of healthcare spending,” Neal Patterson, co-founder, CEO and chairman of Cerner, wrote in the company’s 2016 annual report.

According to the report, Cerner’s population health management product became available in 2013. By the end of last year, the 100-plus Cerner clients using the software had pooled together data on a combined 88 million patients.

Still, there’s no guarantee that large EHR vendors like Cerner and Epic will increase—or, for that matter, maintain—their current market share in population health management software.

For instance, the University of Iowa Health Alliance, which includes multiple hospitals that use or are installing Epic’s software, recently picked a separate vendor to provide tools the alliance will use to manage its accountable care organization (ACO). That’s according to Greg Smith, a consultant for health systems that use Epic’s software, who discussed his experience serving on the alliance’s search committee in a recent call with industry analysts.

(An ACO is a healthcare payment model for Medicare beneficiaries that, like many of the others that have become more popular amid the shift to value-based care, puts more risk on providers and less risk on payers than with fee-for-service models. Similar tools can be used to manage patient populations and ACOs.)

The Iowa organization ended up picking Optum, part of Minnesota-based UnitedHealth Group (NYSE: UNH), to provide software for its ACO. Smith said one reason that the committee chose Optum over competing vendors, such as Arlington, VA-based Evolent Health (NYSE: EVH), was Optum’s good reputation among large payers. Smith said he has been on two other search committees for ACOs, and both also ended up selecting Optum.

“[Healthcare organizations] would like to turn to their software vendors, whether it’s Cerner or Epic,” Smith said. “But neither Cerner or Epic really have their game together in population health yet, so [these organizations] are turning to third parties.”

However, that could change, potentially in just a few years’ time, he said.

While the alliance awarded the contract to Optum, it was “also interested in continuing to work with Epic to make sure that within a period of three to five years that Epic would be in a position to replace Optum,” Smith said. “The reason why the desire [of hospitals] is there to work directly with EHR vendors is really quite simple: all of the clinical data that they’re looking to manage, and all the case management, and all the engagement of the patient population is going to be much easier if it’s in one integrated solution set.”

But in the short term, Smith said providers seeking help managing their ACOs or patients with certain chronic conditions are likely to continue looking to Optum and other companies that are more narrowly focused on population health software.

Last year, the Orem, UT-based market research firm Klas assembled dozens of healthcare leaders for a one-day summit. Part of their mission was to define the “required core competencies” for a population health tool set.

The list of six competencies, which Klas calls “verticals,” are listed in a white paper that’s available on the organization’s website. Each vertical is split into bulleted lists of basic and advanced functionalities.

Not long after the summit, Taylor Davis, vice president of analysis and strategy at Klas, told the trade publication Health Data Management that “no vendor has products that have mature functionality in all six of the verticals.”

Hutchison, of Epic, says that the company’s Healthy Planet application covers the basic … Next Page »

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