20 Mar WILL IBM SAVE THE US MIDDLE CLASS?
When I read the news of IBM’s acquisition of Truven Analytics last week I had to contain my excitement. From my perspective, it is ground shaking to imagine the potency of IBM Watson Health gaining access to a significant cache of private and public healthcare data. Let me explain.
The middle class in America has been under significant economic pressure from the impact of healthcare costs for years. For well over a decade the significant gap between increases in income and increases in health care expenditures continues to widen. This is particularly important for those making less than $75K annually, where every dollar of disposable income impacts the quality of life. In addition, it is commonly reported that medical bills are the #1 cause of bankruptcies, with a disproportional impact on the middle and lower classes.
Adding to this is the shift toward consumerism with strategies like high deductible plans, which increase the proportion of health care cost burdens on the individual. Consequences include higher individual costs and lower compliance with prescribed medications and interaction with the healthcare system. These current circumstances are thus aggravating the problem pointed out by the Institute of Medicine in its landmark 2004 Crossing the Chasm report which concluded “we know what to do (medically), but are not doing what we know.” This too targets those with the lowest ability to absorb the increased expense – the middle and lower classes.
These lower adherence rates notably affect primary (lifestyle & immunizations), secondary (pre-disease), and tertiary (disease) prevention efforts, where “doing what we know” has the potential to decrease the development, progression, and complications of disease, thereby saving billions of dollars, pain and suffering. Successfully accomplishing this would save individuals from needless cost, disease, disability and death – adding to the prosperity and productivity of the middle class.
So what does this have to do with IBM? With the acquisition of Truven, coupled with the insight Watson Health can provide IBM in predictive analytics, and the addition of Phytel (more below), IBM can literally transform healthcare in America from the antiquated, dangerous, fragmented “system” we have now to the proactive, effective, life-enhancing, possibility. Seem impossible? Here’s how they’ll do it.
When IBM loads the Truven database into Watson, the world of “Watson Age” of predictive analytics will continue to evolve. The relatively primitive use of “gaps in care” and the actuarial models that predominate today will be replaced by the ability to predict events and health changes not possible in the past. Made available to individuals or groups of individuals, say a corporation, Medicaid, or Medicare recipients, informed individuals with the knowledge and confidence to choose, can reduce unnecessary conditions, cost, pain & suffering, disability, and death over a relatively short time (months to years).
If programs and systems were designed and taken to individuals in apps and programs; and if the incentives in health plan benefit design, whether government or private, were created to support individuals successfully achieving these recommendations, then the US Healthcare system could pivot from the most expensive, and one of the less effective systems to the highest value system in a matter of years. This would save literally billions of dollars in unnecessary care, unintended consequences of the care provided, and the provision of important care that remains undone in America today – a huge benefit to all Americans, and to the middle class particularly.
In addition, the ability to look at individual doctors, integrated delivery systems (IDNs), and accountable care organizations (ACO’s) with statistical power and new insights will be unparalleled in history. Why is this so important?
Imagine for a moment that every doctor, IDN, and ACO had insight into their value to the system along the lines of quality, safety and cost. While this initially may be disconcerting to the average doctor or health system, done properly, this information would be used to improve individual and organizational effectiveness, and potentially over time, to weed out those providers who are unwilling to meet acceptable benchmarks. A necessary change to the #3 cause of death: the US healthcare system.
Over time these analyses would be made public to individuals who would then have the ability to factor in quality, cost, service, and safety into their healthcare decisions, finally making transparency a reality that empowers the individual healthcare consumer.
Also, don’t underestimate the power of the demographics embedded in the Truven database. The ability to analyze and predict who will be compliant and adherent to healthcare recommendations, and to generate hypotheses and research to improve engagement and activation are also important. Patient/employee engagement has been characterized as the “next billion dollar drug” and this lays the foundation for IBM to raise the stakes and effectiveness in this vital area.
IBM’s acquisition of Phytel a few months ago plays directly into this strategy with its proven effectiveness in providing individuals and providers with important information to improve and proactively manage their health, providing another crucial link in the chain of critical steps to transform healthcare.
From my perspective IBM’s strategy will work. As a primary care doctor who struggled with proactive healthcare, I have seen the power of effective analytics when working with Jim May of Clinical Integration of North America (CINA); of effective outreach while working with Neil Smiley the founder of Phytel; linked to effective implementation in a primary care practice serving patients in north Texas (TienaHealth). This was early in the 21st Century so it took a few years to design, but the resulting increase in effectiveness, efficiency, and patient satisfaction, the Triple Aim, were inspiring.
While this vision might sound naive or optimistic, it is possible. The combination of Truven’s data and Watson’s insights creates the possibility of a new future that could result in an infusion of billions of dollars of discretionary income into the middle class. While not solving the problem of job creation, education, healthier communities, and the other challenges facing the middle class today, it certainly would be a huge step in the right direction.