I D C H e a l t h I n s i g h t s : C o n n e c t e d H e a l t h I T S t r a t e g i e s

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1 Global Headquarters: 5 Speen Street Framingham, MA USA P F I DC MarketScape: U.S. Health I nformation E x c hange Platform Solutions 2012 Vendor Asse ssment I D C H e a l t h I n s i g h t s : C o n n e c t e d H e a l t h I T S t r a t e g i e s VENDOR ASSESSMENT #HI Lynne A. Dunbrack I N T H I S E X C E R P T The content for this excerpt was taken directly from the IDC MarketScape: "IDC MarketScape: U.S. Health Information Exchange Platform Solutions 2012 Vendor Assessment" by Lynne A. Dunbrack (Doc # HI235816). All or parts of the following sections are included in this excerpt: IDC Health Insights Opinion, In This Study, Situation Overview, Future Outlook, and Essential Guidance. Also included is Figure 1. I D C H E A L T H I N S I G H T S O P I N I O N The health information exchange (HIE) market continues to evolve, with the focus shifting from connecting the ecosystem to exchange data and qualify for meaningful use incentives to turning data into "actionable information" that enables emerging accountable care or collaborative care initiatives. Key findings include: To address the business and technical requirements of accountable care, in addition to providing core HIE technologies, vendors are developing, partnering, or acquiring analytics, collaborative care, and patient engagement technologies. Market consolidation among HIE vendors continues. Since Vendor Assessment: Industry Short List for Health Information Exchange Technologies (IDC Health Insights #HI222529, March 2010) was published, seven HIE vendors have been acquired or have merged. New entrants to the market include payers and telecommunication companies. Aetna and Optum have entered the HIE technology market through their acquisitions of Medicity Inc. and Axolotl Corp., respectively. In addition, Medecision, which acquired Hx Technologies Inc. in 2009, is owned by Health Care Service Corp. AT&T and Verizon partnered with technology vendors to launch their respective HIE solutions in 2011 and 2010, respectively. July 2012, IDC Health Insights #HI235816e IDC Health Insights: Connected Health IT Strategies: Vendor Assessment

2 Platform as a service will increasingly play an important role in delivering HIE capabilities. The IT requirements for health information organizations (HIOs) and evolving care delivery and reimbursement models are too extensive for any one vendor to satisfy. Thus creating an ecosystem of strategic partnerships will be critical moving forward. I N T H I S S T U D Y This IDC MarketScape provides an evaluation of 16 vendors that provide HIE platform solutions. Vendors were selected on the basis of estimated market share and potential for growth. The IDC MarketScape vendor assessments for HIE technology are not all inclusive as there are other vendors that provide either a packaged or platform solution for HIE. Additional HIE vendors are covered in IDC MarketScape: U.S. Health Information Exchange Packaged Solutions 2012 Vendor Assessment (IDC Health Insights #HI235830, July 2012), which covers 10 vendors that offer a packaged solution for HIE. See the Appendix section of this report for a listing of packaged solutions covered in that report. There are 4 vendors that are covered in both reports because they provide both a packaged and a platform solution. In all, 22 vendors were evaluated for HIE technologies. P l a t f o r m S o l u t i o n s D e f i n e d The term platform has been overused, and unfortunately with little technical precision, by product marketing teams to make their products sound more robust. IDC Health Insights defines a platform as having the following elements: Development tools, including software development kits (SDKs) that enable customers and partners to develop new capabilities on their own on top of the platform to meet current and future requirements Published, upward-compatible application programming interfaces (APIs) that support bidirectional data flows and user workflow Education for technical staff, in addition to providing end-user training, that enables them to be more self-sufficient in further developing and maintaining the solution #HI235816e 2012 IDC Health Insights

3 Broad ecosystem of partners, such as independent software vendors (ISVs), systems integrators (SIs), channel partners, and resellers, that extend the platform's reach from both a functional and a market penetration perspective Professional services to support the needs of the ecosystem, including support for customers and partners customizing the solution Platforms evolve over time to meet the needs of customers and partners in the ecosystem, often through self-development. In contrast, packaged solutions are designed to meet a very specific set of requirements. They typically consist of preconfigured, modular software bundled with well-defined implementation, training, and support services. Packaged solutions can be extended through Web services and APIs but lack SDKs. The primary objective of packaged solutions is to reduce the risk of uncertainty related to project scope, timelines, and costs. To be clear, there are advantages and disadvantages associated with packaged and platform solutions. The definitions are not meant to imply that one approach is "better" than another. IT buyers should carefully assess their unique business, technical, and clinical requirements to determine which approach is appropriate for their given situation. M e t h o d o l o g y IDC MarketScape criteria selection, weightings, and vendor scores represent well-researched IDC judgment about the market and specific vendors. IDC analysts tailor the range of standard characteristics by which vendors are measured through structured discussions, surveys, and interviews with market leaders, participants, and end users. Market weightings are based on user interviews, buyer surveys, and the input of a review board of IDC experts in each market. IDC analysts base individual vendor scores and, ultimately, vendor positions on the IDC MarketScape, detailed surveys and interviews with the vendors, publicly available information, and end-user experiences in an effort to provide an accurate and consistent assessment of each vendor's characteristics, behavior, and capability. The sources of information for this report include: Vendor briefings. Vendor briefings took place with the vendors that have products featured in this report. Customer references. Interviews were held with customers of the products covered in the report, including both those references provided by the vendors and other customer references known to 2012 IDC Health Insights #HI235816e Page 1

4 IDC Health Insights. At least two detailed, 45-minute reference conversations were held for each product covered. Secondary research. Secondary research for the report included vendor, user, and product Web sites and blogs as well as existing IDC Health Insights research covering this market and these products. S I T U A T I O N O V E R V I E W H I E D r i v e r s a n d B a r r i e r s Health information organizations have evolved from early regional health information organizations of the mid-2000s that were primarily grant-funded pilot projects to HIOs focused on connecting the enterprise and extended community of medical trading partners to meet meaningful use requirements and lay the groundwork for valuebased healthcare. Drivers for HIE include: Provide clinician access to comprehensive health information. Greater access to patient health information provides clinicians a holistic view of their patients and enables clinicians to make more informed clinical decisions at the point of care. Improve patient care and safety. Clinical gaps in care alerts against evidence-based guidelines and protocols help clinicians better manage patients with chronic conditions and provide preventive healthcare services to all patients. Access to health information recorded by other clinicians, such as allergies and medication history, helps reduce potential adverse drug events. Enhance care team collaboration. The secure exchange of health information among care team members improves care team collaboration and leads to more coordinated transitions in care. Reduce healthcare costs. Improved patient safety; reduction of redundant, clinically unnecessary treatments; lower rates of readmissions; and improved patient outcomes will ultimately lead to lower healthcare costs. Qualify for meaningful use incentive payments. Stage 2 steps up the requirements for HIE. In Stage 1, providers only needed to show that they were capable of submitting health information to immunization registries and public health agencies and could use test data to do so. Stage 2 requires data submissions to external entities on an ongoing basis (e.g., summary care records, immunizations, lab results, syndromic surveillance, patient information at the patient's discretion and, potentially, medical images). In addition, 10% of summary care records must be sent to Page 2 #HI235816e 2012 IDC Health Insights

5 unaffiliated eligible providers (EPs), eligible hospitals (EHs), or critical access hospitals (CAHs) using a different EHR system. Lay the groundwork for value-based healthcare. Once health information is available electronically, it can be aggregated and normalized to become semantically interoperable and analyzed. Robust business intelligence and analytic tools to measure quality and outcomes against industry benchmarks will provide the foundation for population health, care, and disease management initiatives and identify clinical best practices across the entire delivery network. By combining clinical and financial health information, HIOs can measure and monitor clinical, operational, and financial performance of its accountable care or value-based healthcare initiatives. Despite more widespread adoption of EHRs and the intense need to exchange health information to meet the "triple aim" of health reform improve population health, reduce costs, and improve the patient experience there are challenges that impede progress: Complex set of technologies. HIE technology is not a single application but instead a set of technologies consisting of a presentation layer, patient/provider identification, data aggregation, data integration and exchange, information management, identity access management, and development framework and extensions. (See the Solution Components section in the Learn More section for a more detailed description of the key components that make up the HIE technology stack.) HIE vendors that cannot provide the full technology stack have established strategic technology partnerships to provide a best-of-breed solution. Cost. A challenging economic environment and competing IT initiatives continue to constrain IT budgets. To reduce the total cost of ownership, HIE vendors are increasingly offering their solutions on a hosted and/or SaaS basis, leveraging cloud economics. Privacy and security. As more patient information is moved into EHRs and made accessible both inside and outside the organization via health information exchanges and a range of devices, including mobile devices, the risk of a privacy breach rises. Under ARRA, privacy breach notification, minimum use, and disclosure reporting requirements become more stringent, and the total annual penalties for violations can increase to $1.5 million. HIOs that cross state lines must be able to meet each state's privacy laws, which could require the ability to support both opt-in and opt-out consent based on where the patient lives and/or where the care is delivered. Consequently, the privacy and security model for HIE technology should be carefully evaluated IDC Health Insights #HI235816e Page 3

6 HIO sustainability (or lack thereof). Over the years, there have been many notable failures of HIOs that could not survive after the grant money ran out. Establishing the right revenue model for the HIO requires a careful evaluation of how stakeholders will derive value from participating in the HIO as well as what data they want to consume, what they will be willing to contribute, and what they will be willing to pay for. Flexible vendor pricing and delivery models will enable HIOs to incrementally roll out functionality to demonstrate value early to attract more HIO participants and add value-added services beyond the core exchange of health information. F U T U R E O U T L O O K The IDC Health Insights vendor assessment for platform solutions for the HIE technology market represents IDC's opinion on which vendors are well positioned today through current capabilities and which are best positioned to gain market share over the next few years. Positioning in the upper right of the grid indicates that vendors are well positioned to gain market share. For the purposes of discussion, IDC Health Insights divided potential key strategy measures for success into two primary categories: capabilities and strategies. Positioning on the y-axis reflects the vendor's current capabilities and menu of services and how well aligned it is to customer needs. The capabilities category focuses on the capabilities of the company and product today, here and now. Under this category, IDC Health Insights analysts look at how well a vendor is building/delivering capabilities that enable it to execute its chosen strategy in the market. Positioning on the x-axis or strategies axis indicates how well the vendor's future strategy aligns with what customers will require in one to four years. The strategies category focuses on high-level strategic decisions and underlying assumptions about offerings, customer segments, business, and go-to-market plans for the future, in this case defined as the next one to four years. Under this category, analysts look at whether or not a supplier's strategies in various areas are aligned with customer requirements (and spending) over a defined future time period. Figure 1 shows each vendor's position in the vendor assessment chart. Its market share is indicated by the size of the bubble, and a (+), (-), or () icon indicates whether or not the vendor is growing faster than, slower than, or even with, respectively, overall market growth. Page 4 #HI235816e 2012 IDC Health Insights

7 F I G U R E 1 I D C M a r k e t S c a p e : U. S. H e a l t h I n f o r m a t i o n E x c h a n g e P l a t f o r m S o l u t i o n s V e n d o r A s s e s s m e n t Source: IDC Health Insights, 2012 V e n d o r S u m m a r y A n a l y s i s InterSystems InterSystems is a privately held software company that serves the healthcare, financial services, telecom, retail, and manufacturing industries, among others. Approximately 80% of its revenue is from healthcare. Founded in 1978 and headquartered in Cambridge, Massachusetts, the company reported $385 million in revenue in The high-speed Caché database represents 80% of that revenue. Across the entire product line, which includes Caché, Ensemble integration platform, HealthShare HIE platform, and TrakCare 2012 IDC Health Insights #HI235816e Page 5

8 (inpatient and ambulatory EMRs marketed outside the United States), InterSystems reports having 80,000 healthcare customers. HealthShare supports the following HIE services: composite health record, clinician viewer, patient index, provider directory, terminology engine, consent management, clinical message delivery, and active analytics. Customers can use either HealthShare's clinical viewer or their own portal application to view consolidated patient records. HealthShare's built-in Caché database lets users directly access data in their existing applications. HealthShare leverages InterSystems iknow and DeepSee technologies to unlock all patient information, including unstructured data, and to enable real-time analysis. HealthShare is offered through either a perpetual or a subscription license. InterSystems targets large-scale enterprise (IDN based) and regional and statewide HIEs in the United States. Internationally, InterSystems targets both private and public HIE networks on a national level. Developing strong partnerships with customers and technology vendors is important to InterSystems. The company targets prospects that are well managed and "know what they want to get done and will do it." InterSystems has partnerships with various EMRs. The company also works with system integrators, such as J2, Infinimed, Inland Imaging, Intuitive Technical Solutions, Rapidata, Telus, Lucrum, Cognizant, Orchestrate, Ready Computing, and DS, among others, to help its customers deploy HealthShare and Ensemble. According to InterSystems, the company has 43 HIE customers in 5 countries, including 34 customers in the United States (27 enterprise HIEs, 3 RHIOs, and 4 statewide HIEs in Illinois, Rhode Island, Missouri, and New York). The remainder are located in EMEA, Latin America, and APAC. There are 3 countrywide initiatives in the Netherlands, Sweden, and Denmark and other implementations in the Czech Republic and Australia. Notable customers include three of New York's RHIOs and Rhode Island's statewide HIE. Most recently, HealthShare was selected by New York ehealth Collaborative (NYeC) as the HIE technology foundation for the Statewide Health Information Network of New York (SHIN-NY). The other New York RHIOs are Brooklyn Health Information Exchange (BHIX), Healthcare Information Xchange of New York (HIXNY), and Long Island Patient Information exchange (LIPIX), now called Healthix. Currently, data is being exchanged for approximately one-third of the patients expected to be covered by Healthix. One of HealthShare's largest customers is the Swedish National Patient Overview (NPO), which selected HealthShare to Page 6 #HI235816e 2012 IDC Health Insights

9 create a nationwide electronic health record system covering the country's 82 hospitals serving 9 million Swedes. IDC MarketScape Assessment Based on InterSystems' score in this IDC MarketScape, the company is positioned in the Leader category. A key differentiator is that HealthShare is designed from the ground up using InterSystems technology and is ready to use "out of the box," with little need for internal integration. HealthShare incorporates InterSystems Ensemble, a market-leading integration platform, as well as Caché, a high-performance database engine. Strong analytics capability is provided through a combination of DeepSee for active analytics and iknow for searching unstructured data. Customers consistently praise InterSystems' experienced development and support staff. HIOs wanting to form strong partnerships with their HIE vendor should consider InterSystems. Strong customer partnerships are important to InterSystems, and customers rate InterSystems highly on its flexibility. E S S E N T I A L G U I D A N C E A c t i o n s t o C o n s i d e r Before beginning the vendor selection process, the HIO should define the problem it's trying to solve and be able to clearly articulate it first to stakeholders and then vendors during the search process. This process will help identify the type of solution desired, thus narrowing the list of vendors for evaluation to a manageable number and allowing a more "apples to apples" comparison of potential solutions. Use this IDC MarketScape to compare vendor offerings. When evaluating HIE solutions, healthcare organizations should consider the following: What is the origin of the vendor's solution? Despite recent mergers and acquisitions, the HIE market remains fragmented and includes vendors that have entered the market from widely disparate origins. Many HIE solutions have evolved from the expansion of functionality of products that were originally targeted at related business functions, such as interfacing internal applications, workflow management, secure messaging, or Web portal development. Understanding a vendor's origin can help guide product evaluation and inform expectations regarding product strengths and potential gaps to be filled in IDC Health Insights #HI235816e Page 7

10 Does the HIO want a development platform or a turnkey solution? HIOs with limited internal IT resources or a need to deploy quickly should consider turnkey packaged solutions. HIOs that have unique, complex environments; their own methodology for technology implementation; and IT resources for deployment and internal development should consider vendors that provide infrastructure or platform solutions that enable them to customize their own HIE solution. How important is a vendor-neutral solution? EMR vendors are also beginning to offer their own HIE solution through partnerships, acquisition, or internal development. If there is a dominant EMR vendor in the medical trading area, then using that vendor's HIE solution may help establish connectivity to its customers quickly. However, HIOs should recognize that one of the more challenging aspects of HIE is to get competing EMR vendors to work together to exchange data between their systems. As such, they should develop service-level agreements that hold vendors accountable for any lack of collaboration that delays or impedes deployment of the HIE. Can the vendor and its HIE solution enhance "speed to value"? The ability to leverage existing systems and accelerate implementation time frames is the fastest path to HITECH incentives. What experience does the vendor have in working with the EHR solutions used by the HIO's medical trading partners? How flexible is the architecture? Flexibility is critical to meet the ever-changing regulatory requirements that will ultimately transform how healthcare organizations deliver care and are paid for those services, impacting business, clinical, and technical requirements for health information exchange. SOA-based architecture provides technical flexibility that enables vendors and their customers to respond to new requirements whether they are imposed to meet new business objectives, standards, or regulatory mandates. Will the data be centralized or federated, or will a hybrid approach be utilized? The advantages and disadvantages of each model are discussed in the Solution Architecture section in the Learn More section. HIOs should evaluate the willingness of stakeholders to share data and how much sharing will be tolerated to determine the appropriate strategy. In some cases, HIOs might find it easier to start with a federated approach to get a proof of concept up and running quickly to demonstrate value to stakeholders but then will want to centralize data in order to provide clinical decision support and population health management services. These HIOs should seek vendors that support multiple approaches and query them about what it takes to migrate from one strategy to another. Page 8 #HI235816e 2012 IDC Health Insights

11 If data is to be aggregated, how will it be aggregated and how will it be used? Aggregation strategies vary from storing documents to discrete data that can be acted upon. The ability to aggregate data and apply a variety of clinical and business intelligence, analytics, and decision support tools will be essential for managing the healthcare organization's performance under new value-based reimbursement models. Can the vendor provide a comprehensive end-to-end solution? Vendors assemble end-to-end solutions through a combination of internal development, strategic partnerships, and product or company acquisitions. It is important to understand how well these components are integrated, especially if the assets are owned and managed by separate companies. How strong are the vendor's strategic partnerships? Look for vendors with a track record for establishing and maintaining strong partnerships with other technology vendors few, if any, vendors can provide all the required components. What pre- and post-implementation support is available? The measure of success is determined by the number of users actively using the system and transaction volumes, not simply the number of registered users. HIOs should ask the vendors they are evaluating what type of support is available to market the HIE solution to clinicians, provide engaging training, monitor ongoing utilization, and address any barriers to adoption (e.g., provide additional training because of turnover in the office). HIOs should follow best practices for system selection including conducting thorough due diligence. Talk to customers that resemble the HIO and have similar business needs. Can the vendor support not only current needs but future business, clinical, and technical requirements? What is on the vendor's product road map, and how does that match up to the HIO's evolving needs? Obtain SLAs; does the vendor have the appropriate staffing (employed or contracted) to support the implementation and post-implementation phases? If the HIO is contemplating or has an accountable care initiative under way, what is the vendor's experience working with ACOs? Last, remember successful HIE initiatives begin and end with strong partnerships between the HIE and its stakeholders, between the HIE and technology vendor(s), and between the technology vendor and its strategic partners. Open lines of communications and managing expectations will go a long way to ensuring that the HIE's objectives are not only met but even exceeded IDC Health Insights #HI235816e Page 9

12 S y n o p s i s This IDC Health Insights report provides an evaluation of 16 vendors that provide a platform solution for HIE. The vendors we chose to cover include leaders in the industry that were chosen for their market share and penetration or their potential growth opportunities. Additional HIE vendors are covered in IDC MarketScape: U.S. Health Information Exchange Packaged Solutions 2012 Vendor Assessment (IDC Health Insights, #HI235830, July 2012), which covers 10 vendors that offer a packaged solution for HIE. "New care delivery and reimbursement models will require flexible IT solutions that can address current and future technical, business and clinical requirements," states Lynne A. Dunbrack, program director, Connected Health IT Strategies. Platform solutions for HIE provide the tools to enable HIOs and ecosystem partners to build out new functionality to meet their constantly evolving needs. C o p y r i g h t N o t i c e Copyright 2012 IDC Health Insights. Reproduction without written permission is completely forbidden. External Publication of IDC Health Insights Information and Data: Any IDC Health Insights information that is to be used in advertising, press releases, or promotional materials requires prior written approval from the appropriate IDC Health Insights Vice President. A draft of the proposed document should accompany any such request. IDC Health Insights reserves the right to deny approval of external usage for any reason. Page 10 #HI235816e 2012 IDC Health Insights