IDC MARKETSCAPE IDC MarketScape: U.S. Population Health Management 2014 Vendor Assessment Cynthia Burghard THIS IDC MARKETSCAPE EXCERPT FEATURES: WELLCENTIVE IDC MARKETSCAPE FIGURE FIGURE 1 IDC MarketScape U.S. Population Health Management Vendor Assessment Source: IDC Health Insights, 2014 April 2014, IDC Health Insights #HI247880e
Please see the Appendix for detailed methodology, market definition, and scoring criteria. IN THIS EXCERPT The content for this excerpt was taken directly from IDC MarketScape: U.S. Population Health Management 2014 Vendor Assessment (Doc # HI247880). All or parts of the following sections are included in this excerpt: IDC Opinion, IDC MarketScape Vendor Inclusion Criteria, Essential Guidance, Vendor Summary Profile, Appendix and Learn More. Also included is Figure 1. IDC OPINION Market dynamics have driven the emergence of the population health management market. As the buzzword du jour, population health management is defined differently depending on with whom you are speaking. One of the drivers to create an IDC MarketScape for U.S. population health management is to establish a common definition and vendor inclusion criteria to provide clarity to healthcare executives before investing in technology. Key findings of this IDC MarketScape include: Population health management as defined by IDC Health Insights includes functionality to identify populations at risk or predicted to be at future risk, the ability to create and monitor care plans and, finally, the ability to communicate with communities of patients as well as with individual patients. While population health management is an emerging market, it is also a very active market with a number of vendors reporting sales at 10 to 15+ new clients in 2013. Physician group practices represent the majority of clients in the population health management market, with integrated delivery systems and payers representing a smaller share of the market. Differentiators include the depth and breadth of analytic capability (patient risk identification and performance measurement), the degree of integration with electronic health records (EHRs), and the sophistication of care plan development. The ability to have data-driven but configurable care paths is an efficient way to begin the care planning process. While a few leaders are identified, the population health management market demands are so dynamic that we will likely see new entrants. With the exclusion of just two vendors, the rest of the vendors are owned by companies with multiple healthcare applications or horizontal technology suppliers. As a result, consolidation of the market is likely to be slow. IDC MARKETSCAPE VENDOR INCLUSION CRITERIA IDC Health Insights' analysts did a comprehensive review of vendors claiming to have a population health management solution. At both HIMSS 2013 and HIMSS 2014, population health management 2014 IDC Health Insights #HI247880e 2
was a popular signage. The types of vendors that identified with population health management included those selling electronic health records, core provider health information systems vendors, and analytics vendors. While many of these vendors had some capability to enable population health, they did not meet IDC Health Insights' vendor inclusion criteria, which include: Functionality that includes analytics to identify and stratify patients and present performance measurement data to providers as well as workflow to develop interventions at the patient and campaign level and tools to engage patients in their care plans and progress toward goals. Referenceable clients that are using all the functionality defined in the first bullet either on a single platform or through integration. A number of vendors had the functionality within their product assets but it was not being used together to enable patient health management. We call these "vendors to watch" (see the Vendors to Watch section in the Appendix). Technology must be installed in healthcare providers, either hospital or physician group practice. A number of vendors are selling their population health management assets to payers that are in turn providing the capability to their providers. Vendors included in this IDC MarketScape include: Covisint eclinicalworks Explorys Kryptiq Lumeris McKesson Medecision Optum The Advisory Board Company Wellcentive ESSENTIAL BUYER GUIDANCE The population health management market is among the most confusing to buyers. Because it is the term du jour, virtually all vendors are interested in being recognized as providing technology to enable population health management. This document not only defines the market but identifies 10 vendors that are actively supporting this market. While other vendors may support some of the population health management requirements, they do not provide the full functionality. It is critical that buyers articulate their business goals before they select a vendor. Vendors in this IDC MarketScape have strength in different aspects of population health, and it is critical for buyers to align themselves with the vendors that will meet their requirements. Other guidance for buyers includes: Clearly articulate, quantify, and document your organization's business goals and assess the organization's ability to take on population health. These two exercises will provide the criteria 2014 IDC Health Insights #HI247880e 3
with which you select your vendor. For example, an organization that is new to population health will need consulting support to help create the processes, people, and other resources required to enable population health. In this case, the organization will want to select a vendor that has a full breadth of resources to support the transition. Remember that a vendor's strength is typically in its heritage. If your organization does not have a strong analytics capability, you may want to look at vendors that do not have their roots in analytics. Keep in mind that the decision on a vendor is as much a business decision as an IT decision. Increasingly, IT procurement decisions and funding are coming from the line of business. This trend is expected to continue. Population health management combines payer and provider domain expertise; make sure your vendor has both capabilities. Most vendors in the population health market have brought together both payer and provider resources to support product development and consulting. VENDOR SUMMARY PROFILES This section briefly explains IDC's key observations resulting in a vendor's position in the IDC MarketScape. While every vendor is evaluated against each of the criteria outlined in the Appendix, the description here provides a summary of a vendor's strengths and challenges. Wellcentive Since 2005, Wellcentive has delivered physician-facing population health management and data analytic solutions to improve clinical and financial outcomes. Wellcentive is privately owned and funded through venture investment. Wellcentive has raised a total of $6.4 million in outside funding; the last round was for $2.25 million in July 2013. Wellcentive's clients include health systems, hospitals, physician practices, accountable care organizations, independent physician associations, employer groups, self-insured employers, and payers. The majority of its clients are physician practices. Wellcentive reports a large client base of over 1,100 clients; about two-thirds of these are small practices and sales to these are through a channel partner, while the remaining one-third are medium-sized to large provider practices and Wellcentive sells directly to them. Wellcentive's cloud-based, scalable, and customizable Advance solution enables population health management and is the product that is evaluated in this IDC MarketScape. Wellcentive is a Leader in this population health management IDC MarketScape. Strengths Wellcentive has a large and diverse client base and as such has developed over 2,500+ live interfaces. Wellcentive has brand recognition in the population health market. The recently announced partnership with TriZetto will provide a sales channel into the payer market as TriZetto has perhaps the largest footprint in the payer market. Wellcentive appears to have one of the shortest implementation time frames in this market. To have as many clients through a channel partner and be able to scale down the product and its price, Wellcentive has a flexible pricing model. 2014 IDC Health Insights #HI247880e 4
In the past 6 months, Wellcentive has clearly articulated through rigorous research its most productive markets, which now extend to payers through its relationship with TriZetto. In addition, Wellcentive has developed a strong road map for the next 18 to 24 months that includes a unified quality program, services to support transformation to new value-based programs, and a connected community where its clients can share content and processes as well as share experiences. Extensive investments have been made to build a strong services offering that includes implementation and training, consulting to assist clients implement and or refine their patient-centered medical home as well as help design quality programs and, finally, operations services including program monitoring and interface management. Challenges With limited experience in the payer market, Wellcentive can close that gap through its relationship with TriZetto. Wellcentive's approach to population health management is rich in the use of industry standard reporting requirements. This allows the company to identify gaps in care and identify quality issues. Wellcentive has not articulated a strategy to bidirectionally integrate with electronic health records; a strategy to provide information to physicians as part of their workflow will provide opportunities to close gaps in care as well as reinforce care plans. Wellcentive relies on external investment to fund its development. APPENDIX Reading an IDC MarketScape Graph For the purposes of this analysis, IDC divided potential key 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 the vendor is to customer needs. The capabilities category focuses on the capabilities of the company and product today, here and now. Under this category, IDC analysts will 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 three to five years. The strategies category focuses on high-level decisions and underlying assumptions about offerings, customer segments, and business and go-tomarket plans for the next three to five years. The size of the circle for each vendor is based on market share. Readers should recognize that counting clients can be misinterpreted. The revenue varies widely based on the number of locations being installed and the complexity of the data and the sophistication of the analytics. IDC MarketScape Methodology 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 2014 IDC Health Insights #HI247880e 5
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, on 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. Market Definition IDC Health Insights defines population health as the people, processes, data, and information technology to improve the health of both individuals and communities. Typically, programs include management of gaps in care, location of care (e.g., emergency room use), and individuals with chronic conditions. This market provides guidance and tools to enable prevention of illness and maintenance of health. Management of care has evolved over the past 20 years. In the late 1980s, payers began requiring authorization of non-emergent inpatient admissions and discharge planning. In the 1990s, technology emerged to automate authorization of inpatient admissions and discharges the result of which was more consistent application of care pathways and more efficiency for the nurse reviewers. Many payers introduced high-cost care management and disease management. Even with the automation of nurse reviewer workflow, disease management still required very intensive work by nurse managers as they did most of their outreach by phone. In early 2000, technology was introduced that would reduce the labor intensity of disease management; while cost effective, the technology-based programs required patients to go to a portal to get instruction or to enter data. Patient adoption of portals has been poor because it requires the patient to go outside of their routine processes and engage in the program. Today, methodologies to prioritize patients and to help determine the best channels to reach out and touch patients are being developed. There are still patients who require personal touch while others are just fine with light technology touch and yet others need a combination of touch points. Advances are being made and incorporated into population health programs and are seen as productive. Strategies and Capabilities Criteria Table 1 provides information about the evaluation and scoring of population health management strategies. Table 2 provides information about the evaluation and scoring of population health management capabilities. 2014 IDC Health Insights #HI247880e 6
Market Dynamics As a result of industry acceptance of the objectives of the Triple Aim developed by the Institute of Healthcare Innovation, the Accountable Care Act, and commercial activity, the industry is in the midst of transformation from volume-based reimbursement to value-based reimbursement. This movement has generated new reimbursement and care delivery models. While early reporting by a number of commercial and federal programs show positive results from programs introduced recently, the "savings" are relatively low-hanging fruit such as emergency room visits. To be sustainable, accountable care programs must begin to improve outcomes through significant patient engagement. Medicare Advantage and Medicaid programs have become very creative in their treatments for patients in care management or care coordination. For example, we know that financial, psychosocial, cultural, and behavioral health all have an impact on an individual's health and disease state. IDC Health Insights calls this extension of benefits The Community of Health. Figure 2 displays the various aspects of a patient's life that impact health and wellness. Specialty programs have done a good job of providing transportation to patients who don't have good access to transportation. Professional cleaning companies are being dispatched to clean dusty and mold-infested homes to reduce asthmatic attacks. Supplier Dynamics The supplier market for population health management includes vendors with various beginnings. Vendors such as Wellcentive. McKesson, Covisint, Kryptiq, and Lumeris came into the market as providers of population health technology. Vendors such as Optum, The Advisory Board Company, and Explorys came into the market as vendors of analytic solutions and built their care management workflow and patient outreach to compete in the population health management market. Medecision came into the market through its acquisition of Cerecons, a population health management technology supplier. eclinicalworks has a large client base in its electronic health record business. IDC Health Insights believes that a vendor's strength is with its initial offering. That being said, there are also benefits and strengths based on heritage. For example, with eclinicalworks' extensive knowledge of physician workflow the company provides great insights into how to integrate its population health management data into the providers' workflow. With Optum One, Optum has brought to market the strength of its analytic solution (formerly known as Humedica) as well as the strength of its CareSuite application on an integrated platform. Most vendors in this market have relatively small client bases; on the high end, vendors have about 60+ clients and on the small end in the mid-teens. The applications by and large have relatively short installation times in the 90- to 180-day range. The duration of installation is often based on the number of data sources and the complexity of the provider network. The population health management market is different from other markets in healthcare, and the population health management technology suppliers are providing a significant degree of consulting to their clients. Beyond implementation services, the suppliers in this market have dedicated resources to work with clients on governance and staffing, how to use and interpret risk scores to prioritize patients, how to identify target populations and enroll them in programs, and how to monitor results of both engaged patients and providers. IDC Health Insights believes this trend will continue for at least the 2014 IDC Health Insights #HI247880e 7
next 18 to 24 months. As providers become more familiar with population health management requirements and begin to develop best practices, their demand for consulting is likely to be reduced. The bulk of vendors that participated in this IDC MarketScape research are primarily categorized as market players; three vendors are identified as leaders and a number of vendors are very close to being leaders. LEARN MORE Related Research Perspective: Population Health and Accountable Care Sustainability (IDC Health Insights #HI245971, January 2014) U.S. Accountable Care 2014 Top 10 Predictions: Collaboration, Sustainability, and Technology (IDC Health Insights #HI245565, January 2014) Perspective: The Balance of High Touch and High Tech in Patient Engagement (IDC Health Insights #HI243433, October 2013) Business Strategy: Accountable Care Maturity Model (IDC Health Insights #HI240916, May 2013) Synopsis This IDC Health Insights report enables healthcare executives to define the emerging, and often confusing, population health management market. Executives will have a definition of this market, its key strategy and capability requirements, and an evaluation of vendors actively participating in this market. The report will untangle the confusion that exists when defining this market. Vendors report a very active 2013 in terms of new clients, which IDC Health Insights believes will continue for the next 18 to 24 months. In the future, we will see advances in analytics and patient engagement strategies in population health. The industry has realized the critical nature of data in accomplishing the goals of the Triple Aim. "While this is an emerging market, the population health management market vendors are stable with most having been acquired by larger vendors that recognized this as a high-growth market offering critical tools and processes to enable population health management." Cynthia Burghard, research director, Accountable Care IT Strategies 2014 IDC Health Insights #HI247880e 8
About IDC International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications and consumer technology markets. IDC helps IT professionals, business executives, and the investment community make factbased decisions on technology purchases and business strategy. More than 1000 IDC analysts provide global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries worldwide. For more than 48 years, IDC has provided strategic insights to help our clients achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. Global Headquarters 5 Speen Street Framingham, MA 01701 USA 508.935.4445 Twitter: @IDC idc-insights-community.com www.idc.com Copyright Notice Copyright 2014 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.