health it summit miami 2015 - keynote presentation "creating competitive advantage through...

Creating Competitive Advantage Using Analytics

Jon Scholl, Chief Strategy Officer at Texas Health Resources

February 11, 2015

Texas Health Resources – Who we are

• Our Mission: “To improve the health of the people in the communities we serve”

• THR is one of the largest faith-based, nonprofit health systems in the US

− 21K employees

− 25 acute care, transitional, rehab and short-stay hospitals that are owned,

joint-ventured or affiliated

• 17 acute-care hospitals

• 6 short-stay hospitals

− 3,800 licensed hospital beds

− 59 outpatient facilities, surgery centers,

fitness centers, and imaging centers

− More 250 other community access points

− $3.7 billion in operating revenue (FY 2012)

2/17/2015 2 Confidential And Proprietary – All Rights Reserved – For Internal Use Only

Texas Health Resources

** Physicians on the medical staff practice independently and are not employees or agents of the hospital or Texas Health Resources.

• Texas Health Physicians Group with

560 physicians and more than 240

advanced practitioners

Target Video



Guest ID predictive analytics

− Useful patterns in buying

behavior emerge

− Pregnancy prediction score

− Target sends timed

coupons relevant to each

stage of pregnancy

• Target determines

customer’s potential to

spend, markets to identified

customers

Are you pregnant? If so, Target knows!

4 Confidential And Proprietary – All Rights Reserved – For Internal Use Only


2/11/2015

Source: Andrew Pole, Target Analytics

Caesars Entertainment “Total Gold” loyalty program



2/11/2015

“We know if you like golf ... chardonnay, down pillows, if

you like your room close to the elevator, which properties

you visit, what games you play and which offers you

redeemed….We not only use these things on the front end

of marketing but for the service experience”

24% increase in spending from loyal customers,

82% of revenue base

Marriott International : micro-segmenting the

demand curve

“One Yield” revenue management

system

− Frequent pricing adjustments to

account for changing conditions

− Predictive models to maximize yield

− Extended to catering, restaurants and

meeting space

• Marriott Rewards micro-segments

most profitable customers and targets

offers



Source: Competing on Analytics,

HBR, 2006

$86M in increased profits

Basis for Competitive Advantage

• Since the 1950s, volatility in operating margins (historically stable), has more

than doubled

• More than 40% of GDP comes from companies where the industry market share

is considered volatile and highly unpredictable

• 1960s Portfolio Theory (growth/share) is evaporating as share position and

market power are becoming less linked

− BCG calculated that the probability that market share leader = profit leader is

less than 7 percent, down from 34 percent in the 1950s

• The historical frameworks for strategic advantage are under fire

− Scale and position can be fleeting

− Industry borders are becoming less defined, more fluid

− Forecasting is unreliable

− Data rich, information starved

− Rapid change = planning tools are less accurate and less important



Analytics competitors (i)



2/11/2015

Supply Chain Customer selection,

loyalty, and service

Source: Competing on Analytics,

HBR, 2006

Analytics competitors (ii)



2/11/2015 2/11/2015 Source: Competing on Analytics,

HBR, 2006

Human capital Pricing Research and

development

Data analytics as a competitive advantage

• Data analytics has become increasingly important to organizations

looking for a competitive edge

• Rapid advances the use of real-time data has been enabled by

technology

− Additional access points created through online interactions

− Increasing adoption of large customer-centric data warehouses

− Healthcare: transition to Electronic Health Records has enabled

searchable real-time clinical data



Source: Accenture survey of 600 Executive Leaders 2013

Aggressively using

analytics

33% Senior management

engaged with analytics

68% Have senior figure such

as a “Chief Data Officer”

2/3

Industry interest in data analytics was

jumpstarted in 2007



"Make analytics part of your

overarching competitive

strategy, and push it down to

decision makers at every

level. You'll arm your

employees...for making the

best decisions - big and small,

every day“

- Thomas Davenport, 2007

Health Care: Investments in predictive funding

increased 5X in 3 years



$902M

$520M

$300M

$201M

2011 2012 2013

5X

2014

Predicting Funding

Venture funding for companies using predictive analytics (2011-Q3 2014)

Source: RockHealth

Go Big…..or Go Little?

DATA DATA



2/11/2015

Collecting unique data

about the customer, the

vendor, the location, and

interactions

Collecting giant stream of

digital metadata to mine

common behavior

patterns

BIG Little

Electronic Health Predictive (e-HPA) Analysis can

be used to predict future clinical events

Through analysis we can…

2/11/2015 Confidential And Proprietary – All Rights Reserved – For Internal Use Only


14

Stratify patients according to risk level

Allocate scarce clinical resources

Prevent adverse or harmful events

1

2

3

From admission to 90 days post discharge; six

activities reduce readmissions



Post 90 Days

Identify HF

Patients

Risk Stratify

& Rank

Notify Team

Discharge

Plan

Monitoring

& IP/OP

interventions

Ongoing

Analysis

Admission

1 3 5

2 4 6

Discharge

How the patient is identified as a risk:

Natural Language Processing

“68 yo WF presents with acute on chronic non

ischemic systolic and diastolic chf, severely

depressed ef and grade ii diastolic dysfunction.”



16

Notes from EMR:

Natural Language Processing Interpretation



Disease/ Symptom Time Attribute

Acute Heart Failure current and

primary

• Systolic, significant depression in

ejection fraction;

• Diastolic dysfunction, grade 2

• Non-ischemic

Chronic Heart

Failure

historic

Software

Interpretation:

Outcomes



18

8.5%

Readmissions Spend $1

$4.59

Pieces™ gives THR a measureable benefit Feedback from clinicians and case management

• “Pieces real-time risk scoring allows us to be notified of cases

earlier.”

• “Task management is simplified with integration in Epic system

list and order sets.”

• “Appreciate ability to enroll medium risk patients.”

• “No need for separate manual process.”

• “Pieces identification of heart failure patients was accurate.”



Cost goes down when well-being goes up

2/11/2015 21

Confidential And Proprietary – All Rights Reserved – For Internal Use Only


1 % Well-Being

2.2% likelihood of hospital admission

1.7% likelihood of ER visit

1.0% likelihood of incurring healthcare costs

Source: “Evaluation of the Relationship Between Individual Well-Being and Future Health Care Utilization and Cost”

Population Health Management, Volume 15, Number 00 2012. Patricia L. Harrison, MPH, James E. Pope, MD, Carter R.

Coberley, PhD, and Elizabeth Y. Rula, PhD

Fortune 50 case study: Results

3/26/2013 22



Individual Well-Being Score

% o

f E

mp

loy

ees

2011: Average 71.0

2012: Average 73.9

(std dev = 13.4)

(std dev = 13.6)

Δ= 2.9 *

Well-Being Improved Significantly in Matched Respondents

T1-T2 Matched Cohort, N = 780

*Paired sample t-test, p < 0.05

Translating odds to probability of business

impact

3/26/2013 23



ER Visit Next 12 Months Turnover Intention 1+ Absence / Month

Being Rated a

“High Performer”

Based on the odds,

the chance of…

Well-being Segment

Fortune 50 Case Study

Probability of occurrence

The dark green shows where WB5 scores are

high; light green represents low scores



We will target assets and

physicians to populations

and geographies

Incorporate data into

predictive risk analysis

Incorporate data in employer

wellness offerings

Analytics has proved to be a powerful tool in the

commercial industry; now applies to healthcare



Advances in technology have made

it possible for us to utilize analytics

in Healthcare

Well-Being Inpatient

events

What’s next for healthcare….



2/11/2015

We have invested in EMR systems …so we have

data…what should we do with it?

IT

Infrastructure

& Integration

Interpreters of

data

Organizational

Commitment

1 2 3

EMR Systems

1

Investment Needed Done

Healthcare is ripe for analytics competitors;

current organizations will have to invest

• Strategic guidance (“what do

we want to know?”)

− pmpm population health

reports

− Network quality and

utilization

• Walk, then run



2/11/2015

Organize for success… …and keep an eye on the future

Summary

• The pace and change of Healthcare is unprecedented

• What will be the new source of competitive advantage in this industry?

− Power and influence or deep understanding of the analytics of the industry?

• Of all industries, Healthcare is ripe for analytic-competitors

• Requires key elements to succeed

− Organizing for success

− Strategic guidance (“what do we want to know?”)

• pmpm population health reports

• Network quality and utilization

• Etc

− Walk, then run



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