Can ubiquitous access to healthcare data help reduce the surging healthcare cost in the US? | HCL Blogs

Can ubiquitous access to healthcare data help reduce the surging healthcare cost in the US?

Can ubiquitous access to healthcare data help reduce the surging healthcare cost in the US?
January 18, 2021

Over the last three centuries, the longevity of human life has made some significant strides. The average life of a human in the 1600s was about 40 years. Compared to this, today’s life expectancy stands at a staggering 75+ years. The advent of medicines, the advancement of surgical interventions, and the improvement of quality of life are major contributors to human longevity. Though these statistics are heartening to know, ubiquitous access to care still remains questionable. Year-on-year, the cost of care is increasing exponentially, making healthcare service a topic of debate at government and political battlegrounds.

According to WHO the worldwide healthcare expense in 2017 is about 7.8 trillion dollars. The world population being about seven billion, the healthcare expense per person on an annual basis comes to about 1,084 USD. Of this, US spends an astounding 3.6 trillion dollars on healthcare. The US population is about 330 million and the average healthcare expense per person is almost 11,000 USD per annum, ten times higher than an average person’s healthcare expense in the world.

Healthcare service represented 17.3% of the U.S. Gross Domestic Product (GDP) in 2018. It was 8.8% in 1980 and 11.9% in 1990. At this rate, healthcare will be 25% of the U.S. GDP by 2025. Health care costs are growing faster than the nation's overall economy and personal income.

So, what can we do to reduce this ever-rising cost of healthcare service? As complex as this problem appears to be, the answer is quite simple. Easy, secure, and on-the-fingertip access to healthcare data. You may ask, how can availability of health records reduce cost? You may also wonder if access to health data can solve the rising cost issue, then what is stopping us?

To answer these questions, let us first understand what constitutes healthcare expenses. According to CMS, the top three key healthcare expense categories are:

  • Hospital care - 33%
  • Physician and clinical services - 20%
  • Retail prescription drugs - 10%

Hospital care by far remains the highest contributor to healthcare expenses. A staggering 13%~ is for hospital readmission, and medicare spends constitute 26 billion USD annually on hospital readmission [3]. A significant portion of the clinical services cost is due to unnecessary test and/or retest. Also, prescription drugs are on a rampant rise, compared to a decade ago, the prescription drug cost has shot up by 45%.

The rise in hospital care is also because of the rapid increase in chronic illnesses such as diabetes, renal, and cardiovascular disease. While the advancement of medicine has helped contain the illnesses it requires a lot of discipline in people’s lifestyles to put chronic maladies under control. This is not often adhered to causing many ER visits. According to a report released last year by Premier, about 30% of ER visits by chronic patients are unnecessary, causing a loss of about 8.3 billion dollars annually. This has a cascading effect as the ER visit leads to unwanted, routine lab checks. The lab results are repeated because the patient’s data is not available to the ER doctor.

Let us look at another data set now. A 2019 report by census.gov states there are over 54 million people in the age group of 65 and above, making up 18% of the total US population. By 2030, one in every five Americans will be in the age group of 65. Healthcare expense are only going to increase with the expanding older population unless we do something radically different.

While there are many avenues to reduce the ever-increasing healthcare expenses, this section will focus on how access to health records can help facilitate the same.

  • Healthcare analytics analyzes millions of patient health records and deciphers how to make care better, faster, and cheaper. With the advent of cloud, quantum computing, and data sciences, conclusions can be drawn from the heaps of EMR/EHR data at lightning speed using healthcare analytics.
  • Catch the disease state early in the process. By doing early clinical data analysis we can find early indicators and can help reduce the risk by putting patients in the right treatment plan or by intervening and instilling lifestyle changes. For example, the cost of cancer treatment significantly increases from phase I to phase IV. A U.S. study shows early detection of cancer can save about 26 billion dollars a year.
  • Payers can look at the treatment given for a particular procedure over time and see how effective it is. Based on the effectiveness, CMOs can then alter treatment plans accordingly. This can also help reduce unnecessary ER visits of chronic patients, as data can help intervene in the treatment plan before the chronic condition elevates and results in a hospital visit.
  • Redundant cost reduction minimizes healthcare waste by allowing the patients to take control of their data in a safe, easy, and ubiquitous way. For instance, XRAY, MRI, or costly medical tests once taken can be repurposed as we change doctors or medical institutions.
  • Cost-effective treatment for chronic disease allows the import of prescription drugs from other countries. This is one of the proposed rules from the Trump administration.
  • Medicare to re-negotiate price for expensive prescription drugs. This is a proposal from the House of Democrats.
  • Hospital readmission costs are on the rise. The prime reason is the discontinuation of care services. With technology, the patient can be coached, educated, and monitored after they leave the hospital and care intervention can be initiated when conditions resurface/deteriorate. Technology can help keep the engagement with patient all through the lifecycle of recovery, regardless of where they are located.
  • Enable new technology startups to leverage healthcare data to find faster, cheaper, and effective ways of treatment.
  • Value-based care measures and reports the physician performance in a more meaningful and transparent way. It creates reports on performance at the physician network, medical group, practice site, and individual physician level, for both doctors and consumers. Value-based care benefits all. It helps patients to manage their disease state with accountability and reduction of price. Providers can provide a differentiated experience to the patient, and the payer can control cost and reduce risk. Essentially, everyone aligns to provide the best healthcare service with optimal cost.

So, if there are so many benefits to making healthcare data ubiquitously available what is stopping data access? The resistance is because of business, political, and technological limitations. Also, the recent healthcare data breaches have only made the access to data more difficult. Let us look at some of the resisting forces:

  • EHR-vested interest: For long, companies providing electronic health record solutions have resisted the change. It is a closely-guarded ecosystem and open healthcare data access can allow many players to enter this market, causing a threat to these businesses.
  • PBM-vested interest: The formulary and contract agreement between drug manufacturers, drug distribution suppliers, and payers are by design and not transparent. The larger the distributor or stronger the payer’s network, the better discount they can demand. Since there is a big anomaly on how the cost structures vary between different entities, this is a best-kept secret.
  • Promoting prescription drugs: Though often there is a good and comparative alternative to prescription drugs, these are prompted for reaping higher margins.
  • PHI-data privacy: This is often used as a shield to limit technology from free access to data.

Conclusion

The CMS has mandated the use of FHIR, a modern web services-based approach to share and consume data. FHIR solves many of the technical difficulties that HL7 caused and is well poised to make healthcare data available on multiple platforms in a secure, easy, and safe way. Many healthcare tech startups will leverage this new standard to create a differentiated solution to elevate the care experience and reduce cost. Much will depend on the large EMR/EHR companies, health institutions and government to help create this ecosystem and make top-class care available at an affordable cost.

CMS has mandated the use of FHIR, a modern web services-based approach to share and consume data.

FHIR solves many of the technical difficulties that HL7 caused and is well poised to make healthcare data available to consume on multiple platforms in a secure, easy, and safe way.

  1. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3228137/#B2
  2. https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/Downloads/highlights.pdf
  3. https://revcycleintelligence.com/news/3-strategies-to-reduce-hospital-readmission-rates-costs
  4. https://www.pgpf.org/blog/2019/11/why-are-prescription-drug-prices-rising-and-how-do-they-affect-the-us-fiscal-outlook
  5. https://www.modernhealthcare.com/article/20190207/TRANSFORMATION03/190209949/unnecessary-ed-visits-from-chronically-ill-patients-cost-8-3-billion
  6. https://www.ruralhealthinfo.org/toolkits/aging/1/demographics
  7. https://ascopost.com/News/59711
  8. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3228137/
  9. https://www.who.int/health_financing/documents/health-expenditure-report-2019.pdf?ua=1