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HC Webinars: Hello, everyone. Thanks for joining us today. My name is Laura Martin, and I will be your host for today's webinar.

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HC Webinars: The presentation we will be covering for you today is looking ahead. Market trends, impacting key healthcare issues presented by Leslie Faulk, chief client, success Officer and Tim Zinger, Vp. Of market insights and research.

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HC Webinars: Before you begin, I want to cover a couple of housekeeping items.

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HC Webinars: All attendees have been placed on mute, and cameras are off to eliminate background, noise, and distractions.

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HC Webinars: Please use the Q. And a panel to ask questions and interact with our speakers. Throughout the presentation.

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HC Webinars: The slides and recording of this presentation will be emailed tomorrow as well as published on our website.

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HC Webinars: And as a reminder, ceus are not provided for today's webinar.

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HC Webinars: That's all I have for now, so I'll hand it over to you. Tim and Leslie.

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Tim Zenger: Great thanks a Laura. Let me just introduce myself for those of you who who don't know me.

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Tim Zenger: Tim Zanger.

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Tim Zenger: Background and investment banking heavy research. It's it's my job at health catalyst to be a little skeptical of everything we do.

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Tim Zenger: and to validate or refute our internal claims with research, with data on. So I spend a lot of time looking at a lot of research and data. And so, Les, might you give us an overview of yourself.

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Leslie Falk: Thanks, Tim. I'm a bit of a skeptic myself, and I'll tell you why in a minute I started my career as a registered nurse opening the first peeds Icu in the State of Nevada, and then I was blessed to continue my education, getting work and engineering, and also from a business perspective, working for Kaiser permanente in the Northern California area, and then for Hewlett, Packard Medical Products Group for many years.

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Leslie Falk: and I work at health catalyst. And I, too, am a bit of a skeptic, because what my team focuses on is making sure that we are delivering on our mission to our clients, which is ensuring that they have value from our products and from our services.

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Leslie Falk: And Tim and I are really pleased over the next hour to talk about market trends.

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Leslie Falk: And we want to talk about market trends from the standpoint of

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Leslie Falk: how can we find solutions to these using data and analytics? And we want to first of all, find out a little bit about what your interest is. So we have 4 topics that we can, that we are going to cover economics, data, analytics and AI value based care and health equity. We'd like to have you take a poll question and then we will adjust the order in which we cover these based on your interest. So, Laura, I'll have you run the poll question.

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Tim Zenger: Yeah. So so while the poll comes up, I love doing this type of stuff. A lot of webinars, you see, have a very structured linear script.

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Tim Zenger: We're gonna go off script today. So however, you know, whichever areas get the most votes, we're actually gonna go in a different order than potentially how the slides are

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Tim Zenger: in order today. So we'll give it about another 10 s

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Tim Zenger: and then we'll have a Laura

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Tim Zenger: turn it off

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Tim Zenger: alright. Okay.

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Tim Zenger: so looks like the order we're gonna go in today is it's like almost 50% of you wanted us to start with data and analytics. So that's gonna be number one, number 2 is gonna be value based. Care

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Tim Zenger: number 3, eking out health equity is economics. So economics will be the third one. We'll go over.

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Tim Zenger: and then last, but not least, we'll talk a little bit about

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Tim Zenger: health equity.

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Tim Zenger: So let me jump to

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Tim Zenger: one slide and then we'll jump into the data and analytics area. One thing about kind of my roles and responsibilities here is I spend a lot of time as eyes and ears for our leadership team

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Tim Zenger: on what's going on in the market. So last year

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Tim Zenger: I saw over 87,000 pieces of content news articles, research papers, and it's my job to sift through all of that.

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Tim Zenger: read it, interpret it, and then help our team understand the signal from the noise. What things do our teams need to understand and pay attention to. And last year we ended up flagging about 1.4% of all that content

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Tim Zenger: as signal that our teams need to pay attention to. So a lot of this information today is from that signal

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Tim Zenger: that our team has spent time talking about internally. Why is it important

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Tim Zenger: things of that nature. So I just find that an interesting, helpful context of what kind of goes on in my day to day, and what I spend a lot of time doing so, we'll start off with the data and analytics

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Tim Zenger: area. The first thing we see in this market is for healthcare organizations.

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Tim Zenger: We no longer exist in a world where more data is the answer. I remember starting my career, you know, over a decade ago in healthcare, and it was always like, if we had big data, more data. If I had more information, we could be better at serving patients. Now

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Tim Zenger: we live in an overwhelming sea of data. A tsunami of data

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Tim Zenger: and clinicians. Administrators often feel overwhelmed with trying to just like my job, identify signal from noise in the data. You know, as a nurse. And you know, talking with a lot of our clients. Les, do you feel like this is, you know, more relevant today less relevant. What's your reaction on this.

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Leslie Falk: Yeah, I think it's even more relevant. Jane had put a question in, and she was talking about the news about Walmart shutting down their health centers, which I read. And I'm sure you did, too. Tim. And she wanted to say, I'm really interested in health, economics, health, equity, and value based care which we will cover all of those

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Leslie Falk: in as it pertains to this comment around the amount of data I've shared this story with Tim, but I think it's worth sharing with all of you who are attending. When I worked at Gila Packard, one of the colleagues I had was an analyst, and he came into our team meeting one day and he said, You know what? I'm not. Gonna provide any more data to this team until you can tell me why you need the data. And if you have the data, what you're gonna do

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Leslie Falk: with the data. And frankly, I was a little bit offended by that. But for those of you who are analysts, I bet you can really relate to the approach that this person took, and it made me step back. And it made me think about.

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Leslie Falk: yeah, what data do I? Why, why do I need this data?

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Leslie Falk: And most of us are familiar with an improvement methodology called plan, do study act. We're really good at the do part. We're pretty darn good at the act part. We're not so good at plan, and we're not so good at the study.

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Leslie Falk: And what do I mean by plan when we're looking at what Tim is sharing here about the fact that 97% of the data goes unused. We have to step back and ask ourselves when we're asking for data, what's the question we're trying to answer with the data when we can articulate what that question is, Tim, then I think we can be clear about the data we need versus just going out and collecting a bunch of data that we may or may not need.

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Leslie Falk: The other thing that we need to think about is when we look at the fact that 71% of clinicians don't know what to do with that data. To me that's related to the do part in terms of what interventions are, make the most sense.

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Leslie Falk: and then the study part of it which is looking at it and saying, Am I using the analytic methods that allow me to look at that data and say, was an improvement made, or wasn't an improvement made? And when we can tie that together, then I think clinicians can look at it and say, Yeah, I understand why I'm doing an intervention, because this is the result or a financial analyst, whatever the data is being used for.

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Tim Zenger: Yeah. And it's interesting is to that question around Walmart.

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Tim Zenger: exiting direct, patient care.

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Tim Zenger: One side of me. It's really sad

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Tim Zenger: cause it highlights a problem we have in our industry that you can't just throw money and resources at this like this is not easily fixed with just money. This is not just. We need more bodies. We need more money.

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Tim Zenger: Because if anyone, I do a lot of financial statement analysis in my career, if anyone has the balance sheet to make it work. Walmart was the one

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Tim Zenger: to make it work, and if they are like we have.

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Tim Zenger: we can reach 90% of the us population with our stores, with brick and mortar stores, and we have the money to do it, and they can't make it work.

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Tim Zenger: It's a little disappointing. And you know, this data was a cross industry research study done around the maturity, specifically

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Tim Zenger: analytics maturity of each industry. And sadly, you'll see all the way to the left. The place you never want to be in is at the bottom of a maturity. Scale list is healthcare. Providers

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Tim Zenger: are the least mature. That doesn't mean we're not doing good work. It doesn't mean lots of people aren't trying really hard. It just means us as an industry are behind

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Tim Zenger: our peer industries. And I think the Walmart Cvs. Walgreens

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Tim Zenger: highlight, that

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Tim Zenger: that everything that works in every other industry doesn't work in healthcare, and we're slower to adopt. We're slower to move.

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Tim Zenger: And the thing that's most sad about that is it? And it ends up impacting patience.

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Tim Zenger: you know the most. And so

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Tim Zenger: how do you think about less? You know the maturity of our industry. And what does that mean for healthcare organizations and patients.

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Leslie Falk: Yeah, I think you, I think you talked about a couple of areas that are of interest to me. One is around quality and

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Leslie Falk: looking at analytics, maturity related to the quality that we deliver.

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Leslie Falk: But the Walmart example is also a good example. When you look at the key insights in the Green Box.

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Leslie Falk: As I think about analytics, maturity, I would also be looking at it from a financial perspective and saying, the more mature I am from an analytics perspective

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Leslie Falk: the better my revenue and margin performances at 3, 5, and 10 years, and as individuals who are attending this webinar, if you're an analyst and you're putting together your strategic plan. I would be using this data and talking about why we need to have analytics, maturity and what the benefit is for the organization, both financially and also from the patient quality perspective.

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Tim Zenger: Yeah, you bring up such a great point, les, that there is a direct relationship to

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Tim Zenger: analytics, maturity, organization, maturity, and direct financial performance over the long haul. So this is not just theory. This has really

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Tim Zenger: direct ramifications for strategic priorities, financial performance.

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Tim Zenger: And it's actually interesting that we highlight the Walmart example here retail. And

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Tim Zenger: we talk about maturity. What is the problem? Then, if we have all this data, it's going unused.

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Tim Zenger: We want to, Laura, if you'd launch this poll of as you think about your organization faces, barriers to become data driven.

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Tim Zenger: What is the biggest barrier, is it people?

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Tim Zenger: Is it processes?

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Tim Zenger: Is it culture? Is it? Technology would love to just get a take? Because I'll share on the next slide some data we've seen over time and would love to see kind of how the respondents feel like they are.

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Tim Zenger: So we'll give it about another 10 s. We got about 40% of the respondents

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Tim Zenger: here

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Tim Zenger: looks like

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Tim Zenger: we're slowing down a little bit.

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Tim Zenger: Okay, we're gonna wait till okay.

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Tim Zenger: gonna end the poll.

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Tim Zenger: And we're gonna share the results. So

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Tim Zenger: as I would anticipate. As a researcher this would have been my hypothesis. Right? So 42% of the respondents are, you know, on our webinar saying, processes are the biggest problem.

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Tim Zenger: And then it's tied, you know, with culture and people

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Tim Zenger: as the next biggest barrier and then lagging behind is technology.

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Tim Zenger: And it's interesting. I I watch a lot of vendors over our spaces and over the years. And

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Tim Zenger: a lot of vendors may claim that it's just technology that's going to solve the problem, but actually just throwing technology at a process or a people problem

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Tim Zenger: without thinking about those, it actually can make it worse. So you look at this research here on the left

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Tim Zenger: is research done by fortune, 1,000 companies asking their senior leaders the same questions. So you'll see almost 80% of them. And fortune. 1,000 companies are saying.

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Tim Zenger: our biggest barrier is people. They put people culture and processes together. But this isn't a technology problem. In most cases it's a culture, it's a process. It's a governance

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Tim Zenger: process. And as you look on some, if we specifically just look at data ingestion, maybe it's the technology, maybe we don't have, you know. Maybe that's why we need to go to fire as opposed to HO. 7 interfaces.

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Tim Zenger: you know, 68% of the time in this ingestion research. It's actually the people that are the problem that are the biggest barrier. And so that's a question. I think that's worth asking your teams and your organizations is what are the actual barriers. And if we're gonna adopt a new technology process, bring on new people

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Tim Zenger: that alone probably won't solve or improve. You gotta have a combination of all these together, which is what I'm sure you've seen over the years as we talk about clients who have had success less is it's a con. It's really a combination.

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Leslie Falk: It really is, and I thought it would be useful to give some examples, because, you know, it's one thing to talk about it, Tim, and and talk about it from a people process culture technology. But I think it's important to give examples. And I bet

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Leslie Falk: people who are attending have examples they can share as well. And Jane put another comment in, and she was talking about hey? Walmart's fabulous at AI. And can we talk a little bit about AI, and we will, Jane, be talking about that. So it's almost like you're reading what's coming next. So

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Leslie Falk: we'll we'll get to the AI part of it. Because what would any webinar Tim.

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Leslie Falk: or anything without AI in it today be if we didn't include it? So we're we're gonna weave that in and and look forward, Jane, to your response back and other people's questions as well. So let me give you some examples on people process technology. One example is, let's say I'm doing clinical improvement work, and I'm looking at sepsis. And I say I'm looking at my 3 h bundle compliance, and I'm not consistent with what I would expect from

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Leslie Falk: from a baseline perspective. So I wanna do that improvement

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Leslie Falk: technology alone won't get us there. We have to have clinicians who are committed.

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Leslie Falk: who are accountable, and also who have the processes in place in order to do the improvement work to move the needle, so we could know what our baseline is. We could be tracking what's going on. But we still need to have the people and process piece.

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Leslie Falk: and it's not just clinical improvement, as you all know, for those of you who are attending that are more on the financial side of it. Let's look at something like charge capture if I am doing a root cause analysis. But I'm not doing anything to address the root cause what is called root cause remediation. Then I'm gonna see those same issues month after month. Well, that doesn't make any sense. I want to be using the data to look at what the root causes are, and to address those.

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Tim Zenger: And and it's interesting as we talk about root cause improvement. And it's actually really fascinating as we think about the retail. Why didn't the disruptive retail giants

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Tim Zenger: make traction in the market. Why wasn't I successful? And one

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Tim Zenger: potential element I would propose is this is some

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Tim Zenger: data from Gartner that they track on it, spending and the purpose behind the spending specific for health systems and hospitals.

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Tim Zenger: And as you look at this over the years, they have multiple categories that they go research and ask and say how much of your it spending was in just maintaining systems

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Tim Zenger: is the dark blue you'll see in the green is we're looking to grow, expand our technology right, which roughly, is about 10 to 12% and then transform

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Tim Zenger: is call it 10%

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Tim Zenger: is spent in transformational efforts where the bulk of this 8 tenths is spent in. I'm just keeping the lights on.

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Tim Zenger: and a mentor of mine who works for one of the largest healthcare technology vendors.

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Tim Zenger: He often would always tell me he would always hate when people would use the word disrupt or significant transformation, because we as an organization aren't built that way, we, as a industry.

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Tim Zenger: are very conservative. We're spending the bulk of our time maintaining. And so to come out and say, we're gonna transform something.

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Tim Zenger: It's just the reality doesn't work that way. Now, I don't know what

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Tim Zenger: the ideal mix is. I actually think this is would be a healthy thought exercise for you and your leadership teams to be like. What should it be?

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Tim Zenger: I don't know that I have an answer, but I probably would propose. Our current mix isn't ideal.

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Tim Zenger: And so how do you remove

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Tim Zenger: so much time keeping the lights on when you see so many opportunities for improvement, which I'm sure you've seen lots of those great opportunities for improvement. Les.

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Leslie Falk: I have, Tim, and like you, I wasn't surprised that maintenance was the largest percent. I was just surprised that it was 80%.

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Leslie Falk: It's just it's it's daunting! And as we think about it.

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Leslie Falk: I'm I look at it. And I say, what are people doing to reduce the maintenance side of it. And I'll give you 2 examples using data and analytics. And again, the reason I'm giving examples is we don't just want to talk about these trends. We want to say, what are some solutions people are utilizing to address these.

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Leslie Falk: So one area is in the area of automation

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Leslie Falk: around things like software upgrades or ingestion of data sources and data validation. And I'm gonna give a shout out to John Henderson, who's the chief information officer for Children's Hospital in Orange County. One of the things that he did that allowed them to be more focused on the transformation side of it

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Leslie Falk: was that they were looking at the amount of analyst resource time that was being spent developing Ehr reports. These, Tim are pretty. They're static reports, and when you give a person a report generally, what happens next? They ask another question, and then you have to produce another report, and then what happens? They ask another question, and you have to produce another report.

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Leslie Falk: John and his team invested time in developing some business, intelligent tools and dashboards and reports that allowed them to be able to drill in allowed end users to be able to drill in to

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Leslie Falk: answers, to get answers to questions.

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Leslie Falk: and in doing that they were able to free up a large percent of people that were building these reports. And how did they use them? They used them to drive transformational work by having the analysts be part of improvement projects that were going on across the organization. So those are just 2 examples.

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Tim Zenger: Yeah, thanks. Les, and and we'll we'll move on to kind of the last

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Tim Zenger: section here. The last slide around kind of the data analytics before we move on to value based care.

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Tim Zenger: I always love to try to find data in places you may not expect to find really relevant data. So this was some research. I did. The great thing about hymns

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Tim Zenger: is it's a central place for a lot of vendors. So typically over a thousand vendors sign up

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Tim Zenger: and attend hymns. The cool thing about him is when a vendor registers, they self identify.

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Tim Zenger: call it 35 different categories and 200 different subcategories. A vendor can go and select and say, we offer a solution in this area. So do realize this is self-identified data.

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Tim Zenger: but it is really fascinating. So on the Y access I took and said, as of the last hymn, so you know, about 6 weeks ago.

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Tim Zenger: 2,024, the y axis is the percent of vendors that a hint that attended him's this year that claimed

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Tim Zenger: to have a solution or offering in the given area. So you'll see.

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Tim Zenger: AI is the highest on the Y axis, you know, with 30% of the vendors claiming to have a solution in that area. What I also looked at as I went back over the last 5 years to look at. How have these changed

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Tim Zenger: over time?

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Tim Zenger: So just the surprise of No. One? AI has seen the highest increase of vendors claiming to do AI from 5 years ago. You'll see in the bottom left box, or things like

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Tim Zenger: ambulatory. Obviously pandemics, nursing, nursing, specific applications are seen, ones that there's been a contraction

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Tim Zenger: in vendors over time, and I just find it interesting. I can't go almost a day now without seeing

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Tim Zenger: provider organizations.

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Tim Zenger: our peers or competitors, or people in the market. Talking about AI,

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Tim Zenger: the one thing I will caveat is the way I would describe AI philosophy, I would say, in the short term, I'm bearish

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Tim Zenger: and long term. I'm bullish, meaning I'm really excited long term about what AI does in the short term, though what you almost see in this data over time is anything in that really top right quadrant section.

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Tim Zenger: once it gets there. If you were to go back 3 or 4 years. Population health was there. If you went back 7 years inner interoperability was there, you'll start to see a pullback and consolidation of lots of people are starting to ask the question of

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Tim Zenger: not that the hype isn't real, but what is the Roi? What can we do with this? What are the specific use cases? And

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Tim Zenger: as you look at the hype cycle, Gartner predicts that this year AI. Specifically, Gen. AI will enter the trough of disillusionment

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Tim Zenger: which just means

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Tim Zenger: the reality of what's going to be offered will come to the forefront, and anything on the outside will kind of go by the wayside over the next 12 to 24 months would be my hypothesis.

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Tim Zenger: How how do you respond, les, as you think about everyone talking about AI in this.

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Leslie Falk: Yeah. There's no doubt, Kim, that we're at the peak of the Gartner Hype cycle. And do I think Gartner's right that we're gonna get into the trough of despair.

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Leslie Falk: Yeah, I think. Probably.

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Leslie Falk: I hope we don't get way down in the trough, and let me tell you some things when you talk about

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Leslie Falk: Tim saying, you know, what's the Roi? What are some practical uses where there's real benefit coming, I think, about 3 things so like Tim in the long run. I'm bullish, and I'll tell you why. I'm bullish, because I'm gonna give you 3 examples where I see data and analytics making a difference. Using AI.

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Leslie Falk: One example is patient engagement. So for those of you who are familiar with patient engagement digital solutions, I'll give you 2 used cases. One use case might be. I'm trying to reduce the number of no shows that I have for an ambulatory setting, and so I'll send out a message reminding Tim, hey, Tim, your appointments tomorrow, and, Tim, when you come, make sure you bring such and such

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Leslie Falk: and another use case. Example might be surgery cancellations, and you probably all get these kinds of messages. Remember your surgeries tomorrow at, you know, 6 o'clock, and you're not gonna want to eat after such and such a time.

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Leslie Falk: So how does AI help with that? Well, you can use AI to understand for Tim versus Leslie versus Julie.

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Leslie Falk: and say, what is the right? What content are they most engaging with, and what time of the day? As an example, is it best for me to send them that information in order to drive no show rates down and cancellation rates down. A second example. Tim, would be chart abstraction. So for any of you who do chart, abstraction work or no people who do. It's very time consuming.

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Leslie Falk: And a lot of it is unstructured data. And so we are using AI today

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Leslie Falk: and using that AI to help come up with what the recommended answers are, and also the supporting evidence. So when we come up with the recommended answer, using AI. We provide also the supporting evidence.

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Leslie Falk: so that a skill chart abstractor is able to look at the information and say, yes, I agree with that recommended answer, Tim or no, I don't think that's right. And here's the reason why they highlight the reason why, and the AI model is able to learn from that

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Leslie Falk: and adjust the recommendations going forward. A third area is in the area of healthcare.ai, and Tim. This is like the bullseye in my mind of saying, What's the prom pragmatic Roi used case for? AI healthcare.ai is a suite of products that uses statistical tools as well as machine learning, and it is applied in the work stream for business, intelligence tools.

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Leslie Falk: data, a healthcare and AI is like having a data scientist in a box, and you can apply it within your business intelligence tools to analyze the data and to come up with the correct analysis

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Leslie Falk: in that plan. Do study, act, portion of it.

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Leslie Falk: I see, Tim, before we go to the next slide that Julie asked a question about, you know, in research is data utilization more efficient in organizations, unique using lean methodologies.

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Leslie Falk: I can't answer that from a research perspective. Because I

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Leslie Falk: I'd I'd want to go out and look at multiple pieces of research. But what I would say, Julie, back to that is that organizations that are using lean methodology and really taking that principle that we talked about of technology, people, processes and culture and using the plan, do Study act, which is part of lean. Then I would say they would be more likely to be efficiently using data and analytics.

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Tim Zenger: Yeah, the thing I would. I would piggyback on top of that is, I've not seen anything specific to call out leans impact. You know that specific methodology.

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Tim Zenger: I have spent quite a bit of time this year researching literacy

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Tim Zenger: and movement and changes in literacy across organizations. And the one common thing I do see across the research is organizations that select a methodology specifically with a measurement

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Tim Zenger: are those that tend to see a following reaction and increase in utilization. So I don't know that I could be strong and say, Lean is the best, or it works. It's more around the line of that. There's a common definition, a common methodology or framework that is selected.

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Tim Zenger: And the important thing is that that there's a measurement for

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Tim Zenger: literacy.

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Tim Zenger: for maturity, for advancement, and that is widely used and adopt. That's been the elements I have seen the most is that the measurement and ma is more important than a specific

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Tim Zenger: methodology is how I would articulate it of what I've seen.

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Tim Zenger: Thanks. These are great questions. And I keep them coming as you guys have thoughts

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Tim Zenger: jumping into the second one. You guys wanted to hear about value based care.

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Tim Zenger: One of my favorite things to do is primary research. And what I mean by primary research is, we run our own studies. So I get the great opportunity to run our own research.

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Tim Zenger: And we interviewed 97 population health leaders. So they had to be strongly involved in their organization's population health programs and initiatives, and we asked them a series of questions.

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Tim Zenger: One of my favorite questions we asked them was totally unprompted and open, ended, we said.

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Tim Zenger: Define population, health for us.

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Tim Zenger: That was the question we asked. What we ended up then doing was, I ended up coming back and doing a comparative text analysis

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Tim Zenger: of all the answers. And the crazy thing on the left is what we ended up finding out is

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Tim Zenger: 87% of the respondents

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Tim Zenger: gave us a wholly unique definition of population health.

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Tim Zenger: That doesn't mean you'll see on the right. There was some common elements.

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Tim Zenger: as we think about a defined population focusing on outcomes.

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Tim Zenger: But the big takeaway for us is, we think about. I would articulate that by based care and population, health as an industry. We've been fairly stagnant in our movement.

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Tim Zenger: It's because we're all running a different direction.

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Tim Zenger: Every organization goals programs are totally different. So

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Tim Zenger: if you've seen one population health program. You've probably only seen one population health program that was pretty eye opening to us of

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Tim Zenger: how uncommon common definitions were here.

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Tim Zenger: Does that stand out to you as well? Les.

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Leslie Falk: Yes, I think that last statement. If you've seen one, you you it. That's definitely a a true statement, and I think what the reason we wanted to include this slide beyond. The primary research in the ha that Tim shared

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Leslie Falk: is to encourage you that if you are working on population health to make sure that you're aligned in terms of what are the objectives that you are trying to achieve with your population health initiatives.

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Leslie Falk: and you wanna make sure you have that because the data and analytics will support what? What? That, what it is that you're trying to achieve. One of the things that we do when we work with healthcare organizations is, we start by what we call understanding a smart goal, which is what is the objective like. And then we say, how are you gonna measure success

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Leslie Falk: when you can identify what you're trying to do? And then what that measure of success is.

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Leslie Falk: it will at least allow you within your organization to make sure that you're aligned in terms of what your central goal is.

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Tim Zenger: And it's interesting, as I've presented this data a couple of different times to some client groups or customers that we have, and a few customers have told me they wouldn't be surprised if they ran the same study just at their internal organization. So one organization that they might get 87% different definitions internally.

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Tim Zenger: So we think that it's a common problem and driving common definitions. And to Les's point, common goals.

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Tim Zenger: how are you going to measure success

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Tim Zenger: really can help push your population health initiatives forward.

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Tim Zenger: And this is something. Ever since the beginning of my career in healthcare.

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Tim Zenger: It's always this year. It's always right around the corner, and I couldn't help but put in this little.

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Tim Zenger: you know cartoon of we did it. We time travel. What year is it? I don't know. Let me ask this guy over here. Hey? What do you think of population, health or value based care? That's just around the corner. Yeah, I have no idea what year it is. I remember being heavily involved in studies in 2,013 and 2,016, where we asked

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Tim Zenger: population health leaders to predict

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Tim Zenger: how far out will it be till value based? Care contracts outpace the volume of your fee for service.

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Tim Zenger: and in both years they said. Within 5 years more than 50% of all of our revenue will come from via basecare contracts.

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Tim Zenger: Well, it's a decade later, and we're still inching like molasses. So you'll see, this is

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Tim Zenger: probably the most comprehensive data set I am aware of when it comes to

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Tim Zenger: payments. This covers about 85% of all payer payments and the contract method it's paid through.

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Tim Zenger: So you'll see, in 2022, only about 10% of all payments were made in population health payments, which is full downside risk, full cap

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Tim Zenger: in Category 3 in the alternative payment model is, you do get into a little bit of upside and downside risk.

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Tim Zenger: But in my mind, via based care just pay for performance paid for quality metrics. That's not Vi-based care

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Tim Zenger: you there's got to be downside risk in my mind. And we as an industry.

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Tim Zenger: are just really really slow to move. And the thing that gets really crazy is when you break this out by payer type.

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Tim Zenger: So if you think of Medicaid Medicare ma plans, there's a significant increase. The number the orange boxes go to like north of 20.

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Tim Zenger: But what happens when you go to the commercial side of the market? It goes down to under 3%. So you look at this as an industry, especially on the commercial side.

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Tim Zenger: We just aren't structured and haven't been interested in moving to full risk right now. So it still feels like it's just around the corner, but that around the corner feels like it might be multiple decades away.

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Leslie Falk: I love the cartoon.

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Leslie Falk: and we did our own survey at our healthcare analytics Summit in 2018, and we asked the same question.

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Leslie Falk: how you know, where is value based? Care gonna be in 5 years. And what did people say? It was going to be accelerated? It was going to be in the 60 to 70%. And you look at this data and you say, Hmm, why is it slower?

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Leslie Falk: And if you think about it, you think about. Really, there's 3 stakeholders that are associated with value based care. One of them is the patients, the other is payers, and the third is providers.

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Leslie Falk: And as we look at value based care, most of the models have really been focused on 2 of those 3 stakeholders. So I think that's one thing for us to consider as we think about value based care, and the shift is making sure that all 3 stakeholders are being included.

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Tim Zenger: And a couple of questions come in. Neil asked a question around what pairs are included in this data. Set. The Land Institute covers all pair types.

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Tim Zenger: If you're interested in specific pay or breakouts, I'd encourage you to go to the Land Institute or reach out to us afterward and happy to put you in. You know, if you want

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Tim Zenger: medicare medicare advantage Medicaid, full commercial risk. All of those sub breakouts are in this data. This is all pair types together.

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Tim Zenger: and it's interesting. I've actually seen some other data specifically out of the Thomas Jefferson School Population health. They have some really good data sets around this as well.

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Tim Zenger: and the orange. They've actually started to see a contraction on the full risk side.

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Tim Zenger: so that those who are in full cap full downside risk. They've actually seen less organizations over the last 24 months. They've started to remove some of that risk. Now, I don't think that means that via base care is dead. I think

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Tim Zenger: you'll see organizations continue to move, fee for service into

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Tim Zenger: pay for performance tied to quality. You'll start to see them inch, but it starts to be like, can I make money?

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Tim Zenger: Can I make money? I mean, that's the key question is as an organization. Is it profitable for us. And so I think that there is some hesitation for a good number of organizations to go full risk at this point. Is it worth it.

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Tim Zenger: And is it worth it? It actually kind of comes back full circle to the Walmart, Us. As an industry. So if you're not familiar with

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Tim Zenger: the Cms Innovation Center. It's their job, as I understand it, to kind of disrupt payment

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Tim Zenger: plans and offerings in the industry to come up with something that's innovative, disruptive changes moves the needle.

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Tim Zenger: and they've over the last couple of years have created and tested 54 different alternative payment models and programs. So you'll see a bunch of the listed here on the left.

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Tim Zenger: The crazy thing is, only 5 of them

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Tim Zenger: made money.

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Tim Zenger: So in all these tests there's a lot. Now there's a bunch you could say maybe they're net neutral. Maybe they lost a little bit. You could argue and say, Tim, maybe they just lost a little bit, but the quality went up.

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Tim Zenger: The crazy thing is, is, there was some additional research done on the programs to say what was the impact on quality.

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Tim Zenger: and in almost all of the models there was no substantial improvement in quality to the patients. So we're spending a lot of money to test a lot of things to lose a lot of money

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Tim Zenger: to potentially not increase the quality to patients. I think this is just another headwind we see in why value based care has been so slow to progress.

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Leslie Falk: Yeah, this is sobering for May first. Springtime. This is a sobering slide when you look at it.

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Leslie Falk: and I think that as you look at the research and you read articles that people are developing like the Healthcare Financial Management Association, Tim, they had an article at the end of 2023, and they started talking about these healthcare State affordability boards. And the question they proffered up in the article were, was, you know, our

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Leslie Falk: consumers just growing thin in terms of their patience when it comes to the regulatory, and payers and providers? And are are they wanting to take things into their hands because they're just frustrated with not seeing the value based?

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Leslie Falk: Care that they're that they're hoping for? And then the other question was, ask, is, you know is this just a Trojan horse? You can see that when we have a key inside on the right hand side of the slide.

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Leslie Falk: you know, one could even look at it and say, You know, should we be focused on value based care? Because if we're not seeing an improvement in quality, and we're not seeing a financial benefit should we even be pursuing these kinds of initiatives? And I I think that's something we're gonna tackle. Continue to be challenged as an industry to look at and and answer that question.

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Tim Zenger: Yeah, and it pigs. The question, you know, Sam asks a question around, you know, the 1 million dollar question is, how do you bring all the legs of the stool together, and

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Tim Zenger: if I had the answer like, I probably wouldn't be sitting here, we would probably would all be retired, and I don't know that anyone does. I think in isolation I've talked to a number of organizations for a specific group of targeted population.

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Tim Zenger: Many organizations have seen some positive outcomes, bringing multiple all of the legs of the stool together to impact the thing that we as an industry struggle with

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Tim Zenger: is, why can we not do this at scale? Are the incentives misaligned?

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Tim Zenger: Yes, potentially are all the parties involved misaligned? Probably, you know, internally, or we miss, I I think that there's a a misalignment. Can you know? Problem we run into? And I do think it begs the question of

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Tim Zenger: is it the right thing to do? I don't have an answer. But I think it's a great thought exercise as a leadership team to ask that question be like.

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Tim Zenger: is it worth it? Is it just an investment. How do we think about this? Will this impact? I think there's just a lot of more questions right now than answers that I can potentially propose.

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Tim Zenger: Okay, so we got through

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Tim Zenger: analytics. AI got through value based care. We're gonna jump back

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Tim Zenger: to the beginning of the deck.

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Tim Zenger: So because you you guys didn't wanna talk about economic news at the beginning? I don't know why not? I mean, that's that's what I spend a lot of time thinking about is economic news. So let's highlight just a few things from a macro economic perspective. So

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Tim Zenger: spending as in as an industry compared to total Gdp spending, which is the top is percent of Gdp spent directly on healthcare, related expenses.

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Tim Zenger: both not just direct, patient, but as a country.

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Tim Zenger: And during the pandemic, if you looked at the month over month spending we almost reached 24% of Gdp. Was during the pandemic was spent on healthcare

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Tim Zenger: over the last 2 and a half years there's been a contraction in percentage. Our spending has actually still been going up

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Tim Zenger: Gdp growth over the bull market over the last 24 months has significantly outpaced healthcare spending. So that's why there's been a pull back over the last. But I have seen that plateaued, and there are in there are indications that healthcare spending as a percentage is going up.

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Tim Zenger: and a big proponent of that in the bottom chart is inflation.

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Tim Zenger: And one thing I want to highlight that often people misunderstand, that I hate. How the news talks about inflation is, they'll say inflation went down.

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Tim Zenger: Things are getting cheaper.

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Tim Zenger: The reality is, there is actually over the last 50 years there have only been 6 months

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Tim Zenger: where spending in the United States has got cheaper.

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Tim Zenger: So when inflation comes down from 5% to 3%. And it's 3% this month. Guess what?

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Tim Zenger: Things got

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Tim Zenger: more expensive by 3%.

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Tim Zenger: And Mackenzie did some research on this, where they anticipate that over the next 5 years in healthcare

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Tim Zenger: just specific to inflation expenses, every organization should account for an increase in over a hundred 40% of increased costs

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Tim Zenger: that an organization is gonna have to deal with over the next 3 to 5 years. So we should just assume that every strategic plan should assume that things are gonna be more expensive for the foreseeable future, and inflation has proven that it's been pretty stubborn. It's not got down to the target 2, and it probably won't anytime soon.

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Leslie Falk: Tim, I would put myself in the category of

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Leslie Falk: saying that if I were to predict, as Gartner did, around, what's going to happen with AI and the trough of despair. I, too, do not see inflation coming down anytime soon. I see it organizationally, and I see it personally every time I go to the store.

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Leslie Falk: and as we look at this, this is pretty sobering news, it's better than it was during the Covid period, for sure. On the other hand, as Tim talked about, if the economy contracts, it's likely that healthcare is a percent of Gdp will increase

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Leslie Falk: as we think about it. And we think about what our organizations doing, they are dramatically working on trying to reduce cost. And what are some examples of that in terms of how data and analytics can help. One example of that is what people are doing with Chat Gpt around scheduling

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Leslie Falk: another example. I live in Boise, Idaho, which is depending on what city you live. I consider it a medium sized city, but if you live in New York you would probably think that I'm a pretty small city.

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Leslie Falk: And as I think about what we're doing at the local hospitals in my community, one area that they're expanding is in the area virtual. Rn, so, taking our ends, who have extensive experience and utilizing them in a centralized location for anything that doesn't require face to face

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Leslie Falk: contact within our end. What does that do that allows you to be able to serve your patients more effectively, and it also frees up the r ends in terms of the face to face interactions that they need to conduct.

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Leslie Falk: Yeah.

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Tim Zenger: And and moving on another macro economic thing. And this was a few. This is a little while ago, since I've pulled this research, and it's been getting better. So you look at the bars over the last 2 to 3 months.

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Tim Zenger: The top is a

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Tim Zenger: margin index, the median performance of hospital margins. So you'll see 22 saw significant margins in the red. Really a tough year for almost all the organizations, and there's been an increase in margin performance over the last significantly. This year

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Tim Zenger: a lot of top organizations are starting to perform. Well, the interesting thing is the median.

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Tim Zenger: you know, if you're not familiar with statistics. Medi median means the middle. So 50% of organizations are above it. 50% of the organizations are below it, while on average, if you will, things are looking positive.

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Tim Zenger: There's a lot of organizations that are really struggling. So I pull just some financial data from financial statements that were publicly made over the last, you know, over primarily for 2023,

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Tim Zenger: I mean, a lot of notable organizations have still lost significant capital money

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Tim Zenger: revenue, and no one's immune

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Tim Zenger: to maybe outside of a few really really large organizations that I'm sure you could think of and name.

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Tim Zenger: But generally everyone has to think about, how do we do more with less? How do we be more efficient and productive with what we do have? Because things are becoming more expensive? Labor is becoming more of a challenge to management. It's just financial pressures. I do not foresee going away while there is some alleviation. It's still gonna be a real problem for the next year or 2 at least.

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Leslie Falk: At least.

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Leslie Falk: And you know, Tim, some people talk about healthcare and they talk about the margins being small, and that, you know, there's a small amount of room for error. I I don't think about it that way. I think about it, and say there's no room for error, and then I think about it from a mathematical equation and say, there's the revenue side and their cost side, how can data and analytics help? So if you look at it from a revenue cycle, I mean from a revenue side.

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Leslie Falk: I would give 2 examples in terms of data and analytics. One example on the revenue side is around. Charge, capture.

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Leslie Falk: Another example on the revenue side of it would be looking at things like revenue cycle management on the cost side of it, I think, very pragmatically about a foundational piece, and Peg had asked a question about value based care and population health. And this is tangential to to your question, Peg, but it ties in, and I'll I'll tell you how it ties in.

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Leslie Falk: So if I look at activity based costing, I need to understand what my true costs are if I'm going to try to control my costs. But I don't just need to look at my cost side of it. I need to be able to look at it

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Leslie Falk: and look at it from a patient perspective, not just in terms of how many minutes were spent in the or and what were the cost of supplies. I also want to look at that. And if I'm comparing like procedure a versus BI want to be able to look at it and have the data

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Leslie Falk: and look at the quality side of it, which is what were the patient outcomes, and I might measure that in terms of things like length of stay, or I might look at it and say, what were the what was the surgical signed infection rate, and I would be able to marry those together from a data and analytics perspective, to be able to make that assessment

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Leslie Falk: another area to think about on the cost side. And I know every organization is looking at this. And it's not just healthcare. And AI plays a big piece of this which is around labor productivity. So using data and analytics to look at your labor and understanding the different types of labor expenses you have? How do they vary from department to department, from organization feel like multiple

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Leslie Falk: hospitals. How do they vary from one hospital to another? And then the last area in terms of cost that we are seeing more interest in. And I think it makes good sense

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Leslie Falk: is around business process, optimization. Bpo, as the acronym and manage services. So Tim had the we, he, we shared the slide earlier around people, processes, technologies, culture. One of the things that you see when you look at the people side of it is. It's darn hard to find some skilled resources, and it varies, you know, depending on geography. Manage services, allows you to have those skilled resources, and

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Leslie Falk: it integrates the technology that allows for things like automation and the use of AI,

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Leslie Falk: and it's.

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Tim Zenger: It's interesting as you talk about productivity as you talk about labor management. The last thing we'll talk about here on the Macro

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Tim Zenger: economic front which it's all over the place.

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Tim Zenger: you know. Burnout stress, you know, working conditions. I see a lot of senior leaders concerned about

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Tim Zenger: employee safety, abuse, verbal physical, whatever it may be. So you look on. This large study on the left was done specifically just for nursing.

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Tim Zenger: and they potentially at least what the research shows has been the hardest hit or one of the areas that are hardest hit. So you'll see in 2023,

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Tim Zenger: you know, you're like 70 80% of the nurses that responded are feeling a lot or a great great deal amount of stress

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Tim Zenger: in their job. That's not healthy. You think about productivity

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Tim Zenger: done a lot of neuroscience research around, what is the impact of stress on productivity, on thinking, ability, on accuracy of decision making

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Tim Zenger: all of those become significantly impaired and impacted when you're just in a constant stress

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Tim Zenger: environment. And so this puts a

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Tim Zenger: obviously traveling nurses, you know, nurses being able to double triple pay for the same amount of work really shined. A light on this that nurses can go get paid more, and I'm always a proponent of paying more, and many organizations have given significant increases. But is it enough? Do Nur? You know, lots of research is highlighting that a lot of clinical staff is choosing to leave

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Tim Zenger: direct patient care and even the industry to other industries, because

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Tim Zenger: while this is not new at some point.

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Tim Zenger: and especially, I think, this becomes really interesting with the Ftc.

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Tim Zenger: Then non-compete, if that becomes, do all of a sudden. Does that open up options for clinical staff? If there's no longer non-competes available.

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Tim Zenger: are, those are no longer an option for organizations to keep staff intact. Does this become an an increase? The exodus? Potentially, this is just something that I see every organization talking about as labor management. Specifically, burnout stress. It's a common problem.

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Leslie Falk: It is a common problem, one of the activities that I participate in as I work as a faith community nurse within my local organization, Saint Alice, which is part of Trinity health.

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Leslie Falk: and as a faith community nurse, especially during the covid pandemic.

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Leslie Falk: I mean you, any of you who are working the front line, and you see this title Healing Hand strained Hearts. You can relate to it. I also do some work with nursing students at Boise State University, and I interact and hear the day to day stresses that they have. I, personally, from a data and analytics perspective, I asked myself

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Leslie Falk: every day is what I'm working on from a technology and a service perspective. Is it helping, or is it hurting this problem? And you know, Tim, you talked about how the impact in terms of productivity and the research that you've looked at. And I and I know that you would agree with this, which is, it's

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Leslie Falk: it is. It includes also the quality of care that that is being able to be delivered. And so this is a real thing. If you're in the data and analytics world. And you're providing anything related to clinicians. Ask yourself that question in terms of how can I help with what this problem is?

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Tim Zenger: Yeah. And so we're I always feel like I have. I'm way over prepared. We always have more content than we can get through. So we're gonna skip

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Tim Zenger: a few slides and jump to health equity and just hit on a few points so we can have time to wrap up here for you and actually want to come back to Peg's question around

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Tim Zenger: value based care, population, health continuum which she brings up such a great point.

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Tim Zenger: And I think this potentially here I would agree that

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Tim Zenger: organizations aren't strategically positioned aren't incentivized, whatever you wanna call it, to actually, whether it's wellness, whole person care. We're still fairly transactional episodic care, even though we have diabetes, care contracts, people are thinking about. How do I manage a population? You still generally get involved and paid when people show up and you get involved when a services delivered to them. So it's interesting. This was a really fascinating. This was a fairly large study done

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Tim Zenger: directly with physicians.

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Tim Zenger: and they asked, How much time do you, as a physician, currently have to effectively address your patient's? S. Doh needs.

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Tim Zenger: And so you look at that. And many people believe that. S. Doh non, direct, patient care, have the largest impact on their overall wellness. You know

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Tim Zenger: a lot of charts would say, potentially up to 80%.

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Tim Zenger: And so you'll see in the bottom that

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Tim Zenger: the majority of physicians feel like they have none very little. You know, 50 to 60% of physicians like, I just don't even have time.

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Tim Zenger: Like, if I'm only spending 10 to 15 min with this patient. Can I truly understand what's going on with their health?

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Tim Zenger: Do they have a do they live in a food desert, you know? Do they even have

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Tim Zenger: refrigeration for certain medications that have to be kept cool. There's just lots of things that you almost feel like. You just have to treat the symptoms as opposed to root cause. And us as an industry. I think that's a big problem with Vi based care is it's really hard to get ownership

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Tim Zenger: visibility. I mean, there's a lot of components of that to really end to end patient care. It's a big problem.

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Leslie Falk: Yeah, I'm gonna respond to. I'm gonna add on to what you were responding to, Peg and Mary about, which is, you know.

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Leslie Falk: Peg asked, made the comment that said, You know, how? How are we looking at it in terms of something like doing a surgery like if I get paid X amount of of dollars for a surgery. But if I could have done a treatment 6 months ago, and I could have avoided that surgery, you know. Would that have been the better outcome?

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Leslie Falk: And she made a comment. And I completely agree with it. Which is that when you think about data and analytics? Is it going to be the the the answer to everything? No.

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Leslie Falk: What? Probably in the situation that we're talking about here? It really is about incentive and structural changes. And so, as all of us who are in healthcare, we have an opportunity, and I challenge myself and all of you to be advocating for some of these structural incentive changes that need to happen in order to address these issues.

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Leslie Falk: And Mary Lee talk. Mary talks about the fact that it's sad that there's not reimbursement for nonclinical staff to address these needs.

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Leslie Falk: And again, I think that it's a call to action for all of us in terms of advocating for some of these structural changes that need to be made.

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Leslie Falk: And, Tim, I see that we have. Okay. You wanna add to Mary.

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Tim Zenger: I was just gonna make one comment, and then we'll wrap up. It's

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Tim Zenger: most health equity, Sdo, wage population health programs. I don't want to say, fall down. One of the biggest barriers is when it leaves an organization

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Tim Zenger: ownership

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Tim Zenger: and goes into the community

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Tim Zenger: like that's a really hard transition to continue the care in an appropriate fashion, when all of a sudden, you no longer own the employees or the community members. You're having a partner.

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Tim Zenger: the Acha, you know, articles that most organizations have north of 20 partners. They're engaging in the community. That's just a really hard thing to do.

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Tim Zenger: And as always, we appreciate you guys taking spending an hour with us.

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Tim Zenger: I could spend a long time talking about a lot of this stuff and really love to do it. If you guys have any questions for us, please feel free to reach out always happy to talk about this or other things. So with that I'll turn the time over to wrap up to Laura. Thank you.

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HC Webinars: Alright. Thank you, Leslie and Tim. I really enjoyed your presentation and the interaction we had with our attendees today. I think that was great.

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HC Webinars: For any questions we didn't get to. We'll answer those questions offline and post those to our website. So if you have any questions, feel free to go ahead and throw those in the QA. Panel. Right now

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HC Webinars: we want to thank you all for joining us today, and we hope you enjoyed this presentation. I am launching a poll, asking if you would like to learn more about health, catalyst products and services. This poll should only take you about 2 min

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