Karen DeSalvo Leaving ONC Immediately to Battle Ebola

Karen DeSalvo

As has been much reported, national coordinator for health IT, Karen DeSalvo, M.D., is leaving the office effective immediately to become acting assistant secretary for health in the Department of Health and Human Services. The announcement was made Oct. 26, 2014, by HHS Secretary Sylvia Burwell.

Burwell requested that DeSalvo to make the move in an effort to help battle and lead to containment of the Ebola crisis. DeSalvo will serve as acting assistant secretary until the Senate confirms an assistant secretary. There is no pending individual nominated for the permanent position.

Lisa Lewis, the ONC’s chief operating officer, now will serve as the acting national coordinator at ONC.

According to Modern Healthcare: HHS Secretary Sylvia Mathews Burwell, in a notice to her staff, welcomed DeSalvo, saying, “As the acting assistant secretary for health, Karen’s experience as a practicing physician, a senior member of the HHS team, and as a nationally recognized leader in public health, will be invaluable to the department and me.”

“She will bring her knowledge and real-world experience to bear on some of the most important issues confronting our department, especially our Ebola response efforts,” Burwell said.

DeSalvo was appointed in December 2013 and started in mid-January 2014. She took over after the departure of former national coordinator Dr. Farzad Mostashari who stepped down in October 2013.

To date, she’s the shortest serving ONC national coordinator, if she’s leaving the position permanently, which has not been verified.

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Patient Portals: Security Concern or Effective Tool?

Martin Edwards
Martin Edwards

Guest post by Martin Edwards, MS, CHC, CHPC, compliance officer, Dell Healthcare.

Patient portals offer an unprecedented opportunity to engage consumers, provide a customized care experience and potentially change behavior. Yet they also introduce new security concerns for both patients and providers.

A question we often hear from healthcare providers regarding security is: How much protection against negligence does meeting the HIPAA requirements really provide? That question is particularly germane to patient portals, which create an additional entry point and more risk to the security of protected health information (PHI). The laws and regulations in these cases can be confusing.

Fortunately for providers, “safe harbor” is offered in those cases where the provider can prove that they have properly encrypted all devices that contain PHI. Under the HIPAA security rule, as long as PHI is encrypted according to National Institute for Standards and Technology (NIST) guidelines, it is no longer considered “unsecured” and providers are effectively exempt from improper disclosure being considered a “breach.” Thus, the HIPAA breach notification rule doesn’t apply, and, by extension, the provider can avoid potential fines from the Office for Civil Rights (OCR). Since most breaches of PHI reported to the U.S. Department of Health and Human Services (HHS) to date have related to the theft or loss of unencrypted mobile devices, encrypting the data is a primary defense against data loss and against the consequences of improper disclosure.

While patient portals add risk, they also confer many benefits to healthcare organizations, including enhanced patient-provider communication and empowerment of patients. Some studies have found that portals can also enable better outcomes for patients. These benefits are behind the HIPAA privacy rule’s “right of access,” which allows individuals to examine and obtain a copy of their PHI. Meaningful use requirements also require eligible professionals to exchange secure emails with at least 5 percent of their unique patients. Since portals are an ideal way to meet this requirement, organizations seeking to comply with Stage 2 criteria have an incentive to adopt them.

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Wearable Technology Future is Ripe for Growth, Most Notably among Millennials, Says PwC

Twenty percent of American adults already own a wearable technology device and the adoption rate – on par with tablets in 2012 – is quickly expected to rise, according to PwC’s Consumer Intelligence Series – The Wearable Future report – an extensive U.S. research project that surveyed 1,000 consumers, wearable technology influencers and business executives, as well as monitored social media chatter, to explore the technology’s impact on society and business. In the last three decades, PwC has examined how technological innovation plays an increasingly prominent role in helping brands set themselves apart in their respective industries and how wearable technology can offer brands an opportunity to establish themselves, particularly in the entertainment, media and communications (EMC), health, retail and technology industries. In conjunction with The Wearable Future report, PwC’s Health Research Institute (HRI) launched a separate report, Health wearables: Early days, further examining consumers’ attitudes and behaviors toward health wearable technology.

While fitness bands, smart watches and other wearables are already established in the market, many of them have under-delivered on expectations. Consider that 33 percent of surveyed consumers who purchased a wearable technology device more than a year ago now say they no longer use the device at all or use it infrequently. Price, privacy, security, and the lack of “actionable” and inconsistent information from such devices are among consumers’ main apprehensions with the bourgeoning category. In fact, 82 percent of respondents were worried that wearable technology would invade their privacy and 86 percent expressed concern that wearables would make them more vulnerable to security breaches.

That said, 53 percent of millennials and 54 percent of early adopters say they are excited about the future of wearable tech. Among the top three potential benefits:

  1. Improved safety: Ninety percent of consumers expressed that the ability for parents to keep children safe via wearable technology is important.
  2. Healthier living: More than 80 percent of consumers listed eating healthier, exercising smarter and accessing more convenient medical care as important benefits of wearable technology.
  3. Simplicity and ease of use: Eighty-three of respondents cited simplification and improved ease of technology as a key benefit of wearable technology.

And for wearable technology to be most valuable to the consumer, it needs to embrace Internet of Things opportunities; transform big data into super data that not only culls, but also interprets information to deliver insights; and take a human-centered design approach, creating a simplified user experience and an easier means to achieve goals.

“Businesses must evolve their existing mobile-first strategy to now include the wearable revolution and deliver perceived value to the consumer in an experiential manner,” said Deborah Bothun, PwC’s U.S. advisory entertainment, media & communications leader. “Relevance is the baseline, but then there is a consumer list of requirements to enable interaction with the brand in a mobile and wearable environment.”

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Black Book Loyalty Survey: Nurses Are Very Dissatisfied with EHRs

Dissatisfaction with inpatient electronic health record systems among nurses has escalated to an all time high of 92 percent, according to the Q3 2014 Black Book Loyalty survey results to be published later this month. Disruption in productivity and workflow has also negatively influenced job dissatisfaction according to nurses in 84 percent of US hospitals. Eighty-five percent of nurses state they are struggling with continually flawed EHR systems and 88 percent blame financial administrators and CIOs for selecting low performance systems based on EHR pricing, government incentives and cutting corners at the expense of quality of care.

Eighty-four percent of nursing administrators in not-for-profit hospitals, and 97 percent of nursing administrators in for-profit hospitals confirm that the impact on nurses’ workloads including the efficient flow of direct patient care duties were not considered highly enough in their administration’s final EHR selection decision.

Black Book polled nearly 14,000 licensed registered nurses from forty states, all utilizing implemented hospital EHRs over the last six months. Survey respondents also ranked the vendor performance of 19 inpatient EHR systems from a nursing satisfaction perspective.

“Although the inpatient EHR replacement frenzy has calmed temporarily, the frustration from nursing EHR users has increased exponentially,” said Doug Brown, managing partner of the survey firm Black Book Market Research. “The meaningful use financial incentives for hospitals have many IT departments scurrying to implement these EHR’s without consulting direct care nurses, according to the majority of those polled by Black Book.”

Insights include:

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Health IT Infographic: Evolution of the Electronic Health Record

I’m a huge fan of infographics. I think they provide simple and very easy to understand explanations of often difficult to comprehend subjects, like health IT. The following health IT infographic shows the evolution of the electronic health record since 2009 when they really started to gain attention. One of the things I particularly like about this image is that it defines the difference between EMRs and EHRs, something that is often confused, which is a huge pet peeve of mine.

What’s somewhat interesting about the information here, too, is that large, teaching hospitals utilize EHRs more than other organizations. Ironically, in the past, it’s been reported and much discussed that teaching hospitals don’t actually spend much time teaching student how the use the electronic health records.

Also, the bigger the practice, the more likely they are to have an EHR. This suggests that size does matter.

There’s some other good info buried in the following piece. Take a look; I look forward to your feedback.

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Health IT Thought Leader Highlight: Joanne Rohde, CEO and founder, Axial Exchange

Joanne Rhode
Joanne Rhode

Joanne Rohde is the chief executive officer and co-founder of Axial Exchange. She brings 30 years of experience to her role and has grown companies using “disruptive business models.” Prior to Axial Exchange, she served as the COO and director of health IT strategy at Red Hat, as well as was the CIO of UBS Investment Banking IT. She’s passionate about healthcare because it’s personal; healthcare is a personal business and with the advent of patient engagement, healthcare is even more so personal than its ever been.

Here she discusses the reasoning for her venturing into to healthcare and Axial’s creation, the company’s mission, what “patient engagement” is to her, how “patient engagement” is changing healthcare and Axial’s solution set. Finally, she addresses what she feels are the most pressing issues facing the healthcare as a whole. Her perspectives are deeply insightful; the following is well worth the read.

Can you tell us about yourself and your background prior to starting Axial Exchange? Why healthcare?

I spent most of my career in finance and technology. If I had a personal tagline, it would be that I like to build disruptive businesses in old industries. I did this in finance, with a company called O’Connor and Associates, which brought derivatives and computers to the financial industry when derivatives were still used to hedge real transactions. Then at Red Hat, we brought the benefits of open source to the enterprise, revolutionizing the software industry. Healthcare is one of the most inefficient industries in our country, and it affects every one of us. It is ripe for disruption.

What was your motivation in starting Axial Exchange? Perhaps you can tell me more about your entrepreneurial spirit and journey. Do you have other plans for new business lines in the works presently?

I was COO of a rapidly growing global technology company, Red Hat, when I became ill. Over the course of two years I became too sick to walk up a flight of stairs. I was in constant pain, and couldn’t speak properly. It took two years and 10 doctors to properly diagnose me. As I went from doctor to doctor, it became clear that I was starting over with each doctor — they couldn’t share information, and that lack of information sharing made it difficult for them and for me. It was also apparent that when I would go into their offices, they’d take tests and check symptoms, but they were point-in-time analysis — if I had a bad situation a week prior, it wouldn’t be captured. It occurred to me that my story was in part every American’s story and the current system frustrated both doctors and patients alike.

We are just at the beginning of what we can do to improve the patient-doctor experience. The rapid advances of wearable devices is our current area of focus. We want patients to understand their own health patterns, and to securely share that key biometric information with their physicians so each appointment can be fact-based, not “recall” based. Our next area of focus is real-time case management. What if you could get in touch with a recently released cardiac patient precisely when they were at the most risk instead of waiting for a crisis that lands them back in the hospital? These kind of timely, specific interventions can be a reality with the integration of our application back to the care managers.

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CMS’ Pioneer ACO Program: Results to Date and Changes Ahead

Ken Perez
Ken Perez

Guest post by Ken Perez, vice president of healthcare policy, Omnicell.

The recent flurry of upsets in college football has caused pundits and fans of the sport to do a mid-season recalibration of their projections for their respective teams. Many of the pre-season favorites — selected just seven or eight weeks ago — are no longer in the running for the national championship, others are plugging along pretty much in line with expectations, and a number of “Cinderella” teams have emerged. All teams, no matter how well they have done thus far, will need to make adjustments in the second half of the season.

In like manner, with recent developments and disclosures about CMS’ Pioneer ACO Model, it’s time to do a kind of mid-season recalibration and speculate a bit about needed adjustments to the program.

In August and September, four hospital systems — Sharp HealthCare, a five-hospital system in San Diego, Calif.; Franciscan Alliance in central Indiana; Genesys PHO in Flint, Mich.; and Renaissance Health Network in Pennsylvania — dropped out of the Pioneer ACO Program. With those departures and nine that were previously announced, the number of Pioneers has dropped by 41 percent, from 32 original participants to 19. It should be noted, however, that the majority of the ACOs that have left the program have transferred to the less challenging Medicare Shared Savings Program (MSSP).

On August 6, CMS posted 879 pages of public comments received in response to the CMS Innovation Center’s December 2013 request for information that solicited input on the Pioneer ACO Model as well as new ACO models.

On October 8, CMS released detailed quality and financial data by ACO for the first two years of the Pioneer Program. With regard to quality performance, average quality scores for the Pioneers improved by 19 percent year-to-year, with improved performance on 28 of 33 measures (85 percent) between the first and second year.

Financially, in year one of the program, 13 of the Pioneers (41 percent) met or beat their expenditure benchmarks, qualifying for shared savings and garnering an average of $5.9 million, with the amounts received ranging widely. One Pioneer had to pay CMS a shared loss of $2.6 million, and the remaining 18 ACOs either did not earn shared savings or did not owe CMS money because of  losses.

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IT Jobs with the Highest Pay and Fastest Growth

The following infographic from Staff.com is interesting, outlining IT Jobs with the highest pay and fastest growth. Though it’s not specific to health IT jobs, it it worth a look to see how the IT job market is moving. As is expcted, mobile app development is the hottest market sector now and there are not enough folks to fill them.

Median salary for a IT staffer is about $90,000.

Cloud is the fastest growing sector with nearly two million jobs worldwide going unfilled in 2012. More than 65 percent of all enterprise organizations expected to add some sort of cloud service as of then and the numbers are likely increasing.

Finally, if you’re in IT for the money, work your way into management – about $110,000 annual salary – or a developer with an average annual salary of about $95,000.

Also, want to see how you compare to other IT workers around the world: There a nice graphic below outlining the salary disaparity globally. Think the US pays the most? You’d be bloody wrong! No even the top two, mate.

Staff.com - IT Jobs with the Highest Pay and Fastest Growth Infographic

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CHIME: Healthcare IT Leaders Embrace Federal Interoperability Plans

The College of Healthcare Information Management Executives released the following statement in support of embracing federal interoperability plans:

The federal government’s top health IT advisers recently made recommendations on how public and private stakeholders should progress toward interoperability in healthcare. Leaders from the College of Healthcare Information Management Executives (CHIME) and Health Level Seven International (HL7) embraced the recommendations of the JASON Task Force, calling them a significant step forward in achieving the promise of information technology in healthcare. CHIME and HL7 also highlighted the need to incorporate critical enhancements to standards currently under development for meaningful use Stage 3.

During a joint meeting of the Health IT Standards and Health IT Policy Committees, federal officials discussed new details regarding a national interoperability roadmap and outlined concrete recommendations meant to improve the appropriate access and use of health data. The JASON Task Force said that a solid foundation for interoperability should utilize public APIs, advance modern communications standards, such as HL7′s Fast Healthcare Interoperability Resources (FHIR), and use meaningful use Stage 3 as a pivot point to initiate this transition.

FHIR is a simple-to-use format that can improve interoperability for a range of technologies, including EHRs, patient-centric solutions and mobile applications. A next generation standards framework created by HL7, FHIR combines the best features of HL7′s Version 2, Version 3 and CDA product lines while leveraging the latest web standards and applying a tight focus on implementability.

“Today’s discussion and the recommendations of the JASON Task Force represent an evolution in thinking,” said CHIME president and CEO Russell P. Branzell, FCHIME, CHCIO. “The updated roadmap and the recommendations put forth by the JASON Task Force incorporate a tremendous amount of stakeholder input and articulate the challenges facing our industry much more completely than previous efforts.”

“The prioritization of standards-based interoperability and a commitment to long-term policymaking will enable healthcare to benefit from information technology in very tangible ways,” said Charles Jaffe, MD, PhD CEO of HL7.

CHIME and HL7 believe important recommendations were accepted by the full Health IT Standards and Health IT Policy Committees. HL7 and CHIME also support allowing time to make meaningful use Stage 3 more impactful with the inclusion of key standards that are still under development. “There remains a disconnect between artificial government timelines and the realities of standards and technology development,” Branzell said. “This highlights a principle concern with how health IT policy is created, adopted and implemented at the federal level.”

CHIME and HL7 are committed to collaboration in the advancement of health IT initiatives such as FHIR and support government efforts on the interoperability roadmap.

CHIME is an executive organization dedicated to serving chief information officers and other senior healthcare IT leaders. With more than 1,400 CIO members and more than 140 healthcare IT vendors and professional services firms, CHIME provides an interactive environment enabling senior professional and industry leaders to collaborate; exchange best practices; address professional development needs; and advocate the effective use of information management to improve the health and healthcare in the communities they serve.

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Health IT Leaders Not Fully Prepared to Leverage FutureCare Technologies to Optimize their EHR

MeriTalk, a public-private partnership focused on improving the outcomes of health and government IT, announces the results of its new study, “FutureCare:  Cloud, Big Data, Mobile, and Social Optimize the EMR.” The report, sponsored by EMC Corporation, explores how FutureCare-enabling technologies — cloud, big data, mobile and social — are driving profound change and how deployment of these tools can help optimize electronic health records for improved patient care coordination.

The report purports to reveal that while many providers have implemented or plan to implement these technologies in the next two years, 96 percent of healthcare organizations say their infrastructure is not fully prepared for the evolution of their EHR today.

Health IT leaders have started to adopt FutureCare technologies. Two-thirds of healthcare providers run EHR applications in the cloud, with the majority currently using private cloud models (49 percent), followed by hybrid and public clouds (35 percent).

Healthcare providers are also using big data and analytics in conjunction with their EHR with 50 percent saying big data is helping them to reduce re-admissions and track and evaluate patient outcomes more effectively. Providers are also using big data to conduct cost/benefit analysis to reduce project risk (46 percent), manage clinical and IT staffing levels (38 percent) and prescribe preventive care (24 percent).

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Report: Health IT Sees Nearly $1 Billion in VC Funding in Q3 2014

Mercom Capital Group, a global communications and consulting firm, releases a new report depicting VC funding and mergers and acquisitions activity in the healthcare IT third quarter 2014. According to the report, venture capital funding in the sector came to $956 million raised in 212 deals globally, a decline of 46 percent in terms of dollars compared to the massive $1.8 billion in 161 deals raised in Q2 2014, a rare quarter. Q3 2014 was still the second highest quarter for VC funding since 2010, though, and total VC funding year-to-date is $3.6 billion.

The quarter was dominated by more than 100 funding deals of less than $2 million. There were 252 investors that participated in the quarter including angels, VCs, private equity and corporate VCs. The quarter also included 12 accelerators/incubators.

“Healthcare IT saw another big fundraising quarter in Q3 with almost $1 billion raised. Companies from countries outside of the United States, accounted for a record 21 percent share of the funding. While consumer-centric companies attracted the majority of the funding this quarter, M&A has been a different story with the majority of the deals involving practice-focused companies,” said Raj Prabhu, CEO and co-founder of Mercom Capital Group.

Consumer-focused technologies received 65 percent of all VC investments, with $623 million in 140 deals compared to $678 million in 100 deals in Q2 2014. Areas that received the most funding under this category were mobile health with $345 million in 82 deals followed by telehealth, which had its best quarter, with $101 million in 16 deals; personal health with $85 million in 24 deals; social with $70 million in three deals; and scheduling, rating and shopping with $23 million in 15 deals.

Practice-centric companies received $333 million in 72 deals in the third quarter of 2014, compared to $1.1 billion in 61 deals in Q2. Under this category, the areas that received the most funding were revenue cycle management with $75 million in eight deals, and data analytics with $71 million in 19 deals.

The top five VC funding deals in Q3 2014 were the $70 million raise by DXY (Ting Ting Group), an online healthcare community for medical institutions and healthcare providers in China, from Tencent Holdings Limited, a provider of comprehensive internet services in China, followed by the $52 million raise by Proteus Digital Health, a developer of products and services integrating medicines with ingestible sensors, wearable sensors, mobile and cloud computing.

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CMS Makes Substantial Investment in Rural ACOs

The Centers for Medicare & Medicaid Services (CMS) announces the availability of a new initiative for Accountable Care Organizations (ACOs) participating in the Medicare Shared Savings Program. The new ACO Investment Model is designed to bring these efforts to to rural and underserved areas by providing up to $114 million in upfront investments to up to 75 ACOs across the country.

The ACO Investment Model will give Medicare Accountable Care Organizations more flexibility in setting quality and financial goals, while giving them greater accountability for delivering quality care efficiently, said CMS administrator Marilyn Tavenner.

“We are working with these organizations to make necessary investments that encourage doctors, hospitals and other health care providers to work together to better coordinate care and keep people healthy,” Tavennaer said.

Through its Innovation Center, CMS will provide up front investments in infrastructure and redesigned care process to help eligible ACOs continue to provide higher quality care. This will help increase the number of beneficiaries – regardless of geographic location – that can benefit from lower costs and improved health care through Medicare ACOs.

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How the 2014 Meaningful Use Final Rule is Playing Out in the Field

Tom Lee, Founder and CEO, SA Ignite
Tom Lee

Guest post by Tom S. Lee, Ph.D., CEO & Founder, SA Ignite.

If the few years since the onset of meaningful use haven’t been proof enough, the speed and unpredictability of regulatory change in the last five months has cemented our field’s status as truly not-for-the-feint-of-heart.

Yesteryear’s glacial rate of change in healthcare IT regulation is nowhere to be seen. May 2014 brought both a CMS reset of the ICD-10 transition deadline to October 1, 2015, and a proposed meaningful use rule to enable the use of 2011 edition certified EHR technology (CEHRT) to meet compliance in 2014. The summer then ended with the August 29th finalization of the 2014 meaningful use final rule, the ensuing disappointment that the mandated start of Stage 2 was not delayed and then the swift Congressional response in the form of the September 15th proposed Flex-IT Act to introduce quarterly meaningful use reporting for 2015; enough to spin heads more than once around.

What’s happened in the field since the publication of the final rule among provider organizations bring the phrase “threading the needle” to mind. To further illustrate, we have culled some sample issues from our client base of more than 8,000 providers, across more than 15 EHR brands, and representing numerous combinations of meaningful use stage, payment year and program. These issues, none of which yet have universal and clean solutions, span three areas for provider organizations as seen in the field: 1) properly adhering to the requirements of the final rule, 2) working within the constraints of what EHR vendors can deliver per the final rule’s timeline, and 3) redirecting or pausing organizational momentum for change on short notice.

Regarding the first consideration, note that the final rule requires that an organization attest that it is “not able to fully implement” 2014 Edition technology because of “delays in 2014 Edition CEHRT availability.” Although the rule outlines what does not meet this eligibility test, provider organizations have a persistent question about what documentation and conditions are sufficient to satisfy the test.

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Health IT Startup: Wellframe

Jacob Sattelmair
Jacob Sattelmair, CEO, Wellframe

Wellframe delivers a mobile experience featuring a secure two-way communication channel to connect patients with care providers. The company also offers a mobile data collection system that is, cloud-hosted and scalable to any number of users. Wellframe’s artificial intelligence engine for health state modeling, prediction and dynamic clinical protocol optimization uses data from a patient’s interaction with the care plans to optimize the system, and the company has developed a lightweight cloud-hosted care management EHR that has been successfully integrated into clinical workflows.

Elevator pitch

Wellframe’s mobile platform for care management and patient engagement extends therapeutic relationships to promote patient adherence and improve financial outcomes for health plans and systems.

Product/service description

Wellframe enables organizations to extend the reach of their existing care management services, while providing a higher quality of care to members and improving patient outcomes. Wellframe’s intelligent system engages high-risk patients and creates a personalized patient experience, which is delivered in a simple daily health check-list via mobile technology.

Wellframe has demonstrated success working with the health system’s most socially and medically complex —and costly— patients. These are the individuals for whom payers and providers most desperately need additional insights. The insights gleaned from the Wellframe platform enable clinicians and care managers to better manage their patients’ health and keep them engaged in their care. Wellframe amplifies rather than replaces therapeutic relationships and is re-engineering an antiquated market by using mobile technology to put a care manager in every patient’s pocket.

Foundersstory

The Wellframe founding team is comprised of individuals with a diverse set of skills and whose backgrounds include clinical medicine, public health, systems engineering, data science and consumer engagement. By leveraging their different areas of expertise, the founding team was able to identify a gap in the way care is delivered in the US.

The CEO, Jacob Sattelmair, who is an epidemiologist by training, was focused on using technology to engage people around managing their own health. The chief medical officer, Dr. Trishan Panch, who is a primary care physician and a lecturer at MIT, had been focused on using technology to reengineer care delivery and lower cost settings. Vinnie Ramesh and Archit Bhise are both MIT-trained computer scientists who were researching new ways to utilize low cost technology to improve access to healthcare.

Utilizing and merging their diverse backgrounds, the team developed the idea behind Wellframe: An effective solution to re-engineer care delivery.

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Are ACOs the Future of Healthcare?

Ron Vatalaro, MBA
Ron Vatalaro

Guest post by Ron Vatalaro, who works at Bisk Education with the University of South Florida Morsani College of Medicine. He writes about health informatics.

The Affordable Care Act supports healthcare providers in reducing costs and improving efficiency while delivering quality care. Accountable care organizations (ACOs) achieve these goals by enabling physicians, hospitals and other healthcare providers to create networks and share responsibility to deliver care to Medicare and other patients.

At the heart of the ACO model are three core principles:

  • ACOs are provider-led organizations with a strong primary care base, and collective responsibility for quality and per capita costs.
  • ACO payments are linked to improvements in quality that also reduce costs.
  • Performance measures that support improvement are sophisticated and reliable, and demonstrate that savings are achieved through improvements in care.

Joining an ACO is voluntary, but the federal government encourages participation to reduce unnecessary or duplicated services, prevent errors and keep patients healthier. When providers successfully coordinate services to meet a long list of quality measures, they become eligible for bonuses.

The Current Environmment

Medicare offers several ACO programs, including the Medicare Shared Savings Program, the Advance Payment ACO Model and the Pioneer ACO Model, but many other public and private models exist. Some are sponsored by physicians groups, while nonprofit organizations, hospital systems and health insurers sponsor others. The Pioneer Model was designed for early adopters of coordinated care, and is no longer accepting new members.

To date, more than 600 public and private ACOs have formed; in 2012, the first year of the program, they generated $87.6 million in gross savings. Government support is spurring considerable growth, and ACOs could well become the dominant model in healthcare.

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