UPMC and Health Catalyst are teaming up in a strategic partnership to develop a cost management solution that will measure and analyze the true cost of healthcare delivery for each patient. The partnership is the first of its kind that builds upon an activity-based cost management system developed by UPMC for commercial use and Health Catalyst’s Enterprise Data Warehouse (EDW) infrastructure, analytics expertise, and professional services. Financial details of the partnership were not disclosed.
Partnership Details
Under terms of the agreement, Health Catalyst will license UPMC’s technology, content and analytics to develop a market solution that will further enhance UPMC’s cost management programs and possibly to other health systems.
Additionally, UPMC will partner with Health Catalyst to further develop the cost-management program and implement the Health Catalyst Late-Binding™ EDW and Analytics platform to enable more seamless retrieval and aggregation of data from multiple information systems at UPMC. The UPMC employees currently working in cost management have now become Health Catalyst team members.
“Thanks to our ability to compare outcomes and costs across a patient’s entire care experience—and by service line, hospital and physician–UPMC is identifying and adopting best practices that enhance quality while reducing spending, a convergence that is the ‘Holy Grail’ of healthcare,” said Robert DeMichiei, Executive Vice President and Chief Financial Officer of UPMC in an official statement. “This strategic partnership with Health Catalyst will significantly accelerate that effort by leveraging the experience and know-how of both organizations to benefit UPMC’s patients and others across the country.”
Since deploying its cost management tool in 2014 to blend quality data with physician- and patient-specific cost data, UPMC and its physician leadership have been able to drive significant changes in clinician behavior leading to improved care at lower cost. For example, the number of “open” hysterectomies, compared with vaginal or minimally invasive versions of the surgery, has fallen 30 percent across the system, reducing patient complications, lengths of stay, readmissions and costs. In addition, UPMC clinicians are using the cost management tool to assess practice standardization opportunities associated with alternative payment mechanisms, such as the impending Medicare Comprehensive Care for Joint Replacement Program.
UPMC’s costing system models relevant clinical, operational and financial information from multiple information systems at UPMC to provide patient-specific cost on a repeatable, monthly basis. Sophisticated computer modeling tools, along with internally developed algorithms, allow UPMC’s financial analysts to match supplies, blood products, equipment use, and more than 50 clinical activities — such as time in the operating room, intensive care unit or rehabilitation facility — to specific patients. In the past, because of limitations of existing technology, general formulas were applied to account for costs, sometimes leading to imprecise conclusions about specific treatments, service lines or facilities.
The agreement with UPMC also marks Health Catalyst’s third partnership with a major health system following similar agreements with Partners HealthCare and Allina Health.
