By VINCE KURAITIS & LESLIE KELLY HALL
Among many healthcare providers, it’s been long-standing conventional wisdom (CW) that hoarding patient data is an effective business strategy to lock-in patients — “He who holds the data, wins”. However…we’ve never seen any evidence that this actually works…have you?
We’re here to challenge CW. In this article we’ll explore the rationale of “hoarding as business strategy”, review evidence suggesting it’s still prevalent, and suggest 7 reasons why we believe it’s a lousy business strategy:
- Data Hoarding Doesn’t Work — It Doesn’t Lock-In Patients or Build Affinity
- Convenience is King in Patient Selection of Providers
- Loyalty is Declining, Shopping is Increasing
- Providers Have a Decreasingly Small “Share” of Patient Data
- Providers Don’t Want to Become a Lightning Rod in the “Techlash” Backlash
- Hoarding Works Against Public Policy and the Law
- Providers, Don’t Fly Blind with Value-Based Care
In the video below, Dr. Harlan Krumholz of Yale University School of Medicine capsulizes the rationale of hoarding as business strategy.
We encourage you to take a minute to listen to Dr. Krumholz, but if you’re in a hurry we’ve abstracted the most relevant portions of his comments:
“The leader of a very major healthcare system said this to me confidentially on the phone… ‘why would we want to make it easy for people to get their health data…we want to keep the patients with us so why wouldn’t we want to make it just a little more difficult for them to leave.’ …I couldn’t believe it a physician health care provider professional explaining to me the philosophy of that health system.”
Health care data has been viewed as a competitive asset by many health care providers. The CW among many providers over the past several decades has been that hoarding patient information locks-in patients to specific care providers and deters them from going to competitors. CW adds that data also can lock-in independent physicians and other care providers.
Quantifying the magnitude of hoarding is challenging. It’s not exactly the type of guiding vision that senior management necessarily would broadcast broadly and loudly, or even acknowledge publicly. It is likely that many constituents — e.g., clinicians, local press, regulators, employees — would find the strategy to be odious. It’s more likely that senior management would publicly deny that they embrace hoarding as business strategy.
Where it does exist it’s possible to exist primarily (or solely) at the C-level of provider organizations. It might not even be an explicit strategy — it could be implicit — something that the CEO, CIO and/or CFO hold in their heart-of-hearts or understand with a wink-and-a-nod.
Hoarding also comes in many shades and flavors, many of which might be more paternalistic or cautious than malicious. For example, one organization’s view of “stewardship” might be considered hoarding by another that wants the data. Both are right.
So how prevalent is hoarding? We have to rely on indirect evidence — and there is plenty of that available.
A Center for Studying Health System Change analysis examined barriers to health information sharing. In interviews with health system executives, they found that “Hospitals’ greatest concern in weighing the costs and benefits of participation in [a health information exchange (HIE)] was losing competitive advantage by relinquishing control of ‘their’ data. They viewed clinical data as a key strategic asset, tying physicians and patients to their organizations.” (emphasis added)
A Robert Wood Johnson Foundation Study asked HIE organization respondents to characterize the degree to which potential barriers slowed their development. 83% listed “concerns about competitive position” and 78% listed “lack of stakeholder [provider] interest”.
A 2017 study by Julia Adler-Milstein and Eric Pfeifer examined the prevalence of information blocking. HIE respondents answered that 50% of EHR vendors routinely engaged in information blocking and that another 33% did so occasionally; they also answered that 25% of hospitals/health systems engaged in information blocking routinely and another 34% occasionally.
A few qualifiers. First, we don’t mean to imply that hoarding as business strategy is the only reason that’s limited appropriate exchange of patient health data; there are many other factors at play. To name a few: a fear of violating HIPAA regulations; a lack of technical standards; privacy/security concerns; technology and infrastructure gaps and others.
Second, we also understand that patient retention/loyalty is an important and relevant strategic initiative in most health care organizations today. It’s one of few strategies that make sense in BOTH the old world of fee-for-service payments and the new world of value-based payments. There are many viable tools and tactics to increase patient loyalty and to improve clinical care through care coordination — but “hoarding as business strategy” isn’t one of them.
Finally, the specific focus of this article is to explain why hoarding is a lousy business strategy. We also strongly believe that there are many positive reasons why appropriate sharing of patient data is a powerful and effective business strategy – but that’s a separate article.
7 Reasons: Hoarding Patient Data is NOT an Effective Business Strategy
Let’s dive in.
1) Data Hoarding Doesn’t Work — It Doesn’t Lock-In Patients or Build Affinity.
Hoarding as business strategy assumes a provider view that they’re running a tight ship — that patients are highly loyal to care providers and stay within their confines.
That view would be wrong. The reality is that care provider networks are highly “leaky” and that patients readily cross over among 2 or more health systems. This phenomenon has been studied extensively.
Some of the most extensive data on leakage and crossover (patients registered at 2 or more providers) come from public Health Information Exchanges. Maine HealthInfoNet documents their current crossover rate as being 61%. In two-hospital towns like Bangor and Lewiston, HealthInfoNet’s system has shown as much as 75% patient crossover.
A study of Indiana ER visits found that more than 40% of emergency visits during the one-year study period were for patients having data at multiple institutions. That rose to 60% when multiple years of data were included.
A Massachusetts study found that significant leakage takes place even within captive referral networks. One health insurer’s referral data showed that “only 35-45% of adult inpatient care, as measured by revenue, goes to the partner hospital”.
A 2018 analysis in the American Journal of Managed Care examined specialty referral leakage in Medicare accountable care organizations (ACOs). The researchers found leakage rates of 61-72% among the most specialty-oriented ACOs (Figure 2).
The take away here is that patient lock-in strategies just haven’t worked. The natural state is for patients to go pretty much wherever they want or wherever urgency demands.
2) “Convenience is King” in Patient Selection of Providers.
Chances are you’ve seen a billboard like the one below.
Even as the hospital C-suite might be thinking “Hoarding is our business strategy”, the hospital marketing department groks that patients overwhelmingly are motivated by convenience — that they will select a specific provider simply to save a few minutes time.
Patients DO NOT think: “I want to go to ACME ER because they have all my data – they know me”.
Patients DO think: “I’ll go to ABC ER because they have a short wait time.”
The Advisory Board (AB) provides consulting, research and technology to hospitals and delivery systems. The AB asked 4,000 consumers about their on-demand care preferences and published a list of the “Top Ten Preferred Primary Care Clinic Attributes”. 6 of the top 10 attributes were related to access and convenience.
The element of whether a provider has access to a patient’s data (whether “they know me”) didn’t even make the list. They concluded that “Convenience is king”.
3) Loyalty is Declining, Shopping is Increasing.
The Advisory Board also measured patient loyalty to their primary care physicians. They surveyed 1,843 patients who had a primary care visit within the past year and found:
- Only 53% would stay with their current PCP for the next 12 months
- Only 9% of respondents would follow their current PCP if they changed locations
- Only 36% would recommend their PCP to family and friends
- Consumers were more likely to promote Sprint, Apple, Amazon, and Orbits than their PCP
The UnitedHealthcare 2018 Consumer Sentiment Survey found that 36% of respondents had used the internet or mobile apps to comparison shop for health care services — a 257% increase from 2012.
Many trends in the health care marketplace point to further decreases in patient loyalty and increased prevalence of consumers’ shopping for care:
- The greater financial burden being shifted to patients, e.g., a report from Americas Health Insurance Plans documented that the number of people enrolled in HSA-Qualified High Deductible health plans grew from 1 million in 2005 to 22 million in 2017.
- Patients have more choices, providers have more competition — the growth of retail clinics, the entry of tech companies (Amazon, Apple…) and retailers (Walmart, CVS…), funding for new digital health companies.
- Increasing availability and relevance of health care quality and pricing information.
- Improvements in patient digital tools and apps.
- Consistently poor patient experience drives patients to seek alternatives.
4) Providers Have a Decreasingly Small “Share” of Patient Data.
Providers might think that they have the corner on patient’s health data, but that mindset is increasingly inaccurate. They have a sliver of a patient’s data.
The graphic below from Travis May, CEO of Datavant, illustrates the scale and distributed nature of health data. Note that provider data in EHRs is represented only by the box in the upper left corner.
A providers “share” of a patient’s health data is declining over time. New and better sources of data are defining a patient’s experience of health and care, e.g., patient-generated health data (PGHD), data from remote monitoring devices, genetic data, data relating to social determinants of health, etc.
5) Providers Don’t Want to Become a Lightning Rod in the “Techlash” Backlash.
A recent article in the New York Times describes “the year’s biggest overarching tech narrative: the ‘techlash’ against companies like Facebook and Google over issues like privacy, data protection and antitrust concerns.”
One effect of techlash is that it is sensitizing patients to the notion that patients themselves should be in control of health data, not some 3rd party.
To-date, techlash has affected tech companies, but there’s great potential for techlash to spill over to health care organizations that treat patient data as “their” asset, not patients’ asset.
Does this sound far-fetched? Consider what’s happened at Memorial Sloan Kettering Cancer Center over just the past few weeks. Administrators acted as-if the data from 25 million patient tissue slides was “their” asset to sell to a private company…and now they are the focus of a scandal investigation and front page news.
6) Hoarding Works Against Public Policy and the Law.
The last item spelled out the dangers of providers’ being called out in the court of public opinion. Providers should also be increasingly concerned about being called out in a court of law.
Many recent legislative and policy initiatives are emphasizing patients’ rights relating to their health information:
- Patients’ right to access their health records under HIPAA
- Information blocking restrictions in the 21st Century Cures Act
- The MyHealtheData initiative, which “aims to empower patients by ensuring that they control their healthcare data and can decide how their data is going to be used.
Health and Human Services Secretary Alex Azar, spelled out four areas of emphasis toward value based transformation. Item #1 on his list was “giving consumers greater control over health information through interoperable and accessible health information technology”.
7) Providers, Don’t Fly Blind with Value Based Care.
There are many ways in which information exchange will be necessary to support value based care, but we’d like to focus on one in particular.
As financial risk increasingly is shifted to care providers, providers will be responsible for the cost and quality of care provided by out-of-network care providers.
Let’s recall some of the data we presented under #1. In the last example, researchers documented that 61-72% of ACO specialty referrals went to out-of-network providers. If data is hoarded and not shared appropriately with these out-of-network providers, two things happen:
- Out-of-network care providers fly blind — they don’t have the best data to care for patients
- At-risk care providers fly blind — they can’t assure that patients’ get appropriate care and they undermine their own economic self-interests
That’s flying blind for roughly 2/3 of referred patients!!
The bases of competition in healthcare are shifting – away from competing based on misguided attempts to lock-in patients and providers – and toward competing based on providing care that’s high quality, low cost, and a superior patient experience.
Sometimes conventional wisdom goes stale…or was never wise in the first place.
Vince Kuraitis, JD/MBA (@VinceKuraitis) is an independent healthcare consultant with over 30 years’ experience across 150+ healthcare organizations.
Leslie Kelly Hall (@lesliekellyhall) is a nationally recognized leader in patient engagement advocating for patients in health IT and beyond.