In just a few short months, two major health insurers have upended the health information exchange landscape as they seek to become active players in accountable care organizations while diversifying their business, analysts said.
Insurers get in IT game
Data is seen as key to the success of ACOs
Last week, Aetna announced plans to acquire Medicity, a health information exchange company in Salt Lake City for $500 million. The news came three months after Ingenix, a subsidiary of UnitedHealth Group, said it would acquire Axolotl Corp., a Medicity competitor in San Jose, Calif., for an undisclosed sum.
Medicity’s technology is used by 760 hospitals and 125,000 physicians, according to the company.
Axolotl, by comparison, reaches 200 hospitals and 30,000 physicians, according to Ingenix.
As the federal health reform law places more restrictions on how plans can spend member premiums, major insurers are seeking alternate revenue streams.
What’s more, investing in health information technology companies gives them a leg up in terms of capturing and analyzing patient information.
“The real value of health information exchanges is what you do with that data,” said Lynne Dunbrack, program director for connected health IT strategy at IDC Health Insights.
Medicity’s provider platform, combined with Aetna’s ActiveHealth Management subsidiary, which offers clinical decision support, can give providers a clearer picture of patients’ status and needs. “It’s actually a very nice complement,” Dunbrack said.
Mark Bertolini, Aetna’s CEO and president, said as much when announcing the deal. “This acquisition will enable Aetna to offer a set of convenient, easy-to-access technology solutions for physicians, hospitals and other healthcare providers,” he said in a statement.
Analytics are expected to play an increasingly important role in healthcare. The American Recovery and Reinvestment Act of 2009 allocated $783 million in funding for health information exchanges, and $36.5 billion in incentives to hospitals and physicians to adopt interoperable electronic medical records.
The Patient Protection and Affordable Care Act, along with subsequent CMS actions, are supporting alternative payment models. The formation of accountable care organizations and patient-centered medical homes, for instance, means insurers will be seeking ways to get a foothold into these mostly provider-led initiatives.
“One of the key components of ACOs is the notion of being able to better coordinate care,” Dunbrack said.
“In order to do that, you have to have underlying information that allows you to see what’s happening across the continuum of care,” she said.
How do providers feel about having so much data in the hands of insurers? “I think it can only bring bigger and better things,” said Beth Fredette, chief information officer for Dayton (Ohio) Children’s Medical Center. Dayton Children’s just last week signed with Medicity to power its health information exchange between the hospital, physicians and community partners.
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