UPMC and Health Catalyst have formed a strategic partnership in an effort to measure and analyze the true costs of healthcare services, a process that could become increasingly useful with looming bundled-payment models.
Pittsburgh-based health system and insurer UPMC and Health Catalyst, a data warehousing company based in Salt Lake City, last week announced they are combining UPMC's activity-based cost-management system and Health Catalyst's enterprise data warehouse. Under the agreement, Health Catalyst will license and commercialize the technology, content and analytics developed by UPMC.
UPMC has been working on tools to manage healthcare costs since its board tasked officials with tracking prices on services such as surgery. UPMC came up with a tool comparable to one used in the manufacturing industry, said Robert DeMichiei, UPMC's chief financial officer.
Health Catalyst gathers clinical, operational and financial information from various systems within UPMC, and provides patient-specific costs on a monthly basis. Algorithms developed by UPMC allow its financial analysts to match equipment use, supplies and various clinical activities—such as time in the operating room—to patients. The analytic tool has been live for a year in all of UPMC's Allegheny County hospitals, DeMichiei said, and will be implemented in five additional regional hospitals in March. UPMC can now track what's happening within its service lines, and drive initiatives based on data capabilities not previously possible, he said.
“Unless you have data to understand cost, you can't actually have discussions with physicians,” DeMichiei said.