Healthcare Factoids to Power Your Thinking

2. © 2014 Health Catalyst www.healthcatalyst.com Historically, the "Build it and they will come" model was used in almost every vertical during the late 1990s and early 2000s. More than 80% of those IT-directed warehouses took three years to fail, and were replaced by data marts built to purpose by individual business units. In contrast, data warehouses sponsored by business executives exhibited a success rate of greater than 70%. Source: Top Actions for Healthcare Delivery Organization CIOs, 2014: Avoid 25 Years of Mistakes in Enterprise Data Warehousing. Gartner. Shaffer, Vi; Beyer, Mark A. February 10, 2014. http://www.gartner.com/document/2664433

3. © 2014 Health Catalyst www.healthcatalyst.com In 2009, the Institute of Medicine estimated that there was $765 billion in avoidable costs in US Health Care System. Source: Institute of Medicine http://resources.iom.edu/widgets/vsrt/hea lthcare-waste.html

4. © 2014 Health Catalyst www.healthcatalyst.com It is estimated that more than three million preventable serious adverse events occur in hospitals annually, with over half attributable to hospital-acquired infections and adverse drug events. Source: Better U.S. Health Care at Lower Cost , 2013. Issues in Science and Technology. Milstein, Arnold; Darling, Helen. http://issues.org/26-2/milstein/

5. © 2014 Health Catalyst www.healthcatalyst.com Readmissions added $41.3 billion in hospital costs in 2011 and 58% of this costs stemmed from Medicare patients. Source: Statistical Brief #172. Agency For Healthcare Research and Quality, April 2014 http://www.hcup-us.ahrq.gov/reports/statbriefs/sb172-Conditions-Readmissions-Payer.pdf

6. © 2014 Health Catalyst www.healthcatalyst.com 53% of physicians said they would order an unnecessary medical test or procedure if the patient insisted. Source: American Board of Internal Medicine Foundation, Choosing Wisely Survey, 2014. http://www.choosingwisely.org/survey-physicians-are-aware-that-many-medical-tests-and-procedures-are- unnecessary-see-themselves-as-solution/

7. © 2014 Health Catalyst www.healthcatalyst.com True or false: Physicians who see more than 100 patients per week are more likely to order a test even though it might not be necessary compared to those who saw fewer than 100 patients per week. Answer: True. Source: American Board of Internal Medicine Foundation, Choosing Wisely Survey, 2014. http://www.choosingwisely.org/survey-physicians-are-aware-that-many-medical-tests-and-procedures-are- unnecessary-see-themselves-as-solution/

8. © 2014 Health Catalyst www.healthcatalyst.com A new survey of older women in the American Journal of Preventive Medicine finds that sitting for long stretches of time increases the odds of an untimely death. And here’s the kicker: Even women who exercised regularly risked shortening their lifespan if most of their daily hours were sedentary ones. Source: Too Much Sitting Linked to an Early Death, Watson, Stephanie; Executive Editor, Harvard Women’s Health Watch http://www.health.harvard.edu/blog/too-much-sitting-linked -to-an-early-death- 201401297004

9. © 2014 Health Catalyst www.healthcatalyst.com Because of excessive and unnecessary cancer screenings common on patients 65 years and older, an August 2014 JAMA study of 27,404 patients recommends that screenings not be given to those with life expectancies of less than 10 years. Source: Many seniors get unnecessary and potentially harmful cancer tests LeWine, Howard, M.D.; Chief Medical Editor Internet Publishing, Harvard Health Publications http://www.health.harvard.edu/blog/unnecessary-cancer-screening-tests-201408197371

10. © 2014 Health Catalyst www.healthcatalyst.com Heart surgery is being performed today for $1,400 by a JCI accredited organization. Do you know where? Answer: Narayana Health, Bangalore, India Source: From The Heart: Healthcare Transformation From India To The Cayman Islands. Healthcare Analytics Summit, Sept 25th 2014. http://hasummit.com/session/heart-healthcare-transformation-india- cayman-islands/

11. © 2014 Health Catalyst www.healthcatalyst.com In 2012, 47% of deaths were attributed to heart disease and cancer as the two leading causes. Source: FastStats. Centers for Disease Control and Prevention. http://www.cdc.gov/nchs/fastats/deaths.htm

12. © 2014 Health Catalyst www.healthcatalyst.com The under-5 mortality rate worldwide has fallen by 49% since 1990. . . Source: New Data Show Child Mortality Rates Falling Faster Than Ever. World Bank. Sept 16, 2014 http://www.worldbank.org/en/news/press-release/2014/09/16/new-data-child-mortality-rates-falling-faster

13. Image Source: Living on a Dollar a Day: The Lives and Faces of the World’s Poor. Nazario, Thomas A.; 2014 © 2014 Health Catalyst www.healthcatalyst.com $8,233 was spent on healthcare per person in the U.S. in 2012. Worldwide in 2013, the median annual household income was $9,733. Today nearly a billion people still make less than $1 a day. Source: Health Costs: How the U.S. Compares With Other Countries. PBS NewsHour, Kane, Jason; Oct 22, 2012. http://www.pbs.org/newshour/rundown/health-costs- how-the-us-compares-with-other-countries/

14. © 2014 Health Catalyst www.healthcatalyst.com The average median operating margin at hospitals fell 2.2% per a Moody’s investor survey of 448 U.S. hospitals in 2014. Expenses increased at an annual rate of 4.6% Source: Moody's: Not-for-profit hospital margins fall to 2.2%. Advisory Board. April 25, 2014.http://www.advisory.com/daily-briefing/2014/04/25/moodys-not-for-profit-hospital-margins-fall

15. © 2014 Health Catalyst www.healthcatalyst.com In 1970, 7.2% of GDP was spent on healthcare. Pharmaceutical discoveries, legislation allowing strong patent protection, and HMOs were marked changes over the next two decades, contributing to the more than 18% of GDP spent on healthcare today. Source: Health Care Costs: A Primer. The Henry J. Kaiser Family Foundation, May 01, 2012. http://kff.org/health-costs/issue-brief/health-care-costs-a-primer/

16. © 2014 Health Catalyst www.healthcatalyst.com In 2012, 50% of healthcare spending was used to treat just 5% of the population. Source: Health Care Costs: A Primer. The Henry J. Kaiser Family Foundation, May 01, 2012. http://kff.org/health-costs/issue-brief/health-care-costs-a-primer/

17. © 2014 Health Catalyst www.healthcatalyst.com Starting in the 1970’s, cardiac care advances including “clot-buster” drugs, angioplasty, beta-blocker therapy, and stents led to the overall mortality rate from heart attack falling by almost 50% from 1980-2000. Source: Snapshots: How Changes in Medical Technology Affect Health Care Costs. Mar 2, 2007. Kaiser Family Foundation http://kff.org/health-costs/issue-brief/ snapshots-how-changes-in-medical-technology- affect/

18. © 2014 Health Catalyst www.healthcatalyst.com Neonatal advances in the 1990’s helped decrease mortality to one-third its 1950’s level, with an overall increase in life expectancy of about 12 years per low birth weight baby. Source: Snapshots: How Changes in Medical Technology Affect Health Care Costs. Mar 2, 2007. Kaiser Family Foundation http://kff.org/health-costs/issue-brief/ snapshots-how-changes-in-medical-technology- affect/

19. © 2014 Health Catalyst www.healthcatalyst.com A 2005 RAND report suggested EHR’s could save U.S. healthcare $81 billion a year. A 2013 RAND study report told a different story. Evidence of significant savings is scant and there is increasing concern that electronic records have actually added to costs by making it easier to bill more for services. Healthcare spending has risen $800 billion since 2005 report was issued. Source: In Second Look, Few Savings From Digital Health Records. New York Times. Abelson, Reed; Creswell, Julie. January 10, 2013. http://www.nytimes.com/2013/01/11/business/electronic-records- systems-have-not-reduced-health-costs-report-says.html?pagewanted=1&_r=0

20. © 2014 Health Catalyst www.healthcatalyst.com Dr. David J. Brailer, the United States’ first healthcare information czar, said the “colossal strategic error” that occurred (with the EHR roll-out) was a result of the Obama administration’s incentive program. “The vast sum of stimulus money flowing in to health information technology created a ‘race-to-adopt’ mentality – buy the systems today to get government handouts, but figure out how to make them work tomorrow.” Source: In Second Look, Few Savings From Digital Health Records. New York Times. Abelson, Reed; Creswell, Julie. January 10, 2013. http://www.nytimes.com/2013/01/11/business/electronic-records- systems-have-not-reduced-health-costs-report-says.html?pagewanted=1&_r=0

21. © 2014 Health Catalyst www.healthcatalyst.com In 2010, Medicare spent $55 billion for doctor and hospital bills during the last two months of patients’ lives. Source: The Cost of Dying. CBS 60 Minutes. Aug 05, 2010 http://www.cbsnews.com/news/the-cost-of- dying-end-of-life-care/

22. © 2014 Health Catalyst www.healthcatalyst.com Mean annual Medicare expenditures for the last 12 months of life in the elderly rose from $1,924 in 1976 to approximately $23,000 in 1995. Source: Medical Expenditures during the Last Year of Life: Findings from the 1992–1996 Medicare Current Beneficiary Survey. Health Services Research. Hoover, Donald R., Crystal, Stephen, Kumar, Rizie, Sambamoorthi, Usha, Cantor, Joel C. http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1464043/

23. © 2014 Health Catalyst www.healthcatalyst.com The American Journal of Infection Control research suggests that fist bumps should replace hand shakes due to a dramatic decrease in the spread of bacteria. Source: Study: Fist bumps are less germy than handshakes USA Today. Painter, Kim. July 28, 2014 http://www.usatoday.com/story/news/nation/2014/07/28/fistbump-handshake-germ-study/13170587/

24. © 2014 Health Catalyst www.healthcatalyst.com By 2017/2018, current EHR’s will be unrecognizable. By then we expect an emerging crop of new vendors to have successfully challenged the status quo.” Source: Second EHR Land Grab Just Over Horizon Domain Monitor EHR 2.0. Tholemeier, Rob. January 2014. http://www.chilmarkresearch.com/wordpress/wp-content/ uploads/2014/01/EHR_LandGrab_Jan14-Monitor.pdf

25. © 2014 Health Catalyst www.healthcatalyst.com Through 2017, 90% of the information assets from big data analytic efforts will be siloed and unleverageable across multiple business processes. Source: Information Innovation Key Initiative Overview. Gartner. Laney, Douglas. April 22, 2014. http://www.gartner.com/document/2715317

26. © 2014 Health Catalyst www.healthcatalyst.com As of January 2014, only 160 hospitals (out of 5,723 registered in the US) reached HIMSS stage 7, the top of the adoption model measuring hospital’s move to electronic records. Stage 7 organizations are also able to share patient information electronically and have advanced data analytics capabilities. Image Source: HIMSS Analyticshttps://www.himssanalytics.org/emr am/stage7award.aspx Source: CIOs Share 7 Best Practices for Reaching HIMSS Stage 7 Becker’s Hospital Review. Gregg, Helen, January 17, 2014.http://www.beckershospitalreview.com/healthcare-information-technology/ cios-share-7-best-practices-for-reaching-himss-stage-7.html

27. © 2014 Health Catalyst www.healthcatalyst.com A growing number of buyers, 40%, are looking to replace existing EHR systems, up from 30% at the same time last year. Source: EHR Software BuyerView, 2014. Software Advice, Q1 2014 Survey http://www.softwareadvice.com/medical/buyerview/report-2014/

28. © 2014 Health Catalyst www.healthcatalyst.com The average ACO will risk $3.5 million before possible savings. The National Association of ACOs first national survey of the 2012 and 2013 Medicare ACOs Source: The Average ACO Will Risk $3.5 Million Before Any Possible Savings. HIT Consultant, Pennic, Jasmine. January 29, 2014 http://hitconsultant.net/2014/01/29/average-aco-will-risk-3-5-million-possible-savings/

29. © 2014 Health Catalyst www.healthcatalyst.com 22% of physicians surveyed in this year are opting out of or disregarding the meaningful use program. Source: EHR Report: 22% of Physicians are Disregarding Meaningful Use. Healthcare Informatics. Leventhal, Rajiv. July 22, 2014. http://www.healthcare-informatics.com/news-item/ehr-report-22- physicians-are-disregarding-meaningful-use

30. © 2014 Health Catalyst www.healthcatalyst.com Link to original article for a more in-depth discussion. Healthcare Factoids to Power Your Thinking Paul Horstmeier brings 25 years of Fortune 500 and small business operations and general management experience to Health Catalyst. He co-founded HB Ventures and filled senior executive roles at HB Ventures portfolio companies. Within Hewlett-Packard, Mr. Horstmeier launched and grew three different businesses, including co-founding HP's commercial e-commerce business which later expanded to include the management of the data systems and infrastructure for marketing operations across the company. As Vice President of HP.com, he headed up a 700-person organization which was awarded nearly every industry award for quality and innovation during his tenure.