Optum takes health care to the cloud

  • Article by: JACKIE CROSBY
  • Star Tribune
  • February 14, 2012 - 5:38 AM

UnitedHealth Group's health services division, Optum, hopes to do for the complex and fragmented health care system what Apple has done for all manner of information that consumers need.

The idea is to get health care data out of scattered hospitals, doctors' offices and insurance claims departments and move it to the cloud, an Internet-based platform that would let doctors and patients get access to all the information they need through one website.

The bold business strategy is expected to be announced Tuesday, when the Eden Prairie-based company launches a secure, cloud-based environment that will offer access to its 700 technology-based products.

"We think we can make technology less visible and therefore bring simplicity to a very complicated world," said Andy Slavitt, Optum's executive group VP, who is leading the initiative. He described the strategy, a year in the making, as "very transformative" and one of the most significant things the firm has done.

"We're dropping the bread crumbs because we think this is a more efficient way to operate," he said. "We're in a unique position because we have users already using applications."

Optum sells a host of products, including financial services software that helps hospitals and clinics collect payments, as well as tools for wellness programs and pharmacy benefits management.

The company is partnering with Cisco, EMC, Hewlett-Packard and IBM, big players in the fast growing field of cloud computing. The cloud lets users tap into powerful software systems or databases without having to own and manage the technology.

"The cloud represents a shared investment in information technology that gets at some of the fundamental requirements -- like security, which is absolutely critical when dealing with health care information," said Sean Hogan, vice president of health care delivery for IBM. "For smaller organizations to be able to tap into information technology resources without having to invest in the physical infrastructure is likely to be compelling to many people."

Small physician practices that may not have $80,000 to purchase and maintain a system of electronic medical records would have an opportunity to purchase the technology through Optum's cloud, which would be responsible for maintaining the servers that contain the data.

The platform also would allow health care providers to more easily talk to one another and share patient data, allowing them to do a better job co-ordinating care and researching treatments, especially when their patients are seeing multiple specialists and taking multiple medications.

The Optum cloud promises to improve billing and claims processing by standardizing forms and protocols, company officials said.

Optum's health care cloud also aims to open the door to health care entrepreneurs in the same way that Apple's App Store has been a boon to small software developers.

Technology presents a "huge opportunity" to trim costs and to help doctors get more relevant information and provide better care, said Dr. Penny Wheeler, chief clinical officer of Minneapolis-based Allina Health.

Allina already is starting to use claims data to roughly predict patients' risk for being readmitted, she said. Marrying that data with clinic records more than doubles the accuracy.

The potential of cloud-based IT to tap into multiple sources of information -- from whether patients filled their prescriptions to whether they went to the emergency room without their doctor's knowledge -- holds even more potential.

"For us as an organization we know those tools will be needed," she said. "We're trying to determine what do we build, what do we buy and when are we going to partner with organizations that have more experience in this area."

Optum's cloud will work off of a single dashboard page, with separate entry points for health care providers, consumers and developers. Many clients will get moved to the cloud and not even know it.

The company's products are used by 6,200 hospitals, 2,000 health plans, 64,000 pharmacies, 250,000 health professionals and more than 60 million people.

By virtue of Optum's size, the move will have significance in the health technology marketplace. The unit had $28.7 billion in revenue in 2011.

"United has been a firm that has grown by acquisition," said Steve Parente, health finance professor at the University of Minnesota's Carlson School of Management. "The more things they can take from their acquisitions and put into common platform on a cloud, and have it be unified, that will lend itself to innovation."

UnitedHealth Group talked generally about the initiative at its investor conference in November and during its fourth-quarter earnings conference call last month, but has not predicted its financial impact.

That would be like asking Target to measure the impact of e-commerce on sales, Slavitt said. "You can't say because it becomes a way of doing business," he said.

Jackie Crosby • 612-673-7335

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