Perspective: Taking Commercialization One Step Further — Health Catalyst and Allina Announce Risk-Based Analytics Partnership

Perspective: Taking Commercialization One Step Further — Health Catalyst and Allina Announce Risk-Based Analytics Partnership

This IDC Health Insights Perspective discusses the growing importance of effective analytics to health system performance in the context of a recent announcement of a risk-based partnership between technology supplier Health Catalyst and Allina Health. As health systems and hospitals throughout the United States seek to bend the cost curve to transform operations and remain profitable under healthcare reform, actionable analytics programs are becoming critical. Yet many health systems have ineffective analytics programs with technology that fails to get installed, fails to create actionable information once installed, or subsequently fails to become a regular part of operational decision making, which is required for an analytics program to succeed at any clinical or financial objective.

The complexity of healthcare delivery processes and organizations and the lack of transparency and alignment with the goals of the health system have made most technology suppliers unwilling to get involved in risk-based relationships tied to operational results. However, that is clearly not the case in the relationship between analytics supplier Health Catalyst and Allina Health. In their January 6, 2015, announcement, Catalyst and Allina indicated they have entered into a relationship valued at over $100 million that will combine partnerships on technology and the commercialization of the health system's intellectual property. The 10-year analytics supplier relationship places 20% of Catalyst's fees at risk, tied to measurable outcomes improvements at Allina. According to Health Catalyst CEO Dan Burton, the relationship will "make the supplier accountable for the results the health system achieves with the technology, not just to drop off technology but to make sure the technology delivers meaningful outcomes." This is one of a growing number of commercialization relationships between suppliers and health systems in the industry but is differentiated by Health Catalyst's willingness to invest itself directly in the risk associated with transformation in healthcare.

Please Note: Extended description available upon request.

In This Perspective
Situation Overview
The Announcement
The Partners
Future Outlook
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