"ACO" entries

Solving the Wanamaker problem for health care

Data science and technology give us the tools to revolutionize health care. Now we have to put them to use.

By Tim O’Reilly, Julie Steele, Mike Loukides and Colin Hill

“The best minds of my generation are thinking about how to make people click ads.” — Jeff Hammerbacher, early Facebook employee

“Work on stuff that matters.” — Tim O’Reilly

Doctors in operating room with data

In the early days of the 20th century, department store magnate John Wanamaker famously said, “I know that half of my advertising doesn’t work. The problem is that I don’t know which half.”

The consumer Internet revolution was fueled by a search for the answer to Wanamaker’s question. Google AdWords and the pay-per-click model began the transformation of a business in which advertisers paid for ad impressions into one in which they pay for results. “Cost per thousand impressions” (CPM) was outperformed by “cost per click” (CPC), and a new industry was born. It’s important to understand why CPC outperformed CPM, though. Superficially, it’s because Google was able to track when a user clicked on a link, and was therefore able to bill based on success. But billing based on success doesn’t fundamentally change anything unless you can also change the success rate, and that’s what Google was able to do. By using data to understand each user’s behavior, Google was able to place advertisements that an individual was likely to click. They knew “which half” of their advertising was more likely to be effective, and didn’t bother with the rest.

Since then, data and predictive analytics have driven ever deeper insight into user behavior such that companies like Google, Facebook, Twitter,  and LinkedIn are fundamentally data companies. And data isn’t just transforming the consumer Internet. It is transforming finance, design, and manufacturing — and perhaps most importantly, health care.

How is data science transforming health care? There are many ways in which health care is changing, and needs to change. We’re focusing on one particular issue: the problem Wanamaker described when talking about his advertising. How do you make sure you’re spending money effectively? Is it possible to know what will work in advance?

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Technical requirements for coordinating care in an Accountable Care Organization

Report from the field by Tony McCormick

The concept of an Accountable Care Organization (ACO) reflects modern hopes to improve medicine and cut costs in the health system. Tony McCormick, a pioneer in the integration of health care systems, describes what is needed on the ground to get doctors working together.

Highlights from the full video interview include:

  • What an Accountable Care Organization is. [Discussed at the 00:19 mark]
  • Biggest challenge in forming an ACO. [Discussed at the 01:23 mark]
  • The various types of providers who need to exchange data. [Discussed at the 03:08 mark]
  • Data formats and gaps in the market. [Discussed at the 03:58 mark]
  • Uses for data in ACOs. [Discussed at the 5:39 mark]
  • Problems with current Medicare funding and solutions through ACOs. [Discussed at the 7:50 mark]

You can view the entire conversation in the following video:

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Five tough lessons I had to learn about health care

Realistic conclusions and opportunities in health care.

Despite the disappointments I've undergone in learning about health care, I expect the system to change for the better. Those who want a better system need to look at the areas where change is most likely to make a difference.

Comments: 14

Report from Massachusetts Health IT forum

About clinical effectiveness research, EHRs, and just working
together.

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