Robots, AI, and cognitive analysis: How technology is disrupting hospitals around the globe
Health Care Current | October 10, 2017
This weekly series explores breaking news and developments in the US health care industry, examines key issues facing life sciences and health care companies and provides updates and insights on policy, regulatory, and legislative changes.
Robots, AI, and cognitive analysis: How technology is disrupting hospitals around the globe
By Terri Cooper, Global Health Care Sector Leader, Deloitte Touche Tohmatsu Limited and Stephanie Allen, Global Public Health Care Leader and Australian Health Leader, Deloitte Australia
When we look back at hospitals 20, or even 10 years from now, we might wonder how we accomplished so much without robots, artificial intelligence (AI), avatars, or cognitive analysis. We will likely marvel at how hospital clinicians were able to make complex decisions about our care while also completing an unending list of administrative tasks. We might ask, how did our bodies heal in those drab patient rooms, under bright and buzzing incandescent lights, surrounded by machines and intercoms that beeped, bonged, and blared around the clock?
Whether in an industrialized or developing country, and regardless of the health care system’s structure, hospital leaders, their employees, and their patients struggle with many of the same issues. Cost containment might be at the top of the list among hospitals globally. In the US, for example, health care makes up about 18 percent of the gross domestic product (GDP).1 Although government-run health care systems in Australia, Canada, and the United Kingdom spend far less – about 10 percent of GDP – health care won’t be affordable if costs continue to rise along the same trajectory. Many emerging cognitive technologies promise to bend this cost curve and transform the journey of care significantly.
A lack of connectivity is another issue commonly shared by public and private health care systems worldwide. While the use of electronic health records (EHRs) in the US has grown since the enactment of the Affordable Care Act (ACA), a lack of integration can make it difficult for hospitals and other providers to easily share patient information, such as test results and diagnoses. While Australia, Canada, and the UK are considered to have more integrated health care systems by some, they haven’t yet implemented universal EHRs, and their hospitals continue to rely on the transmission of paper based-records where electronic records don't exist.
Requiring patients to repeat tests and complete identical paperwork not only can create a negative hospital experience for them, it often piles unnecessary work onto nurses, clinicians, and other hospital employees. But we can be optimistic that such scenarios can be reduced or even eliminated as hospitals take advantage of emerging technologies and seek new and better ways to engage with consumers. In a new report, the Deloitte Center for Health Solutions explores the digital hospital of the future.
A growing number of inpatient health care services are already being pushed to the home or to outpatient ambulatory facilities, which helps reduce patient volume. But patients with complex conditions or advanced illnesses will likely continue to need acute inpatient services.
Technology and AI will help enhance decision making
Clinical workforce shortages are a significant issue among hospitals in the US and across Europe. Nurses and other clinicians tend to spend too much time completing administrative tasks and chasing down test results. Nurses devote as much as a quarter of their time on non-patient care.2 We know that when people are overloaded, mistakes can happen.
Cognitive technologies have the potential to not only relieve some of the administrative burden, but also to support and augment the clinical workforce. Some hospitals are already using robots to transport linens, meals, specimens, and to collect diagnostic results – tasks typically performed by clinical staff. Case in point: The South Glasgow University Hospital in Scotland has 26 robots that move medical equipment, linens, food, and waste. These robots have their own underground tunnel (through which they transport supplies) and a dedicated elevator.
In the US, drug dispensary automation has helped improve patient safety by eliminating some decision making, but it isn’t used as much in other parts of the world.3 Hospitals in some countries still keep medications in drawers, which can lead to mis-doses or overdoses because fluids and injectable drugs tend to look similar.
While robotic process automation (RPA) is offloading some duties from the shoulders of caregivers, combining it with AI can take this a giant step further by helping doctors and nurses make appropriate care decisions much more quickly. Let’s use cancer as an example. There are numerous types of cancer, endless variables, and a wide range of treatment options. An oncologist often has to rely on personal experience, the experience of colleagues, and maybe the hospital’s database when deciding the best course of treatment. This can be a time-consuming process…and time is everything for a cancer patient. AI can sift through mountains of data, including studies related to a patient’s tumor, and offer the oncologist well-researched treatment options. Automating this process can give the doctor and patient more time to discuss the diagnosis (based on AI research and the doctor’s own experience) and treatment plan.
Expect a patient-friendly atmosphere and more cognitive workers
Physically, hospitals of the future will likely look different than they do today. They will likely include attractive visitor lounges, dayrooms, and views of natural or green surroundings, such as healing gardens that help reduce patient anxiety and expedite healing. Adjustable ambient lighting will likely be designed to improve the patient experience, particularly in terms of both mood and the experience of pain. These facilities may also be quieter to reduce stress and to help ensure patients get needed rest. Noiseless alarms on medical devices, soundscapes, noiseless paging, and health acoustic engineering will help minimize ambient noise levels.
Patient rooms may look different, too. The walls might be prepopulated with pictures of the patient’s family members, or photos from a recent trip. Along with such “picture walls,” a patient could create a customized music playlist, make video calls with friends and family, or access the Internet. The bathrooms could have integrated sensors to monitor any unusual activities, such as falls, which would trigger a call for immediate help.
The hospital workforce of the future will likely also be different, and could include the following:
- Cognitive workers: Some hospitals have started to supplement their back-office staff with “cognitive workers” that can complete routine tasks. These virtual employees are easy to train and can regularly be updated with new skills by outside vendors. Moreover, cognitive workers don’t take vacations, don’t have emotions, and don’t get distracted. Human workers of the future will likely need different skills and will take on roles that do not yet exist. The hospital workforce of the future could be made up of augmented teams of humans and cognitive workers.
- Avatar counselors: In Australia, avatars are being used in some hospitals to provide health counseling to patients. One virtual caregiver was used in a closed trial of diabetes management. Avatars also can help patients deal with depression and anxiety issues. These cognitive counselors can understand natural language patterns, including sarcasm, and can interpret facial expressions, such as sadness, agitation, and even dishonesty. Clinical trials indicate these avatars provide a consistent and quality interaction, and deliver better diagnosis and outcomes, particularly in relation to mental health and sexual health counseling where the threat of human judgment can sometimes be impeded by the full disclosure needed.
- Discharge planning robots: Practitioners from the health care and social services industry groups from several Deloitte member firms are building an RPA and AI discharge planning “bot” that initiates and coordinates concurrent activities including the discharge summary, prescriptions, transportation, referrals to home support services, and the scheduling of follow-up visits for specialists or occupational therapy. Existing discharge management can be susceptible to problems. An incomplete process, for example, could extend a patient’s length of stay by one or two days.
- Health care companions: Pillo, an AI health care companion that can assist patients in the home, uses the latest in voice and facial recognition technologies to hear, see, and understand natural language. This enables it to adapt the functionalities to serve consumer-specific needs. It can answer health and wellness questions, connect directly with health care professionals, and securely manage vitamins and medication – storing, dispensing, and even ordering refills when people need them.
Rapidly-evolving technologies and growing consumerism, along with demographic and economic changes, are already having a dramatic impact on hospitals. Several megatrends could have significant implications on how hospitals of the future are staffed, sized, and designed. Around the world, hospital executives will likely want the vision for their hospitals to address these megatrends and plan for investments in people, processes, and premises. Ten or 20 years from now, we will likely wonder how we ever got along without cognitive analysis, AI, and other emerging technologies.
PS, If you are heading to the Financial Times Digital Health Summit USA this week, be sure to check Deloitte on the Investment Panel: Tapping new opportunities panel and the Digital health dialogue: Collaborative innovation and successful routes to market panel. Visit our D.com landing page for more details – hope to see you at our panels!
1 CMS Fact Sheet, June 14, 2017. https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/nhe-fact-sheet.html
In the news
CMS delays star ratings update, reconsiders methodology
The US Centers for Medicare and Medicaid Services (CMS) will delay updating its hospital quality star ratings for the second time this year as it continues to reevaluate its rating methodology. CMS usually updates its hospital star ratings biannually.
The ratings system has received criticism from the American Hospital Association (AHA). For instance, the AHA says that the current system is not fair to teaching hospitals and hospitals that serve higher numbers of poor patients. CMS has invited input from the public on this issue over the last several months. The agency has not said when it will release the new hospital star ratings or methodology yet.
Related: Earlier this year, the Deloitte Center for Health Solutions released a report that analyzes CMS’s hospital star rating system. We found that hospitals can achieve a five-star rating in multiple ways, though five-star hospitals typically score well in heavily-weighted categories, which include mortality, patient experience, safety, and readmission. However, hospitals with smaller caseloads may not have data for certain individual measures, driving the disparate ratings. Additionally, many 5-star hospitals report fewer measures than 1-star hospitals, even when we controlled for hospital characteristics, which could be a consideration for CMS as it looks to help lower-performing hospitals and considers revisions to the Star Ratings Program's risk adjustment methodology.
Senate and House committees advance CHIP funding
The Senate Finance Committee and the House Energy and Commerce Committee approved bills last week to fund the Children’s Health Insurance Program (CHIP) through fiscal year 2022.
CHIP provides health insurance to roughly 9 million children nationwide, as well as pregnant women in some states. CHIP’s federal funding expired on September 30, and while nearly all states have some rollover funds, most will run out in a matter of months (see the October 3, 2017 Health Care Current).
In the Senate, all Committee members voted in favor of the bill except Pat Toomey (R-Penn.), who expressed concerns over funding, saying that 42 percent of money mandated by CHIP legislation since 2009 has been spent on unrelated programs. Although Toomey and several other senators brought up potential amendments, Committee members agreed not to officially propose their amendments in an effort to move the CHIP bill forward.
The House Energy and Commerce Committee approved a bill to extend CHIP funding for five years by a vote of 28-23 along party lines. The Committee also approved the Community Health and Medical Professionals Improve Our Nation (CHAMPION) Act, which extends funding for community health centers and related programs. The Committee considered other bills on telemedicine for stroke care, access to diabetes supplies, and continuing the Independence at Home Demonstration project, which provides primary care to Medicare beneficiaries in their homes. The Committee passed all nine bills that it considered. It was scheduled to hear a bipartisan bill that would repeal the Independent Payment Advisory Board (IPAB), but the Committee did not review it during the markup.
The CHIP bill also includes $1 billion in Medicaid funding for hurricane relief in Puerto Rico. The Committee approved disaster relief funding for the US Virgin Islands separately. This was a point of contention during the markup, with some Committee members asking how the government would also pay for the CHIP extension.
Both CHIP funding bills now head to the floor of their respective chambers for a vote. The Senate bill does not contain any policies that would cut spending to offset the cost of extending CHIP. The House bill would pay for the reauthorization by taking funding from Medicare and an ACA program. Democrats voted against the bill because they disagreed with the policies offered to offset spending for CHIP. Senate Republicans and Democrats are working on funding sources for their CHIP bill. They hope to reach an agreement prior to the vote in the chamber.
Tax reform proposal would impact life sciences and health care sectors
The administration released a nine-page framework to update and simplify the US tax code on September 27. Under the proposal, put forward by House and Senate leaders, the chairmen of the Senate Finance and the House Ways and Means committees, Treasury Secretary Steven Mnuchin, and National Economic Council Director Gary Cohn, the corporate tax rate would be reduced from 35 to 20 percent and many special tax deductions would be eliminated, though the research credit would be retained. Additionally, the proposal would tax earnings accumulated offshore. These earnings are taxed at a relatively low rate currently, but in the future, US companies could bring back cash from their foreign subsidiaries tax-free. The proposal recommends allowing businesses to expense capital equipment purchases for the next five years.
If enacted as proposed, life sciences and health care companies could see lower effective tax rates for onshore business activity as well as lower US tax on foreign operations.
MedPAC debates future of the Merit-based Incentive Payment System
The Medicare Payment Advisory Commission (MedPAC) discussed possible alternatives to the Merit-based Incentive Payment System (MIPS) – one of two Medicare payment tracks for physicians and other clinicians under the Medicare Access and CHIP Reauthorization Act of 2015 – as part of a public meeting last week. The Commission considered a draft recommendation to repeal MIPS and replace it with an alternative policy. MedPAC recommendations are not automatically adopted by Congress.
Under MIPS, clinicians receive a payment adjustment based on performance data they submit to CMS. MIPS payment adjustments are set to begin in 2019 based on 2017 performance data. While well-intentioned, MIPS has a number of challenges, according to MedPAC staff. Specifically, they said:
- The program gives clinicians a great deal of flexibility, but it is quite complex as a result, and
- MIPS cannot be relied upon to provide a valid assessment of whether clinicians have provided quality care because the measures used in MIPS have not been associated with improved care, and the scores themselves are unreliable. (Physicians can choose their own measures, and the program is mathematically structured in a way that maximizes scores.)
CMS estimated the reporting burden in 2017 to be more than $1 billion, though more physicians will likely receive exemptions from MIPS than participate in it.
The staff presented a proposed replacement policy, which would repeal MIPS and establish a new voluntary value program. Under the proposal:
- All clinicians would have a set percentage of their fee schedule payments withheld
- CMS would evaluate physicians as part of a larger group based on the quality of clinical services the group as a whole provides, their patients’ experiences, and the value of their services overall
- CMS would award the same payments to all physicians in a given group
Commissioners were in near-consensus that MIPS should be repealed and that the replacement system should hold physicians accountable for the care they provide using population-based metrics. However, some commissioners raised issues with the proposed policy. For instance, evaluating physicians in groups might not be fair to those who work in rural areas or with high-risk patients.
The commission discussed a few alternative ideas, but will continue to discuss this issue and develop a more definitive recommendation for Congress at their December meeting.
Medicare Advantage premiums to decrease by 6 percent in 2018
The CMS says the average Medicare Advantage (MA) premium will drop to $30 per month in 2018 – a $1.91 decrease from 2017. CMS also estimates 20.4 million people will be enrolled in MA plans next year, a 9 percent increase from 2017 and an all-time high.
Ninety-nine percent of Medicare beneficiaries have access to at least one MA plan, and over 85 percent can choose from more than 10. Further, the number of MA plans is increasing – more than 400 additional options will be available next year.
Access to Medicare Part D plans, which cover prescription drugs, is also strong. 100 percent of Medicare beneficiaries have at least one Part D plan option available. The cost of Part D plans is projected to drop from an average of $34.70 in 2017 to $33.50 in 2018.
The enrollment period for all Medicare plans begins October 15.
Court declines to block Maryland law on drug prices
A Maryland federal district court declined a request from the Association for Accessible Medicines (AAM), a generic drug industry group, to block a new Maryland law that targets large price increases for drugs. However, the judge let part of the lawsuit go forward: the claim that the law’s language is too vague.
The Maryland law limits drug price increases and prohibits so-called price gouging for generic and off-patent drugs. The Maryland Medical Assistance Program must notify the Maryland Attorney General and the drug manufacturer when a drug’s price increases above a certain level. Under the law, the Maryland Attorney General could require manufacturers to roll back prices, and fine them $10,000 for each instance of price gouging (see the May 9, 2017 Health Care Current).
The AAM argues that law’s language is too vague, and plans to appeal.
FDA is working with HHS to support Puerto Rico’s drug manufacturing
The US Food and Drug Administration (FDA) is working with the Department of Health and Human Services (HHS), the Department of Homeland Security, and local agencies to assist Puerto Rico in the wake of Hurricane Maria. Specifically, the FDA is trying to prevent drug shortages. The agency has identified more than 20 firms that possess medically important products, and it is working to prevent disruptions in access to more than 40 high-priority drugs, including cancer treatments and immunosuppressants. The agency is coordinating efforts to transport certain critical drugs off of the island.
FDA employees will soon deploy to Puerto Rico as part of the US Public Health Service.
Massachusetts applies to waive Medicaid drug formulary requirements
Massachusetts has applied to waive the federal requirement that state Medicaid programs cover all prescription drug treatments for their beneficiaries. Specifically, the state wants permission to create a closed formulary to generate leverage with drug companies, and only cover certain drugs when they can negotiate favorable terms. The state expects this will limit prescription drug spending in its Medicaid program.
In the waiver amendment application, the state also seeks to move able-bodied adults with incomes above 100 percent of the federal poverty level (FPL) out of its Medicaid program, MassHealth, and into the state’s public insurance exchange. Medicaid funds would be used to subsidize premiums for exchange plans. Massachusetts expanded its Medicaid program to include individuals up to 138 percent of the FPL, as called for by the ACA. This change would revert back to the original Massachusetts Health Reform (known as RomneyCare), which has similar provisions before the state moved to align to the ACA. Medicaid spending now accounts for 40 percent of the state's budget, and it is seeking ways to limit its growth. CMS is seeking comments on Massachusetts' request through October 20. Similar requests were denied under the Obama administration. It is unclear when the new administration will issue a final decision.
GAO says fraud prevention programs save money
The Government Accountability Office (GAO) found that CMS’s fraud prevention programs contributed to at least $20.4 million being saved in fiscal year 2016 by catching incorrect claims before they were paid. Investigations initiated or supported by CMS’s internal analytics system, the Fraud Prevention Service (FPS), led to corrective actions and generated savings, according to the report. FPS also saved $178.8 million by identifying overpayments after the fact, according to the report. The agency also worked with the Healthcare Fraud Prevention Partnership (HFPP), a public-private organization that it helped establish in 2012 to address health care fraud.
The GAO noted that FPS allows contractors to identify potentially fraudulent activity more quickly. HFPP studies helped contractors find individuals that might be engaging in fraud, as well as potential vulnerabilities in the program.
For this study, the GAO interviewed Medicare Administrative Contractors and CMS officials, and reviewed claims data and HFPP documents.
(Source: Government Accountability Office, “Report to Congressional requesters: Medicare: CMS fraud prevention system uses claims analysis to address fraud,” August 2017.)
Hospitals striving to be hubs of innovation
Hospitals and health systems face increasing headwinds as they look to move forward in an uncertain environment. Findings from Deloitte’s recent hospital CEO survey show that many CEOs are ready to tackle challenges facing the health care system with an urgency that has grown since our 2015 survey. As discussed in this week’s My Take, Robots, AI, and cognitive analysis: How technology is disrupting hospitals around the globe, many stakeholders expect the hospital of the future to look very different than today’s hospitals, thanks to emerging technology and consumer demand.
One way hospitals are addressing the shifting landscape is through hospital innovation centers. The aim of many of these centers is to develop and test novel ways of delivering care. Some are funded by foundations and grants, while others operate as departments or divisions within their health care system. A snapshot of these innovation hubs around the country highlights a few recent examples:
- At Nationwide Children’s Hospital in Columbus, Ohio, the Center for Innovation in Pediatric Practice works with hospital clinicians from various specialties, as well as community organizations and agencies including Medicaid and HHS. It also participates in multisite collaboratives. To date, major efforts have included developing pediatric accountable care organizations, and pioneering the use of wireless tablets to screen children in the waiting rooms of doctors’ offices. The hospital provides smartphones to families and children to track medication adherence.
- Johns Hopkins Sibley Innovation Hub, located in Washington DC’s Sibley Memorial Hospital, serves as a launching point for projects including the development of new cord wraps for IV poles, and kits for breast cancer patients that help them manage this condition. Other projects include integrating a bedside technology that helps respond to patients; a Tranquility Room to provide a quiet space for staff; and About Me Boards, in every patient room to share nonmedical info about each patient.
- Opening just over a week ago, the University of Miami’s School of Nursing and Health Studies’ Simulation Hospital aims to replicate a hospital as well as a fully functioning health care system. The facility is among the largest simulation hospitals of its kind in the world. Just weeks after Hurricane Irma descended on the area – leaving a wake of damage, injuries, and even death – the Simulation Hospital offered an environment to practice and prepare for just such a disaster. Among the many benefits the hospital will offer is a venue for community partners, corporate partners, and different university departments to convene and develop rapid and effective responses to emerging infectious diseases, natural disasters, and terrorism. The Simulation Hospital will serve as a hub for students, health care professionals, first responders, and corporate partners to design, test, and master skills and technologies to transform health care education, research, and practice.
As the cost of care continues to rise, many hospitals are looking for long-term solutions to minimize inpatient services. Deloitte’s new research on the global hospital of the future demonstrates how technology and health care delivery will merge to influence the future of hospital design and the patient experience across the globe. Through a crowdsourcing exercise of experts from across the globe, Deloitte developed five use cases for the digital hospital of the future in the following categories:
- Redefined care delivery
Emerging features including centralized digital centers to enable decision making (think: air traffic control for hospitals), continuous clinical monitoring, targeted treatments (such as 3D printing for surgeries), and the use of smaller, portable devices will help characterize acute-care hospitals.
- Digital patient experience
Digital and artificial intelligence (AI) technologies can help enable on-demand interaction and seamless processes to improve patient experience.
- Enhanced talent development
Robotic process automation (RPA) and AI can allow caregivers to spend more time providing care and less time documenting it.
- Operational efficiencies through technology
Digital supply chains, automation, robotics, and next-generation interoperability can drive operations management and back-office efficiencies.
- Healing and well-being designs
The well-being of patients and staff members – with an emphasis on the importance of environment and experience in healing – will likely be important in future hospital designs.
Many of these use-case concepts are already in play. Technology will likely underlie most aspects of future hospital care. But for hospital executives charting their organization’s innovation strategy, care delivery – especially for complex patients and procedures – may still require hands-on human expertise.