The BigUnlock podcast- Episode4

Episode #4: “Blockchain can solve the two big problems for healthcare today” with Lidia Fonseca, Senior Vice President and Chief Information Officer

In this episode, Lidia Fonseca, Senior Vice President and Chief Information Officer, talks to us about how five leading health care organizations – Humana, MultiPlan, Quest Diagnostics, Optum and UnitedHealthcare – have launched a pilot program applying blockchain technology to improve data quality and reduce administrative costs associated with changes to health care provider demographic data. Provider data management is a $2.1 billion problem in healthcare today, and is a critical, complex and difficult issue facing organizations across the health care system.

Welcome to the big unlock where we discuss data analytics and emerging technologies in healthcare here’s some of the most innovative thinkers and health care information technology talk about the digital transformation of healthcare and how they are driving change in their organizations.

Hello everyone, this is Paddy and it’s my great privilege and honor to invite is my guest on today’s podcast Lydia Fonseca, CIO of Quest Diagnostics. Lydia welcome

Hi Paddy nice to be here.

Very good very good, so Lydia for the benefit of our listeners if anyone is not aware of who Quest Diagnostics is do you want to take 30 seconds and share a little bit about the company?

Sure, so Quest Diagnostics right we are the leader in diagnostic information services. We deliver actionable insights to help empower better health to the industry. We’ve been in business for more than 50 years and you know we definitely focus on providing you know not only diagnostic lab services but also you know deliver population health and data-driven solutions that help you know industry participants whether they’re consumers, providers, hospitals and payers to make better decisions about healthcare and you know we are 45,000 employees strong and pretty large footprint in the US. Other parts of the world as well but you know pretty heavily dialed in the US and you know I would say other kind of notable facts about Quest is that we serve 1 in 3 Americans every year. We are connected with more than 650 EHR platforms and we are connected to 50 percent of hospitals and have more than 470,000 providers that you know interact with us in our part of our network. And the last bit of piece that I think is notable is that we do have a big data backbone of more than 40 billion test results one of the largest data sets in healthcare and again we really leverage those data to provide insights into the industry.

Right, right so I know Lydia you have a very unique perspective on this whole industry because on the one hand as the CIO of Quest Diagnostics you are a buyer and a consumer of technology solutions. On the other hand you also wear the hat of someone who leads the new offerings the ones that you talked about data and analytics and so on so do you want to talk a little bit about the two different hats that you wear?

Sure so as you said Paddy right I am I serve as a CIO for Quest and everything that you’re accustomed to associate with the CIO right. Network state operations security sorry data center operations security email right and then I also serve as a CTO for the company and we develop client sites and solutions technologies software as well as all of the analytics capabilities as well which you know enables us to really bring to the market through our Quanum. All our data and technology services are delivered to our Quanum brand. So Quest Quanum is our brand of solutions that we communicate and we extend to the market. So you’re right you know on the one hand I live the life of the CIO and on the other hand we’re also you know product creation in technology innovators as well which is great.

Yeah yeah that must give you a really unique perspective on the market. Now that’s a great segue into this recent announcement around blockchain pilot that Quest is a part of. First of all you know for listeners who may not be really familiar with what blockchain is all about do you wanna kind of provide your definition of what it is and what it can do for healthcare and then we’ll jump into what this new this recent announcement is all about.

Sure so you know when we think about blockchain you know the way I’d like to characterize it is you know blockchain is a distributed database and that’s cooperatively owed and if distributed data database or ledger is used to collect share and exchange information among different participants and I’ll tell you that blockchain is most useful when loosely coupled organizations want to confidently and transparently share information, automate manually, beneficial processes and articles interactions. So when you think about you know the pilot that we’re embarking on with the other companies that we announced you know if you think about provider data which is the first use case that we’re tracking today right each of us individually maintained that provider data in separate and independently managed IT systems and what we’re doing is we’re actually creating a blockchain where we bring these data to a common blockchain instance right this distributed database that I mentioned and then you know we’re all committing to actually updating that information and whenever any of us that participate in the blockchain making you know make a change that change becomes automatically available to the rest of us. The reason why that’s really important is that you can imagine right if each of us are maintaining independent information not only if the information not necessarily complete but there’s a lot of redundancy right and extra cost because each of us are maintaining these databases independently in separate systems. So that’s you know how I like to describe you know that what blockchain is and also what blockchain does.

Right so so I have a two-part question here you know how did you end up picking this use case for blockchain, this provider data management and did you have you know wipe it blockchain to solve this problem could it not have been solved by other technologies?

Sure so you know so to answer your first question right there’s one of the things that attracted us about this use case is that provider data right. It really is a key building block for certain pretty key processes in the industry. So you need provider data to process claims, for payment processing and also right the payers are all required to have up-to-date provider directories. Now that that use case right if you think about this one research and they’ve estimated that the industry spends about 2.1 billion dollars a year across the industry chasing and maintaining provider data and through this project we believe that 75% of that cost could be eliminated by having a single source of truth. So that’s what we’re aiming to do and the reason why blockchain makes sense for this is because the blockchain by definition if a distributed data database right and so imagine that we’re going in that distributed database that single source of truth about provider data and blockchain the way the technology lends itself for those of us that participate right so we’re going to be updating right because we’re having interactions with providers all of us that are part of the Alliance and so we’re going to be providing updates and we’re committing what’s unique about this because I think the technology as blockchain can really enable these distributed database, this ability to update information and then make it available to all the participants. I think what what’s unique about this is that when you think about you know Humana, Optum, MultiPlan, Quest and UnitedHealthcare the five of us what’s unique about this is that we’re willing to cross across company boundaries to actually improve the quality of the data and therefore speed up claims processing and payment processing and you know in that process also reduce the administrative burden in the industry. So we definitely see it as as a great fit for blockchain because of the nature of blockchain to have that distributed you know a database with the other elements of blockchain that enable you to have a single source of truth that’s been available to participants.

Yeah that’s 75 percent you expect this solution could address you know as much as 75% of the 2.1 billion in provider database maintenance costs, did I hear you right on that?

Yeah provider data correct.

Wow so now obviously you know this initial consortium has several big names in the Unitedhealthcare, Optum through Optum and Humana and yourself. Do you see this as a start we see this growing as a consortium, do you see this solution kind of spreading across a broader network. Is that longer-term vision or vision or or is it going to be a you know fairly closed sort of network?

No our aim is to so blockchain right our belief is that the more participants there are the better it is for the industry right because then you can have a more complete data thing. We’re starting you know there’s these five founding member companies and what we are our plan is that to the pilot stage where we’re right now pilot stage. We wanted to keep the participation manageable to get to the pilot. However, you know we are having a lot of conversations because we’ve actually been approached by a number of organizations that want to you know participate in the effort and so our plan is to get through the pilot because we have a number of goals. One we want to leverage right one of the goals that we want to prove that the blockchain technology can be an enabler for this, we believe that they’ll be wanted you know we’re using the pilot to prove that we want to improve the data quality both completeness and accuracy that’s another goal that we have and goal number three is to reduce the administrative burden right we want to see and we want to be able to measure the improvements. So our goal is to get to the pilot and then we’re going to be providing updates from how we’re doing on the pilot, but then our goal is to open it up and have participants from across the industry because we believe that the more participants right the more completely the data fit.

Right right what do you expect to see results from the pilot what’s the time frame for an initial set of proof points if you will?

Our aim is that towards the latter part of the year if when we’re going to be coming back and sharing you know what we’ve learned through the pilot and also what you know next step so expect towards the latter part of the year towards the end of the year.

Right right no I’m certainly going to be looking forward to hearing more about this. So in general kind of taking a step back if you will in general what what do you see as the interest and adoption level for blockchain today in healthcare. You know it’s still very early I guess it’s fair to say that blockchain is still very early in healthcare although in other sectors like banking and finance it seems to be moving ahead a little bit quicker and of course blockchain has been most commonly associated with Bitcoin which is a whole different story you know in itself. What do you see happening in healthcare today what are some of the other use cases that you’re saying or what do you see as the outlook for blockchain?

Sure so you know we you’re right you know in healthcare it is early base for blockchain I think you know if we are expecting and you know hoping that this pilot is going to bring you know some tangible proof points that you know will give the industry more confidence and you know so we definitely want to be able to provide through the pilot a real use case so we’re excited about that. As far as what other opportunities are available for healthcare I think you know other data fits I mean I definitely you know I think the collaboration the ability to improve you know through improving the quality and the you know completeness and accuracy of data, well we’re starting with provider data we you know we certainly envision other use cases in the future one step at a time right we want to first prove this one but we do you know if you stay with the concept of the single source of truth right if you think about health care right and if you spend in (14.44) even healthcare long enough there’s been a couple of common challenges right. One is interoperability and the other one is the completeness or you know the quality of the data right and what we see if blockchain can actually help to address both of those and so this pilot right like I mentioned right you have the five companies you know pretty decent big sized companies in their own right are willing to cross company boundaries to be able to actually you know exchange information and provide you know real-time updates so I think that addressing the opportunity of interoperability which has been a theme for as long as I’ve been in healthcare nothing in healthcare for a while and then the other one is connecting the dots about you know so the quality of data. So I we can see other use cases our view is that let’s prove it out let’s prove the technology let’s show that you know by collaborating and exchanging information and you know we can improve the data quality and therefore speed up transactions, speed up claims processing and then also reduce administrative burden so if you think about it then achieving those three goals all open it up for us to look at other use cases and there are plenty of use cases that we can go after I want to improve you know that we’ve improved provider data.

Yeah yeah and you mentioned frame processing and I know that there’s at least you know at least one solution out there that addresses revenue cycle management as an area of opportunity and you know in the pharma industry they’ve talked about the supply chain processing right the provenance of drugs in the supply chain and using that as a not just a single source of truth but also really attract the provenance of the drugs it and ensure the integrity of the supply chain and so on. So those are some of the use cases that I have come across. I don’t know how far ahead they are but you know yours is the one that seems to have made the biggest impact at least in terms of a handful of major industry players coming together to do something like this. Now I was surprised by wondering which is that in your consortium I didn’t see a health plan, a health system and you know they are they should be right a part of this whole process of ensuring the integrity of provider data. Any reason why there isn’t a provider in the consortium?

I think you know we started with the five of us right and again you know we wanted to keep the group at a manageable level because we wanted to get to the pilot and you know I think you can consider rafts of providers in that sense because we are a provider of you know services into the industry but you know there’s like as you mentioned right there’s three payers and then you have a provider group you can consider Quest, a provider of services and then MultiPlan right which is more of you know they’re more of a providing exchange services and you know some of the kind of revenue and connections right between payers and other providers. Again something that we are certainly open to but we wanted to get going on this. We are very excited about what we can achieve and so but we definitely are you know at some point once we’re a little bit further on you know you can anticipate that you know there will be you know really participants from you know from all over the industry including health systems in provider group.

Right right right now that will be excited now, so this is an exciting start and obviously you know there’s going to be some challenges because you are pioneers right and as pioneers you’re going to have to be the ones to overcome the initial challenges and show the way for the ones you’re going to follow. What do you think the biggest challenges are going to be you know in the first phase of this project?

You know it’s interesting because if you have asked me this question three months ago, you know I find it’s not the technology as much that’s the challenge I think in the blockchain technology as it is today we feel pretty confident you know can enable the certainly the processes that we are going after and I will tell you that like I said what makes this unique is this collaboration, these companies coming together in you know really collaborating and that I could tell you that because we’re working very closely together it is a very collaborative and you know it’s really five companies that are respecting each other’s point of view and perspective and that’s actually been a lot of fun to be part of the alliance and so if you had asked me this three months ago I would have told you probably the biggest challenge would be the collaboration because you have you know five companies that have obviously goals and strategies but I’ll tell you what has been really a pleasant surprise for me in this is how excited everybody is that blockchain it’s really a promising enabler to a couple of challenges that have been challenges for a long time and so there’s an excitement there. I think there’s also a willingness to really like if I go across company boundaries and then we’re also working very closely together and then building on each other’s ideas and then there’s also very much a very strong sense of execution so as an alliance you know we have work streams, the work streams meet pretty regularly we have various project plans and charters and so there’s also an element of execution which you know in a relatively you know kind of short time that we’ve been operating together it’s pretty impressive to me how how much progress we have made and how much commitment there is from all the five companies and so I would say it’s really just you know kind of staying the course and executing against our plans but I don’t see challenges I think the technology is further along and that I think it’ll support our needs I think the collaboration aspect and being able to make progress and you know in collaborating with five you know pretty strong upright companies. I think so I feel like you know I would say for my challenge I’ll tell you probably from a challenge perspective it’s making sure that we keep the industry appraised of our progress because you know balancing the fact that we start with a small group to get the pilot done but knowing that our goal is to actually have as many participants as we can so it’s definitely the challenge is how do we balance working with the smaller you know set of founding members to execute on our pilot but then keeping the industry coming along with us on the journey knowing that we want to stay a little bit small for now because we got to manage and get it done but then you know we want others to participate and we want to create this community right that improves the quality of data and improves the processes and reduces you know the administrative burden which you know and the width of technology which is terrific.

Right now that’s it’s going to be exciting right so it’s not the technology as it is with most large complex initiatives it’s never the technology. The technology is something you can manage and control it’s always the change management and you know all the people management and collaboration that kind of stuff it’s very well said. So that’s fantastic I really look forward to following the progress of this project before we close do you want to share any updates and any of your other collaborations that you’ve got going on the data diagnostics and the other collaboration and anything you want to share with our listeners?

You know I think we continue to drive our goals of you know connecting consumers, providers, payers and its feels right with actionable insights that are based on lab clinical and you know in other health data right so we continue to really innovate on our Quanum portfolio of services you know we definitely are seeing a very positive response from our customers in and that’s nice to see it’s nice to see that our various audiences whether it’s a consumer you know we’re now up to 5.3 million consumers that are interacting with us on MyQuest. Last time I spoke to you it was four million so I mean this was terrific um. You know we have providers are excited about our Quanum for health care providers portals that we’re now you know we’re now converting customers to there’s been a lot of positive feedback there we’ve actually you know brought on some new services, new online services that really provide some digital differentiators for our customers and then on the data front we you know we acquired a company called MedXM which is an extended care services company and it’s great that we’re actually you know that acquisition just happened pretty recently and we’re they’re leveraging now that they’re part of the family they’re leveraging our big data you know insights and platforms and we’re finding a lot of new opportunities to continue to you know grow the business and then enable the you know the industry to make better decisions so all all good you know we’re excited about all these developments when we continue to just innovate on our offerings and bring solutions that you know really empower better health with diagnostic insights out there so.

Yeah yeah I interviewed Dr. Dunleavy from Inovalon in my last podcast and they just did this big acquisition and everything and I know that you have a partnership with them which is on the data diagnostics side of things. So you know you’re obviously very successful and you know the collaboration model is something that seems to work well for you so all the best for this one as well.

Yeah thank you we very much believe that healthcare for team sport and we enjoy it.

Wonderful wonderful once again thanks for taking the time Lidia. It was wonderful talking to you

All right thanks Paddy it was nice talking to you as well.

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About our guest

Lidia Fonseca, Senior Vice President and Chief Information Officer

Lidia Fonseca, Senior Vice President and Chief Information Officer

Lidia Fonseca is Senior Vice President and Chief Information Officer (CIO) for Quest Diagnostics.

Ms. Fonseca leads the enterprise-wide Information Technology (IT) function to support the needs of the business. She also leads our end-to-end enterprise architecture and integrates processes, data and systems across the network thereby enabling future growth and driving operational excellence.

Previously, Ms. Fonseca was the Chief Information Officer at LabCorp and also held a number of senior leadership positions in supply chain and IT at Philips Healthcare.

Ms. Fonseca is a member of the Board of Directors of Tegna, Inc. (NYSE: TGNA). She earned a bachelor’s degree from the University of California, Berkeley, and an MBA and a master’s degree in business informatics from the Rotterdam School of Management, Erasmus Graduate School of Business.

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