October 2017, IDC #US43066117

IDC MarketScape

IDC MarketScape: U.S. Healthcare Clinical and Financial Analytic Consulting Services 2017 Vendor Assessment

Sven Lohse

IDC MARKETSCAPE FIGURE

FIGURE 1

IDC MarketScape U.S. Healthcare Clinical and Financial Analytic Consulting

Services Vendor Assessment

Source: IDC, 2017

Please see the Appendix for detailed methodology, market definition, and scoring criteria.

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IDC OPINION

This study evaluates the healthcare IT consulting and systems integration (consulting) services used

by healthcare organizations to improve their clinical and financial analytic (CFA) capabilities.

Consulting specialists offer healthcare payers and providers many offerings that help clients plan,

build, and manage CFA systems and services in both fee for service (FFS) and value-based care

(VBC) healthcare delivery models. This research investigates the CFA consulting services available in

both FFS and VBC contexts, with a particular focus on the growing VBC marketplace. This study

presents the analysis of IDC Health Insights' evaluation of these consulting offerings using a concise

graphic and brief profiles of seven vendors of consulting services.

Value-Based Care

This study evaluates the capabilities that IT service firms bring to healthcare payers and providers as

they transform the ways in which they analyze and act upon clinical and financial data in both fee for

service and value-based care delivery contexts. The phrase "value-based care" sums up the theory

and practice that is transforming the historically prevalent permutations of FFS business and care

models.

Transaction-oriented FFS compensates healthcare providers for performing discrete services for sick

or injured patients with discrete payments. Across the healthcare industry, many healthcare

organizations continue to operate FFS business and care models successfully. In these contexts, CFA

capabilities increasingly enhance operational efficiency and productivity, thus making related

consulting services increasingly relevant and important.

A VBC model compensates healthcare providers for maintaining or improving the overall health and

well-being of selected populations of consumers and patients and thus outlines not only a

reimbursement schema but also a care delivery schema. IDC Health Insights estimates that VBC

reimbursement currently represents about 10–20% of hospital and physician payments. The goal of

U.S. federal Centers for Medicare and Medicaid Services (CMS) is to tie 30% of all Medicare provider

payments to value through alternative payment models by the end of 2016 and to tie 50% by the end

of 2018. Measurement and reporting requirements that underpin VBC healthcare delivery make CFA

almost essential and therefore make the services of related consulting services more relevant and

important.

Healthcare providers and payers are experiencing numerous challenges implementing and operating

CFA systems in both FFS and VBC contexts. Requirements include new operational processes, new

organizational and employee skills, and new IT systems. There is high demand for sophisticated

information technology (IT) systems and skills that knit together all the organizational stakeholders and

systems. These sophisticated IT systems require the services of expert consultants, systems

integrators, business process outsourcers (BPO), and IT outsourcers (ITO). The IT services

companies evaluated in this study compete to serve healthcare payers and providers (some of which

are integrated as per Kaiser Permanente) that serve healthcare consumers and patients under VBC

models.

Market Assessment

Revenue Growth

Overall revenue growth in the healthcare consulting space has been slowing in 2017 over 2016. This

isn't an industry segment in crisis, but some of the consulting firms working here are under pressure. In

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perhaps the most obvious case, The Advisory Board Company reported in January 2017 that it was

laying off 220 people because of a difficult healthcare industry sales environment in the second half of

2016. Media reports in early July 2017 indicated that Advisory Board was in talks to sell its healthcare

business. In late August, it was announced that Advisory Board would definitely split its healthcare

from its education industry business and sell both to different buyers. UnitedHealth Group (parent of

UnitedHealthcare and Optum) will buy Advisory Board. Based on IDC Health Insights' estimate that a

majority of Advisory Board's total revenue is based on healthcare clients, we believe that Advisory

Board's healthcare business is being sold for a fire sale price.

In the years leading up to 2016, Advisory Board had grown strongly, largely on the basis of its forward-

looking healthcare consulting capabilities, many of which helped healthcare organizations embrace

and implement value based care and its associated analytic foundations. The fact that Advisory Board

has encountered difficulties sufficient to compel the company to sell its healthcare operations at what

appears to be a discount represents to IDC Health Insights strong evidence that revenue growth in this

market segment has slowed significantly in the last 12 months, pressuring vendors of consulting

services related to value-based care and clinical and financial analytics — and likely both.

Offerings Are Works in Progress

In parallel with payers and providers struggling to implement VBC models, many consulting firms in

this space are still developing their offerings and refining their market positioning. IDC surmises that

some firms declined to contribute to IDC Health Insights about this market segment for this reason,

even though it is very likely that they command considerable relevant client experience and

technological know-how. IBM, for example, brings a broad array of services and software assets to this

marketplace, particularly in light of recent acquisitions (especially that of Truven Health Analytics)

under the banner of Watson Health, but IBM declined to contribute. Perhaps Optum declined to

contribute to this research for the same reason. Optum has positioned considerable assets and

resources squarely in this competitive space; Optum will soon complete the acquisition of Advisory

Board.

Waiting for the Chaos to End

One executive asked, "When will the chaos [in VBC] end?" IDC believes there is no consensus about

how and when future prospects for the VBC consulting market segment growth will brighten but that

value-based care (and its requirements for investment in CFA software and services) will prove

durable. This study advances the thesis that in five years when vertically integrated payer/provider

groups in each of the large regional markets begin to look and act like Kaiser Permanente (which we

believe is the model for VBC as structured by the U.S. federal government), the unintended monopoly

character of those entities will eventually drive up prices for healthcare. Faced once again with

frustratingly high costs for healthcare, the industry may be forced to confront another chaotic period as

the federal government decides whether to adopt a single payer system or whether to encourage a

federally led round of decentralization, disaggregation, and innovation. In the current period of

uncertain environment, services vendors in this market segment are advised by IDC Health Insights to

invest in what they can control: client relationships, VBC, and CFA services expertise. Buyers of these

services are also advised to invest carefully in order to realize tangible benefits within realistic time

frames.

Winning Vendors

The most successful offerings and vendors will be those that effectively market the deepest vertical

expertise, CFA technology capabilities, and an appetite for sharing risk with clients based on

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performance and outcomes. Service line breadth also helps the vendor to endure in a client enterprise

and mature its partnership with that client. Further:

Vertical expertise: Deep sector expertise lends a services firm efficiency in its operations and credibility with clients. Expertise in CFA gives services firms the capacity to execute well and

profitably. Within this context, it is important for BPO service vendors to build competencies and offerings for the segment of the market that shows the greatest potential for strategic expansion: VBC. This market hosts numerous niche vendors of services across the expansive

range of the continuum of care (primary care to inpatient, outpatient, and home-based care) and the variety of payment and reimbursement methods and regulation (commercial and public). In just the revenue cycle management field alone, there exist in the U.S. market at

least 100 significant vendors of software and/or services.

An appetite for shared risk: Under VBC, it is necessary for payers and providers to align

incentives and share risk. The same principles are increasingly being applied to service providers that work with clients to stand up and run VBC models. Demand for risk-sharing contracts between cash-strapped healthcare organizations and their IT service providers is

growing, and some service providers show greater aptitude and appetite for work in this context than others. Firms such as Accenture and Deloitte demonstrate a strong appetite for sharing risk and have created and managed contracts according to these terms and conditions

worth billions of dollars. However, vertical and technology capabilities and commitment to

partnership with clients are still more important than this appetite for shared risk.

CFA technology expertise: Important solutions areas in which vendors must demonstrate CFA expertise include electronic health records (EHRs such as Epic, Cerner, and eClinicalWorks in both inpatient and outpatient contexts), health information exchange (HIE) technology, data

analytics, quality and financial metric reporting, and the consumer- or patient-facing systems (also called customer relationships management [CRM]) that contribute to care management. Other important areas of technology expertise include social media and mobile

communications, cloud-based IT infrastructure and data management, and connected health, which is the technology for care delivery across geographies and stakeholder groups. Relevant technology services include systems integration, application development and

management, data management and analysis.

Service line breadth: The breadth of work that a services firm cultivates across a client's

enterprise helps the relationship between a vendor and a client endure and mature. This type of flexibility is demonstrated, for example, when a services firm uses its consulting capabilities to gain the strategic high ground over rivals during its clients' expansionary periods and then

uses entrenched outsourcing contracts to ride out periods during which demand for external services is suppressed. Such breadth helps the vendor attain the status of a general contractor, whereby it assists its client in managing other services vendors and contracts.

Furthermore, a services vendor that offers high-quality strategic advice helps the vendor attain trusted advisor to senior client management and entrée to the most important business and

contract opportunities.

IDC MARKETSCAPE VENDOR INCLUSION CRITERIA

IDC Health Insights frequently has unique visibility into vendor selection processes within the

healthcare payer industry through clients and other contacts in the industry. A comprehensive list of

vendors that do business in the commercial and government business intelligence marketplaces would

include dozens of entities, but this study has focused only on what is believed to be the largest and

most noteworthy. The vendors considered for inclusion in this study of CFA services were judged by

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IDC Health Insights to be especially notable in terms of total services revenue (combined consulting

and outsourcing) and/or deemed sufficiently differentiated and innovative to merit in-depth evaluation

and comparison.

The inclusion criteria were applied to the CFA services providers in terms of both their current

capabilities and their strategies. Research and due diligence were conducted to narrow an initial list of

vendors down to only those that IDC viewed as highly differentiated contenders for future deals within

the healthcare payer CFA services market. We evaluated the overall market drivers and the key

differentiators among salient offerings that current buyers of these services have reported to us. This

study included structured interviews with approximately 20 experienced buyers of payer CFA services,

in addition to other complementary interviews of various industry experts.

This IDC MarketScape evaluates seven vendors. The combined revenue of these vendors accounts

for a very significant portion of payer CFA consulting spending and represents a varied sample of the

CFA consulting services offerings on offer to health plans. Brief portraits of each of the seven vendors

that appear in this IDC MarketScape are presented in the Vendor Summary Profiles section.

ADVICE FOR TECHNOLOGY BUYERS

Key findings about the best practices that health plans employ when hiring and managing CFA

consulting services vendors are presented in this section. It condenses findings from interviews with

approximately 20 payer and provider organizations that have bought consulting and, also, potentially

outsourcing services from one or more of the vendors featured in this IDC MarketScape. Key lessons

learned include:

Correctly assess the healthcare organization's strategic goals and current IT assets.

Clarify the strengths and weaknesses of the consulting firm during the selection process.

Prepare to invest in the external service providers that are hired.

Look for high-quality account management and commitment from senior consulting and/or

outsourcing team leaders.

Balance the roles and responsibilities of full-time employees (FTEs) with those of external

resources to minimize risk, maximize economic returns, and retain control.

Maintain the quality of resources within external vendor teams for the duration of a contract or

vendor-client relationship.

Establish appropriate baseline key performance indicators (KPIs) at the beginning of a

consulting relationship and then monitor and reward performance appropriately.

Where appropriate, intelligently and fairly share risk with service partners based on a spirit of partnership with a view to improving the maturity of the partnership over time. Note that trust in

vendor capabilities and commitment is more important than contracts that align incentives.

When integrating the skills, processes, and IT systems of vendors and healthcare

organizations, consider transfer of knowledge and working habits at the level of individual

people.

For more details on several of these best practices, see IDC PeerScape: Practices for Purchasing Healthcare Clinical and Financial Analytics Consulting and BPO Services in the United States (IDC

#US40515316, September 2017).

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VENDOR SUMMARY PROFILES

This section briefly explains IDC's key observations resulting in a vendor's position in the IDC

MarketScape. While every vendor is evaluated against each of the criteria outlined in the Appendix,

the description here provides a summary of each vendor's strengths and challenges.

Accenture

Accenture is positioned in the Major Players category in this IDC MarketScape.

Accenture was founded in 1989, although it was an offshoot of Andersen Consulting, which was itself

an offshoot of the far older but now extinguished accounting giant Arthur Andersen. The Accenture

healthcare IT consulting/SI practice was therefore officially founded in 1989, but in practical terms, its

culture and institutional knowledge is many decades older. Accenture has offices in over 200 cities in

55 countries and serves clients in over 120 countries worldwide. The firm employs over 411,000

people globally. During the fiscal year ending August 31, 2016, Accenture's net revenue rose by 10.5%

in local currencies and 6% in U.S. dollars from the prior year to $32.9 billion.

Accenture's Health and Public Service operating group contains two industry groups: Health and

Public Service. This operating group's net revenue represents 18% of Accenture's FY16 net revenue.

The operating group experienced growth of 10% over the prior year. The health industry group works

with providers, government health departments, policy-making authorities/regulators, managed care

organizations, insurers, and others. In fiscal 2016, these clients generated approximately 39% of the

Health and Public Service operating group's net revenue.

Consulting offerings are grouped under the following headings: Health Administration Services,

Clinical Services, and Health Management Services. The Public Service segment of this industry

group, which contributed the remaining 61% of the Health and Public Service operating group's FY16

net revenue, is not covered in this study. Accenture consulting offers payers and providers strategic

and IT capabilities related to all service lines and functional areas.

Historically, Accenture has focused on serving healthcare payer and provider organizations with more

than $2 billion in annual revenue, but the firm makes strategic efforts to work with smaller

organizations that it believes will have an exceptionally significant impact on the healthcare

ecosystem. Such organizations include accountable care organizations (ACOs) and patient-centered

medical homes (PCMHs) that are particularly innovative or relevant to larger communities or

organizations.

Strengths

Accenture's healthcare technology consulting and analytics practices are broad, deep, and well

entrenched in the U.S. healthcare ecosystem. The scale of its experience gives Accenture advantages

when competing with other IT services firms to solve business problems related to analytics,

particularly as they relate to value-based care. Impressively for such a large practice, Accenture goes

to market flexibly in key areas.

First, Accenture demonstrates a special appetite for accepting and sharing risk with clients. Accenture

promotes the use of outcomes- or performance-based contract terms and includes such terms in

almost all healthcare contracts. This is important because it indicates that Accenture's healthcare

practice possesses an especially robust capacity and commitment to align incentives with clients and

build durable client relationships. This capacity to share risk is especially relevant to clients working in

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the domain of value-based care, founded as it is on alignment of incentives between payers and

providers.

Second, Accenture demonstrates an exceptional capacity to quickly identify and integrate specialized

areas of expertise or IP as they become relevant to its client-facing offerings. While the company is

agnostic with respect to the technologies it works with on behalf of clients, Accenture's foundational

expertise rests on a broad base of strategic technology relationships (care management and CRM,

EHR, interoperability, and automation). From these foundations, Accenture moves aggressively to

augment capabilities as needed. Much of this growth is organic, but through M&A Accenture has

acquired eight companies that are relevant to its healthcare analytics practice since 2013.

Challenges

The scale of Accenture's position in healthcare IT and in the CFA services market segment makes the

firm sensitive to macroeconomic trends and national political events. Accenture's healthcare consulting

practice has likely been broadly impacted by the political turmoil and economic confusion that followed

the victory of Donald Trump in the U.S. presidential election and the subsequent debates that swirled

around the future of the Accountable Care Act. Downward pressure on rates and the frequency of new

starts to consulting engagements from healthcare clients are likely to have impacted projects

associated with clinical and financial analytic consulting offerings, especially as these innovative

projects are sensitive to pressure on the discretionary budgets of healthcare organizations. IDC Health

Insights believes that Accenture has likely been recalibrating its healthcare consulting practice's

approach to the CFA market segment in 2017, and in the short term, Accenture may be hesitant in

making investments in its offerings in this market segment.

Consider Accenture When

Consider Accenture when seeking a long-term partner that can serve as a general contractor or central

manager of other IT services vendors within the enterprise. Accenture offers the full spectrum of IT

service lines, and it manages its relationships with clients as well as it manages relationships within its

constellation of industry partners and coworkers. Accenture is therefore well suited to helping clients in

supervising or managing other IT services vendors. This capability is supported by Accenture's

preference to include risk-based terms in its contracts and to manage the company's work in alignment

with other stakeholders according to well-defined financial and performance-based metrics.

Advisory Board

Advisory Board is positioned in the Contenders category in this IDC MarketScape.

The Advisory Board Company was founded in 1979 as a research company and began to focus on

healthcare in 1986. In that year, the company launched its Health Care Advisory Board. By 1997, the

company had focused strongly on healthcare and spun off other related business as an independent

company (Corporate Executive Board). At this time, Advisory Board counted 1,500 healthcare

organizations as clients. Also in 1997, according to its website, Advisory Board launched H*Works, a

consulting business offering best practices implementation support, which was the start of its

consulting and management services. The Advisory Board currently employs approximately 3,500

professionals and serves 5,700 healthcare organizations and educational institutions. It describes itself

as a "best practices firm that uses a combination of research, technology, and consulting to improve

the performance" of its clients. IDC Health Insights estimates that 80% of revenue is generated by

healthcare clients through subscriptions, software sales, data services, and consulting. Advisory Board

now counts 10 locations in the United States, 1 in the United Kingdom, and 1 in India.

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During the calendar year 2016, Advisory Board grew revenue 5%, but in early 2017, the firm

announced it would refocus its healthcare strategy and restructure. It announced it would lay off 220

employees (5.7% of its workforce) due to poor sales results in the last half of 2016. Pointing to

especially poor financial results following Donald Trump's election and to consequent uncertainty in

the healthcare industry, Advisory Board said it would focus more closely in the future on offerings

linked to margin improvement and cost reduction for what is primarily a hospital-based clientele. The

company grouped its offerings as follows: health system growth, care variation reduction, and revenue

cycle management. These strategic priorities notably do not include an explicit focus on new business

models or analytics. This news about strategic reprioritization and restructuring was overshadowed in

August 2017. At this time, it was announced that Advisory Board's healthcare business would be

acquired by Optum for approximately $1.3 billion, with the deal to close in late 2017 or early 2018. The

sale of Advisory Board indicates that the early 2017 announcements about strategic refocusing and

restructuring only hinted at systemic problems within the business that shareholders and management

must have believed insoluble.

Strengths

Historically, the company's expertise in value-based care and analytics was very strong and helped

drive growth of Advisory Board's healthcare practice following the passage of the Affordable Care Act

in 2010. The company's mix of software products plus subscription and consulting services

distinguished Advisory Board from competitors that relied much more heavily on software or pure

consulting services. Advisory Board's reliance on a mix of revenue streams sold at accessible price

points also helped democratize the expertise of the Advisory Board, gaining the firm access to many

different types of healthcare institutions. Claiming 5,700 customers, of which perhaps 80% could be

considered healthcare institutions, Advisory Board was collecting revenue from a large percentage of

the estimated 5,000 hospitals in the United States, and its publications and services touched a large

percentage of mid- to high-level clinicians and executives in the U.S. healthcare delivery industry. The

Advisory Board's brand and expertise are well known and respected, especially on topics related to

business model innovation, clinical reorganization, and the uses of analytics in VBC.

Challenges

By late 2016, the management and stockholders of Advisory Board may have become aware that it

had saturated its market and that it was ill equipped to compete in a stagnating sector. Even before the

shock and industry confusion that followed the Trump election, Advisory Board's overall revenue

growth had plateaued. In 2015 and 2016 growth came only incrementally, compared with the leaps of

prior years. In public, the stumble in the final months of 2016 prompted a strategic reorientation, while

in private, the company must have launched a serious search for a potential buyer. IDC Health Insights

believes there may have been three factors driving the sale of the company: saturation of the

healthcare market, the offering structure, and the business model.

The number of clients counted by Advisory Board implies that the company had sold subscriptions,

consulting services, and/or software products to a large proportion of U.S. healthcare providers. This

implies that the market had been well penetrated and that cross-selling existing customers was the

only viable route to healthy growth in the healthcare market. The company appeared to have stumbled

in 2015 and 2016 in its cross-selling efforts.

Until early 2017, Advisory Board's subscription and services business had been aligned with the

restructuring of U.S. care delivery, but this offering structure was likely undermined by the surprise

election of president Trump. Following the Trump election, Advisory Company's management likely

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believed that the Accountable Care Act and VBC would be seriously undermined. IDC Health Insights

believes that the healthcare industry has indeed lost confidence in investment in new business models

and has refocused on cost containment. Thus Advisory Board's offerings related to innovation and new

business models turned from a strength to a weakness very quickly.

Furthermore, Advisory Board's business appears to lack deep roots at client enterprises. Competitive

consulting firms and software firms have succeeded in developing durable relationships, which

continue to yield growth despite current market uncertainty, but Advisory Board has not demonstrated

a hold on nondiscretionary client budgets. Advisory Board's management and stockholders likely

recognized this weakness prior to the market downturn and lost no time in taking action to sell the

company in early 2017.

Consider Advisory Board When

Consider Advisory Board when tactical questions relating to business, technology, and clinical

decisions intersect. Advisory Board offers answers and solutions to clinicians and hospital

administrators in easily digested fashion on narrow topics at speed. Under the current overhang of the

firm's acquisition by Optum, however, clients are likely best served when turning to Advisory Board

regarding tactical concerns within a near-term time frame.

Deloitte

Deloitte is positioned in the Leaders category in this IDC MarketScape.

Deloitte is a professional services organization with over 264,000 practitioners in over 150 countries.

The original firm was founded in 1845, and since then, the firm has evolved through numerous

corporate changes, including numerous acquisitions and mergers. Deloitte's global headquarters is in

New York City, New York. During the fiscal year ending May 31, 2017, total firm revenue grew 7% in

local currency over the prior year.

Worldwide, consulting revenue grew 10% over the prior year. Head count in Deloitte's consulting

practice grew 13% worldwide. Deloitte's consulting capabilities include human capital, strategy and

operations, and technology. Deloitte's life science and healthcare practice serves all client segments,

including government sector clients. The company's healthcare IT consulting/SI practice has served

clients since the mid-1960s.

Deloitte has demonstrated special commitment to the VBC market segment. When Deloitte launched

ConvergeHEALTH in early 2014, it united a broad set of relevant capabilities under a single banner. At

that time, the company announced a $150 million to $200 million investment in its healthcare business,

staffed initially by approximately 300 people. The company sought to help clients align incentives

among healthcare stakeholders, with particular attention being given to revenue cycle management

and population health management. The ConvergeHEALTH initiative was supported by Deloitte's

analytics expertise and technology products and by industry partnerships such as Intermountain

Healthcare.

Strengths

With the launch of ConvergeHEALTH, Deloitte invested early and with scale to become a preferred

consulting partner to the front-runners in the U.S. healthcare industry's shift to value-based care.

Deloitte built this initiative around a company it had acquired in 2012, Recombinant Data, uniting

Recombinant Data's analytics capabilities with Deloitte's own deep expertise in healthcare technology

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and consulting. The initiative was rounded out by partnerships, initially with Intermountain Healthcare.

Intermountain contributed that organization's considerable data, clinical expertise, and reputation as a

pathfinder in VBC. Market uptake for Deloitte's services in this space may have failed to live up to

Deloitte's ambitious initial goals, but ConvergeHEALTH has nonetheless created a lasting foundation

for Deloitte's assertive positioning as a leading consultant in the VBC and the clinical and financial

analytics sectors.

Challenges

Deloitte's emphasis on ConvergeHEALTH as a brand and marketing initiative has diminished in the last year, perhaps affected by market confusion that has followed the surprise election of president Trump and the cloud of insecurity that has subsequently hung over the Accountable Care Act and VBC. Deloitte may currently be revising its strategic vision around the ultimate goals for Deloitte's role in the implementation of VBC and the speed with which it should expect adoption of related consulting services.

In the meantime, enterprise clients may observe that Deloitte is still integrating its impressive breadth of capabilities in this emerging market space. Just as enterprises struggle to overcome organizational silos, Deloitte may be experiencing parallel challenges within its consulting capabilities and even more broadly within its Tax, Risk and Financial Advisory services. This same challenge is reflected in the overarching healthcare industry need to align incentives among diverse stakeholders.

A factor in the challenge that Deloitte faces in the integration of its services to healthcare organizations may be Deloitte's widespread use of risk-based contracts with clients. Deloitte is adept at working with clients using performance-based or outcomes-based contract terms; such terms are a common fixture in its relationships with healthcare clients. However, the diversity of contracts that Deloitte may hold within a single enterprise client may complicate the coordination of individual engagements and relationships within that single enterprise client. Work that serves a new business model or technology capability for a hospital, for example, might need to be proactively tied back to other Deloitte engagements related to the hospital system's enterprise finance function, especially when those different engagements operate under different incentives and client leaders.

Consider Deloitte When

Consider Deloitte when a combination of the deepest and broadest consulting VBC care capabilities

under outcomes-based contract terms is preferred. Note also that clients seeking deep technology

capabilities in addition to generalist consulting capabilities will find them with Deloitte. However,

Deloitte offers only limited opportunities to continue client relationships based on outsourcing

contracts.

KPMG

KPMG is positioned in the Leaders category in this IDC MarketScape.

KPMG (KPMG International Cooperative) was formed in 1987 with the merger of Peat Marwick

International and Klynveld Main Goerdeler. One of KPMG's progenitor firms was founded in 1870, and

the company's healthcare IT practice has served healthcare clients for decades. KPMG is an

international professional services organization, with over 189,000 practitioners in over 150 countries.

KPMG's advisory capabilities grew 11.5% in FY16 and include management consulting, risk

consulting, and transactions and restructuring. In the fiscal year ending September 30, 2016, total firm

revenue grew approximately 6% and the advisory practice revenue grew 6% over the prior year. The

firm's international headquarters is located in Amstelveen, the Netherlands.

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In the United States, KPMG's Healthcare and Life Sciences practice employs more than 25,000

people. Of these, more than 3,800 are U.S. partners and healthcare professionals. KPMG's U.S.

Healthcare and Life Sciences practice works with healthcare providers, payers, government, and life

science companies. Service offerings feature value-based care. They include value-based growth

strategies; improved performance through advanced analytics; diligence, inversions, separations, and

integrations; adapting to the consumerism of healthcare; complying with evolving regulations;

optimizing EHR systems; harnessing disruptive technologies; optimizing global business services; and

transitioning from volume to value.

Over at least the past five years, KPMG has invested heavily in its healthcare practice, which has

yielded growth at a faster rate than almost all of its other industry vertical practices. KPMG has also

invested heavily in its technology expertise. Across the continuum of healthcare workflows, KPMG

leverages rapidly evolving technology capabilities in enterprise intelligence, technology enablement,

digital health, staff and physician engagement, and physical assets. In the past several years, KPMG's

ambitious investment has filled in and integrated a broad set of healthcare capabilities related to

clinical and financial analytics.

Strengths

In recent years, KPMG's clients have noted a steady improvement in the breadth and depth of its

healthcare capabilities. Investments in analytic technology and data sets have proven relevant and

built effectively on the firm's historic strengths in finance, tax, and compliance. Perhaps more

importantly, clients that have worked with KPMG for more than 5 or 10 years note that the firm has

simultaneously improved the skills of its engagement personnel and the internal communication and

collaboration that enable the firm to bring its skills to bear on client challenges. "As the market grows

toward population health and total cost of care," said one client," KPMG teams are getting the

expertise that they need." KPMG clients testify to distinctive expertise in analytics in both provider

administration and clinical operations. As one executive leader with decades of experience in hospital

revenue cycle management at a nationally known provider organization noted, "I don't educate them.

They educate me."

Augmented by the 2011 acquisition of advisory firm EquaTerra, KPMG has marked out distinctive and

defensible healthcare expertise in advising clients on contracts. This strength overlays its healthcare

offerings at the intersection of legal and financial fields. KPMG has long held a specialized position in

accounting and tax services. Added to this, KPMG's rapidly evolving strengths in specialized

healthcare clinical and IT fields create a highly defensible position that can be used as a platform to

create additional opportunities to expand its position in the healthcare market. First, KPMG's strength

in healthcare contracting puts it in a position to advise clients on critical growth initiatives as the

industry slowly adopts and adapts to value-based care. This gives KPMG entrée to cross-selling

opportunities within existing clients. Second, KPMG's interactions on behalf of clients with other

stakeholders as they change their relationships in the healthcare ecosystem introduce KPMG to new

potential clients in a context that showcases their breadth and depth of capabilities. Thus KPMG can

leverage its strength in healthcare contract consulting to build relatively rapidly on its long-standing

relationships in the healthcare industry with chief financial officers that have evolved from KPMG's

accounting and tax capabilities. In particular, it gives KPMG opportunities to grow capabilities related

to clinical and financial analytics associated with VBC, opportunities that KPMG has already invested

heavily to exploit.

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Challenges

KPMG's healthcare practice is evolving quickly, and growing pains have surfaced as it has expanded.The area of primary concern is account management, especially for the largest enterprise clients. Growth in capabilities for serving clients around questions of contract and billing activities has lagged behind growth in client engagement capabilities. However, these deficiencies in account management capabilities appear to be counterbalanced to a degree by the ready access that KPMG leaders offer to clients and by the flexibility with which KPMG works with clients.

Market perceptions of KPMG's consulting capabilities in the healthcare provider sector, particularlyrelated to the firm's clinical expertise, lag behind KPMG's current capabilities. For decades, the firm has demonstrated deep wells of expertise in tax, finance, and compliance as they relate to healthcare, and those are the fields in which perceptions of the firm's capabilities are still most commonlyassociated. It will take time to grow KPMG's market presence on those foundations beyond the CFO's office into the leadership offices of clinical, operational, and IT functions of provider organizations.

Consider KPMG When

Consider KPMG when engaged in contract negotiations for provider finance, administrative, and/or IT functions. KPMG leverages expertise in healthcare contract negotiations in addition to its expanding breadth of expertise working with stakeholders from across the healthcare ecosystem. KPMG'sexpertise in healthcare is well supported by technology, tax, financial risk, and legal expertise from KPMG's broader suite of capabilities.

Navigant

Navigant is positioned in the Major Players category in this IDC MarketScape.

Navigant acquired its name in 1999. Prior to that, the publicly traded company was named the Metzler Group. It began its existence with a focus on the energy industry and grew through acquisition of other consulting companies to include additional industry and horizontal specializations. Since 1999 Navigant has continued to acquire other consulting companies and teams and has focused strongly on the healthcare industry, showing growth of 13% over the prior year. The company employs approximately 5,800 people and is headquartered in Chicago, Illinois.

The company operates in four units: healthcare, energy, financial services advisory and compliance,

and disputes, forensics, and legal technology. The healthcare segment provides consulting services

and business process management services. Clients of this segment include healthcare providers,

payers, and life sciences companies. The annual report explains that "we help clients respond to

market legislative changes such as the shift to an outcomes and value-based reimbursements model,

ongoing industry consolidation and reorganization, Medicaid expansion, and the implementation of a

new electronic health records system." The healthcare unit reported 23% growth during 2016, over half

of which Navigant reported was organic, "driven by strong demand for large strategy-led

transformation projects and revenue cycle consulting engagements."

Broadly, Navigant aims to help clients achieve operational excellence. It does so through three major

groups of offerings: build, manage, and protect. The suite of "build" offerings includes strategy

consulting, operations consulting, and transaction advisory. The suite of "manage" offerings include

compliance business process outsourcing, mass tort claims, and revenue cycle. The suite of "protect"

offerings include disputes, economics, forensics, investigations, legal technology, risk and compliance,

and cybersecurity. Navigant also works closely with partners. One is Leidos, well known as a

government-focused IT systems integration and cyber security specialist.

©2017 IDC #US43066117 13

Strengths

Clients are impressed by the depth of Navigant's capabilities in its areas of focus, by the wealth of knowledge wielded in the ranks of Navigant's high-level and mid-level management, and especially, by Navigant's commitment to client relationships. One client reference characterized his relationship with Navigant as "a true partnership," in which he relied on Navigant's expertise in the area covered by the contract exclusively. He and his organization had committed to a partnership with Navigant in broad areas of IT and managed services and did not regret the decision to exclude other vendors from those areas of activity. He said he and his counterparts at Navigant communicated with a very high degree of candor and frequency. Navigant continually exceeded expectations, he said, moving with rapidity year after year to overperform on the terms of their mutual contract and its flat fee rate structure.

Challenges

Navigant's healthcare practice's prime challenges are based on its growth and diversification. In 2016,the practice grew by 23%, driven in part by inorganic acquisition and diversification away from its roots as a pure-play consultancy. In approximately five years, Navigant has grown its healthcare business in business process outsourcing from a financial footnote into a significant portion of its healthcare business. Through this period, the healthcare practice leadership has rightly focused on maintaining the company's sense of mission and its focus on client relationships. Absent a fixation on its mission and on customer satisfaction, the culture of a growing and diversifying organization can become diluted, internally competitive, disjointed, and dysfunctional. Based on Navigant's capacity to demonstrate the special partnership illustrated by the client reference previously, it appears that Navigant can continue to show its customers the benefits of working with a smaller practice, even as it adopts more service lines and competes with much larger and more diversified firms.

Consider Navigant When

Consider Navigant when commitment to partnership is the primary criterion of satisfaction. Navigant combines depth of sector expertise with the capacity to partner with clients closely. The firm offers broad and deep capabilities within revenue cycle management (both on a consulting and on anoutsourcing basis), in which the company has made five acquisitions since 2005. But in other consulting and outsourcing fields relevant to clinical and financial analytics, we estimate that Navigant's resources number only a fraction of those employed by larger competitors. Within Navigant's appetite and capabilities, clients report a high degree of satisfaction.

NTT DATA

NTT DATA is positioned in the Major Players category in this IDC MarketScape.

NTT DATA's healthcare IT services capabilities were largely acquired from Dell in 2016. Dell's

powerful services business crossed many industries and included a very large healthcare consulting

and outsourcing practice. These were themselves largely acquired from Perot Systems in 2009. Perot

Systems was sold to Dell in 2009 for $3.9 billion. During the period in 2016 in which Dell acquired IT

storage business EMC, Dell sold its former Perot Systems business to NTT DATA for $3.1 billion. The

sales price indicates that Dell took a loss on this IT services business, but while IDC Health Insights

believes that some vertical business units in the former Perot Systems portfolio shrank, we believe the

healthcare vertical services business prospered and grew considerably from 2009 to 2016.

NTT DATA is a Japanese IT company based in Tokyo, Japan. NTT DATA has been known as a strong

horizontal technology vendor in areas such as supply chain management (SAP) and finance (Oracle).

NTT DATA is itself a subsidiary of Nippon Telegraph and Telephone (NTT), also based in Tokyo,

Japan. The portfolio of healthcare IT services that NTT DATA acquired from Dell overlaps the service

©2017 IDC #US43066117 14

lines previously found at NTT DATA. From a vertical industry point of view, however, the acquisition

from Dell offers NTT DATA much greater industry depth, particularly in healthcare. NTT DATA's

Healthcare and Life Sciences organization works with payers, providers, and life science companies

globally.

NTT DATA's IT services are structured around customers in the traditional healthcare segments in

consulting and systems integration, business process outsourcing, application management

outsourcing, and IT infrastructure services. NTT DATA has synthesized its offerings in these traditional

categories into a population health management offering that resonates with the market shift in the

United States toward value-based care.

Strengths

NTT DATA's healthcare industry experience ranks with industry leaders in breadth, service lines, and technology experience. This breadth of expertise creates opportunities for NTT DATA to work closely with clients on projects related to clinical and financial analytics, population health, and other forward-looking initiatives associated with VBC in a technologically agnostic role. The breadth of NTT DATA's practice also lends the company opportunities to create durable relationships within each client account, a strength complemented by the practice's reputation for being highly responsive. This breadth of expertise also positions NTT DATA well to compete among other services vendors for a general contractor role at the side of a hospital (or hospital system) CIO that seeks to rationalize the number and scope of its external IT services vendors. NTT DATA's strengths resonate particularly well among midtier hospital systems.

NTT DATA's continuing investment in IT interoperability and open source software complements the company's aspirations to play the role of the agnostic systems integrator in the CFA sector. For over a decade NTT DATA (especially in its prior Dell Services and Perot Systems incarnations) has invested considerable resources in standing up and supporting health information exchanges. And while the economic benefits of HIEs (and their sponsoring organizations) have been elusive, NTT DATA's expertise in this sphere has solidified the company's relationships with hospital systems, has created a base knowledge of the technology required for successful VBC delivery, and positions the firm as an alternative to other software vendors built on "walled garden" models. Recent events should give NTT DATA added incentive to continue to invest in interoperability and open source software skills, such as the 2015 decision by the Department of Defense to eschew the award of a massive contract to Epic Systems.

Challenges

The primary challenge for NTT DATA is to build depth across its broad range of offerings. NTT DATA

teams and personnel are reputed to be highly responsive and eager to satisfy contract relationships

and build client relationships, but clients are advised to manage NTT DATA resources closely in order

to achieve the best results. The healthcare practice's breadth creates durable client relationships and

opportunities to work with clients on forward-looking initiatives and in integrative data analytics

projects. But as one client has noted in this research effort, NTT DATA experts from different parts of

its healthcare and technology practices don't always speak with one voice. The same commentator

noted that while some NTT DATA resources are excellent, others lack healthcare industry and/or

technology expertise appropriate for their roles, especially in clinical and financial analytics. As NTT

DATA builds its bench strength in healthcare IT skills, particularly in analytics, and demonstrates

greater internal cohesion, it will be in a position to capitalize on its breadth of offerings.

©2017 IDC #US43066117 15

Consider NTT DATA When

Consider NTT DATA when breadth of expertise across market segments, service lines, and

technologies is vital to systems integration or outsourcing support for a healthcare analytics initiative.

NTT DATA's solid understanding of healthcare IT interoperability and open source software supports

the company's capabilities to play an agnostic, general contractor role within a complex provider

delivery system environment, particularly in projects related to analytics, but NTT DATA's lack of

bench strength in some fields requires client organizations to work closely with NTT DATA teams to

ensure success.

PwC

PwC is positioned in the Leaders category in this IDC MarketScape.

PwC is a global network of member firms, with over 223,000 employees and offices in 157 countries.

The firm was formed by the merger of Coopers & Lybrand and Price Waterhouse in 1998 and

rebranded itself PwC in 2010. One of its progenitor firms (Price Waterhouse) was established in 1849.

PwC's global headquarters is in London, England.

During the fiscal year ending June 30, 2016, PwC's revenue grew 7% over the prior year. The largest

services groupings are audit and assurance, consulting (also called advisory), and tax. Advisory

business revenue grew 8.3% over the prior year. Business in the North America and Caribbean region

grew by 7.5% (of which advisory business composed a large fraction) over the prior year. Business

from the health industries made up 7.7% of the aggregated revenue for FY16.

PwC's consulting offerings include capital projects and infrastructure, customer impact, finance,

forensics, innovation, M&A advisory, operations, people and change, risk management, security,

technology, and global advisory services. The firm trains all client-facing personnel in change

management skills and puts particular emphasis on providing clients with strong project execution

capabilities. PwC's healthcare IT consulting/SI offerings are an integral component of PwC's U.S.

Health Industries Group, which serves payers and providers (including accountable care

organizations), pharmaceutical and life sciences clients, and government clients.

Strengths

Healthcare organizations seeking above all strategic flexibility in this market segment will find PwC's

capabilities tailored for their support. A PwC client can expect access to a broad range of capabilities

(market segment, service line, and technology) and a highly flexible and adaptive approach. Unlike

Deloitte, PwC has consciously eschewed the creation of a formalized and broadly advertised set of

offerings and marketing campaigns associated with VBC and related analytics. Instead, PwC has built

capabilities in a modular way within its existing set of healthcare industry offerings, particularly with

respect to internal software development that supports consulting. PwC borrows a reference from

technology to describe its market positioning as a "platform approach." Noting that healthcare

organizations tend to invest in VBC initiatives and analytics in haphazard ways (adopting, for example,

multiple risk stratification tools without a common technology foundation), PwC positions itself in this

market segment primarily as an adaptive and agnostic bonding agent that can unify a client's existing

assets across multiple dimensions: human, organizational, and technological.

©2017 IDC #US43066117 16

Challenges

PwC risks having its sotto voce "platform" message about VBC and analytics drowned out by

competitors, especially Deloitte. Because PwC lacks a unifying marketing message, high-profile

industry partnerships, and high-level offerings focused on VBC, the firm could appear flat-footed or

uncertain. However, PwC appears to have accepted that risk willingly, preferring to speak judiciously

about a market that is uncertain about fundamental driving factors, such as the future of the Affordable

Care Act and the long-term focus of the Trump administration. While waiting for the market to resolve,

PwC is instead determined to build out its portfolio of modular offering components (frequently

combinations of services and software) and optimize its consulting engagement delivery capabilities.

Look for PwC to leverage technology to improve the impact and operations of its engagement teams.

Expect PwC to try to make its prior investments in analytics capabilities and data repositories pay off at

accelerated rates. Expect PwC's sotto voce sales approach to focus less on macroeconomic and

political considerations and more on the importance of durable consultant-client relationships, cost

containment, profit margins, and strategic adaptability.

Consider PwC When

Consider PwC when only a high-quality Big 4 consulting engagement is needed. In comparison with

peer competitors, PwC's low appetite for taking on long-term contracts outside of the company's

consulting service line expertise lends its practice independence, simplicity, flexibility, and speed.

Clients focused on introducing and managing a team of consultants into their organization may not

want to be burdened by consideration of the impact that such an exercise might exert on a broader

vendor relationship, or by potential complications to the consultants' incentives or deliverables. PwC

offers clients a Big 4 consulting experience without the encumbrance of such considerations.

APPENDIX

Reading an IDC MarketScape Graph

For the purposes of this analysis, IDC divided potential key measures for success into two primary

categories: capabilities and strategies.

Positioning on the y-axis reflects the vendor's current capabilities and menu of services and how well

aligned the vendor is to customer needs. The capabilities category focuses on the capabilities of the

company and product today, here and now. Under this category, IDC analysts will look at how well a

vendor is building/delivering capabilities that enable it to execute its chosen strategy in the market.

Positioning on the x-axis, or strategies axis, indicates how well the vendor's future strategy aligns with

what customers will require in three to five years. The strategies category focuses on high-level

decisions and underlying assumptions about offerings, customer segments, and business and go-to-

market plans for the next three to five years.

The size of the individual vendor markers in the IDC MarketScape represents the market share of each

individual vendor within the specific market segment being assessed.

IDC MarketScape Methodology

IDC MarketScape criteria selection, weightings, and vendor scores represent well-researched IDC judgment about the market and specific vendors. IDC analysts tailor the range of standard

©2017 IDC #US43066117 17

characteristics by which vendors are measured through structured discussions, surveys, and interviews with market leaders, participants, and end users. Market weightings are based on user interviews, buyer surveys, and the input of a review board of IDC experts in each market. IDC analysts base individual vendor scores, and ultimately vendor positions on the IDC MarketScape, on detailed surveys and interviews with the vendors, publicly available information, and end-user experiences in an effort to provide an accurate and consistent assessment of each vendor's characteristics, behavior,and capability.

Market Definition

"Clinical and financial analytic services" definitions are derived from prior IDC reports and taxonomy

documents. Details about these reports are discussed in the sections that follow.

Clinical and Financial Analytics Software

Clinical and financial analytics (CFA) software tools allow healthcare providers to examine clinical and financial data together and to use the resulting insights and conclusions to provide actionable advice for optimizing delivery of care to patients and reimbursement. Inputs can be about highly varied clinical and financial topics from dozens or hundreds of original sources, while output of analysis may be clinical, financial, or a combination of both. The insights and decisions supported by these software tools are particularly important for measuring and managing the performance of the latest generation of healthcare organizations. They attempt to align the incentives of healthcare insurance companies and healthcare providers to provide better quality care more affordably. The terms used to describe this new business model paradigm include value-based care and accountable care. The paradigm has spawned a variety of business models, including Patient-Centered Medical Homes (PCMHs), bundled payments, and the federally recognized model called the Accountable Care Organization (ACO). The value-based care paradigm is foundational to the U.S. federal government's Patient Protection and Affordable Care Act (PPACA) of 2010.

Standalone Solutions

Supporting the value-based care business models are software platforms and standalone solutions

evaluated in a prior IDC MarketScape. These solutions include two major categories. The first is

enterprise data warehouses (EDWs) and big data analytics platforms that enable end users to employ

multiple analytics applications (including tools supplied by the platform vendor). The second is made

up of third-party software vendors and tools and capabilities that help providers to develop homegrown

analytics models running on a platform. Platforms allow healthcare providers to approach analytics in

multiple ways, with agile tools that may include clinical and financial analytics, text and data mining,

population health analytics, cost and cost accounting analytics, performance and quality management

analytics, and dashboards, as well as data exploration tools that can be applied to as-yet-undiscovered

questions. Major standalone software vendors analyzed in the IDC MarketScape include the following:

The Advisory Board: Crimson

Allscripts: EPSi

ArborMetrix

Explorys

Health Catalyst

IBM: Advanced Analytics

McKesson: Performance Analytics

Optum: Optum One

©2017 IDC #US43066117 18

Oracle: Enterprise Health Analytics

Premier

SAP

Verisk

Successful analytics programs will develop and nurture platforms that assemble and manage data,

offer tools to ensure data quality, and offer applications that allow providers to explore and assemble

data on demand into analytics models that meet business needs, whether they are long-established

business needs or spur-of-the-moment questions. Analytics programs often enlist help of external

service vendors.

Relevant Clinical and Financial Analytics Services

Here we evaluate the service offerings of the independent (even objective) vendors that implement

and support standalone clinical and financial analytics platforms and standalone analytic solutions that

are specific to the healthcare industry. In contrast, service offerings by software-focused firms with in-

house CFA solutions are excluded. Software-focused firms such as Epic and Cerner frequently do

consulting and systems integration work to implement the analytics platforms that are available as

embedded technology within their own health information systems (e.g., electronic health records

[EHRs]), but the scale and emphasis of their services arms puts them in a separate competitive

category outside the scope of this study. Only IT services vendors that work with a diverse set of

software vendors are considered in this study. IDC definitions are adopted for this study for the

following services categories: consulting, business process outsourcing, and Technology Outsourcing

are important services categories defined below.

Consulting

The project-oriented services that fall in IDC's Worldwide Services Taxonomy are denoted together in

this study as "consulting." Strategic and operational consulting work outlines business models,

governance structures, delivery models, organizational capabilities, business processes, and

technologies for clients. Such work is often followed by information technology consulting and systems

integration work. Application development work is also considered part of the consulting category.

While contracts for such services may transition from one phase to another with the same IT services

vendors over more than one year, such contracts are generally structured as individual projects with

discrete milestones of less than one year.

Business Process Outsourcing

According to IDC's Worldwide Services Taxonomy, business process outsourcing involves the transfer

of management and execution of one or more complete business activities, business processes, or

entire business functions by a customer to an external (third party) services provider or an outsourcer.

In this IDC MarketScape, the relevant processes are tied to the long-term use of CFA solutions that

support the clinical and financial operations of accountable care organizations. These processes

include data scraping and cleansing, data formatting and analysis, and reporting. BPO resources can

be used to maintain constant and close coordination among stakeholder groups such as payers,

federal and state regulators, primary care and specialist physicians, and patients. BPO resources play

an important role in making analytic insights and decisions actionable. Contracts may cover more than

one year and may be evaluated and extended according to performance metrics.

©2017 IDC #US43066117 19

Technology Outsourcing

The subcategories according to IDC's Worldwide Services Taxonomy include application

management, hosted application management, IT outsourcing, network and endpoint outsourcing

services, and hosting infrastructure services. Note that IT support and training functions are not

included. They transfer responsibility for the ongoing management and execution of an activity, a

process, or a functional area to an external service provider to expand efficiencies and improve

performance. Provision of ongoing CFA management and operations are delivered to the

specifications defined in service-level agreements (SLAs). They may include IT asset management, IT

administration and operations, network management, and related archiving and recovery activities.

Technology outsourcing contracts that support CFA may be structured for several years. Such

outsourcing contracts have been known to cover up to 10 years of service and increasingly include

performance-based metrics.

Strategies and Capabilities Criteria

Tables 1 and 2 provide key capability and strategy measures for the success of U.S. healthcare clinical

and financial analytic consulting services vendors.

©2017 IDC #US43066117 20

TABLE 1

Key Strategy Measures for Success: U.S. Healthcare Clinical and Financial Analytic Consulting Services

Strategies Criteria Definitions Criteria Weights

Customer base Quality and size of targeted market 15.0

Delivery Impact of partnerships (technology, segment, service line) on future

growth; appetite for and capacity to exploit industry partnerships

5.0

Functionality or

offering strategy

Systems integration, analytics, HIE, EHR reporting software; structured

and unstructured data

10.0

Functionality or

offering strategy

Payers (private and public), providers (inpatient, outpatient), and value-

based business models

10.0

Functionality or

offering strategy

Generalist and technology consulting; systems integration; BPO and ITO 5.0

Growth General contractors likely to command higher levels of client trust, more

enduring relationships, and greater profitability and durability

10.0

Growth Hiring and retraining to satisfy resource demands 10.0

Growth Investing in technologies, segments, and project execution capabilities

likely to grow in demand

15.0

Innovation Scale and direction of strategic investment in healthcare industry

expertise

10.0

Pricing strategy Appetite and capacity to share risk 10.0

Total 100.0

Source: IDC, 2017

©2017 IDC #US43066117 21

TABLE 2

Key Capability Measures for Success: U.S. Healthcare Clinical and Financial Analytic Consulting Services

Capabilities Criteria Definitions Criteria Weights

Customer satisfaction Capacity to serve current clients 20.0

Delivery model Responsiveness to individual client needs around contract types, co-

development, project management, and midproject corrections or

changes

5.0

Functionality or

offering

Systems integration, analytics, HIE, EHR, reporting software; structured

and unstructured data

10.0

Functionality or

offering

Payers (private and public), providers (inpatient, outpatient), and value-

based business models

10.0

Functionality or

offering

Generalist and technology consulting; systems integration; BPO and ITO 10.0

Healthcare industry

expertise

Depth and breadth of experience working with various models and types

of organizations (e.g., ACOs, bundled payments)

10.0

Market positioning Effectiveness of current sales and marketing in creating new business

with both existing and new clients

5.0

Partnership Impact of partnerships on current contract execution 5.0

Pricing model Appetite and capacity to share risk 5.0

Range of services Generalist and technology consulting; systems integration; segment

experience; work with different business models

15.0

Total cost to buyer Cost of resources; onshore and offshore mix for both internal and client

software development

5.0

Total 100.0

Source: IDC, 2017

LEARN MORE

Related Research

IDC PeerScape: Practices for Purchasing Healthcare Clinical and Financial Analytics Consulting and BPO Services in the United States (IDC #US40515316, September 2017)

IDC's Worldwide Services Taxonomy, 2017 (IDC #US42356617, March 2017)

©2017 IDC #US43066117 22

IDC MarketScape: U.S. Healthcare Provider Clinical and Financial Analytics Standalone Platform 2015 Vendor Assessment (IDC Health Insights #HI255139, April 2015)

Synopsis

This IDC study describes the offerings that consulting service providers present to the healthcare

organizations that design, build, manage, and operate IT systems that analyze clinical and financial

data and then use this data to provide actionable insight and guidance for optimizing delivery of care

and reimbursement.

"Clinical and financial analytics are critical for the future success of healthcare organizations,

particularly in the context of value-based care models," said Sven Lohse, research manager, IDC

Health Insights. "Consultants and systems integrators offer vital capabilities for the design,

implementation, and management of these analytics. Healthcare organizations should understand and

leverage the capabilities of these service providers, where appropriate, to effectively, efficiently, and

quickly use analytics to gain better integrated and more actionable views of clinical and financial

performance."

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory

services, and events for the information technology, telecommunications and consumer technology

markets. IDC helps IT professionals, business executives, and the investment community make fact-

based decisions on technology purchases and business strategy. More than 1,100 IDC analysts

provide global, regional, and local expertise on technology and industry opportunities and trends in

over 110 countries worldwide. For 50 years, IDC has provided strategic insights to help our clients

achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology

media, research, and events company.

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