Northwell Health has tapped Health Catalyst to provide the backbone for its data and analytics capabilities, including COVID-19 solutions.
The New York City-based health system is entering into a long-term strategic partnership with the the data and analytics company, Northwell Health announced Wednesday.
Health Catalyst will provide solutions to allow for increased cloud-based reliance on data and analytics. The technology partnership will accelerate greater efficiency in data mapping and data storage with the electronic medical record (EMR) and provides an enterprise solution for measurable clinical, financial and operational improvements, the company said.
Financial terms of the partnership were not disclosed.
“Health Catalyst’s augmented intelligence (AI) and data science experience and expertise, along with our shared cultural attributes and mission alignment, will allow us to use data-informed decision making to achieve our shared commitment of transforming healthcare for the communities we serve," said Michael Dowling, president and CEO of Northwell Health in a statement.
Northwell Health is New York State’s largest health care provider and private employer, with 23 hospitals, nearly 800 outpatient facilities and more than 18,500 affiliated physicians.
This partnership will be built using Health Catalyst’s DOS technology, a data-first analytics and application platform, to capture and map raw data into meaningful, actionable insights.
Northwell Health will also immediately have access to Health Catalyst’s growing suite of COVID-19 solutions, including a registry, staff and patient tracker and capacity planning tool.
This week, Health Catalyst also announced the acquisition of Vitalware, a provider of revenue workflow optimization and analytics SaaS technology solutions to healthcare organizations.
The deal, expected to close later this year, is for an aggregate purchase price of about $120 million, with an earnout of an additional $30 million, according to a filing with the Secuirities and Exchange Commission. Health Catalyst plans to fund the transaction using a mix of stock and cash.
"Vitalware provides us with another analytics application, offering us a strategic anchor technology in the revenue space, expanding our CFO value proposition," Health Catalyst CEO Dan Burton said during the company's second-quarter earnings call this week.
This follows the company's acquisition of Healthfinch for $40 million in cash and shares in July.
The Healthfinch acquisition will allow Health Catalyst’s customers to enhance clinical workflows in electronic health record systems, Health Catalyst said.
Second-quarter financial results
Many health systems are beginning to shift their focus from COVID-19 response to broader clinical, financial and operational improvement work, Burton said during the earnings call.
"Since the onset of COVID-19, our customers' overall usage of our data platform has never been higher. Of particular note are foundational analytics applications which are crucial components of our COVID-19 technology response, have seen a significant increase in usage, averaging a roughly 30% increase since the onset of the pandemic," Burton said.
Usage of the company's COVID-19-specific products has shifted from COVID-19 preparedness to financial recovery and planning analytics in areas such as elective procedures, ambulatory care and revenue cycle, he said.
"We cannot think of any events in recent history that has galvanized the awareness and importance of data and analytics more than COVID-19," he said, noting that it will serve as a "meaningful tailwind" in the industry's adoption of data and analytics.
There is the potential for meaningful government investment in healthcare data and analytics infrastructure modernization over time, according to Burton.
Health Catalyst's revenue grew 18% in the second quarter of 2020 to reach $43 million, but the company reported a quarterly loss of $27 million.
A year ago, the Salt Lake City-based company reported revenue of $37 million and a net loss of $11 million.
On a per-share basis, Health Catalyst said it had a loss of 71 cents in the second quarter of 2020. Losses, adjusted for one-time gains and costs, were 15 cents per share.
The results surpassed Wall Street expectations, according to MarketBeat. The average consensus estimate from analysts was for a loss of 39 cents per share.
The data and analytics company's revenue also beat Street forecasts. The consensus estimate was revenue of $42 million in the quarter.
The company's adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) in the first quarter was a loss of $4.2 million, which shows an improvement from a loss of $5.7 million for the same period in the prior year, said Chief Financial Officer Patrick Nelli during the earnings call.
Burton said the company experiernced a purchasing pause starting in late the first quarter during the start of the COVID-19 pandemic.
Health Catalyst's first half 2020 number of net new DOS subscription customer additions was meaningfully lower than originally anticipated entering the year.
The company anticipates strong bookings conversion in the second half of 2020 similar to last year's levels while also acknowledging that the COVID-19 pandemic creates unpredictability in the market.