(Updated to reflect comments from Health Catalyst CEO Dan Burton)
Do you know a doctor whose office looks like a throwback to some long-gone era, with file folders everywhere, and a computer that's from the 90's? I know one. And, I'm sure some of you do. Imagine having to access records and handling the data there. This kind of office, and in fact, many updated facilities have a long way to go when it comes to bringing their data warehouses to today's standards.
It's no wonder therefore, that there's still demand for electronic health records companies that can modernize the data held at our hospitals and health organizations.
Health Catalyst, which creates software for hospitals manage their processes, is expected to announce Tuesday morning that it's raised a $33 million Series B round of funding, led by Norwest Venture Partners and with participation from Sequoia Capital, which led its Series B funding.
The five-year-old Salt Lake City-based Health Catalyst, which was formerly known as Healthcare Quality Catalyst, currently works with 81 hospitals, including Stanford Hospital & Clinics, as well as health organizations, such as Allina Health, Indiana University Health, and MutliCare Health System.
A lot of money is being spent in healthcare with around $750 billion annually estimated to be wasted on, among other things, unnecessary procedures, said Dan Burton, CEO of Health Catalyst, and the company's initial angel investor. The only way to improve quality and reduce costs is through "the use of data," said Burton.
Health Catalyst's software platform can help hospitals better administer procedures. In one example, the health care providers assumed they were administering x-rays to asthma patients with certain conditions about 10% of the time. When the data was uploaded to Health Catalyst, they were able to determine that the x-rays were actually administered 65% of the time. With this knowledge, the providers were able to dramatically reduce their costs and improve the quality of care.
Burton said that the company's goal is to save hospitals $5 to $10 in inefficiences for every $1 they spend on Health Catalyst's software.