A NSW PHN is underwriting the cost of the first year of practice data and intelligence software Cubiko to help them develop financial resilience.
Hunter New England PHN this week announced a deal with practice data intelligence platform Cubiko.
The PHN will underwrite the use of the software for a year with at least half of its local GP practices, with a view to helping those practices become more financially sustainable.
The offer is part of a program that HNEPHN announced in February called the General Practice Sustainability and Viability Initiative (SAVI) which the PHN has characterised as a transformational program to “stabilis[e] the general practice sector across the HNECC PHN region”.
More specific practice aims of the program described by the PHN include:
- Maximisation of practice revenue;
- Assistance in pro-active business planning;
- Risk identification and mitigation; and
- Support in taking next steps on any plans.
A spokesperson for the PHN said that it already had 220 practices enrolled in the program, which represents nearly a half of all the practices in the PHN’s catchment.
The PHN is offering the program for free but has put a value on the program for a participating practice at between $5000 and $10,000.
Although the details of the Cubiko deal aren’t entirely clear, it is understood the PHN has acquired a certain number of paid licenses for SAVI and will be providing any practice that wants to take up the deal under their SAVI program with a full license to the paid version of the software.
This means that anyone within a participating practice will be able to use the software.
The cost saving for a practice that opts to participate can be quite a lot, given that for a three-person license on Best Practice or Medical Director, the cost of Cubiko is $1785 per annum.
A Cubiko license is based on the same number of licenses a practice uses for its patient management system. If you have 10 doctors working at practice (tenants, employees or otherwise) then a Cubiko license would be about $3225, which is a great saving for a practice, especially if they’ve been unsure about the return they are going to get for using the software so have been reluctant to try it.
Back-of-envelope calculations might lead you to some sort of estimation of the size of the HNE PHN contract:
- 220 practices at an average of five doctors per practice;
- 1100 licenses at approximately $323per license (10 licenses at $3225)
- which is about $330,000 almost certainly not going to be what HNE PHN paid for the deal;
- Likely only a proportion of the 220 will take the deal up, so if we say 30-40% don’t take the deal and apply a big discount for the PHN taking so many licenses in one go, you might get to an estimate of between $100,000 and $200,000.
The deal looks like a win-win for all the parties involved.
GP practices they get Cubiko for free for a year to learn and see if it can really help them.
HNEPHN gets a very discounted price on a neat piece of software to help their constituent GP practices which will likely provide much of the value of their SAVI initiative.
Cubiko gets an initially good contract sum from a PHN, a portion of which will likely convert to long-term direct customers after one year.
Cubiko is excited by the deal for obvious reasons. If it works, then there is likely potential for other PHNs to adopt a similar program for their GPs using the same protocols that HNE has used, and in that there might be significantly expanded potential for the group to build out a lot more footprint in GP practices across the country.
Taking on multiple licenses of software on behalf of their local GP practices has been common for PHNs in the past. In particular, most PHNs have covered the cost of data extraction software and analysis software on behalf of their local GPs so practices can see extra data for both PIP payments and for other analysis of their clinical patterns.
While the data extractors are focusing on clinical analytics, Cubiko is much more focused on practice financial analytics.
One way of looking at the deal is that HNEPHN is reselling Cubiko through their GP practice relationships.
Not everyone is happy, of course.
Vocal local GP HNE practice owner and digital health innovator Dr Max Mollenkopf posted on LinkedIn about the announcement this week pointing out that you can only get the deal from HNEPHN if you’re using Best Practice or Medical Director, and by restricting the offer in this manner the PHN was helping to stifle important innovation in sector.
Dr Mollenkopf uses cloud-based patient management system MediRecords in an innovative configuration which allows his small practice to operate more intimately with both his doctors and patients via virtual care and AI offerings.
But being a fully cloud-architected PMS, Cubiko doesn’t integrate with MediRecords, the group having focused its efforts on the PMS systems with the most market share.
Best Practice and Medical Director have about 90% of the GP market at this point in time. Both are server-bound applications which are expensive to integrate with and maintain an integration but having 90% share of GPs makes it worth the effort for Cubiko.
Integrating with smaller PMS vendors, innovative or not, is not always economic for Cubiko, so new or smaller vendors often get locked out of functionality that is offered by third-party integrations because they have to fund the integration.
“The repetitive use of software providers that are only integrated with BP and MD reinforces the PMS duopoly and continues to exclude innovation in the Australian market,” Dr Mollenkopf said on his post.
“If government funding bodies won’t force change then we may as well formalise the duopoly and make using Best Practice Software or MedicalDirector mandatory.
“It’s great that the Hunter New England and Central Coast PHN is trying to help local practices. And from what I’ve heard Cubiko is a really clever and useful product. But the constant use of products with limited integrations continues to reinforce the PMS duopoly for GPs.”
When asked about the issue of access for practices not using Medical Director and Best Practice, a spokesperson for HNEPHN told Health Services Daily they were aware of the problem and were trying to address it.
“The PHN will work with practices who don’t use one of these three products, utilising other mechanisms to support them,” said the spokesperson.
The only other possible issue with the deal is how practices deal with using Cubiko which is operating a tenant doctor model, and want to avoid any payroll tax issues.
Related
In some of the descriptions of how SAVI might work, the wording points to a practice optimising its whole business through the management of various operational aspects of a practice, which often might include things like optimising bulk/mixed billing rates, care plans and doctor scheduling.
All of that can get you into the net of a state revenue office wanting to levy payroll tax as strictly a practice wanting to operate a tenant doctor model must largely leave the GPs working in their centres to manage their own business.
HNEPHN was aware of the problem when asked and pointed out that any of the practices using their Cubiko-provided licenses can configure the software to ensure that only individual practitioners have access to the data, and that a practice does not use the product to do things like set billing goals, expectations of or procedure for billing, like care plans.
“[We] recommend that practices seek independent advice on the configuration of Cubiko to align with their practice model,” said the spokesperson.
