WETHERSFIELD — For 30 years, this health-care quality improvement company has faced next to no competition.
Qualidigm, founded in 1983, heavily depends on government contracts, and most of its work is collaborating with nursing homes, hospitals, visiting nurse organizations and others who serve Medicare patients, with the goal of improving the health of their clients. That work is paid for by Medicare, granted in three-year contracts, and Qualidigm has only had a competitor for two of the 10 bids.
Tim Elwell, who became CEO last April, came from a software company that sold a product related to electronic health records. Elwell, 53, spent his whole career in for-profit companies and took a pay cut to come to Qualidigm.
The vast majority of Qualidigm's business is government contracting, and Elwell was brought in to diversify its business. Last year, the company developed a software product called Qualiance, to help home health agencies comply with Medicare regulations. So far, about a dozen agencies, all in Connecticut, have purchased it, but they want to sell it nationwide.
About 54 percent of the company's revenue comes from three-year contracts to serve as the Quality Improvement Organization for Medicare in Connecticut. Now, Medicare is encouraging consolidation of these quality improvement contracts, and Connecticut will no longer have its own contract. Instead, the equivalent nonprofits in Rhode Island, Massachusetts and Connecticut are banding together to bid for all of New England. Currently, one agency in New Hampshire covers Vermont, New Hampshire and Maine.
"We're teaming up to go after his business," Elwell said. If they win the contract, Qualidigm would be a subcontractor, and Rhode Island's CEO would be in charge.
The 66 Qualidigm employees — eight in Rhode Island, who do Medicaid work, and the rest in Wethersfield — could potentially face a seismic change this summer, if someone else wins the bid for New England. While Elwell said he wouldn't have to lay off half the staff, he would have problems meeting payroll for all the statisticians, public health professionals, nurses, social workers and doctors as he worked to build up private clients. He said he would create a private company subsidiary, and recruit investors to help expand the consulting business.
Qualidigm's revenue peaked seven years ago at just over $10 million, when it did services for Medicaid that ended up going to another agency. Elwell said if it retains the Connecticut Medicare work, Qualidigm should reach that level again in 2014. He's projecting a 15 percent growth rate from 2013, which would require eight new hires. He's hoping for 30 percent growth in 2015.
Qualidigm's partners in health care hope the company retains quality improvement responsibility in Connecticut for Medicare.
Mag Morelli, president of the trade association that represents not-for-profit nursing homes, assisted living centers and adult day care centers, said she would have been happy to keep the status quo. If Qualidigm doesn't continue in its role, she said, "we would be losing something that has really brought a lot of value to the state nursing home level of care." She said their collaboration helps facilities to empower their staff, down to the direct care workers.
"They have a tremendous staff, they are phenomenal teachers," she said.
Anne Elwell — who has been with the firm for 25 years and is not related to the new CEO — speaks just as highly about the nursing homes' commitment to reducing the frequency of bedsores and reducing the inappropriate use of anti-psychotic medications for patients with dementia.
"They are so committed to doing the right thing, they really are," she said.
The proportion of dementia patients on drugs designed to treat schizophrenia and other serious mental illnesses fell from 25.8 percent to 22 percent from mid-2012, when Qualidigm started educating on the issue, to late 2013. Eighteen states improved faster.
Connecticut is still one of the worst-performing on this measure, ranked 38th in the country. Bedsore prevention efforts, which began eight years ago, have been more successful. In 2004, 13.3 percent of Connecticut patients, compared with 13.7 percent nationally, had the painful skin breakdowns. Now, it's 4.8 percent, substantially below the national rate of 6.4 percent.
The kind of data analysis Qualidigm does is growing more and more important in health care, as evidence-based medicine is encouraged by both private insurers and Medicare and Medicaid.
Anne Ellwell pointed to a journal article authored by eight Qualidigm employees along with scholars from UConn, Yale and Harvard's medical schools, public health schools at Yale and Harvard, and federal employees in health research. The article, published in the prestigious New England Journal of Medicine in January, examined the trends for Medicare patients in hospital-acquired infections, bedsores, falls, surgical complications and bad reactions to some common blood-thinners, a drug used to treat congestive heart failure and drugs to treat diabetes.
They analyzed about 200,000 records from around the nation and found that these problems had become less likely between 2005 and 2011 for heart patients but not among those who were hospitalized to have a surgery or for pneumonia.
Medicare is starting to penalize hospitals with too many re-admissions within 30 days, and Qualidigm is in the middle of that effort, too.
Connecticut Community Care is the hands-on agency meeting with Medicare patients before they are released, making sure they have a doctor's appointment scheduled within the week, and educating them about how to watch if they're getting worse.
Molly Reese Gavin, president of the agency, said one example is people with congestive heart failure. If their disease is not being controlled with diet, drugs and exercise, their limbs start swelling with fluid.
"If ankles start to swell, that is a red flag that there is something off in the way her medication is being managed, you know she's supposed to call the doctor," Reese Gavin said. Family members are told if their relative suddenly gains 4 pounds in a day, that's a sign of fluid retention, and they need to let the visiting nurse know.
Reese Gavin said Qualidigm's expertise and authority gets hospitals and nursing homes to buy into the program, and their view of systems-level problems helps CCC shape its own coaching advice.
Many of the staff have been with Qualidigm for more than 10 years, and Anne Elwell said they're excited about the way that medical professionals are becoming more focused on using data to examine practices and improve patients' health.
"Our employees are really passionate about what we do here," she said.