From Beantown Johnny: "Re: Nuance. Any truth to the rumor that there’s been a sales shake-up?" Not that I’ve heard, but I’m not well connected there. I always figure it’s safe to speculate on a sales shake-up since just about every vendor tinkers with that function now and then. That’s part of being in business and of being in sales. Life goes on.
From The PACS Designer: "Re: Oracle’s new offering. Oracle has released a large number of SOA solutions recently and now just announced another called Oracle Data Integration Suite. It offers a open, standards-based integration platform that connects heterogeneous data sources and applications." Link. TPD sure likes that Oracle stuff even though he’s an open source guy.
From Dr. CIO: "Re: advance degree. I don’t know why you are so hung up about advanced degrees. Personally, I would rather hire based upon experience and emotional intelligence rather than sheepskin. Example of no degree (undergrad) superstars: Gates, Ellison, Dell, Jobs … I rest my case." Well, that case you rested wasn’t made too well — nobody hired any of the folks you listed. We’d all agree that it makes little difference for entrepreneurs who start a company, but we might disagree on mid-level executives. Wanna bet that Microsoft, Oracle, etc. require advanced degrees for some jobs, rightly or wrongly, even though those founders don’t have them? And if your boss has one and you want to move up someday — think about it. I’m the poster child for educated but unmotivated, by the way, so I hear you. It shouldn’t matter, but then again, neither should good looks or connections.
From Brian Boyfanno: "Re: HIMSS. Can I sign up for your 2009 event now?" Jeez, didn’t we just have that? Nothing’s decided yet since it takes a sponsor, location, and all kinds of stuff. If there is an event, I’ll move you to the head of the line. I’m happy it’s already on your mind, though.
Johns Hopkins CIO Stephanie Reel is named as one of Maryland’s Top 100 women. I’m sure that’s a trivial honor compared to winning her HISsies CIO of the Year award a few years back. I expect she’ll e-mail her appreciation for that nearly any day now.
Listening: Awesome Color, Stooges-type (Iggy, not Three) psychedelic rock.
Did I maybe just forget that HIMSS has a CIO? Says it does here. I don’t know a lot of their folks.
Speaking of HIMSS, when did they get into the hard-selling, vendor-specific Webinar business? This one’s about PC FTP software, which seems like an odd thing for HIMSS to shill. Personally, I use FileZilla, which is free and works fine (my shillin’ is free).
I wasn’t interested enough to type the long organization names, but some group names a McKesson guy and a Wal-Mart guy as co-chairs of another big-named group. The press release is like a densely constructed stone wall that defies ocular penetration, but it’s got something to do with HIEs.
If you’re a LinkedIn user desperate for contacts, Inga and I approve all requests because we’re desperate for approval, too. Search on HIStalk and up we’ll come.
If you aren’t getting e-mail updates when I write something new, just plop your name and e-mail address in the Subscribe to Updates box to your right. You’ll impress your colleagues with your mastery of current HIT events.
Memorial Hermann will use OB waveform monitoring software AirStrip OB.
McKesson donates PracticePartner to Father Joe’s Villages, a non-profit supporting the homeless.
I’m really excited that just about all the healthcare IT vendors are turning in good numbers. It’s a tough market and apt to get tougher, but they’re looking good for now.
Former QuadraMed HR VP Donna Klein takes the same role at biologics company BioReliance.
Jobs: Technical Support Analyst (CA), Clinical Informatics and Physician Liaison (OK), Project Manager - Healthcare (GA). Weekly job alert signup.
IBM and Siemens will help hospitals reduce energy consumption, but only if they use MedSeries4, which should narrow the list down quite a bit.
I know it’s nerd heresy, but Microsoft and Yahoo don’t interest me much, individually or collectively. I’ve never used the search engine of either one, haven’t bought anything from either company in years (except for my $20 upgraded Yahoo e-mail account), and I could name a ton of much more interesting companies than those two wrinkling dowagers and their desperate, fumbling attempts to mate. At least that never-ending story is an alternative to the daily "gas hits a new high" headline.
Donal Quinn is named head of the diagnostics division of Siemens.
A UC Berkeley engineer moves most of the technology of medical imaging into a central server, allowing creation of a cheap, portable scanner that plugs into a cell phone. The scanner will be $1,000 and the whole setup around $70,000, making it viable in poor countries and rural areas.
The secret to running a health information exchange, according to two executive directors, is hitting up the state for money. The one from Maine says they’ll never be self-sustaining.
Bizarre lawsuit: a nurse brought in to fix Howard University Hospital’s ED after a reporter’s death there led to charges of mismanagement is suing the hospital for $4 million, claiming sexual harassment. She says the new doctor in charge of the ED referred to himself as "a pimp" and used unspecified derogatory terms for the ED nurses (that doesn’t take much imagination to figure out). She says he sent her flowers for a job well done, but signed the card BD, short for "Big Daddy," the name he insisted on being called by nurses.
And another: a patient hospitalized after her fourth suicide attempt is suing Medical Mercy Center-Clinton (IA) for worsening her depression. A nurse helping her to the bathroom allegedly told her, "You need to use a more lethal method. I’m sorry, I just hate it when people are a drain on society." The nurse apologized by letter, throwing water on the theory that doing so stops lawsuits.
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Inga’s Update
From Sparky: "Re: ASU WOW-mobile. It was wonderful to see my alma mater mentioned on HIStalk! I’ll take the opportunity to plug the ASU School of Computing and Informatics, which matriculated its first class of graduate students in biomedical informatics this past fall. The new program has recruited world-class faculty and is affiliated with the recently-opened Phoenix campus of the University of Arizona College of Medicine, the Translational Genomics Research Institute (TGen), and the Mayo Clinic in Scottsdale. Look for great research and great people coming out of this program in the near future.”
CSC opens First Consulting Group Viet Nam.
Sage Software’s profits beat analysts’ forecasts, up 9%, which matches its revenue increase. The company points out that the healthcare division that didn’t perform too well: revenues were down 11%, gross profit down 8%, and EBITA down 46%. Management says the numbers disguise a lot of the behind-the-scenes actions to turn things around. They have lots of physician users because of acquisitions, so it’s a big footprint.
Stratus Technologies names JJWild its Partner of the Year for the Americas sales region. JJWild has quadrupled their sales of Stratus’ ftServers to Meditech clients over the last year.
I voted for Mr. H as one of the “100 Most Powerful” in healthcare and hope you take a second to do so as well. He works hard and all he asks in return is that you read his blog. It would amuse him to potentially upset Modern Healthcare’s apple cart with a nomination.
HHS hands out an additional $600,000 to six new participants in the trial NHIN implementations. The new folks all represent good-size communities and include the Cleveland Clinic, Kaiser, HealthLink, Health RHIO, and Health LINC, and Community Health Information Collaborative
Picis announces the European launch of its Total Perioperative Automation solutions The Institut Mutualiste Montsouris has been working with Picis to customize the software for the French market.
I’m guessing that all those passionate Mac users out there will be happy to hear this news. EMR vendor Spring Medical Systems announces a new HL7 compliant interface with MacPractice MD PM’s system.
After reading about all the swanky new amenities at Henry Ford’s new West Bloomfield hospital, I am trying to narrow down what body-enhancing procedure I might have so that I can score a couple of nights’ stay. New rooms will have flat screen TVs, refrigerators, laptop computer tables, security safes, and a feng shui design to make patients feel connected to nature. Oh, and high-quality dining options, including 24-hour room service! Beats the Hampton Inn, for sure!
Eclipsys beat Wall Street’s expectation despite a Q1 net income that fell from a year ago. Due to some extraordinary costs, income was only $.01 a share versus $.04 last year. However, revenue was up 10%, and non-GAAP net income grew 25%.
There is a survey on the right asking if it is important that a hospital CIO have a Master’s degree in some field of study. I think we should have also asked if the responder had a Master’s – it would be interesting to see how that affected votes. I don’t know about CIOs in particular, but generally I believe having an advanced degree can’t hurt you. I think it can open doors (rightly or wrongly) and can be an indication of tenacity and ambition. It’s not a guarantee that a person is smarter or works harder than the next person, but if all other things are equal it, can’t hurt you. (And yes, I have an advanced degree and the greatest job ever… so there you go!)
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Inside Healthcare Computing has graciously agreed to make previous Mr. HIStalk editorials available from its newsletter as a weekly "Best Of" series for HIStalk. This editorial originally appeared in the newsletter in October 2006. Inside Healthcare Computing subscribers receive a new editorial every week in their Electronic Update.
Big-company CEOs have healthcare on their mind. I know that because they keep insulting us in the national media. We’re too expensive and we underutilize technology, they’re telling the world. It’s our fault that jobs are moving offshore, not their own corporate greed or inefficiency.
My first reaction: who do they think they are? We’re getting lectures on innovation, productivity, and cost control from GM? If I wanted that kind of advice, I’d go to Toyota.
Unfortunately, they’re right. The healthcare price increase merry-go-round has to stop eventually. Most of the job growth since 2001 was in healthcare, and that’s not something to be proud of. We’re leaving an expensive mess for our children to clean up just as Baby Boomers suck the system dry with their healthcare demands. If GM doesn’t like it today, they’ll hate it tomorrow, unless they’re watching the show from China or India by then.
Businesses want to force computers on us, dragging us kicking and screaming out of the dark ages. Unfortunately, software doesn’t automatically bring increased productivity and lower cost. If it did, all of those hospital dollars spent on Microsoft Office and Windows would have made us stunningly more effective instead of just giving employees something to screw around with as a pleasant productivity alternative.
I’d like to think that computerization can really reduce costs, but I haven’t seen it happen anywhere yet. I keep hearing about all of those showcase sites buying the latest and greatest, but the correlation to bottom line and quality outcomes is murky at best. Where’s the average 100-300 bed hospital that has seen its overall costs drop 30% because of software? You’d know them because every other hospital in town would be out of business.
Hospitals can cut expenses in three ways, all of them at their local level. They can manage labor, which is by far their largest expense. They can go after the utilization and cost of drugs and supplies. They can control physician practice variation. I’m glad I said “can” instead of “do” because, for various reasons, these things don’t happen. Software can’t fix them because they’re management problems, although given desperate enough circumstances, they could be fixed.
I’m glad much of our recent IT investment relates to patient safety and outcomes. I hope electronic medical records really do become a standard, with all the information sharing that the RHIO people keep yapping about. But when it comes to drastic cost reductions driven solely by buying and implementing software, I’d say that’s wishful thinking. There’s a lot of work to be done fixing the system and its underlying misaligned incentives before we even try to automate it. No business became a world-beater just by installing SAP, even if they were lucky enough to not be one of those that went bankrupt trying.
I do see a ray of hope in being called out by big-company CEOs. As hard as it is to have change forced on you, I think that time is here. I work in a hospital, but I’m also the occasional patient and medical bill-payer. When wearing those hats, I’m just as mad and frustrated with the system as those CEOs and I bet you are, too. Healthcare is too expensive, too bureaucratic, and too unimpressive in benefits delivered. As a software guy, I’m pretty sure that fix will take more than just people like me.
Mr. HIStalk’s editorials appear each Thursday morning in the subscribers-only version of Inside Healthcare Computing’s E-News Update. To subscribe, please go to: https://insidehealth.com/ihcwebsite/subscribe.html or call 877-690-1871.
From Devin Valencia: "Re: athenahealth. Not only did athena blow out numbers, they announced on the call they signed a national account with CVS/MinuteClinic." Q1: revenue up 36%, EPS $0.05 vs. -$0.55.
From Katrina Leskanich: "Re: TEPR. TEPR sent out an e-mail recently offering 2-for-1 registration and a free registration to anyone who previously purchased a ticket. Is there any question that they are having trouble drawing crowds? Attendance has been down for several years running and they look to be on their last legs."
From Moondogg: "Re: HIStech Report. It seems to be paid advertising." You’re partially correct. Vendors pay us to develop and conduct an interview with an executive about a specific product. I put it over there to make that clear. Still, we ask whatever we want and we conduct them just like our normal interviews, so vendors aren’t supplying the content. I think the result is a good read.
From Destiny St. Claire: "Re: Sage. I hear former Misys VP Jim Skladany is joining Sage as new West Coast VP of Sales."
From Visitor 211: "Re: layout. I noticed the banner ads go far down the page, beyond the article." We’re doing a little bit of redesign to improve the layout, so stay tuned. It’s definitely a (good) problem to have that many sponsors.
From Bradley Beeswax: "Re: Fletcher Allen. They’ve picked their man to run their $57 million Epic implementation." Link. Chuck Podesta, from Caritas Christi, is named CIO of Fletcher Allen Health Care (VT). He doesn’t have an advanced degree, I noticed, since that’s the hot topic here (and the subject of a new poll to your right).
My opinion: CIOs should have advanced degrees, not because the coursework will be used every day, but because it’s so easy to earn accredited MBAs and other degrees nontraditionally and inexpensively that I’m suspicious why a highly paid senior executive can’t be bothered to do it. A bachelor’s degree is like a high school diploma was 20 years ago and MBA studies have real-world relevance. Education is a standard bio entry and thus it drives first impressions. Heck, half the IT worker bees have advanced degrees these days. Still, I know exactly who’ll say what: CIOs without advanced degrees will say that nobody remembers their courses anyway, that hard knocks is the best teacher, and that they’re a shining example of why a bachelor’s degree is OK. Those with the degree will tell you how useful it is, why there’s no excuse not to get one, and how few hospital people make VP without a Master’s. Both will provide examples of great people without degrees and bad ones who have them. And in every case, whatever credential that person holds is exactly the minimum they would recommend for the job.
In Australia, Victoria’s Department of Human Services gets a bailout of $100 million US for its HealthSmart project, which is two years behind schedule and way over budget. Much of the core technology is Cerner Millennium, not that there’s anything wrong with that.
Jobs: HIT - Senior Internal Consultant (TN), Application Analyst II (VA), Soarian Clinicals Consultant.
Kaiser says its HealthConnect outpatient rollout is finished, with all 8.7 million enrollees having access, but inpatient is installed in only 13 of 36 hospitals. They admit to its $4 billion cost, which I believe was angrily denied when that number was first estimated by outsiders. Maintenance is $1 billion (!!). The hospitals and health plan announce a 64% net income drop in Q1 because of investment losses. Still, a $250 million quarterly profit for a "non-profit" in one quarter isn’t too shabby (imagine if they weren’t spending $1 billion on HealthConnect maintenance).
TriZetto’s CFO Bob Barbieri quits for "personal reasons" (probably because Apax had another "person" in mind to take his chair). I’ve never seen the "personal reasons" excuse laid on so strong as to put it in a press release headline, so naturally I’m skeptical. Maybe publicly traded company bean counters are too conservative for privately held companies.
McKesson’s Q4 numbers: revenue up 9%, EPS $1.05 vs. $0.85, beating expectations of $1.00. Technology revenue was up 19% to $806 million. Shares were up nearly 8% today. Nice.
A hospital information system company in India wins an IBM public sector award.
Say, wouldn’t it be a hoot if some anonymous blowhard was named one of the 100 Most Powerful People in Healthcare? You can nominate me here (by Friday). I’m sure the magazine people will squelch it, but what the heck. I’ll even helpfully show you what to fill in so the votes can be tabulated before being discarded scornfully - click the pic. I’m thinking I shouldn’t reserve the tux quite yet.
CMS is piloting PHRs in South Carolina.
Mobile systems vendor InfoLogix acquires Delta Health Systems, a cost containment consultant with an executive information system.
Strange: a woman Twitters her labor status in real time from a hospital.
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Inga’s Update
Members of the Connecticut State Medical Society can now receive discounted pricing for athenahealth’s PM service. Interesting to me is that the discount does not extend to athenahealth’s EMR.
VHA, Inc. claims to have provided member health organizations more than $1.3 billion in savings in 2007, which is more than any of its competitors. Revenues and operating income were up 7.5% and 8.3% respectively.
The 46-doctor Greensboro Radiology group will implement InterSystems Ensemble for its enterprise-wide integration platform.
The latest products earning CCHIT Ambulatory 2007 certification include Allscripts Touchworks 11.1; Cerner Millennium PowerChart/PowerWorks EMR V. 2007; Eclipsys Sunrise Ambulatory v. 4.5C (pre-market conditional certification); Healthport EMR v.9.0; and ChartMaker V. 3.0.5. Looking over the list of certified vendors, a couple of major players I’m not seeing include GE’s Centricity and athenahealth.
Privately held Greenway Medical Technologies announces a 52% increase in sales bookings for their fiscal quarter ending March 31st compared to 2007.
Concord Hospital in NH will use Juniper Networks for its network infrastructure. The network will include the connection of 11 total sites, including various healthcare centers, clinics, and physician offices.
CMS announces the six vendors participating in its physician quality reporting initiative. Allscripts, Anceta, Cerner, DocSite, eClinicalWorks, and NextGen are providing data pulled from EHRs to measure quality data reporting capabilities.
Intermountain Healthcare signs a multi-year agreement with Novo Innovations to enhance information exchanges between Intermountain’s hospital systems and physician practices without EMRs. Novo’s software is already being used to connect several affiliated practices with existing EMRs.
Japanese hospitals and clinics are not adopting medical records as fast as the government would like, with only about 10% of each automated as of February 2007. Thirty-one percent of the 400+ bed hospitals had an EMR, far less than the government’s 60% goal for that group. The primary barrier: cost.
Mediware reports more dismal financial numbers. Profits are down 62% from the same quarter last year and sales were down 52%. About the only thing upbeat was the CEO’s comment that the company was “executing plans to build a strong foundation for future growth.”
An Australian doctor recommends that the government pay up to $47,000 for kidney donations to resolve organ shortages. The rationale is that in the long run, thousands of lives and billions of dollars in care would be saved. Guess it would pay for a pretty nice vacation if anyone over here is interested.
I like the new health care van belonging to ASU’s College of Nursing & Healthcare Innovation. A $700,000 UnitedHealthcare grant paid for the WOW-mobile (stands for Wellness on Wheels) that will bring primary care services to underserved Arizona communities. The rest of the grant money, by the way, will be used for pediatric obesity and child-teen mental health programs.
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Photo: SF Business Times
I couldn’t wait to tell Mrs. HIStalk that I had just spoken to a doctor, a lawyer, a PhD in physiology and endocrinology, and astronaut. Then, to casually mention that it wasn’t a conference call, it was just one man - Don Holmquest, president and CEO of the California Regional Health Information Organization. The timing of our conversation was fortuitous since CalRHIO just announced an agreement with California’s association of retired public employees (CalPERS) to endorse CalRHIO for its members. CalRHIO is not your typical RHIO - it’s statewide, well supported, and cautious about seeking a business model that will keep it operating once the grant money is gone. Thanks to Don for making himself available for the readers of HIStalk.
Tell me about CalRHIO.
We started out in 2005 with the intent of becoming a state-level health information exchange. That’s a term used in a study that we’re a part of that AHIMA is doing, so it’s a comfortable term to us.
In California, we had the Santa Barbara local RHIO. There’s one down in Santa Cruz. Santa Barbara did a little bit of exchange. Santa Cruz has been doing for some time a push model of results and e-prescribing and other stuff. Those were clearly regional efforts. There was a sense that, for us to really get California involved in health information exchange, you needed a state-level organization.
We raised some grant money; spent most of it, frankly, doing base level consensus-building and education; and held multiple summits around the state and involved something like 60 organizations and about 1,000 people who participated in meeting and work groups. The end result of that was the creation of a non-profit California corporation and a board of directors of key executives from the various stakeholders. That entity is charged with going forward and creating this healthy information network. To my knowledge, nobody else is attempting that on a state level.
Is the work of CalRHIO mutually exclusive with the work of the local exchanges?
Absolutely not. Our position from the start is that we wanted to provide whatever we could to make life easier for local activities to develop and mature.
As we looked at it very carefully, we did a lot of interviewing of experts in the field, leaders, and vendors. I think it became obvious that the hardest thing is to pick the right technology platform and the financing.
That’s why we use the metaphor of a utility. If you try to take an undeveloped world and country and bring it into modern times, it would be nice if there was electricity out there for people to use. We are taking the problem of creating a good health information platform with all the right appliances and applications and privacy and security so that any region that wants to can use that as one of their building blocks.
There’s still plenty of work for the regions to do getting the local data providers to agree on data sharing, governance, developing the provider network, and so forth. We want to make it as easy as possible for these RHIOs to develop because, thus far in California, we’ve not had a lot of success in these regional efforts in getting to the point of achieving data exchange.
How many employees does CalRHIO have and what do they do?
We’re a pretty small shop. We’ve got about six people working on the core activity of building the platform that will do whatever we want it to do.
We do have one grant from Blue Shield to try and support some health exchange efforts in the safety net community. We have taken the money from Blue Shield and turned it around and made grants to three small safety net organizations.
For the most part, we have been working on trying to get the technology vendors selected and get the kind of endorsements it will take to make the business model work. That’s why you saw the CalPERS release recently. It took us quite a few months to get those guys on board. Once they finally understood what it was about, they did what they should do and what all purchasers should do, which is tell their health plans, “We want this for our employees.”
Describe what the CalPERS endorsement means.
What it really does is, from the most important perspective of all — the organization that has employees they value whose care they care about and whose cost they pay — it achieves that purchaser saying, "We want this capability for our members, we’re willing to pay for it, and we want you as our agent to support this and enable it." They are basically telling their health plans to sit down with CalRHIO and work out a deal.
Our health plans are not by any means the only payors we will look to for support. Anybody that makes use of our network and receives financial benefit will be expected to pay some appropriate share of the cost. If you look at an environment where you have hospitals using our network to distribute laboratory results or radiology results or whatever, then we would expect those hospitals to pay for that service. I can promise you it will be cheaper than what they’re doing now using faxes and printers and couriers.
Santa Cruz is doing push. In Delaware’s DHIN, they started with Medicity and Perot on the push part of it and will be moving to the information portal fairly soon. We decided to go the other way and start on the information portal and deliver that information to emergency rooms as a start. In that environment, the entity that benefits, in terms of better patient care and cost savings, is the purchaser, so that’s either a health plan or self-insured plan. If it’s an uninsured patient, then it’s between the hospital and patient who pays. If it’s a capitated medical group that has risk for emergency room services, they may be the entity that’s appropriate to pay for the information package that was delivered.
Some people would argue that the pay-for-use model discourages use and the philanthropic model makes more sense for a public good like an information exchange.
I wish it were possible. I don’t believe it is. We’ve not found a good example of where that’s worked. If you can show me anywhere in healthcare where a substantial body of services is being paid for by philanthropy indefinitely over the long term, I’d love to hear about it.
Frankly, I don’t see many states out there that have money to spend on this. Certainly the federal government has taken a position, for the most part, that health information technology is like plumbing and air conditioning – it’s part of the cost of doing business and, if you’re a medical group or hospital, you’ve got to pay for it.
I’d love to see that, but we don’t think it’s possible. We’ve got a state here with 37 million people and the eighth largest economy in the world and there’s nobody stepping up to do that. We had some early philanthropic support, and when you talk to them about doing something longer term, the position we’ve heard most often is that, “We’ve really enjoyed giving you seed money and it’s great what you’re doing, but you can’t keep coming back to us.”
The original projection was that CalRHIO would need $300 million to build the network. That cost is upfront before you can start collecting usage fees. Where will you get that upfront money in a tough credit market?
You’ve got to show a very robust business model. You’ve got to show that you have organizations that have contractually committed to paying for the information you deliver and you monetize that.
There are very smart people out there who know how to raise money for a good project. Lot of interest in things that are infrastructure in character, lot of interest in healthcare … it’s probably one of the few growing parts of our economy and, as you know, it’s going to grow for a lot of decades.
Everybody is interested in something that saves money. There are few strategies out there than you can go to, other than a health information exchange, that’s a pretty solid likelihood that you’re going to save money. I’ve seen PET scanners and MRIs and all sorts of procedures that folks have hypothesized are going to save money, and the feds will tell you that none ever do. But if you look at putting more information in front of a doctor when he needs it, there are some pretty solid studies that say you’re going to save money.
The Smart Health board member said those savings estimates for health information exchanges are overestimated, even though he wasn’t against the concept. Do you agree?
No. I know the man. I’ve been to some of their meetings. You’ve got to remember that this is a set of interviews occurring at the time of shutdown of one of the early regional RHIO efforts and I’m sure they’re all very disappointed about it. They tried hard to get people to see the benefit.
I think what that tells you is that it’s harder to show demonstrable benefit when you’re starting on a small scale, one project at a time. They’re trying to get one small region, maybe three or four hospitals and some other groups, exchanging data. It’s a lot harder to demonstrate savings and improve quality than doing it over 338 hospitals and 98,000 physicians.
So I think in that context is probably why that particular individual was making that comment. He’s a CEO, a very smart guy, and on the board of a big system here. If you read further in the article that quoted him, he still says it should be done. You can’t take just part of it out of context.
Back to the previous question, what kind of organizations would be interested in financing CalRHIO’s upfront costs?
This sounded a lot easier six months ago, nine months ago, but hedge funds, private equity groups … right now, there’s not a lot of deals on the street. There’s a lot of money out there that needs a place to go. If you offer a rather new opportunity with a solid business model and a solid need, I can tell you the advisors we’re talking to is that it’s easier to get more money than less.
We’re not looking for huge quantities. We’ve actually had conversations with people with that kind of money. Some are very interested in doing well by doing good, so those are the people we’re predominantly looking to. I’ve not found anybody yet who’s said that they couldn’t find that money. It’s probably a question of the cost.
Given David Brailer’s former and current job, I would think he’d be interested.
We know David pretty well. His office is about a mile and half away. He’s a good friend of many of our stakeholders. My sense is he’s largely focused on for-profit companies, particularly those that are moving toward a liquidity event of some sort, or are early stage and need that extra round of capital to go to the next level. Investing in a non-profit where your only return is interest – I just don’t know. If I were David, after all he’s been through, he might be very careful.
So you’re talking about servicing the debt, not offering equity?
Right. Let’s be real clear about what we’ve said about the $300 million. That is the pool of capital that will be needed, according to our very detailed planning, to get us to the point where revenues exceed expenses. So we’re looking at borrowing that high-risk, high-interest capital initially to kick things off. We start building on our Phase I delivery to emergency departments.
But at some point where we now have assets and revenues that meet minimum requirements, we will, as quickly as possible, turn to tax-exempt bond financing. We’ve had conversations with the financial advisors to those issuing authorities. They like to issue bonds for the right reasons. As soon as we can, we would move to that — pay off the high debt we got started on, then we would be run on tax-exempt bonds. Burning through, if you will, something less than $300 million, our projections are at that point that we will be self sustaining and will continue to pay that debt back. At some point we will be debt free and we will be sustainable.
How does CalRHIO snap into place with national efforts?
The national effort is laudable and it will be great when someone is seen in an emergency room in California and they’re from Missouri. It will be great if we can get their information from Missouri.
I would predict that the flow of information inbound or outbound across state lines is going to be a small percentage of the critical information that passes among communities in the state. California doesn’t have very many border cities where the community spans a state line – maybe Reno. So we think the first problem we want to solve is the needs of Californians who find themselves someplace they didn’t expect to be or sick when they didn’t expect to be and their information is available. If they happen to end up in New York and somebody there pings the national network and we can supply the feed for that, that would be great.
We see that as quite a bit further down the line. You’ve got to get California connected first. Youv’e got to stimulate the creation of regional communities if that’s how it ends up going. Quite honestly, I’m not sure every region will spontaneously create its own RHIO. It may be a task we have to take on. We have fairly substantial cities here in California that have no RHIO effort underway at all. We will probably have to go into that community and build the equivalent of a regional RHIO to get information up and running. If we can get the state connected, then we will clearly be delighted to push that information over the national network and pull in information.
It would seem that you have an advantage since local RHIOs are usually led by at least two strong competitors that don’t trust each other.
Absolutely, absolutely. If you take a multi-hospital system — and we’ve got some here in the state that have 30-plus hospitals, some with more than that — for them, if they can get into an information exchange environment that spans multiple communities, then that distributes the risks from various competitors because the benefits far outweigh any one competitor that might be out there. We think that’s a strong benefit.
At some point, presumably, with the Sutter system, Catholic Healthcare West, Tenet, Kaiser – those entities are competitors, but my belief is that ultimately these institutions will do what’s right for the patient. I know there are competitive issues out there, but at some point, the sheer good outcome from this will outweigh those competitive interests and at some point, hopefully, the public becomes educated about how important this is and simply is not going to tolerate those kinds of self-focused concerns.
Should information exchanges be a back-end utility without consumer involvement, especially with regard to privacy?
We sort of favor the consensus approach. We have a board that includes a little bit of everybody, including the most recent president of AARP. We have a lawyer on our board from a privacy advocacy organization. We have union representatives, hospitals, medical groups, IPAs, multiple hospitals, hospital associations, and health plans.
We think everybody that’s got a stake in this needs to be listened to, have an opportunity for influence. We will operate the fundamental utility, but it has to be governed by the appropriate policies. That’s the first thing we’ve done is that high level stakeholder governance body. The second step is to build the tool that you’ll need to get where you want to go.
Can data sharing projects succeed without an overhaul of state and federal privacy regulations?
It certainly would be easier if we had a more uniform approach to privacy. We’re prepared to live with what we’ve got right now. Standards aren’t perfect and privacy laws are imperfect and often inconsistent and that makes it difficult. We don’t think you can wait until all that is resolved.
Frankly, I think it will be easier to resolve when people can see why it’s important. Right now, patients find their paper records that were buried in paper silos are now buried in electronic silos. They’re worried about privacy and privacy is a huge problem with paper medical records.
When people can see that the health information exchange can protect their privacy, probably better than what they experience today, but at the same time, give them access to their medical records whenever they need them, wherever they’re scattered … I think it’s a question of time, this incremental process back and forth, back and forth – it’s iterative. One small baby step at a time, get smarter, get better.
We take an approach that we are not going to be a standards-setting organization. We’re not even going to be a strong enforcement organization. In order to connect to an important data source and have to deal with interfaces that are non-standard, with HL7 versions that are far from up to date — we will do it. We will encourage people to be as up to date as possible and use the current standards, but our job is to get that information and move it into the appropriate format and get it flowing to where it should be. Over time, I think we will move to some consistency.
To your original question on privacy, we are going to take as conservative approach as we possibly can. We don’t want to foul even the most conservative of requirements. We can talk about opt-in, opt-out, and the advantages and disadvantages of each. We are going to be using basically an opt-in on an event-by-event basis so that every time that a patient is seen and there’s an interest or need in getting their information, the providers will not even be able to search for it until they have the consent of the patient to search for it.
Once a list of what their information is and where it’s located is obtained, we will again get their consent before we pull information from each of the sources. They could say "this is fine, this is fine, but don’t get my information from this facility – it’s not relevant or I’d prefer to keep it private." That lets you get started while the whole country comes to some sort of equilibrium about what’s the balance between access and privacy.
I assume there’s break-the-glass capability for emergencies.
Assuming that’s what the law permits, and of course HIPAA does, absolutely. You can’t function in an emergency environment if you can’t get past the patient who’s comatose or unconscious or irrational or whatever. Yes, absolutely — we’ll have the break-the-glass option.
One shaky information exchange could have a breach that would cause headaches for all of them. Is there a need to have them become covered entities or to be overseen by some third party to ensure standards?
The simple answer is yes. We would be comfortable with that.
We’ve been using the metaphor of being a utility, but frankly, one of the characteristics of a utility that we’re comfortable with is oversight, accountability, and regulation. We’re going to be moving data around and getting it from other RHIOs. It would be great if we had high confidence that they have met the appropriate level of performance and reliability.
We kind of think that health information exchanges do need to measure up. That having been said, if you look at AHIC or HITSP or CCHIT that’s talking about certifying exchanges. We’re comfortable with that, although I certainly hope we don’t do something that makes it less likely that we’ll get viable exchanges going. It’s hard enough the way it is.
Frankly, for me personally, I really think that we win when we get state level RHIOs getting information flowing in their states without any extra burdens on them. The national exchange is going to be great benefit, icing on the cake, really wonderful — but it won’t happen until we get a lot of state level RHIOs out there up and running.
How important was your choice of technology partners to the overall strategy?
Somewhere between very important and critical, obviously. If you pick the wrong technology platform or company or strategic partner, you’re asking for trouble.
We looked long and hard and we did something that was pretty unusual when we did our RFP. We asked for various vendors to give us three things: give us the technology – that’s what everybody is used to doing. #2 was, "Tell us what the business model is that, with your technology, would lead to a sustainable endeavor." And #3, "Where do you get the money to get it started?"
So you had to have technology, you had to have a business model, and you had to have a financing model. Frankly, that was very hard to pull out of vendors. It’s expensive for them to develop that kind of proposal. Many of them don’t have the resources or the experience and many of them said “We’ll bring you this wonderful technology and all you have to do is write a check for it.” That’s a little too simplistic for us.
We think,"If you’re so smart, come to us with a way that your model that actually will lead to the people of California having an exchange that’s very successful." We found Medicity and Perot and they believed they could do it, and so far, they’ve been doing it.
What interaction will you have with personal health records?
I think that remains to be seen. First we’ve got to figure out what a personal health record is. There’s lots of ideas about that. They sound wonderful. I would love to have one. Every time I try to create one for myself, I run out of time and interest.
We don’t think they will be practical until somebody other than the patient is putting the information into that record in a reliable way. Of course you have to permit the patient to interact with it – add stuff, comment on stuff, and correct stuff. It will be challenging to figure out what that is.
I think the interesting thing is that the health plans are very interested in these as competitive features, competitive benefits for the plan. We think we will be interacting with these personal health records — first, probably, in the context of one or more health plans who have that as one of the features they offer. So, we will all learn together how to do this. But again, you get back to the same problem. It’s a health information exchange, you have to identify the patient, you have to find the information, you have to move it to where it’s supposed to be.
What have we learned from RHIOs that failed without ever exchanging a single byte of information?
The number one lesson is that it’s not easy, that it’s not sustainable from philanthropy or even government grants. That will help you get started, but what we believe is the right way is to focus first on the business model.
Getting something up quickly that’s exchanging information is a lot of fun. You can show it to people and people get very excited about it, but that’s not necessarily scalable. We think it makes you lose focus what the real issue is – the reason we’ve had so many RHIOs fail is that the business model is very difficult to build, implement, and perfect. That’s where your focus has to be.
To get to that business model, you still have to have that stakeholder consensus, stakeholder support. You’ve got to have the right message. You’ve got to get everybody you’re going to depend on on your side. That’s why we went to the third largest purchaser in the United States, CalPERS, and said, “Let us tell you what we’re proposing to do and see if we can get you to endorse it and, in fact, support it with your own dollars.”
From your vantage point, what’s the state of healthcare and healthcare IT?
[Laughs] Have you got a couple of hours? I remember when Uwe Reinhardt gave a talk some years ago and said, "If you look at the United States in terms of healthcare, we’re really two countries. We’re a very wealthy country with the best healthcare in the world, but at the same time, we’re a Third World country where a huge number of people get far worse care than they’d get in Cuba and maybe even Nigeria."
It’s our own Secretary Leavitt who says, “We don’t have a healthcare system, we have a healthcare industry.” It’s a mosaic of the best in the world and the absolute absence of good care. In that environment, what you’ve got is really good healthcare information technology and very old healthcare information technology and, in the case of many, many physicians, you’ve got zero health information technology.
One of the things that’s so important about a health information exchange is that, in our opinion, the electronic medical record in the average physician practice will be greatly enhanced when you can enhance the information flowing into it. The most valuable information in a physician office electronic medical record is the stuff that comes in from the outside. Otherwise, it’s just your own reflections and the stuff you put in there to remind you the next time you see the patient. I think once that kind of information is available, it will be far more attractive to physicians to go ahead and move into the modern world and get some electronic information technology.
I think we’re probably still seeing overkill in what we see going into physicians’ offices. Not that all that decision support and so forth isn’t useful, but it’s too expensive for the average doctor. We have a huge, hospital-owned practice here in Silicon Valley. Their CIO tells me that not only did their electronic medical record cost an average of $50,000 per doctor, but that’s about what they spend every year just to keep it upgraded and to operate it. That’s not going to work for your average doctor.
As the CEO of the healthcare foundation here in California said in one talk, people are out there trying to get doctors in their offices to use convection ovens when what they really need is a toaster. We need something simple and inexpensive. It needs to be supported in an ASP model, automatic upgrades, doctors need to not have servers in their offices, not have to deal with IT issues. It’s hard enough to practice medicine and get your bills out and pay the staff. The health information exchange will make that a much more valuable tool for doctors.
From Frazier Thomas: "Re: Misys. I read the the Misys press release about Daughters of Charity. Vern makes a reference, twice in fact, to Daughter’s Of Charity ‘Hospital’. I wonder if he even knows there is no such Daughters Of Charity HOSPITAL? It’s a whole health system, Vern. I guess I should cut him a break. He’s probably got a whole lot on his mind wondering what kind of employee he’ll be for Glen."
From Labrat: "Re: Baylor. The shake-up is true and relates to a conflict of interest issue. The BHCS rumor mill suggests that criminal charges could be pending."
From Up to You: "Re: NAHIT. More info on NAHIT and its stasis following Scott Wallace’s departure at the end of March. Includes some info on the organization’s financials, too." Link (although Modern Healthcare, despite carpet bombing the industry with free paper copies, inexplicably locks its online version behind registration, so you may not be able to read it).
From I-Wish: "Re: paper. Today I visited a new doctor. I downloaded my CCR-compliant medical history from my PHR to an encrypted memory stick. I arrived 10 minutes before my appointment time and handed the memory stick to the receptionist, who uploaded my medical history into the office EMR. I was immediately taken back to the exam room to see the doctor. Then I woke up!! In reality, I arrived 30 minutes before my appointment, filled out 20 pages of information that required me to put my name, SSN, DOB and insurance number on every page. I then waited an additional 40 minutes to get into the exam room and spent nine minutes with the doctor and was out the door and done! I have been working in Healthcare IT for 15 years now and nothing seems to have changed in the average doctor’s office for the $ billions spent. My dream is to have one doctor visit in my lifetime that does not require a piece of paper! I am a baby-boomer and it doesn’t look good. Maybe for my grandchildren?"
From Terminal Stare: "Re: CIO credentials. Have you noticed how many new CIOs don’t even have a graduate degree these days? No clinical credentials and minimal education - remind me again why they’re paid more than doctors?"
Thanks to HISJunkie, whose HTP/RelayHealth tip gave HIStalk readers the news at least 12 hours ahead of everyone else. Transaction processor HTP and its 65 employees will stay in Columbus under the RelayHealth name.
McKesson will pay $13 million in civil penalties for failing to report suspicious pharmacy sales of controlled substances to the DEA.
University of Michigan Health System finishes its online order entry project, claiming a 29% reduction in medication errors and a 40% drop in turnaround time for urgent meds. None of the press releases mentioned who their vendor is and the intrepid reporters didn’t ask that painfully obvious question, but I believe it’s Eclipsys Sunrise Clinical Manager.
McGill University develops an automated anesthesia system it calls McSleepy that continuously monitors and adjusts anesthesia doses in response to patient conditions. Pretty darned cool.
This ought to get Deb Peel stirred up: UCSF not only inadvertently opens up patient information over the Internet, it does so while sharing patient data with a for-profit company that targets potential hospital donors. UCSF admits turning over information on 31,000 patients over several years to Target America. It paid that company $12,000 a year to match patient names against lists of known donors, board members, and community service supporters (as well as street addresses) so the rich ones could be hit up for donations (what the marketing types call "receiving our messages and ongoing communication"). Information about 6,000 patients was open to Google searches for three months. UCSF didn’t announce its problem until six months after it found out. Too bad Britney wasn’t on their list - they could have scored a nice privacy gaffe trifecta.
Former Deloitte manager Maria Russo will join Jewish Hospital & St. Mary’s HealthCare (KY) as CIO.
Wal-Mart will make some kind of big healthcare announcement Monday morning at 8:30 Eastern. It must be about prescription pricing since the company’s $4 generic guy is on the agenda.
NovaRad signs a RIS/PACS deal with a 1,500-bed hospital in India.
LMS Medical, the Canadian vendor of the CALM patient safety software for OB, will delist its shares from AMEX, but continue trading them on TSX.
Highly annoying: you get a teaser e-mail headline about some "10 Biggest Career Suicide Moves" or "5 Most Important Technologies You’ve Never Heard Of," so you get suckered into clicking the link. When you get there, it’s some idiotic vanity cartoon presentation that you have to click through one page at a time. I don’t have the time or interest in sitting through some crappy video, podcast, or slideshow. I like to skim, not be held captive, even though web guys keep trying to turn the Internet into TV (which I don’t watch for the same reason). There’s no video or audio on HIStalk for a carefully thought out reason: those are for people whose lips move when they read. You’d need at least 60 minutes to get what you could read on HIStalk in five. That extra 55 minutes is my gift to you.
St. Jude Medical signs a deal with Microsoft to work on integrating data from implantable devices with HealthVault.
Strange: a 56-year-old musician in a Steely Dan cover band dies of liver failure after being turned down for a transplant because of marijuana use. His use of it, ironically, was medically approved for his hepatitis pain.
Fresenius Medical Care (Germany) earns CCHIT ambulatory EHR approval of its Acumen EMR software for nephrologists.
Senior citizens are apparently doddering fools who require a SeniorPC, a dumbed down offering from Microsoft. "Think of it as a simplified way to do it all: e-mailing, word processing, plus managing prescriptions, finances, travel planning and photos. There are even word games and number games for keeping the puzzle skills sharp." Yep, Grandpa can just sit back in his drool-covered Barcalounger in his Sansabelt pants and Velcro tennis shoes and punch the optional oversized keys to order prescription refills, do crossword puzzles, and look at pictures of dead relatives, pretty much life’s rich bounty for those in God’s waiting room, at least as Microsoft apparently sees it. Maybe there’s a large print option for games, porn, and celebritard gossip for the more tuned-in geezers. Getting old sucks, but you don’t have to go down without a fight.
Six more organizations get ONCHIT money for NHIN demonstration projects, including the financially strapped Cleveland Clinic and Kaiser Permanente.
E-mail me.
CalRHIO
By Kipp Lassetter MD, Chairman and CEO of Medicity
Regarding the reader comment about CalRHIO, I’d like to set the record straight for HIStalk’s readers. Having won the CalRHIO selection process, I can say that Medicity has never been asked to “pay” CalRHIO anything. What we did offer CalRHIO as part of our RFP response was assistance in building a sustainable model and with network development activities with the expectation that we would be paid back with the success of the network. Their has been ZERO financial exchange between CalRHIO and Medicity or between any of our anticipated subcontractors (Perot, HP, etc.).
We do understand that while we were willing to go “at risk” for our services, other vendors were proposing large fees to cover these activities with no guarantee that the activities would be productive or successful. We feel we prevailed because we were the most qualified to partner with CalRHIO. CalPERS recently has performed extensive due diligence on the CalRHIO business model and value proposition. For those readers that are not familiar with CalPERS, they are the third largest purchaser of health care services in the nation and currently have around $250 billion under management for the benefit of their members.
Both the national healthcare consulting firms of Watson Wyatt, and Mercer were involved in evaluation effort on behalf of CalPERS. The fact that CalPERS came to the decision to “DIRECT” their health plans to participate is far more than CalRHIO “hype”. There is an old country saying that summarizes the comments very well: “the dogs bark, but the caravan moves on".
Bar-Coded Medication Verification
By Laureen O’Brien, CIO, Providence Health & Health Services, Oregon Region
I recently read the Brev-IT commentary about bar-coded medication verification (BMV) systems that claimed they are "generally primitive, hellishly difficult to implement, and badly designed from a nurse workflow perspective". I can agree with only one of these claims — they are hellishly difficult to implement.
These systems are anything but "primitive," as they integrate information from multiple systems (ADT, pharmacy, nursing) to allow the use of technology (barcode readers) to quickly validate the "5 rights" of medication safety (right patient, drug, dose, route and time) to prevent medication administration errors.
And what is required to gain this safety after BMV is implemented? The nurse must sign on to the system or scan his/her ID badge, scan the patient’s wrist band, and scan the barcode on the medication. Within seconds, the nurse knows the "5 rights" have been verified or knows there is a problem.
When fully implemented and fully utilized, these systems are proven to enhance patient safety and reduce the risk of medication errors. Granted, implementing a new task into the nurse’s work flow adds time to their already busy schedule. But in healthcare, since when is taking more time to do a task safely considered an unacceptable workflow? I would think that doing something unsafe would require workflow adjustments to correct the unsafe practices.
Try to find a patient who will argue in favor of the nurse not practicing safe medication administration so the nurse had a better "workflow". I’ve scanned the literature and have yet to find that argument. There are lots of articles that speak to nurses getting around the BMV systems and the safety they impart. Why are these discussions so often referenced? We know that use of a BMV system can and does prevent medication errors.
It is 2008. These systems have been available since the late 1980s. There are really no good excuses for not implementing them.
If your hospital is not doing BMV and not planning on doing BMV, shame on you. Your long-term financial status may be in jeopardy, as informed patients start looking to facilities that do use safe medication practices. You know that BMV systems provide enhanced safety, your board knows it, and the public is becoming more educated daily.
Hellishly difficult to implement? You bet, but no more so than implementing any clinical IT system. It is implementing change. Change is difficult. It is also the right thing to do.
