Top News

Athenahealth will acquire Proxsys, a Birmingham, AL-based vendor of front-end revenue cycle tools that include medical necessity checking, insurance verification, pre-certification, referrals, and facility scheduling. The all-cash deal is worth up to $36 million. Athenahealth says it will use Proxsys technology in its newly announced athenaCoordinator service, which will move patient and insurance information between hospitals and their affiliated physician practices in return for a per-transaction fee. ATHN shares are up almost 10% Thursday in after-hours trading following the release of positive Q2 numbers and news of the acquisition. Share price has nearly doubled in the past year, giving the company a $1.69 billion market cap.

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Reader Comments

From Scrambled CIO: “Re: software conversions. We are in the middle of a lot of system replacements and consolidation. I am amazed at the estimates and fees associated with a flat file conversion from SCC Soft Computer. Three hundred hours for a pathology conversion.” I assume you’re converting “from” rather than “to” SCC, in which case they have little incentive to give you a deal knowing you don’t have an option and your wounded former-customer indignation won’t matter anyway. It’s funny that I was describing exactly that scenario to someone at work today, where you’ve told your vendor that you’re dumping them down the road and they stop returning your calls and price everything at list-plus-larceny. It’s like an ugly divorce – if you had known how cold and vindictive your spouse could be, you’d have insisted on a pre-nup or maybe married someone else. But I don’t know the particulars in this case, so in fairness to SCC, I’ll just say “unverified” and assume there was a rationale for the price quoted.

From Crabby: “Re: ARRA’s legacy. it will not be widespread adoption of EHRs. but rather the technical standards that ONC has laid out. They will do more for our industry, patient safety, and adoption than any sexy interface or legislation could ever do. Access to complete patient data across the continuum of care will be enough of a reward for a provider to login. Once logged in, we must make it easier for him/her to click the buttons than to bark at the nurse.” No one expected ARRA to be a panacea and fix all of HIT’s flaws, but incorporating standards should reap some benefits. Yep, there is still more work to do.

From Jamie: “Re: Berk Smith. The Dell Healthcare VP/GM resigned Wednesday after 22 years at Perot Systems and Dell. He’s leaving for a startup.” Unverified. I e-mailed a Dell press contact, but haven’t heard back.

From Emily: “Re: 3M Health Information Systems. Another round of layoffs last week following another poor quarter of sales.” Unverified.

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HIStalk Announcements and Requests

Highlights from HIStalk Practice this week: the ever-witty and irreverent Dr. Joel Diamond reflects on technology over the past decade. Highlights from AAFP’s 2011 EHR User Satisfaction Survey. digiChart’s new CEO suggests the company is prepping itself to be acquired some day. Patients feel disrespected by their doctors.  Canadian docs express familiar-sounding complaints about EMRs. Almost 70% of practices are looking to become a PCMH. In honor of Oscar de la Renta’s 79th birthday (or just because), feel free to sign up for the e-mail updates while you are checking out the hottest ambulatory HIT news.

I am now on Google+, though I haven’t figured out what it’s going to give me that I don’t already have with Twitter, Facebook, and LinkedIn. However, if you feel the need to be in my circle, send me an invite.

Unrelated except to music fans: an influential but seldom-acknowledged musician of the 60s and 70s died this week. Grass Roots lead singer Rob Grill was 67. I actually saw them live well past their heyday in a bar holding maybe 25 fans and chatted with them while getting a beer. They still sounded good playing I’d Wait a Million Years, Temptation Eyes, Sooner or Later, and Midnight Confessions.

On the sponsor-only job board: Senior Enterprise Hospital Sales Executive, Senior C#/.NET Developer, Configuration Architect. On Healthcare IT Jobs: Informatics Analyst, Senior Systems Engineer – Windows Server Technology, Senior Director of Applied Clinical Informatics, Vice President of Client Services.

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Acquisitions, Funding, Business, and Stock

athenahealth reports Q2 revenues of $77.9 million, up 33% from 2010. Non-GAAP adjusted net income was $7.9 million ($.22/share), compared to 2011’s $4.1 million. The company beat analysts’ estimates of $.18/share and revenues of $75.08 million.

The provider of MyMedicalRecord PHR announces an agreement that gives a Chinese venture partner warrants to purchase up to four million shares of its stock. Sounds impressive until you notice the share price is $0.04, valuing the big international deal at $160,000.

Private investment firm Veronis Suhler Stevenson acquires hospital financial analytics software vendor Strata Decision Technology, which claims 800 hospital customers that include Allina, Catholic Healthcare West, and Cleveland Clinic.

Express Scripts will acquire its prescription drug benefits competitor Medco in a $29.1 billion deal. The companies, whose combined revenue is $110 billion, say they’ll be able to lower costs and improve health with their combined drug purchasing power.

Microsoft’s Q4 numbers: revenue up 8%, EPS $0.69 vs. $0.51. beating consensus earnings estimates of $0.59. Windows revenue slipped for the third straight quarter, while Office revenue was up 8%.

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Sales

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Parkview Health (IN) signs an agreement with Streamline Health Solutions to upgrade six of its hospitals to accessANYware v1.9.

Northrop Grumman will partner with Verizon and Wellpoint subsidiary National Government Services to develop predictive modeling technology for CMS’s National Fraud Protection Program. CMS announced last month that it had awarded Northrop Grumman the $77 million fraud detection contract.

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People

Clinical integration and search technology provider Apixio names Steve Roberts its VP of sales and Jenny Field its director of product marketing. Roberts is a former VP of sales for NextGen; Field was director of ambulatory medical informatics for Salinas Valley Healthcare System.

Former Healthland president and CEO James Burgess takes over as CEO for Advanced Health Media.

HFMA president and CEO Richard L. Clarke will retire on July 31, 2012.

Jason Bray is named CIO of Oklahoma State University Medical Center. He was previously CMIO of the OSU Center for Health Sciences.

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Announcements and Implementation

Summa Health System (OH) deploys BIO-key’s fingerprint biometrics for authentication with Allscripts Sunrise Clinical Manager platform.

PHR vendor Dossia announces its Health Manager health management system, which it says will improve the health behaviors of its users through personalization involving games, social dynamics, incentives, and messaging. Dossia chair Craig Barrett says it represents the next generation of PHRs.

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Government and Politics

CHIME chimes in on proposed changes to HIPAA, saying the standards would be difficult for providers to meet and should be scaled back. CHIME claims the rules rely too much on technical capabilities that are not widely available and fail to acknowledge the amount of human intervention necessary to achieve compliance. Of particular concern is the proposed requirement for providers to create a consolidated report that documents all incidents of PHI access within a designated record set.

The VA and Department of Defense were charged with developing overall integration between their organizations at a Chicago demonstration project for the first Federal Health Care Center, with some EHR integration due October 1, 2010 (single sign-on for clinical staff, single patient registration, and orders portability). A GAO report says they missed the date for the first two items but those are live now, but they’re struggling with lab orders. Pharmacy order integration has been “indefinitely delayed” and five pharmacists were hired to manually verify orders between the two systems and to check for drug-drug interactions. The GAO says they’re struggling because of the same old problems that always come up: “lack of an integrated and comprehensive project plan from VA and DoD.”

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Other

The Women’s Health ABU at Cerner breaks out into a dancing flash mob during lunch at Cerner headquarters. Diners included Cerner associates, about 100 new hires, and over 40 clients. All I have to say is I want to be part of a dancing flash mob one day.

Core Health is running its annual HL7 Interface Technology Survey for CIOs/CTOs, IT managers, and HL7 professionals. They did a nice job last year. Respondents are entered in a drawing for a ThinkPad tablet.

Weird News Andy is on the tail of this story, which he summarizes as, “His butt, her end as a CNA.” A nursing assistant is fired from her job at a transitional care facility and faces voyeurism charges after taking pictures of a male patient’s buttocks, which she described to a co-worker as “too funny,” and posting them on her Facebook.

WNA also fell for this story from England: a disabled man who falls out of his wheelchair in a hospital’s parking garage just 100 yards from its ED has to wait 25 minutes for paramedics to be sent from the other side of London. A bystander claims hospital nurses refused to help and said they aren’t allowed to treat patients outside their areas, although a hospital spokesperson says no such rules exist and nurses have responded to garage emergencies previously. 

Data integration software vendor Informatica and the IT division of Hospital Corporation of America are embroiled in a legal squabble over software license fees, with Informatica claiming HCA owes it $6.3 million following a license audit. HCA interprets the scope of its license differently and disputes the claim.

Cayman Islands Health Services Authority CIO Dale Sanders tells me that they’re re-competing their Cerner contract, with the core vendor tender here. If it were me, I’d plan the install for January and watch the resumes flood in from cold-haters more than willing to spend the winter there at discounted rates.

A 34-year-old Australian woman who died immediately after visiting a physician for an ear infection is found by coroners to have experienced an allergic reaction to the antibiotic Ceclor, prescribed for her by an 85-year-old “computer illiterate” doctor who did not notice her documented allergy on the screen. The doctor has since given up his license and sought psychological counseling. 

An indicted New Jersey couple who sold medical students and licensed physicians a $5,000 medical licensing exam test prep course that included stolen questions remains on the run, while their student-customers, most of them foreign medical school graduates, are being asked to defend their scores by re-test. Several have already failed and may lose their medical licenses. The National Board of Medical Examiners got suspicious when the wife took the USMLE exams several times and scored low, with a surveillance camera review showing her taking pictures of the computer monitor.

Researchers in Brazil find that tweets containing the word “dengue” correlate to local outbreaks of dengue fever, the disease that kills hundreds of people each year there, allowing authorities to identify geographic areas of outbreak and respond more quickly.

A 27-year-old hospital nurse in England is arrested after insulin was injected into IV bags in a storeroom, killing five patients.

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Sponsor Updates

• Sunquest Information Systems hosted a “Build a Bike” team-building event at its user group meeting last week. Fifteen bikes were donated to local Tucson charities.
• United Regional Health Care System (TX) signs an enterprise license agreement for iSirona’s device connectivity solution.
• TELUS expands its Canadian EHR ecosystem with the connection of Optimed Software Corporation’s AccuroEMR to TELUS Health Space.
• CareTech Solutions announces that 14 of its clients were named Most Wired 2011 Hospitals. Five more were named Most Improved.
• Billian’s HealthDATA interviews Gail Donovan, EVP/COO of Continuum Health Partners about the economic challenge of providing high quality care and outcomes.
• Besler Consulting’s George Porette offers analysis on Medicare DSH and uncompensated care reimbursement in The Besler Beacon, the company’s quarterly newsletter.
• Awarepoint’s Q2 bookings beat 2010’s numbers, increasing its hospital client count to 153.
• Medicity’s Novo Grid is ranked the #1 private HIE solution by KLAS, the position it has held since the category was first reported last year.
• Porter Hospital (IN) will install the iConnect image operability solution from Merge Healthcare.
• Tulsa Spine and Specialty Hospital (OK) selects ProVation MD for physician point-of-care documentation.
• Jennifer  Lyle, CEO of Software Testing Solutions, will serve as a Meaningful Use panel presenter at the iHT2 Health IT Summit in Denver next week.
• Southwest Mississippi Regional Medical Center chooses Wellsoft’s EDIS for its two hospitals.
• Thomson Reuters and CareEvolution expand their partnership to deliver the Thomson Reuter’s HIE Advantage solution, which leverages CareEvolution’s secure interoperability solutions and Thomson Reuters’ analytics expertise.
• The 40-provider Philadelphia Hand Center contracts for the SRS EHR.

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EPtalk by Dr. Jayne

I was intrigued by the item in Monday’s Sponsor Updates regarding the Surescripts White Coat of Quality program. I have to admit not being familiar with it, but was able to find its Web site. Frankly, I’m surprised to see that only four vendors were given this recognition for 2010. To quote directly (including grammatical and spelling errors) from the Surescripts website:

The criteria for earning a White Coat in 2010 was, by design, very straight forward:

1. Provide a signed commitment from company leadership affirming their organization’s commitment to quality.
2. Measure quality metrics as specified in the published industry guidelines and report those metrics each month to Surescripts.
3. Implement changes to software that address issues identified in quality reporting. Take steps to eliminate any issues measured in #2 above.
4. Raise prescriber awareness through training.

As a provider, this seems like a slam-dunk. I’m not sure why more vendors aren’t on the list, especially some of the larger ones.

I was flipping through Health Data Management while watching HIPAA training and a McKesson ad aimed at independent physicians caught my eye. It grabs the reader with “I didn’t survive my residency to be an I.T. Manager” and says solutions are “arriving fall 2011.” The ad features an older gent with some pronounced hair loss.

To me, this ad seems aimed at either (a) physicians who are the last-ditch holdouts for putting off EHR implementation, or (b) those that hoped they could retire before someone forced them to bite the bullet and go electronic. Nothing new on the Web site, so I suspect this is just marketing rather than something truly transformational. Maybe it’s a discount for AARP members.

Speaking of independent spirits, a colleague cornered me in the doctor’s lounge waving an article on usability from American Medical News, reminding me how much he reveres his paper charts.

(I still don’t quite understand what the AMA is doing with this publication. They offer it in both print and digital versions, but the same article has different publication dates. I understand the Web version is going to come out before the snail mail version, but can’t we at least use the same dates, hmmm? This was dated June 20 online and July 11 in print for those of you who are playing along with the home game.)

Anyway, the article doesn’t tell us anything we don’t already know regarding usability. Guess what? Vendors are trying to reduce click counts, de-clutter screens, and save us from alert fatigue among other not-so-small feats like being certified for Meaningful Use, transitioning to 5010 and ICD-10, and so on.

The piece mentions CCHIT’s five-star usability rating as a tool some vendors use to differentiate themselves. Wondering if this is anything like the above-mentioned White Coat of Quality, I wanted more information. (I’ve been deployed on stable systems for some time and have a low tolerance for boastful sales practices, so it’s been a while since I’ve played the system / vendor selection game looking at it through the eyes of the average user.)

The CCHIT Web site seems clunky and vendors are not in alphabetical (or any other seemingly rational) order. I never did find a list of those products that had received the five-star usability rating, although a Google search brought up lots of individual vendor listings, many of products I wasn’t familiar with. Maybe my search skills are deteriorating or maybe it was the effects of too much fruit of the vine while watching what might be the saddest web-based HIPAA training I’ve ever seen in my life as I apply for staff privileges at a new hospital. Still looking for the list – can anyone help a girl out? E-mail me.

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Contacts

Mr. H, Inga, Dr. Jayne, Dr. Gregg.

The views and opinions expressed in this blog are mine personally and are not necessarily representative of current or former employers.

PoléPolé (Slow Slow)

3:21 a.m.

Zero degrees and our Camelbacks turn to ice 2,000 feet below Kilimanjaro’s summit. Five days of steady marching behind us. Almost home, but struggling.

Team chatter is eerily silent. Heads hung low and lamps dim, distraught climbers from other groups turn around short. Fear and doubt slither through our minds. Can I make it to the top? Will I be the one who fails?

“Angels We Have Heard on High” pierces the silence. Sensing our internal turmoil, the guides sing a familiar melody that shatters our foreboding. The crescendo of “Gloria” generates a second wind. Spirits lifted, we proceed with renewed vigor towards the prize.

Panting with joy, we crest Stella Point at sunrise. We pause on the volcanic rim, a mere 750 feet from the peak. We will make it. All of us. After a brief round of hugs, we persevere towards the summit.

Without a word, the four founders quickly move out and up the line of march. We conquer the final stretch together. Kilimanjaro was our collective idea, our blood bond, thus important and symbolic to finish together. After more hugs, high fives, and requisite pictures at the peak, I cry, hard.

Thirty-six hours later, we shower and settle in at the Arusha Hotel bar to celebrate. Debriefing over beers, we relive the climb, tell stories, and share leadership lessons learned. I gladly share them with you:

Fortitude. Mental toughness is only honed via trial and refined by fire. No amount of mental gymnastics can prepare you like reality can. Don’t throw in the towel in tough circumstances. Put one leg in front of the other and move forward.

Training. A person rises to his level of training, not to his expectation. No exceptions. If you don’t make the time to train, you don’t make the team – period. Over the year, most climbed smaller peaks in preparation.

Gear. Reaching the top requires the right gear. No amount of training or exhortation can close the distance between success and failure when you are ill equipped. Invest in yourself and the team. A lack of gear equals climbing failure.

Vulnerability. We threw out titles before taking the first step. Administrators, presidents, physicians, and teens were now peers. Spending 24×7 with strangers requires a rapid adoption of transparency. The first day, we peed from a distance and behind some trees. Come day two, we’d grown beyond these formalities.

Encouragement. Maximum performance is nearly impossible without a pat on the back from a friend. Kind words work like salve on a wound.

Nutrition. You can fake your way and run on adrenaline for a day or two. But without sustained energy, you will collapse. Leaders must replenish themselves routinely.

Attitude. Zig Ziglar’s adage proved true: “Attitude, not aptitude, determines altitude.” No one benefits from listening to naysayers. Good leaders present good attitudes, even when they feel like vomiting.

Teamwork. Individuals caring for individuals, together. Shared hardships hasten lasting bonds.

Planning. Although the journey took only seven days, we organized over seven months. Anything worthwhile requires diligent strategic and tactical planning.

Support Team. We had an incredible support team comprised of friends and family. On the mountain, we had guides and porters.

Two lessons I’m still trying to internalize:

Climb High, Sleep Low. Reaching new heights requires giving up some ground. We spent a couple days where we gave back more elevation than we conquered. Although ‘straight up’ seemed the shortest distance, a sheer, vertical route would lead to breakdown. Every mountain has its peaks and valleys. Embrace these.

PoléPolé. To reach the highest summits, take time to acclimate at various heights and simultaneously build endurance. If you rush, the odds of success diminish exponentially. Sometimes you must go slow to go fast. Be in the moment. A leader must shrink the gap between frontrunner and laggard without losing sight of the ultimate objective or compromising passion.

We unveiled our corporate flag in front of the summit sign. This band of ruffians brought together 11 individuals and over the course of planning and execution built a team. The Kilimanjaro success rate is 60-70%, but we achieved 100%. Success demanded leadership and followership.

That rock taught us a lot. Changed us. Did someone say Everest?

Ed Marx is a CIO currently working for a large integrated health system. Ed encourages your interaction through this blog. Add a comment by clicking the link at the bottom of this post. You can also connect with him directly through his profile pages on social networking sites LinkedIn and Facebook and you can follow him via Twitter — user name marxists.

Vitalize Consulting Solutions has signed a definitive merger agreement that will make the company an independent, wholly owned business unit of Science Applications International Corporation (SAIC), the McLean, Virginia-based government contracting firm. Terms will not be disclosed in the announcement, to be issued later this week.

Vitalize CEO Bruce Cerullo told HIStalk that SAIC pursued the acquisition to support its strong position in government healthcare IT. The Department of Veterans Affairs is considering commercial healthcare IT products, while the Coast Guard has already contracted for software from Epic Systems. Vitalize, with 600 consultants and annual revenue of over $100 million, runs one of the country’s largest independent Epic practices, Cerullo said.

”Meaningful Use will normalize, but will follow with ICD-10, HIPAA 5010, and Accountable Care Organizations. We want to play hard in that arena,” Cerullo said. “SAIC has great tools and methodologies they want to bring into the commercial world and we want to move into government.”

Cerullo said Vitalize’s leadership team and organizational structure will not change. Its headquarters will stay in Reading, MA with offices in Kennett Square, PA and Santa Ana, CA.

“We’re committed to bringing together the best of Vitalize with the best of SAIC,” Cerullo said. “We’re going to go slow. SAIC is growing at 8-10%, while we’re growing 100% year over year. They know what we’re doing is working.”

He added, “Vitalize has been part organic growth, part acquisition, and I suspect we will do more of both. We’re swapping private equity owners for a strategic owner. Our organizational structure, benefits, compensation, sales, and practice-oriented structure will remain.”

Completion of the transaction is expected in August.

Top News

The FDA releases draft guidance on the oversight of mobile medical applications. The two categories of apps that would qualify for oversight include those that serve as an accessory to an FDA-regulated device (for example, one that connects with a PACS) and those that turn a mobile platform into a mobile device (the smart phone is used as an EKG device.) In some cases, software developers would have to demonstrate that their mobile apps work comparably to their non-mobile versions.

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Reader Comments

From Vince Ciotti: “Re: Epic’s 75 wins in 200+ bed hospitals. All of Epic’s clients are multi-hospital IDNs since ‘normal’ community hospitals simply can’t afford their epic fees. Judy won’t even condescend to bid to single facilities under 200 beds. If the typical multi has 5-10 hospitals, that represents about 10 wins for Epic. Still, at their incredibly high prices, this was enough to drive Epic to over $800M in revenue last year. Add in the hundreds of millions in hardware fees even bigger implementation ‘consulting’ fees they generate and Epic alone may represent our long-lost economic recovery!”

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HIStalk Announcements and Requests

Thanks to Inga for capably holding down the fort while I was away. It was good to be gone and almost as good to be back. I’m behind, but that’s not unusual – the only change is that I’m determined to stop feeling guilty about it since it’s too many jobs, not sloth or lack of time management skills, that’s responsible. I’d go part time at the hospital if that was feasible.

Listening: the first new Yes album in 10 years. I’ve been a fan for much of my life and I saw them live not long ago, so I like it even as I acknowledge that prog rock isn’t everyone’s cup of tea. Reading: Life by Rolling Stone Keith Richards (excellent, either he and/or his hired gun co-author is a genius), so I may need to crank some B-side Stones.

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Acquisitions, Funding, Business, and Stock

Healthcare Growth Partners releases its quarterly HIT market report, with merger and acquisition activity recovering well from low activity a couple of years ago. Here’s a quote:

Generally, sub $100 million companies have three valuation inflection points: proof-of-concept, initial scalability, and expansion scalability.  Proof-of-concept is value created when a company shows that its product can be successfully sold and deployed in a commercial setting.  This inflection point is generally of more value to venture investors than it is to acquirors, as companies at this stage tend to be too early to realize significant value through a sale.  Initial scalability occurs when an earlier stage company begins to show strong profitability at high levels of growth,  although the organization is still small and lean. Expansion scalability takes place after a company has matured to a level where it takes on real infrastructure, and the company begins to show strong profitability after building out a mature corporate organization. 

Although the size of a company at each inflection point can vary significantly based on a company’s product or services and sector, the general rule of thumb in HIT is that proof of concept occurs at revenue of less than $1 million, expansion scalability in the $5 to $10 million revenue range, and mature scalability in the $20 million revenue range.

Philips reports Q2 numbers: revenue down 2.6% and a loss of $1.9 billion, with the CEO announcing cost reductions and share buybacks. Its healthcare business fared better than the company overall, with an 8% sales increase.

Apple announces Q3 numbers: revenue up 82%, EPS $7.79 vs. $3.51, wildly beating analyst expectations of $5.82. The company sold more than 20 million iPhones and 9.25 million iPads in the quarter.

Shares in WebMD Health recovered a bit on Tuesday following Monday’s drop of more than 30%, which was triggered by the company’s announcement of lowered revenue expectations. The one-year share price graph looks merely unimpressive until you notice that the straight vertical line to the right is not the margin of the graph.

Lawson Software, whose $2 billion acquisition by Golden Gate Capital and Infor was completed last week, has begun restructuring and employee layoffs.

Australia’s federal court approves CSC’s acquisition of iSoft for $202 million after 97% of shareholder votes were cast in favor of the proposal.

A major player in HIT consulting will announce its acquisition later this week. I’m holding back specifics until the announcement comes out. It’s going to be a pretty big deal (no pun intended).

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Sales

ADVANTAGE Health Solutions signs an agreement with IGIHealth for its ORBIT Clinical Exchange and portal to support ADVANTAGE’s ACO infrastructure.

Children’s Medical Center Dallas selects the Enterprise Data Warehouse business intelligence tool from Health Care DataWorks .

Final Support chooses EMR-Link from Ignis Systems to provide lab-EMR integration for its GE Centricity customers.

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People

The board of Franciscan Hospital for Children (MA) fires CEO Paul J. DellaRocco, citing financial irregularities that include the inappropriate submission of expenses.

Former Allscripts COO Eileen Martinson is named CEO of Sparta Systems, a provider of quality and compliance management software.

RTLS vendor Versus promotes Susan Pouzar to VP of sales.

Practice Fusion hires Zachariah Gursky as its first VP of ad sales. He was previously with Coupons Inc.

Todd Cozzens is promoted to CEO of Accountable Care Solutions, a new business unit of Optum. He was previously with the company’s OptumInsight business, the former Ingenix that bought Picis, of which Cozzens was CEO. He mentions his new job and some thoughts on “virtual Kaisers” and their data needs in his latest blog posting.

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Announcements and Implementations

The Georgia Health Information Technology REC selects Halfpenny Technologies to develop a lab hub demonstration project for the exchange of clinical data.

Banner Health (AZ) completes its pilot of MyHealthDirect and will be implementing the service across all its facilities. This news clip explains how Banner is using MyHealthDirect to book appointments at low-cost clinics and thus reduce unnecessary ER visits and wait times.

Middle Park Medical Center in Kremmling (CO) begins implementation of Healthland’s EHR and anticipates a go-live by the end of the year. The 19-bed hospital expects to qualify for up to $250,000 in EHR incentives.

Johns Hopkins Medicine begins recruiting for over 60 people to implement Epic. Positions for the initial ambulatory rollout will focus on clinical documentation, analytics and research, and scheduling and registration.

LodgeNet Interactive restructures LodgeNetHealthcare into an independent but wholly-owned subsidiary. Gary Kolbeck, who was previously GM of LodgeNet Healthcare, will serve as president.

Microsoft establishes a Web page for Google Health users interested in transferring their data to Microsoft’s HealthVault record. The site includes step-by-step instructions on how to move the data.

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Government and Politics

HHS’s Office of Inspector General finds that 12 of 13 states do not plan to verify all the eligibility requirements for paying Medicaid EHR incentives to doctors and hospitals . The reason: most states lack the data necessary for complete verification because data collection requires too much effort and too many resources.

The federal government files a complaint against a Kentucky nursing home for fraud, but also alleges that five residents died from “worthless care.” Nurses were accused of failing to administer diabetes meds, diapering patients who had normal bladder function, ignoring physician orders, and not showing up at all for one 2.5 day period in which the nursing home had no RN coverage at all.

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Innovation and Research

The Industrial Designers Society of America awards Silver recognition to Seattle-based Artefact for its design work on the prototype of the Seattle Children’s Patient Information System.

Use of a real-time alerting system for patient deterioration reduced LOS 9.7 to 6.9 days and increased clinician response from 29% to 78% in a UK study. The $1.5 million Patientrack system was developed by an intensivist in Tasmania, but no Australian hospitals were interested in trying it. The weak link seems to be that it requires the nurse to manually enter the vital sign values.

The VA offers a $50,000 prize to a developer who implements Internet-based technology similar to the government’s Blue Button program, which allows patients to download a summary of their health records. The competition started Monday and ends when a winner is chosen or on October 18, whichever comes first.

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Other

According to the local paper, independent physicians wanting to tie into Lee Memorial Health System’s Epic EHR would have to pay $15,000-$16,000 for the software license plus $25,000 to $80,000 per practice to cover implementation fees. Annual maintenance is an additional $4,500 per provider. Depending on the size of the practice, that could be a hard sale. Independent physicians in the area control about 84% of outpatient care.

UPMC removes 29 of its 51 directors following a consultant’s recommendation for improving the board’s effectiveness. Its membership had swelled over the years as representatives were added from acquired hospitals.

Memorial Health System (CO), the hospital whose electronic patient records were breached by a city-employed nurse and part-time psychic, says it has fired 22 employees in the past three years for privacy issues. One of them was caught looking up the records of friends so she could create a birthday database.

Odd: a woman sues a Pennsylvania hospital and the county child protection agency when her newborn baby is turned over to foster care after testing positive for opium, which the mother blames on her own ingestion of poppy seed-containing salad dressing. Both organizations had been sued by another mother a few months ago for exactly the same thing, except that particular mom blamed a poppy seed bagel.

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Sponsor Updates

• MEDSEEK announces its fifth consecutive year on the HCI 100 list, based on its 2010 revenue performance.
• Sentry Data Systems CMO William Kirsh DO, MPH participated as a writer and editor for a HIMSS Revenue Cycle Task Force white paper.
• Surescripts recognizes  Allscripts as one of seven vendors to achieve Gold Solution Provider Status for e-Prescribing. Surescripts also awards e-MDs its White Coat of Quality.
• AdvancedMD announces the release of its ONC ATCB-certified EHR 2011 solution that includes an enhanced patient portal, new Meaningful Use reporting tools, and utilities for submitting immunization and health surveillance data.
• API Healthcare is offering a variety of sessions on creating more effective workforce management at its annual user group meeting this week in Milwaukee.
• Orion Health’s Rhapsody Integration Engine and Rhapsody Connect earn ONC-ATCB EHR module certification .
• Providence Health & Services selects Elsevier / CPM Resource Center as its vendor of choice for evidence-based clinical content.
• Concerro releases a series of white papers collectively called the Workforce Management Wellness Series.
• Kony hires Peter Buscemi to lead the company’s global marketing efforts.

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Contacts

Mr. H, Inga, Dr. Jayne, Dr. Gregg.

Who’s On First?

Recent O’Toole Law Group engagements have raised a critical issue that’s worth passing on to HIStalk readership.

When providers contract with vendors, they expect certain products and services. This much is obvious. The issue presented here arises as a result of all the distributing, bundling, packaging and rebadging of products.

Vendor A may offer Vendor B’s product alongside its own products. In this case, Vendor A is a distributor (and usually a reseller) of Vendor B’s product. Typically this type of collaboration exists when the two products perform related tasks for the provider. Like ice and your favorite drink, each is good, but together they are great!

Vendor X may offer a product called “TurboEMR” that also has some type of label like, “powered by HISware” or something to that effect. This probably means Vendor X has HISware’s software embedded in its product, and the “powered by” refers to this fact. In this case, Vendor X is sublicensing technology developed by HISware.

In each situation, the provider gets the package deal and the functionality it is seeking, which would not be possible with only Vendor A or Vendor B in the first instance or with only Vendor X in the second.

So everyone wins, right? Hopefully, but maybe not.

When things go well and you have a great prime vendor that really steps up and fills that role, life is good. The provider gets precisely what they signed up for. They have a single point of contact for resolution of problems with any of the products involved.

But what happens when things go wrong? Are the responsibilities and procedures clearly set out? Key contract components that must be addressed fully by all vendors involved include support obligations, copyright / patent protection, indemnification, and liability provisions, to name a few.

How does the provider determine exactly what they are getting and precisely whom they are dealing with?

One simple way to determine the “who” part is to look for the warranty of ownership. Something like, “Vendor warrants that it owns the software.” Once you find that section, really analyze it. It is probably not more than a sentence or two, three tops.

If the vendor warrants that it is the developer and sole owner of the technology being licensed, then you are dealing with a single vendor and its products. This is the cleanest, most simple scenario.

(Quick sidebar here: it must be a warranty, not a representation. Warranties have certain protections and remedies that representations do not.)

If the vendor warrants that it is the owner of the technology OR that it has the right to license it, that is your red flag duct taped to a flashing light. This is not bad, but it means the product contains or is packaged with third-party software. You need to be aware of this and you must obtain certain crucial contract terms for your protection.

The best-case scenario (keeping in mind that there is another vendor involved that is not a party to your agreement, which is the reason behind this article) is a warranty from the vendor that you are contracting with that it has warranties of ownership, operation, and error correction (for example) from the other vendor. This is critical because it can then be used to back up the same warranties from your selected vendor to you.

The biggest warning flag you could ever encounter is where there is a disconnect in the protection(s) offered. If the vendor warrants that “all software is great and works fine and they will fix everything, but this warranty does not apply to a certain line item or product,” then you have a problem. What happens if there is a failure with the excluded software?

If you have no answer while reviewing contract language, just imagine the discomfort you will feel if your system is down and all indications point to the excluded product.

OK, stay with me here. All the legal stuff aside, what those in IT really want to know is what happens if there is a problem with the products.

As stated before, with a solid prime vendor you are in good shape. But what about those unfortunate situations where fingers get worn out from all the pointing?

To try and avoid heartburn later, fix the contract up front. Try this simple exercise. Remember connect the dots, those partially finished pictures in coloring books with numbered dots? Connect them in numerical order and complete the picture! Give it a try with your software agreement.

If you have more than one vendor involved, just imagine a system crash, and then try to connect the dots to all the vendors, especially the vendor behind the scenes. Do you have adequate warranty protection? Do procedures exist for escalating a software problem to the correct level at the vendor? Can you get to the vendor at all??

Make clear for each product included, or component thereof, which vendor is responsible for support, updates, fixes, etc.

Make certain that you have contract pathways to obtain that service. Assume vendor A is first point of contact. When the problem ultimately is identified as residing in Vendor B’s product, then what? It may be that the responsibility remains with Vendor A, but it also may be that Vendor A is only responsible for “Level 1 Support” and then you go to Vendor B for the difficult stuff. Ideally Vendor A stays involved and shepherds the issue through to resolution, sort of like a new car warranty. Inga’s Cadillac dealership did not build the car, but when the car breaks down, you take it back to Inga’s to get it fixed. Inga’s then takes care of the work required and is backed up by the manufacturer.

Taking the car analogy a little further, in terms of your contracted vendors, while you may know who is in the driver’s seat, you may not know who else is along for the ride. It could be an awesome two-seat Tesla roadster with two great vendors, or it could be the mud-covered SUV with a bunch of buddies all saying they work together just fine (and the driver is wearing really dark shades.) Due diligence in contracting pays off, and lack of diligence can really sting you later.

Vendors, please make it clear. You know best what is going on. Put it right out there.

After 20+ years doing this, I still remember a situation where an executive at a monster hospital chain felt something had been “snuck in.” In reality it was not, but the impression stuck hard and fast in this executive’s mind and we had to face extra scrutiny for several years to follow. Kind of like a dog that gets whacked by something at one of those birthday parties where twenty kids are running around screaming and things get zany and someone hands a whiffleball bat to the kids for the piñata. Anyway, the dog gets whacked (accidentally, of course) and never forgets the kid that did it. Don’t be the kid with the bat!

Tangential issue: get a warranty that states no other software is required, from your prime vendor or any other vendor, for operation of the software products being licensed. If other software is required but not included, require a listing in the agreement of all such products. Failure of your prime vendor to include something on this list should mean the vendor has to pony up and pay for it. That will bring all the fine details right to the top.

Finally, once you get everything above all set, make sure that all your hard work does not blow away in the wind because a vendor subcontracts work or assigns the agreement to another vendor. Include provisions prohibiting assignment or subcontracting without the customer’s agreement. That way you know what you are getting, from whom you are getting it, and that things will stay that way unless you agree otherwise.

Please take care in your interpretation of this article. I have been involved in countless good situations involving multiple vendors and very happy customers. When the provider does get a good prime vendor that truly takes on its role, you win. No question it works well in the right situations. My point is to be diligent and try to avoid bad situations by at least having good contract language on your side. The combination of a poorly performing vendor and weak or lousy contractual support will really ruin your day.

Big takeaways:

• Contract language, warranties, and obligations should be consistent as applied to all products and vendors involved, even if designated to a prime vendor. Watch for disconnects in supporting language.
• The contract should map out clearly the support chain and obligations of the vendors involved, again, even if designated to a prime vendor.
• Require listing all software required for operation of the products being licensed and obligation for the vendor to provide whatever they failed to list.
• Prohibit assignment and subcontracting by the vendors without your consent.

This article is intended to provide general advice and is not by any means exhaustive on the issues or language required and must not be taken as specific legal advice. Hopefully HIStalk readers enjoy the presentation and take away a valuable lesson or two.

William O’Toole is the founder of O’Toole Law Group of Duxbury, MA.