Healthcare IT vs. Corporate IT
This is in response to an April 29 reader comment suggesting that healthcare IT leaders are unable or unwilling to make decisive decisions that would improve the bottom line.
I don’t think it’s always not making a “responsible” decision on the part of the HIT leadership. There are different priorities in healthcare organizations versus us in the corporate world.
In the corporate world, we in IT are well aligned to the profit motive of our company. Period. In healthcare IT, leadership is often not worried about that profit motive. They say they are, but the other departments we serve — they say they are worried about finances, but they really aren’t. HIT leadership doesn’t want to have a crucial conversation with the department heads in the healthcare system about their wasteful applications.
The infrastructure is normally fully under the control of HIT leadership. There is a ton of cost cutting that happens there. Way too much in my opinion, causing unnecessary downtime that would never happen in a corporate IT shop. That’s due to the cost cutting to not have that switch stack be fully redundant or we don’t need to buy ALL that storage area network growth space now … and then you run out. I’m looking at you HIT shops in the North Carolina Tobacco Road region.
The real HIT waste is in the applications. Nearly every health system I’m familiar with have some pretty serious application redundancies. What I mean is an HR department that runs both Kronos and Lawson and the payroll department is not part of HR and not outsourced to ADP or the like. That’s two very expensive systems that can do the same job if someone can tell or convince HR to just pick one.
Or better yet, just let someone else run that whole part of your operation. Many of the corporate IT guys handled the payroll / processing / HR system cost issue a long time ago via outsourcing. Then HR can focus on, oh I don’t know, recruiting people and working on benefit plans. That doesn’t seem to be all that common in healthcare IT.
Also, your hospital maintenance departments run very expensive name-brand systems meant to run whole manufacturing operations. To do what? Inventory objects and print out repair orders. I’m not talking about your medical device department here, just good old facilities and services.
The list of applications that cost serious dollars and do only small jobs inside the healthcare operation as a whole goes on and on. Corporate-based IT shops would have had a programmer build a little Web application or SharePoint portal to eliminate a few hundred little apps inside a typical healthcare IT shop.
There’s not a lot of movement in HIT shops to simplify. Simplicity equals cost savings in both break/fix and maintenance/purchase dollars.
Why not focus on those applications particularly that need simplification and save costs?
I believe it’s political costs mainly in the healthcare IT field. Those department heads often hold much power in an organization. Healthcare IT is not the sole owner or, at minimum, the first owner of the application. That department or unit is. They can claim patient benefit or employee benefit, or most often, that the redundant systems allow them to have their own inflated head counts.
Will a healthcare IT leader have time to quantify those patient benefits into a dollar measurement to then justify the maintenance cost and support/time cost for that application? No. Who has that kind of time?
There are often redundant departments in a healthcare operation. Health systems have DBAs/report writers creating reports for clinicians, but there is a whole other Decision Support Services department with their own specialized application. Nine times out of 10, it’s the same data being reported in almost the same way, and let’s not talk about that DSS app and how it gets the data every day or night and the integration and support work there. In some shops, those DSS people with limited SQL writing skills will even tug some of that DBA’s time to help with their work.
In corporate IT, there is one measure — efficiency measured in real dollars. There are no patients, so the hard math is easier to quantify. How much does that application cost to have support, maintenance, and upgrades purchased? OK, that’s $100. What does it save us in time running the business vs. another application/process? We are in the positive side in $1,000s — it is justified. There isn’t a lot of worry about the business unit’s politics other than making sure their process is as lean and efficient as possible and that usability of the application is good so that the process time is as efficient as possible.
That’s not to say that a corporate business unit doesn’t have its own political pull, but often you can show the C-level the numbers and those numbers win the argument. Proof in the corporate world means something. I’ve been in many healthcare IT ROI discussions showing the cost savings that could happen. They are normally hundreds of thousands to millions when you take into account the database licenses at the infrastructure layer also. Healthcare IT leadership still passes. It’s not their priority to go against the department heads.
Internal politics are everywhere. In healthcare, political might can win an argument when the proof in dollars are staggeringly in support of the other point.
I’d say this is changing in healthcare IT as many organizations are having their bottom line get worse and now some of those golden goose political situations are getting weaker.
The dollars of cost argument is winning the day here and there. It’s just the wins are only on small projects and applications to show the cost saving committee that we saved $50K. That’s for show. The real cost saving opportunities that exist are hundreds of thousands in savings.