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Monday Morning Update 3/23/09

March 22, 2009 News 8 Comments


From Francisco Respighi: "Re: Sutter. Sutter is mothballing its $1 billion (and counting) Epic project, blaming the economy. After Mills Peninsula, no new hospital implementations are planned. In the announcement by CIO Jon Manis, Sutter does states that individual affiliates may press ahead if they come up with their own plans and funding – this allowing Sutter to avoid a headline grabbing announcement that explicitly states the obvious: the Epic project is gigantic bust." Kudos to the anonymous reader who tipped us off early this month that the project scope had changed. I don’t know that the project is necessarily a bust, but I do know that when John Hummel was CIO there, he was explicit in saying that Sutter’s clinicians would not use CPOE or other doctor-centric technologies in his lifetime (and he’s alive and well, albeit with Perot). Sutter was talking the project up two years ago. It’s odd that the corporate office won’t pay for the systems, but its individual hospitals are welcome to, which usually implies some kind of "corporate IT isn’t providing value" issue since it’s the same money regardless of which pocket it comes from. Capital funding seem to be the problem, so they must not have bought licenses and hardware up front.

Here’s the full text of Sutter’s internal announcement, provided by a reader: SUTTER HEALTH COMMITTED TO THE EHR; ROLL OUT TIMELINE CHANGES DUE TO ECONOMY. Given the current economic downturn, Sutter Health is revisiting its capital investment plans to make sure it is balancing the needs of our patients and communities, the uncertainties of the economy and the realities of a changing health care environment with our goal of remaining healthy, viable and successful over the long term. In addition to assessing timelines associated with facility construction and imaging projects, Sutter Health is adjusting the timeline for its integrated electronic health record (EHR).Our immediate focus continues to be our first hospital implementation at Mills-Peninsula Health Services in Burlingame, CA and our three remaining medical foundation implementations. We’ve already fully implemented the EHR in five medical foundations, which connects more than 2,000 physicians in the coordinated care of our patients across much of Northern CA. Our Sutter-wide EHR now encompasses information about the care of more than one million patients. We are committed to implementing the EHR at all of our acute care hospitals, however, we will not be able to install the EHR as quickly as we’d like. We do not have definitive plans for another acute care implementation in 2009 after Mills-Peninsula and we will not, at least in the near term, be issuing a definitive facility construction schedule or acute care implementation schedule. We continue to analyze all available data about the federal health information technology funding. However, the potential implications do not affect current decisions relative to the timing of our EHR roll out. Respectfully, Jon Manis, SVP, CIO, Sutter Health.

From Kiwi Pete: "Re: Kaiser. Kaiser Permanente is to be commended for making a very difficult decision in these uncertain times. I congratulate Phil Fasano for going out on a limb and facilitating this decision. Having the courage to make a strategic decision of this magnitude is the mark of a true leader. This strategic decision will ensure a strong platform for future years and solid employment and a foundation for managing costs and providing a high level of clinical care. Yes, some staff have been displaced and many will find employment with IBM. I strongly believe that healthcare providers need to begin to share facilities as one method of containing IT costs and Kaiser Permanente in their own way are making a strong statement." KP turns over data center management to IBM in a seven-year, $500 million deal that gives 700 KPers the pink slip, joining 160 others axed because of economic conditions in general. Even KP says the majority of those 700 won’t be joining IBM. KP had already made one difficult decision involving IBM that turned out to be spectacularly wrong and shockingly expensive, blowing through close to a billion dollars in having IBM develop an electronic medical record that was abandoned in favor of Epic in 2002. They made a strong statement with that deal, too, but not one that either organization cares to mention publicly.

Here are a few excerpts from Phil Fasano’s e-mail to staff about the IBM deal, courtesy of a reader: "Kaiser Permanente is announcing a strategic relationship with IBM that will enhance the technology that powers the services we provide to our members, patients, and caregivers. IBM will bring its globally recognized technology leadership to KP’s data center operations and some associated functions. As a result, about 700 people in KP’s data center operations will transition out of KP and become eligible for employment with IBM. Concurrent with the IBM announcement, we are also taking the difficult step of eliminating an additional 160 IT positions to enable us to operate as efficiently as possible during these extraordinary and challenging economic times … our strategic relationship with IBM will allow us to leap ahead in our technology capabilities and reach our goals faster than we could on our own. We also expect to see a net savings over the term of the contract which, along with today’s staff reductions, will help to support our goal of providing affordable health care for our members … While decisions that affect staff in this way are never easy, I assure you that KP is committed to providing assistance to affected employees, particularly in the current economic environment. Employees whose positions are eliminated will receive 60 days’ notice with full pay and benefits and a severance package, including continued KP health benefits. In addition, KP provides comprehensive employment, career, and personal counseling services to help employees in transition."


From Rogue: "Re: Huntzinger. Did I hear right that former CEO Rich (‘I sold it all to ACS’) Helppie came out of retirement to form a company in CA with several former SUPC employees? Is retirement really that boring for these guys, or did they lose it all in the stock market? If I made that kind of $$$, I don’t think I’d be back at the grind so quickly, no matter how much fun HIT may be." Rich is back, this time at Santa Rosa Consulting. I’m guessing it’s an amalgamation of boredom, ego, and simply doing something you know you’re good at. Maybe money, but I don’t think Rich is starving. Money or not, nobody wants to feel washed up, especially when they aren’t.

From Garrnut: "Re: WSJ article. Talks about patients educating themselves about their own health issues and  use of patient information and mentions WebMD and UpToDate." Link. I didn’t realize UpToDate comes in a consumer version (both a free one and a $495-a-year version that’s the same reference doctors use).

From Monitor 3: "Re: Emergisoft. The board forced terminations of a number of good employees including CEO Joe DeSilva, who evidently had turned the company around and improved its image during his tenure. But now it looks like they are in serious skeleton crew mode." He’s no longer listed on their executive page, but I saw no announcement. I have an inquiry in with the company.

I’m back after a little break. Thanks to Inga for capably holding down the fort. Once I’ve plowed through several hundred e-mails, I’m sure that relaxed feeling will be a distant memory.


Jack Horner, former informatics pharmacist, CIO, and interim CEO of Major Hospital (IN) since July 2008, gets the permanent president and CEO job.

Community-based health center network HealthNet of Indianapolis gets a $2.5 million private grant to implement eClinicalWorks.

A hospital in Pakistan goes live with an electronic surveillance system for pneumonia. Clinics can read a child’s RFID bracelet using a Nokia cell phone to display patient information on a secure Web site.

A hard drive containing scanned ID information on 200,000 hospital visitors is stolen from the data center at Jackson Memorial Hospital (FL). Not only was the drive stolen from the data center, it wasn’t backed up, so the hospital has no way to notify those whose information it contained. The hospital speculates the drive was stolen for personal use by persons unknown, although it’s hard to believe someone would assume that kind of risk when you can buy a huge, new hard drive for less than $100 these days. But, thieves are stupid.

I had speculated that Rob Kolodner would be replaced as ONCHIT at the pleasure of the new HHS secretary, but was corrected by several folks that his position was civil service rather than a political appointment. None of that matters, as it turns out, since he’s being replaced by academic and Obama insider David Blumenthal (I had the big scoop if I hadn’t been vacating since a well-connected reader assured me it was going to happen the day before the announcement, but I wasn’t around to run it). IT geek or not? WSJ quoted from a NEJM article he co-wrote with John Glaser: "The idea of health IT transports some enthusiasts ‘to almost a dreamlike world of health care perfection in which the work of doctors and the care of patients proceed with barely imaginable quality and efficiency,’ they wrote. But for many doctors, especially those in solo or small practices, it ‘conjures a very different image — that of a waiting room full to bursting, a crashed computer, and a frantic clinician on hold with IT support in Bangalore.’" His January article for The Commonwealth Fund called The Federal Role in Promoting Health Information Technology didn’t stray much from the party line: the government should help fund EMR purchases, encourage interoperability, and push quality via EMR use. He did take a little dig at minimally useful clinical decision support. His opinion was pretty much the same in a 2006 article.

Want to bet that HIMSS is burning the midnight oil to (a) publicly applaud Blumenthal’s selection; (b) suck up to make sure he’s not some kind of anti-vendor rogue since he’s not a HIMSS member; and (c) beg him to speak at the conference so the keynote lineup doesn’t look so irrelevant (actor Quaid, KP big shot Halvorson, blundering former Fed economist Greenspan, and an astronaut).

David Shaeffer, formerly of Eclipsys, has joined IT solutions provider GTSI.


Vitalize Consulting Solutions takes its food drive online, letting donors buy groceries (at substantial discounts to retail) for the Greater Chicago Food Depository. You can also donate at their HIMSS booth.

Forum Health (OH) files Chapter 11, citing debt load, population decline, union contracts, and the economy.

IBM is rumored to be close to acquiring Sun Microsystems for $6.5 billion.

A new iPhone 3.0 software feature: tethering to Windows laptops, meaning users won’t need air cards.

Wisconsin hospitals are hiring teams of lobbyists to help them get a piece of the stimulus pie. 

Patients in England are being monitored via Web-based instruments and are sent text message or e-mail communication when something’s amiss.


Keesler Medical Center (MS) becomes the first Air Force facility to use EMRs, having gone live in January on T-System.

Hospital layoffs: New York’s Health and Hospitals (200), Nemours (DE).

A reader asks if anyone knows about an ARRA item that will make hospital bonds more attractive to lenders. It was supposedly mentioned in a CHIME presentation. If anyone knows about it, let me know and I’ll summarize here since it sounds relevant to HIT.

Big HIMSS goodies for CHIME members willing to sit through focus group meetings (sales pitches). " … you can receive an honorarium in the form of money, an iPod touch or Amazon Kindle 2." Nice to know that objective technology decisions for non-profits start off by having vendors bribe provider executives to listen to a spiel. Say, how much do you charge to actually sign a contract?

Jobs: Epic Consultants, Pre-Sales Engineer, Ambulatory Consulting Services Director. Weekly job blasts are yours for the asking.

McKesson Medication Management and a neurosurgeon are hit with a $38 million lawsuit award for a herniated disk repair that left a patient bedridden. The surgeon injected dye that was not appropriate for the type of surgery he was performing, with McKesson joining him on the expensive hook because its pharmacy people supposedly discarded the drug’s packaging before sending it over. The doctor had been sued nine times previously and hit with a state fine for bad medical practice. The surgeon carried no malpractice insurance and avoided a previous lawsuit’s judgment by declaring bankruptcy. McKesson says it will appeal its $5 million part of the payment. Given the award, however, it’s no wonder that you could easily die in a Florida ED because no neurosurgeons are willing to take your trauma case.

We’ve talked a lot about the heparin error involving the Quaid twins, but a reader sent over the California HHS’s report on the Cedars-Sinai incident. The findings: the twins were given heparin 10,000 units/ml as a line flush instead of the hospital’s approved 10 units/ml after pharmacy techs stocked 100 vials of the stronger product in the drug dispensing cabinet. Of those, 14 vials were believed to have been administered to three patients, so reversal drug protamine sulfate was given to two of those patients (the twins). The floor stock heparin had not been double checked despite being considered a high-alert, high-risk med; it was also missing the green labels reminding staff that it required a second check as hospital policy required. One pharmacy tech said he was not aware of the policy. Nurses could not recall what they administered, one said she couldn’t recall if she read the label first, and some doses were given without documenting on the MAR. Early reports said the heparin was prepared wrong in the pharmacy (that would be odd) and therefore I concluded that bedside barcode checking wouldn’t have mattered since the label would be correct but its contents wrong. In this case, the heparin was pulled from the drug dispensing cabinet (as it is 99% of the time) and barcoding would have caught the error. Pyxis machines are candy stores full of potential errors unless hospitals are extremely vigilant in how they’re stocked and monitored, of course, offering Cardinal an opportunity to sell the add-on that barcode checks the stocking function (surely Cedars has bought it by now).

Carilion Clinic (VA) loses a big chunk of its assets due to investment losses, is struggling to keep doctors, and says its Epic EMR system is the "single biggest factor" in its $20 million loss in FY08 (although that expense was planned).

CEOs, performers, and pro athletes seem to be escaping any damage from the recession, so this is no surprise: Oracle’s Larry Ellison, already worth $50 billion and making $85 million a year in salary, will add $230 million a year in much-needed income now that Oracle has approved a dividend.

A promotional documentary being filmed features the VA TeleHealth Clinic of Craig, CO.

The Social Security Administration goes live with the first piece of NHIN, using electronic records to process disability claims via the open source NHIN Connect Gateway from Harris Corporation.

Investigation of a UK hospital’s high death rate finds that receptionists were triaging patients, meds weren’t being given, and patients were left so long without food or water that they were drinking out of flower vases.

HIMSS says (again) that registrations are on track compared to last year, but a reader noticed that only 12 hotels out of 64 are showing as full on the housing site. Maybe that’s par, but it sounds low.

CCHIT will hold a HIMSS conference town hall session on certification of open source EMRs. It’s Monday, April 6 at 2:00, but CCHIT will provide remote access as well. For all those conspiracy theorists who think HIMSS and CCHIT are the puppets of proprietary EMR vendors, watch this session carefully. My prediction: the conclusion will be that anyone is welcome to have their EMR certified as long as the tests are passed and the money paid (which is true today). And to be honest, what else could they say? If you believe that CCHIT certification is vital to ensure interoperability and reduced risk for purchasers (plenty of folks don’t, but that’s another story), then they really have nothing to offer except to waive or reduce the certification fee for organizations that receive no income from licenses.

E-mail me.

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Currently there are "8 comments" on this Article:

  1. Emergisoft:
    So what now? No new sales in 2008, terminations….should existing clients be looking for relief??

  2. Sutter freeze doesn’t sound right to me. Why freeze a project that Obama says he (we!) will pay for? Even if you don’t have the capital now with the gvt saying they will pay tens of millions to a place as big as Sutter if you really believed in the ROI you’d get it done sooner. And a bank would be happy to finance it.
    So what’s the rest of the story??

  3. Thank you for the information re: Sutter and Kaiser. I am glad now that I recently moved away from California leaving my Kaiser job behind, moving to Texas, the land of many successful Epic implementations 🙂

  4. Rob Kolodner is civil service, but the position of National Coordinator is not. An exception was made to confirm him in the post which has always been intended to be political. There are rules against permanently converting political appointments to civil service jobs. The outgoing administration usually does this for a few people anyway, but they did not do it for Kolodner, whose political affiliation lies elsewhere.

  5. Ever wonder why these outsourcing announcements all sound alike? ” . . . our strategic relationship with X will allow us to leap ahead in our technology capabilities and reach our goals faster than we could on our own. We also expect to see a net savings over the term of the contract . . . “? In the vast majority of cases, these contracts end before the initial term. Why? It turns out that you can’t “leap ahead” without paying for it (also called “change orders”), and you can always predict a “net savings” if you project your own costs high enough. Fundamentally the outsourcee wants to have the best technology at the lowest cost; the outsourcer wants to make money, which it can only do by providing less of a service that is hard to measure in any case. Returns to scale in computing are certainly possible, but outsourcing has yet to demonstrate that this can be done while continuing to meet customer expectations and requirements.

  6. Emergisoft did have both new sales and client upgrades/expansions in ’08…but I think ’09 looks pretty bleak…yes, I’d be concerned as a customer.

  7. Heard on Twitter: “Who says elephants can’t dance in hospitals? Well, given the past track record of said elephants in the data centers of said hospitals…”

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