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Time Capsule: US Hospitals Can Learn a Lot From Richard Granger’s Approach

August 12, 2011 Time Capsule No Comments

I wrote weekly editorials for a boutique industry newsletter for several years, anxious for both audience and income. I learned a lot about coming up with ideas for the weekly grind, trying to be simultaneously opinionated and entertaining in a few hundred words, and not sleeping much because I was working all the time. They’re fun to read as a look back at what was important then (and often still important now).

I wrote this piece in June 2006.

U.S. Hospitals Can Learn a Lot From Richard Granger’s Approach
By Mr. HIStalk

The British government’s audit report of its Connecting for Health project, released a few days ago, confirms the obvious. Richard Granger and company have put together a remarkable program for aggressively managing their software vendors.

Granger was tough from the beginning. He threatened, for example, to write his own PACS if high vendor pricing made that an attractive option. Complex contracting was wrapped up in less than a year. Vendors had to prove their ability to deliver through real-life simulations. Most importantly, contracts clearly state that no one gets paid until their stuff is working. All of this, unfortunately, is highly innovative in the back-scratching world of public sector IT.

The Achilles heel of Connecting for Health’s vendors has been the contractor-subcontractor relationship. Big consulting companies won the business, then promptly subbed out to application vendors. That was covered in the contracts, too: the bidder is liable if its subcontractors under-perform, which they largely have. Smart contracting protected the National Health Service against the failings of iSoft and IDX, hitting the consulting companies who chose them squarely in the wallet. That’s how it ought to work.

Granger holds firm and goes public when he has to, unafraid to rip recalcitrant vendors by name. I like to picture him as a Gordon Ramsay-type scrapper, happy to take someone down a notch when they need it.

Providers in the US can learn a lot from the auditor’s report. Vendors throw the ‘partnership’ buzzword around a lot to impress rubes, but it’s usually a marketing term instead of a true risk-sharing contract like Granger demands. Hospitals usually just moan about poor vendors instead of using their intelligently crafted contract to withhold payment or send them packing. The auditors lauded NHS for protecting the taxpayers’ money through smart IT management, and rightly so.

I compare it to road work, which most states do poorly. How many times do you drive by miles of orange barrels with no workers in sight, unless they’re standing around aimlessly, and even then only on weekdays from 8:00 until 4:00 when they’re not on break? Traffic is snarled around the clock for months as grass grows from piles of unmoved dirt amidst infrequent activity consisting mostly of sociable shovel-leaning. That’s how hospital IT projects and vendors sometimes work.

On the other hand, I lived in a state that ran roadwork like a private business. Contractors were given incentives to finish projects early while meeting quality standards, which unsurprisingly, they almost always did. Work could be done only at night, worker inconvenience notwithstanding. The difference to motorists was striking, the state saved money, and incompetent contractors were driven out. The only mystery is why other states aren’t smart enough to copy their success instead of having single-lane rush hour traffic cursing at orange barrels.

I admire Richard Granger. What’s wrong with being tough when so much public expectation and money is at stake? Hospital IT departments may be smaller, but they can learn a lot from Connecting for Health’s experience in managing their vendors and their projects. Of all the blowhards on the health care IT speaking circuit, he’s one of few who I’d look forward to hearing.



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