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HIStalk Interviews Eric Rosow, Chairman and CEO of Premise

November 26, 2007 Interviews No Comments

Eric Rosow
Photo: Hartford Courant

I was certain I knew Eric Rosow of Premise when he introduced himself as a new HIStalk sponsor, but I couldn’t place him. Finally, I remembered: I had seen his presentation at the 2002 HIMSS conference in Atlanta called “Real-time Executive Dashboards and Virtual Instrumentation: Solutions for Healthcare Systems”. It was one of a handful that I thought were interesting enough to cull out for further review, the idea that a feed of information and instrument sources could, like a car’s dashboard, provide an array of information needed to keep the vehicle operating efficiently and going in the right direction.

Patient throughput and its underlying components (patient assignment, bed managment, housekeeping, and patient transportation) have an enormous impact on hospitals that I’ve seen first-hand: ED waits, patient satisfaction, staff satisfaction, and even clinical outcomes (another great HIMSS presentation from years ago was from CareScience, which dealt with bed assignment and the clinical variation that occurs when nursing units get patients whose needs are vastly different from the average patient on that unit).

Hospitals need the kind of measurement and transparency that products like Premise’s can provide. Many (most?) of them have the expensive symptoms of poorly managed patient throughput. No wonder Premise has enjoyed growth of over 2,000% in five years.

Tell me about yourself and about Premise.

First, I have to say that I feel like I’m talking to an underground celebrity. I really love your blog. It’s just so refreshing and humorous and insightful and thought-provoking. It looks like at the rate you’re growing, it could blossom into a great vehicle for communication.

I’m a geek by definition, in some respects. I’m an engineer by training. I went to Trinity College here in Hartford, Connecticut. I majored in mechanical engineering and then got my Masters in biomedical engineering.

My Masters program had an internship, so not only did I get my degree in biomedical engineering, I also spent two full years at St. Francis Hospital and Medical Center in Hartford. That’s really where I fell in love with applied technology in healthcare. After graduating, I got to row with the US team for a couple of years, which was a great experience to see other parts of the world. I then went back to Trinity and taught for a year. It’s very true that you have to learn something to teach it.

After that, I joined Hartford Hospital as clinical engineer, where I was immersed in front lines of healthcare delivery and the role that technology can play in addressing those challenges. I did a 13-year stint at Hartford Hospital and was the director of biomedical engineering for the last seven. I served on the capital committee and was involved with the technology assessment of major projects, including enterprise-wide monitoring and re-engineering engagements.

It was the reengineering initiatives in late 1990s that led to the opportunity to develop what we now call our bed management platform. Hartford Hospital was faced with a number of challenges. A top initiative there was to find, build, or buy enabling technologies to help streamline capacity management/bed management. They had looked at different solutions on the market, but felt there was need for better communication and better integration of clinical information. That provided the opportunity to co-develop the Bed Management Dashboard.

I love the sport of rowing and helped started a rowing team in our town. Through that experience, I learned to value the passion, the teamwork, and the commitment that can come with a high-performing team. I think that experience fostered the entrepreneurial DNA that must have been in me. Or, the lack of a fear gene – I’m not really sure which [laughs] that resulted in us creating this crazy thing called Premise.

Premise is an interesting ride. It wasn’t just, “Let’s go off and create this thing called Premise.” It started out as two guys in the basement, myself and a long-time friend and colleague named Joe Adam. We met as high school lab partners. We were the yin and yang of complementary skill sets. In the early days, we were more of a consulting firm. Over time, we evolved to apply our applications to product-focused and decision support and business intelligence, ultimately to workflow applications. That was the next generation of Premise, in the late 90s, where we evolved from consulting and data acquisition and data presentation and focused on how we could apply those tools and visualization dashboard metaphors to really impact healthcare. For me as a biomedical engineer, it was such as great intersection of connecting devices and communications with workflow and safety and efficiency initiatives.

Hospitals used management engineers a lot a few years back to find and fix process problems. Did that work and are they using them enough today?

One of the ways I got engaged in developing the bed management dashboard was that I was one of first non-GE employees to go through GE’s Six Sixma quality training. Whether it’s management engineer or TQM or CQI or Six Sigma, I think the goal of trying to make informed decisions based on data and trends is what will always be required in healthcare, particularly given the challenges of aging nurses and baby boomers, the perfect storm that’s happening with capacity demand.

Hospitals respect the science of management engineering in day-to-day operations, but saying and doing it are two different things. In our focus area of capacity management, there’s a huge opportunity where information technology can play a huge role in improving that. Specifically, in things that IT is really good at – providing transparency across the organization, analyzing variation, looking at historical trends like where are peak discharges and admissions by time of day, day of week, time of year – and most importantly, streamlining communication among stakeholders.

MRSA is an example of where, when we developed our application, it was really important from the get-go to provide that type of clinical information so that caregivers could take the precautions they needed to and not put patients at risk, particularly if they’re in a semi-private room.

How big a problem is patient throughput in hospitals?

It’s amazing to me how ubiqitious it is, not only in large hospitals, but small hospitals, and not only here in the US, but internationally. We’ve been fortunate to work with a lot of great thought-leading hospitals, places like Cleveland Clinic, Mass General, MD Anderson, and even recently at a kickoff for our first international application at Singapore General Hospital. Places like that who have lived through the SARS epidemic have an even greater appreciation for the challenges when it comes to emergency management. The day-to-day issues include ED wait times, the metrics around diversion, people who leave without treatment, satisfaction indicators, not only people coming from what we call portals of entry, like ED and ancillary areas, but are transfers from other hospitals.

The challenge I’ve seen is that ED backups or diversions and OR and PACU backups are symptoms of a much broader patient flow challenge. Studies have been done that show that ED wait time isn’t necessarily tied to volume or ED staffing, but the visibility of upstream bed capacity. That’s the challenge in hospitals from 100 to 1600 bed hospitals throughout the world. The opportunity to create virtual capacity by better utilization of existing beds is important, especially when we’re seeing bricks and mortar and cranes helping to build out capacity, but at a cost of half a million to a million dollars per bed, plus several years to do that. That’s the real benefit.

It’s looking at the right metrics. The bed turns in a year or in a given time period is a key operating metric that all hospitals need to monitor in real time to better manage their operation.

What are the symptoms that your hospital has a throughput problem and do executives recognize them?

Certainly diversion, excessive wait times in ED, people who leave without treatment, operating room cancellations or delays or backups in PACU. Corresponding derivative effects of that are upset physicians, caregivers, and surgeons who have to cancel or delay their cases due to lack of ICU or stepdown beds for patients to go to after the surgery. Also the challenge of what we call the shell game, where patients are placed on off-service units. An orthopedic patient who’s had their hip done that morning may go to a medical floor. That creates a whole host of challenges. Those units are not trained to manage an orthopedic patient and they are often placed in a temporary holding state. Medications and meals may play catch-up as the patient moves from one holding area to another. You create work for the organization because you’ve got a bed that was occupied that has to be cleaned and prepared for another patient to come in.

There’s great efficiency if you can get them to that right level of care the first time. We’ve seen hospitals that have done more than 40 intra-unit transfers per day. You’re just not getting the throughput you need because of poor visibility across the enterprise. In our experience, capacity management in many hospitals is reactive and decisions made round a diversion, cancellations, and delays are made without good, real-time information that can support these decisions. That’s the biggest value that Premise is focusing on – increasing that visibility and decision support.

Can throughput problems be fixed without an actively managed patient transportation program?

Clearly it’s a continuum. I’ll go on record as saying that you can’t fix throughput with any technology solution. It’s a holistic approach looking at as-is, the to-be state, gap analysis to configure a solution to manage that continuum. The way we look at it is that you’ve got a circle – a portal of entry, bed assignment, bed management. Then, you need the transportation on site to move the patient and/or assets and other equipment to their room and level of care. Communicating all the activities throughout the length of stay to discharge, when a housekeeping event occurs and the room and bed are cleaned. We were originally focused on clinically driven bed management and evolved to environmental service functionality. Our newest module, Transportation Dashboard, provides that visibility across the transportation team as well.

Are hospitals getting better at discharge planning?

I think they’ve had to. As more information becomes available, it becomes easier to plan. The challenge we’ve seen is this notion of hiding beds. People can only make decisions only based on timeliness and accuracy of the data they have. Patients may leave the hospital at 10 in the morning, but that event may not be broadly visible across the organization. If you’re looking only at one ADT system, it could appear that that patient is still up there occupying that bed. That’s the type of mis-information that can create a cascading effect of backups. That continues to be a challenge in terms of visibility in discharge planning and overall patient flow.

Hospitals often think that bed turnover is a housekeeping issue. Is it?

No, I absolutely don’t think so. I often think one of the most rewarding aspects of our solution and the clients we’ve worked with is vindicating and supporting what a great job the housekeeping departments actually do. Because housekeeping departments may not have all the tools and data to support the job they do, they can be the easiest to blame. By providing metrics such as response time to a cleaning request and bed turnaround time, and doing that both on a shift and employee basis, Premise can really empower an organization to see where the bottlenecks can be in their patient flow process. In general, they’re not with housekeeping.

Can census levels be predicted?

I think hospitals can predict some of them. Certainly if you’ve got scheduled procedures, you can see what’s coming up. You can look at histograms and historical trends and control charts of what patterns have been historically for different regions of the country. There is a growing capability with some of the business analytic tools to look at what patterns have been and to use that going forward.

Having been at Hartford Hospital on 9/11, a tragic day for this whole world, the ability to look at patients that were in the hospital that day … there were only three open beds that morning and calls were coming down from state and federal authorities. There were two questions: how many beds do you have available right now by type and how many can you have available in one, two, and three hours from now? Without technology to augment your hypothesis, it would be almost impossible for many hospitals to answer that question. Hartford was able to free up over 140 beds that day to make room for anticipated casualties from New York City, which tragically never came.

What’s the ROI on your products?

There are different pain points for different organizations. Many we’ve worked with have looked purely at their ability to increase admissions without increasing their bed compliment or increasing their staff. Going back to virtual capacity and making better use of the beds they have. Other ROI elements can tie in to reduction in diversion, reduction in OR delays and cancellations. We’ve developed quantitative and qualitative ROI metrics that may or may not apply to a particular hospital’s geography or challenges.

We’re seeing more and more organizations view patient flow as a strategy, not just a problem. It’s critical, it’s real time, it’s strategic. The ability to increase efficiency and therefore profitability is why inpatients are such a high profile. It also plays an important role in patient and staff satisfaction. Chief nursing officers and other leaders use tools that help manage beds and and patient flow as a recruiting tool that makes it a more desirable place to work. All the years I’ve worked with nurses and physicians, they want to do the best job possible and take care of patients like they’ve been trained to. When you have such a potentially out of control system with patients not appropriate for their population, that can create anxiety and risk. Getting the patient in the right bed the first time is critical.

What vendors are competitors to Premise and how would you compare your offerings to theirs?

Certainly the market continues to mature. The vendors we typically see are Tele-Tracking, who I have a lot of respect for; Navicare; Statcom as a pure play vendor as well; and certainly Awarix is a really impressive company and obviously McKesson thought so as well. Those are the pure play vendors we see most often. The large healthcare IT vendors have some functionally. We see ourselves as complimentary to them. We can work in concert with the big HIT or ADT vendors out there. It’s good for the market that we’re all raising the bar, all bringing features and functions to bear as strategy that allows hospitals to better utilize their beds.

In terms of differences, our architecture is open, flexible, based on industry standards. We’re a Microsoft technology platform. We’re unique in the clinical functionality we use to match the patient’s clinical attributes to their level of care. If a patient presents with chest pain and tuberculosis and MRSA, we might need to find a bed with a patient monitor and negative pressure capability in that room. We used to joke that if you have a Yankee fan and Red Sox fan, you may not want to put them in the same semi-private room during the playoffs.

There’s all kind of attributes that may not be readily apparent. Some hospitals have to track gang affiliations. You don’t want to put rival gang members in semi-private room. This ability to complement ADT demographic data with specific attributes, like monitoring infectious disease, is really important to optimize the patient flow experience.

We want to have a highly intuitive look and feel and an easy-to-use user experience. We have patent pending technology called our Intelligent Workflow Engine to optimize and load level how tasks are assigned, particularly in the area of bed turnover, environmental service/housekeeping, and transportation tasks.

I do think it’s not just about technology. You don’t just double click the install button and it’s done. We measure the as-is state and the to-be state based on desired outcomes, and then gap analysis. We bring subject matter experts, a number of clinicians who are nurses with backgrounds in clinical patient flow, project managers, and technical specialists to make sure that when we go live with client, we tune that application to align with their desired workflow. For that reason, our solution may not be right for everybody, but for those it is, it will fit like a glove when we’re done.

Deloitte recognized Premise for outstanding growth of nearly 2300% over five years, one notch behind Google. How did you create that growth and how do you manage it?

We’ve certainly been excited to have grown the way we have. We joke internally that we were right behind Google in terms of statistics, so we love that “lies, damned lies, and statistics.” [laughs] We have great people who have a lot of experience in building companies and also focusing on what’s important. Our goal isn’t to grow, it’s to have 100% referencability. People here are exceptionally passionate. We say we have a company, but we have a mission to make a meaningful difference in healthcare. Hiring the right leaders, the right skill sets and, most importantly, the right culture and chemistry is key to any high performing organization.

In some cases, we’ve been better served by hiring people from outside of our industry. We recently created a chief technology officer position and, after an extensive search, hired a person from the digital media space, somebody familiar with innovation, user experience, and time to market, unencumbered by the traditional healthcare IT world. That has been an advantage for us to innovate. We also made a decision, for the first time, to take on a round of investor money. Through that process, we’ve got a very strong board of directors and thought leaders who have been wonderful advisors and strategists and also mentors to me and other members of our team. One gentleman in particular, Joe Zaccagnino, was the former CEO of Yale New Haven Health. He brings a tremendous insight into the challenges going forward in hospital management and administration.

You said when you hired Craig Gavina as CTO that innovative consumer technologies have healthcare potential. What are some of them?

Certainly as we look at different forms by which information can be displayed. Form has to fit function. We don’t want to be too ahead of curve, but we want to be responsive to what’s out there. One thing we say here at Premise is NEHITO – nothing every happens in the office. We want to make sure we understand what is the most effective way to deliver information, through touch screen interfaces to PDAs to iPhones, as well as traditional vehicles.

The other thing that’s exciting to me as a biomedical engineer is the convergence of other medical devices and applications with patient flow. We have relationship with Stryker,where their next generation smart bed, or iBed as they’re calling it, can communicate bed parameters. For example, are the side rails up, are the brakes on, is the bed at a low height. That information can be critical to another hospital challenge, falls and fall risk and the ability to integrate that type of information into an application like our patient flow system. The same applies to scheduling and resource management. We have a history of form fitting function.

We do what’s right for the customer, and by having a lot of what I call Chuck Yeager accounts – hospitals that push the envelope of this company in a good way to make sure we’re thinking ahead but also grounding our thinking in what will work and what won’t. I know from my experience at Hartford Hospital that things that don’t work the first time often don’t get a second chance. Applications that are innovative and functional and, at the end of the day, will get used.

I love to read books and ideas from thought leaders. One of my favorite authors is Guy Kawasaki, who describes himself as Apple Computer’s evangineer, someone who wants to change the world and has the technical ability to do it. That’s what I see that at Premise. We’re excited to have this technical ability to influence how patients move through organization. We’ve had housekeepers come up to use with tears in their eyes and hugging us, thanking us for being able to show what a great job they do in helping that organization improve their patient flow.

Where does the company go next?

We see a tremendous challenge of continuing to focus and build on the base we have. The opportunity we have to extend into the ability to tie into other devices, staff scheduling, analytics – the market will see a lot more functionality on reporting and analytics. We will continue to be opportunistic as we see challenges and synergies that are presented. We don’t want to boil the ocean – we want to focus on what we do really well. We see the benefits and value of RFID technology.

At Singapore General, we’ll see the integration of advanced RFID technology into our patient flow platform. Technology that can not only show the location of a patient, of staff, or an asset, but also be able to measure physiological signals of those patients, like core body temperature. In Singapore, that can be a useful tool to for precursors or outbreaks of infection or disease states like SARS or avian flu.

Who do you admire in the industry?

I think people like Michael McNeal, who I know you interviewed a while ago. What he’s doing with Emergin is really exciting, how he’s looking holistically across multiple vendors and providing that glue, middleware that can tie information and devices together to enable companies like Premise to add value quicker. Outside the industry, I really admire Steve Jobs and the elegance of what Apple has done and continues to do. I’m one of the heretics here at Premise that carries the iPhone and MacBook running Windows applications. I hold that as the standard to try for in terms of elegance, ease of use, and functionality.

Also, Bill and Melinda Gates and the incredible work their foundation is doing for global health with access to vaccines and drugs and research to develop health solutions that are affordable and practical. I’ve been an Apple evangelist since college, but I’ve always admired Bill’s ability to scale his vision and organization through the vehicle of Microsoft and especially the standards and rigor of the Gates Foundation. It has always been my goal to create social value through my profession and now through Premise. I’ve been in the healthcare profession my entire career because I can think of no better industry to devote one’s time and energy to. Their leadership by example has been a tremendous catalyst for others to contribute, like Warren Buffett, to such an important initiative — global health and the challenging inequities in the world.

Any other thoughts?

The patient flow is a strategy and looking at logistics and analytics is a platform to look at the core processes of delivery. That’s what we’re really focused on doing.

Our success to date has been a combination of our company’s humility. We don’t think we know it all, but we have have great advisors and customers to guide us through a dynamic market. I think it’s due to our passion, a desire to innovate, and our commitment to realizing that vision that has made this place, while at times challenging given the growth we’ve experienced, rewarding. Everybody who works here wakes up every morning excited about what we’re contributing to healthcare. It’s not for everyone, I wouldn’t want anything else. I’m really proud of this team. I don’t want to sound like an infomercial, but I really mean that. It’s a great experience we’re building on and I really appreciate the opportunity to talk with you and I appreciate all the great work you’re doing with your website.

A doctor I worked once with made a great analogy. Why do people buy drills? What they’re really buying is holes. I love that analogy. What is it you really do? What we really do is provide workflow automation, but what we really provide are analytics and real-time information. That’s what people need. We are never going to be a replacement, nor do we want to be, for the big HIT vendors. What we want to be is a decision support tool and real-time dashboard that can work in concert with ancillary systems to make the best, accurate, timely decisions so that the patient gets to the right place at the right time. That ties into patient safety and a whole host of other benefits.


HIStalk Interviews Tanya Townsend, Director of IT at Saint Clare’s Hospital

November 14, 2007 Interviews 2 Comments

Tanya Townsend

Every CIO’s dream is to start fresh with a new hospital in a new market with all-new employees, choosing technologies from scratch and building the necessary infrastructure right into the structure. Tanya Townsend had that opportunity. The level of automation in most small hospitals is modest, but Saint Clare’s Hospital in the Village of Weston, Wisconsin, is a 107-bed digital hospital, thanks to some cooperation with Marshfield Clinic and parent organization Ministry Health Care.

The all-digital characterization generates a lot of industry interest, so thanks to Tanya for sharing the story with HIStalk’s readers.


Tell me about yourself and your job.

I am IT director for Saint Clare’s Hospital in Weston, Wisconsin. I’ve been here three years now, so I was involved with project about a year before it opened. We are the first and only all-digital hospital in state of Wisconsin, a very remarkable and unique experience and I’ve been part of that since the beginning.

If I walked the halls of Saint Clare’s, what would I see that’s different form the average hospital?

First and foremost, it would be lack of paper chart and a lot of paper-pushing of the paper chart. So, for example, on our nursing units, based on our design for an all-digital hospital and knowing we didn’t have to worry about having a central communications station where that paper chart is generally stored. We started to rethink how we were going to provide care and do business with this new model in mind.

We actually decentralized nursing unit and put all of our nursing staff closer to patient. Now we have alcoves outside all of the patient rooms where documentation can occur, otherwise our document is completely mobile and wireless. Documentation can occur at the bedside as well.

We also implemented voice over IP wireless phones so all our communication can happen either via the computer or phones, tied into our nurse call system. Everything is very mobile and everything is real-time action. It’s a different model for communication and lot more of a decentralized approach, closer to the patient and then hopefully more family-friendly as well.

How do you define an all-digital hospital?

That’s a great question because I’m finding out, as we start sharing stories with other so-called digital organizations, we all have a little different definition of what exactly all-digital means. Going into our guiding principles, we certainly had a lot of different ideas of what we wanted the all-digital approach to be. One was that we didn’t want a paper chart and to worry about storing or maintaining a paper chart in a long-term format. That was the first piece – understanding how you’re going to get rid of any paper coming into your facility in the first place.

It’s also about optimizing information flows across the continuum and building in decision support and patient safety into all of the different systems as much as possible. That means implementing systems such as CPOE and clinical documentation with decision support at the bedside. Not neccessarily just about scanning paper on the back end.

One of the biggest problems CIOs have is change management. What opportunities did you have starting from scratch?

That was actually a unique opportunity. We were a brand new facility – we weren’t even a replacement facility, in a new market and a new area. Everybody coming into the facility was brand new. We all came in with open eyes, the sky was the limit, with a sense of camaraderie and collaboration from the very beginning, both business as well as IT, starting with the senior leadership level. The senior leaders built this vision, and upon hiring everybody into the hospital, everybody was part of that same vision. Very open minded, a lot less of “we’ve always done it that way.” We set expectations right at the beginning, even with the recruitment process.

Other pieces are building the culture of what we wanted to accomplish, so this idea of decision support, best practices, patient safety – it was at the core of every one of our processes that we built. It was also part of the initial process before the hospital opened – building our culture and process flows. We formed multidisciplinary teams for year before hospital opened, forming process flows. It could be as simple as registering a patient or as complex as medication reconciliation. We have 8,400 pages of process maps, all available digitally and used for both training purposes and process improvement purposes..

It really is an evolution. They’re not just one-time static documents. Any time we want to improve a process, we go back to the process maps and they get continuously updated.

How did you create the process maps?

We have a project manager. We use a project management methodology and we had a project manager to help facilitate those sessions. We had simulations and walkthroughs, and since then have a process improvement manager who will update the process flows and facilitate the sessions sessions. Our quality department is absolutely integral as well. They usually identify the areas we want to look at for process improvement activities. They’re available on our Intranet and we built them with Visio.

What systems do you use and why did you choose them?

Where we had the opportunity to really start fresh, we also knew from a cost savings opportunity as well as efficiency, and what we needed on this campus was a lot of collaboration, with both Ministry Healthcare and Marshfield Clinic present on this campus. Rather than reinventing the wheel, we took a look at what was available to us within both organizations that we thought we could fit in here. We looked at the tools that then did a gap analysis of where the holes were that we needed to identify solutions for.

We came up with two core systems. One of the was GE LastWord, now called Centricity Enterprise, and we’re in the process of converting to that. The other is the Marshfield Clinic application, which is now called Cattails MD. They officially got their CCHIT certification. 90% of all our documentation for our medical record is found in those two core tools.

The OR and ED are two very niche areas that typically require their own set of documentation. In the OR, we are partnered with Picis. They do our OR and anesthesia documentation for pre-op and intra-op. In the ED, we recently went live with MedHost for ED documentation. We also have the GE perinatal product, formerly known as QS, in family birth center. The other gaps was progress notes. How were we going to handle hospital progress notes? We had hunch that we were probably not going to get physicians to type their progress notes. It was one thing to ask them to do CPOE, but we weren’t sure we were going to get them to type progress notes.

Also, the different types of paper forms that are typically found in a medical record  chart that we don’t have solutions for – anatomical drawings, for example. There’s some forms that get approved through the medical records committee every month. And, documents coming in from outside facilities. We knew that patients would be coming here and transferring their care who might have some paper coming with them. We needed to find a way to acquire that into the record. We partnered into Marshfield Clinic. Since they do their own development, we could partner with them and decide on solutions for that.

With Marshfield Clinic, they developed a system called Digital Ink over Forms. That’s a tool that allows you to use a tablet style PC, pull up a form, and complete it with a stylus on the tablet. It digitizes your handwriting or whatever you did on the tablet. That’s our solution for progress notes as well as those different types of forms like the anatomical drawings. We have a scanning solution also developed by Marshfield Clinic for scanning those paper documents that will make their way into the facility.

How does the Marshfield Clinic’s homegrown EMR application work?

It’s actually been in development for the last 20 years or so. It was a system developed by physicians, for physicians. Marshfield Clinic is physician-run group. A lot of it was just a unique opportunity for us to say, “These are the gaps are on the hospital side, can we partner together to help with that collaboration across the continuum”, which is where you often have handoff issues, between ambulatory and hospital and back. That’s where a lot of handoff errors can occur. How can we partner together so that our systems are integrated across the platforms? So they’ve done a lot of very remarkable things, a very powerful tool.

We use it differently in the hospital than they do on the ambulatory side, but we share a problem list, medication list, and allergies. That was a key requirement for patient safety, that we have a medication list that would cross the continuum between ambulatory and hospital and back. The developed a very powerful medication reconciliation processes called Medication Manager. That’s also for patient prescription-writing as well.

Like I mentioned, the scanning solution is embedded right within their system. We have all our radiology and PACS images integrated with their system that allows dictation. And, one of the most unique functions is the Digital Ink over Forms that allows you, with your tablet and stylus, complete forms digitally or electronically. I’m probably missing a bunch of things it does. One of the reasons that Cattails is certified is that because it certainly meets all the standard criteria that commercial vendors already have as well.

What kind of user devices are in place?

Our core tool is the Fujitsu tablet, primarily because of that Digital Ink over Form documentation opportunity where we can use it with the stylus pen and complete the forms digitally. It’s mobile and wireless, of course. That’s our core clinical device. Each provider gets a tablet, whether a nurse or physician. The physician typically gets their own assigned to them and can take that from the clinic to the hospital and can roam freely throughout the campus using their personal tablet. On the nursing units, we have a pool of devices that they check out for the day and that’s their clinical tool they use throughout their shift.

How’s the battery life?

We have docking stations outside all those patient alcoves that I mentioned, so there’s lots of opportunity to sit and charge up. We also have the COWs that they can charge up on. If you’re operating wirelessly, continuously, it’s probably about four hours.

What kind of IT infrastructure was created for the hospital?

We’re completely Cisco, using the voice over IP technology as well of all of our wireless mobility. We’re using the tablets on wireleess, phones on wireless, wireless IV pump … lots of devices sitting on our wireless infrastructure. One of the concerns that I often get asked is about downtime and how to avoid any systems from going down, it both wireless as well as wired. We have multiple categories of redundancy, both on the wireless side as well as wired. Redundancy with different paths going to our data center so that if one of those ties is severed, the other would be up, entirely seamlessly. That’s another goal of the all-digital strategy, to make sure you have 99.9% uptime.

Is your data center on campus?

Actually, no. We have several data centers to house all of these different systems. They’re in Marshfield, Wisconsin, which is about 45 minutes away from Weston. We have a local data center as well, but our core main servers for both the Marshfield Clinic application and GE are in Marshfield.

So you’re running their systems and don’t have to run a separate instance?

Correct, which goes back to that we looked at the tool already available to us that made sense to us to adopt.

What about your wireless infrastructure?

We run 802.11g. We are running into the issues of the A-B-G compatibility with different devices that were available at the time. For example, our wireless phones operate only at the B level, so we have a little bit of issues with the access points being drained with too many devices on the access point, all at the same frequency at the same time. We’re upgrading our wireless infrastructure to separate out that traffic, which is again where it came in handy to have several areas of redundancy for an access point.

Do the B-devices slow everyone down to B-speed when they connect?

It drops the whole thing and we’re living that. Because the phones are almost always connecting to an access point, they limit the number of connections to each access point to try to streamline some of that traffic. The hospital opened and we learned that lesson.

What lessons learned would you have for IT departments moving into a new facility?

A lot of it was on the wireless side, to do the appropriate site assessments. That’s the trickiest thing, to put as much traffic on the network as you think you’re going to have to try to get those correct assessments. That was the tricky piece, especially trying to do that before the furniture was placed. Once you occupy the building, there’s all sort of findings with the wireless piece. So that’s a lesson learned – once everything is occupied, you probably want to do a few more assessments.

We had all kinds of interesting things happen. TVs, for example. We almost didn’t have TVs on our opening day because it was the same time as Hurricane Katrina and they were stuck out in the ocean somewhere. You never know what you’ll have to plan for.

In terms of disaster recovery, as much as you plan for avoiding an outage in the first place, you still have to be prepared because the inevitable will happen and did. Three months after opening, we had one of those unexpected WAN outages and we were essentially an island over here. The good news is that we had a good backup downtime electronic medical record system that we could access in that event, but not everybody was as familiar yet. It was one of those things that you have a procedure for, but you don’t necessarily walk through as often as you need to. That was another lesson learned.

How does the downtime EMR work?

We have a lot of our information stored in there. Even our niche systems like Picis in the OR and perinatal QS in the family birthing center and MedHost in the ED, all of those systems feed a summary document or quite a lot of patient information to the Marshfield Clinic Cattails system. That’s essentially our core repository. That information is then replicated, both in their data center as well as another offsite data center located in Madison, Wisconsin. That’s replicated near real time. So, we have the ability to access that through the Web in the event of an outage. Even if Cattails is down, we can still get to it.

Or, if the WAN is down, we have a satellite on the roof directly connected to this location in Madison so that we can pull up all of our patient information over the Web. It is just view-only at that point, so our downtime procedure is that you’re viewing information, but any new information that’s being captured, you go to a downtime process of paper. Imagine that. We do have paper. [laughs] That’s part of the downtime procedure process – identifying what are those core paper forms that you need to keep on standby.

IT in 107-bed hospitals is usually unsophisticated because of financial constraints. Can comparably sized hospitals accomplish what Saint Clare’s did?

That actually was part of the analysis. We did say, “Let’s try to leverage what we have available to us”, but we did a feasibility study and other vendors were looked at. For some of these systems, the vendor wasn’t too interested in us and we couldn’t touch the ballpark figures. That’s where it really made sense to leverage what was available to us. From a cost savings perspective, that was phenomenal.

What’s your IT staffing?

I have 21 FTEs on my payroll, but there’s a lot of sharing and collaboration with the parent organization. Saint Clare’s is the hospital proper, but it shares this campus with three other entities: MMG Weston, which is the family practice group also owned and operated by Ministry Healthcare, and I’m the IT director of that as well. Then we have the Marshfield Clinic Weston Center, which is over here, and then Ministry and Marshfield Clinic formed the joint venture on the campus called the Diagnostic and Treatment Center. That provides ancillary services for the entire campus – lab, radiology, cath lab, rehab, etc.

I’m over just MMG Weston and Saint Clare’s Hospital. At Marshfield Clinic, there isn’t a local director. They’re supported by the Clinic. Diagnostic and Treatment Center does have a local project coordinator, but we provide services to them. While I have 21 FTEs, resources are shared throughout those parent organizations because we are sharing systems, so I get services from them as well.

Can you prove the value of the technology in terms of cost or patient outcomes?

That was a little bit tricky for us. We didn’t personally have the before and after picture. In terms of looking at our guiding principles, which was to avoid a medical record filing room and storing charts, there was quite a bit of cost savings upfront. Same with PACS. We don’t have a radiology film room, everything is digital as well. A lot of avoidanace in the first place, but then we start to look at our outcomes and successes, that’s where we can try to do some benchmarking in comparison to our peers. We’ve been doing a lot of that. For the true use of CPOE, we’ve pretty much met compliance with all the mandates for best practice and quality outcomes.

For turnaround times on order sets, we’ve done some benchmarking. For delivering antibiotics stat, we’ve been able to turn that around in about five minutes. In a paper world at some of our peer facilities, it’s probably one and half to three hours.

The CPOE side was most controversial area. Lot of organizations are skeptical and taking a wait-and-see attitude. All of our order communications is as fast as the stat antibiotics. We’ve seen cost containment. We’ve been able to drive the doctors to use the formulary. They are 99.6% compliant.

The biggest result of all goes back to our guiding principles – optimizing the flow of information across the continuum. Having somewhat of an integrated system record, even if it is a best-of-breed vendor approach. Making sure none of our patients would be harmed due to lack of access to available information. By collaborating with Marshfield and sharing tools, have been able to avoid that.

Those are the types of things that we’re capitalizing on now and that process will continue. That certainly was a part of why Ministry and Marshfield looked at this campus as a unique opportunity and put quite a bit of effort into it, because it was an opportunity to look at how can we do this from the ground up and apply some of those lessons learned, good and bad, to rest of the organization as we continue to develop an electronic health record strategy.

My advice to others is to develop your strategy and stick to it. Get buy-in and understanding from senior leadership. The vision must be accepted at the senior leadership level. CPOE is not easy to implement. Make sure everybody is committed to vision, but adaptable. It’s a continuous evolution.

Where do you see yourself in ten years?

Hmm. Geez, I just don’t know. [laughs] Continued growth and development. Probably still in healthcare IT – this is definitely my passion. So, I can’t say for sure where exactly, but I’ll be doing something similar.

Your formal medical informatics training sets you apart from most IT leaders.

It’s absolutely been a plus. It’s been a weird development, I guess. I actually started out in health information management, more on the medical records documentation side. As I was finishing up and about to start in that career is really when the whole electronic medical record future started to pick up. I though I’d keep on going, continue to not only work, but also develop my career on the IT side because that’s where I could see myself was development of the electronic medical record and continued process improvement of our healthcare industry through the power of technology.

It wasn’t necessarily what I planned on in the very beginning, but absolutely where I want to be now. It has been extremely beneficial for me not only to have the technical training, but also have that healthcare background so I can communicate effectively and collaborate with my peers on the clinical side of the business, but also can effectively manage the IT technical component.

What do you do when you’re not working?

Who’s got time for that? [laughs] That’s an interesting question, probably another lesson learned. While it’s very fun to tell this story now, it’s been quite a journey to open an all-digital hospital, even if was from the ground up. It’s an incredible amount of effort and work. While it’s been extremely beneficial and a wonderful opportunity, it also was extremely busy. We found the eighth day of the week many times. It’s been such a great team-building experience. This will probably be one of those things that I’ll always look back as such a great experience and great friends for the rest of my life. Not a whole lot of time for everything else in life. But now that hospital is open and we’ve gotten into a little bit more of an operational mode, we’re going to get out and do some more fun things.

HIStalk Interviews Jon Phillips, Managing Director of Healthcare Growth Partners

November 12, 2007 Interviews 4 Comments

I like to do a high-level business update about the healthcare IT industry once or twice a year. My go-to guy is always Jon Phillips of Healthcare Growth Partners, LLC. Jon is careful with what he can and can’t say (unlike me, he won’t just gleefully blurt out sensitive information to the whole world) and if you check his track record from previous interviews here, he’s done very well in his analysis and prognostications. I always enjoy chatting with Jon and appreciate his taking time to share his thoughts with HIStalk.

Characterize the M&A market so far this year.

This year, we’re looking at well ahead of recent years in number of transactions even than the markets of recent years, which have been pretty active. What we’re seeing is activity in the sub-200 million dollar range. You haven’t seen much in huge deals going on, but seeing a lot in the middle market and sub-middle market. That bodes well for continued strong M&A activity in the space over months and years to come.

The big difference this year, and there are probably three that I would consider somewhat bellwether transactions or maybe four, is where you have financial sponsors making significant plays into the healthcare IT space. One of those, obviously, is Francisco Partners acquiring Dairyland. Two is Battery Ventures acquiring Quovadx. Three is Vista acquiring Sunquest, Four is potentially Insight and the Bessemer guys acquiring Netsmart, and five could be Primus acquiring HMS.

You’ve had a lot of financial sponsor activity in the healthcare IT space this year. That means a couple of things going forward. I think that these companies under new ownership are going to see some shifts in strategy. Not all of them, but some of them are certainly going to see shifts in strategy.

Take Sunquest, for example. Now that the CPR piece has been decoupled and Sunquest has been pulled out of Misys, all of a sudden you have a business that looks very different than it did six months ago. The growth opportunities are different. You have an organization that most likely will look to acquire new assets to augment their existing position and to grow in new ways.

For each of these financial sponsor deals, you’re going to see aspects of that. They may seem like small changes at first, but over time, you’ll see more and more. Quovadx bought Healthvision. My bet is that they’ll look to buy other things as they go forward. I think you’ll see acquisition activity and interest from these new kids on the block.

The pressure that will put on the other strategic players in the market, the traditional acquirers of choice like McKesson and Cerner and GE, they’ll start seeing more competition in situations where they’re looking to buy things. If you’re a small company, it’s great for you, because instead of having one or two people to talk to, now you have a lot of people to talk to. A small company can be more bullish about exit opportunities than you’ve been able to for quite a long time.

What’s hot and not in healthcare IT?

If we went back three months before the dislocation of the credit markets, I would have said that the hot opportunities are companies that are meaningful size with strong EBIDTA performance and a conservative investment platform for investment sponsors. Dairyland, Sunquest, HMS – organizations like that four months ago were on fire. You’ve seen a little bit of a slowdown because sponsors can’t put as much debt on them as they’ve been able to earlier in the year. There still will be a market for them because when a company gets to the 30 to 50 million dollar size with strong EBIDTA performance, but you’ll see some compression in the value that people can put forward on them.

In terms of what I see as hot, if you look at where the venture investment is going into, I’d drop it in three categories and there’s not a lot of change. There’s still a lot of interest in revenue cycle. Part of the challenge is defining what revenue cycle is. There’s a lot of interest in solutions that address revenue cycle challenges. More financings will be announced of companies in technology business and services businesses that are focused on fixing bits and pieces of the revenue cycle. The large majority of them fix bits and pieces. You don’t have anybody who’s going soup to nuts. Still, those point solutions can still deliver a lot of value to customers and that’s what’s driving investment VCs.

The other areas with a little more froth in the market come back to some things that are geared toward consumer-facing solutions, things that help manage information or care in consumer-directed or higher deductible type health plan environments. There’s some strong interest there.

Others get back to clinical content and clinician collaboration tools. Figuring out different ways for clinicians to work together and to exchange thoughts and ideas and being able to capture and then present back out the resident knowledge. That’s another area that’s pretty hot.

One that I’ve heard more about, and it will be interesting in how it plays out, is the whole remote care, telemedicine, home monitoring, and different ways of to deliver care into non-institutional environments. I’d stay that’s still a little bit earlier on in terms of the froth, but you’re starting to see people get more excited about that.

What do you think about Health 2.0?

I always tend to be a little bit skeptical of buzzwords. Some of the solutions that are out there, like the clinical content solutions that I was talking about, there are some really cool things that people are working on, When you think about the applicability of these technologies, or not even technologies but business models and care models, to the existing healthcare environment – you start getting pretty excited about that. Just different ways to give people a platform to work together and access knowledge that they wouldn’t otherwise be able to access.

We’re all in this to try to improve healthcare overall. You gotta think that by bringing more of that knowledge to bear, you’re going to be able to improve healthcare overall. I still think there’s a lot of noise around it and I’m not sure how all the business models will play out, but it’s definitely exciting.

We are seeing a lot activity on the interoperability and portal side. I’ve been a big fan for a long time. I’ve never run a hospital IT department, but solutions that let me manage my application migration myself on my schedule, not being forced to make changes because of interoperability requirements, those types of solutions strike me as being able to bring a lot of value. I characterize those as different aspects of Health 2.0 solutions that are clearly provider-facing, not consumer-facing, but you recognize that there’s a lot of data and information that’s already out there and tools that help you access that. They’re going to drive improved outcomes. It’s not necessarily a direct causation relationship, but the more information you have … think about clinicians. They are very smart people. Give them more information and tools to work with and they’ll use that and you’ll see that in healthier patients and better outcomes.

Private equity has gone crazy since we talked last in January. Explain how it works and how it has affected the industry.

Different private equity funds are going to have different approaches to how they like to build businesses. Some like to buy things cheap and fix them. Some buy pretty good companies and make them a little bit better. Some buy really good companies and help them be really good on a larger scale. So, you have these different approaches to the private equity marketplace.

Funds have acquired businesses in the healthcare IT space. Their focus is to generate a return in a reasonable timeframe. They may be willing to have a longer-term hold, longer than two or three years. Francisco Partners turned around their Lynx investment very quickly on a relative basis, but the investment was performing so well that it was the right time to do it and they got an incredible outcome from Picis on that exit.

These guys have made investments and the way they will make money is by really two ways. One is organic growth, the other is inorganic growth. They can augment those returns because they put debt on the company to start off and get leverage on their investment. But, the reality is that these guys need to figure out how to grow these businesses to get the kinds of returns they want to get. Companies that may have been a little more passive historically will probably get more aggressive in management and personality.

The direction for these companies is to be more aggressive toward growth. You also will see ongoing acquisition activity, especially in companies that are under $50 million in revenue, as these businesses look to add on pieces and capability so that they can take their organic growth rate, say 10 or 12%, and augment that with acquisitions and move that up to 20 or 25%. That really helps them get the returns they want to get.

At the end of the day, to get the returns they need, have to have some kind of exit. It can be an IPO, like athena. They can sell to strategic, like Francisco Partners selling Lynx to Picis for a strategic exit. Or, they can sell to another private equity firm. They have different approaches and sizes, so a smaller fund can always grow a business up and then sell it to a bigger fund. What you’ll see is a good amount of activity as these businesses position themselves for growth. Then will see those folks making the call to find a bigger home and see them making those decisions as well.

What’s the track record of private equity owners with respect to making R&D investments, keeping customers happy, and not flipping the company at the first opportunity?

I think some of the private equity folks will actually be better owners than the historical ownership, not to knock the historical ownership. The private equity owners are going to be very focused on how to grow the business. You can go buy stuff, but you also have to be able to sell more to new and existing customers. These guys are smart enough to realize that you can’t sell stuff to customers who don’t aren’t happy with what you’re giving them.

I’ve had conversations with a number of folks involved in both investors and management of these companies, and what you’re hearing about is a renewed level of focus on customers. Customers can actually be better off. When you think about it, when a strategic acquirer buys a business that’s in the same line of business of something they already have, one of those customer sets will have a migration path. They won’t want to support both customers on different platforms indefinitely. A strategic acquirer will have to manage a customer transition.

The financial acquirer wants that customer to be happy and to buy more things from me so that I can both grow in terms of selling new stuff, and on the maintenance side, I don’t have people who say they don’t want to fool with me any more and I’ll find another vendor because your product is behind and you’re not giving me decent service and a reason to stick. My argument would actually that these private equity owners can result in good things for customers.

The folks that will have the toughest time are organizations that have gotten used to operating in a certain way. You have folks coming from outside of healthcare IT, and some ways that’s good and in some ways that’s bad. Healthcare IT as a market has a lot of very unique characteristics. If you don’t understand those characteristics, you can really fall flat on your face.

There are some evolutions have occurred in other IT markets that haven’t hit healthcare yet. Some will never hit healthcare, some of them will hit healthcare and some of these folks bringing some outside perspective can bring value by saying, “This is how it played out in Market X.”  If you think about your business in different ways as a vendor, you might find ways to make customers happier and grow your business.

So I think that for customers overall in the near- and mid-term, it’s a good thing. The downside is the next round of exits, because you know they’re going to sell at some point. You hope they become strong enough when they do get sold, they’re not getting sold into a situation where somebody’s just buying them for the footprint and moving you off that system and onto something else.

Give me a grade for each of these publicly traded companies in terms of market share, image, management, and return on shareholder equity:

McKesson

In terms of market share, they’re absolutely getting an A because of their footprint. In terms of customer retention, I’m not sure what grade I’d assign, but what I’m hearing more of is that they’re having some customer losses. Historically, McKesson has been unbelievable in being able to hang on to customers. Traditional wisdom is that they didn’t try to find that many new customers. They weren’t trying to fight the ground war in getting new business hospital by hospital. I hear they’re starting to do more of that with some of their new capabilities that they have on board.

The Awarix deal that the did this summer … that they’re getting pretty aggressive in using that as an entry point. Awarix is a workflow tool for patient management hospital-wide, so it pulls information from disparate systems and presents it on flat screens that you have around the house. At a glance, you can understand things about census, room availability, where the bottlenecks are. It’s a patient throughput tool, very cool. McKesson is using that to push into new hospitals. They haven’t done a lot of that, so I’d give them an A in terms of what I’ve heard on that front. I’d probably give them a B in terms of customer retention because they’re losing more than they have in the past.

Eclipsys

At this point, I’d give them a B overall. They would agree that it’s taken them a little longer than they expected to right the ship. But, I also think that they still occupy a pretty interesting position in the market. They have strong capabilities. Organizationally, they’ve made the changes they needed to make to push things forward. I’d almost give them an incomplete. The judgment is still out.

Cerner

I still rate Cerner as being an A overall. Everybody you talk to, you ask them who frightens them in the marketplace, and everybody’s going to say Cerner. People can throw stones at different parts of their products and capabilities, but the reality is that Cerner, for better or worse, has defined the hospital information system landscape in a way that’s favorable to them.

Cerner’s question going forward comes back to where do you find growth going forward? When you’ve built up to be as big as they are, where do you go? I would expect that they wrestle with that internally. I’d give Cerner an A. Everybody knows about them, even outside of healthcare IT. They’re still the company to beat.

GE Healthcare

I’m going to stick with GE at a B-. I think they’re getting their arms around the assets they have, but every time they get their arms around the assets they have, they go out and buy something else, like Dynamic. When you look at where they fit, I’ve certainly heard good things about product development, but broadly I don’t feel like they’ve taken advantage of the footprint as well as they could have.

They have this incredibly strong brand, they’ve bought a lot of companies, but I would argue that, of the companies they bought, I don’t know how many you’d say were better off for having been bought by them. You can’t go through the list and say, wow, they bought that company and they really turned it into a massive business. You saw that on occasion, but they haven’t done a great job at taking advantage of the pieces they’ve put together.

Perot

I know less about them, but I would say that I’ve been surprised at some of the things they’ve done. I’d probably put them, honestly, closer to a B- or C. They’ve bought some things, but then lost one of the big contracts recently. I understand why people are in the outsourcing business because there’s huge opportunity there, but I haven’t heard that many, if any real success stories, in outsourcing. It’s an interesting thought, but then in practice, it just doesn’t seem to work that wall. It comes down to how different than other industries healthcare is, with a more complex mix of stakeholders. Aside of a few case studies, I don’t that they have a lot of folks saying, “Wow, I’m ecstatic about my outsourcing vendor.”

Quality Systems

They continue to stick to their knitting and I think they’re doing really well. I’d give them an A for focus. Anecdotally, I would give them somewhere between a B and C for delivery. I don’t know that that’s their fault, but they have so much opportunity out there that it’s tough to deliver.

The biggest risk Quality Systems and Allscripts and eClincalWorks and folks like that, that the more successful you are on the sales side, the more risk you’re taking on because you’re signing people up and it will take time to implement them. The longer that delays, you start digging a hole for yourself. It’s hard to argue that they’re doing the wrong thing based on the business they’re doing. From customer perspective, I get a little nervous about how long I’ll have to wait to get my system.

Sage Healthcare

I follow them a little bit. I think they’re probably a C to a D. Not through all the fault of their own. They stepped into a tough situation. They’re an example of an organization that stepped into healthcare most likely thinking it had some real similarities to other small and medium business, and they’re finding that the physician business is a challenging market.

Medical Manager had a great footprint, but those customers didn’t get a lot of care and feeding. When customers aren’t expressly unhappy but at least not happy and there’s a technological inflection point like the EMR hitting your sector, you’re in trouble. Your customers are going to go and you’ll lose more than you keep. That’s what they’re running into.

Misys

I think their new focus is good. I’d give them a B with little bit of an upward trend. They have this great asset in terms of the physician installed base. They just need to make sure they don’t run into the same issue that Sage is running into. If they can keep their customers happy enough so they don’t see them walking away. As customers go through technology replacement cycle, I want to make sure I’m on the winning end of a disproportionate share of my customers as they make those choices. They’ve got a fair amount of risk in front of them, but the focusing will help them out.

Mediware

I thought it was good to seem them start to focus more. The real question is, can they really figure out how to get some growth back? They have some interesting assets, but have to put them on a C on growth side until the most recent quarter. It’s good to see that most recent deal they did was focusing back on blood bank. It’s a good thing to reinforce what you’re good at and they’re good at that. They have an upward trend in front of them, but the jury is out.

Allscripts

Boy, up until the most recent quarter, I probably would have tagged them with an A based on what I was hearing in the marketplace. They were going a great job in getting big wins and were a really tough competitor. That doesn’t change with one quarter’s results, but you get a little concerned when a company operating in this great sector of healthcare stumbles. You wonder, is it due to growing pains, and if so, then look at them getting whacked 20% on stock price, then buying that’s a great buying opportunity. Otherwise, if it’s something fundamental, you get a little nervous. I’d probably give them a B, but I’d keep an eye on them because it could be opportunity to get in at the right price, but you have to see if the quarter was an aberration and not a trend.

Siemens

I’d give them a C. You get the sense that they’re buzzing around a lot, but you don’t get the sense that much is happening. They’ll have to continue to wrestle with whether this is a market they’re committed to long term. The answer has consistently been yes, but you keep asking the question because you’re not seeing them just rip it in the marketplace.

What do you think about big acquirers like InfoLogix, Nuance, and MedAssets?

I don’t know much about InfoLogix.

Nuance is really focused on strategically to be willing to be aggressive to build out a strong position. As a banker, you love to see that, but being a strategist as well, you wonder how all the pieces fit together at the end of the day.

MedAssets is especially interesting to me because they’re really a non-traditional player. Given the fact that they’re going public and they’re going to have lots of money and lots of margin and footprint, they could be a really big competitor for folks. I think it’s just a question of what they want to do. Do they want to focus on revenue cycle, or get into broader information systems in hospitals?

Given that they can touch so many hospitals, if I’m sitting in the competitive intelligence department of McKesson or Cerner or one of those places, I’d keep a very close eye on MedAssets. I’d want to know what those guys are doing. They’ve been pretty creative and can they certainly could continue to be creative.

In terms of other players, you’re going to see more and more offshore organizations looking to buy entry into the US market. Indian companies and other Asian organizations looking to take advantage of the labor force that they have and looking at the US market and trying to find targets that have a labor component that they could offshore.

When you think about situations with labor requirements, where you have systems that you can deploy that have labor associated with them. Revenue cycle is a good example of this. You can put the technology in place, but if you don’t have people to run after the claims or other aspects of it, you’re leaving money on the table. I think what you will see is a continued push by offshore organizations to find US targets where they can get some of that offshore arbitrage.

Are Microsoft and Google serious about healthcare or posers?

They’re serious about it, but I also think that they consistently underestimate the complexity of the market. A lot of people do. Microsoft has certainly done some interesting things with the businesses they’ve bought in the space, but they have to figure out where they’re going to fit and who they want to be. Are they going to be an enabler or in the application space? You look at them and they’ve got brand and reach, so they should be able to do things in healthcare.

I tend not to get too excited about some of the big healthcare initiatives these guys put out there. On the PHR side, I spend a lot of time around PHR businesses. It would be great if everybody had a personal health record and they all do it with Microsoft HealthVault, but you think through the challenges of how you get information in there. You don’t want to type it in, but because of privacy issues, you don’t want to have someone do it for you because who knows where the information will end up. You have challenges on the personal side of healthcare that won’t be resolved for awhile. For Microsoft and Google, I think they absolutely have huge opportunities and they recognize there’s a lot of money to be made in the space, but they will have to go through a bunch of iterations to get there.

There were rumors going around that Google was going to buy WebMD. Let’s say they did. What does that really do? How many people do you know who are using WebMD for more than a basic reference tool? The consumer market is tough. You haven’t had people have a lot of success there for a reason. As fragmented and challenging as the provider market is, it’s far simpler than consumer side.

If someone wanted to invest in early-stage companies but doesn’t have the $1 million it takes to be an accredited investor, what are their options?

It tends to be pretty tough. To get into a private equity fund, you must be accredited, and even then it can be pretty tough to get into private equity funds. The other part, in terms of direct investing, you still have the issue of being accredited.

I spend a lot of time thinking about that. One of the great opportunities in this space is that there’s such grassroots knowledge out there that it would be great to capture that and to let people invest and to be able to get return for the fact that they know what’s going on. Mechanically, it’s tough.

One of the challenges is that, in the early stage of healthcare IT investing, it’s a pretty small universe of funds that will do that. You and I know some of the characteristics that will make these small companies successful, but from an investor perspective, you have a whole raft of risks. If you’re not living and breathing healthcare technology, you’re not comfortable with a lot of those risks. You don’t see a lot of funds that have made plays in early stage healthcare technology because a lot of them made bad investments and lost money. It’s hard to find funds that are interested in doing that, much less putting your own money to work.

If I can figure that out, I’ll let you know, because I think there’s a great opportunity there in working with early stage companies. It’s not formulaic, but there’s a lot of common problems companies have. We see it in our client base. The challenges aren’t that different between companies. So there’s some benefit you can add just having that knowledge, saying let’s figure out how to apply it and help those companies grow and the best way to do that is as an investor.

How about the practice management market? Any projected winners?

I still think on the practice management side that you’ll continue to see a divergence, guys who will be software-focused and those will be services-focused. So not just services in terms of the subscription model for software, but bringing a broader set of services to the physician practice.

Take athena vs. Quality Systems. Athena uses a lot of technology and maybe they’re a technology company, but they’re really providing services, whereas Quality Systems is a technology company. In terms of who will win, I come back to that scale is incredibly important in the physician market. There are a lot of companies that have 200 or 500 docs, but you have over 200,000 practices. It can be a high cost of sales to go after those practices and try to convert them. Scale will be a big differentiator. Product will continue to differentiate, but a bigger company with a weaker product will still probably have a leg up over a smaller company with the best product out there.

Do you still like Teletracking, DR Systems, and the handheld vendors?

I do. When I come across a company that is bringing a fresh perspective and making money while they’re doing it, I love to see early stage companies that don’t have a lot of revenue that have cool technology because some of those guys are going to make it. The difference between making and not making it is picking the right strategy.

When I look around, I’m still a fan of the privately held businesses that keep plugging along and doing their thing, focusing on being the absolute best at what they do and not necessarily saying they have to do everything for everybody. Lots of companies that fall into that category. Those are businesses that you like to be around. You go through the KLAS rankings and see how many companies are out there and how many of decent size with really happy customers. That’s pretty cool. If you look at the top-ranked vendors, you get pretty excited when you see them serving customers well and growing their business and making money.

Instead of saying I like specific kinds of companies, I like companies that have strong technology and really happy customers who are really using the product. There are a lot of technologies out there where they get a couple of customers who aren’t really using the product. All the stuff we’re trying to change broadly – if people won’t use the technology, it’s still worthless.

What is athenahealth’s IPO telling the market?

To people who are either owners or employees of healthcare businesses, the capital markets are pretty interested in stories that help them. Jim Cramer said he’s a fan of any company that addresses the cost problem of healthcare. That’s a pretty blanket statement and a lot of people believe that. The stock came out at 18 and is over 40 today. Athena is trading with the expectation that it’s an option on improving efficiency in healthcare.

It’s nearly impossible to justify that price based on the fundamental performance of the business today. But, if you look forward, athena is a leader in a market that has a massive amount of opportunity, and as such, people are saying they’d rather in invest in Quality Systems in 2001 than in 2007. If you can communicate your business model and deliver numbers, there’s money to be had to fund it.

What’s the best M&A deal of the year so far from the buyer’s perspective?

I would probably say that the best one for the buyer is the McKesson Awarix deal. Awarix certainly wasn’t a $100 million business when they bought it, revenue-wise. McKesson was willing to make a strategic change in terms of what they were looking to do. They’re effectively rapidly going to market with that. It could be the most transformative and impactful of the deals.

What other industry segments are going downhill and likely to take some companies with them?

I think you’ll see a shakeout on the physician software side. I don’t think the segment is going downhill, but will see a shakeout there with all those CCHIT-certified vendors. You haven’t seen much consolidation there in a long time.

You’ll see that in the RIS-PACS marketplace. The aggregate enterprise value of Merge, AMICAS, and Emageon is less than $200 million. Each of them were valued at multiples of that not that long ago. Some of it’s the impact of the DRA, others because of company-specific things. A lot of people are still buying in that sector, but those guys have had a rough road. AMICAS is turning the corner, Emageon had a rough quarter. Merge is caught in challenges. The sector has been challenging, but it can’t be that challenging since GE bought Dynamic.

What changes would you predict for the upcoming year?

I think you will see sharper competition for new customers and for holding on to existing customers. It’s always been competitive and a highly fragmented market with a lot of small and large companies that run around. You can have a hospital systems vendor that can really make a go of it with three or four hospitals that they sign up from the start and bootstrap from there.

I think you’ll see a paradigm battle between best of breed and enterprise continue and probably heat up. Since so many hospitals have made large scale systems decisions and picked their big player, you will see a lot of fighting to capture the IT dollars around that big investment. The private equity investment … some companies that might have been a little more laid back will have pressure ramped up to deliver growth and profit. From a customer perspective, you might find that this next couple of years is a good time to be a customer, not that you didn’t have people fighting for your business before, but they’ll fight even harder.

I think you will see more of a focus on getting value from IT investments already in place. You hear a lot about healthcare technology investments, “We bought the system, but it’s not delivering even the soft ROI that we justified the investment with.”

This is part of why you’re seeing consolidation on the consulting side. People are realizing that consulting organizations are they’re bringing value in getting systems in place and some specialty firms actually help out with the adoption. That will be a bigger and bigger thing. If I’ve spent seen or eight figures on IT investment and it’s not being used, I have to figure out how to get people to use it. I can’t just throw it away and start over.

Given the issue with bond insurance companies, I think you will see capital constraints because of capital markets and operating pressure because of reimbursement trends from third-party payers and self-pay. You must be more efficient with the resources that you have.

The Huffington Post is a blog that raised $10 million in VC money. Is this a sign that exuberance is irrational enough for me to take HIStalk public?

I think if you took HIStalk public, you could expect a valuation that would be at a significant premium to the athena valuation. I would argue that you could go ahead and start interviewing bankers for this. I would say you’re worth somewhere around two billion dollars. [laughs] I’ll get a call from Jon Bush after this, asking, “Hey, are you saying I’m overvalued?”

People focus on return. In terms of what you’re building, you’re not just grabbing eyeballs and clicks. If people are looking at the information and the content that you’re bringing together … and this is in all seriousness … and you’re capturing decision-makers as they’re looking it and shaping their decisions, there’s a lot of value in that. Seriously.

You’re jumping off the $2 billion thing, but there’s a lot of value in the fact that you’ve got an audience who are really influential in the healthcare space. The challenge that you have … you’ve done a great job of monetizing it, because you’ve done a great job balancing it between making money without compromising the integrity of the commentary. The challenge in putting venture money in … I’m not saying that you’d ever compromise the integrity … is that the pressure goes up to find more revenue and be able to continue to grow that revenue line.

I think you’re doing the right thing the way you’re doing it, but I tell you what, if somebody comes along and offers you $10 million for it, you probably should think pretty hard about it. [laughs]

HIStalk Interviews Jay Parkinson MD MPH, House Call Doctor

November 5, 2007 Interviews 13 Comments

jay

jaysite

Photo and site: Jay Parkinson, MD, MPH

I didn’t have much trouble tracking down Jay Parkinson. He’s ubiquitous for a guy whose medical practice is just a few weeks old. He’s been interviewed many times, has a blog, and apparently is coming soon to a TV near you, all because of his Medicine 2.0 – which is actually Medicine 1920s – making house calls, charging reasonable cash prices, and being available whenever his patients need him, all in the hip Williamsburg neighborhood of Brooklyn.

He insists that it’s not about the technology, which in his case is the PC tools everybody else uses (Google apps, e-mail, IM, etc.) He doesn’t even use an EMR system any more, having given it up because it didn’t meet his needs. So, the lessons to learn from Jay aren’t about use of cool technology, but more about practicing medicine the way he wants, addressing some of the challenges of the healthcare system along the way.

Tell me about your background and your practice.

I’m a 31-year old male. [laughs] I practice in New York City, mostly in Williamsburg and Brooklyn. I started the practice September 24 after two residencies, the first one in pediatrics at St. Vincent’s Hospital here in the West Village and the second one in preventive medicine at Johns Hopkins in Baltimore. Seems like it’s going pretty well for me.

Most people associate house calls with country doctors carrying little black bags, but you’re in New York City.

I still have my black bag that I carry. Just getting around the city is next to nothing. You take the subway, walk, or take the bus. In the near future, I’ll be buying a scooter so I can scoot around. Hopefully I can keep every house that I visit within a 15-minute travel time.

Describe a typical patient encounter.

It’s great because they submit all their information ahead of time, so I pretty much know what’s going on prior to the meeting. I know what to talk about, what points to hit, what things I can skip over that other physicians would concentrate on and waste time on. They spend 10-15 minutes giving me all their health information via an online form. It’s very streamlined, but I still spend about an hour and a half per visit, talking to them, having them show me their art work. It’s very laid back.

I’m not a very formal person. Everybody that I’ve seen has really enjoyed seeing their doctor rather than being in some sterile, foreign environment that everybody knows and loves as a doctor’s office.

What’s it like making house calls and what do you learn that an office-based doctor wouldn’t?

Somebody has asthma, maybe lives in a dirty warehouse loft, I can pick up the fact that it’s pretty friggin’ dusty or has mice. It just gives you a feeling for who somebody is. You can tell a lot by how they live, more from a mental health perspective. The United States is a pretty clean place so we don’t have a lot of sanitation issues or something, but it gives you a more full picture about the person.

What technology do you use to run your practice?

It’s very basic, freely available technology. I have a Macbook and an iPhone. IM programs, like ATM and iChat for the Mac. I just use regular e-mail, Gmail in fact, because it’s very powerful.

I use a website called Formspring for my online forms. It’s very simply drag and drop forms creation. Any form can be made in three minutes or so. It uses skip branch logic, so questions can appear or disappear based on responses to previous questions. I use that to get another diagnosis through a careful history, because an early question is a branch in the algorithm for proper history taking. I think it’s safer because doctors aren’t perfect and sometimes they forget to ask very important questions about something rare. If I can spend time asking these questions beforehand, I don’t have to be worried about always thinking about every little thing during my interview session with the patient.

I saw on the Web that you use the Life Record medical record system. Tell me how you chose it and how it works for you.

Actually, I have abandoned that, simply because it’s not very customizable and I thought it was going to be. So, I’ve abandoned that. But, I was fascinated by it because it has a lot of features that I think would be very valuable for a traditional office-based practice with multiple practitioners. Having access to records by iPhone on a Friday night at dinner is vital in some circumstances.

Now I use Apple’s version of Excel called Apple Numbers and have created templates for nearly every condition that I have. I can use them for a physical exam or generating an invoice. It’s really just using Apple’s iCal for scheduling synced to Gmail’s calendar. iCal and Gmail and iPhone are all updated at the same time in real time. It’s pretty basic stuff.

You’re an iPhone fan, I hear.

I love the iPhone. I think that’s amazing. Hopefully I will be able to put Apple’s Number files on my iPhone. I think they’re coming out in with developer’s kit for iPhone in February and I’ll be able to use my iPhone a little more intensely. I could only get to my records by iPhone with Life Record. He’s a great guy, the guy that developed it, and I’m sorry it isn’t specific for what I need.

When it comes to technology, you seem to be a geek, but you deal with artists and are one heck of a photographer. Where do you fall on the geek-doctor-artist continuum?

I’m definitely fairly geeky, I guess. I really like technology and gadgets. Right after the iPhone came out, I wasn’t going to wait in line forever down in Baltimore. I’m all things Apple. I did the iPod first day it was announced years ago. I designed my own website and can do programming. I don’t know CSS or anything like that. I’m not trained in any technology, I just kind of figured it out on my own.

You charge $200 a house call. Do patients find that competitive and can you make a decent living at that price?

Sure. Look, I have no overhead whatsoever. If I charge $200 a visit, $195 of that is straight profit. I think that’s a pretty good living. If I see eight patients a day, that’s $1600. Without having staff, an office, billers … it becomes a very easily doable practice. I definitely designed the business model looking at that. The concept of doing the housecall was a way to open a practice without putting $300,000 upfront. I started this whole thing for less than $1,500.

Would your med school classmates think this is weird, or are they looking for more satisfying practice models too?

Everybody that I’ve trained with has been extremely supportive. I just got done with an interview for the London Times. Obviously there’s something interesting about what I’m doing since now I’m making international news.

What I’ve created, not to toot my own horn, is pretty ingenious. It’s a Band-Aid to a gaping wound in a lot of ways, the fiasco that is the American healthcare system. 50 million people without health insurance – there are a lot of voices behind what I’m trying to do. I’m doing a good job, I guess, getting the word out about the plight of the uninsured and also seeing patients at the same time.

A few people have mentioned security and privacy issues because of the technology I use, but because I don’t deal with insurance companies and don’t submit any patient health information online to insurance companies or Medicare or Medicaid, I don’t have to follow HIPAA regulations. I’m considered a country doctor, which is kind of interesting.

On your website, you talk about how you search the market to find the lowest fees for specialists and other medical services you can’t provide directly. How do you do that and what interesting stuff have you found as a result?

It will blow your mind what I found out. I graduated residency June 30th. Since then, between June 30 and September 24, there’s a good three months where that was what I was doing, finding accurate contact info for physicians in New York City and calling them up and asking what they charge, putting the information into a database. A mammogram ranges from $175 to $750, both of them amazing facilities, but nobody’s regulating healthcare prices.

Also, there’s widespread belief in the healthcare industry that they shouldn’t be competing for cash-paying patients because there’s so few of them. 50 million isn’t that few at all, but there’s no free market in the healthcare industry. The vast number of people have health insurance and doctors aren’t competing for their business at all. Its so funny, when I tell radiologists or pharmacists or anyone who stands to benefit from me referring my cash-paying customers to, it’s laughable how they kiss my ass to try to get my business.

The ultimate goal here is to create more transparency in the healthcare pricing scheme. I’m trying to create that transparency on my own because the healthcare industry won’t do it because they profit from that.

How would you compare what you do with the retail clinics that are springing up everywhere?

Most of the time, it’s simply a profit-driven marketing scheme. I’m personalized service. You call me up, I go to your home, physically examine you, follow up by IM or e-mail or text messaging. I get to know you as a person. I’m not remotely competing with retail clinics at all. People who go there want something different than I provide.

From your viewpoint, what’s the most wrong and most right about the US healthcare system?

It depends on who we’re talking about. Older people and very poor people, there’s absolutely nothing wrong with it whatsoever. For people who have insurance, there’s not much wrong. People who don’t have insurance because they’re young and healthy and priced out of paying an average $10,000 here in New York for an HMO, there’s a lot wrong. It really just depends on who you’re talking about. It’s hard to generalize that way.

My patients are people who are concerned about having or not having health insurance. New York State has policies that ensures that everyone pays the same for health insurance. That’s great for sick and old people, but young people can’t justify spending $9,500 when they only make $45,000. That to me is a significant problem for the uninsured in New York State. It’s a great solution if you’re old and sick.

You just started this practice and here you are, four or five weeks later, you’re in newspapers and on TV. You mentioned in an interview that you’re getting unbelievable offers to do TV and books. What’s coming your way?

You name it, I’ve gotten it. It’s pretty insane. Keep your eye out, probably next fall, for a TV series from a producer of movies that the whole world has seen, She’s getting back into an original series. I’m starting to write with her in a week and we’re going to start developing a TV series together, not a reality series. The major networks are interested in this concept. We’re developing it so it appeals to everybody, but it deals with the healthcare issues that are afflicting America. That’s in the works.

I got a book offer on Monday, so I’ll be writing a book about the healthcare industry using examples from my life and practice. The London Times was today. I’ll be doing a big talk show soon and Steven Colbert on November 12. It’s kind of insane. They’re all coming to me. I don’t have a PR person. I’m doing everything myself. I haven’t put out a single press release.

Is is scary that people want you to comment on an industry that you’re brand new to?

No, not at all. Sure, I don’t have experience in private practice dealing with insurance companies, but I’ve worked and talked about the healthcare system for years, getting my master’s in public health. I worked with Sidney Wolfe in Public Citizen’s Health Research, Ralph Nader’s consumer watchdog group in DC. I’ve worked at the Maryland state department of health level. I worked with National Association of Firefighters as their medical consultant. I’ve done a lot.

I’m not like a normal doctor who finished a residency and sees patients. I intensely studied the healthcare system and figured out its strengths and deficiencies. I spent the last three months at Hopkins on quality of patient care, studying quality in the American healthcare system. Doing Six Sigma and Lean Kaizen in various departments in Johns Hopkins, trying to figure out where the patient problems lie, problems with reimbursement and unsafe practices that lead to poor outcomes. I’m not worried about being a spokesperson.

Do you think you’ll keep practicing with all these offers?

I wouldn’t mind doing part-time for both. One thing I don’t want to be is part of the industry. I’ve got plenty of offers to join companies and form alliances, but then you become part of the problem, like most doctors. The practice of medicine is very conservative and appeals to a conservative type of person. They don’t really teach you to think outside the box. They try to prohibit you from thinking outside the box.

A lot of people are getting hung up on the “doctor who makes house calls.” Really, there’s no difference in seeing a patient in their homes instead of in the office. I don’t have a laboratory, so I can’t do rapid strep tests. It’s a little difficult to do male urethral swabs, stuff like that. Female exams, I just don’t do, but I refer to someone.

There’s really no difference between a house call environment and an office environment. I draw blood as I need it and a car comes up and picks it up outside my apartment door each night. To me, it was just a business model to start a practice on the cheap. People are also hung up on the technology, but it’s the stuff that everybody uses in every other industry in America. It’s just not being used to communicate with doctors.

Most doctors don’t even want to get patient e-mails.

Congress just passed a 10% Medicare reduction on to physicians yesterday. The only way doctors are making money these days is volume. If you see 30 patients a day, at 6:00 you go to your computer and there’s 30 e-mails, God, I can’t charge for these just yet. Why would I entertain the possibility of receiving e-mails from my patients? I understand why doctors are averse to that.

The way I treat patients, I can see six to eight patients a day, and as I’m traveling, I can answer e-mails. I’ll receive forms in my e-mail from patients who want to see me in the next hour if I’m not busy. With an iPhone and a Macbook, its ridiculously easy to keep track of everything.

You obviously love New York.

I’m a big fan. It’s the center of human culture. Everything is right here. If you want to go see this really obscure movie, it’s playing down the street. If you want to see this amazing photography by the best photographer in world of all time, it’s coming to town next week.

A woman was visiting me from Ireland and said something that describes New York as a summary. She said, “The one thing I love about New York is that the answer to every question is yes. It might cost some money, but the answer is yes.” She asked if I’d been to Ireland and I said no. She said the answer to every question in Ireland is either no or maybe.

The architecture and infrastructure here is just awesome. You don’t have to have a car.

Will you stay there or go Hollywood? You could leave your practice after one month and be in the public eye constantly if you wanted, doing stuff that people only dream of.

I’m not to going to go Hollywood, at least not yet. It seems that way, doesn’t it? We’ll see what happens. If I can start some sort of system … I have ideas and I have people backing me to create something along these lines that can benefit more than the 1,000 patients I can see here.

You could easily be rich and famous.

You should see my apartment right now. [laughs] It doesn’t look like I’m rich and famous just yet. But It’s New York, where the answer to every question is yes. The opportunities for me are endless, I think.

HIStalk Interviews Robert Seliger, CEO and Co-Founder of Sentillion

October 15, 2007 Interviews No Comments

Robert Seliger
Photo: Health Management Technology

Security and privacy in healthcare are obviously hot topics. So, when Sentillion decided to sponsor HIStalk a few weeks ago, I pressed my luck and asked for an interview with CEO and co-founder Rob Seliger. I knew the company was refocusing a bit and also introducing a new single sign-on application called expreSSO, so I offered as bait the chance to talk about that. When I got on the phone with Rob, he said he’d be happy to talk about anything and that we didn’t have to pitch product. Good answer.

When I hear either “single sign-on” or “CCOW”, I think of Sentillion first because they’ve been doing it for a long time. They’ve introduced some new products I wasn’t fully aware of, including the vThere virtualized client for remote access.

Thanks to Rob for the chat.

Tell me about Sentillion and how you came to create it.

Sentillion was founded in 1998, spun it out of the former HP medical products group. I have the simplest resume on the planet – paper route, HP for 18½ years, then Sentillion. [laughs] I was working on technology that integrated applications not on the back end, like databases and integration engines, but on the front end of care, looking at the user experience of the caregiver, whether using applications from the same or different vendors.

We determined that our technology would serve better as a glue, run as a neutral company. We built a business case, they agreed. We spun the IP out with myself and my co-founder in 1998. We did three rounds of venture capital, the last one in 2001, and have been growing the company every since.

We moved from general integration to specific applications used in identity and access management. What we’ve been able to do is create a whole suite of products that address identity and access management needs for healthcare and, specifically, hospitals.

We sell to provider healthcare organizations. We’re unique in that way. Our competitors sell to finance and banking and retail customers. We said that healthcare has special needs, workflows, idiosyncrasies, and constraints. We wanted to create technology that was purpose-built for healthcare. Fast forward and we have hundreds of thousands of caregivers in hundreds of hospitals in the US, Canada, UK.

Healthcare security, like IT in general, seems to fall well behind that of most other industries, with lack of consistent authentication rules across applications, applications that don’t support LDAP or other centrally managed security, and heavy help desk use for password resets. Is it getting better?

It is getting better, but slowly. There are reasons why stronger security technologies have not been broadly adopted in healthcare. The main reason is that they get in the way of delivering healthcare. I’m not a physician or nurse, but I have a tremendous respect of what those people do for a living, taking care of people as their number one job. Navigating security isn’t what they’re paid to do. Our customer base is some of the smartest, most highly trained people on the planet and they’re adept at finding workarounds to impediments to delivering care, including security.

Part of our process is leveraging the years of experience we have in the care business. How many other security companies can you name that have a chief medical officer? We hired Dr. Jonathan Leviss as our Chief Medical Officer because he had a passion to eliminate the obstacles between caregivers and the productive use of computers.

You’ve heard of the last mile problem, like with DSL, where you can’t get connected if you’re too far from the telephone switch. I refer to our situation as the last inch problem, that inch that’s between the caregivers’ fingertips and the keyboard they don’t use. We provide security solutions that make them more productive instead of less, while instilling better security practices across the organization.

People often say that healthcare is slow to adopt technology, yet you can look at the amazing equipment from imaging systems to robotic surgery that is used. I don’t see a fear of technology in healthcare, just an avoidance of technology that’s an impediment to healthcare delivery. Vendors often miss that. We work really hard to get that right.

What security priorities would you recommend to a hospital CIO?

My favorite thing to do if I’m allowed is to take a walk, particularly in care areas, and watch what people are doing, who they are, where the computers are, what they’re showing, and whether they’re attended or unattended.

UPMC implemented our solution years ago. They started deployment in the ICU. I was with an entourage of UPMC executives and I drifted back from the tour group because they were headed to a workstation that someone was using with single sign-on and single patient selection. I stood back and marveled at all the workstations that were not in use, but were locked. I asked UPMC when the last time was that all those workstations with no one around were actually locked. [laughs]

It’s kind of like the broken window theory of why neighborhoods go downhill. Good security isn’t just the things you do on your network with firewalls and antivirus software. It also has to do with what people can see. Show them that their information is being safeguarded and protected. How would someone feel being wheeled down the hall and seeing other people’s information on display? It could be their information as well. You must show personnel and patients that they’re doing the right thing.

You testified before Congress after the VA’s security breach. How would you grade their progress since?

The hearings were for the right intentions but for the wrong reasons. The breach that occurred with the theft of that laptop was benign. The information was not clinical and the thief who stole it didn’t know it was there. At the end of the day, it was a non-event. They didn’t get Congress to the point of understanding how to practice good security.

The VA has the same challenges as non-VA – security vs. usability, however people who work for the VA can be told what to do, which isn’t always true of community physicians in hospitals. The VA has its act together as well as anyone else. They’re continuing to make investments in practical security practices. They’re extending a pilot we did for deployment of single sign-on, which is the first step in a powerful direction for them.

The participation in that hearing was fascinating for me. It was literally like being in a TV show. Members of Congress were in seats elevated maybe 10 or 12 feet in the air, looking down at myself and my VA colleagues at a table. Each member of Congress took the opportunity to express a passionate opinion, not all of which were germane to the conversation at hand. Despite the hyperbole, they actually listened to what I said and what the VA said. They asked good questions. It was a remarkable discourse.

The hearings were well after 9/11, yet the halls of Congress, with minimal screening, are still very open to the public. It was a wonderfully reassuring about our way of life. It was wide open to people who wanted to come and listen and participate and not be overly encumbered with security.

I’ve done so much public speaking that I’m rarely nervous, but I was nervous. I would not want to be there for a serious transgression or offense.

If I looked at your laptop right now, what security measures would I find?

You’d find our product, Vergence, which is single sign-on and a bunch of other things. Virtually everybody here uses it. What do I like about it the best? I don’t have to remember my passwords for the system that approves expense reports, Webex, salesforce.com … the list goes on and on. What I like best is the sheer convenience factor. The screensaver periodically locks my workstation after about 15 minutes of unattended use. That happens whether I’m using it at home or in the office. We all use high quality passwords, mnemonics based on pass phrases, based on an elaborate sentence I can remember and choose some letters from it to make my password.

Unless you’re sitting in front of it, you wouldn’t see the display because of a 3M privacy protection screen. I was working on board financials on an airplane flight several years ago when the woman next to me leaned over, almost into my seat, and said, “You know how to use a spreadsheet.” I thought, “How long has she been watching me work on board financials?” Anybody who’s a road warrior in the company can have a privacy shield.

Security and privacy get confused. The woman looking over my shoulder wasn’t trying to hack our systems, but she was breaching our privacy as a company by looking at sensitive information. Both security and privacy need proper protection. The recent George Clooney story suggests that the concern is well founded that the biggest data access concern that healthcare organizations should have is what happens within their four walls. Too bad Palisades Medical Center isn’t a Sentillion customer, as this is not a good way to get one’s hospital in the news.

Are you happy with the progress that healthcare software vendors have made in making their products CCOW compliant for improving the user experience?

Interesting question. The general answer is no. We’ve put our heart and soul into the CCOW standard going back to the HP days. Standards in healthcare still have a fickle existence when it comes to vendors adopting standards and applying them thoughtfully and properly to their products and with the same interest as something that is purely proprietary.

Much of the venture capital we raised in the early days was spent giving market visibility to the CCOW standard. That helped to a point, but there are vendors to this day who have not implemented the standard or have done so in an incomplete way just to check off that they’ve done it, or done it in an elitist way, interpreting it in a way that’s good for their business interests but not as useful to the customer as a full implementation.

Often a customer will say to us, “You’re Sentillion, can’t you get Vendor X to do it correctly?” I keep looking for that sheriff’s shield or subpoena power to tell vendors what to do. [laughs] We’re just another vendor.

Our answer was that so much of what was conceived by us and others in the standard is extremely powerful, but if vendors won’t implement it timely or correctly, we need another way. We developed a technology called bridging that allows achieving the standard in a way that’s not invasive to the application.

The A-Ha was that the part of the application we can see and rely on is the user interface, as opposed to trying to inspect the application at a code level and hoping for an undocumented API or secret hook that we could latch on to. The user interface is tangible. Because that translates into a series of calls to the underlying OS, we created programs to watch for those calls. We can watch an application as the user is using it and see that they selected a patient. We can get that and send it to other parts of the application to automate patient selection, but without having the CCOW standards.

I read something where someone said that CCOW is a great standard, but that Sentillion controls it. Boy, did that rile me. I’ve been doing this for over 15 years, originally for non-CCOW work. There are very specific rules of engagement for a standards open development process, from NIST, a standard for being a standard, how you vote, how you achieve a quorum, etc. For an open standard, when you have a final ballot, people can vote Yes, No, or Abstain. You throw out the Abstain votes and 90% of what’s left has to be Yes for the standard to be valid. Imagine trying to get that level of agreement in your own family. [laughs] It’s a tough hurdle with lots of opinions, lot of eyeballs before a ballot passes. There’s no way any one organization can control a standard. They can be a blocker if they have enough votes, but they can’t force something to happen.

If there’s a secret to what we’ve done, it’s two things: show up to the meetings and document them. [laughs] I like to write and most people don’t, so often it is myself or others who volunteer to document the meetings, but that doesn’t mean we’ve done anything more than spending evenings and weekends to pull documents together for the greater good. The idea that an individual or organization can control a standard is unfounded.

When I Google Sentillion, I get ads for ComputerProx and Encentuate. What is the Sentillion value proposition over these and other competitors like Carefx?

The companies we’re most likely to compete with head to head are more often companies like Novell or Computer Associates, We’ll also see Imprivata. We don’t see a lot of some of the other companies that come up with the ad hits, even though they’ve latched onto the keywords. Across the board, for all our competitors, there are really three salient points.

First is the healthcare focus. A CA or Novell, while they have sales and marketing teams that cater to healthcare, have products that are generic that are supposed to work in 9 to 5 office environments and not necessarily healthcare.

Second, we believe strongly that we provide a fabric or glue. The last thing we want our customers to have to do is glue our glue. If we show up and say, “We have one piece of the puzzle and you’ll have to work with these other vendors”, that’s not particularly satisfying. That’s why we’ve invested heavily in developing our own products. All our products were developed by Sentillion so our customers would have a single vendor, a single number to call. Every one of our competitors requires multiple partners to do what we do as a single vendor.

Third is the incredible track record we have in getting customers live and keeping them live. We have hundreds of hospitals and hundreds of thousands of users. We monitor uptime across all customers and report to our board like it was financial information. Five nines. Who’s doing that for a security apparatus like we provide?

I hope you don’t think it’s bravado, it’s just pride. There are still hospitals using monitors that I wrote firmware for, like the HP Clover. I still feel pride when I walk by them in a hospital and know that patients are being cared for with something I wrote.

Why is desktop virtualization important?

Going back to this sense of responsibility to solve problems, for years our customers were asking us to help with people who are not physically in their facility, like community docs or docs working at home. We told them we could help to a point, but they’d have to build a portal or provide remote emulation like Terminal Server or Citrix, which requires an investment in servers and expertise. That’s an OK answer, but not satisfying for customers.

We were developing improvements to our internal testing apparatus. We do massive scalability tests to test response time and failure factors and failover. We were experimenting with the virtualizing of clients, not servers. 99% of what people are doing is on servers, putting multiple virtual servers on one physical server. We thought, “With a bit more work, we could provide a virtualized client to our customers.” That was the birth of our vThere product.

Take the clinical workstation with whatever applications, OS, service packs, etc. for people who are physically in your enterprise. You can make exactly that same environment available to people outside your organization. It’s transparent, no particular software package or OS, or even preventatives or antivirus. You need a host PC of a reasonably contemporary vintage running a reasonably contemporary version of Windows. That’s it.

Fire up Windows and you get a completely virtualized version of the clinical workstation running on the host using the host’s memory and CPU, but no other aspect of the host software, If you use a VPN, we use that. The user clicks on an icon, it runs in a window and looks exactly like the application in a hospital. They provide their logon credentials and everything is identical. Radiologists can manipulate their images exactly like in the office without the remote delays. There’s no training involved, no new portal, and no additional expenses for standing up servers to host WTS or Citrix. It’s all running on native client hardware.

We introduced vThere in the middle of 2006. Use ranges from physician access to their full cadre of clinical applications to medical coders who work at home, who have increasing clout because they stand between the hospital and reimbursement. Hospitals are increasingly willing to accommodate a work-life balance for coders. Customers are doing that with IT, too, allowing them to work from home two or three days a week. How can you provide with them their usual applications? Our vThere product is a practical, elegant, and cost-effective solution.

Proximity-based security and biometrics always seemed ideal for healthcare. Are they, and how well are they selling?

We have extensive implementations of proximity and biometrics, primarily in the US. Less so in Canada and in the UK, which has a different model where NHS has mandated the use of smart cards. The combination of active proximity and biometrics is very powerful. You can achieve touchless logon. You walk up to a workstation, your identity is provided to an active proximity device, and you are then authenticated by fingerprint. With Vergence, our flagship product, we can not only log you on, but automatically launch your applications based on your role, and then single sign you onto those applications. The first thing you need to do is select a patient – we can’t read minds yet. [laughs] It’s very powerful. Customers are using the technologies separately as well.

We introduced in the latest version of Vergence a variation on the strong authentication theme using passive proximity devices and an Enterprise Grace Period. Most healthcare environments are reasonably physically secure. You can have flexibility in how you apply authentication to users during the day. The user, at the beginning of their grace period, swipes a proximity card, authenticates by password, and does their business. The next time they need to log on, during the grace period defined by the organization, they only need to swipe their smart card. Possession of the smart card within the grace period tells us it’s that user. Those seven or eight character strokes done 50 to 100 per day times add up. It allows organizations to find the right balance between strong authentication and caregiver convenience.

How does expreSSO change the single sign-on equation for healthcare customers and for Sentillion?

The biggest challenge that customers have with anybody’s single sign-on always centers around connecting with the application. Often, a vendor walks into a sales situation, tries to impress on the customer how easy their tools make it, and shows a live demo. They’ve thought through the applications to impress how easy it is. For more complicated applications, or those developed in-house with less optimal programming, what seems so easy in the sales call is much harder.

We’ve taken everything we’ve learned to make it easier to deploy. The next generation of tooling accompanies expreSSO. A wizard allows organizations to create incredibly sophisticated connectors without having to write code. If you think about a process of creating a connector for signing on and off and dealing with other sign-on related events, you’re navigating through a series of screens and either inputting information on behalf of the users or accepting information like a password expiration message. The trick is to satisfy the application by putting in the right information at the right time while responding to the information needed.

We looked at metaphors that would be easy for people to understand. We decided to use editing a movie. Movies have frames, they flow in a sequence, and you can insert special affects. We take a movie metaphor and apply it to the process of having a user generate a connector to a target application. We show screens in the order they want them to appear and define inputs based on visual controls that they point and click through — for a logon, logoff, or password expiration message, each representing the application as it appears at a certain point in time.

Anybody that’s used iMovie or Microsoft’s movie maker would instantly get how the expreSSO wizard makes connectors for applications. My wife recently edited videos of my son, who’s a competitive fencer. Colleges wanted 15 minutes of video. My wife went through hours of movies, having a great time with iMovie creating effects. She’s not a movie director, and had never used iMovie before, but she was still able to use a tool to do very powerful things.r That’s what expreSSO is all about.

The press release mentions cost savings.

Vergence does an awfully lot more than single sign-on – patient selection, auditing, and role-based access. Vergence is really a platform for creating a complete clinical workstation. It’s always been that, but in the early days, it was too broad for people to understand that, so we positioned it as a single sign-on solution. It’s like saying a car is an air conditioner when it’s more than that, like an entertainment system and transportation.

expreSSO does one thing really well and cost effectively – signing on and signing off. Customers increasingly want to focus on that to start and that’s what expreSSO is meant to solve really, really, well. When they’re ready for a more comprehensive solution, they can upgrade to Vergence.

You’ve had some recent organizational changes, I’ve heard. What’s going on at Sentillion?

We made some changes back in June that were mainly centered around refocusing the company on healthcare. We had started a process with vThere in broadening our footprint beyond healthcare in a thoughtful way. We created a business unit inside of Sentillion to look at opportunities outside of healthcare so the bulk of the company could stick with healthcare.

It’s difficult for a $30 million company to do as many things as we were trying to do. We were diversifying into the UK, bringing vThere and expreSSO to market, and trying to establish a foothold for vThere outside of healthcare. It was one vector too many. I decided we needed to reconsider expanding outside of healthcare, or at least let it be opportunistic and let companies find us. We had hired people without the healthcare background because we didn’t need that.

We’ve just come off a terrific Q3, the first full quarter since the change. We signed six new customers and sold a bunch of products to existing customers. It was a good thing to do and we did it thoughtfully for our customers and employees.

What do you like most and least about being a CEO?

I thought I would miss writing code. My expertise is in distributed, object-oriented programming. How’s that for a mouthful? [laughs] I really don’t miss it. I find what I really enjoy is the challenge of doing things that others haven’t done before.

People often ask me about what I do other than work. I have a car that I’ve been building for years. I drag race it. It’s a combination of parts that have never been put together, which means I make a lot of mistakes. I fine tune my problem solving skills and persistence. The thing I love most is to see what others here are able to accomplish that I have nothing to do with. It’s intensely satisfying. It happens following ethical principles that we care about and a corporate style that I care about, but I had nothing to do with it.

What I like least is the set of arcane accounting rules that govern software revenue recognition. It’s a set of principles defined by accounting boards that software companies need to follow to book revenue on an annual or quarterly basis. The rules are complex, but accounting rules don’t have that foundation of reason. It’s kind of like laws that evolved over the years. You can spend an inordinate amount of time interpreting the rules so you do the right thing. I’m not always sure that time is effective for the business or customers, other than you want to do the right thing.

Who do you admire in the industry?

The people that I admire most are in the new generation of CIOs, probably in their late 30s or early 40s, who grew up with information technology instead of having it happen around them. They have business savvy as well. The combination of a comfort with IT and business savvy are impressive.

Mark Hopkins at UPMC is one such person. Steve Hess of Christiana Care, Praveen Chophra at Childrens Healthcare of Atlanta, Allana Cummings of Children’s Omaha, and Marianne James of Children’s Cincinnati. All of these are examples of healthcare CIOs who have a comfort with technology and business acumen. They are putting it to formidable use in their organizations.

I gave a lecture at HIMSS about the healthcare tipping point, referencing Malcolm Gladwell’s book. One of the required ingredients is people like this to make it happen. If healthcare IT becomes truly pervasive in the next five years, it will be because of people like this.

Thanks for sponsoring HIStalk, by the way.

What was most fun about sponsoring your blog is that we all reading it already. It was a Homer Simpson Doh! moment. The best endorsement is that we didn’t just hear about it and decided to sponsor. Just like we use our product, we were already reading your blog.

A Report from the Cerner Health Conference

October 8, 2007 Interviews 2 Comments

KC convention center

The Cerner Health Conference kicked off Sunday at the Kansas City Convention Center. Don Trigg, Cerner’s chief marketing officer, offered to connect me with some attendees for a report. (I should note that, despite my occasional criticisms of Cerner, Don has always been a straight shooter, has invited me to Cerner events, and offered to connect me with sources there, all in a casual, non-official way, which I appreciate).

My guests for this live update were Helen Thompson, CIO of Heartland Health of St. Joseph, MO; Reid Conant, MD, CMIO of Tri-City Emergency Medical Group of Oceanside, CA; and Stephanie Mills, MD, CMIO and CIO of Franciscan Missionaries of Our Lady Health System of Baton Rouge, LA. I’m sure they were ready to relax after a long day of conference education, so I appreciate their voluntarily taking time to speak with me.

What’s your impression of the conference so far?

Reid: It’s been very productive sessions so far. I gave two talks today and will be on a panel on Wednesday. I sat in on a few sessions and shared ideas with my colleagues. The setup of the CHC is kind of neat – it’s primarily client-driven educational sessions. The overwhelming majority of sessions are either entirely client-presented or have a panel with Cerner people and other clients. It’s sharing of ideas. It was in Orlando for a few years, now it’s back in Kansas City. It’s a very productive way of sharing ideas among clients. We’re using many of the same applications. You can always learn something from someone else who’s using what you are in a different way.

Helen: The networking that we get from this event, as well as the strategic look at what’s next on the agenda, makes this an extremely valuable conference.

Stephanie: It’s been very interesting to watch healthcare IT over the past several years. I’ve seen us as clinicians become more engaged, more involved, and more committed to developing solutions for quality and patient safety challenges. It’s a group of colleagues with the same experiences, tools and challenges. It’s important to get together in a safe environment and collaborate. It’s amazing what comes out. It breaks down a lot of the barriers.

How would you compare the value you get from attending Cerner’s conference to other conferences like HIMSS?

Helen: We’re just 45 minutes north of Kansas City, so the location factors in. We have an opportunity to do much more focused sharing and learning from one another. HIMSS has such a broad range that it makes it difficult to do this level of collaboration.

Stephanie: It’s practical, with stories from other organizations. Very practically oriented. HIMSS tends to be more theoretical, which is also good. You need both sides of the coin. In the trenches, to know what is or isn’t working.

Reid: Being in Kansas City, there’s been an even larger presence of Cerner associates. That’s done a few things. It’s gotten them more involved and given them a view of what clinical medicine is. I heard from a few of them that that is encouraging to them as they’re working on code. For us, it allows us to give them direct feedback. That’s very important and they seem to listen. I’ve been on an ED solution advisory group for years and they take direct feedback on specific issues. Today in one of my talks, I spoke about using scribes with PowerNote. Cerner has electronic, template-based charting. To augment productivity, we use undergraduate students to assist the physician in creating that document. That electronic record gives them the tool. After this talk, an engineer came up and said, “We liked what you did with that column. It fits with our code.” They want to put it in the product. These guys will listen and the next service pack will often have those kinds of suggestions in them. That reception of ideas is valuable.

Stephanie: Team members were here and some of the Cerner documentation team were dealing with some challenges that’s been difficult to diagnose, working over phone and conference calls and sending log files back and forth. We got in the room, got on the system, and had both teams together. To be able to share those experiences is really valuable, to have direct access to a vendor and share that knowledge and experience and frustration – it really gets folks bought in to finding the solution. We build relations with people, not just a voice over the phone.

Reid: It makes them accountable on a personal level.

Helen: It makes us accountable, too, because we share feedback with them. The success of our organization is tied to the success of this application. It’s very much a two-way learning street. They learn so much from us while we’re down here presenting and we learn from them as the dialog is opened.

Have there been any big announcements or revelations so far?

Reid: This morning, Neal Patterson said something that I felt was impressive. Cerner has taken a stand as an organization and said, “We are going to focus on the current code level.” In this day and age of rushing to get the next release out, they said they’ll focus on 2007 code and put all of the innovation into that code level. They’re going to, for the rest of this decade, ride that code level and make it the best they can, as solid as they can, before moving to a major change to the architecture of the code, incorporating Java and so forth. Thankfully, they recognized that ahead of time. I appreciate that.

Stephanie: We’ve had keynote addresses, discussion about health policy, the future of healthcare, how technology can come to the table in a number of ways. Then, lots of sessions in different areas that focus on a combination of presentations from clients in the trenches and living this, and also some sessions from the Cerner team about what’s going on today in problem solving and development.

Helen: The conference is broken down into a series of tracks to select from. Some are application-specific, some are role-specific. There’s quite a broad range.

You mentioned code levels. Millennium’s Achilles heel for years seemed to be response time, with a rumor that the entire application would have to be scrapped and sent off to India for a rewrite. Was that mentioned and are you seeing performance issues?

Reid: When went live 3 1/2 years ago, we felt some of that. We’ve been remote-hosted since go-live. Some places that tried to do it on their own felt that impact. They had more delays then than now. ED is one of the fastest paced environments. Anything short of sub-second response time won’t cut it and I won’t hesitate to call them for a four-second delay. That’s just not an issue any more. We’re using CPOE with meds and every order I enter is through the system. I can enter 20 to 30 orders on a complex patient in 15 seconds, using order sets and other tools. There are lots of clicks. If response time is not immediate, I feel it and they hear about it. What Cerner highlighted today is the Lights On Network, a Web-based application that allows you to drill down to an institutional and user level on response times. They track some huge number of the most common and most important actions. They track each and every one, so you can literally drill down to Dr. Mitchell if he’s complaining and say, “We saw at 2:55 pm you had one delayed action, but other than that, it’s been sub-second.” You can also pull out by department, not just response times, but how they’re using it, like ignoring alerts.

Helen: We’re a client-hosted solution and Lights On Network user for over a year. We’re very pleased with system performance improvements that Cerner continues to develop from data they get from Lights On.

Stephanie: I agree. We’ve been quick to look for a quick fix for our healthcare woes and sometimes fall prey to technology seduction. We want the magic Band-Aid. At the same time, we’re quick to blame when the magic fix doesn’t solve the problem. You can’t do that in a vacuum. When you look at performance, we have a lot of challenges that can be pointed at a particular vendor or application. We’re maturing as an industry in applying best practices like ITIL. For leaders in healthcare IT, it’s important to have a comprehensive perspective and make sure our organization is optimized to provide quality of care and to apply technology. It’s about people and processes and workflow and not just automating a process.

Helen: We need to think back. When we had a paper record and a very ill patient and the chart got larger, it took longer to filter through that information. The more data we collect, it will be a more constant process to keep sub-second response.

Reid: One real strength of Millennium is integration, like accessing old records. If the patient rolls into the ED by ambulance, with a couple of identifiers I can pull up the record from visits three days or three years ago. The ED course is immediately accessible to the nurse in the ICU. For hospitalists, it’s worth it to get out of bed and get online. They can look at orders and tests.

Stephanie: It really does change the way we pratice completely.

Are you glad the conference moved to Kansas City?

Stephanie: It’s helpful for the reasons we mentioned, access to team members and architects and engineers and folks here behind the scenes that we don’t get to build a face-to-face relationship with. Orlando is a very big conference town and its nice to bring it to Kansas City.

Reid: It’s a busy week, too busy to bring the family to Disney World, so we get much more out of having it here.

Are you planning to check out any particular Cerner products?

Stephanie: We’re an integrated Cerner site using a lot of the solutions. We’re going through a reorganization of Information Services. The next step is to optimize what we have, dialing things back, looking at current state, looking at workflow. The next piece that we already own but haven’t implemented is Power Insight, which has clinical and operational dashboarding.

Helen: We’re optimizing the solutions, also looking at the Care Aware product, leveraging the application to move to a digital environment.

Reid: Care Aware is on the horizon. It was demonstrated this morning at the kickoff. In the ICU setting, where they’ve had antiquated paper flowsheets with graphs four by six feet double sided [laughs] someone goes in there with a pencil and traces the latest vitals on that graph. How antiquated is that? But it was one of the most useful tools. If I go to a code, that’s one the first things I look at. Care Aware is a centralized reporting tool and repository for acute care patients. Many of us were salivating at the demonstration. It uses a larger screen, maybe a 20-inch monitor, with an image of the latest chest X-ray, vitals, etc. It’s highly customizable at the user level. It asists you in decision-making, changes in plan. It appears that it will be an invaluable tool.

Stephanie: It will be great. It’s been fun to see this in development. In Louisiana, we have problems with access to care. We can leverage what we have outside of our walls to create a virtual critical care environment that’s more automated. We’ve been saying, “You have to be able to tell the story and have that snapshot in a comprehensive view.” Our Lady of the Lake has created our version using Cerner tools, but it’s pieces and parts and not quite as seamless. To be able to see that pulled together and configurable is certainly where the future is.

Reid: It takes something like the tracking board in the ED, the FirstNet application. The tracking board is highly customizable, data-rich, and drives processs improvement. It’s a very powerful tool. At a glance, you can see exactly what’s happening with each patient, what’s pending and what’s back. It’s a matter of getting as much data in an organized fashion right there in front of the provider.

What would you say has changed most dramatically about Cerner in the last couple of years?

Stephanie: I’ve seen consistent dedication to partnership, to collaboration from Neal Patterson down, a true interest in what’s going on and how Cerner can impact that. I think it’s authentic, it’s genuine. When the Cerner brass comes to visit your hospital, they’re out there and want to know what’s going on. They’re continuing to march the ball forward in that arena. We need all the help we can get in healthcare, to have companies that are truly committed. We’re all in this together. To feel that we’re able to collaborate with our colleagues and vendor partners in a meaningful fashion and with the patient as our primary responsibility – what more can you ask for? We’re continuing to see clinician involvement on the Cerner side. That’s promising. They’re taking a smart approach to technology, applying it where it makes sense, and not just trying to get the latest whiz-bang out.

Reid: An example of that is the organizational decision to take a step back and not advance to the next code immediately. That’s organizational maturity. There’s always the risk of misperception of what that means. I don’t think it’s a negative indicator. It just shows that, when they roll out the next code, that they want it to be a dramatic step up. Where we already are is phenomenal. Look at the curves on the Lights On Network and graph performance over the last year or two. You can see a very steady and fairly steep drop in response times, now to the point where it’s not an issue.

HIStalk Interviews The PACS Designer

September 26, 2007 Interviews 2 Comments

Hardly an HIStalk posting goes by without an insightful commentary by The PACS Designer. TPD always seems to be up to speed on various emerging technologies, particularly in the PACS world. I was curious to learn what made him tick and was able to have a chat with him recently. Thank, TPD, for sharing your story.

Inga:  How did you select the name The PACS Designer?

TPD:  Since I have been working in the medical field for years and designed a PACS system in the mid-90s with some great partners, I thought, why not use the name as a blogger? I am also trying to promote PACs. Shahid Shah encouraged me to blog. I am an electronics engineer and wasn’t really working in the PACS area but found an opportunity. I got to like what I was doing and some good things happened out of it.

When did you first begin reading and posting on HIStalk?

I first started about two years ago, when Shahid Shah from Shahid’s Perspectives and creator of HITsphere told me about it. I decided to get involved with blogging. I love teaching people. In my prior job, I taught courses in PACS and other medical technologies and even did SAP software teaching.

What was it about HIStalk that interested you?

I thought the style was good, because sometimes you see blogs where the posts are very infrequent. But HIStalk had the right formula to get people to respond to the posts in the Web 2.0 sense. It promotes 2.0 through interaction. Bloggers are becoming an important part of society, as everybody knows.

What about your background has made you an expert in HIT in general and PACS specifically?

I worked with PACS behind the scenes in design. Before that, I was a purchasing manager and I always knew the latest technology. The combination of purchase evaluation decisions and designing helped me, development-wise.

I love technology. It is a small point, but in 1958 my mother bought me a transistor radio that came from Japan, made by Matshushita, now better known as Panasonic. I got so fascinated with the transistor radio that I decided to go into an electronics engineering program. I’ve been an electronics buff ever since. It is really becoming a digitally connected world and that is where healthcare needs to be.

So, what really got me into PACs goes back to the 1980s, when hospitals were using telephone technology with PACs and it was a very slow teleradiology. In the late 1980s, a company my employer partnered with discontinued their product line, so it killed our product line. I was looking for ideas for the next version of PACs and eventually hooked up with a company to design the next generation of radiology PACs.

What did you do after helping to design the radiology PACs systems?

I looked at how we could help cardiology. I designed a cardiology PACS that has had good success and is used all over the world. I am proud of both things, the radiology and cardiology products, but I am proud that the cardiology images in the cardiology PACS I designed can be viewed all over the world with the PACS I designed.

What do you do professionally today?

Today I am an independent healthcare software developer, working with major universities and vendors on the next generation of software.

PACS software?

Not just for PACS, but Web-enabled software solutions that are available by accessing a Web browser. No software is loaded on your PC. It’s downloaded to you just like YouTube is. Healthcare is going to see a lot more of that technique in the next 10 years.

So you are hired by the different universities to develop applications? 

Yes, to do integration of DICOM, HL7, and Java technologies to create Web-based solutions for healthcare.

Do you find your current job rewarding? Fulfilling?

I love delighting my customers and really like innovation and like to pursue it with excellent partners that will make customers happy with the end result. I will be starting a major project with a Top 10 university next month. 2007 is turning out to be a transition year for technology that is going to excite end users.

I am also a member of the ASTM International. I’m a member of the E31 Health Informatics Committee that developed the Continuity of Care Record. The E31 Committee that created the CCR used the Massachusetts Patient Care Record that had been used for many years as the basis for the CCR. I am still on the committee and another health informatics committee called Privilege Management Infrastructure to design enhanced security for HIPAA so users only see information that they’re entitled to see.

HIPAA is great, but there is a lot of structure out there that needs improvement, security-wise. The ASTM PMI standard will be coming out within the next year or so.

Do you actually meet with your fellow ASTM members?

We work remotely, but I get all my information sent to me over the Internet. I approve or disapprove information online. It is very interactive, but it is all done remotely. They do meet in person, but I’m very busy and don’t have the time and funds to travel all over the place.

I believe I have noticed that you have posted on other blogs.

I randomly contribute to others.  Do you want to know some of the other blogs I read and post on?

Sure!

The Healthcare IT Guy, Shahid Shah. He got me started. LabSoft News. Dr. Friedman is very good at presenting concepts and I like his highlighting techniques. Dalai’s PACS Blog. He is a radiologist who is a very good blogger. Candid CIO. Will Weider lets us know what’s happening in the real world of healthcare IT, which I enjoy reading, and then I post comments on his blog to educate his readers. Scott Shreeve, MD. I also like Scott’s blog and we’ve seen his HIStalk interview and the numerous posts about him. Christina’s Considerations. Christina is not as well known yet, but she covers RHIOs, a controversial subject today. HealthBlog from Dr. Bill Crounse at Microsoft. He tries to let us know what Microsoft is focusing on next, like Azyxxi.

HIStalk is the best one, right? [laughs]

Of course! Actually, HIStalk is more consistent about their format. There is a lot of interaction with readers. There is Inga, Tim, and other posters, I was so happy when you joined. It made it better.

Thanks. Well, there are some amazing posters. Next question, how is the PACS world going to change over the next few years? What companies will survive and what will the hot technology be?

PACS is becoming a vital modality as far as hospitals are concerned. PACS takes away the cost of X-ray films, which is a very expensive thing. And PACS is expanding to include a mini-EMR through HL7 interfacing techniques and open software solutions.

Everything is going digital. The patients are becoming more involved. Here is a new term – Digitally Connected Patients (DCP). The patients from home will be able to be wirelessly monitored by the hospital. That will be the next big wave over the next 10 years. Patients who live alone with health problems would definitely want to be connected. We’ll actually see that in less than five years. We already have the ability to send heart rate, blood pressure, and other vitals information from remote locations, such as ambulances in route to emergency departments, and also remote digital storage for redundancy.

The infrastructure of companies will change a lot. With EMR companies, they will be bought up or go out of business because everything is going to be Web-enabled. If you are not Web-enabled, you won’t survive. The EMR and PHR will be a partnership involving the patient, hospital, and doctors all submitting information into the combined record. It will be Web-based and a lot of the EMR companies will need to change their business plans to go Web-based, or go out of business, or merge with larger companies.

EMR/PHR will be viewed similar to having an online bank account. You can call up your account any time as long as you have an ID and password. If you can do it in banking, why not do it in medical?

I didn’t mention this earlier, but XML, Extensible Markup Language, will become a big part of how we capture information. Any time you enter information via a Web browser, you can capture it in XML and store it in an EMR or PHR. Currently I can’t talk much more about this because I am in the middle of a patent application. I have developed a new technique for this.

2007 is becoming a year of major transition because a lot of things are happening and it is exciting for the healthcare field.

You have been in this business a long time. Any plans to retire soon?

I love the healthcare field so much that I plan to do software development as long as I can, no matter how old I am. I am not inclined to retire in the immediate future. I love being independent. I have a great group of partners ready to work with me. Being free and independent lets me innovate the way I want to innovate.

Thank you for interviewing me. Hopefully HIStalk readers will enjoy some of my comments and I hope readers will benefit from them in the coming years.

HIStalk Interviews Eric Fishman MD, President, EHRConsultant

September 24, 2007 Interviews 1 Comment

efishman

I ran across Eric Fishman, MD a few months back when I stumbled onto his EHR Scope, a compendium of information about physician system and speech recognition. Ambulatory systems continue to be very hot in the marketplace and it was interesting to find a practicing physician who was putting so much time and expertise into that market.

Since then, Eric has decided to put his full time and attention into his business, which also includes a free service to help physicians choose an EMR/EHR and a package of products and services related to speech recognition for physicians (based around Dragon NaturallySpeaking). Note: I’ll mention as a disclaimer that Eric’s company recently decided to sponsor HIStalk, although our plans for the interview had already been made by then.

Thanks to Eric for bringing me up to speed on the complex world of physician practice systems. Big changes are happening.

Give me some background on yourself, the company, and how you got interested in physician automation.

I’m an orthopedic surgeon. About 14 years ago, one of my secretaries came to my office and said, “I know you like computers. I just took my son to a pediatrician and he was talking to a computer.” He was using a voice recognition product from a company called Kurzweil, which had been started by Ray Kurzweil.

I decided to buy it. Ours was a three-physician office at the time. The $26,000 cost was hard to swallow, so I opened a company to sell voice recognition software 13 years ago. And so the rest is history, although I didn’t want to say that because it sounds overly grandiose. [laughs]

I always refuse to use the term EHR since vendors started using that name in talking about their old EMR products without changing anything. Am I being too much of a stickler?

Yes. I have a treadmill in my garage with a wireless mouse and keyboard and I do a lot of Internet surfing. I don’t call it by the time, but rather by the mile. When I surf, I can do five miles.

John Naisbitt is the author of Future Trends. He made the rational conclusion that what is important to the present and what will be important in the future can be measured by how often items come up in newspapers. I compared “electronic medical record” and “electronic health record” to see how often they showed up in Google. I wrote in an article that the term “electronic medical record” would have become less prevalent when the lines met. Right now, “electronic medical record” is 46 million in change in Google hits and “electronic health record” is 71 million. Three years ago, it was exactly the opposite.

There are subtle distinctions. An EMR is used by a physician in the office to take care of patients. An EHR is more connected and takes care of the community. Connectivity is the distinguisher.

The manufacturer calling it so doesn’t make it so. The terms are very frequently interchanged. I changed the name of my company from EMR Consultant to EHR Consultant in recognition of that change, although you’ll see Word changing EHR to HER. [laughs] In EHR Scope, we talk about how Microsoft Word versions can be corrected to stop doing that.

Notwithstanding all the above, I frequently use the terms interchangeably.

What’s holding back widespread adoption of practice automation?

It’s a few basic issues. Physicians are the ones who pay for it, both with cash and, more importantly, blood, sweat, and tears from the angst of changing how the office functions. Third parties are the ones that benefit, like government and patients. That disequilibrium is disconcerting to many physicians.

I’m a strong proponent of using voice recognition. It substantially minimizes the inconvenience of electronic recordkeeping. It allows physicians to alter the way they interact with patients to a lesser extent.

Despite the significant amount of time and cost, essentially every physician who has been involved with a successful implementation says they would never go back to a paper office, myself included.

I saw recently that a physician insurer is offering a discount for EMR users. Is that common and will that benefit be attractive to fence-sitters?

I believe it’s common. It’s probably not a sufficient amount of money to pay for the software, but it could be meaningful. I was pushing that idea in 1994 with insurance companies to use Kurzweil and structured reporting systems. Physicians who prove they can provide greater quality of care will not only have greater gross revenue due to pay-for-performance, but will also be offered more meaningful malpractice insurance discounts.

Can a one or two physician practice implement a good EMR with reasonable cost and effort?

You used the term EMR either intentionally or not, so I’ll speak to an EMR specifically. Yes. But, you can’t implement a state-of-the-art, easily interconnected EHR with all the bells and whistles and billing capabilities for $5,000. However, if you want to take a substantial step in the right direction and automate reports, absolutely. In fact, a number of those systems are CCHIT-certified, surprisingly.

Speaking of CCHIT, is it accomplishing what it was intended to accomplish?

I’m not positive that I know what it was supposed to do. I feel badly about specialty-specific programs that were not offered the opportunity to be CCHIT-certified. If you wrote a state-of-the-art, phenomenal program for OB-GYN or ophthalmology, you won’t be certified because you don’t have the features they require. Certainly that will change.

I’ve heard scuttlebutt about the $28,000 certification fee and the hundreds of thousands of dollars needed to bring products up to CCHIT specs and whether that has caused a material increase in the cost of software. It probably does weed out some of the mom and pop operations.

I spent a substantial about of time and money developing what I called an EMR that was more of a documentation product. I stopped developing it about three years ago, so I can feel the pain of someone who spent years to develop software that helps people accomplish what they need to in their specialty, but because of CCHIT certification, may be put out of business. Over time, under-funded companies will go out of business.

If its purpose was to give comfort to physicians buying software or to make it easier, I’m not sure it accomplished that. I’m not seeing it. One of the bits of data I maintain from people going to EHR Consultant and telling us what they’re looking for is whether they want a product that is CCHIT-certified. Maybe 20% of our clients say they won’t look at non-CCHIT certified programs. That means that 80% will. Many say it’s of no consequence to them. Smaller offices seem to care less and larger offices care more, but that’s a subtle trend.

You offer a free EMR evaluation service. How does that work and are other companies offering something similar?

I went to HIMSS 3½ years ago and rapidly realized that most mortal human beings would be incapable of learning about the wide variety of programs in order to support them, which is what is consultants do. I decided to do an evaluation. I devised a vendor questionnaire of 600 questions and then asked doctors 200 to 300 questions.

If you look up electronic medical records on Google, a surprisingly large number of responses are from companies that will gladly help you find the proper EMR. My experience is that many of them ask name, address, phone number, number of docs, when purchasing, and not much else. They’ll say, “Here are the top five products.”

Our methodology is that there are dozens of qualified products and not all are appropriate for an individual office. There are a number of cars, Mercedes and BMW, all of which have different styles in the marketplace.

By matching the 200 to 300 questions the physician has answered against the 660 the manufacturer has answered, we can make a qualified match of the appropriate technology. It’s a matter of judgment, but we give large positive grading for EMRs designed specifically for one specialty for somebody of that specialty. In that way, we’re best able to give a good number of very appropriate software program recommendations to each individual physician.

Is speech recognition software underrated in its ability to help physicians save time?

Absolutely. I’ve been doing it and selling it for 13 years. You’re not supposed to take returns of open software, but if someone returned it, I took it back. In 1994 to 1995, I had a 50% return rate. Nobody asks me to take it back any more. You get 99% accuracy. You can speak like a New Yorker. It’s like transcription with no fees.

The sweet spot is a rich EHR. I can click through the physician exam, click through the review of systems and family history, and social history. I dictate the history – how the accident happened, what restaurant they were at when they started choking. The specific factors that make each individual’s history unique are important. Speak those first two paragraphs. Minimize the transcription cost and let the EHR do what it’s supposed to do, which is get good data capture.

I have some confidential information as a distributor. It used to be a meaningful event when a medical group would buy five or 10 Dragon licenses. With increasing frequency, we’re quoting and selling 100- and 500-license opportunities. If somebody bought 10 licenses, then 50, by the time they’re buying 500, they know it works.

What’s the penetration of speech recognition in practices?

Tens of thousands of physicians use Dragon NaturallySpeaking. That’s probably still single-digit percentages, but it’s increasingly rapidly. I have no visibility into the market of companies not selling Dragon NaturallySpeaking. They’re clearly the market leader, but I don’t know the percentages of the others.

We’re a distributor, so we sell to 100 Nuance-certified solutions providers. At the present time, I’m doing an ambitious project, which is finding out from each reseller which EMR packages they’ve installed Dragon with. I’m putting together a series of Google Maps. I can point them to a page on the Web that will have a map point for each qualified, certified Dragon reseller that has experience with their particular EMR program.

I just sent an Excel worksheet to 160 resellers with 362 EMRs listed down the left hand side and a dozen different qualifications across the top: have they used it, have they developed macros, do they help install it, etc. We’ll tabulate that onto Web pages to display that data.

What do you think about AcerMed’s situation?

As I understand it, there was an intellectual property infringement lawsuit that led to substantial legal fees. That was the immediate cause of the demise of AcerMed, not the fact that the program didn’t work. I’ve spoken to people who liked it and people who didn’t.

Functionality didn’t lead to AcerMed’s demise. I don’t believe that CCHIT is in the business of looking at the financial aspects of companies.

Will that event change how doctors look at software?

If you’re a single doctor spending $10,000 or $15,000 on software, I don’t think you need to pull out all the stops. Larger installations spending hundreds of thousands should get financial information and do a Dun and Bradstreet or Hoover’s check.

What changes would you predict in the physician office system market over the next 3-5 years?

There will come a time where a specialist is no longer getting referrals from their general MD because that doctor has an interoperable software program with the specialist across town. When that happens, you’ll see rapid adoption because they’ll need to stay competitive.

You’ll see greater use of non-MDs putting medical information into the history, either the patient or less highly paid people to enter the data, whether a physician assistant or nurse practitioner or medical assistant. I think that’s an inappropriate use of an MD’s time. They should be spending their time diagnosing people. It can be a substantial change of physician time to document an encounter and I think it will be attacked in different waysE

The EMR industry seems to be polarizing, with legacy, expensive vendors on one end and modern, inexpensive products on the other. How will that shake out?

That’s absolutely an accurate depiction. I am somewhat surprised, and I’m not politician, but hospitals are permitted to pay 85% of software costs that are compatible with hospital legacy systems. I was expecting to see a sea of change where legacy systems would run over these new companies. I haven’t seen the new companies being quashed like I expected.

What does that mean?

New companies that are selling 10, 20, 50 million dollars of software a year in to medium and increasingly larger practices have a very bright and rosy future. As I think should be self-evident, I do analysis for physicians for free, but I have some referral agreements with a very few vendors. I’ve been doing this for 3½ years and I used to get an intermittent check from these companies for sales to a one -or two-physician practice. Now I’m seeing small companies selling to 10-, 20-, or 100-physician practices.

Are they taking away business from the legacy vendors or selling to first-time customers?

In 2010, they’ll be taking their business away. I don’t think that the current sales being made in physician offices for a few thousand dollars would have been made for $75,000 if the smaller companies weren’t there. Those sales would not have been made.

If I were a large public company with product installed in hospitals, I’d rapidly provide an inexpensive offering to the local physicians to stay competitive.

So you like the Misys-iMedica deal, where Misys will resell the small vendor’s product instead of developing their own so they can get to market faster?

From Misys’s perspective, it was the proper thing to do. I have the pleasure of having thousands of offices telling me what they like or don’t like. Misys will likely benefit from having a new, up and coming, recently written, capable software program. They’re a billion-dollar company with long marketing reach and having a product that physicians are happy to use will be a welcome opportunity for them.

Will the smaller vendors be bought by the larger ones who worry about the competition?

I don’t think big companies will buy them because they’re a threat. They will buy them because they provide an opportunity.

I live in the same county that Dr. Notes was headquartered in. I was appointed by the bankruptcy court to sell the company’s source code to its .NET version. They had a Windows-based program and were allegedly 90 days away from shipping a .NET program. They went into bankruptcy and I’m helping sell the 400,000 lines of code.

I sent 360 e-mails at 9:00. By 9:01, I started getting responses. People from the up-and-coming companies wanted to buy the code. They wanted a billing module, which Dr. Notes didn’t have, or wanted their customers, or wanted their code.

Then, I noticed that the people calling me were saying things like, “Well, Dr. Fishman, since you seem to be in the business of buying companies, can you find someone to buy mine?” That happened dozens of times. Others said it wasn’t exactly what they wanted, but wanted to hire me to find them an ASP CCHIT product within 30 days.

There will be a lot of churning of these 1, 2, and 5 million dollar companies in the near future. That’s a particular interest of mine. In next EHR Scope, we have half a dozen pages about recent transactions written by an investment banking firm.

Was it a surprise that McKesson bought Practice Partner?

Andy Ury did a great job having a company of McKesson’s stature helping them do the marketing. I don’t have any insights into McKesson. The phenomenon of having billion-dollar companies snapping up EMR companies with eight-figure revenue will continue.

Do doctors like the idea of personal health records?

I don’t think it’s happening in doctors’ offices. Companies are interested.

I’m potentially involved with a PHR company and a clinical practice guidelines company interested in getting more entrenched into the personal health records. I think it’s something that will be very important and I’m surprised it hasn’t taken off more quickly. I stopped practicing 3 1/2 months ago and had zero patients express interest in interacting with me in that way. It’s not happening yet.

What about Google Health’s rumored PHR project?

It amazes me what Google knows. I think if they set their mind to it, they will do it. I understand they had some change in staffing at that level. I’m not qualified to offer an opinion as to whether they will or won’t do it, but I spend money advertising on Google and thinking about their algorithms and how much they know about people.

They certainly have the computing power to enter this space and pharmaceutical companies spend tens of billions of dollars in advertising their products. Google would certainly be willing to accept some of that.

A magazine just released its 100 Most Powerful healthcare people. If someone asked you, “Who are the most powerful and influential people when it comes to physician use of software,” who would you say?

The CEOs of those dozen up-and-coming EMR companies that I refuse to name. [laughs] They are involved in determining what the software that they’re producing will look like. They are profitable companies with millions or tens of millions of dollars of free cash flows without the shackles of having it burdened to something from their past.

They will decide whether to encourage or discourage interaction with patients, like personal health records or smart cards or thumb drives. They have the resources and knowledge and motivation to be in the doctors’ examining rooms around the country showing how healthcare will be delivered. They have the wherewithal to acquire technology, like clinical practice guideline technology, and integrate it in their software.

I know a little about nanotechnology. A friend asked me where to buy a portfolio of nanotechnology stocks, but they’re mostly privately held. If I could invest in a portfolio of smaller EMR companies, I’d do it in a heartbeat. You could reasonably choose a handful that will be successful, though I can’t pick them all, but the small ambulatory EMR industry will do very well financially.

My specialty is the smaller office, but two weeks ago, I got call from hospital CIO with 525 physicians on staff. He mentioned two legacy EMR systems they were interested in. I mentioned a couple of smaller systems and there appears to be some interest. Some of these up-and-coming players may play a role in hospitals

What about retail medicine?

I don’t want to grow old and decrepit in this country because healthcare won’t be as good as it is today. Retail healthcare is here to stay. Healthcare should be touching and care, but it’s clear that retail clinics aren’t going away any time soon. I don’t get my care at one.

Will retailers develop their own software or buy from those sexy companies?

I have made successful introductions between retail pilots and one or more of those dozen hot, sexy companies I won’t name. I don’t mean to be evasive, but I have relationship with those companies.

If an HIStalk reader is interested in ambulatory EMRs, what information do you provide?

EHR Scope is a free publication, over 150 pages, and the next issue is in October. It has a meaningful amount of information on over 200 ambulatory products. It comes out in a PDF and if somebody’s a cardiologist, they can search cardiology and find systems appropriate for them. They can quickly get their Web sites and contact information. I think it’s a very valuable resource. The electronic version is free.

Any final thoughts?

I love what I’m doing.

HIStalk Interviews Daniel Sands MD, Cisco Systems and Harvard Medical School

September 19, 2007 Interviews 1 Comment

dsands

A couple of readers suggested I talk to Danny Sands. He’s an assistant clinical professor of medicine at Harvard Medical School and senior medical informatics director for Cisco Systems. If anything interesting happens in the industry, he will hear about it while wearing one of those two significant hats. I have to figure out what whole bicoastal, two paychecks thing since he seems to be having a ball.

Dr. Sands earned his medical degree from Ohio State and a master’s from Harvard. He did his medical residency at Boston City Hospital and an informatics fellowship at Beth Israel Deaconess Medical Center. He’s also on AMIA’s board and is a fellow in both the American College of Physicians and the American College of Medical Informatics.

Thanks to Danny for spending time with me.

Describe your job at Cisco.

My position is as the senior medical informatics director. I work in a part of the organization called the Internet Business Solutions Group, or IBSG.

Cisco has always been organized around engineering and sales. There was no verticalization of the organization at all. Five or six years ago, the company started to understand how it could do verticals better and created IBSG. We have maybe six to eight verticals and healthcare is one of the most mature.

IBSG can be thought of as the global, no-fee consulting organization of Cisco. We’re vertical-specific. We do consulting in a limited way with important customers around the world. In healthcare, our job is to help Cisco understand healthcare in a very deep way and to let our customers know we understand healthcare.

Given our size, our consulting engagements aren’t like Accenture’s. They’re just six to eight months. We work with CxOs to understand business and clinical problems and develop solutions, often employing technology. We think deeply about the industry, always thinking about what’s happening in healthcare and healthcare IT and how we can effect change in healthcare through our writings and working with Congress and ministries of health around the world. We’re transforming health to practice in the most clinically safe and high quality and cost-effective manner possible.

Everybody’s talking about Cisco’s recent announcement about its healthcare growth. What’s driving that growth?

Healthcare is an industry in which organizations have under-invested in technology for so many years. Back when computers were just becoming ubiquitous, every industry that viewed itself as information-intensive was investing in infrastructure to put in the fundamental applications. Now, they’re investing 8-10% of revenue and doing very sophisticated things.

Healthcare has not viewed itself as an information-intensive industry, which is quite a shock to those practicing in it. It hasn’t viewed itself that way, except for billing, and hasn’t built up infrastructure and put in fundamental applications and databases to deliver care effectively.

Healthcare is investing 2.5% of revenue and still falling behind. For years, it was even less, under 2%, and there’s a lot of catching up to do. Many organizations are behind the eight ball and it will take awhile to catch up. They’re beginning to understand that this is an information-intensive industry, and for quality metrics, they will need technology.

There’s a huge market in healthcare. What we’re interested in doing isn’t just selling stuff, but helping people do business and clinical work effectively. Cisco started investing several years ago because we saw the technology was underutilized and we could really help the industry.

Does Cisco manage healthcare the same as other vertical markets?

Yes. The IBSG has verticals in retail, public sector, entertainment, financial services … so we have a bunch of these things. In this consulting group, we have 225 peple around the world, so it’s not a huge organization. Intel has more than 200 in just their digital health organization.

My counterparts do similar things to what we do. Some of them do more traditional consulting instead of the thought creation we often do. So, healthcare is pushing into areas that not all the verticals have done yet. We also have a sales force dedicated to healthcare.

I think we go about things differently because we’re offering to be a partner that understands healthcare. In our group, we have expertise across the spectrum: healthcare consulting, nurses, nurse practitioner. People who understand networking, homecare … someone from life sciences, someone in the payer market. We have a breadth of expertise becaue we’re coming at it from so many different sides.

What are the biggest technology challenges in healthcare?

The biggest challenge is the lack of capital to invest. Still today. If we look at organizations, larger healthcare organizations will spend more money and will be more forward-thinking. Intermountain, New York Presbyterian, those centers of excellence. We have these name brand organizations that have clearly spent a lot on IT and have done neat things.

You have others that big who have the margins to invest. You have others that are struggling financially. Hospitals are running near-negative margins. If you’re in a business with no margins, you’re just trying to keep your head above water.

It’s similar in practices. They mirror hospitals in that larger ones have infrastructure and staff and revenue, but in the smaller practices where most care is delivered, no margin, no infrastructure. The biggest problem is appropriate investment in technology.

One barrier is a misalignment of incentives. Who is investing the money and who is benefiting? Clearly, if a hospital invests in technology, they need to see some return on investment. Some may come from reduced cost of handling records. It’s a lot harder for practices to make these justifications. Larger institutions are doing better in being able to step back and look at their issues. We’re focusing on large enterprise users for that reason.

We have a very hands-on business in healthcare. We can’t replace people, but we must keep them in mind all the time. We need to remember that people have a limited capacity to change, so you have to help people apply the technology in their work. Healthcare is hands-on and so is introducing technology into it, so we want it to be done appropriately. There have been too many situations where hospitals have invested money and their projects haven’t been successful, often because they didn’t involve clinical staff from the beginning.

Is “medical grade network” a technology or a marketing approach?

That is a technology. When I talk about setting an appropriate infrastrucrtre, that’s what I’m talking about. It is an architecture for building a network that is resilient and reliable and secure and has survivability, those things we need in a mission-critical environment.

You can’t afford to have a network go down in healthcare. It must be hardened and tough. This is like plumbing or running water and electricity and needs to be that reliable. We say the fourth utility is a converged network. It brings together all the low-voltage circuits into a very reliable, robust network that’s expandable and can be managed. You need to be able to grow a network as you add more functionality and nodes. Sometimes that means adding to it, sometimes shutting parts down without bringing down the whole network.

You were at Beth Israel in 2002 when network failures caused what might be the biggest patient-impacting systems outage in history. Is it ironic that you’re working for Cisco?

It’s a great point. I tell that story often. Fortunately, I had no responsibility for the network management there. [laughs] The situation was that nobody was minding the infrastructure.

A network is a living, breathing entity. One needs to not only create an architecture, but maintain it to ensure it performs well. At Beth Israel, we weren’t investing in maintaining the infrastructure. Not only was it no longer architected correctly, it wasn’t managed over time, so it was vulnerable.

That sort of travesty could not occur with what we’re architecting now. I’m sure that will never happen again at Beth Israel. [laughs]

Wireless networking in hospitals is suddenly prevalent. Have caregivers and clinical software vendors embraced the concept that computer users aren’t chained to desks any more?

That’s one of the big waves that’s coming. We no longer have to think in terms of desktops, but can think of devices. Whether tablet or desktop or biomedical engineering equipment, everything becomes a node on the network. That’s the way that more progressive IT groups are thinking about things. That doesn’t mean there’s no role for the desktop PC, but there are roles for other wireless devices.

We need to think more about untethering hospital personnel from walls so they can interact with their hospital information system while sitting at a patient’s bedside. It could be a wireless phone so patients can communicate with them. Because it’s an IP phone, it’s part of the network and can share any information from the network. We can ID a patient, get a test result.

It shouldn’t matter what kind of device it is, whether it’s a wireless phone or tablet computer or PDA or desktop. All of these can interoperate on the medical grade network. The last mobility trend in hospital was COWs. Those are fine, but there are a lot of places you can’t wheel one in. It’s nice to have something that’s truly portable. The interoperability becomes important.

As we introduce new varieties of devices, whether phone or PDA or tablet, we’ll need to reinvent some of these applications, creating applications that are customized to that form factor. We have already seen some of this, like PatientKeeper and MercuryMD. We will have to see more hospital information systems that run on a tablet computer, for example.

Cisco is building unified communications. It doesn’t matter what device you’re using. You can communicate with all. Open a directory and communicate with anyone in whatever manner they want to be communicated with. Dr. Smith may say they’d like to be text messaged first. Everybody can have their own preferences. That’s a more effective way to start communication with people, by not annoying them by contacting them in a way they don’t like.

They can seamlessly move from a text sesson to a phone system or a collaborative session on the Web where we’re sharing a screen. Unified communications will change healthcare. So much of what we do in healthcare is communicating, yet our technologies are primitive.

Give me the Cisco perspective of the Cisco-sponsored HIMSS Community for Connected Health.

We wanted to form a community of people thinking about the connected health concept. That’s almost the form of a user group, but it’s a community. People can share ideas with each other and with us. I don’t know how this worked with HIMSS, but we’re really just trying to reach out and think about community.

As an aside, Cisco has embraced the idea of Web 2.0 and groupware and collaboration. We’re trying to experiment with that in many different ways, like wikis and a new directory that’s almost like Facebook. We think the future is collaboration. When I watch my teenaged daughters on the computer, they’re collaborating all the time. They don’t use traditional means, even e-mail. They skip that and go right to Facebook and MySpace. We’re trying to do these things in Cisco.

Cisco tries to do the things that it gets other people to do. If we think it’s a coming trend, we try in on ourselves first. Another example is Second Life. We have a community there, where we’re trying to push the envelope. We don’t think we can continue to grow the way we’re growing unless we’re collaborative.

John Chambers says he wants us to reduce our travel 20% over the next year using the technologies we sell. TelePresence is a totally game-changing technology. It is totally unlike videocoferencing. It does what videoconferencing promised to do. You really hear people in high definition, see people and even see them sweating, and feel like you met the people on the other side of the table. It’s almost entirely transparent to the users. We’re not really aware it’s there. The problem with videoconferencing is that you’re always aware it’s there, with jerky motion and synchronization problems.

We’re using TelePresence internally. The first customer was Cisco. We put it in all our major offices all over the world and we’re encouraged to use it so we don’t have to fly anywhere. I’ve been able to avert flights all over the country by using TelePresence.

Are today’s electronic medical records systems too tied to the paradigm that physicians have to enter their own data to give and receive value from those systems?

There are many potential sources of information. Some are machines, some are people, and some are people and machine at other institutions. We have to figure out what is the most efficient way to get information from these places and present ot to the clinicians.

There is a large amount of information that we acquire in the course of interaction with patients. Much of it has to be entered by us, one way or another. There’s a large body that clinicians are responsible for entering that should come directly from the source. It would be preposterous to look at a printout of a lab test and type that into a computer. Likewise, why is it that we interview a patient and enter their information into the clinical information system? There’s a practical barrier if the patient is lying down with a gunshot wound, but in many situations, we can take advantage of the patient. The patient is the most important yet underutilized source of information in healthcare.

We’re often very keyboard-centric. There are lots of ways I can interact with a computer – a stylus on a tablet; dictating and having it trabscribed by computer or human; and typing, which can be templated or free-texted.

There’s another aspect to your question, which is that our information systems tend to be very doctor-focused, or let’s say clinician-focused. Just as we don’t ask our patients to enter information into a computer to help their health, we often don’t share the information in the computer with our patients. Patients need to play a bigger role in healthcare.

We don’t think of them this way, but patients are our customers. That leads to problems where we don’t share information and don’t make it easy for patients to make an appointment or get a referral or get test results. We should do these if we’re truly patient-focused. When patients have access to information, it can be more satisfying to both doctor and health.

The physician brings a complementary skill set. You’re an expert in you. If we have a common database and bring our expertise together, we can make tremendous things happen and improve the way we deliver care. There’s some preliminary evidence that patients engaged in this way have better health outcomes.

What about other information types, such as video and voice?

We need to be storing more rich multimedia information about our patients. The first wave was the PACS movement and that’s terrific. It’s amazing as a doctor to be able to see the image instead of just reading the text report. We need more of that. PACS was developed separately from the HIS.

We need a convergence of text and multimedia and it shouldn’t just be radiology images. Cardiology images, photos of a wound, video of a patient walking, pathology images, voice files -– all should be part of the record.

That necessitates data acquisition that we don’t have right now. We’re lucky in a clinic if there’s a digital camera around. We need to think in terms of multimedia acquisition devices. There are digital ophthalmoscopes and otoscopes. We need to acquire that information, capture it, and store it in the record. That requires a new set of input devices and interfaces to the hospital system so that multimedia objects can be stored and retrieved as part of the record, not as a separate system.

A digital image is not only far more effective at delivering information, you can manipulate it. It also requires efficient storage and an efficient network to convey those large objects. Those last two areas are what Cisco is interested in. We do storage area networks to store information more cost effectively. We’ve also pushed network convergence, where video can travel across the network. We’re partnering with some of the big HIT vendors to develop new functionality.

You were an advocate of electronic patient-physician communication. What’s the status of those projects?

A lot of doctors haven’t yet embraced the technology for the same reasons – time, liability, and reimbursement.

An exciting trend is the number of practices and institutions offering patient portal services that offer patient-provider communication. Kaiser rolled out Epic MyChart to millions of patients. That’s huge. It’s far and away the largest deployment of that kind in the world.

We’re seeing adoption among larger practices and more enlightented healthcare institutions in deploying patient portals that provide secure communications. I choose to look at it as a positive trend, even though figures haven’t taken off like I would have thought. The volume of messages a doctor gets from patients is very modest, even when you’re not charging a fee. At Beth Israel, for every 100 patients registered on the system, they’ll generate less than one e-mail a day to the doctor.

What IP-connected devices will have the most impact on healthcare delivery in the next 5-10 years?

Home care. I think there is no question that we need to be reaching into patients’ homes. That’s where patients are sick with chronic conditions. I think we’lll go beyond that and catch patients earlier in their disease or when they’re pre-symptomatic. It will be commonplace to interface with your set-top box or glucometer.

Home care, along with nursing homes, is quite technologically backward. It’s a real shame because these are our most vulberable and sickest people. These will be new markets where we can make a huge impact.

Location-based services, like tracking of things in a hospital,will be successful. Once you’ve deployed a robust wireless network, you have two ancillary benefits. One is the ability to do tracking, or location-based services. I can put a tag on my wheelchairs and infusion devices and code carts and track them throughout the institution through the wireless access points. It’s exciting that you can find out where the equipment is that you need.

You can also create a second wireless network for guest use. When you’re going to visit someone, you can connect your laptop to a public network that’s separate from the secure internal network. Most hospitals aren’t set up this way. They have one wireless network that’s for staff. Offering this for patients, especially for those in units like cancer units where they’re in for a long time, is a great service.

Any final thoughts?

This is a very exciting time to be in healthcare IT. Because of the robustness of the technologies and the ability to implement them effectively, it’s a tremendous time and I’m excited to be part of the industry and Cisco.

I really salute all the people working in this space. We need to remember that we need all kinds of players to effectively implement these systems. It’s not something an IT department alone can do. Vendors, C-level executivess, providers …  it’s an important collaboration pushing IT out to physicians, nurses, and patients. If we do this intelligently, we can make a huge difference. That’s why I’m in this business.

HIStalk Interviews Art Vandelay, A Reader Who Knows His Stuff

September 17, 2007 Interviews 5 Comments

by Inga

HIStalk has a surprising number of great posters who provide thoughtful commentary. One such reader is Art Vandelay, whom I decided was a genius after he provided a terrific analysis of how healthcare would be impacted by Wal-Mart. I had to think of a creative excuse to talk to this great mind, so I convinced Mr. H that Art would be a great interview subject.

Inga: Art Vandelay is not your real name. How did you select it?

Art: I really enjoy Seinfeld and saw a few references to it in HIStalk, so I took it to see if anyone knew what I was talking about. Art is not a real person. He is an artificial character, so I can relate it to my alter ego.

How long have you been reading and posting on HIStalk?

I have been reading since mid to late 2006 and never really went too far back on old posts, but definitely read it as soon as it comes out. I find it interesting and timely. An interesting phenomenon is that some of my old colleagues have left healthcare. HIStalk replaces some of the old shop talk I used to have with my colleagues. It’s a good bridge for that.

What can you share about your background? What do you do besides write interesting commentary on HIStalk?

[Laughs] Right now I am working for a large delivery system. Essentially, I am responsible for a lot of their different initiatives. It’s a lot of project-based work. It involves pieces and parts of an enterprise architecture, but they really don’t call it that.

Prior to that, I was working for a large healthcare outsourcer and had done some cutting edge development work on that. It was really interesting work. I got to work with some old legacy systems and integrated them with newer technology using Web services.

Before that, I worked with a Big 6 consulting firm, back when there was a Big 6, primarily helping with system selection, organization strategic reviews, and package system implementation. I burned out on that really fast. You do double the work you do with other organizations. But it was a great experience.

I graduated with a Masters in healthcare management and was really intent in landing on the business side of healthcare, but the money was on the technology side and I’ve really enjoyed it.

What would you say is your primary area of HIT expertise?

Wow, I never really thought of that. I have a very strong understanding of the vendor space and a general understanding of the architecture. I am more of an apps person than an infrastructure person. I operate more at a business interface level and have worked more with business unit sponsors on the projects I have worked on.

Some of your postings are fairly technical.

Yeah, I have gotten to know a lot of that because of a lot of the things I was involved with before. You can’t work with all the vendors without knowing all the blemishes around them. But I consider myself more on the business side.

Do follow other HIT blogs?

Actually, let me check my RSS reader [Inga laughs because it is such a techy thing to do – even if Art is just on the “business side.”] Shahid Shah The Healthcare IT guy, Medical Connectivity, Neil Versel, Candid CIO, Ignacio Valdes, MD – Linux Medical News, NeoTool Healthcare IT, Running a Hospital, and LabSoftNews.

You are well read.

Yes. I like reading little snippet things. The blogosphere is good for that.

Are there any HIT companies that you believe are doing things right?

I think overall that some of the niche vendors are more innovative. Companies like SCI. They have made a good niche for themselves, but need to more aggressively market themselves. They need to promote their value proposition, to get in there and push their story better. I have heard really good things about them.

NeoTool has an interesting niche around interface delivery using BizTalk. Offering a competing product is a bold move because it may cause channel conflict. Medseek has done some interesting work and is addressing some unfulfilled niches. Emergin is very innovative, have a great niche. It will be interesting to see what do they do next, if they will they take their product to the next level. They have a very strong position from which to build.

The biggies aren’t doing a lot right now or at least not showing a lot of value. Cerner, Eclipsys, Siemens, Epic. They are trying to be too many things at one time right now.

Are there any up and coming trends that you think are going to be big?

A lot! [laughs]. I could talk about that for a long time. Retail, I think, diverse delivery locations and anyone doing medical storefront. Consumer-driven health plans. With high deductibles, consumers will have more control over where they go if they have a particular condition and they can choose their specialist. Medical tourism will probably pick up because of consumer-driven healthcare. It might be overseas or in a vacation spot.

So, what I really see being pushed is more continuity of care record, CCR. There will be a bigger push because you are going to receive your care in different places and you need to bring your medical record back with you.

You are definitely going to see a lot of virtual alliances, like people partnering with Wal-Mart locally to meet referral patterns or Cerner working in Dubai and Cleveland Clinic in the Middle East. A lot of health systems are trying to take their brand images overseas, essentially putting their Good Housekeeping seal of approval on the overseas facility. From a practicality standpoint, that means more network linkage. Some growth of teleconsulting will come with that.

Really, when you start to look at consumer-driven healthcare, it might lead to patient liability estimators. If I go to health system X, I can expect to pay $10,000 on a surgery and $12,000 at health system Y. Then I can decide how I spend my money.

There is going to be a big push on outcomes information, high-level stuff. Everyone defines an outcome in a slightly different way. When we capture it, we discretely capture it, but, each entity defines it differently.

With consumer-driven healthcare, you probably will see more push for access statistics. How quickly can you can get into a location? If you can’t get in to see a physician, who cares how good he is?

The pay-for-performance trend will drive the need for more metrics. There needs to be a lot of work to define things and there needs to be standardized data definition. I could keep going …

Great! Keep going.

Direct contracting will make a comeback. Health systems will try to directly work with employers to get the every last bit of margin out. But they will have to watch what they are getting into. I can see payers trying to prevent entry of providers, which will affect costs even more. Managed care contracting, referral management, decision support around cost modeling – all will make a comeback.

Increased consolidation among payers and providers. Who would have thought someone would partner with Wal-Mart?

Another big trend is centralization. You see this within organizations and in a technology-enabled way with remote monitoring. A lot of people are making moves in the home monitoring space. Folks are discharged as inpatients, but need some monitoring at home. Monitoring elderly folks with RFID to make sure they are eating, not wandering, going to the bathroom.

PACS, allowing remote diagnosis. As that becomes more prevalent in other specialties, you will see a push for some health systems trying to brand themselves. Wouldn’t you want a Mayo doctor to look at your EEG?

With that, a lot of the remote consults would come up. Get a second opinion with Cleveland Clinic. Within organizations, I see consolidation between clinical engineering and IT. The medical device manufacturers are introducing mainstream technology with a whole new slew of challenges in terms of maintenance, integrating, and day-to-day maintenance. Integration is a new skill set that IT companies can bring to them.

Labsoft News talks about convergence between lab and radiology departments. That will definitely come about. Nicholas Carr, a Harvard professor, talked about “IT doesn’t matter”. In my mind, it gets down to our IT departments. Will they deliver commodity services, or, will they become partners with the business side? Organizations are expecting their investments to show return. IT departments either will step up or will be relegated to utility.

Because of the economy, I think there will be a big focus on value. How do I squeeze the most amount of capability in all the technology I have invested in? Which goes back to IT partnering on the business side. IT has to really get involved in the business.

I would expect a growing number of organizations to have CIOs take over the business function. You are seeing it a little in other industries and I think it will come out in healthcare. CIOs are ready to take another step. For CIOs that have made promises, they are going to be asked to step forward and show ROI.

I think we are going to see a return of some best-of-breed. As purse strings get a little tighter, I think best-of-breed will come to show the best ROI, rather than a full Cerner or Epic system.

There is focus on squeezing the value out of investments and a lot of vendors are acquiring because of that. They will go for some of the niche vendors that can add value to their systems. Around revenue cycle systems, who really has done anything new? No one has any investment in R&D that is showing anything. The big vendors will buy small niche players to tap on to the maintenance stream and fill the product gaps.

Who do you admire in the industry ?

Mr. HIStalk, because he makes some very good observations and has great commentary. It’s true. I think I have made some comments about Emergin’s CEO. It’s going to be interesting to see what they do next.

I admire the Epic leadership team. They have created a brand around themselves. I don’t know if it was meant to be that way, but I think it gets them a lot of attention. Among a lot of the biggies, they have delivered the best and kept promises.

Anything else you would like to add?

One question that you forgot to ask, my dream job. A consultant who really didn’t have to travel that much. What drugs am I on – no travel? Think tank analyst. I’d love to be able to what-if all day, debate with someone, and get paid for it.

Realistically, it is anything where I could feel I am making a difference that would provide a solid standard of living so I could consistently be with my wife and kid.

HIStalk Interviews Joel Diamond, MD, Chief Medical Officer of dbMotion

September 12, 2007 Interviews 3 Comments

diamond

A reader suggested that we might want to talk to Joel Diamond MD, chief medical officer for dbMotion, practicing family physician, and a former CMIO with UPMC. “You should try to interview Joel – he is smart and funny and really knows his stuff.”

Joel is working on an $84 million initiative to jointly create a healthcare interoperability model that will use dbMotion’s technology to connect clinicians across UPMC’s 19 hospitals and 400 outpatient sites and doctor offices. Thanks to Joel Diamond for sharing his thoughts with the readers of HIStalk.

Inga: OK, you ready to go?

Joel: Yes, though I am really nervous. Is this really Inga? [laughs]

[Laughs] Yes, but don’t be nervous. So, you do read HIStalk?

All the time. I am a huge fan.

So, you came from UPMC where you were CMIO. What led to your decision to move to dbMotion?

I have been following the interoperability plans for UPMC for a very, very long time ever since I was involved in establishing UPMC’s CPOE at one of UPMC’s remote hospitals. After the success of CPOE and other projects, it was clear that interoperability was the solution of the future. I dug in and learned about dbMotion. When I found they were looking for a medical director in the US, I jumped on the opportunity. dbMotion is great and it is a fun job.

Tell me about your position as CMO with dbMotion. What type of activities are you involved with?

The bulk of my work is this massive UPMC project, which has two separate parts to it. First, the core interoperability project itself. There is a lot of work to be done here in terms of customizing the physician views and integrating the multiple disparate platforms. The UPMC project itself is massive because we are trying to interface many, many disparate systems.

Also there is a joint development project between db and UPMC that is just getting off the ground. We are trying to develop a product to enhance patient safety issues. Trying to have the product reflect the needs of individual clinicians is one of our major goals.

In October, dbMotion and UPMC announced an agreement to create a joint development partnership. What is the scope of the project?

It is centered around a product called SmartWatch. SmartWatch is focused on looking at populations of patients and then being able to get lots of disparate data and then turn it into something actionable. For instance, we could define what child abuse might be and what to look for, and then put in certain parameters in order to monitor it. Patients with certain characteristics can be found and then you are able to report it to a particular organization or entity. Or it might involve bio-surveillance on a large scale.

We have a couple of use cases we are developing with UPMC. One of them involves transfer of care. When going from one venue to another, determining what needs to be done to ensure that the handoff is done properly and the patient information is collated properly. One of the other use cases is readiness assessment. If a patient has to schedule a procedure, then determining everything that needs to be done on an administrative level and making sure it is done. Third is chronic disease management and it will likely center around diabetes.

Are you involved with any of the international projects that dbMotion is working on?

No, because we have a CMO of dbmotion in Israel, Dr. Ran Goshen, who oversees all those projects.

What about any non-UPMC activities?

Dr. Diamond: Some with the Bronx RHIO project that is underway and has an expected go live in May of ‘08. I am also involved in the evaluation of new business opportunities in the US market.

Are you also visiting potential clients?

Yes, as well as trying to explore new areas where dbMotion might be needed other than what we have been focused on.

There have been a number of announcements over the last few months of RHIO efforts that have failed, either due to financial issues or lack of support from the community. Does that concern you?

It really doesn’t. It really isn’t a surprise. If you look at the Gartner’s Hype Cycle, we are at the Trough of Disillusionment. There had been some unrealistic expectations. We are now much more realistic about what RHIOs can do.

I am not pessimistic about RHIOs all. I think our focus will change a little bit. A lot of people set out to do RHIOs, but didn’t have the technology to do it. I think that is where dbMotion makes a difference.

Who does dbMotion see as competitors?

A lot of people are in the so-called interoperability space, but we don’t necessarily see them as competitors because they have a very different focus than us. A lot of people are in the portal space and that is more of a forum to view information. There are several companies trying to collect data to see in a single space. dbMotion is different because we have the Unified Medical Schema and we are focused on aggregation and integration of data.

So, explain to me how dbMotion is different than a company like Healthvision?

dbMotion has very, very unique architecture that allows it to handle a lot of the complicated interoperability issues in a very, very short time. It has a broad and deep reach. We are not a product that just has the ability to point you to the information you need or just display data you need.

In a true schematic operability, you can exchange information because they have a common understanding. You may link up a disparate system that has different terminology for the same diagnosis. We have the ability to take the data and present it as a single common knowledge piece and do whatever needs to be done. It can be used by an individual in a format that is meaningful.

The other thing that is different is that if you are just presenting data, it becomes a very huge list for people to scroll through. A large data dump may discourage users from using it. Looking at a list of allergies, you may overlook important data if you don’t present the information in a format that is relevant to the physician. Our technology allows the information to be displayed in a more meaningful format. It also helps with patient safety.

Why are UPMC’s interoperability projects surviving?

There has been a tremendous vision from the start. In addition to that, the people involved in the project, from IT to doctors and nurses, have really kept the focus on the entire project more on a quality. So, focus plus talented people, and then they keep building on their successes. They have also had a very steady and well-constructed ambulatory project for EMRs that has allowed for integration of all the data, along with a goal of improving patient safety.

So the goals are good and people are good.

Yes, and they haven’t been afraid to change their course when appropriate. They realized at some point that having a one-size-fits-all model was not going to be sustainable. At that point, they realized they needed multiple solutions and needed some central ability to control the processes. And that is when the decision was made to partner with dbMotion.

I understand that in addition to your work with dbMotion you are still seeing patients. How do you balance your dbMotion work and your clinical activities?

Yes, I am still seeing patients. I am balancing it very carefully. [laughs] I need to maintain seeing patients on a personal level because I enjoy it so much. And, two, without seeing patients, I am not sure I can maintain credibility and an understanding of physician needs.

Having an EMR for so many years provides me access to my patients’ information in so many ways. I have a patient portal and use e-prescribing. Many of my patients I have known for years have access to me by cell phone 24×7, so my situation doesn’t mean they have any less access to me. I work one full and very long day in the office seeing patients.

You spent some time working with Misys in an advisory role for their EMR and CPR products. Any thoughts on the recent changes, including selling off the hospital pieces and re-selling the iMedica product?

I have mixed emotions on the CPR sale. I think it will help their focus. There were so many great people associated with that product. I think it was one of the best products I had ever seen.

I can’t comment on the business reasons and whether it was a good decision. But the product isn’t going away, so that is good. And, I wouldn’t know enough about the iMedica situation to comment about it at this point. I will say that Misys’ focus on the community is a very, very smart play.

Who do you admire in the industry?

Hmmm… Mr. HIStalk and Inga? It is a very, very long list after Inga and Mr. HIStalk.

HIStalk Interviews Nick Jacobs, CEO of Windber Medical Center

September 10, 2007 Interviews 1 Comment

NJ

Nick Jacobs isn’t just a popular blogger. He’s also president and CEO of Windber Research Institute and Windber Medical Center of Windber, PA. A couple of readers suggested I talk to Nick about small-hospital technology. If you think that’s an oxymoron, read on about what this tiny rural hospital of a few dozen beds is doing.

Thanks to Nick for the chat.

Tell me about Windber and about yourself.

The hospital is 101 years old, started specially as a hospital to take care of the coal miners for the 40+ coal mines of the Berwind-White Coal Company. When the town of Windber was constructed, it was seen as what would be a model town for the industrial revolution. Every house had a central heating system provided by the coal company, schools, hospitals, and churches. It was like the Celebration community in Orlando. The commitment was made that this hospital would be one of the most outstanding in the US.

For the first 40 years, the starting physicians were innovators, to the point they held numerous patents and successes. They studied with the Mayo brothers, like learning to remove the thyroid without leaving scar. Celebrities came for the surgery, like Betty Grable, Arthur Godfrey, and Jeanne Woolworth.

We’re 30 seconds from where Flight 93 went down. I came in 1997. We have 550 employees now and a $21 million payroll.

The issue for me when I came was that the hospital had been given a death certificate by Ernst and Young. In the coming era of capitated managed care, the hospital had a short life left. That gave me a chance to challenge my board. I told them, “We can let it go, or we can try to go back to innovation and technical advancement and high-touch care.”

We had the first hospice in the US, founded in 1977, for a rural area. I was able to use that as a model for physicians and the board, telling them, “Look how people are treated in the hospice. I want to take this hospital-wide.” We’re a Planetree hospital now, the third in the US of what is now 200. We embraced the concept of spiritual, holistic, mind-body-spirit care, the highest touch concept.

Having interviewed at Boys Town Hospital in Omaha in 1992, I got to a hospital that looked like Windber but was called National Research Hospital. I asked a priest why. He had 38 PhDs and was a genomics center in 1992. I found myself at a dinner party with our local Congressman talking about the Dean Ornish CAD Reversal Program. I explained it to him. He said, “We’re spending $1 billion a year on heart disease in the military.” We launched partnership with Walter Reed the following year.

Then, a board member got breast cancer and came to our hospital. That made me uncomfortable. I wondered why she didn’t go to Sloane-Kettering or MD Anderson. She went through it at our place, then went there for a second opinion. She went to our Congressman and said, “These guys have figured it out.” We have massage therapy, popcorn, clowns, family access, everything. She told the Congressman that the military was spending all that money, but nothing in our district.

We built a research facility with 50 scientists and 40,000 of the most highly annotated breast cancer tissue samples. These are longitudinal studies because they’re in the military. We built a team of biomedical informaticists who have perfected software and methodologies for mining huge quantities of medical-related data.

Because I’d never worked in a research institute, and in fact didn’t get into healthcare until I was 40 because I was a high school band director, one thing I discovered is that I didn’t care about the past and wasn’t tied to it. When I had a chance to create a research center from scratch, I decided I would meet with my first three PhD hires and ask them what the bottlenecks had been. First, all science is called small science. You get an idea for secret sauce, go to NIH for money, build your team, then I might take it away from you. I decided that instead of creating divas, I’d create a ensemble of people who could work with each other.

Also, I decided that all information would be stored together instead of on individual PCs. So, we had terabytes of data to study, but had to build from scratch data mining. I hired a Penn bioinformatics director, hired 10 people, and worked with dozens of companies to come up with trademarked capabilities. Researchers in our institute can query all 40,000 ladies in our database. How many of you drank coffee? How much coffee? Then, you can do an analysis of which ones got breast cancer. This was set up in a manner so that not all donated serum and blood and tumors were cancerous. Interesting. Maybe those who drank the most coffee don’t have breast cancer. It creates a way to query issues that could be pertinent to disease states. It was not disease-specific. It can apply to any disease.

I found that PhDs don’t talk to MDs. I hired some MDs and got teleconferencing to meet weekly with oncologists and pathologists from the Army about problems with individual patients. We took those back to the bench to find solutions. That’s translational medicine. We’re way out ahead of everybody’s headlights, and for those mired in the traditional system, they’re not only afraid but desperate victims because it changes the way they get funding.

To communicate information back and forth to the Army, we have a network of OC-48 capable dark fiber. We can transfer entire hard drives in seconds. In Windber, PA, a town of 4,200 people, we have some interesting opportunities. The space and missile defense command that had the original Star Wars defense program had a civilian who put together a team of $7 billion worth of research to fuse infrared and radar together to detect missiles from outer space. His sister died of breast cancer. He vowed to have those algorithms declassified for us to fuse ultrasound and digital mammography. GE is a partner doing research with us. We have three MRIs with breast-scanning capabilities doing fusion of technologies to find better ways to avoid misdiagnosis. All in a little 50-bed hospital two hours from Pittsburgh. It’s a fascinating evolution that came from the mind of a band director. [laughs]

Describe the hospital’s IT systems and their role in your strategic plan.

Because of the system that we’ve put together, we have interest from all over the world, except in the US. Go to the Netherlands, there are eight academic medical centers cooperating, but they didn’t have tools to mine the data to make it translational. We’ve been back and forth for a year working on software we created here to mine that data.

We get breast cancer tissue donations. We can do a genetic analysis in-house to determine which genes contributed to it. Then, we have the capability of determining which proteins were contributors to spreading the disease. Both of those modalities create huge quantities of data. Then, we do histopathology and molecular research, clinical and diagnostic data. We have mountains of data. One piece of equipment can create six months of data to research. We can see the potential impact of alcohol or obesity. We think it will contribute substantially to future cures as we analyze the data.

On the downside, we’re way out ahead of the headlights. We’ve spent millions trying to get software companies to cooperate with each other and designers. In one meeting, we had six companies involved in the data collection process. We had to put them in a room and lock them in until they agreed. Everybody was afraid to let their secret out. One large company that I’ll leave nameless – they can mine huge quantity of data for retail and banks, but in biology, they walked away and said, “We can’t and won’t do it becuase something that’s brown 1000 times turns green. It just happens.” They had no way to turn their analytical tools into biological analytical tools to meet our needs.. Another company asked for a meeting and in the NDA said, “Anything you say that we can remember, we can use.” [laughs]

How important is IT overall to a hospital’s success and to patient outcomes?

We just put out another $3 million for Meditech.

Concentia Digital of Columbia, Maryland … Duane Shugars is president, a young guy. His company was hired by National Geographic to digitally catalog all their images and films. If you want a picture of a lion with a bird on its nose, you can search for it on the Web and buy it on the Web. Then the NFL contracted with them to catalog and organize plays, so when they said, “Here are Terry Bradshaw’s top plays”, they can find them. Then the CIA and FBI hired them. They came to us through an acquaintance. Everything we do is digitized and put into their repository. With 40,000 samples, a single pathologist has done an analysis. He’s a research pathologist instead of a clinical pathologist, so instead of 20 things, he looks at 120. Theoretically, any scientist anywhere in the world looking for samples can be search and those samples would come to them visually.

They say politicians can have national influence, but they still have to be re-elected by the folks back home. Windber has a lot of national publicity, but you’ve said locals don’t really know much about the hospital. How can you bring the national message back home where it can do some good?

In 1977, we had the second Johnstown Flood. We had the largest out-migration of any urban area in the US except East St. Louis, Missouri. Our demographics look like Dade County, Florida. We have large quantities of octogenarians. The average person has lived in their home for 38 years. The hospital went through a tough decade in 60s and 70s. If they have a bad experience, they don’t easily forget it.

Our publicity has been in Forbes, Fortune, Wall Street Journal, CNN, the Today Show. That’s not where they live. It’s been a 10-year uphill battle to get our locals to realize that this is a unique place. The national infection rate is 9% in a hospital. Ours has been below 1% for almost nine years. So, how do you put billboards up and say, “Come to Windber and you’ll die less”? [laughs] It’s a challenge that doesn’t make for happy competitors.

We’re starting to get local recognition, but it’s happened because of my blogs. The former public relations director of the Pittsburgh Symphony, now 81 years old, said, “Why aren’t you blogging?” I wrote my first blog in May 2005, having no idea that I was the only hospital CEO with a hospital-endorsed blog in the country. The local paper asked me to write op-eds about healthcare. Another little paper asked me to write a comedy column and I became a local folk personality, the baby boomer with the child problems. Then, there were other blogs. The bad news is that none of them pay, but we’re getting the word out. When I was in the Netherlands, they said, “We love your blog.” [laughs]

Tell me about the Planetree system.

Angela Thieriot had to have surgery in the 1970s. She went into a San Francisco hospital and had the typical hospital experience, like being a lab rat. You’re a number and an organ and it’s cold and detached and there are heavy duty rules based on the military system of triage. She came out of it wrecked that American healthcare was so insensitive and cold.

She convinced the hospital to give her a wing to design care that doesn’t require leaving your dignity by the door. A hospital in Oregon tried it and was interviewed on Bill Moyer’s “Healing and the Mind.’ She became a folk hero in a little 50-bed hospital. The movement started to get traction. It did well for eight or so years, then died. A hospital in Connecticut bought the franchise rights and I was the third hospital in the US to become a Planetree hospital.

I’ve been on their board for four years. We’re pushing 160 hospitals worldwide. It’s catching on as Baby Boomers become patients. They’re not happy with instant Sanka in a pack. They will want a decaf latte with skim milk. It’s the best of a hotel, hospital, and spa. Patient empowerment and patient care. Care isn’t centered on physician times and dates or employee’s availability. It’s based on centering care around the patient. Every patient in our hospital is touched multiple times every day by caregivers other than RNs and MDs. We provide beds for loved ones, kitchens, showers, and beds in the OB suite.

The greatest compliment was when surveyors from state were here two years ago and couldn’t fund anything wrong. The surveyor said she wasn’t from around here and it was the 35th hospital she’d been in this year, but told her husband that if anything happened to her anywhere, no matter what, bring her here.

I’m 60 years old and have six heart stents and my mission is to change the way healthcare is delivered. I’m saddened by how science works and how hospitals don’t cross the line of taking care of souls and not bodies

Can the hospital succeed as an independent and can anybody compete with UPMC in western Pennsylvania?

I don’t know. If we had not made the choice made by our board, there would not be a community hospital here. Was either decision a good one for the community? The board chose to take this on and try to compete. We only represent 6% of the healthcare in this region. It’s not like we can put them out of business. On any given day, if you say “Go Penn State” or “Go Pitt”, you’ll make half the people in the room mad. It’s not just an UPMC juggernaut, it’s also a Geisinger juggernaut.

Three, four or five years from now, will Conemaugh survive? UPMC has already made a run on this area and it didn’t go the way they hoped, but they have their joint ventures and insurance here. It remains to be seen if Geisinger comes in. We can survive only if we put all the pieces of the puzzle together. Oprah drops off her dog at a spa 20 minutes from here. If I can get her in here and beat that 30% error rate … I think the answer is yes, we can survive, but that’s an uphill challenge.

You mentioned in discussing Michael Moore’s Sicko that we’ve never had a health policy in this country. Why do we need one and what will it take?

I’m not a policy wonk and I was out front in rejecting Hillary’s last plan. It doesn’t do any of us well to have what England or Canada has. The waiting time is years. People come across the border from Canada for heart surgery. I’m not sure that plan is the best way to go.

Internationally, we’re through the roof, #1 in cost and #42 in quality of health. I’ve seen a lot of diagnostics that relate to typical overhead. With a private insurance company, it’s 20%. With Medicare, 3%. There’s got to be something in between that makes this work. UPMC is positioning themselves to be a global player in single payer. Highmark is doing that. Does that look like Medicare or a modified insurance system?

I can be the least expensive hospital in the US and it doesn’t matter because the insurance company doesn’t have to pass it on to the consumer. We have to find a solution that doesn’t permit this outrageous 47 million people to be uninsured. That’s unconscionable. Some kind of single payer has to evolve or it will become a worse and worse train wreck.

You’re speaking at a blogging conference this month. What’s your message going to be?

So many of my peers are finance guys who stick their heads in the sand and go with business as usual. It’s kept us locked in the industrial revolution. I’m doing a podcast next Friday with someone from Mayo. Transparency will be huge. Communication through the Internet is huge. We’re more connected than we’ve ever been in history. A political leader who could lie to his people is being checked internationally by hundreds of young people. We’re finally totally linked.

I wrote a blog that I thought the demise of Imus was because of that. It wasn’t that he hadn’t said something like that 1000 times before, but everybody grabbed onto it and made something out of it. Get with it and figure it out. It’s the new world order. New tools will reach out to people in a different way that will make or break your business.

If you weren’t CEO at Windber, what job would you want?

If I’d been talented eough, a top level orchestra director. It’s the most rewarding thing I’ve ever done. Touching people’s lives like this is important, though. At this stage of my life, I’d just like to speak and write to change healthcare. I love getting the message out and shaking up the status quo. It’s not my system, it’s an old system that needs re-evaluated. Some day I’m going to write a book at how being a high school band director is like being a hospital administrator. It really is.

HIStalk Interviews Huy Nguyen MD, President and CEO of Cogon Systems, Inc.

August 22, 2007 Interviews 1 Comment

Huy Nguyen

Readers asked me during the HIMSS conference to check out Pensacola, FL-based Cogon Systems, Inc. I was vaguely aware that the company was doing some Florida RHIO work, but that was all I knew about them. HIStalk readers are talented at sniffing out up-and-comers that have the potential to be disruptive, so naturally I was up for learning more, even though I never did arrange a HIMSS rendezvous.

President and CEO Huy Nguyen was agreeable for a chat when I e-mailed recently. I appreciate his taking the time to give me some background on the company and to peek inside the mind of a Navy doctor turned entrepreneur, which I found fascinating.

First, help me pronounce your name and that of the company. Is it Hyoo NWEE-un?

Yes, and the company is pronounced COE-gun.

Tell me about yourself and Cogon Systems.

I’m a physician by training and I still practice part-time in the emergency environment. I like it because, at the end of the day, what we do in healthcare as well as in business has to translate to better patient care. It’s nice to continue to focus at a very trench level on what the end game is about.

I was a Navy physician. I became immersed in HIT because growing up as a military doctor meant cutting my teeth on an EHR. I always assumed that the market had systems as robust as the military’s systems.

Being an attending physician in the Navy, I was taught that, if you want lab results, you don’t go to the chart. You go to the computer and look it up. You certainly don’t query someone else to look up your data. Sometimes a doctor’s idea of an information system is to ask a nurse or clerk to bring up the information. In a naval career, you couldn’t ask that nurse because she might be a commander and you might be a lowly lieutenant. You knew better than to use her as an interface to your information system.

The Navy, early on, was an early adopter of new technology. One of the things it adopted early on was PDAs. In the early Palm and Handspring days, we bought into it hook, line, and sinker. At Naval Hospital Pensacola, the commander bought all the doctors PDAs. With your taxpayer dollars, I became enamored with the idea of mobile healthcare.

Those were glorified toys at that time. You stored everybody’s beeper and your calendar. That planted the seed in my mind – wait a minute, should this be an interface to the clinical data, just like the desktop was to the military’s CHCS clinical system?

I broached the idea of a mobile interface to clinical data with a friend of mine named David Hsu. We built a prototype and took it to the military. In typical bureaucratic fashion, they asked, “Aren’t you a doctor? Why are you building prototypes in your off hours?” They didn’t allow us to take it to the next step.

David and the engineers took it to Sacred Heart Hospital in Pensacola. This was in the pre-HIPAA era. Today, they’d laugh you out the door for asking for access to live data to build a system. They thought it was great that young engineers and I were interested.

The engineers took a prototype and brought it to production level. Once they had a working product, it was up to me to decide about my involvement with the venture. The guys approached me about running the thing, even though I didn’t come from a business background.

My wife and I thought about it. The military sent me off to Iraq in 2003 in ground support for the Iraq war. There’s nothing like war to make you a risk-taking entrepreneur. After seeing the fighting, I told my wife, “Heck, let’s go for it.”

I left the Navy in 2003 and took Cogon to the marketplace. At that time, we were mostly focused on mobile technology. We had to learn to integrate back-end healthcare systems, focusing on clinical systems. We became adept on variants and flavors of HL7. To stage the data to our mobile platform, we created a CDR.

We had a bunch of guys so focused on the mobile interface that they didn’t realize they were creating a robust back-end world. As we grew, we realized that the value isn’t moving clinical lab results or exposing them to front-end PDAs. The potential value is all the back-end stuff we did and the ability to integrate it into a comprehensive CDR.

I started to realize the true value of what we did. What about the possibility of integrating data from multiple providers? We became early thought leaders in Florida on health information exchanges. We grew our technology and moved way from an enterprise level platform to a Web-based platform.

We have a contract in South Florida and have integrated eight clinics, Mercy Hospital, and soon Jackson Memorial. We take data in HL7 or CCR formats and store those data in separate accounts. Once they’re in those repositories, we have a record adapter service.

We have a service-oriented architecture. We’re able to take data and adapt it to CCR and then move data within our own platform. Our Web portal is almost treated like a third party application. We don’t care which application we’re working with.

In the past four years, we’ve taken a mobile enterprise play and migrated to back-end clinical data integration and now have gone completely Web-based with it. We’re keen on SOA and standards like CCR. Hopefully, we can create a Web-based milieu and can launch potential other partners off that platform.

We’re not a RHIO company. We don’t send sales guys out to find RHIOs. Interoperability, especially with ONCHIT, is too much about RHIOs. A community is defined in different ways.

How is the Moment of Care product different than the usual physician portal?

It’s unique because it has the ability to give the end user control. In Miami, we have funding to establish information sharing between military and civilian providers. The portal can pull disparate records into a cumulative view. It also allows a provider to titrate how much data he wants to view.

Let’s say we have robust RHIO and a Nationwide Health Information Network. Let’s say the user can turn on the fire hose and we can bring in that patient’s clinical data, local and from all around the country. You’ll have to comb through that to make an assessment and plan. We drive our end users to an encounter-level screen to show what they’re interested in – a visit or a lab visit. We bring in the in-depth clinical data from only those encounters. So, what’s unique is the ability to leverage the Internet and control what the user wants to see.

Some would say that physician portals are obsolete in an era of interoperability, where information should be placed directly into EMR systems instead of just being read-only for those who go out looking for it. Do you agree?

I agree. It’s our plan as part of our continuing development. HIS is moving so fast that you always have to stay ahead of the curve.

I’m in complete agreement. I’d love to get to the point when the only people who look at our portal are those without EHRs. We serve as a true data hub. We take data from our trading partners and parse out data based on defined rules to entities that are authorized to take the data from us, consume it, and transiently display it in their own system – electronic health records, disease management, pay for performance, whatever. We would then supply data to those applications.

Once you create a good interoperable platform, it’s not just the Cogon portal. They key is to create a milieu that can grow a wide variety of value-added applications.

As a small company, how can you market and sell your product?

We think of ourselves as a healthcare interoperability solutions partner. One of the things we do that allows us to compete in our regional markets of focus is that we look at ourselves as a partnership. We have a cost-effective application platform that allows people to integrate into the exchange and from there. We are keen in almost liberating the data in a secure manner.

We’re pretty flexible, being privately held, on the best business model that fits a particular community. Is our platform a shrink-wrapped package? Yes, but what are we going to do with it and what’s the endgame? We spend time helping client figure that out. We don’t go into a relationship and say “This is what our package does.”

In South Florida, that community and the folks involved in that RHIO were very forward-thinking. Think of your major metro areas. I don’t think there’s a consensus yet or even close on sharing health information. Miami is quickly coalescing around this. We were fortunate to be early thought leaders. From the get-go, the RHIO has always gotten a sense that we were more than a technology vendor, we were a partner in the deal. As long as I’m running the company, that sense of customer relations will be part of our way of doing business.

A lot of companies are committed to the RHIO vision. Some of their commitment is not straightforward. Others are committed, but don’t have the wherewithal to get the job done.

Earlier versions of the company’s web page list a co-founder and several other executives. Has the management team changed?

Companies, certainly entrepreneur efforts, go though phases of development. The first phase is all about the vision, the conceptual idea and the visionary leader’s hopes and dreams. It was mobile technology in healthcare.

Then, you go to the prototype phase, where you get something to work. Then, the initial market phase, where you have no clue what the market wants, but you think you can teach it what it wants. That’s completely ineffective.

At some point, you go through a process phase, where you realize your prototype isn’t scalable to production level, and the market is telling us our true value is elsewhere. In our case, the market was telling us our mobile technology was gee-whizzy, but it was our integration they wanted.

Then, you reach production. You’re not prototyping any more. You’re delivering the product plan.

Then, you reach nirvana – churning it out, being good partners, delivering on a tight timeframe. Execution is incredibly important.

We have undergone personnel changes as we entered the different phases. As a physician, I realized that it’s great to have clinical knowledge and insights, but at the end of the day, if I wanted to keep running the company, I had to evolve. Vision is great, but execution is better. Was I a manager or a doctor who happened to run a software company? My job is to be a great manager. I have evolved and changed personnel to evolve. The processes for prototyping to delivering widgets is a totally different mindset and sense of purpose.

From the perspective of both headcount and the bottom line, we’ve grown nicely. My #1 growth need is good people who want to work in a culture of quantifiable accountability. This is a company where we are very metric-driven. It’s transparent and achievers are rewarded. I’m looking for developers and sales and business development people.

When I Google Cogon Systems, I get an ad for Patientkeeper. Is that surprising?

That does surprise me, but I think people still think of us as a mobile technology play. A lot of us have realized that mobile technology itself is not a sustainable model. We started to make the move away from being a pure mobile technology play in about a year and a half.

Managers don’t bury their heads in the sand. If you’re a good manager, you read what the market is saying, not what you hope the market is saying. For a lot of us purely focused on mobile technology, too many people hung in there thinking it was going to be rampant when that’s not what the market was seeing.

We haven’t given up on mobile technology. We have a project with the Army on mobile technology on our common Web-based platform, so we’ll continue to drive the possibility of mobile technology of healthcare. You just can’t base your whole business model on it.

The iPhone is just the beginning. This is the second or third inning in mobile technology. In healthcare, we’re in the first inning. It has a very promising future in healthcare and we’re interested in driving value-added solutions from our health interoperability platform.

You were a Navy physician before starting the company. What do you like and dislike about being an entrepreneur?

I dislike, as is typical as someone from a physician background, that things never happen as fast as I’d like to see them happen. The great thing about medicine is that there’s always a conclusion at the end of the day. In business, I learn every day to be patient.

Like South Florida. The people who audit the project would say it’s impressive what we did, indexing live data in six months and in production use. For a lot of people, that would be a fairly rapid implementation. Six months for a doctor is still a long time. Sometimes I find that frustrating.

I’m frustrated both as a doctor and as someone on the technology business side that we’re not as sophisticated as other sectors, like retail and banking. I see much greater interoperability and the power of the Internet. I’m involved in healthcare as a provider and as a technology provider, and at times it hurts me that we’re dealing with people’s health, more important than banking accounts, and we’re not as sophisticated.

What’s exhilarating is that drive for greater performance. If you’re a good company, it takes on a new life of its own and it’s greater than any individual component. If I’m not the best manager, Cogon will replace me. The challenge is on me to keep up with the growth of the company.

That drive always to be bigger, better, more profitable … it’s never enough. You can go talk to the CEO of GE and he’s in the same boat. You can make 10,000 times Cogon Systems, but he and I still share the same fundamental drive – how can I be better and bigger tomorrow?

Executing as a team. Medicine is an individualistic endeavor. If you come into my ER unresponsive, I’m not going to survey my team and ask if should start CPR or intubate you. I’m going to tell people what needs to be done and we’re going to get to it. It’s exhilarating motivating people toward a common goal and delivering it. That’s the most rewarding aspect of business. We’re at the stage of execution and we have an advanced platform, but at the end of the day, what are we going to do with it for a particular client, on time, as promised, and as defined by cost.

What’s the five-year plan for the company?

I’d like for us to be the leader in healthcare interoperability solutions at either a hospital level or even a community level. I’d like for us to be extremely competitive in using the best of the Internet age and the best of creating an interoperable world.

Just as importantly, we’re looking at creative business models to facilitate people getting into this interoperable world, with minimal cost to get on board to trade data as a community. Creating an environment where we have a lot of partners that can drive solutions off that platform, with a whole host of companies that use our platform to create disease management modules or take our data and present it inside their EHRs and facilitate better patient care.

Finally, as a physician, my hope is in five years that our technology has very direct implication on patient care and a more sophisticated, empowered consumer.

What healthcare IT people and companies do you admire?

I particularly admire GE across the board. I think GE always has that drive to be bigger and better. If you’re in this business, your goal is how to serve the market better. They have a diverse portfolio and their ability to manage that diversity is incredibly impressive to me.

What could we do better as an industry?

I would like to see a greater level of consensus and collaboration of emerging standards or a drive toward an interoperable world. We still have a tendency to think about “our solutions, our clients, our turf”. I’d like to see us make greater inroads to lead the charge to facilitating patient care with an interoperable stance. I’m glad the government is leading the charge, but we have to decide if we’re a market or a government endeavor. I’m a proponent of healthcare as a market and I’d like to see the market take the lead in driving the issue of interoperability.

As a doctor and someone in business, what are your thoughts about the role of HIS in healthcare as a whole?

We ought to be clear to the healthcare market and the country and political leaders. There’s a lot of inefficiency and we know it. But, information technology is not the panacea to the underlying healthcare issues.

As a doctor, one thing that always concerns me practicing in the emergency environment is, “Does the patient have access to care and can they afford care? Can they afford a $100 antibiotic, do they have insurance?” No matter how good our common dream of an interoperable world, it doesn’t solve the basic problem of whether that patient can afford the antibiotic.

When I see during the selection cycle using health information technology as a possible panacea, I think it diverts people from some basic underlying issues. Is it a right or a privilege? If it’s a right, how do we pay for it? If it’s a privilege, how do we help people who can’t pay for it? If we’re thinking about HIS as a means to improve cost containment, that’s one thing, but if you’re focused on that as a way to solve the overall problem, you’re being completely disingenuous or naïve.

HIStalk Interviews Ken Creager, Sr. Dir. Strategic Markets, Meru Networks

August 15, 2007 Interviews 1 Comment

Ken Creager

A long-time reader whose background is clinical suggested I talk to the folks at Meru Networks. I figured it takes a lot to get a clinician excited about IT nuts-and-bolts stuff, so I was happy that Ken Creager, senior director of strategic markets for Meru, agreed to chat. I hear gripes regularly about wireless networks, even with the relatively modest demands placed on them. I was interested to learn more about what’s changed in the time since many hospitals put up their first 802.11b network. Thanks to Ken for the conversation.

Tell me about Meru Networks.

Meru has been in business since 2002. We produce a family of access points and controllers for mission-critical and life-critical environments. The company is headquartered in Sunnyvale, California, with operations in all of North America, Europe, Asia, and R&D in Bangalore, India. We’re not public so we don’t provide financial numbers, but we’re about 280 people, growing at a very rapid pace due to a lot of industry demand. We’re having a great time trying to respond to the needs and requirements of the field.

The lion’s share of our business is in the healthcare and education markets. In healthcare, we solve unique problems as a result of doing a lot of observation in the marketplace, getting assistance from people, and from our participation in HIMSS. We don’t always go in and talk to the technical people.

We look at the nurse as the integrator. If the technology is going to work, it has to be easy to use and functional to a nurse. If a nurse is using a PDA at the bedside, that person doesn’t really care if it’s the applicaton, the unit, or the wireless network if it fails. We work closely with our clients and our partners to make sure we’re very functional for the clinical staff in hospitals.

What’s the penetration of wireless networks in hospitals and how are they being used?

The actual penetration is close to 80%, but let’s clarify. Many of those deployments are first- or second-generation, with fat access points that are difficult to configure and lots of cost. They also tended to have been installed for a single application or department, like something radiology or oncology wanted to put in. It wasn’t pervasive until recently. Most hospitals report that they have some use of wireless, but it’s not pervasive.

What we see happening is an absolute explosion of applications. Go to HIMSS or trade shows and you’ll see applications and devices using wireless as a transport. There was a time when wireless was nice to have, like in the conference room. Today, it’s an integral part of the architecture and an enabler for taking care delivery to the bedside.

We spent a lot of time looking in hospitals and saw this snowball of applications coming at clinicians, but found that networks aren’t pervasive or are limited in their capacity and are failing. Those first implementations may have worked well for an application or two, but with 15 or 20, they are failing. Adoption of devices is not being as well-received as it could have been with a more robust network.

That has given us a window of opportunity to come in and show how our technology is differentiated in the marketplace. We have better coverage and performance and can prioritize traffic to assure application delivery. Let’s say we have a Wi-Fi based phone and we want to make sure that calls get through ahead of someone in the back room who’s Web surfing. We can inspect that traffic, prioritize it, and makes sure it gets through. We have quality of service built into both the upstream and downstream.

A great application of pervasive wireless that we have witnessed first-hand are nurse-type devices like Wi-Fi based phones or Vocera-type badges. You see clinicians walking the hall with those devices. We noticed they stopped walking. They told us it was because they had a good signal and stopped so they wouldn’t lose it. We’re in the mobility business and we asked whether that makes sense. We’ve seen areas where good coverage was marked on the floor with tape. That’s the pervasive element. Is if through the entire facility? Not yet today. We’re getting there.

Common problems in hospitals include dead zones, slowness, and overloaded access points. How does your technology address those problems?

Wireless runs on a series of channels, usually 1, 6, and 11. Access points have different channels and you roam between them, much like when you’re on the cell phone in your car. That inherently causes problems in your end device because it has to continually look to figure out which one of these guys it wants to talk to. At some point, it’s talking to two of them and has to decide how to hand off.

RF planning is required to determine how access points in a general area interfere with each other. Also, as devices move, they have to decide which way to go. If I’m trying to talk to two different access points to determine which is stronger, that’s taking time on the network. Our advantage is that we can put all our access points on a single channel. The end user device sees it as one big network.

There’s no handoff. We make that decision for the end device in our controller. If you’re walking between 15 access points, that entire campus may be on one channel and you’ll never know it’s happening. The advantage is a four to five times performance increase because you’re not asking questions where to go next. Also, it’s seamless between access points. The opportunity to drop a call or device is almost completely negated.

If you think about what’s happening with clinicians walking down the hallway and looking at vital signs on the laptop and they hit a dead zone, they’ve lost information. We take that away because our coverage is more pervasive. We have quality of service upstream and downstream and we guarantee delivery of those packets for critical devices like a patient monitor or voice call. We can assure the delivery of that piece of information.

This all plays into clinical adoption. We’ve seen the reports come out. In the 100 Most Wired, technology today is having a positive impact on health, safety, security, and mortality rates. Much of that’s due to the deployment of technology solving errors at the bedside, medical conflicts, wrong medications, those kinds of things.

Another key thing we find in hospitals is that they’re amass in assets – wheelchairs, infusion devices, phones. The biggest question is “where are they?” COWS and crash carts move to emergency situations, congregate around nursing stations, and then get pushed into the hallway. We can do some locationing with our management software that lets you determine where those devices are.

Because we’re able to do a single-channel architecture of the standard 12 channels, that gives you 11 available. You can stack channels like a stack of pancakes. You can segment your traffic. As an example, you could put voice traffic on Channel 1, data on Channel 6, and telemetry on Channel 11. That increases your capacity on the network and segments them. They can still talk to each other.

Because we don’t have channel conflicts, when you need more coverage or bandwidth, you don’t need more RF planning. You plug in a new access point, it figures out what’s around it, and it becomes part of the community. That’s a low cost of ownership.

Hospitals spend as much upfront with our competitors doing surveys and channel planning as they do on the actual product. We can almost eliminate that. You don’t need as many of our access points to get the same or better coverage as our competitors. The cost of an access point may be equivalent, but you don’t need as many.

When you look at a clinical environment and recognize that a critical care nurse will take 1,000 data points in a shift and there’s five or six of them trying to do something and they congregate, do they have the bandwidth to get their job done? As they move out on the floors, do they have the quality of connection to get their job done?

Also different is that we have an ability to create fairness in the networks. That offers us the ability to do backwards compatibility. You have the b-rated radios that operate at 11 megabits per second. The g-rated ones are at 54 megabits per second. If a guy comes in to your g-network area with a b device, everybody goes down the lowest common denominator. Everybody gets slowed down because of that guy.

We can give all users their full capacity at the same time. We can offer 802.11n megabits, but still allow g and b clients to work on the same network together. In many industries, but especially true in healthcare, devices stay in service for many years. They’re not going to rip out technology to replace the radio cards. That gives us an extensible architecture and investment protection for existing clients.

Describe 802.11n and what impact it will have on healthcare.

It’s the next generation of speed. It will give you six fold the bandwidth of 802.11g. There’s a lot of technical stuff around that, but from an end user perspective, you’re bringing true desktop wired speed to the wireless world.

Most connections to the desktop are 100 megabits. You’re going to have wireless signals that are three times as fast. If you’re building a new facility, do you need to put those wires in place? You can go to the all-wireless enterprise and have speeds faster than that of the wired world.

In healthcare, most of the devices we see are operating very well at b- and g-rated speeds. Ascom has a great g-rated phone purpose built for healthcare with messaging and made for clinicians. On your hip, the display is upside down so you can read it without using your hands. The next generation of phones will have n-rated radios, so you can have more of them out there.

The biggest impact will be in imaging and video. Today’s early generation networks don’t have the capability to take full-motion video or large images. In a shared PACS environment, you might need to look at large images in real time. 802.11 n will allow you to do that.

How important is wireless voice over IP to hospitals?

We’re seeing it as becoming a much bigger element. They view the network as being able to carry everything. We’re seeing dual-mode phones – cellular outside, Wi-Fi based inside. Doctors look like they have Batman utility belts with 15 pagers and devices. You will continue to see an explosive rate of devices coming down and then a convergence period. Blackberry is coming out with a dual-mode device.

Voice is becoming a much bigger element of these networks in healthcare. In many cases, it’s the driver for upgrades. Then, you get into, “What’s the quality of the call? Is it comparable to toll grade? If a bunch of users make calls, is the network degraded?” We have technology that protects the quality of those calls.

What patient care quality issues can result from ineffective wireless architecture?

Time. Let me go back to the nursing station to see what’s happening. If an application is readily available on a tablet PC, laptop, phone, or multi-use device, you’ll save time. The opportunity for errors is reduced. Where you find a low adoption rate of handheld devices and point of care by clinicians, you find higher error rates. Those have an impact on care delivery and quality of care.

If I’m a hospital CIO, why shouldn’t I just buy Cisco like I’ve always been doing?

Cisco has a great product. I used to work for them myself. But this technology is truly differentiated. When you look at a Cisco product, you have no single product in the top five. You’re not really getting best-of-breed in any segment.

We use Cisco products in our demos. We can make their wireless phones work better than they can because our wireless network is so robust. Our technology is extensible and backward-compatible. There are no forklift upgrades. Once you’re set up, you just stick an access point in the ceiling.

CIOs have multiple vendors and multiple levels of code. With us, you have one level of code that runs all controllers and access points. The controller code is broadcast out the access points. You set a corporate policy for HIPAA or JCAHO or whatever is required. Let’s say you allow a certain number of guests, but you have to keep them away from the business office and lab. You set those central policies and the access points come online, assume those rules, and apply them universally across the network however you’ve set it up. Once you’ve set it up, you don’t have to do it again.

We can also suppress rogue access points. Somebody runs down to Best Buy and buys a D-Link box and plugs it into the wall. Suddenly you have a new wireless hotspot with no security policies applied to it. Somebody in the parking lot has access to your network. We have rogue detection.  We determine it’s there and don’t let that person come in. We go one step further. Once we recognize that the access point is there and it starts to broadcast, we jam the signal. That keeps devices from taking time away polling the access point. I see that guy broadcasting, I’m going to jam the signal so the end devices never see it and can’t take up bandwidth.

How do you justify the cost of your technology to a hospital that already has a wireless network?

Does your existing wireless network have the capacity to deal with what’s coming? Most tell us no. People with a network in place for 18 to 24 months are having to replace it because of the applications coming. They have to put in an extensible one for the next speed or the technology required.

The advantage we have is that most have already come to the decision that something has to change. We come in and say, “We can solve a lot of these problems with coverage and speed and ROI and save you money as compared to the other vendors, and provide you a better of quality of service.” Our value proposition is strong. Clients are feeling the pain by finding low adoption rate by clinicians on new devices. The end user doesn’t know what’s behind it, it just doesn’t work. We try to build the most robust infrastructure at the lowest cost to make sure those applications work.

Cisco convinced HIMSS to create The Community for Connected Health, which seems to be a thinly disguised Cisco trade group that paid HIMSS for exclusive access to its members. Does that make it even harder to complete against the Goliath?

What’s interesting about that … they did that with HIMSS and had tried to do the same thing with the AMA, who pushed back and made Cisco take down some of their marketing. A week later, Cisco announced their endorsement by AHA. Everyone I’ve talked to on the client side and vendor side says this is an abuse of .org facilities and people. The industry is policing that themselves.

I’ve instructed my team to not even respond to those questions because it’s how Cisco markets today, defensively and protecting their ground. Frankly, I’ve talked to folks like yourself who view that as very offensive, “Cisco has infiltrated HIMSS and I can’t believe HIMSS any more.” I think the industry will self-police that. People who have drunk the Cisco Kool-Aid will buy it no matter what. For those wanting a best-in-class solution, I don’t think them doing that with HIMSS or AHA will influence them in making a purchasing decision.

Wi-Fi companies seem to have had mixed IPO success. Meru was considering IPO this year. What’s the most likely outcome?

We are going through a rapid growth spurt. We just tripled the size of our sales team. There have been some successful IPOs, some not so good, some consolidation. The opportunity for us to move forward and grow this company is excellent. There’s a lot of opportunity out there. We have a disruptive technology. I’m sure the company and its founders and its venture funding would like to see us go out. I’m not privy on whether it’s this year or next or whenever, but when it’s time and the market dynamics are correct, I’m sure we will go out.

Any final thoughts?

Our wireless technology is unique. We’re fully standards-based and we help drive a lot of those standards. We’re innovative in our technology. You’ll find that many if not all of our customers are raving fans of what we do. We have very large hospitals like University of Miami, Wake Forest, and St. Johns. We continue to add and grow in this market almost on a daily basis.

We’re something of a positive disruption. We’re getting a lot of positive write-ups and are getting attacked by people you’ve mentioned [laughs]. When we’ve reached the point we’re being attacked by Cisco, that means we’re a thorn in their side and are disrupting their business. That’s good thing.

The challenge is getting the word out. We’re a small company compared to Cisco. We only do wireless. Customers are benefiting financially. I’m happy with where we’re doing. We’re focusing not only on the IT buyer, but how the products are used by the clinical staff. As we well know, doctors walk in with a great application they found or something they use that they want you to support. We’ll see more and more of that. Having a network that is extensible and easy to add capacity to will have an amazing capacity on the IT staff of hospitals and the budget.

HIStalk Interviews Vince Ciotti, Principal, H.I. S. Professionals LLC

August 6, 2007 Interviews 3 Comments

Vince Ciotti

Photo: Healthcare Informatics

My IDN employer brought in Vince Ciotti and H.I. S. Professionals for consulting work years ago (at my urging) and he did a good job. He’s definitely a free-spirited rogue in a button-down world. Maybe the best testimonial to his skill and outlook is that he did all the IT consulting for The Hunter Group, which may have been occasionally reviled for telling hospital executives hard facts they didn’t really want to hear, but who told them nonetheless.

Vince definitely knows his IT history because he lived it and made it. He’s one of those pioneers who hooked on for a ride as the industry got started in the late 1960s, but here he is still working in it nearly 40 years later. Thanks to Vince for the chat.

You and your fellow H.I.S. Professionals founders left good jobs to strike out on your own. What did it take to make your business successful?

We were all fired. You get into consulting because you lose your job. I was fired outright. Bob Pagnotta got sick and tired of taking companies public and dealing with vendors. Karl Sydor had been with SMS and was sick of apologizing to customers. So, two of us weren’t really happily and gainfully employed and Karl had been out on his own. I can’t see many sane people leaving a good job and striking out on their own.

What’s it like working for yourself instead of someone else?

It’s a blast. I spent 15 years before the mast in various positions with vendors. The first 10 years with SMS were wonderful. It’s like Judy Faulkner when your company is hot and everyone loves you. When you get big and it’s a 1,000 person organization and customers get unhappy, it goes downhill.

I went to McAuto and a little in vendor in Brooklyn. I admire a guy who can spend 20 or 30 years with a vendor. I got sick of it after 15.

If you had to take a job with a vendor, who would you want to work for?

At this stage in life, nobody. I’m 62 years old and I’ve got four more years to bag this stuff. It’s fabulous. I’m standing here in my underwear because it’s hot here in Santa Fe. I usually go out on my motorcycle and the come home and take a nap. I’m usually having a drink by 4:00 or 4:30. When I travel, I have to wear clothes and stay up until 6:00.

I’m going to take two weeks off in a motorhome and go to Yellowstone. I won’t make a dime. I called my clients and told them not to call me. I could do it all year if I wanted to. You eat what you kill.

I love it, but to be candid for your readers, don’t jump into it short-sightedly. Bob Pagnotta was the golden man. He was loved as a vendor in the ’70s like Judy Faulkner is today. When he went out on this consulting binge in 1987, he sent out a one-page letter to 27 CEOs he’d served over the years. He said, “I’m sick of the vendor world. If you need me, it’s $1,000 a day.”

He got six responses from guys who wanted a day a week. He was stuck and I picked up the extra day. The power to go out and get those six responses is rare. Without Bob, I’d have starved the first five or six years of the business.

How has consulting changed over the years?

For the worse. It’s bigger. When I started with SMS in 1969, the big vendor was GE, who sold MediNet. They had 500 or 600 hospitals, maybe $40 or $50 million in total revenue. SMS lost money until 1972 or 1973. Vendors were small. Even McAuto had 100 employees and maybe 10 hospitals.

You knew all the hospitals and employees. Those billion-dollar firms today like Siemens and McKesson and Cerner – it’s frightening. It’s a CEO a year. A total merry-go-round at the VP level. Companies buy and sell products like I buy motorcycles. I yearn for the good old days when you knew everybody and they all knew you.

Sheldon Dorenfest goes back 30 years also. He pegged the size of the industry. Probably the total size in 1970 was $100 million and most of that was hardware. Software was embryonic.

In my era of 1969-70, I was an installer and we were free. Can you imagine that today? They called us implementation directors. SMS didn’t start charging for us until the late 70s. It was a different business then. I think it was nicer, but I’m old and jaded, so maybe young kids have a different perspective.

We used punch cards. You sat at a keyboard and punched cards that were sent over lines one byte at a time. When I saw the first CRT – the IBM 2771, I think it was – green lights on a TV screen, no cardboard, no holes. Blew my mind. Typed on a keyboard and it went down the line.

We just had an SMS reunion in March 2007 in Orlando, 50 of the old farts from SMS in 1969. Told old stories. Of those 50, probably 10 are multi-millionaires. They saved their stock. SMS stock was a penny a share when I started and they weren’t public. They gave you 40 or 50 shares for joining and a few hundred if you did well. I ended up with a few thousand shares worth a penny each.

The company went public in maybe 1975 at $15 a share. I’d been given a couple of thousand. It’s what these executives are working for today. Stock options are staggering. It grew and split several times, but I’d sold every share to buy Porsches and Hondas and missed out on probably $1,000 a share. I blew all mine.

What do you see happening in the next 5-10 years with consulting firms?

The ones that go public will have the toughest time, like FCG and ACS. It’s an earnings per share treadmill. How do you grow 15 or 20% a year and still be honest with your client and tell them not to buy certain systems and not be an alpha site? Clients will get angry and then you can’t sell. It’s a vicious treadmill.

A software vendor can come out with new products, charge for them, and make millions. Consultants are “same old, same old”. Help them pick them and install them. How do you get 15 or 20% except by ripping off your client and selling them stuff they don’t need? For a hundred-million-dollar consulting firm, it’s murder.

What are the biggest mistakes CIOs make when negotiating contracts?

Annnouncing a vendor of choice. That’s the biggest mistake. That effectively says “all concessions are ended”. Stupid, like when you meet someone in a bar and look into her blue eyes and say “Let’s get married”. She won’t get married because she thinks you’re weird. You won’t get a prenuptial agreement. On the other hand, tell her you’re going home to a redhead and she’ll do almost anything.

RFPs are a farce. The vendor that lies the most wins. They’re the vendor of choice. You should have picked two winners and then negotiated between the two.

Imagine if your CEO goes to HIMSS and falls in love and tells a vendor he’s going to buy their product and wants you to negotiate deal. How you gonna get a deal? The CEO should tell you he saw some interesting systems and let you lead the charge. Keep the CEO out of the picture as long as you can.

If you’ve ever been a vendor, the salesman’s credo is to sell as high as you can on the org chart. If you can get to the board, do that, but at least get to the CEO. The nastiest ones would try the CFO, and if he wouldn’t buy, he go to the CEO tell him the CFO’s incompetent. You do the same with the CEO if you have to – go to the board.

It’s not the company as much as the sales exec. There are vicious sharks out there that will do anything to get a deal. Glengarry Glen Ross is a classic picture. Getting a guy fired who’s standing in the way of a deal is minor.

Think of the commission check. We just negotiated an East Coast CPOE and clinicals deal worth $40 million. The going commission rate is probably two percent, maybe three percent for the rep, and he’s just the order-taker. The regional VP is probably $100K. The VP of sales, several thousand more shares and maybe a bonus. You’re looking at six- and seven-figure commissions. What would you not do for that? These aren’t immoral or unusual people. They’re just like you and me, but they have far better focus. They’re looking at their W2 every day. We just look at it at the end of the year.

You have a reputation for being an aggressive contract negotiator. Do you have some good stories on things that happened while knocking heads with a vendor’s negotiator?

I hate to print this. The ultimate is that you tell both finalists they lost and you hang up and wait a couple of weeks. They’ll go to the CEO, CFO, CIO or whomever and give them a deal. I don’t care. I tell my clients if you can get more money, do it.

What does it cost McKesson to ship Paragon to a 150-bed hospital in Arkansas? A $2 DVD and a $20 Fedex. Everything else has been expensed in prior years. Maybe you have to buy lots of dinners. Cerner will spend $100,000 on airline tickets. What does it cost to build a Ford or Chevy? Why should hospitals spend 10, 20, or 40 million dollars for these systems?

Meditech’s profit is around 40%. Cerner and McKesson are public, probably in the teens pretax. Maybe the average vendor is 15% pretax, 7.5% after. What’s the typical hospital’s margin? In New Jersey, it’s negative. They pass the hat every year. Well-run shops like Columbia can eke out five percent. How much do you want to give to those poor people at Epic?

You ask to have negotiating session. In come six guys in suits, of which two or three are lawyers. Shake their hand and, they’ll have a caucus on who’ll shake hands and whether they’ll speak Latin or Greek. A wonderful CFO, Paul Long with Hunter Group, would see those lawyers and say, “I don’t have my lawyers. This meeting is over.”

We tell vendors, “Don’t bring your lawyers. We’re businessmen, and if you can’t explain it to us, we don’t want your systems because it will be normal human beings using it.” They want to choke the meeting to death and hope the hospital gives up and signs. The hospital is paying $300 or $400 an hour and they hope you’ll finally sign. Do 98% of the deal, then have a lawyer look over the clauses. If you can’t read and understand it, it’s a bad contract.

For response time, maybe the vendor has a three-page warranty. Rip it up and write it in one paragraph so that everyone can understand. Other than that, it’s legal gobbledygook. You don’t have lawyers on the nurse stations.

We were doing a very big deal in the Southeast. I got a nasty letter from VP of sales to my home address. I had told the client in front of them about trouble we’d had with that vendor in the past – response time, support, things like that. The letter said I was breaching my confidentiality agreement. I have no such agreement. That’s between them and their client. I took the letter to the hospital and showed them. They immediately chose the other vendor. Sometimes life works out like that and the good guy wins.

What hospital or IDN is the best IT showcase you can think of?

Hopkins in Baltimore. Stephanie Reel walks on water. It’s the most demanding job on Earth. She’s got 10 Nobel prize winners, 1,000 academics, and executives who know as much about IT as she does.

Meridian in New Jersey. Becky Weber, a former SMS installer, is CIO. She can make 20-year-old Invision look hot and blow people away when they come for a site visit. She beats up Siemens, but at the end of the day, she does good demos and gives good references.

Sisters of St. Francis. Bill Laker. He had high costs and unhappy users. We did an assessment and wrote a mean report. We said the users were unhappy and he was spending too much money. He went out, talked to users, and figured out they really were pretty unhappy. He looked at our numbers on staff comparisons. Two years of hard work later, he had turned it around, cut staff, cut costs, and improved satisfaction.

I’ll give you some vendor names and you give me some adjectives that come into your head. McKesson.

Interfarce. That’s a combination of integration and interface.

Cerner.

Stock price. Earnings per share.

Epic

Epic costs, with a small E. Very expensive, in other words.

QuadraMed.

Wonderful. Think reasonable cost. We get great contracts and reasonable service. It’s a pleasant surprise when you look under the covers.

Siemens.

They have the best plan of any IT vendor with Soarian. If they can deliver it, if they can code Soarian.PPT, they’ll own the industry. I don’t know how far they are.

Eclipsys.

Pleasant surprise. Nice tradition, that old Technicon tradition. A strong ethic of professionalism from Harvey, who did all the hard lifting at SMS. Nice to negotiate with. They try to deliver and don’t lie too much. They probably tell more truth than everyone. Mike Smeraski is golden if you can deal with him.

Misys.

Past tense. They’re gone. It’s a shame. That makes them the ultimate marketing company – they actually sold themselves.

Medsphere.

Fabulous VP in Frank Pecaitis. May be the best-kept secret in the industry. It’s a small hospital’s chance at an affordable system. exciting interfaces with MUMPS and Cache’, but compared to spending 10 or 20 million dollars that vendors want, that free license and reasonable maintenance could be the best-kept secret.

Meditech.

The army. It’s like a cult. If you believe, you’ll be happy. A lot of young kids out of Boston College. Prices have inched up, so it’s not the deal it used to be. The client server we call “lipstick on  a pig,” because you still get all the old Magic stuff. Everybody does what they’re told. They don’t negotiate. They’ve got almost a six- to nine-month line. They’re almost too successful. I wish they’d go public. I’d buy that stock.

You watched the industry grow up. Who in it has been most memorable?

There’s so many. So many fabulous people in the business.

I’d have to go back to my old buddy Pagnotta. He’s not that famous and he’s provincial. He lives in the northeast and doesn’t like to fly. He can sell screen doors on a submarine. If he wants you to have a typewriter, you’ll have one tomorrow and he’ll show up with ribbons and paper and make you so happy you’ll tell your neighbor, “You have to have one” and they’ll give up their word processor.

Dozens of characters have been stellar in this industry. The combination of selling, marketing, leadership, charisma, honesty, integrity, and morality – it’s so rare. You realize you have to live with these customers, not just rip everybody off and buy an island and be a hermit.

Early in my career, I was a sales exec like the scumbags I’m running down in this interview. I did it with a company that didn’t deliver the product. We sold stuff and it didn’t get delivered. I moved on another vendor, another vendor, then became a consultant. Three years ago, I went back to that same large multi-hospital IDN where I had sold a non-existent system 25 year before and they had lost all their millions. I started with the executives. The CEO, CMO – it was the people – they hadn’t moved. I had had a nice dark brown beard, but I had shaved it off. They started telling me about those terrible scumbags that sold them the nonexistent system that cost them millions. Sweat started running down my nose, but they didn’t recognize me. That’s the industry. I was a scumbag, and now I’m a consultant hero. We play different roles at different times in our careers.

You’ve been reading HIStalk for a long time. Give me the pitch you’d make to attract new readers and sponsors.

It’s more of the truth than anywhere else. You have the guts to put it in print than the mealy-mouthed magazines. They always edit out the name of the vendor and that destroys the article. You name names and tell the truth – that’s priceless.

Any last words?

Since I’m a consultant, I’ll advise readers to beware of them as well as vendors. Negotiate with them as strongly as with vendors. They’re getting a free ride, sometimes taking more millions than the vendor. Consultants should work for thousands of dollars, not millions, get projects done in months, not years, and work themselves out of a job and not stay forever and suck the place dry. Get your expert advice, thank them, and show them the door. Don’t let them become your partner and run the hospital for the next 10 years.

HIStalk Interviews Cindy Dullea, SVP of SCI Solutions and Rear Admiral (Select) of the United States Navy

July 9, 2007 Interviews No Comments

I only knew Cindy Dullea as my sponsor contact at SCI Solutions. We swapped the occasional e-mail about advertising reports or graphics, that sort of thing.

Memorial Day of this year, I made my usual “fly your flag in honor of service men and women” pitch in HIStalk. Cindy e-mailed her thanks for that comment, confiding that she holds an additional role that she doesn’t talk much about. Cindy is Rear Admiral (Select) of the United States Navy.

Of course I had to interview someone that interesting and accomplished. Thanks to Cindy for agreeing to be interviewed (and for her service to our country, of course).

Let’s start with your civilian career. What do you do for SCI?

I am the senior vice president of marketing. I’d been with John Holton in the original 25 folks that started Scheduling.com in 1999 as VP of marketing. It was a great opportunity for me to create a brand and launch something from the ground up. I have an MBA with an emphasis in healthcare marketing and information systems. I had the opportunity to create the brand now known as SCI Solutions.

I left in 2002 and came back two years ago when John bought the Efileshare product. John and I had lunch together and it was a really great time to bring me back to re-brand the organization and figure out how to put the Scheduling.com product and Efileshare product names in perspective. We looked at that for seven months and re-launched about year ago.

I do all things marketing as well as being a nurse by background. I do a lot of client relations things, visiting clients and understanding how they use our systems, using my healthcare consulting background to see how they can improve their use of our product line.

What’s new with the company?

We have lots of new product functionalities coming out with Order Facilitator and our scheduling products. We had a record quarter last quarter in sales. Things keep getting better and better. We have wonderful ratings in KLAS. I couldn’t be more pleased, as I know John is, with progress of the company, from ratings to sales. We’re on a roll and have great momentum.

How does working for a relatively small HIT vendor compare with the big ones you’ve worked for?

It’s an opportunity to work, first and foremost, with some really bright people who have been around the company for awhile. In big companies, you get siloed and may not know what the division or department beside you is doing day to day. In a small company, you rely on each other. We’re all in it to make the company better. We’re high energy, multi-tasking types of individuals who are happy to step outside of our bounds to help the overall company and the individual departments meet our goals.

I like to multi-task and to be a part of multidisciplinary teams and high-energy team efforts. We can accomplish this by being very virtual. Of our 65 employees, over half are virtual, working from home offices. All our sales and marketing as well as implementation employees are home-based.

As a vendor marketing executive, how do independent blogs like HIStalk fit into the big picture?

We at SCI think it’s great because it gives us an unadulterated view of what going on in the industry. Most, if not all, of our executives read HIStalk. It gives us an idea of what the target market is thinking.

In the beginning when I came back, my group was focused on how to take the SCI Solutions brand and make it better to reintroduce it. We accomplished that in terms of creating marketing collateral and so forth to support the deployment of the new brand.

We switched over and said, “What are we doing for sales lately? How are we going to help our salespeople prospect better?“ It’s hard to fill your funnel and tool chest with qualified prospects to talk to. We said, “Where will we focus our marketing activities to help our sales organization?”

We became a prospect marketing organization. We looked at ways to do that and where to focus our advertising dollars. HIStalk was #1 on our list. That’s where the majority of the healthcare arena will get their information, not from reading trade journals. There’s no bang for the buck there.

We do Webinars, go to trade shows where buyers will be, and focus on getting clients out there speaking. We do a number of activities, but we advertise only in two places: HIStalk and on the NAHAM [National Association of Healthcare Access Management] website. That’s it.

You’re a board-certified informatics nurse. Is that a career path you’d recommend?

Absolutely. It has really caught on the past five years, especially among those nurses who have been at the bedside for 10+ years and can take their knowledge of how care is conducted to the information systems piece. It’s a great career path that’s catching on. CARING [a nurse informatics organization] is an organization that has grown tremendously.

Tell me about your military responsibilities.

I’ve been Navy nurse for over 27 years. I spent 3 ½ years on active duty as a full-time Navy nurse. I got off active duty, spent four years in the inactive Reserves, and have been a weekend warrior for the past 20 years.

I was just selected to be the next Navy Rear Admiral for the Reserve Nurse Corps. I’ll put on my star October 1. It was just confirmed by the Senate. It’s a done deal now [laughs]. I guess they found nothing bad in my background.

I’ll be over 4,000 Navy nurses, both active duty and reserve combined. I’ll be the #2 admiral over them. A two-star, full-time admiral is the #1. I will be there depending on the needs of the Navy. It could be up to 180 days a year on active duty. That’s one part of my Admiral job.

I’ve also just been named the Deputy Regional Commander for Navy Medicine National Capital Area. Navy Medicine is divided into four regions, each with a commander over Navy hospitals in their region. The National Capital area covers the National Navy Medical Center in Bethesda, Great Lakes Naval Hospital, and several others.

What are your responsibilities?

That’s unknown for me at this point. I believe it will have some level of governance over all components of Navy Medicine in the Capital region.

It will probably involve the integration of Walter Reed with Bethesda, which has lots of moving parts to think about. It’s no different than when two health systems merge. Beyond who has which toy and who does what, the cultures are different. It’s all military, but each component truly has their own culture, and with that comes small details. A Navy Corpsman is not the same as an Army Medic. Training is similar, but their patient care duties vary. How do you handle that on a patient care ward? You start going through the building blocks to bring the cultures together.

The Navy Surgeon General is the top doc, the top Navy person for Navy Medicine. The Surgeon General is a three-star Vice Admiral, the only three-star in Navy Medicine. I had the opportunity from 2000-2003 to command a unit at Navy Medicine headquarters that reported to the Navy Surgeon General. My unit worked with the strategy and goals of Navy Medicine. Everybody reports to the Surgeon General. I was probably closer because a lot of what we did was under the direction of the Surgeon General and his top team.

Is your military job affected by politics and bureaucracy?

Oh, yes [laughs]. Any time you get in a big organization, especially one that tries to stay apolitical, there’s always politics involved. Nothing happens with Navy Medicine unless it’s at the direction of someone pretty high up in politics. For example, we can’t just decide that we’re going to deploy a hospital ship when a tsunami hits. The Navy Surgeon General can’t just send out his big white ship. It has to come from Congress.

Do the armed forces do a good job taking care of soldiers?

Absolutely. There is nothing even comparable to the military’s ability to treat combat casualties. We’re seeing casualties in this war unlike anything we’ve seen in wars past. Service men and women who would have died in Vietnam and maybe Desert Storm I are living. We get to them quickly, stabilize them, and move them to Landstuhl, Germany. That’s great.

I think our challenge in the military arena – and probably Walter Reed has felt that more than other services – is post-critical time of care. One of the things we’ll get really good at doing is case management. What happens when you release that service man or woman from your facility back to their communities or bases? Each service does that continuity of care differently. Some hiccups have to occur. We’re learning from it. I’m convinced everybody knows that long-term case management has to be done very well.

You helped design the Navy Reserve’s personnel deployment system. How does it work?

It used to be that all reserve medical personnel came under the authority of big Navy Reserve, which owns every Navy Reservist. They were great at administratively taking care of us, but when it came to mobilizing us, they fell short because they didn’t understand the idiosyncrasies of physician and nurse specialties. You might be a med-surg nurse, OR nurse, or ICU nurse. You have to know what kind of nurse.

In 2000, the decision was made that the big Navy Reserve would pass over the day-to-day authority and operational control of Navy Reserve Medicine to the Navy Surgeon General, who would own his or her own assets, including reservists as well as activity duty. They had a better picture of what I call part-time staff, those several thousand reservists. We built MEDRUPMIS, which gave us the ability to drill down into fine detail about each reservist – corpsmen, nurses, doctors, dentists, and medical service corps. We could see not only what they were and their designator , but also see down to the granular detail, like the doctor is a board-certified orthopedic surgeon and is credentialed to practice.

We did a search query capability. You can pull up all med-surg nurses in a list of states and tell a military treatment facility like Bethesda how many med-surg nurses are in their area that they might be able to mobilize or have come in for their annual two weeks of training.

We were scheduled to do a Beta test scenario in which the hospital ship USNS Comfort was deploying for an emergency and we had to backfill Bethesda. I was there on September 11, 2001 as the senior officer, watching the screen as it matched requirements. The planes hit the towers and the Pentagon. What was supposed to be the Beta test became reality. We used the system, not knowing if would work to backfill 250 staff into Bethesda for staff deployed on Comfort to New York. Since then, it’s been used to mobilize for tsunamis and into military theaters around the world.

Having seen clinical information systems in both the military and private sector, how would you compare the two?

The commercial clinical systems are much better than what started out as CHCS I, created by SAIC and now AHLTA or CHCS II. I would say that some of our in-theater product lines are very good. Where the military is still lagging behind is in looking at those civilian systems and trying to understand, building on something that’s reached its life cycle, to see if there’s something out there. Systems aren’t building that EMR that we need to get to in the military. The case management aspect and knowing where service men and women are going will play into that.

What military leadership practices do you use in your job with SCI?

I absolutely give credit where credit is due. I wouldn’t be where I am today without the military. First and foremost, it’s understood early on the military that, as you move up into additional ranks, you are expected to take on increasing levels of responsibility. That taught me not to fear taking on bigger and better and more complex issues.

The military allowed me to lead not only small groups as a junior nurse over maybe 20 people, but up to 700 people over six states. It challenged me to think outside the box, to redefine my leadership skills, to try to not be afraid of trying different things and giving myself permission to fail.

I’ve taken those fundamental thought processes to SCI. John Holton lets me do that, strategizing what I want to do. In some ways, it’s very much like senior officers I’ve worked for in the military, using him as a sounding board. I enjoy that collaboration.

There’s much more organizational structure on the military side. Everything is extremely chain-of-command oriented. You wouldn’t pass over your immediate supervisor to get to someone else. When I come back from military duty, I have to think about which environment I’m in. I can be more relaxed and open about what I can say. I’ll use acronyms and John will tell me to stop [laughs].

You’ve known a lot of people in the industry. Which ones were most memorable?

I certainly would say, on the military side, I had opportunity to work for Vice Admiral Mike Cowan, who I understand is now CMO for BearingPoint. I learned a lot from his style. I’ve worked with John Holton twice, so there’s a testimonial there. Steven Russell from QuadraMed gave me my first break in the industry back in 1992 and hired me almost sight unseen, setting my path at Compucare for the first five years.

There have been lots of great people along the way who have allowed me to do different things. On the Navy side, Chip Rice, president of the Uniformed Services University. And, his chief of staff, Steve Henske, who was my commanding officer 12 or 13 years ago. I was selected as his #2 person, his Executive Officer, which began my leadership movement in Navy Medicine.

Any other thoughts?

I’d like to give a plug for any healthcare professional who has considered looking at a career with the military. For those who are patriotic, who want do something for our country, and who have the skill set, I’ll give a plug for the Navy Reserve.

For me, one of the most enjoyable things that I cherish over the last 20 years as an active reservist is the quality of the people I meet. Wherever I go, I’m in awe of the types of people who are out there and who set aside their lives for two days a month and two weeks a year to do something for the military. Some of them are health system CEOs or senior consultants or nurse anesthetists in business.

It’s incredible the kinds of folks I’ve had the chance to meet and get to know. If you’re looking for a new challenge, I would highly encourage you to consider service to your country. It’s a great opportunity and there’s a lot of self-satisfaction that can come with it.

I’m very blessed in that I’ve had the opportunity to have this alter-part of my life and able to maintain it, thanks to lots of folks who have supported me along with way on the HIS side. I’m blessed to be able to maintain both sides. I’m honored that SCI Solutions and its employees have been supportive. More importantly, when I speak with them, I feel there’s a lot of respect and a celebratory feel that it’s cool that I’m one of them. It’s like family at SCI.

HIStalk Interviews Michael McNeal, President and CEO of Emergin

June 20, 2007 Interviews 1 Comment

Michael McNeal

Michael McNeal takes messaging seriously. Maybe you think of messaging as the mundane transmission of old fashioned analog signals from medical equipment, the boring stuff that only a screwdriver-wielding engineer could love. Michael and his company Emergin see messaging as strategic and mission-critical for hospitals. As a result, they’ve incorporated some cutting edge architecture and deployment ideas into their services for hospitals. It’s another formerly separate discipline that’s starting to look a lot like IT.

Hospitals buy a wide variety of message-capable equipment, often with little planning. That’s like cherry-picking favorite individual department IT systems with proprietary interfaces, with little regard to workflow changes, integration, impact on patient care, and optimization. That’s what Emergin addresses: architecture, deployment planning, and tying event notification and alarm management into strategic goals. Quite successfully, as it turns out, as the company is growing at a torrid pace after pretty much defining their own market segment.

HIStalk reader Art Vandelay mentioned Emergin in an article comment right after HIMSS, which is what put them on my radar in the first place. His description of their market is a lot better than I’d come up with, so here’s what Art said: “Emergin has a dynamic CEO and a great vision. If they’d only build a better biomedical data integration mousetrap – a la CapsuleTechnologie, they could set the world on-fire. Everyone in IT, the tsunami on the horizon is integration with biomedical devices and intelligent building technology (as opposed to letting these technologies persist on their own, poorly secured and sometimes poorly supported and utilized, with a few bridge-points spanning networks). It is time to hop into the boats and meet the wave rather than get over-run. We all want discrete data in our medical records systems, these devices generate more than you can imagine and it is a huge win with people who are in your hospitals more than the physicians. Emergin has a well-thought-out profile / use case for biomedical alert integration that should be in every mobile telecommunication and device request for proposal you put out. They also share their information in a brilliant guerilla marketing technique to entrench their product in the industry.”

Good intro, Art. Thanks for Michael for taking the time to chat and to Kathy McCall of Emergin for making the arrangements.


Tell me about the company and yourself.

Emergin was founded in 1995. The name derives from emergency and innovation. Since inception, our focus has been on emergency, real-time information as well as innovation, breaking new ground in new markets with a heavy emphasis on healthcare.

After graduating from the University of Florida as a computer scientist, I worked at IBM on operating system design. Above getting a comprehensive OS background, it helped me recognize the importance of governance structures in organizations, working on a team of up to 4,000 people architecting components into a single OS.

Hospital alarms used to be hard-wired, proprietary, standalone, and connected only to a desktop system or audio alert. How has that changed?

It really hasn’t changed. We’re hopeful that Emergin will be the driver of that change in healthcare. Most hospitals still buy monolithic, discrete systems. Phase II or III is workflow and optimization. We’re trying to get hospitals to think more strategically about planning and design. Healthcare hasn’t really changed that frequently.

We flew around the country over three years to really educate the hospitals on SOA and IT architecture in general, how they can be thinking differently about controlling their own destiny, focusing on work process design, human factors, and performance management.

We’re working strategically with customers, thought leaders like Texas Children’s, University of Chicago, Cedars Sinai, Memorial Sloan-Kettering, William Beaumont, New York Presbyterian, and Boston Medical Center. We need to work with them because it’s not one size fits all in the early innovation stages. We’re looking at alarm patterns, message discrimination, and improved patient safety.

The only problem is that there’s no category for Emergin [laughs]. We’re creating a market around of a category of alarm management that doesn’t exist in the US market.

The company has promoted and sold into a number of industries. Manufacturing, with Six Sigma and Lean. Aviation and the FAA. Government agencies like E911 for broadcasting of critical events. It’s the same business models being applied to healthcare market.

We researched the market six years when we decided to focus on healthcare. We realized that there were many discrete systems but nothing to orchestrate them all. Add on top of that the ability to create governance structures or committees or how to orchestrate nursing, IT, biomedical engineering.

How do you pull it all together into a master technology plan? You start out with a clean sheet of paper, a governance structure such as committees, and then build an architecture. Get representation from all departments to get everyone on the same page. Then, build around the hospital’s key strategies, like patient safety or financial performance. When departments and budgets are decentralized, departments choose their own technologies, which create fiefdoms. Then it becomes a battle to see who has the most power.

We’re taking it to next level, building IT architecture, mapping traditional alarm systems into medical architecture with a focus on workflow and performance management. I just received the initial alarm reports from Texas Children’s today. We’re assembling them to look at the rate of alarms on physiologic monitoring alarms, nurse call systems, IV pumps, and how effectively that info is being communicated to the nursing staff.

Do you have an example of what you do?

A example is William Beaumont. We visited their facility, then did an inventory of systems. We asked questions of IT about how they perform certain workflows. We put together a bunch of questions to ask care units to determine whether there was consistency in workflows. Often you’ll find that IT organization will claim that workflows are consistent until they do the research. We designed tools for them to collect the information and then give us the evidence of what’s happening. Hospitals also do research of individual systems, common nomenclature for bed labels, or staff classification or alarm categories.

What that uncovers is that they don’t really have a plan to drive the standards. They’re governed individually. Emergin created templates and tools to set standards and architecture to drive conformance over time. It’s easiest to go into new construction or renovation, but in many cases hospitals are retrofitting existing systems. When they realize how painful that is when there aren’t standards, they’re more apt to do it at the beginning of any new deployment.

Much of that isn’t tools, it’s a workshop. We meet for half a day with nursing and talk about workflows, care models, and response to alarms. Then, half a day with IT for education on service-oriented architecture  An issue that IT has is that they’re typically responding to capital equipment already purchased. Someone’s already bought physiologic monitoring and needs to get IT involved. When IT isn’t involved upfront, workflow changes aren’t uncovered until implementation. They may need network changes, interfaces, or workflow changes.

We’ve gone through 1,000 deployments with 200 best-in-class systems. Emergin has learned in six years how to do technology lifecycle management and change management. We understand that when you’re planning or designing your architecture and third party systems, you have lots of things to consider. Most hospitals won’t consider process flows from the beginning.

Maybe you’re sending an RFP for a nurse call system or IV pump system. Each monolithic system is being deployed. There’s no real consideration of workflow until afterward. All of a sudden, nurses are carrying four or five devices or entering the same data into three or four systems. That creates workflow challenges for nursing and frustrates them because they want to spend time at the bedside and technology makes it more difficult.

The next phase of electronic medical records seems to be the incorporation of digital device information. How does that fit in with your focus on alarms and events?

Most of the technologies are used to import information from data from medical equipment into EMRs for charting. Emergin’s value proposition is around messaging and notification, within five seconds for an emergency. Our core technology is the Emergin Enterprise Service Bus. For the mobile worker, which is 90% of caregivers, getting information is critical for patient care and safety. The EMR will collect info to record it as part of the patient record, but it’s traditionally a data repository for that information. Some EMRs can trigger rules or events, but not usually real time in five to 10 seconds.

What do you think of the work of IHE?

They’ve just created a medical device subcommittee of IHE. Some of our customers are part of it. They’re trying to drive some standards around how medical devices interface alarms and events. We were invited last week to help work on those standards.

IHE started on cardiology, pharmacy, and lab and is now expanding into the medical device domain, which we consider our core competence. Because we’ve integrated a lot of the medical equipment, we’ve created a standard integrated profile that we’d like to make publicly available. Some customers are including those specs in their RFPs. We’ve found that interoperability, not to overuse the term, is normally not considered until Phase II, III, or IV of a deployment cycle. We’re trying to coach hospitals to include it in the initial acquisition. Maybe not in the Phase I deployment, but interoperable by design.

Failure to rescue is an often overlooked phenomenon.

That’s the core area we’re focused on. We’ve done tremendous amounts of FMEA studies and are involved in clinical trials with medical equipment manufacturers. We’ve found that failure to rescue is often because of communication errors. We’ve built the ability to trace back on patient activity when the alarm was generated, who it was assigned to, which system, which device, who read it, who acknowledged it, and when the caregiver responded. By integrating with systems, we can produce an RCA transcript that can re-create life cycle of a patient alarm.

In the years of workshops, we were often asked about how long does it takes to do an RCA. It’s six to eight weeks with a reliability rate of 40%. 60% of the data was anecdotal. Hospitals couldn’t recreate the incident to avoid having it happen again.

I co-presented with Darren Dworkin, CIO of Cedars-Sinai, at HIMSS. A network engineer stood up in the audience and said he didn’t really understand the clinical domain, but said if he couldn’t find network problem or security breach within 15 minutes, he’d be out of a job. It takes six to eight weeks to find the cause of a patient’s death? That’s a great question. It’s a very interesting analogy.

Is alert fatigue and false alarming a problem?

Part of the Texas Children’s study is measuring the amount of false alarms. A key part isn’t just technology or relaying of an alarm, but looking at its impact on vigilance, what the fatigue lines are.

That’s another common workshop question: what’s the fatigue line for a 12-hour shift? No one could answer. Texas Children’s is writing an AHRQ grant for further research over three years. They’ll study the rate of alarms on a per-care-unit, per-patient basis. How many alarms can be physically handled during a shift? What’s considered an adequate staffing level to provide care?

Texas Children’s is also studying by system and by vendor and looking at trends. They recognize that, in a population of 12 patients, two patients generate over 80% of alarms. When you do staffing levels and look at what causes delays in response, which is unmeasurable in most hospitals, what is their average response time per patient? If they have two simultaneous alarms, what impact did that have on the second patient? You have to measure failure to rescue to determine response.

Hospitals struggle with throughput. What systems can improve that?

A Stanford graduate wrote about complex event processing. How do you know when certain things hit thresholds, like ED at capacity or census at capacity, and then do just-in-time management? Emergin is studying this as well. We started out with life-critical alarms — V-tach, asystole, or apnea —  and expanded beyond that to look at other critical events, such as critical lab results, getting them to caregiver, and having them call back receipt. As you’re looking at bed turnover and dirty beds, how do you streamline the overall operation to effectively respond?

When Emergin looks at an enterprise, we look at any input event and output event as discrete units, whether from physiologic monitors, nurse call or lab system, EMR rule, ED capacity alarm, or RFID alert if an infant leaves a certain zone, Emergin can take that data from discrete systems and take action on it, delivering it to whatever device is appropriate, such as a Cisco or Spectralink phone or Vocera badge. Some departments use LED signs in the hallways for real-time status updates. Doctors may have a RIM Blackberry, Treo, or cell phone that is their preferred device. How do you orchestrate these devices that carry events?

What are some creative uses of alarm systems in hospitals?

The pneumatic tube. If sample is sent and the tube gets stuck, it alerts the biomed department. Or, the Pyxis machine hits a threshold number of meds that need filled and only two pharmacists are working. We can alert the director of pharmacy to pull in more pharmacists to make sure they meet SLAs. Or the blood bank. If the temperature goes above or below thresholds, then notify maintenance. Customers generated these ideas.

How important is service-oriented architecture to your products?

We were hired by Motorola in 1996 to become the architect of their next generation platform called Heir Apparent. We’ve been SOA-driven since Day 1, a core messaging and notification engine with service adapters that became the interfaces to third party products. As the platform evolved, it enabled Emergin to continuously evolve and add more systems to its architecture without changing the foundational architecture over a 12-year period. We went from zero integrations to over 200 because we build a service model from Day 1.

There’s a lot of hype talking about SOA, but you’ll find that most companies that are doing it are in middleware, traditionally in logistics, financial services, and manufacturing. It hasn’t been applied well in healthcare. To build true SOA is to take a step back, study the inventory of systems acquired in a hospital over time, then build reference architecture, plugging systems into it, then looking for ways to increase operational efficiency.

SOA is a foreign concept to most hospitals. We’d ask, “Who’s the most important person when you build a house?” The joke answer was always the wife or general contractor. Often, no one thinks about the architect as the most important person, even though they build the plan and design. That ensures that when you build a bedroom or bathroom or kitchen that you’re using the same plumbing and electricity for economy of scale.

Think about the blueprint from Day 1. If hospitals step back and build an architecture, figure out how systems fit into it to ensure that you’re not buying the same components over and over. You’re able to leverage some of the systems that you’ve already purchased. When you have a core engine like an enterprise service bus, there’s certain user functionality that should be part of the core engine and not the individual systems you attach to it or you’ll duplicate job functions.

What involvement should CIOs have in alarm systems?

When we first kicked off the workshops, we thought our target audience was the CIO. We found that getting a CIO to spend an entire day to learn about SOA won’t happen. Later, we changed it to IT directors, biomed directors, and nurses moving into informatics. We fund that the IT director was the right audience, the right-hand technical gurus to the CIO. The CIO is more business-minded, with a holistic, vanilla operational focus. They don’t need to know details, they just need a team who knows details.

We found that when training directors of IT, they can translate language to the CIO and demonstrate the importance. We thought the CIO would be the strategic eyesight of the domain and would have to pull it all together, but we found that you have to speak different languages. Nurses don’t understand techno talk, but when you talk about care models and workflow and patient complaints, that’s what they related to. With IT or IS, we talk about networks and servers and databases and how systems interconnect. For biomed, it’s medical equipment, maintenance, and how they’re deployed and used. For facilities, it’s fire alarms, security, blood banks, and pneumatic tubes.

How do you get all those audiences with domain expertise on the same sheet of music? The workshop accomplished getting the group together for a common vision. SOA explains everyone’s responsibility for the architecture as it relates to their job functions.

Emergin was just named to the Healthcare Informatics 100 and one of Deloitte’s fastest growing technology companies. What are your goals going forward?

To continue accelerating our growth rate. We’ve had 70% to 75% for past three or four years and we’re still shooting for a triple-digit growth rate. We will probably hit closer to 80% this year. Those are ambitious goals. We’ve worked hard to build a market. We focus on customers. Doing the right thing has really helped us not only sustain the company, but build a solid brand recognition to set us up for phenomenal growth in years to come.

Most companies are happy with a 30 or 35% market share as a market leaders. We’re taking the Cisco approach. We don’t just want to be market leader, we want to set the standards.

As far as competition, there’s not much out there. We’re finally working with certain reporting organizations that are creating alarm and event management as a category for the first time. Joint Commission had written the effectiveness of alarm systems into one of their National Patient Safety Goals in 2006. Because there weren’t any vendors that could achieve those goals for hospitals, they removed it. We would suspect that after publicity from Texas Children’s and Beaumont, it could be written back into the charter and will fuel demand.

Your a technical guy. Are the skills you need to run a fast-growing company a lot different?

I’ve learned quite a bit on the job and I’m an avid reader. I’ve read about great companies, business leaders, strategies, leadership, marketing, and sales.

I’ve taken an interesting path from computer scientist to product manager, looking at business models and market segments for what we want to build, then putting the pieces together. My passion is getting more intimate with customers and leading sales and marketing initiatives for the company. It’s a unique transition for someone technical to grow into the business side.

Through the transition, I’ve recognized that hiring the right leaders, administration, and the engineering and services group really freed up my time to focus on sales and marketing. It allows me to spend every single week with customers.

When you look at personality types and skills, I’m a visual mathematician. I can take complex patterns and figure out formulas.

With the complexity of healthcare and the vendors in the ecosystem, we can help hospitals put a strategy together. The more you listen to customers and have them drive your roadmaps, the more successful you’ll be as vendor.

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