HIStalk Interviews Tom Yackel

Thomas R. Yackel, MD, MPH, MS is chief health information officer at Oregon Health & Science University in Portland, OR.

Tell me about your background and what you do.

I’m a general internist by training. I continue to practice outpatient and inpatient medicine about 30% of my time, but 70% is in a relatively new position here at OHSU called chief health information officer.

I started out at informatics. I actually came out to Oregon to do a fellowship with Bill Hersh in medical informatics, one of the National Library of Medicine fellowships. Did that for two years, got a master’s degree, and then was lucky enough to stay on at OHSU.

At the time, we really weren’t doing too much in health IT. We had Siemens Lifetime Clinical Record, we had a scanning system, and so we had a pretty good repository, but we weren’t doing any CPOE or anything really challenging or interactive.

After I was here for about two years, the medical group got interested in EMRs when they were building a new building and realized that record rooms would cost too much per square foot. That really kicked off our adventure into enterprise electronic health records.

I guess six years or so later, here we are and we have an almost fully-deployed enterprise electronic health record and the full suite of Epic applications; including e-prescribing and MyChart, and rolling this out to affiliates and all the billing and scheduling and good stuff that goes with it. Reporting, too. It’s just been kind of a neat and fun ride.

How important do you think it is for your credibility that you continue to practice medicine?

I think it’s important for a lot of reasons. Credibility, I think, is one thing, just in terms of making contacts with people outside of the context of the EHR is super helpful to me. Having some people actually come to me as their patients, who I also work with, is kind of an honor and something neat.

I don’t know how other people do this if they don’t actually use the system that they work with, but I would have to spend a lot of time learning a lot of details that you just kind of learn as a user. So I find it immensely helpful and fun to continue practicing.

What are the most important lessons you learned from the Epic rollout?

You pretty much have to do everything right. Health IT is not fault-tolerant, in terms of big projects. You really have to get all the ducks in a row in order to be successful. There are some exceptions to that you make and do better at some things versus others, but I think you really have to cover all your bases to keep the thing moving forward. It’s an uphill battle to do it.

Truthfully, a lot of it is attention to detail. Details are critically important in this. Keeping an eye on those details, making sure all the ducks line up, and trying to acquire the best talent that you can. People that appreciate those details that have a passion for doing informatics-type work. Pairing up with a vendor that shares that same attention to detail and understanding that you have, to get everything right in order to be successful, that has smart people.

Having leadership/ownership buy-in to everything that you do is crucial. We don’t implement health IT for health IT’s sake, we implement it for health systems’ sake. Getting executives behind that and understanding they need to understand a lot of the details too, because sometimes you look under the hood in health IT and it’s a little bit frightening what you see under there. They’ve got to be comfortable with that and be there to back you up when things get tough.

How is your project structured, in terms of ownership, and how did IT fit in the mix?

In terms of the rollout, IT was the project. I don’t want to say ‘owner’, but maybe we’ll say ‘steward’. We organized everything around IT. Once the project was done, we delivered things back to operations. In places where we didn’t have an operational owner, we created one.

The interesting part of this whole project was that initial kickoff. It was our medical group that actually wanted to do this and put up the money to do it. It was the physicians actually paying more than half of the cost. That was instant ownership for them.

Then we organized around IT for the project and for getting it rolled out. When we were done, really wanted to, again, turn the keys back over to the owners and say, “This is your tool, and now it’s yours to use and IT is here to help you.” In the places where we didn’t have an owner, we created one.

As chief health information officer, what I oversee now is a new department called the Department of Clinical Informatics. That group was created because as we sat around the table figuring out OK, now that we’re done, what goes where, we realized there was no owner for all the workflows that we had created in the EHR. There was no group that fronted the customer to IT, or owned the institutional organizational issues that basically came to light as a result of the EHR. So, we created a new department for that.

We also created the Department of Learning and Change Management too, because we didn’t have an operational institutional owner for projects of this magnitude and the ongoing training and change management that would be required for it. That was kind of neat because all of that bleeds out beyond just the EHR and you realize, “Wow, having an informatics department is helpful not just for EHR, but for things that you want to accomplish with electronic systems, or when you need to organize people together around an electronic system to make something happen.”

Likewise, in the learning and change management department, there’s operational changes that may be somewhat enabled by IT. But really, now you’re teaching people how to do their job differently. Not just the new tool, but really do what they’re doing differently, and then how to use the tool to do that. To achieve quality objectives, for example. That’s been kind of neat to watch.

The Department of Clinical Informatics, does that cover just the practice side or the whole facility? Also, what’s the structure and composition of that group?

It’s the whole, what we would call ‘OHSU Healthcare’. It’s both ambulatory and inpatient. It’s multidisciplinary. My title, chief health information officer, was chosen … we didn’t want to make it a chief medical information officer. We didn’t want to create separate silos of medical informatics, nursing informatics, etc. Put it all under one umbrella.

I have two roles. One is this operational person who has this department that I oversee; but then also, I chair one of the four subcommittees of our professional board, our governing structure. We’ve got four subcommittees: safety, quality, operations, and the new one, informatics. People really recognized how important informatics was, and that it really stood up against all those other things that we needed to work on.

In the informatics department we’ve got a director. Then underneath that we’ve got three main groups. One is our clinical champions: physicians, nurses, pharmacists, etc. that work on the project. Our entire HIM department, including coding, was brought in as well.

Then we’ve got a group that came from IT. The systems experts — people that were involved with workflow, design, clinical content creation, and reporting  — all came in as well. We created this team to try to make sure we had people covering the entire lifecycle of project changes and implementation, delivering stuff to users, and reviewing the contents of the quality of the record, which is obviously an important task for HIM.

That’s probably a bigger scope than the average CMIO, or even IT department, to have all of HIM plus the functional IT people. Was that difficult to sell, clinically?

I should point out that we also have about a dozen people that came from IT, and yet we’ve still got our whole IT department which is separate from us. We’ve divided up the responsibilities where we’re more content-oriented, we’re more workflow-oriented and we front the customer. So, we’re the ones that run all the subcommittees of the professional informatics board to figure out OK, well, what are the requirements that people need? How do we prioritize projects?

Then the idea is that we hand off to IT well-spec’d out details of, “Here’s what we need the system to do”, or “here’s what we need built”, or “here’s what we need you to work on with the vendor so they can do their IT role and not get too bogged down in trying to figure out what does the customer really mean when they say, we want this.”

But I think you’re right, in terms of the HIM part of it and really seeing HIM as  now part of informatics. I don’t know that everybody’s doing that, but we thought it was crucial. I think HIM is the glue that holds your record together. They’re the ones who are charged with doing quality reviews of the record.

People complain all the time, “I don’t like the record. I don’t like the notes. People cut and paste too much.” HIM oversees that. They have a huge role in scanning, and scanning’s another piece of glue that keeps an electronic system together because we’re still in a paper world and we interface a lot with paper systems.

Then coding, too — we create clinical content in informatics. The doctors use it, and then the coders read every single thing that they create. It would be a missed opportunity if we didn’t have the coders able to talk to the people that created the content in the first place and say, “Hey, I’m noticing people are using this well” or “They’re not using it well.” Or, “We could do a better job in our templating to accomplish our documentation requirements.” That’s how we thought about it when we put it together.

When you started the project, I’m sure you had some metrics in mind to measure before and after. What kind of measurements have you done, and have you seen the results that you had hoped to?

Looking back, I always feel like we could have done a better job with metrics; and also recognize that a lot of the things that you’d love to know when you do this, you never measured before. We looked at some of the standard things, and a lot of times, the data that we had.

I think one of the most easily available metrics that we had was our dictation. We were dictating pretty much 100% for all outpatient visits, all H&Ps on inpatient, all discharge summaries, all operative notes.

We watched each clinic as we went live and saw what happened to their transcription. It was so interesting. In primary care, it went from 100% to about 2% within a calendar month. In specialty care, it dropped down to more like 10% of what it was previous and then just kind of hung out there. It was an interesting marker of use of the system for me. To think, “Wow, people went from 100% dictation to 2% dictation. They must really be using the system.”

Although I learned that wasn’t really a statistic I should really share with my physician colleagues, because when they looked at that, they said, “Yeah, now we’re typing all our notes. We’re doing all this work. See that? We’re busting our chops to get this done. We don’t like that number.” So, I stopped showing them that. But to look at it as a measure of adoption, I thought it was pretty dramatic.

We saw that happen on inpatient, too. The same thing. We left transcription on. We didn’t take it away. Providers don’t suffer a penalty for using it, other than a workflow penalty of “now I’ve got to read this and authenticate it later”. But they were naturally drawn to it in just about every case, except the one area where it’s only fallen about 50% has been procedure documentation. Surgeons are still dictating a fair number of their procedures, but everything else fell pretty quickly.

Obviously, the financial people watched all those metrics very carefully. I’m probably not as versed in them as maybe I should be, but my gestalt of that is they’re all extremely pleased and happy with what happened. Then a lot of the other things that folks look at, I think, are more subjective and we’re still trying to actually figure out how to measure.

One of my major projects this year has been developing what we’re calling the Informatics Dashboard. There was this great article a couple of years ago that looked at how you measure the success of an informatics project. They looked to the management information systems literature and came up with these six dimensions.

So we looked at them and said, “It would be great to have a couple of metrics that we could describe, relating to each of these dimensions of system success.” Things like system quality — how good is it? Does it turn on when you turn it on? How’s the up time? How’s the response time? Information quality — sure it turns on, but is there information in there that you want and is accessible and you can use? The third one is usability, and how much usage does the system actually get? If it’s a really great system, people use it a lot, right?

Then there’s metrics for organizational impact and individual impact. Organizational impact like quality and how are you impacting that? And then individual impact, which is the thing I think physicians get very concerned about with an EHR, and it’s also the hardest one to measure. How much time am I spending documenting? Is this taking away from teaching or research? What about all this time doing notes at night when I go home?

We’re still struggling a little bit to figure out how do we measure that type of stuff and make it objective. When people complain about it, can we say, “Yeah, we really have a problem.” Or is this a problem of one instead of a problem of many, and how do we prioritize all those?

When you look at that, in context of the proposed Meaningful Use criteria, do you feel good about where you are?

Oh, yeah. I’m thrilled with where we are for Meaningful Use. In some ways, we got lucky. In some ways, it was vision. But for us, I think achieving Meaningful Use is going to be about crossing some Ts and dotting some Is. It’s very, very attainable for us, and so for that part, I’m really happy.

What are you doing with form factor stuff like mobile computing, or anything creative with nurses?

I don’t know how creative we are. We’ve got our devices on wheels. Pretty standard, like other folks have. We committed to having fixed devices in every patient care room, both inpatient and outpatient.

Being an academic center, we shied away from devices that could walk. Anything that wasn’t tethered. When you’ve got students and residents and people rotating through, our experience is if it’s not tied to the wall, it won’t be in the room for too much longer. It’s the same reason we have ophthalmoscopes tethered to the wall. Because after a year, if we handed out a bunch, they’d all be gone and nobody would know where they are; they wouldn’t be charged. So we focused a lot on fixed devices and trying to have them ergonomic so you can move around and stuff, but you couldn’t walk with them.

I think that’s been pretty successful. We’ve had some good luck with that, although there is always a lot of interest in the latest hand-held stuff. We had a lot of people who were interested in tablets when we started out. Of course that died because tablets weren’t really usable. Now it’s the iPhone and the iPad. I don’t know, maybe Apple will crack that nut a little bit better than some of the early PC tablet people did. We’ll have to see.

The industry is struggling a little bit to digest a couple of recent studies that tried to prove that the clinical information systems don’t improve outcomes or save money. Do you believe that those conclusions are accurate?

Yes, but I think we’re asking the wrong question. When we ask a question like, “Do EHRs work?” It’s kind of like asking, “Does surgery work?” What surgery? For what problem? In who’s hands? With what training? All those details are the things that determine whether or not surgery works, you know?

It’s the same thing with EHRs. Do they work? Well, they can work if you do the right things. The other problem with it is we wrap everything up and call it the EHR, but it’s really not. It’s not the software; it’s a process that we’ve developed. It’s a way of taking care of patients that we’ve codified, to some extent, in an electronic system. But when we look at all the studies that show effectiveness — or lack of effectiveness — what I try to look at is, OK, but why? What was it that made this one place really effective at doing this and not another?

I think informatics, as a science, is still pretty much learning those things. What are the necessary and sufficient conditions for success? It’s obviously not just about having a piece of software that does a certain thing. Otherwise, everybody’s experience would be the same with it. I’m not sure we fully understand … I know we don’t fully understand all the things that make it successful or make it not successful; such that we could develop a checklist and say, “Okay, as long as you do these 50 things, or maybe it’s these 500 things, you’ll be 100% successful.” I don’t think we have that yet.

What would you say your goals are for the next five years?

Oh boy, five years? I seem so focused on today. I think for us, it’s to build out the house that we’re ready to create. We’ve laid a great foundation here to do some really amazing things in medicine with the technology that we have. Over the next five years, I’m really excited to see how we will build that. What will it look like? Who will need to be involved? How will we fully engage caregivers? Operational departments like quality and safety to really see this as a tool that is their tool to use and operate and manipulate to achieve the ends that they want to see. I think that’s the most exciting part.

The other is to continue to refine the system, such that my colleagues who are nose to the grindstone, incredibly busy, by and large see this as a positive thing that enhances their ability to do a good job. Right now we see a lot of variability in people’s opinions along that line and we still don’t fully understand what the factors are that result in that variety of opinion.

I tend to think it’s that we still have a somewhat coarse tool that needs to be refined before people say, “Aha, this just works the way I expect it to. It works like Google, or it works like my iPhone.” I don’t know if we’ll get there in five years, but I’m sure we’ll be a lot closer than we are today.

HIStalk Interviews Phyllis Gotlib

Phyllis Gotlib is CEO and co-founder of iMDsoft.

Tell me about the company and your products.

iMDsoft was founded in 1996 after a few years of development. We started with an alpha site in Tel Aviv and had our beta site at Mass General and Brigham and Women’s in 1997. Once we got clearance on our products, we decided to move to Europe and also to validate our implementation methodology.

Our first product was for ICUs. We went to Europe and decided on four different languages and four different countries. We received rave reviews.

Our first commercial installation with ICUs was in Lausanne, Switzerland in 1999. We went into the Netherlands in Dutch, Norway in Norwegian, and of course to the UK in English. Since then, we grew all over Europe, came out with a new product in 2001 for the entire perioperative environment — pre-op, inter-op, and the PACUs. We had a partnership with Fukuda Denshi, second largest medical device manufacturer in Japan, in 2000. We went back to the US in 2002 and set up our headquarters in Needham, MA where I spend most of my time.

Since then, we have close to 150 hospitals world-wide with more than 9,000 beds under license. We continue to grow beyond the walls of the ICU and OR as we expand outside of critical and acute care. We have a new product called MVgeneral that goes to the general floor.

We map the entire inpatient workflow in all these departments. Every type of ICU — all adult ICUs such as neuro, CCU, med-surg, NICUs, PICUs, and the entire perioperative environment, step-down, and general wards. We have supporting products that include MVmobile for ambulances and MVcentral, a tele-intensivist product, and others. All of our products share one database and provide a true continuum of care.

Most US healthcare IT vendors have customers outside the US, but most of their business is domestic. Is it an advantage or disadvantage to have a more balanced international footprint?

I see that definitely as a hedge. We started in Europe because, at the time, the R&D was in Tel Aviv and there was a blend of a lot of languages and people that came from the European countries to Tel Aviv. That was an easier way to start the company.

You can see similarities between territories. You can see similarities between the European market and Canadian market and between the UK market and Australia.

The US is different, but when we do user groups, the US customers are really happy to mingle with the European customers and vice versa. We believe in a sharing philosophy. Our US installed base is really high-visibility and very impressive, with Johns Hopkins, Mass General, Partners, Barnes-Jewish, Henry Ford, and so on. In Europe, we also have high-end academic hospitals, community hospitals, and smaller institutions.

They all like to mingle, to exchange protocols, and to share information. For us as a company, it’s definitely a hedge and allows us to lower the risks and to be able to answer the needs of the different regulations and initiatives in different countries.

You’ve described iMDsoft as a disruptive innovator, but I don’t know that many US healthcare CIOs are familiar with the company. Who are your competitors and what are your competitive advantages?

You will hear me quite often say that it depends on the segment and the territory. I would put them in buckets. The competition can be the old medical device companies like Philips and GE. Another bucket would include the bigger guys, like McKesson, Eclipsys, maybe Cerner. The others would be smaller, software-only companies like Picis. In Europe, in every country you can find a local vendor that is really specific.

You can differentiate the competition into OR competition, perioperative competition, and the ICU competition. But of course, I would tell you that we have very little competition [laughs].

Regarding differentiation, definitely I would talk about clinical data granularity. Secondly, I would say decision support. After that, our ability to customize — the flexibility of our products.

One of our fortes is interoperability. A good example is Barnes-Jewish Hospital. We are integrating and interfacing with eight different vendors. Giving you only US examples, at Lehigh Valley Hospital and Health Network, we have a full integration with, at the time, IDX Lastword CPOE, which became the GE product.

Another key differentiator for iMDsoft has always been our ability to impact not just the quality of care and clinical decision-making for our customers, but also to contribute meaningfully to their level of operational efficiency and resource deployment, and ultimately, to make a positive impact on the financial performance of their critical care department.

When I talk about customer impact, it can come from a number of different perspectives that cut across clinical quality, operational efficiency, and cost savings.

When I talk about clinical data granularity, every data item in our system is a user-defined and controlled parameter. They are stored in a hierarchical manner in the database, which allows them to have sophisticated relationships between them. Those parameters can be time-related or non time-related and can be from any type and they will have attributes … for instance, a formula can be a parameter, a drug can be a parameter, a change in position can be a text parameter, and so on.

A good example is saline solution, where the granularity will go down into water, chloride, and sodium. Every time a user gives one cc of such a solution, every minute you can see the trace elements in our system every minute. For instance, you can check the patient’s potassium minute by minute. These things are very important in critical care, where the patients are not eating or not drinking — they get intravenous nutrition or enteral nutrition and also all the volume that they get from drugs is documented.

A 2005 study I read described the use of MetaVision Event Manager to deliver alerts that are based on physiologic and order information in the ICU and the OR. What are the opportunities there?

It’s a huge opportunity. We hear that from all our customers. The Event Manager was endorsed by Harvard Medical School and by most of our hospitals. It’s a real-time decision support, a rules-based engine that provides alerts that can be clinical, administrative, or financial in nature. They can be delivered to the appropriate person and place as needed via screen, telephony, pager, and so on.

I can give you an example. First, we collect all the data. Once the granular data is in our database, you can then put rules on the data. You can write statements, like if-then statements.

One of our hospitals in the United States — I cannot say the name — conducted a study that showed that a certain generic anesthetic was as good as the brand name anesthetic for longer surgeries. The hospital gets reimbursed for the procedure at a set amount, paying for the anesthetic themselves. They did not have a reliable mechanism to remind anesthesiologists to use the generic drug in longer surgeries.

They programmed the alert to remind the anesthesiologist to consider switching to the generic if the surgery has already been more than X minutes. The statement was very easy. The alert took one day to produce, it took them a few days to test it, and in less than a week it was in production. Over a year, it saved them more than $500,000.

That’s an example of ROI using the Event Manager, but since every data item is a parameter, you can also use it to drive clinical improvements. In another hospital in the UK, they managed to reduce their drug costs per patient from $197 to $149 just by increasing generic usage, from 61% to 81% with MetaVision using the Event Manager.

I could go on and on with examples like that, but it’s actually using all the granularity, all the elements, all the parameters that we have in our very rich database and putting rules on top of them.

What about the use of reminder checklists and dashboards?

Our dashboard actually allows us to see the data in a global view, not only on the patient, but also on the unit. Along the way, we’ve also started implementing entire regions. We recently started an implementation for an entire province in Canada, another province in Australia, and also in Norway. Our dashboard provides a global view of a unit of a hospital, a region, or also something more like a network or province.

The checklist is something quite easy. It’s done all over the system. The entire system is rule-based and you can add alerts and mandatory fields. It’s really comprehensive and has all the functionality that is required to provide best practices and to give guidance.

Most of what I’ve written about iMDsoft involved the lawsuits with Cerner and Visicu over intellectual property involving remote monitoring technology. Did that turn out the way you hoped?

We are actually in the midst of our litigation. However, I can tell you that Visicu recently lost against Cerner for the same complaints and Cerner used our prior art to defend itself. So, I believe we are in very good shape.

A recent study, perhaps not very well done, concluded that remote ICU monitoring did not do much to improve outcomes or reduce costs. What was your reaction to that?

It was ambiguous. I’m never happy to see that the competition is doing a lousy job. If you look at the entire market and you see that we have only 10% penetration, we are beyond the early adopters. I need everyone to do a good job because if not, it will put up additional barriers. I know that we have ARRA, the stimulus, other regulations around the world helping us, but still, we need to do a good job.

So, there was something in my heart where I was glad to see that our competitors didn’t do a good job, but on the other hand, overall, that’s not the right thing.

It is interesting because, from our end, we have a study that shows in our tele-intensivist program, a customer was able to reduce the mortality rate by 30% by using MVCentral in their remote ICU.

You have some of the best hospitals in the US as your customers. Is the US market key to your strategy and if so, how will you get the word out?

Absolutely. I think our customers are our best advocates. We are investing in enlarging our channel distributors in the US and I hope that by the end of 2010, we will be able to have a balance between the rest of the world and the US revenues.

Do you think the stimulus incentives will affect your business here?

I think hospitals in the US will have no choice. The government, the payors, and the regulatory agencies have all begun to link clinical performance to reimbursement. It’s a first in the modern history of medicine. US government initiatives, such as PQRI, the various pay-for-performance initiatives launched by large payors, and European government initiatives have all been in the headlines.

Elected officials see these initiatives as crucial to contain health costs and improve quality of care. We at iMDsoft definitely believe the recent trend will continue and the amount of reimbursement at risk for hospitals will grow.

We see also that clinical data management and protocol enforcement now have important financial repercussions and making clinical information systems for critical care an even higher priority. There is not one CIO that doesn’t have this on his radar. They just need to prioritize it, whether it will be on the budget of this year or next year, but it’s definitely on the radar.

The start that everyone was hoping for the last 20 years is actually happening now, not so much because of the carrot, but because of the stick — the penalties and because it is impossible to manage so much data and so much information that is coming from so many different sources without having a clinical information system.

Final thoughts?

We are excited about what we are doing. We have a vision and a passion here. We are in 21 countries, supporting 18 languages, and hope to expand. We would like to continue to be a innovation leader and keep the level of quality of our products and services as we continue to grow.

An HIT Moment with … Chuck Demaree

An HIT Moment with ... is a quick interview with someone we find interesting. Chuck Demaree is vice president of product development with Access of Sulphur Springs, TX.

Absolutely. The focus of an EMR is to provide an electronic collection of medical information that can be used real-time during the clinical episode and historically as an archive. Generally, not all information will be fed electronically into an EMR. Forms provide a tool for the organized collection and presentation of information that will not be collected electronically.

In supporting the EMR, EHR and LHR, an electronic forms solution provides:

• Consistency in form quality, format and delivery.
• Accuracy in correct filing information through the use of patient-specific bar codes.
• Efficiency through the use of business rules by assuring that all the correct forms are generated (collecting ALL of the needed data).
• A standardized and structured presentation of data in the EMR, especially if COLD feed information is passed through the forms solution to provide a standard presentation.

Describe the typical workflows associated with using access-related electronic forms.

The most common entry point for Access EFM is in the registration area. A typical workflow would start with the registration of a patient. The resulting information generated by the registration system passes to the business rules engine in the Access EFM server where data elements are evaluated. The rules engine then determines what forms are required, what data needs to be applied to each form, and where and how those forms need to be distributed.

For example, a customer being registered as an inpatient would have a complete registration packet that is customized to them for this particular clinical event printed in the registration area, with bar codes and demographics applied. The only documents that would print there would be documents that the patient (or their family) needed to take with them or that needed to be electronically signed, such as consents. The bar codes on each form enable HIS staff to interface forms into the EMR with less effort, as the ECM/EDM system uses bar code recognition to auto-index the forms with the patient record. 

Electronic workflow would then route any other documents needed by the nursing unit, laboratory, pharmacy, patient finance and other departments directly to their location (or application) at the time of registration. Electronic notifications (via fax or email) would be sent to the primary care physician notifying them of their patient’s admission. 

In more advanced forms management projects, registration staff send forms to a monitor without printing. The patient reviews them, applies their electronic signature on an LCD pad, and the nurse submits the forms. They’re then interfaced into the ECM/EDM system, a paperless process that eliminates the financial and environmental costs of forms printing.

What is the Universal Document Portal?

The Universal Document Portal (UDP) is an interesting and exciting product. The purpose is to provide a method to feed the EMR electronically from systems or medical devices that do not have the ability to COLD feed today.

Some examples of how this is being used by our customers are:

• Passing medication orders which used to be faxed, from one vendor’s HIS system to a competing vendor’s pharmacy system.
• Providing an electronic import capability for clinical documentation from one vendor’s HIS system to another vendor’s EMR. This particular customer has well over 50 different feeds running through UDP
• Indexing the output from a 12-lead EKG system directly into the proper patient’s chart in an EMR.
• Migrating historical medical record information from a system that is being discontinued into the customer’s current EMR.

The uses for UDP are only limited by the output abilities of the system or device and the IT/IS team’s imagination.

How can electronic forms support patient safety?

The Access EFM system impacts patient safety both directly and indirectly.

Every form outputted from Access EFM has patient identification bar codes on it, enabling positive patient ID throughout the encounter. Bar coded wristbands are generated at registration and reconciled with bar coded medication labels also printed by the Access system, facilitating accurate bedside medication verification (BMV).

Documents that are passed into the EMR have a consistent structure which reduces search time for information. Because of patient and form specific bar codes on every form, all forms are accurately filed in the EMR
Notification of printed bar coded forms are sent to the EMR for the purpose of creating automatic deficiencies, which are resolved when the form is scanned in.

The indirect impact is the time saved by the use of the business rules engine and the staff efficiencies it produces. The business rules take the guesswork out of what forms need to be pulled and what data needs to be collected. If it needs to be done based upon the data entered for the patient, it gets done because of Access EFM.       

How common is it for hospitals to capture patient signatures electronically and how are they using them?

Electronic signature capture is becoming more common every day. The most common uses are obviously in the signing of consent forms, whether in registration or at the bedside. Other uses are the signing of discharge or patient teaching instructions, financial responsibility documents, and any other document that provides legal protection for the facility during the care delivery process.

The most important factor in choosing an electronic patient signature solution is how well those signatures will stand up in court. Basic electronic signatures like those used in a grocery store (TIFF on TIFF) are hard to defend if legally challenged as they could be copied, forged, or altered after signing. Access e-Signature creates a biometrics file that becomes part of the patient’s record and proves that the original signature was not forged or changed, positioning hospitals well for audits and e-discovery.

HIStalk Interviews Dane Stout

Dane Stout is director of the connected health and biomedical communication practice of The Anson Group.

 

Tell me about the Anson Group and what you do there.

I joined The Anson Group last fall. I’ve known the folks there for quite some time. The company has been around about 14 years. It grew up in the traditional medical technology / medical device space. I’m pharmaceutical. They’ve provided a lot of services over those years in regulatory quality systems. Helping them to put clinical trial protocols together, all that kind of stuff.

We started talking a while back about some of the changes that were happening in healthcare and this convergence of all these different players, and so we said, “There really seems to be a need for our services that we would put together to bridge the gap, really, between the traditional medical device, pharmaceutical companies — who are very familiar with the pretty onerous burdens of the regulations inside of healthcare — and then all the newcomers that are coming out of consumer electronics and general IT and telecom and you name it.”

Everybody’s flocking to healthcare because of the stimulus, because of the size of the market, and because of some of the margins. But I don’t think they have a real appreciation for what they have to deal with. That’s why my job here is to drive the “connected health practices”, is what we’re calling it. We’re really looking at a very network-centric perspective. To say, “All these new players are going to come in and they’re going to need ways (people) to help them get their innovation to market and still comply with the law and all the regulations that are a part of that.”

Give me some examples of some of those converging technologies that would be running on a hospital network.

We break it into two components. There’s what I would call the mission critical — I’ve classified it as more biomedical communication — so inside the walls of the hospital, you now are going to have all these medical devices that are there. They’re either just a closed-loop system sitting over in the corner, or they actually now have a private network.

I’ve read where the average hospital has somewhere around 240 distinct, private networks. There really isn’t that much value to that. What they would all like to do is to have the medical devices communicating with each other, communicating with the EMR connected to the order entry system, and be able to collect all this data and be able to feed that into data repositories and be able to improve on their performance using that.

A very different model in terms of a high-performance, high-critical response requirements that would be a part of that network. Being on the hospital enterprise LAN, now you’ve got medical devices that were designed from the ground up to operate in isolation that now all of a sudden have to be good network citizens and make sure that their security updates and software patches and all that don’t disrupt the other devices around them.

When you go into a hospital, who engages you? Would you typically be working through the IT department or straddling between IT and biomed?

That’s part of the other issue. There’s that convergence of the biomed, the clinical engineering staff, IT, the medical device vendors. The FDA, while they haven’t made a real definitive stance on the regulatory requirements, which we’re all kind of waiting with bated breath for the medical device data systems — guidance, which they continue to say, will be coming shortly — they did come out in November and said, “Look, the spirit of the IEC 80001 risk management framework is that the device vendors and the hospital IT staff share a joint responsibility for making sure that these things work together. They collaborate on implementing them correctly to maximize patient safety and the effectiveness of the devices inside the hospital.”

If a CIO is unsure about whether they need your services, what are some warning signs that it might be time to bring in an expert?

I think there’s a lot of questions. Where’s this all going? Who’s going to be regulated? I think there’s just a lack of understanding, and that’s one of the things that we’re spending a lot of time on. Just really educating people as to the FDA or the federal government’s view of what is a medical device.

I think people have this misguided understanding that, “Oh, well that’s Boston Scientific or GE.” The traditional people that make these big medical devices that we all see. That’s them. We’re not regulated. In fact, it’s really based on the intended use of the device. Is it really intended to diagnose or treat a disease? And if so, what kinds of claims are being made about that and by whom?

There are lots of examples of where you could combine multiple devices and create a new device. Hospitals even cross the line themselves where they become, in the eyes of FDA, actually a medical device manufacturer themselves.

Part of what we’re doing through our alliance with Epstein Becker & Green, which is the largest healthcare law firm in the country, is to help them, from an end-to-end process, understand what all those requirements are and to help them with the risk assessment, the regulatory assessment. You know, what does this mean in terms of HIPAA and privacy requirements, all the way through the process.

We’re equal opportunity players. We’re looking at as anybody that’s participating in connected health could be a potential client of ours, because they’re all going to have some impact from the change that the network introduction really drives.

Are you seeing an increased interest by the FDA in what they could or should regulate?

I don’t think it’s an increased interest in what they could regulate. I think it’s more how.

I just came back from the FDA Medical Device Interoperability Workshop. It was co-sponsored by the Continua Alliance, CIMIT, and the Medical Device Plug-and-Play initiative that’s being driven out of the Boston area, Dr. Julian Goldman, and then FDA. This was a three-day event that I attended at FDA’s White Oak Campus.

The whole discussion is — we get it that this future of what we have to deal with, in terms of devices, really it’s not just ARRA/Hitech driving this. It really is a requirement. That to make healthcare better, we’re going to have to have devices talking to EMRs. We’re going to have the ambulatory side of the business. We’re going to have to have all these connected devices and we’re going to have to figure out a way to regulate that because our mission hasn’t changed — protecting the public health and safety. We’ve just got to figure out a way to do that.

I think they’re open to figuring out ways to work with industry and to work with other groups inside the government, to try to figure out how do we do this in this new world of networked connectivity; which is very different than what’s really happened over the last 30 years since they started regulating devices.

Did you get any sense from the FDA that they have any interest in regulating electronic medical records, or only this new connectivity to what would always have probably been some sort of medical device?

I think when it comes to regulatory exertion of what they’re able to do under the statutes; they have a broad range of discretion. It’s what they regulate. You could make an argument that an ambulance with all the connectivity devices on it could be regulated. That was an example that they used.

They’ve chosen, obviously, not to get that far. But software? Certainly software is prevalent in medical devices, and there’s clear guidance offered up by FDA about software that’s used as part of diagnosis and treatment of disease and all the software that goes into traditional medical devices.

I think they’re saying, “Look, we may or may not do that. There’s two ways you can get our attention. You can come to us with a submission that you feel like this could be a medical device and you want to go through that process because you clearly see that it’s a diagnosis or treatment — it’s a clear case of that. Or, something happens and we have to make some intervention in that.” So it really depends on those two kinds of factors.

I don’t think they’re looking for more to do. I think they’re overwhelmed with the social media and pharma. There’s a lot of stuff that’s on their plate … the globalization of research … but they made no bones about it that they’re there to safeguard the public’s health and safety. They’re watching very closely, with interest, what is the development of the HIT software industry. Longer term, I think it would be naïve to think we’re immune from that. We’ve never been covered.

It really depends on the statutory classification of the device and their interpretation of that. I guess at the end of the day, they determine what they regulate based on the law. The vendors don’t get to pick. I think there’s some that we’ve talked to that think, “Well, no, I’m not a device.” Making that declaration doesn’t necessarily make it so.

Should software vendors be afraid of what FDA oversight would be?

You know, that’s really the message; because I don’t want it to be, “Oh, we’re the onerous coming in with all the bad news that you’re going to be regulated.” I think what we’re really suggesting is healthcare really needs the innovation of information technology. It needs the new entrants from consumer electronics. It needs it from the wireless providers. It needs it from the general IT players. I think it needs the HIT vendors that are well established inside the hospital — all the guys that are going to be at HIMSS — to say, “You know what? We just need to understand what our role is and what our potential requirements are in this space.”

Our message is that you can live with this. I mean, look at the industry. There are thousands of medical device companies. They all make pretty good margins and are pretty successful businesses. They just deal with the regulations that are required. It’s just part of the table stakes to get into the game. I think people don’t need to be fearful of it, but they don’t want to ignore it.

I think our job is to help them understand those requirements and to set their business strategy based on that. Don’t wait until you come out with a product to go out and tell the market you’re in healthcare, and then try to figure out how to  deal with regulations. Make that a parallel effort right there up front as part of your strategy.

If you don’t want to be regulated, we can help you figure out a way where you totally stay away from that. You just provide components. Or, if you’re willing to accept the responsibilities with that and enjoy the really big margins, we can help you devise a plan to do that, too.

If you were advising vendors about practices they could voluntarily adopt that would prevent the FDA’s interest or would move them along the path that FDA wants them to take, what would you recommend?

I think following some of those quality system guidelines that are clearly laid out, which are a cut above ISO 9001. That’s another common fallacy, “Oh, we’ve got our supply chain; we’ve got our quality systems pretty well in hand with ISO 9001.” But it goes much more beyond that when you’re talking medical-grade systems.

I think there are some voluntary things that they could do to probably show the good faith of that, but there’s lots of ways to really strategize around that. That could be partnering with somebody that really has already embraced those requirements. If you look at GE, they have a broad footprint in healthcare. I think there are other examples. If you look at Intel, they clearly understand that they’ve moved in the device space. They did a 510(k) for Health Guide.

There are people out there looking at it saying, “This is something we’re going to take on directly.” There are some partnerships that other companies say, “I don’t really want to go to that extent. I want to stay away from that boundary line” that they can partner with.

I think the traditional players in software, the big EMR vendors and all, are going to really need to be monitoring this carefully and start thinking about the flipside of all of the interoperable health records. The connectivity inside the hospital does mean that things that were never involved before directly in diagnosing and treating patient illnesses now become a critical part of that.

I believe the folks in Washington are going to look at that very closely. Doing things the right way, maybe following some of those same processes that the device companies are already doing, and doing that voluntarily could certainly be a step in the right direction.

What kinds of innovation could run afoul with the regulatory environment if companies weren’t looking ahead?

I think all innovation is subject to that, but I think the ones that seem to be top of mind today are … I guess we really didn’t finish the first part. There are the two prongs of this. There are, inside the hospital wall, devices sitting on the enterprise LAN talking to the major software applications in place. There’s the other side of that, which is more of the remote monitoring care at home, monitoring of chronic conditions through wireless networks through your cell phone, connected to some other medical device to try to improve the quality of life, and to give people sort of this continuous monitoring of care and feeding that back to a call center where the nurse is.

There’s a lot of interest, there’s a lot of activity, and there’s a lot of great innovation that’s coming of that space, but I think there are some folks out there that may be pushing the envelope. I spent a long, 20-plus years in the traditional IT space and I know how IT marketing is. This one-upmanship. You’re always promoting your vision and you’re sticking it out there. You have to be much more deliberate about it when you start talking about marketing inside of healthcare, because you can find yourself backing into a situation where all of a sudden now you’ve completely put yourself in the purview of FDA regulatory requirements.

If you start making claims about things that your cell phone platform can do in terms of helping people monitor their diseases, you’re now involved in that. The same device … if you’re a manufacturer of a cell phone handset and you don’t make any claims about that and it’s just some of the other applications that are out there are using your device, then you can be exempt from that.

It’s an area that you can find yourself backing into it, and it’s a huge problem. Or, you can set that deliberate strategy and understand, “What are the areas that I need to stay away from?” That extends to not just marketing material you might have on your Web site, but it could be what your sales representative talks about, or what you talk about in a conference. There’s lots of ways you can communicate that, “Hey, I’m really involved in the care of patients” that companies need to be careful of.

The software vendors have traditionally just said, “We disclaim everything. We’re saying it’s not fit for purpose unless you say it is and it’s the clinician’s judgment.” Then bundle that with non-disclosure clauses, which would seem to be something the FDA wouldn’t want to see. Is that enough to keep the FDA away? Is just disclaiming your responsibility really a long-term solution?

No, not at all. It would have, really, no impact if there were a situation that they came up from somebody using one of these devices. Including software, because software clearly can be defined as a medical device under FDA current regulations — there’s no bones about it. They can step in and enforce that.

I think one of the telling things is if you look more deeply embedded in medical technology is this use of nanotechnology. On the Frequently Asked Questions page of the FDA Web site, they had a question about how you regulate nanotechnology. They said, “Look, we don’t regulate technology. We look at the statutes. We look at the claims. We look at all of the rules that apply to what our mission is, which is safeguarding the public’s health and making sure that the claims that are made about medical treatments are effective and valid and legitimate. That’s what we do, and we look at that regardless of what the technology is. So we’ll classify new, emerging technology according to our interpretation of the law.”

I think people are saying, “Well, they haven’t come out with any definition of how they’re going to regulate a network device.” Or, “They haven’t told us how we’re going to regulate nanotechnology.” But I mean, technology moves at such a fast pace. If you think about it, there were no medical applications for the iPhone until August of 2008. So the law and the regulatory requirements that move along behind that move at a much, much slower pace, but that doesn’t mean they don’t apply.

That’s really what we’re trying to help companies, our clients, navigate those two very diverse sets of reality. That you want to get that innovation out there; you want to continue to drive it. Again, there are some really interesting things that are going on in the connected health space, but at the same time you have to understand that you still have to play by the rules that all the established device companies have done for 30 years.

The connectivity to the devices will help hospitals accumulate large quantities of patient clinical information, which will probably have a lot more research value than anybody had really thought of. How do you see that tying together both the collection of data that maybe wasn’t really integrated with normal software-type data before, and then what the requirements will be to both collect it and use it?

Clearly that’s part of this whole notion of connected healthcare where we insert this interdependent network between all the different players. So you get the payer, the providers; you’ve got network participants right now that I think are pushing the bounds of … they’re both doing some really good things, but you start wondering about these decision support tools that you use based on some remote analytics engine and some big information repository out there in the sky. But now since it’s involved and the doctors directly rely on that and there’s some sort of workflow enablement that’s part of that, it really drives right to the heart of it.

To answer your question about the data … as it moves around, it can actually traverse different regulatory jurisdictions. So if you think about it, there’s a lot of interest by the big drug companies in looking at EMRs as the source for clinical trial data and for clinical trial participants. But as that data moves from an EMR to an electronic data capture system, let’s say, which is basically the same thing but it’s done for clinical trials, it’s now moved from the privacy rules of HIPAA over onto 21 CFR Part 50 and 56, which really governs the privacy and treatment of information for clinical trial subjects. So as data kind of moves around in the network, it can actually move between jurisdictions of different federal agencies.

Again, we want to provide a clear knowledge base so that people have a clear understanding as they’re setting up their strategies to say, “How I approach healthcare?” especially if they are new to this business. It’s very important to understand all the different layers of complexities, including one we haven’t really talked about much — how do I get paid for that?

As you know, inside the hospital, all those things are really being driven by how private insurers pay us. Is it medically necessary? If you look at CMS, it’s reasonable and necessary — and there’s very definite restrictions on that. I’ve talked to a number of companies that say, “We want to get into healthcare. We’re really excited. We’ve got all this cool technology.” Then we’re like, “OK, well how do you intend to get reimbursed for that?” “Oh no, we don’t even want to mess with insurance. We’ll just sell it to the consumer.” I think that’s a really flawed assumption when you’re moving into that space because most consumers are still going to look to their health plans to pay first. Even if it’s a comparable cost to maybe some big consumer electronics purchase, we’re just conditioned to look at that first.

So now they’re moved into this whole area of not only am I looking at FDA, but I also have to look at CMS, and then what do I have to prove to the medical directors at all the big insurance companies? Then, just throw in Meaningful Use along from ONC. There are lots of really small phrases that can have very impactful meaning.

I like to sum it up to say that with FDA, it’s safe and effective. CMS, it’s reasonable and necessary. ONC, it’s Meaningful Use, secure and interoperable. Those are fairly simplistic words, but they’re very complicated to actually deploy in real life.

Anything else?

Our big goal is that we have a vision, not to come in and be the bearer of bad news, but to say healthcare absolutely needs IT. When you put healthcare and IT together, it becomes HIT and it’s different.

What’s really different? I think it’s this aspect of clinical treatment of human beings. It’s different than retail. It’s different than manufacturing. It has important nuances to it that we want to make sure that they map into their strategies. We want to help them get that innovation to market and comply with the law and the regulations that are part of that. That’s our goal.

HIStalk Interviews Scott Weingarten

Scott Weingarten, MD, MPH is president and CEO of Zynx Health.

What was your reaction when you saw the proposed Meaningful Use criteria?

When you look at what was published on December 30, I don’t think there were any huge surprises based on what we saw over the summer that was published in June and July. There was a continued focus on clinical decision support, which we anticipated based on the earlier information. We believe that that is a good thing.

We think clinical decision support can lead to improved quality and safety of care, as well as less costly care. We believe that’s where the greatest benefit will occur as a result of the investment in healthcare information technology. We were pleased to see that clinical decision support remain prominently featured in the December 30 publications.

Do you think the requirement to create five clinical decision support rules is a good step toward using systems to guide physicians?

I do. Initially, I believe it was one. Now it’s five. I think the bar is still very low for clinical support rules. I think in order to get the clinical return on investment and the cost benefits that the federal government would like to achieve, I think they’re going to need more than five, but I think it’s a good start.

To many doctors, when they hear clinical decision support, their experience or their perception is that it’s just intrusive, unhelpful, impersonal warnings that stop them from doing what they want to do. What has to be done to turn that into that vision of having it impact quality and cost?

They have to look carefully at both the sensitivity and the specificity of the clinical decision support, meaning, look at very carefully that there are as few false positives as possible. I think at least historically, largely with drug/drug interactions, there are many false positive alerts that in many cases can color our view about the value of clinical decision support.

When one goes beyond drug/drug alerts and really looks at the broader potential for clinical decision support, and if one really focuses on those aspects of care that provide great clinical benefit… For example, evidence-based clinical processes that have been shown to reduce mortality, reduce morbidity, and improve quality of life or safely reduce costs when one pays careful attention to the specificity, or ensuring that there are as few false positives as possible. I think the annoyance factor will go down and I think the benefits will increase.

Do you think it’s the content provider or the application vendor who needs to refine that sensitivity/specificity and the ultimate presentation of whatever the result was?

I think that it’s really teamwork. When I say teamwork or collaboration, I think the content vendor needs to really give a lot of thought to optimizing the sensitivity and specificity of the clinical decision support. I think the healthcare information technology supplier needs to have the functionality to optimize the specificity and sensitivity of clinical decisions.

Also the client, in some cases, can pick and choose which components of clinical decisions support that they would like to utilize. Thinking about the benefits, or them really analyzing the potential benefits of turning on clinical decision support, should occur before they select what form of clinical decision support.

A good example, as you mentioned earlier, would be the five rules. Making sure that the five rules are those that really will favorably impact care at their organization, have the greatest clinical benefit, and yet the rules will be as specific as possible.

One of the things that it seemed was fairly clear in the initial proposed criteria was that the rules needed to be user-maintainable rather than just a black box that you take as they come. Was that a surprise?

No, I think you want them to be maintained by the user because I think that different organizations, depending on local practice, there’ll be some rules that provide greater benefit than at other organizations.

Let me give you an example of what I mean. Let’s say an organization has already achieved the ceiling effect and eligible patients with chronic heart failure are being treated with either an ACE inhibitor or an ARB. Well, having a rule will provide very little benefit, just because the care is consistent with best practice or evidence-based practice. Another organization where they have not achieved those benefits, where far fewer appropriate patients are treated with ACE inhibitors or ARBs for chronic heart failure, may have an opportunity to save many lives by providing that rule.

Really, the point being that different organizations will achieve different benefits with different types of clinical decision support, depending on the size of the gap between optimal or evidence-based practice in their current practice. Practice varies, as I think has been very well described, organization to organization. Therefore, I think having the user select which clinical decision support rules have the potential to provide the greatest benefit for their organization, and potentially maintaining the information, to me, makes sense.

When hospital-based vs. practice-based doctors create their initial five rules, how will their priorities differ?

I think that the types of rules that are likely to be created in the ambulatory setting or by physicians in their offices will reflect the patterns of outpatient care. My guess is we will see a number of alerts and rules for chronic illness in the form of disease management rules or preventive care; where I think the rules will be quite different in the hospital, which will reflect acute illness requiring hospitalization.

My guess is in the ambulatory setting, we might see more rules related to chronic illnesses such as asthma or diabetes. In the hospital, we might see more rules and alerts that relate to the more common reasons why patients hospitalize, such as chronic heart failure or community acquired pneumonia.

What do you think about rules for nurses when charting or documenting?

There’s a fair amount of nursing practice that can be evidence-based. There are many good studies showing that certain nursing practices, when faithfully adhered to, will lead to better patient outcomes than other nursing practices.

Decades of nursing research support what processes are best for patients, and I think it makes a lot of sense to have rules and alerts to inform nurses, when appropriate. That will lead to the best possible nursing care. I would agree with that. I think alerts and rules are just as important for nurses as they are for physicians and other healthcare providers.

What kind of work has been done, or what kind of interest is there in background alerts based on collecting electronic data that indicate problems, the imminent harm type of rule?

My guess is that the initial rules may not be quite that sophisticated, but I think there’s tremendous benefit that can occur when these background rules — for example, will identify patients based on physiologic parameters, hemodynamic variables where they’re at risk of rapid clinical deterioration — to alert the physician to observe the patient closely and possibly prescribe new treatments.

I think that when we get there — when the field matures, when we’re consistently applying those rules — I think there’s great potential to quickly identify problems that may not have been identified by treating clinicians and to reduce morbidity and mortality. I think in the not-so-distant future there will be many more of those rules, and that will advance patient care significantly.

What advice would you give to hospitals, in general, about creation and maintenance of order sets?

I think it’s hard. One is I would advise them to create, update, and maintain order sets. There are good data in the scientific, peer-reviewed literature that shows that evidence-based order sets reduce mortality, reduce morbidity, and can safely reduce costs. I would advise hospitals to do it.

Second, is there are data showing that physician productivity can be increased when physicians use order sets for common diagnosis rather than write each order one by one. There’s the benefit of improving care and potentially improving productivity, but I think you need the order sets to be viewed as credible by the medical and nursing staff.

They have to be updated frequently. I think they have to be evidence-based. I think if they are not maintained and the information is highly perishable, that when the information goes out of date clinicians are smart and figure it out. They say, “Hey, how come this order set doesn’t reflect the findings in this article published in the New England Journal of Medicine a month ago? What’s going on here? Don’t we want to provide the best possible care to our patients?”

Clinicians, appropriately, can be critical when information in order sets is out of date. The organization needs to come up with a very methodical, disciplined approach to update and maintain the order sets and retain credibility with the clinicians.

There was a statement recently, by Eric Schmidt of Google, that seemed to imply that in his mind as a technologist, practice of medicine is simple as looking up reference information, correlating it to patient information, and out pops a diagnosis and a treatment plan. How can the art of medicine be reconciled with the support that software can provide to those who actually practice it?

I’m an internist. I’ve taken care of a number of patients in my life. Medical care is complicated. I think that it’s complicated for a number of reasons. 

In some cases, there may not be evidence to support a particular treatment decision. In some cases, the evidence might be conflicting. In other cases, the patient may have many co-morbid illnesses.

It’s often not as simple as a patient that has one illness and therefore, this recommendation will always work for this patient. Many patients who are hospitalized have many different co-morbid illnesses which increase the complexity of clinical decision support.

Then finally, patient preferences are very important. I may suggest to a patient that there’s a particular drug I would like the patient to take, but the patient may have had a bad experience with the drug in the past, or may know someone with a very bad experience from that drug in the past. Therefore, for that patient, that drug may not be the most appropriate.

I think medicine is highly complex. Evidence-based information is critically important to informed care; but at the end of the day, what evidence-based medicine does is inform the best possible care. Each doctor and nurse has to understand the preferences and beliefs of his or her patients to make sure that the care is individualized to lead to the best possible care for any individual patient.

Has the industry moved enough toward guiding the caregiver, rather than warning them of conditions? In other words, helping them make a decision, rather than telling that they’ve made the wrong one?

I think so. I think order sets will help guide clinicians to making the right decision. They really do not tell clinicians they’ve made the wrong decision, so I think as an industry we’re heading in the right direction. I think that’s exactly what you want to do. You want to guide them to make the right decisions, rather than you made the wrong decision.

HIStalk Interviews Jim Giordano

Jim Giordano is president and CEO of CareTech Solutions.

What are the biggest problems hospital IT departments are having these days, and what are their greatest opportunities?

I think there are three areas that hospitals are challenged with from an IT perspective. The first is the complexity of the required systems that are now needed. The second is the return on investment focus. The third would be the timeframe for putting in this complex technology to meet the funding deadlines for the ARRA, the American Reinvestment and Recovery Act.

I think the opportunities for the hospitals’ provider networks are borne in these same challenges. They have the opportunity now to begin practicing medicine electronically, which would mean more patient data is available. There would be more patient data shared; it would reduce medical errors in that.

I also believe there’s an opportunity to show the ROI of these systems. I also believe one of the opportunities is for hospitals to take the meaningful use definition that exists and be able to put their plans together so that they can receive these payments that should start paying out in 2011.

What trends are you seeing in IT outsourcing?

We’re seeing a trend towards an interest in outsourcing discrete portions of what a CIO is responsible for in two areas — service desk and remote hosting. We’re seeing CIOs realize that no matter how bright and effective their staff is, they are in effect judged by how well the phone call goes when the user or clinician calls the service desk. The same with the implementation of these comprehensive EHRs and other high-availability systems, that the need for a service desk that operates 24/7 is essential for the user community, and frankly, for the CIO’s reputation.

On the remote hosting side, we’re seeing a lot of hospitals looking at the requirements for meaningful use. Looking at their data center and coming to the realization that it’s going to take a large capital investment to have their data center meet the needs for a comprehensive high-availability system, and they’re looking at other options for that. Moving some of those hosting opportunities to a firm that specializes in healthcare data center outsourcing.

To avoid the capital investment and to have their systems be part of a network that has all the redundancies and business continuity built into it, we’re seeing many CIOs now choosing that as an option.

How does the 24-hour help desk service benefit hospitals?

It provides consistency for the clinicians. Whether they’re working at the hospital at 3:00 in the afternoon or 3:00 in the morning, when they have an issue with the technology or with the application, they have a place to call to get their problems resolved.

The second thing is that it provides a better experience for the end user. They tend to be happier. They even tend to evaluate the CIO in a better perspective. It creates a better experience for the clinician. The 24-hour availability ensures that medicine can be practiced now, not only from a number of times, but from a number of different places. That they’re going to receive the consistent, excellent support that they need to do their jobs.

CareTech supports many Web sites. Are hospitals doing anything creative with them?

They are. It starts with the realization on the hospital’s side that the Web presence is a very important strategy for attracting patients and organizations. It seems that hospitals are understanding what the Secretary of Health and Human Services is saying — that 60% of the Internet traffic is healthcare-related.

What we’re seeing, especially in competitive environments, is that hospitals that understand that a Web strategy and a Web outreach in their community are essential to getting patients into their system. We’re seeing more budget and marketing moving towards a Web presence and some of the interactive Web strategies that are being applied to differentiate the hospital in their community.

What factors make a hospital ready for a successful CPOE implementation?

We approach CPOE assessment from a comprehensive point of view. It starts with the belief that if your processes aren’t well defined and very good, that automating that processes are going to get you an automated bad process. So we start with, first of all, a comprehensive look. We start the comprehensive look at the hospital’s processes. We will do interviews with the department heads, the applicable clinicians, and we’ll actually even survey a number of the end-users to find out where they are from a process standpoint.

We then prepare a gap analysis between what processes needs to be fixed, or we’ll suggest a process that needs to be fixed, and what the automation would look like given the system that they’ve selected. We go about working with the hospital teams to close those process gaps, and then put the technology in to ensure a successful CPOE implementation.

We’ve done this many times across the country, and we found that this upfront work is critical for a successful implementation. We’re also able to have our clients that are moving towards CPOE talk to our other clients that have been there and done that and it helps them smooth out the corners that they are struggling with right now. It helps for a better implementation once they understand all that’s involved in it.

What about the company’s recent “Best in KLAS” award for extensive IT outsourcing?

Well, first and foremost, we recognize that we won this award due to the dedication of the men and women of CareTech Solutions who really, truly, have embodied our motto. Our motto is “Whatever It Takes”, and we believe the results of the “Best in KLAS” designation is a result of the focus and the attention provided by all of our team members who are intensely focused on ensuring that our customer has the best IT experience.

We do a lot of things to ensure that our team members are informed in the direction that the company is heading. We do a lot to share the “Best in KLAS” experiences — or the “Whatever It Takes” experiences, as we call them — and ensure that they understand that in the service business it is critically important that the customer needs to be well taken care of.

What makes your company a good place to work?

The fact is we’ve made CareTech one of the best places to work. First, I would say that we’re in an exciting industry in an exciting time right now. For us, it starts with recruiting. We try to recruit the top people in our industry so that we’re assuring all of our team members that they’re working with well-educated, highly motivated people.

We think that creates a good environment for information technology professionals who really kind of enter into this industry wanting to do a good job. They realize at the end of the day that they’re serving patients and hospitals, and that is a noble mission for an IT professional. The people that are attracted to our industry, I think, and our profession are aware of that. We try to get the top 10% of those folks.

The other thing that we do is we try to provide a very competitive benefits package. Even though the economy right now is very difficult, we look to provide the best for our employees. We have been able to maintain a lot of our benefits and even increase some of those benefits; and make available training opportunities, educational opportunities, and retirement investment opportunities for our people.

Any other thoughts that you’d care to share about the company and industry?

I think this is a great time to be in this profession, in this industry. The public mandates in the American Recovery and Reinvestment Act have provided the funding for our industry to move forward. We’re seeing a mandate on the healthcare reform that has all roads leading to more technology to assist with the practice of medicine.

In fact, we like to say that line between the practice of medicine and technology is starting to blur. For information technology professionals that want to apply their trade in an industry that is helping move the healthcare agenda along, there’s no better time and no better opportunities right now for people in this business.

An HIT Moment with … Ford Phillips

An HIT Moment with ... is a quick interview with someone we find interesting. Ford Phillips is the owner of River Bend Marketing.  

How is healthcare IT marketing different today than it used to be?

Technology and social behavior are the driving forces behind the changes in marketing. In the mid-70s when I started, we had limited media at our disposal, so I used multiple forms of direct mail and print advertising to get my marketing messages to potential clients. Of course, we used press releases, but they served a different purpose during that era. Printing and postage were inexpensive and print ads were reasonably priced. We lived for the postman’s daily delivery of our BRC cards.

There were only about five or six trade magazines focused on healthcare at that time. Modern Healthcare came along in 1976, I believe, and Computers in Hospitals started in 1980. That magazine is today’s Health Management Technology. I was a charter advertiser in both of those magazines.

The advent of the Internet in the early 1980s changed everything, including marketing. Web sites became a company’s window to the world and e-mail addresses assumed a “golden glow.” Today almost every marketing medium my company uses is electronically generated and distributed.

For all of my clients in 2009, I did one large, print direct mail campaign. Everything else was electronic. Almost everyone one of my clients is using some form of social network marketing, something unheard of just two or three years ago. The methodology has changed in 30 years, but objective has not — get the right message in the right hands as cost-effectively as possible.

People often think that "marketing" and "advertising" are the same thing. How would you explain the difference?

People mix up the definitions because they do meld together in the minds of most people. That said, I have always used the following definitions for marketing and advertising. Marketing entails creating and communicating specific messages that position a company and its products’ value, features, and benefits in such a manner as to create a need for that product in the minds of potential end users.

When you pay to get that message disseminated through any medium, that’s advertising.

ARRA has unleashed a flurry of vendor press releases and programs such as interest-free loans and certification guarantees. What impact has this had on vendors and their prospects?

I have read all of the offers. The vendors are simply trying to use the smell of government money to attract as many prospects as possible. Some of the vendors are sounding a little desperate. An interest-free loan? Their products must be extremely expensive. And, how can you guarantee something that is still unknown?

I’m certain the poor physicians are as confused as ever about the benefits of EMRs. EMR technology has been available, in some form or other, for a good while. The percentage rate for adoptions is still in the teens. There must be multiple reasons for that.

The economy is down, but healthcare IT is up. How has that affected your business? What are the right and wrong marketing actions that vendors might take in response?

The majority of my clients see the benefits of continuing a strong marketing communications program in any economic environment. We lost a few clients at the beginning of the downturn. Most of those were due to reduced investor financing.

The right thing to do in a down market is the right thing to do in an up market. In a nutshell, keep your marketing communications program focused. Identify three or four optimum marketing messages and target those messages to prospects who you know can benefit from your product.

Stay on your messages; don’t dilute them. Use the most cost-effective and varied communications strategies you can afford to disseminate your marketing messages to the target audiences.

What are the most important things about the healthcare IT market that new entrants and startups should know?

Be flexible in your planning and execution and be prepared to change directions quickly. Nothing will remain the same, industry-wise or technology-wise. If you remain flexible and can adapt to change, you will be successful in the healthcare marketplace. Not a single technology platform that my clients’ products use today was even envisioned when I started in this industry 30 years ago.

HIStalk Interviews Sheryl Crowley

Sheryl Crowley is VP/CIO of Cape Cod Healthcare of Hyannis, MA.

Cape Cod was Meditech’s first client. What prompted the decision to look elsewhere?

I think it’s the same thing most clients that are still using Magic are facing, which is a pretty significant upgrade if you go to 6.0. Of course, we would all want to be on 6.0 because that’s going to be where their newest and best stuff is. That’s a technical term. [laughs]

Faced with that and saying we wanted to get to a different place in our use of systems, we were in the middle of developing a strategic plan and saying, “This is where we want to get to.” We felt we had to either go to Meditech 6.0 or do something else. 6.0 is really what prompted us to say, “Well, significant upgrade, significant dollars? It’s probably a good time to look at what else is available to us.”

Did you bring Meditech in for your demos?

Yes. Meditech was a part of the process, and certainly a strong contender given that they were the incumbent. Everyone had an opportunity to look at 6.0 in depth, as well as other vendors.

What systems did you consider and what were their strong and weak points?

We considered everything initially. Then we did a preliminary analysis of each vendor and ultimately wanted to see demos from Eclipsys, Siemens, Meditech, and McKesson Paragon. It ended up that Eclipsys was the only one that ultimately didn’t end up demonstrating. They all have pretty comparable functionality, with the exception of Paragon, which at that time didn’t have CPOE or physician documentation yet.

The thing that drove us towards Soarian was really their workflow engine that’s behind that application. The ability to take it — from our demos, our reference calls, and our site visits — to a different level.

Soarian has been viewed for years as a work in progress. Knowing that reputation, was it hard to determine that it was competitive and ready to implement?

Certainly. I think you could say the same about every vendor that we looked at, honestly. I think that we did our homework on each of the vendors and I think our team felt confident in their decision. You know, the proof is in the pudding.

I mean, we haven’t done the hard part yet. Selecting a vendor is pretty darned easy and it’s a lot of work. But I absolutely could not comment today on where I think we’ll be two to three years from now, other than we’re hopeful that we partnered with a good vendor. We certainly did our due diligence to make that happen.

What would you say are the strong and the weak points were of Soarian?

I would say that we thought the strongest points was the look and feel to it. Most people — and this isn’t me speaking, this is my team and my staff and the managers that looked at it throughout the organization — like the intuitive user interface and they like the workflow engine. Particularly, obviously, the revenue cycle piece would allow us to do everything in one application versus what we have. Today we have a lot of bolt-on applications and it just gets very confusing and labor-intensive to maintain all of them. So that was from the revenue cycle perspective. Then on the clinical side, I think they just really felt like it could make a difference in how they do their work.

What is the expected cost and timeline to implement Soarian?

I can talk a little bit about the timeline. The costs are obviously confidential. We negotiated with Siemens, as I think any organization would, and certainly my expectation and theirs is that those were confidential negotiations.

But the timeline I can talk about a little bit because I will tell you that Siemens has been really willing to be as aggressive as we want to be. Our bigger challenge is when can we get the resources together that’s required to do an implementation of this scope and size? So ultimately, this is going to be probably a two- to three- or four-year project as we bring different phases into it and that type of thing.

We’re actually heavy into the details of planning right now and are evaluating, obviously, the operating capital, budget impact, and all of that type of thing, the reality of what can an organization handle in an implementation like this. We’re right in the thick of that right now.

When you said resources, are you going to train your people or are you bringing in other resources or using consulting firms for implementation help?

What we’re primarily trying to do is use our own resources and train them and get them up to speed on the Siemens applications and back-fill legacy support with consulting resources. Ultimately, at the end of the day, we need our people to support this going forward. It’s not a lot of fun for them to sit back and watch somebody else implement it and then they have to support it and they didn’t have the opportunity to really dig into it.

That’s insightful. A lot of people do it the other way. Of course the other plus is you probably have a lot easier access to Meditech resources than Soarian resources. There are a lot more Meditech hospitals out there.

No question, no question. For us, not only did we have access to a lot of hospitals that use Meditech, but I have a lot of people who at one point in time somewhere in their career worked for Meditech because all of their employees are located in Massachusetts. I’ve got some really skilled people, but with very in-depth experience in Meditech. I want to keep their knowledge of our organization and of healthcare, but I want to bring them along and … I mean, we have a lot of non-Meditech applications in our organization, but our core, clearly, is Meditech.

I’ll ask you one more question about cost, and hopefully this isn’t too specific that you’ll be uncomfortable with it. But in the continuum of the least of the most expensive, where did Soarian fit?

I don’t really want to get specific, but what I will tell you is that we did rule out some vendors on initial costs that they brought to the table at the time of the RFP. Everyone was competitive, and that’s why they got in the door to do a demonstration. Whether one was a little more expensive than the other, ultimately those were un-negotiated costs at that point. But they were all very competitive and close to each other in order to get in the door for the demonstration.

I know you started the search a while back, but how much consideration did the HITECH funding fit into your decision?

Interestingly enough, we had developed our strategic plan prior to HITECH. Our strategic plan for IT was done in January, and then the ARRA passed in February. Much of what is going to be required by ARRA was already built in to our plan. Maybe not quite in the order that they’ve decided, but a key component of our strategic plan is adoption. We don’t want to just implement the systems and go, “OK, check, we’ve bought CPOE, we licensed it, and we went live with it. Nobody uses it. But hey, we’ve got it.”

We wanted better utilization than perhaps we’ve had in the past with systems. Our goal was really to do this differently than we’ve done in the past. As far as our process and who we brought into the mix for vendors, they all kind of converged at the same time, but we already knew what we wanted to do before the HITECH stuff passed.

Now that the initial pass of the meaningful use criteria is out, is there anything there that concerns you about your ability to be lined up for payment from there?

Oh yeah, all of it.

What parts do you think are going to be tough for hospitals, especially yours, to meet?

I’m actually in the process right now remapping, because we had actually remapped what we thought would happen to the criteria with the hopes that we would come close. Now I’m going back and saying, “OK, is there anything that concerns me in any of this?” I guess the answer to that is I’m still working on it.

To some degree, we have some of these things and they’re already challenging. Providing access to patient information; we have the ability to do that today. We use RelayHealth, so they can have a personal health record and they can also, if their physician is signed up, see their lab results or other test results. That’s great. We’re a fraction of the way there.

I think the concern I would have with any of these thing is the maturity level that I think we need to be at in order to be able to prove the meaningful use based on the measurement criteria. I think that’s going to be the biggest challenge for all of us. We may have a lot of these things in place or ultimately get there in the next couple years based on our plans.

The question will be, can we measure it in a way that truly proves it’s meaningful; and is that measurement criteria, which that’s the part I’m really diving into now saying, “OK, is that measurement criteria going to work for our organization in the way we had planned to do this implementation, or do we need to maybe change the road map a little bit to make the measurement criteria work in our situation?

Much of the documentation part was pushed off into the future and order entry to the forefront. Does that change your timeline and how do you engage your physicians?

It doesn’t change our timeline dramatically in the sense because Massachusetts has its own regulations which require hospitals to have CPOE in place by October 1, 2012. That’s a requirement to be licensed in the state of Massachusetts. Now that could change, like any of these things, as we get closer to the actual date. Suddenly it gets pushed out or that kind of thing, but I’m sort of planning for it to be a hard and fast date. If I don’t, it could be a challenge at some point. So yes, it’s a concern strictly for our organization.

We have CPOE in two ambulatory areas — our ED and our oncology area — but not in the acute area at all. So for us, it’s totally new and we really have to build that momentum with the physicians. Part of that was getting them involved in the selection process, and they were very involved. That helps generate enthusiasm and willingness to jump in on the CPOE implementation, but that certainly is going to be a challenge.

Will you have someone as the physician champion and the content builder?

We don’t have a CMIO today, but we’re looking at adding one and will have to have it. We need someone to lead that and champion it. We had a couple of great physicians who were on our selection committee who could easily do that and generate the enthusiasm and momentum. We just need to operationalize that into a position that accountable for doing that.

What advice would you have for Magic customers trying to decide what to do, facing the 6.0 upgrade or starting a search?

My advice is make sure they know what their organization is trying to accomplish. I think 6.0 is a great solution for some organizations. It didn’t happen to be the right fit for us. That has, perhaps less to do with Meditech and more to do with our organization and where we are.

I think every organization, before they even look at the vendors, have to know what it is they’re trying to achieve and accomplish. That will tell them should they even convert from Magic to 6.0. Or should they look at 6.0 and other vendors? Every organization is unique. If you don’t know what it is you’re trying to achieve, you’ll never know which solution is going to be the right solution for you.

Last question. When you look around at the projects that you have on your plate and the concerns you have as a CIO, what do you think the future looks like for the next three to five years?

It looks like a lot of work and a lot of pressure on my team and our end users. But I think, hopefully and ultimately, at the end of that period of time it looks like a much better place in terms of our ability to have our system support what it is our organization is trying to achieve in terms of patient care.

HIStalk Interviews John Gomez

John Gomez is executive vice president and chief technology strategy officer of Eclipsys.

 

The HIStalk reader who suggested I interview you said that you are the Steve Jobs of healthcare IT –  the industry’s leader, visionary, and celebrity. Do you see yourself in that way?

No, I don’t see myself in that way. It’s kind of funny, but no, I do not see myself in that way. I guess it should be flattering, but I don’t think I see myself as the Steve Jobs of healthcare.

His reasoning was that the areas you’ve worked in for Eclipsys have thrived, that customers follow what you do, and that employees get your message. Is it good for the company for you to have such a strong customer following and loyalty within the company?

It depends. I’d have to look at the mix of clients that we’re talking about, but I think it’s good. I think it’s great that clients love the message that I deliver, but that message is put together with all of my peers, the teams that I work with. I don’t certainly believe that it’s a one-man show.

I think it’s part and parcel for the company itself, and the company is delivering the message. If I’m the instrument or the megaphone for that, then I’m just happy that the message is resonating and that the people that are receiving the message actually are resonating with what’s being said.

But I don’t certainly think that it’s just me. It’s just the culmination of everything that’s going on around me, and the people that I’m fortunate enough to surround myself with.

Company executive turnover has made you the one constant over the past several years, the continuity between one group of executives and the next. Is there anything that you have to be cognizant of or anything you do differently knowing that you’re the continuity in the customer’s eye?

I don’t know. Although I don’t consciously sit there and go, “Ah, I think I need to make sure this is preserved or not.” I think for as much change as there’s been — and I certainly think all the changes happened for the right reasons — I kind of view it and when I talk to clients about it is that these are evolutionary changes and they’re, in my view, not disruptive.

But that said, I think the one thing that is important, at least from my standpoint — and whether this is me actively doing it or just part of the fact that it’s the way the company’s been operating — is that the message has been consistent. At least for the six years that I’ve been here and through any of the management changes, the messages have continued to be consistent. Now, more than ever, I think that message is going to continue to propel forward. The strategies and the views that we’ve been delivering to clients, that’s something that has prolonged regardless of any changes in the management.

Phil’s been with the company for six months. What changes has he made?

I think Phil is an extremely interesting person as a CEO. He has a strong technical background. He has a very strong financial sales and marketing background. I think he’s able to bring together the different perspectives. I think one of the things he’s been able to do is truly create a cohesiveness amongst the executive team, which is translating into everything we do across the company.

I think more than ever, that we’ve got a very strong synergy between our service and support, development, marketing, and sales organizations. He is also holding, very strongly, more so than ever before, people accountable through the commitments we make to our clients.

Overall, I’m actually loving working with the guy. I’m not brown-nosing if he reads this answer or not. I just think that he’s actually doing a very strong, very good job. Overall, he’s just brought a whole new set of disciplines to the company. I think it’s the right change at the right time, bringing him on board.

As a technology guy who’s worked outside of healthcare, what do you think about an industry that’s dominated by healthcare-only development tools, like MUMPS?

I think it’s time for a change, but I think not just because of the technology around MUMPS. We’ve got products at Eclipsys that are built on MUMPS, although we’re moving off those. I think that there’s a lot of opportunity in healthcare. I think the way that things are done from a technology perspective, we need the change.

I can say it’s kind of a sad situation that healthcare is so far behind the rest of the world from a technology perspective. There’s very little innovation in healthcare around pure technology. There’s a lot around the modalities, but if you think about it, the core essence of innovation doesn’t come from healthcare. That’s really sad because this is the one industry that really affects peoples’ lives every day.

One of the things I tell my engineers all the time is this is the only job you will ever have, even if you work for like a 911 system or for the government, that your code could kill someone. It seems really interesting to me that we have that responsibility in our hands, but yet overall as an industry, very, very little innovation comes from this industry. To me, it’s just upsetting, that kind of state of affairs for us.

Would you say that the limitations of today’s systems are because of their technology, or because of their design? Or, because it’s just the inertia of having to go back and start over?

I think it’s all three and more. I think that we have a lot of hospitals that are comfortable with the technologies that they’ve put in place. It’s not just hospitals. I think it goes across everything from physicians to long-term healthcare facilities. Across the spectrum of healthcare, they’ve become either comfortable or they resist it because of the fear of adopting technology and what that may mean to them in the learning curve.

Which goes back to innovation, it shouldn’t be that hard to implement and embrace these systems and put them to practical use. I think the technologies themselves create very, very challenging barriers to entry. For some cases they’re very old, twenty-, thirty-year-old technologies like the MUMPS stuff.

I think we also don’t pay attention to paradigm shifts. Right now we’re seeing paradigm shifts in other industries, like cloud computing. We’re seeing things scaled down and scaled up to either mobile platforms or large-scale, interactive platform kind of environments. We don’t embrace that. We’re not leading that, yet it can make a tremendous difference to healthcare.

Interoperability is a huge one wherethe way that this industry’s worked, has been not embracing the ability to exchange or interoperate between systems. We’ve been kind of proprietary. I think that also creates a challenge and a barrier for hospitals to move.

I also think that there’s just kind of, at least from a technology perspective — and I’m first and foremost to talk about Eclipsys, but I think we’re fortunate that we have great people — I don’t know if the industry is attracting great technologists. That also creates a challenge through this inertia of innovation.

But if it’s a perfect market, customers get what they ask for; assuming that someone would step in and give it to them if the current vendors didn’t. Are hospital customers too easy on their vendors?

That’s an interesting question. I think hospitals could push vendors much, much harder to drive the evolution of technology. I think there’s an inherent responsibility that when you work in a healthcare facility or a healthcare information technology vendor, that your responsibility is at the end of the day, to try to get the best quality care for the patients that are using that technology. If you’re not driving the vendors to innovate and evolve their product lines and embrace new technologies, then I think the hospitals are being too easy.

The studies that have come out in the last couple of weeks are suggesting that systems are not meeting expectations for improved quality and reduced cost. What should hospital software vendors do if that’s true?

If it’s true, it probably goes down to a lot of the cryptic things that you just see in a lot of the vendor systems. They’re difficult to implement, they’re difficult to configure, it’s difficult to maintain online. Quality is not what people expected it to be. The usability is, in some cases, ten-, fifteen-year-old paradigms. Those kind of things need to change, right?

The vendors need to be in a position where they’re affording people solutions that are usable, and if they’re usable, I think you can drive adoption. When you drive adoption and you can apply technology to patient care, you will translate it to better outcomes. I mean, we’ve just touched the tip of the iceberg in terms of using things like analytics or predictive informatics or diagnostic decision support instead of clinical decision support.

If you look at the Gartner Scale, there are very few vendors that are Generation 3. I think there’s only three. I could be wrong on this, but I think it’s us, and I’m thinking Cerner. Generation 4 is what vendors should be striving for. HIMSS Level 6 is just starting to become something that most vendors are able to do, and really, they should be driving for HIMSS Level 7. The hospitals should be using and applying those tests and saying, “This is where we want to be. This is our vision, and we’re just not going to buy from anybody that doesn’t allow us or enable us to get there.”

You mention data; and everybody wants to use data, but not be the one to have to create it. Eclipsys is pretty well acknowledged as the CPOE expert. Is that paradigm valid, or do you see anything changing that makes that somewhat of a dated concept itself — the idea that physicians need to type into a system to be able to reap these other benefits or provide someone else some benefits?

I think that yes, things have to get easier for physicians to want to enter the data or provide the data. I think that’s a great way to paraphrase it. Until we lower the bar or the difficulty of the user of the system to enter that data, then we’re not going to have the richness there. We’re not going to have the full picture that allows us to treat patients effectively.

What’s interesting is we’re kind of in a situation where if we can lower the bar, get people to provide the data in easier and easier ways, it actually helps all of us long term. Not just as vendors or hospitals, but even our own interest.

At some point, we don’t just want to look at episodic care, we want to look at womb-to-tomb kind of care and long-term care. The more data we have, the better outcome we’re going to have individually. Then when we go to a doctor or we go to a hospital we want that level of care, yet we’re not, in most cases, doing anything to enable it.

From an Eclipsys standpoint, we are doing a lot to try and lower that bar. There are technologies we’re looking at and changes to the way that we’re collecting data and allowing providers to be immersed with an experience that hopefully will start making things much easier to do. I appreciate you saying we’re kind of the experts in CPOE, but I don’t think we can stop. We have to keep pushing things further.

When will we see what kinds of things that you’re looking at in technology?

From an Eclipsys standpoint, not to be a teaser or things like that, there are a variety of things that we announced at our Eclipsys User Network around visual workflow and our new solutions platform and where we’re headed with that.

But in terms of the UI, we’re doing a lot to move our UI forward. Now one of the challenges for any vendor is that you don’t want to create disruptive change because that becomes very costly and becomes, in and of itself, a barrier to the healthcare institutes. What we’re trying to do is take an evolutionary approach to our UIs and incorporating usability as we go. But some of the things you’ll see in our next release are that the UI adjusts to you, it learns from you depending on where you are in the system.

One of the other things we’re doing is working on a concept of Workbenches, which create an immersive experience for a particular type of provider. So if you’re a nurse, the assistant is tailored to you as a nurse and reflects the support of your workflows. If you’re a physician, it supports your specific type of workflows.

The other thing we’ve been working on for a long time is thinking through how we can apply gaming concepts to the UI. In fact, one of the key things in terms of getting data or responding to data that involves a patient is being able to present information in the UI in a way that doesn’t overwhelm the practitioner. So we’ve been working very hard on providing the right information at the right time for whatever that practitioner may be doing in terms of their scope of the workflow.

Those kinds of changes have to be very specific. We hope you’ll start seeing some of those things come to market in the Q1 timeframe, and then we also have some things slated for the Q3 timeframe in terms of uplifts to usability and things like that.

Wall Street has typically punished publicly traded companies that rewrite. Is the technology there to allow those sorts of changes without really scrapping the database and the underlying architecture?

We started back in what, 3.5, which was about 2004, and we’re now coming to market in Q1 with our 5.5 release for our clinical solutions. We’ve been evolutionary all along, and so we’ve introduced things like ObjectsPlus, aligning third-parties that develop applets. We opened up our MLM library to allow people to develop these kinds of self-contained macros. We’re building on top of that. Our platform, going forward, we’ll continue to move those things forward.

One of the big areas that we’re investing in now is opening up the APIs so that they’ll be a service-oriented architecture. We very, very have seriously been looking at cloud computing and seeing how we can invoke that and provide kind of a healthcare information technology as a service.

None of these are disruptive. I mean, we’ve had a great legacy of our upgrades just being in-place upgrades and not requiring you to do schemas or lose the work you’ve done or redevelop the add-ins that our third-parties or our clients build. We want to just keep going forward, and the big thing we’re trying to do is open up the platform, allow for third-party innovation. Hopefully, we’ll even have competitors build on top of our platform.

We’re charting a course where none of that will occur with disruptive changes. I think there’s a time and place for disruption. I don’t think this industry is, right now, ready for disruption as they’re trying to get their arms around everything going on with the government trends and outcomes and everything else.

Some people would say that a lot of the reasons the same old systems keep selling is that IT departments want to avoid risk and perceive that that’s less risky. Do you think that that whole concept of extensibility versus just buying everything from a single vendor, even if it’s not very good, is going to be a message that will resonate with the right people who make hospital decisions?

I think you’re starting to see both. I think you’re starting to see that kind of the larger hospital systems are taking risk in saying, “Look, we’re going to change and swap out systems.” They’re starting in probably the departmentals because they’re seeing the benefits of fully integrated applications.

We’re moving down the path very strong. We have a fully integrated platform. That said, though, if you’re going to have innovation and you’re going to really drive vendors to continue evolving, I think it’s really rare where you can have one vendor that is going to continually innovate as such a pace that it will allow you to meet the needs of the hospitals in terms of patient care over the long-term.

You know Apple — you mentioned Apple at the beginning of the talk — Apple’s a very unique situation. They get innovation right and they’ve been very good and strong at what they do. I think it’s hard to replicate Apple’s success, so the answer to that is have an open platform.

Sure, you can go with integrated; you can go with single-vendor, but never tie yourself into a position where you can’t innovate on top of the platform that you’ve chosen. That openness should allow you to bring in third parties, to build your own applications as the institutions, but protect you from not being locked into a single vendor solution.

The company invested in EPSi and practice management. Are those key to the single strategy, or is that just a way to broaden the front that you put out to customers?

It’s kind of both. From one standpoint, we’re working right now to natively integrate those offerings, but the way we’re doing native integration is that everything can also stand alone.

For instance, EPSi will be integrated with our core solutions platform, so it means it’ll share security and auditing and other pieces of our platform with all of our applications. If you were to buy EPSi and you didn’t own any other Eclipsys app, when you install it, it’ll lay down the core platform. If you buy another application from us, then it will use what has already been put in place. You don’t have to redefine security. You don’t have to redefine auditing or roles, or places within the hospital or anything else — cost centers or cost codes, billing codes.

But that said, if you were to just buy EPSi and you wanted to integrate a third party, you should be able to do that without having to buy anything else from Eclipsys. So, we see that. EPSi certainly pushes forward our ability to move into new market areas and integrate in places that don’t previously own Eclipsys products. We also see it as a complete offering on top of an integrated platform. That core comes from Eclipsys so, there’s a little bit of both.

Do you see any possibility that either customers or third parties will develop open source components that work with your products?

That’s a really interesting question. For us, one of the things we announce at the Eclipsys User Network was the Eclipsys App Exhange, which will roll out in Q1. The App Exchange will be an opportunity for not only clients, but for third parties to actually build applets or MLMs or visual workflow add-ins and things of that nature on top of our platform.

If the third parties or the clients wish to put that into the public domain or license it specifically as open source, it’ll be their choice. We won’t regulate that. It’s very similar to the Apple Apps Store concept. We have not worked out yet whether or not we will invoke a commerce engine on top of our platform.

For now, we’re just seeing that clients can either exchange content or applets with each other, or get them from third-parties and then work out the revenue model between themselves. What we really wanted to do is be a facilitator and take the work we’ve done in the platform and now extend it out to third parties.

We’re talking to third parties now, who actually are competitors of ours, and they’re learning about what we’re doing and they’re saying, “Ah, this actually would reduce my cost of ownership because you guys are going to do all the plumbing work. Then, I could just snap on top of you.” What we’re saying to them is that’s great. We’d be happy to have you on the platform, but we may compete with you.

So far we’ve gotten feedback that people are saying, “Well, then let the games begin.” I think that kind of stuff is great for healthcare because it lowers costs, it opens things up, third parties can innovate, and hospitals aren’t tied into a single solution at any point in time. It kind of feels like it’s the right kind of place to be doing this.

Does Eclipsys have what it takes to compete for the long haul against some pretty formidable and well-funded competition like Epic and Cerner?

It would be hard for me to say no to that question, but my honest gut-level belief is yes. Think of it this way. Our clinical are considered the best in breed. One in four physician orders, I believe, in the US electronically placed is placed on an Eclipsys system. We’ve been improving steadily our KLAS rankings. Our customer satisfaction is up. So from that perspective, we’re doing all the right things.

We’ve just now announced the new Sunrise Financial Management product that comes out in early 2011. That’s our full-blown revenue cycle system with ambulatory billing and international support, fully integrated into our clinicals. Not interfaced, but true integration.

We’ve got fully object-level integrated pharmacy. We’ll very shortly have fully-integrated lab. Then on top of that, we’ve got one of the few fully-integrated clinical analytic packages, which will allow you to do data warehousing out of the box; do all your core measures and do visual query by example.

Then you’ve got the EPSi and the Premise workflow stuff on a single platform. On top of that you’ve got the visual workflow tools which will allow you to use Vizio-style diagramming to actually visually draw your workflows.

On top of that, that visual workflow tool can work with any web service in the world. It doesn’t matter whether it’s an Eclipsys web service or a third-party web service. So I look at that and I go, “Wow, that’s the breadth of the platform and we’ve got a very strong vision of where we want to go.”

We’re lowering the bar in terms of how usable the system is and allowing third parties to create an ecosystem through the Eclipsys App Exchange. I not only think we have the ability to compete with the Epics and the Cerners and whoever else may come along, I think in very short order they’ll be wondering like, “Holy crap. What have we been doing all along, and how are we going to deal with this?”

What does Epic have to do to stumble enough to let somebody else get back into the big-hospital game?

Good question. I’ve met Judy a few times. I think she’s a very, very brilliant person. She’s doing a great job at what Epic does. I think that right now, Epic’s situation is that they seem to be doing the right things, but I’m not really sure they’ve done anything hard.

I think they’ve gotten some preliminary implementations done. They’ve done some good large hospital implementations. But when you get into the real serious acute care, when you get into the real treatment of very, very sick patients; to the best of my knowledge, I don’t know if they’ve proven themselves yet. So it’ll be interesting to see where they go with that.

We’ve been doing long-term care, long-term disease management, critical care, oncology; you know, real in depth stuff for a very long time. Now we’re pushing very, very, very actively into the ambulatory market. So it’ll be interesting. I think it’ll be, through the next two to three years, a very interesting battle. I’m not sure if I, specifically, would feel comfortable saying that if Epic does these three things, they’ll stumble. But I think that there’s a short-term…

I would compare Epic to Netscape in that they were kind of an industry darling for a long time, but then when people wanted to get to the next level of the Internet and really start pushing things really hard, Netscape didn’t seem to be the answer. We’ll see if that turns out to be reality or not, but the reality is I think they’re a great company and Judy’s a great person. The people I’ve met from there are really talented people, so it’ll be an interesting competition.

The problem is they’ve taken away this window of time that’s driven by everybody’s first big clinical implementation and the HITECH possibility is there. They’re grabbing all the big customers who aren’t going to just dump them after they’ve spent $50 million. Are there going to be enough customers left to buy somebody else’s innovative product?

I’d let somebody else in the company talk to our financial sales, but from what I’m seeing, I think you will see that we continue to have strong, steady growth. The piece in terms of, are there other people left, right now there are selection processes going on that we’re beating up again. It’s actually good things.

We’ve introduced the “Speed To Value” methodology which reduces our implementation timelines by a dramatic amount and improves the quality. We’ve introduced a warranty that helps provide and drive our ability to assure that clients will get HITECH certified. I think if anything, we probably just aren’t talking up enough all the things that we are doing. But I don’t see that, “Wow, Epic’s doing all this stuff and Eclipsys isn’t.” So if anything, I think we just kind of walk a silent path and just keep doing what we’re doing. So far what we’ve been doing seems to feel and be on the right track.

Do you think offshoring of development has done as well as everybody expected?

I think we’ve learned a lot about offshoring. At this point, it’s just another office. The one thing that I think has helped us is we’re being able to bring a lot of young talent on board. That’s helped a lot with our ability to actually evolve the platform and evolve the other things that we’ve been doing.

I think that if I were to do it again, I might approach the problem differently, but I would certainly do it. I don’t think there’s anything in my mind that makes me go, “Wow, we shouldn’t have done this,” or “I would never do this again.” So far, it’s been an effective tool, and at this point in time, it’s another office for us.

We have development teams that have different geographic rotations. We’ve put the technology in place, like Cisco TelePresence and other things, to help coordinate those teams. We’ve got strong management layers in place to assure that those teams are held accountable. At this point, our offshore teams are no different than any of the other teams that we have.

Last question. What would you say the most important priorities are for the industry? Or what should they be over the next five to ten years?

I think interoperability’s huge. If you can’t interoperate, it does put hospitals into a position where they’re stuck with a vendor. If that vendor doesn’t get it right, it becomes really hard to whip into place. So proprietary systems that are not open and don’t interoperate with other systems, I think, are a tremendous detriment to the industry itself and so forth.

I think the second thing is we’ve got to make it really easy for people to adopt the technologies at all levels. If we don’t do that, then we’ll have great systems that can talk to each other, but no reason to talk to each other. I think usability has to be addressed. We have to see more innovative user interfaces. We have to have systems that are helping physicians and not just providing data and just kind of being like a ledger.

The third thing is I think we’re not really recognizing the value yet of home health and integrating the patient more directly into the systems and the technologies. I think the third big area that we have to concentrate on is the integration of the patient into the system, and kind of reaching out to the patient. This goes way beyond portals or mobility, I think, which is not really reaching out to our own healthcare opportunities.

Those three things, I think, will probably be the big priorities that I’d love to see. I think it would fundamentally change how healthcare information technology’s done, and thereby, help transform healthcare in the United States.

An HIT Moment with … Tony Cotterill

An HIT Moment with ... is a quick interview with someone we find interesting. Tony Cotterill is president and CEO of BridgeHead Software.

Should data storage be a strategic issue to the average healthcare CIO who is knee deep in planning and budgeting for electronic medical records, interoperability, and Meaningful Use?

None of these top priority issues brought about by ARRA will succeed if the underlying storage of data is not fully managed. In fact, interoperability is founded on multi access to common data generated by one application and required by another. Without a data management strategy, a hospital that’s struggling to prove meaningful use will quickly find itself overwhelmed with digital patient data. Ironically, if these new electronic patient records can’t be accessed quickly, this may result in decreasing quality of care instead of the improvements that electronic medical records are supposed to bring.

A vendor-agnostic managed data store is fundamental to a hospital’s quest for a smooth running and useful electronic health record system.

If you were advising a CIO about storage and disaster recovery as these new applications come online, what would you tell them to think about, including cost, space, and growth?

First, I’d advise the CIO to look around the storage devices already in his/her data center and figure out how to maximize their utility, paying particular attention to the primary storage tier, which is the most expensive to maintain. We’ve done studies that reveal 60% or more of the data on tier 1 storage is static and hasn’t been accessed in more than 90 days. That data is being backed up nightly or even more frequently, so time and resources are being wasted.

Typically, archiving static data can delay the purchase of more tier-1 storage for 12 to 18 months by the space it frees up for reuse. Also, using archive alongside replication and backup as part of a DR strategy streamlines disaster recovery and enables optimized use of less expensive storage assets for static data.

Disaster recovery with multiple points-in-time copies is going to be become key as people migrate to the brave new world. Failures are inevitable and the last thing that anyone wants to do is to have to start again. The sheer volume of data that is now involved means that traditional backup and replication methods will not be fast enough for the frequency that is needed. Only by moving the unchanging data to a protected data store can you relive the pressure on backup to get the number of copies that you need.

Who are the main players in healthcare backup and archive solutions and what are their competitive differentiators?

The main players in healthcare backup tend to be the same ones you see in other industries: Symantec, EMC, CommVault, to name a few. In archiving, it’s these same players as well as other systems providers in partnership with middleware vendors (think HP MAS or IBM GMAS).

When you talk about competitive differentiators, it’s important to keep in mind that these vendors are all offering a horizontal technology (backup and archiving) into one of their many vertical markets, in this case healthcare, and to varying degrees they succeed or fail in addressing the unique needs of Healthcare IT. At BridgeHead, our only vertical is healthcare, so every day we wake up thinking about how we can improve our backup and archiving solutions to serve the needs of healthcare.

How is healthcare different from other industries in terms of data retention, retrieval, and recovery?

The basic requirements are the same — that is, different data types have different retention periods, privacy rules and access requirements. However, in healthcare, data retention requirements are somewhat unique in that there are multiple federal, state, and organizational regulations that govern how long data must be retained. Therefore, it’s essential that an organization’s data management tools be easily customizable to accommodate that variation.

As for retrieval and recovery, ease and speed of access are critical in healthcare since we’re talking about a patient’s health information, and potentially a life or death situation. Privacy is a particular conundrum in healthcare with a requirement for data sharing between healthcare professionals sparring against the need for patient privacy.

Storage devices use a lot of power. Are they an obstacle for organizations that want a greener data center?

‘Obstacle’ is putting it mildly. It’s really hard to create a greener data center when you’re dealing with such power-hungry devices, especially in the face of the rapid data growth that healthcare is experiencing. One of the topical ways of decreasing the local consumption of resources is to move the storage to the cloud, but are you really decreasing aggregate consumption under that model? An alternative strategy is to use storage virtualization to optimize the use of the devices that are already in place and, as a result, delay the next storage purchase for a year or even longer.

The goal with the data center — whether through a green initiative or not — should be to maximize storage capacity using as few resources as possible, so it behooves the CIO to research the consumption profile of the storage devices they’re considering before making a purchase. In fact when you consider that any data over 18 months old is unlikely to be accessed ever again you must ask the question, why do we have it mounted and spinning at all, why not have it offline on removable disk, optical disk, or tape. Access times in a tape library or jukebox are probably still quick enough for this kind of data.

HIStalk Interviews Jeffrey Robbins

Jeff Robbins is founder, president, and CEO of LiveData.

Describe LiveData’s business.

LiveData’s really got two lines of business. Relevant to your readership is our healthcare business. We also got our start, and continue to service, the electric power space with a trusted real-time middleware that’s used all around the world on the electric power grid. That’s actually how we got our start in healthcare.

We were posed a challenge by folks at Mass General, who in collaboration with CIMIT had an “Operating Room of the Future” project. The paradox of new stuff is the more new stuff they brought in, while they had increasing numbers of really great new tools in the OR, the challenge was how to actually pull it all together and use it. So they posed to us the challenge: could we pull all this different kinds of data in real time onto one screen? To which, as CEO I said, “Of course.”

Then we pulled back to figure out, well, how’s that going to work? That launched us into healthcare about five years ago.

What is CIMIT?

It’s a collaborative group that involves Partners HealthCare, the parent organization of Mass General, along with MIT, Draper Labs, and other stakeholders. Their mission is to try to find technology, sometimes outside of the traditional healthcare space, and bring it to bear on healthcare.

I’ve been hearing about “The Operating Room of the Future” for years. Has it produced technologies that are actually being used?

Well, that’s a nice softball for me. [laughs] Certainly one of the outcomes of that project at Mass General was Mass General deciding for their new operating rooms — they put this in their RFP for equipment for the new ORs –to standardize on having LiveData OR-Dashboard in every room. LiveData OR-Dashboard is the product name of what came out of that research.

I should say that the way we were enabled to actually work on this was through a generous grant from the U.S. Army’s TATRC Group. Through the SBIR grant process, we competed for and won a grant that allowed us to take our technology, which was already proven in the electric power space, and tailor it to the healthcare environment.

Everybody’s pushing doctors to use EMRs in their practices. Is anyone advocating OR technology?

The OR, in my opinion, is still in some ways the Wild West or the last frontier. It’s kind of a black box that’s definitely under the dominion of the surgeon. It’s widely recognized that they’re very obviously a delicate area of care. Changes come to it carefully in the hands of hospital administration.

You really do have a dedicated team of professionals among the doctors and nurses who take excellent care of each patient. Trying to get electronic stuff in the mix has all the pitfalls that I’m sure you’re aware of, where you can’t simply create an electronic version of the paper stuff you already have and expect to see better things happen.

You really do have to look at the workflow and find ways, creatively, that automated systems can actually help and reduce workload, not simply add more burden, because now all of a sudden someone’s supposed to not only do critical things on their feet, but then run over to a keyboard somewhere and type a description of it. I’d say that’s what keeps the OR somewhat on the outskirts of a lot of the efforts I read about in your paper.

As you said, physicians often find EMRS cumbersome and not meeting their workflow. Do you find the same challenges with surgeons in the design of your product?

Yes. We set out deliberately to address the gap between the “doing” and the “documenting”. When we started, our product was really a read-only display that derived its information automatically from other systems, be it documentation systems where a nurse was already documenting, or in some cases the physiologic monitor or anesthesia machine. Building up more information out of existing sources without requiring any new typing. That was kind of a first leveled effort to say, “For sure no one’s going to have to do more work with our system. Let’s see if we can’t help anyways.”

Then the next step was to try to see if we couldn’t reduce the amount of work involved in certain documentation steps, with our focus at first being on the Safety Time Out, which has, I think, increasingly gotten press and awareness. 

What’s the value of putting the lists in an electronic environment, as in your Active Time Out function?

There was a by-now famous study that was spearheaded by, among others, Atul Gawande out of Boston here, out of the Brigham more specifically, and also at Harvard. Brigham, being one of the teaching hospitals, it was Harvard. But the study showed that through the intervention of adding specific kinds of checklists to the surgical process, you could reduce errors and ultimately save lives and reduce complications. That’s a wonderful result and everyone gets that we need to make sure that everyone’s doing these checklists properly.

But the study itself raised the question, “How do you engineer durability into the system?” and what does that mean? If you have someone with a clipboard watching you while you work, seeing how well you actually execute a specific checklist and you’re aware of that fact, my guess is like most humans, you would start paying more attention and be kind of on-the-spot and do it.

The question is, when the person with the clipboard leaves, who’s checking to make sure you actually keep doing this checklist? Effectively doing the checklist does help. The question is, what helps people stay on task and actually do the checklist on each and every case? That’s where, again, new ways of doing the checklists using electronic technology to help and augment the process can really make a difference. That’s what we’ve been doing with our hospital customers.

For example, we give the circulating nurse a simple clicker, kind of like a PowerPoint mouse, very inexpensive, very simple. During the Time Out, the nurse literally clicks through the checklist which is up on the wall on a screen. How that differs from having a poster on the wall, let’s say, with the checklist on it is for each step in the checklist, the relevant information for executing that check — like making sure that the proper antibiotics have been given prior to incision, as an example — the system literally scours the records of the documentation to make sure that there’s indeed a record of the proper antibiotic being given and puts that up on the screen.

Simple stuff like patient name, MRN, whatnot. Rather than just having a checklist that says, “Make sure you know who the patient is,” we get the patient’s name and in some cases, even a picture of the patient up on the wall so you can confirm that you have all the salient information to do that step of the checklist.

That’s Part A of it, having all the relevant information available automatically. Part B is, this could sound a little Big Brotherish, but it’s being handled with a lot of sensitivity by our hospital customers — we provide reports for administration as to how long was spent on each step of each checklist item for each case. You actually get beyond the documentation saying, “Yup, we did the checklist; we did the Time Out.” You get some time-based statistics. Did the checklist get done before incision? How long was spent on it? You pretty quickly get a feel, as a team in the room, for what the right amount of time is to spend on a checklist, and you can then start to tell when something really wasn’t done properly.

The hospital that recently got into trouble for not doing surgical time-outs or marking their sites surely knew they should be doing that. What would you suspect caused them not to, and how would your product have made a difference?

Well ultimately “they” — the hospital — devolved into individual surgeons who often aren’t even employees of the hospital, but obviously have privileges to operate there. Our system helps people stay on compliance with the policy and provides a record for each and every case of that actuality. It’s moving, and it’s a culture change, but its part of the hospital making the decision that yes, we shall really see that this happens on every case.

Can the tool change the culture or does the culture have to be ready to accept the tool?

As much as I’d love to say yes to the former, it’s really the latter. No matter what kind of technologies they have, the culture change is ultimately people and processes. Technology is really an adjunct. But again, my point is that technology done right is a useful adjunct that doesn’t add more work. It’s still salient to that discussion about, does the electronic medical record hinder or help our health?

Take me through a typical surgery. What is your product doing and how are people using it?

The product in the OR is part of a bigger suite of products that are all about workflow in the perioperative space. In the OR, the workflow is divvied up into some very high level phases or steps, which we call Set Up — when the room is being set up. The checklist phase. Intraop — the actual surgery is underway; debriefing and some ancillary stages prior to sending the patient off to the PACU. Some of these other phases might be in their own time frame and pop in and out.

For example, there’s workflow associated, on some cases, with sending a specimen from the OR to the pathology lab. The system will, when that’s going on, switch automatically to some information about managing that flow back and forth between the OR and the pathology lab to make sure the specimens had been marked and described the way the surgeon wants; to let the surgeon see where his or her specimen is in the pathology lab’s queue; and then ultimately to get results back from pathology in a way that the surgeon can easily see and have someone in the OR sign off on.

That’s like a detailed dive on one piece, but the major steps again are: the room setup, where the goal is to make sure all the right stuff is in the room. Then once the patient’s in the room, the briefing/checklist phase, to make sure that’s all done properly. Then Intraop is largely details of the case that unfold during the case — highlights of the patient’s vital signs, estimates of any fluid loss; and depending on the kind of case, there might be more details.

Let’s say in an orthopedic case you might have an automated tourniquet pump on for a certain period of time at a certain pressure, and that kind of data can be gleaned automatically and displayed on the wall so everyone can see it, that kind of detail about the work. First of all, we talked to different people in the room and asked them, do they need that? The anesthesiologist has his or her own bank of screens from the monitors; they don’t really need that. The surgeon might think they don’t need that, and often they’ll say that to us, “Oh yeah, I don’t need that.” But once they have it and you observe them during cases, you’ll see they start using it quite frequently just to stay aware.

Most crucially, nurses, some of whom might be changing shifts in the middle of a case or relieving someone who’s going off to lunch, can get kind of a high-level Gestalt of “Where are we in the case?” in one place, versus what they could do in principle, is log into several systems — the record, so to speak — and rummage and try to find out what’s going on that way, or talk to people. But I hope no one’s under the delusion that there’s a lot of that kind ad hoc conversation going on in the OR, because there isn’t — so metaphorically, keeping everyone on the same page.

People have said that critical IT systems should work like a pilot’s heads-up display or as in real-time instrumentation that detects events and alerts. Is the industry moving in that direction?

We feel we have delivered in our product is that heads-up display. I would argue that certain kinds of IT systems already in place in the OR are, correctly, heads-down products because they’re documentation products. Certain things do require a nurse to heads-down and type.

We’re not yet at a point where voice recognition is good enough in that kind of noisy environment, and so there are places where things need to be typed in. That, to my mind, is inherently heads-down, yet there are pieces of what are being typed that are really more high level events that should be monitored and then used.

We use them, first of all, to know what phase of the case we’re in to automatically display the right subset of information. But then, like you say, to have alerts. So if we’re getting to the Time Out before incision and there’s no documentation of antibiotics being applied — sound an alert, let’s find out. You could say, “Hey, you’re actually helping to make sure they gave antibiotics.” Well maybe, but maybe more likely we’re helping make sure that someone actually documents correctly what’s already been done. So somebody’s been given antibiotics, but no one’s documented it yet. Our system serves as a reminder to get that done.

How much overlap is there with traditional surgery or periop systems, and who do you consider to be your competitors?

We’ve actually had discussions with some of the CEOs of the existing periop documentation systems who have told me that they don’t see it as overlapping, and they see it as a logical add-on. Yet if you talk to some of the other larger companies who, it’s all just software, right? At some level they have everything, at least on the drawing board, and they’ll tell you, “Oh yeah, we’re working on something like that.” But I don’t think any of the current well-known companies could claim to have something exactly like this running in a hospital.

Another technology that outsiders seem to be amazed that healthcare doesn’t have is real-time video and data capture for review or teaching or malpractice defense. I noticed your Historian product offers that. How are customers using that?

We’re not directly supplying video recording. What we’re doing is essentially adding automatic data bookmarking to what exists in video logging products. For example, our product is in the market with our distribution partner Karl Storz and they have a line of products called AIDA, which are video loggers. So that’s an example.

In specific instances that hospitals interfaced with other competing video logging systems that other companies do sell into the ORs, there are basically DVD recorders in many ORs replacing the video tape recorders that used to be there. But I think, as you were kind of leading towards, it’s the old-style kind of tape — label it by hand; the surgeon keeps it in his office, maybe shows a clip at a conference.

The next step, we believe, is to make the video part of a richer data record. At the very least, so that you can easily find the salient stretch of tape or image that you want. One of the problems with logging things is you end up with miles of images that nobody ever goes back and looks at. So by merging the data-oriented bookmarks of knowing when the Time Out’s done, knowing when they’re closing, knowing when the physiologic monitor first picked up the pulse-ox or whatever, you can actually rapidly scan ahead to where you want to be instead of wading through a lot of empty air time.

Final thoughts?

I think you already said it for me, but I’ll repeat it. The electronic medical record in many ways seems, from my vantage point, to be somewhat stalled in that documentation phase. It’s really taking that electronic data, fusing it from several sources, applying rules to it, and acting on it that I think starts harvesting the goodness of it and makes it more than just this added documentation burden. Instead, it makes it part of the care delivery system that we’re really excited to be part of. I’d say that’s the exciting trend that is enabled by the correct deployment of electronic records.

HIStalk Interviews George Huntzinger

George Huntzinger is CEO and partner of The Huntzinger Management Group.

You’ve been in the business a long time. Tell me what lessons you’ve learned that newcomers would benefit from hearing.

The consulting business is really an interesting business. I’ve been in it since … I’m going to say 1984. Actually, it was probably before that because we did consulting at one of the software companies I ran prior to that. But it’s not an easy thing to do. A lot of people go out and try and start consulting companies from scratch. They do it with minimal experience and they find out right away that there’s a real science to doing this.

I think it takes people with some good experience who have had the opportunity to work for large organizations and have been successful at what they’ve been doing before. Who have had a good track record and mentors and people that have coached them along through the whole process. Who have experienced all the various things that you can conceivably experience in virtually growing and building a consulting business that is servicing whatever market or markets they choose to serve.

I guess the key thing is experience. It’s having been there, done that, and having enough experience to know that when you’re going at something, you know when to stop investing when you hit something that isn’t worth investing in, and knowing where to accelerate investing when it makes sense to crank up the burner a little bit from a financial perspective. To go at something hard and go at it hard in the right markets, and usually come out on top of that — if you read it right.

People start up their own small consulting outfits because they need a job or just wanted to work for themselves. How many of those succeed? What does it take to make a real firm out of it and not just a few people selling time?

What I think is really interesting is the world’s kind of a funny place and there’s space in it for everyone, so to speak. We have employees today that only want to be employees and never want to do anything. They’re very good consultants. They enjoy doing what they do and they never want to aspire beyond being the best consultant that they can be and they always want to be employees.

Then there’s other folks that we bring into solutions that we’re providing to our clients and they come in as subcontractors, so they single-shingle it. There’s some people that single-shingle it, but don’t want to be anything more than just that. I guess they want the freedom of being an independent. They want to be able to move around, and they want to be able to operate solely as a business as a sole-proprietor. 

You’ll find a tremendous amount of consultants out there that fall into that category. They’re not really interested in doing much beyond that other than taking on an engagement or two that might require one or two of their buddies to come into it that they know, to help them to fulfill something they can’t fulfill by themselves. I can name twenty people in that category today that just, are satisfied doing that.

What would be the advantages or disadvantages of a really small, maybe even a one-person shop, versus a real ongoing concern?

I think a lot of it has to do with freedom. As an employee, you’re wrapped up in all the controls that are put on you as an employee. So you’ve got your vacation limitation, you have your personal day limitation, you’ve got whatever benefits that people are putting in front of you — they’re the benefits you get. It’s the package that you’re buying.

You’re also buying security when you’re part of that, so that’s a really nice plan for people who also need people to be around them to prosper and grow. They’re not as independent in their thinking, whereas when you walk on the — I’ll call it the subcontractor or independent consultant — side of the fence, where they’re a small business unto themselves, they have basically ultimate freedom. They can buy whatever benefit package they want to buy. They can spend as much or little on it as they want. They can take as much vacation as they want to take. They can work on a project, then take a month off if they want to.

There are freedoms there that you have, but yet still get to work on projects with people and do things and interact and interplay with various resources. You know, fulfill that side of the needs in your life.

Should a customer care about if somebody makes a pitch and says, “Hey, it’s just me and I’m hands-on and you get me and not somebody else. I’m cheaper by the hour”?

It all depends on what the customer is buying. It’s a good question. Our business, we’re not a staff augmentation company, so that’s not where our head is today. I’ll just speak by way of example. We’re an advisory and management services company, where we assume full accountability and responsibility for either running a given function or running a given project or function. We’re taking on that role. Whenever you take on that role, they want somebody who’s really committed and there, and has a little depth behind the organization.

Because when you put that transaction together, there’s usually a little bit of risk that you’ll take and put some deliverables at stake. Some risk for meeting certain deadlines or making certain deliverables happen, or achieving certain goals that you lay out in your contract. They’re going to want some meat around that when they contract with you. That’s usually not a good environment for an independent, sole practitioner to flow into.

They’ll usually contract with the Huntzinger Management Group for a project that takes on and maybe requires six or seven resources to be deployed because you’re assuming full responsibility for accomplishing whatever it is they want you to accomplish. In that, you may bring in four employees and two subcontractors, but the Huntzinger Management Group is 100% at risk for doing that. The client is more willing to sign up with an organization who does that for a living, whereas an individual usually fills a staff aug spot.

Or, if they’re a project manager, they’ll usually not take on a key leadership role as a project manager. They’ll be a project manager as part of a team. There might be seven or eight project managers onboard along with a project director that oversees everything. It’s very hard for an individual to take on full accountability and responsibility for a given thing because they don’t have total control of it.

Do you think the cycle will ever end where consulting firms sell out to bigger companies, then bring back most of the people to form another consulting company?

You know, everything has a life cycle, doesn’t it? What we’ve experienced in the 20-25 years that I’ve been running consulting or running businesses … I spent a good portion of my career at Computer Sciences Corporation and I ran their healthcare business for 14 years. When we started there it was $10 million, when we left there was close to $400 million, so it was a nice run.

You saw Superior grow and prosper. You saw First Consulting and Healthlink or IMT Healthlink kind of grow and prosper, and then all get absorbed into these larger corporations. It’s interesting because a lot of the larger corporations create an environment that … they’re great companies, they’re great organizations, but for whatever the reason, it’s hard for certain consultants to grow and prosper in that environment.

It is not the same $100 million or $150-$250 million company that they were working in before, where it’s a little bit more family-oriented, less bureaucratic. There’s not this big umbrella of policies, procedures, and regimentation that lays over the top of it. They’re accustomed to having a little bit more of a free-form environment.

So these big organizations bottom and the next thing you know, it doesn’t work for a few very talented people. They spin off and go and start it over, as you see in the market today.

I don’t know how many new starts are out there today. We’re one of them. There’s a lot of people that go at it from different angles, but there are a lot of companies under $30 million today that are forming again. They’ll go through their cycle where next year, a few of them will consolidate. The year after, a few more consolidate, and then maybe they’ll get bought by the bigger guys again, whoever is there at that time.

You do business consulting for healthcare IT vendors. What kinds of trends are you seeing there?

We do business consulting on two fronts. We serve the supply side of the market and for the most part, it’s 99% healthcare. And when I say the supply side, I’m talking about those organizations that sell solutions or services to healthcare providers or payers. They come in the form of software companies, IT outsourcing companies, business process outsourcing companies, and even various forms of consulting companies.

There’s all different types of consulting companies. They all have a different set of needs than the provider side, so our strategy is a two-legged strategy. The first leg is selling to the supply side of the equation. I’ll talk about what we do there. The second leg is selling primarily to the provider side, the hospitals and health systems, and I’ll cover that in just a second.

But on the supply side, what their needs are: they are businesses that are trying to grow in their own discipline. They’re attempting to serve a client base. They have all the needs that a business has, in that they have to have a good business strategy, good marketing strategy, a good positioning strategy. They need an operating model that is efficient and effective. What we do for those organizations is help them improve their shareholder value or the overall value that they bring to, if it’s a not-for-profit, whoever the organization is that they’re serving.

We do business strategy, marketing strategy, operations analysis, and improvement work. We usually start out with various forms of assessments, whether it’s a business assessment or a functional assessment. We’ve done a number of those over the last couple of years for this. In fact, probably 50% of my client base today are suppliers to healthcare provider or payer sector. Our job is to help them become more effective and efficient in how they go at their particular market or niche.

On the provider side, for the most part, we concentrate on IT. As I said, we’re an advisory and management services company;  we’re not a staff augmentation business. We’re pretty high level in the IT organization. We do not have any barriers around size of organization, so we serve, I’ll say, not-for-profit organizations, $100 million not-for-profit hospitals to $2.5-billion large academic medical centers. We do everything from IT assessments, IT strategy, IT operations improvement work. We will take on the responsibility for running various functions within IT. We will also do, when I say take on the responsibility, also for projects. Everything from doing full selections or contract negotiation to overseeing the implementation of the solution we selected.

I have readers who run small startups. What needs do those small companies have and what mistakes do they make?

It’s rather interesting. There are a lot of software companies servicing the healthcare market today that are less than $10 million in revenue. They usually come out in the market with a solution. They’ve got a technology-based solution. They’ve got a couple of engineers that figured out how to build something that they’re taking to the market. There’s usually a need for it and they line up several customers. They start getting some traction, but they’re doing it in such a way that it’s kind of a shoestring approach to starting a business. They’re not necessarily capitalized very well.

So they got going, they’ve got traction, and they did it not necessarily in the most optimum manner. Now it’s how do I take the solution set that I have today and really blow it out? If it has national market opportunity and maybe they’ve got a couple million dollars worth of business, they have five clients, and you take a look at that. You do an assessment of their business and you find out that wow, these folks have built a great solution. But what they lack is how to take that solution in a grand way and really get exponential growth, how to take them from $2 million to $15 million in an 18-month period.

What we help them do is think through their business strategy, their marketing strategy. The marketing strategy includes how they effectively position themselves in the market, how they go after competition effectively, what’s the proper pricing strategy for their solution set. What’s the best way to increase the awareness and consideration of the buying population out there so that they get a fair hit rate and get that accelerated growth curve going?

That’s what we do and that’s one of the biggest problems that I think are confronting these smaller companies. We help them think through that and we will actually develop the tactical plans necessary to take them from their current state to that future state. They want us to oversee it in either a mentoring role or take on the responsibility as a senior executive of their organization to see it through. We’ve done that numerous times and we’ll do it again.

You’ve seen a lot of people and a lot of companies in the industry. What companies and people in healthcare IT do you admire?

I have been in this industry a long time, since 1969. I worked for and spent a good number of years at Geisinger Medical Center and spent 14 years of my formative years at Geisinger. I have a tremendous amount of respect for that organization. I like their model. They’re modeled after Mayo, but they’ve kind of went beyond that and they have their own model today. There are some people there, I’m not going to name them all, but there’s some people I’ve learned an awful lot from and a few of them are still there. I really have a great deal of respect for that organization.

When I did a long span, a 14-year span at CSC, Van Honeycutt, who was my boss for quite a few years , ended up being the CEO and chairman of the board there. I just learned a tremendous amount about how to run a business there and run it through thick and thin and have always been successful at running businesses in good and bad times. I attribute that an awful lot to not just Van, but a number of other executives that I had the opportunity to work with at Computer Sciences Corporation.

Rich Helppie and myself worked real closely together at Superior. I think we learned a lot from each other and we learned how to basically take that business and get it turned around and repositioned and take it forward. Whether it’s Rich or a couple of the partners that I work with today, I have a tremendous amount of respect for, and that’s why they’re my partners today. They are what made Superior successful as we came out of the turn there and began building not only a consulting business, but a really nice IT outsourcing and recurring revenue stream that we later sold to ACS. I can go on and name a hundred people, but I always learn from the people around me and hopefully they learn a little bit from me.

Any final thoughts?

My goodness, I just want to say thanks for the opportunity to have this interview today. I greatly, greatly appreciate that.

I just really and truly enjoy serving the healthcare sector. I’ve been in it all my life and I just thought it would be a lot of fun cranking an organization up on our own. We have four very good partners. I should probably take myself out of that category. I have three terrific partners, and we all have been there, done that kind of people. We’ve all run various businesses or parts of businesses and we’re very good at what we do and we’re all just having a ball doing this.

HIStalk Interviews Stephen Hau

Stephen Hau is President and CEO of Shareable Ink.

Everyone on your management team comes from PatientKeeper, a company that created a niche in the mobile healthcare technology. What’s similar and not similar with Shareable Ink?

That’s a great question. Shareable Ink is a very different company than PatientKeeper. When you take a look at the management team, as you pointed out, there are a lot of people who crossed paths at PatientKeeper. That’s because I spent twelve years at PatientKeeper.

As you know, I started the company and just left that six months ago. As I looked to start another company, I went out and thought of the people that I worked with in the past that would be good in a launching a new venture. Of course, I went to a lot of people that I crossed paths with at PatientKeeper.

What’s similar and not similar between the two companies and products?

I would say Shareable Ink represents a very different approach to healthcare IT. Shareable Ink is also a software company, but we combine digital pen and paper technology and some sophisticated enterprise software, form automation capabilities, and actually, a huge dose of pragmatism to deliver a very meaningful solution in healthcare.

As I look at the marketplace, I think the reality is that more than 80% of healthcare is still driven by paper. Shareable Ink makes existing paper-based processes like documentation, orders, and billing electronic with no change to workflows or individual routines. In fact, with Shareable Ink, no software is installed on-site, so we’re not “another IT project.” Actually, no training is required and we receive almost no support calls.

The result is that we’ve demonstrated 100% physician adoption and the entire organization realizes the benefits of electronic information. This is a different approach and it’s something to get really excited about.

Think about this: every year at HIMSS, what you see is vendors put up signage proclaiming that their products will reduce costs and generate phenomenal ROIs, improve outcomes and more. I believe that. But I kind of feel like there’s fine print or at least an asterisk that says, “All these benefits are only possible if doctors actually use the software.”

The industry’s dirty little secret is that physician adoption of IT is abysmal. And surely there are a lot of bad software products out there and doctors refuse to use them, but there are also a lot of robust, well-designed software products out there. Sadly, generally, they’re not well adopted.

We considered all of this when we started this new company, Shareable Ink. It’s my opinion that the issue is really not that of technology, it’s actually really about psychology. I think there are a lot of well-intentioned software designers out there that are tackling some of healthcare’s big challenges, and that’s great. The problem is that historically, they ask the doctors to completely change their workflow. And as I said, we took a very different approach. We’ve created a platform that produces electronic information without changing physician’s routines at all.

So much of the benefit of moving from paper to computers is to avoid illegible handwriting and to get information in discrete form rather than as a picture. Isn’t digitizing handwriting a step backwards?

I don’t think so. I think we’re taking a very pragmatic approach here. I can give you an example of our first large customer, which is an outsourced anesthesia billing company located in Michigan. They’ve got over 8,000 anesthesiologists under contract. Before Shareable Ink, these anesthesiologists would record their cases on paper anesthesia records. Some of the anesthesiologists would wait until the end of the month to FedEx these records to the billing service, where the envelope would be opened and the anesthesia records would come out. A human being, a biller or a data entry person, would actually key-enter all that information.

Other anesthesiologists would deliver the anesthesia records to someone in the back office that would essentially put the anesthesia record in a queue to keyed in. When the records finally reached the folks in Michigan or over to their overseas FTEs, often it would be too late to update incomplete forms or incorrect records because basically you have to chase down the anesthesiologist and say, “Hey, remember that case you did three weeks ago? Well, when was the anesthesia end time?”

With our system, the record is made available to the back office, literally, a few seconds after you complete the record. The paper form looks exactly like the forms the doctors used before we introduced our system. There’s literally no training whatsoever. But now, the records are processed immediately by the back office because information is available on our secure Web site — our Web portal — and the doctors are notified of any sort of errors they made in the anesthesia record within seconds after the form completion.

We did a study at a surgery center in Delaware. We were able to show they were able to improve form completion rates from 78% to 99%. Is this a step backwards? I would say no. I mean, what we were able to do, we were able to reduce a tremendous amount of re-work. We were able to, for this particular example, shorten AR days and vastly, vastly improve physician satisfaction.

What’s the benefit of offering a handwriting application as a software as a service instead of running it on a consumer-grade Windows application like Microsoft and others offer?

In my personal opinion, software as a service is hugely applicable to healthcare IT, so there are a few notable benefits. First of all, because we don’t have to install any software on-site, we’re not another healthcare IT project. This allows us to move very, very quickly. That’s definitely because our technology is off-site. We’re able to bring a lot of fire power, a lot of computationally-intensive functions to our technology.

As an example, rules and alerts, as I mentioned before, physicians, when they fill out a form and it lacks a key piece of information, perhaps related to some sort of PQRI initiative, we can send them an SMS message to their pager and e-mail, what have you, instantaneously, because all our capability is on the Internet.

Also, it makes it very easy for us to automate forms. One of the challenges out there, or course, is there’s a lot of paper. That’s both the opportunity and the challenge. Part of our philosophy here is that we don’t want to change anything a physician does, so we make it very easy to customize or utilize numerous different types of existing forms that an organization normally might have.

Separately, we provide the ability for so-called ‘third-party validators.’ I can give you a few examples. We talked about the outsourced anesthesia billing company, where they’ve got billers and clinical folks both here, stateside in the United States as well as overseas in India, in that example. The fact that anyone on the planet can help get involved in processing the data is a huge benefit to our customers because it allows them to keep costs low and also to operate on a 24×7 basis.

We are working with a very prestigious cancer center and they are doing drug orders using our system. The interesting background there is that those physicians, about a year ago, tried to bring in an electronic system to handle the orders of their oncology drugs. It’s a great idea, but in practice, it was such a change in workflow that the physician productivity just plummeted. It turned out that in practice, it just wasn’t a system that worked well for them.

What we’re doing with them now is we’re essentially taking the paper ordering forms that they’re using today and we’re making them electronic. The physician, essentially, does nothing different. They’re still ordering drugs through their existing processes, but because of the ability to support a third-party validator, the person in the pharmacy department is now validates the data and then takes the next step, which is to electronically submit the physician’s information into the electronic ordering system where all the rules fire and all the good things about having electronic information occur. These are some of the benefits of being able to have a software as a service model.

How does Shareable Ink work with existing applications like an EMR?

We have, behind the scenes, a tremendous amount of integration capability. Some of our customers can actually start before using the integration capability because at the end of the day, we know that by automating paper-based processes, we can co-exist with existing processes. There are other customers where it makes sense to have the integration capability in place before getting started.

I can give you some examples where, in fact, we are working with EMR companies to provide their customers a paper-based modality to get information into their EMR. I think when you sit across the table from a CEO of an EMR company, he or she will tell you that of course there’s a huge value proposition for going electronic.

But the challenge is still trying to get physicians to put fingers on keyboards. There’s a longstanding paradox in healthcare, which is — institutions want digital data, but physicians, who are the highest-paid workers in the organization, don’t want to compromise their productivity by having to key-enter data into computer systems. What we’re offering customers on a direct basis, as well as with some EMR channel partners, is essentially the ability to bridge existing processes into electronic EMRs or EHRs.

Physicians who don’t want to type often look at speech recognition instead of a keyboard. Where does Shareable Ink fit then?

I think transcription is an interesting analogy. In some ways, there are physicians who have migrated to transcription. Dictation transcription’s a way of getting electronic data into back-end systems. Obviously, there are a lot of physicians who resist that, who essentially feel, “We’ll document on paper.” What we offer has both differences and similarities.

In terms of differences, because we’re utilizing often templated, form-based data entry, we have the ability of creating a better kind of structured information. Because, for example, we know that if a physician is entering, for example, allergies — in this particular area — our system is smart enough to say, OK, these are allergies. The system will now choose words from a more specific lexicon knowing that it’s going to be plugged in. Or perhaps drug names. Not only that, after we process the information, we’re able to then, in a structured basis, interface the electronic system saying that this is a list of allergies, or this is a list of drug names.

Some of the similarities … if you take a look at how the dictation/transcription business has evolved over the last few years, I think what we’ve observed is that that particular segment has brought more and more sophisticated computer-aided technologies to support or help the transcription process. eScription’s a great example, where they take the audio from the physician and then take advantage of voice-to-data technology to take advantage of sometimes semantic reasoning to improve the transcription process. I think the analogy is that we’re taking advantage of some very cool, cutting-edge technologies to assist us in the handwriting to electronic data conversion.

We also have the ability to take advantage of something called the Mechanical Turk approach. That’s a community model that allows us to essentially co-mingle computer-based computation with human beings. Not only that, we’re able to break down the problem by using multiple human beings to essentially support the handwriting-to-text conversion process.

One thing I forgot to mention about the SaaS model: one of the key benefits that we allow our customers is getting started with our software with very little cost to them up front. We charge for our product on a subscription basis, so this allows many customers to get started very quickly without any sort of up front capital purchase. That’s a key advantage of SaaS models, obviously.

So you’re selling a new concept as well as a new product. How do you get the message out?

Well, I hope this interview helps. [laughs)

It’s all about HIStalk.

Yes. Well, it’s interesting, because it’s a new concept and at the same time, it isn’t. I guess in some ways the new concept is: wouldn’t it be great to get all of this electronic information and actually realize all these value propositions that you’ve been hearing for quite some time without changing physician behavior? In that sense, it’s certainly a new concept. But at the same time, I think we’re addressing a lot of known healthcare issues and I think the timing couldn’t be better.

Look at the ARRA legislation. Look at the demands of organizations to go electronic. But at the same time, realize that they need to have a pragmatic approach that’s cost-effective, that they know the physicians will actually adopt and use. I think it’s a great time for the Shareable Ink idea, especially in this time with the government pressure to meaningfully use these EHRs. Well, clearly, I think our approach falls under that category.

What’s your elevator speech when you’re talking to the hospital CIO or CMIO or head of an anesthesia billing company?

I think the message is different. In some ways, we have a high-class problem here. I mean, reality is, as I said before, 80% of healthcare is written on paper. The high-class problem is that there are many, many different applications that we can provide. With some of the customers we’re working with, we are doing physician documentation projects. We are doing nursing documentation.

I mentioned that we’re doing orders and obviously, we’re doing these anesthesia records. There are many different applications. I think in some ways, the pitch is, often we share our capabilities as a seamless way to create electronic information with no change in workflow and with a very, very kind of easy way for an organization to get started. You start with that reality or if you start with that capability, and very quickly what happens is that the CEO of the organization says, “Oh gosh, you know, I’ve got a problem that you could solve with your approach.” This is something we can actually address and realize some success.

So the message is really one of, I think, very, very innovative technology. A lot of fire power that happens behind the scenes, but coupled with a very pragmatic approach to realize those benefits, there has to be virtually no change in workflow. It has to be something that addresses both not just the technology, but the psychology of the organization.

An HIT Moment with … Greg Smith

An HIT Moment with ... is a quick interview with someone we find interesting. Greg Smith is a Certified Product Safety Project Engineer (NCE) and quality assurance manager for the MET SE Headquarters.

Your article, Not Suitable for Medical Use, suggests that special interests pressured OSHA to allow medical devices with unproven electrical safety to be used in the OR. How did that happen?

There are a combination of reasons that contribute to this, but the main reason is a perception that having this equipment correctly built and tested to national and international safety standards is too expensive. In reality, having a compliant product certified can cost as little as $5,000-$10,000, then between $2,000-$4,000 a year for testing laboratory audits to make sure the manufacturer is still building the units per the certification report and performing electrical safety testing before the equipment leaves the factory.

This cost, when adjusted to the hundreds and thousands of, for example, computers, is not a significant cost factor. The fact is, sometimes it costs more that this because these manufacturers are turning out non-compliant and hazardous equipment. We see this every day in the testing lab and during the unannounced factory inspections during the year. Our records show that if manufacturers were allowed to "get it right" on their own, they will, in most cases, not get it right. Most manufacturers making a product for the first time do not even know what standards apply to their products.

These special interest groups are pressuring OSHA, along with elected officials who know nothing about electrical safety. At the same time, electrical safety experts are constantly reminding OSHA about the reasons why this is a Federal requirement for equipment in the workplace.

There are no US regulations for imported products to be safety certified. Although the "CE" mark is legal in Europe, the EU is considering moving to a new system because they are being flooded with these "CE" self-declared products from Asia and other places. Why would we move to something like the SDoC (Supplier Declaration of Conformity) when this system is showing problems over time in other parts of the world?

Simply put, these groups want to speed up time-to-market at any expense. In this case, it is at the expense of safety for US consumers and workplace owners. Here is a great article on SDoC.

What are some real-life examples in uncertified medical devices cause harm to patients?

Just last year, a baby was burned at a NC hospital by a non-certified incubator. Some of these incidents really stick out, especially whey they make the news. Many incidents of shock are never reported, are only sometimes recorded in the OSHA logs, and not ever reported unless OSHA has a reason to examine these logs. Also, some incidents are prevented through the diligence of our biomedical technicians, who regularly test and repair equipment.

In recent years, incidents have decreased because many hospitals require medical equipment to be certified as a condition of purchase. At some less-vigilant healthcare facilities, patients are likely killed from leakage current, although this is difficult to prove because it is simply called "death from cardiac arrest". The science of electricity and specifically leakage current tells us of the hidden dangers, especially to patients who are vulnerable (e.g. during surgery). The National and International safety standards for medical equipment are in place because of these known hazards.

A skeptic might say that you have a vested interest in raising concerns about uncertified products since you’re in the certification business. What would you say to convince them your concerns are real?

Those of us who are passionate about safety spend many personal hours addressing these problems. Electrical safety experts include electrical contractors, electrical and other government inspectors, power company engineers, design engineers, and electrical equipment manufacturers. For an unbiased view of these issues, ask some of these individuals.

For example, these issues are discussed regularly in associations like the IAEI, the International Association of Electrical Inspectors, where all types of electrical safety experts help develop consensus positions on these subjects. Go to the IAEI Web site and read some articles on product safety and the need for third party safety certifications, . 

An important question here is: if we don’t ask our electrical safety experts, who are we going to ask? Would you consult a mechanic about an internal organ surgery? In a recent NC court case to exempt equipment from safety inspections, the "Code expert" for the plaintiff was a man who developed a way to get cat urine out of carpet. The electrical safety experts were ignored because science and facts are less exciting than rhetoric and hyperbole. Vested interest? There are many types. Some are based on science and a desire to keep others safe and others are based on haste and pure greed. We are in the business of product safety certifications because electricity kills people. 

IT departments are often involved with choosing portable computing equipment that includes batteries and electrical connections. What should they be doing to make sure these devices are safe for use in specific hospital areas?

Purchasing departments should specify that only certified products are to be procured. There are many valid safety certification marks and agencies ("CE" is not a safety certification). In these specifications, it should be mandated that patient area equipment needs to carry a UL60601 designation.

Regular (consumer) computer equipment is designed much differently, and even if it is certified, the standards are much different. The IT Standard, UL60950, allows leakage current levels five times as high as the medicals standard, and for good reasons.

Also, consumer IT equipment is not designed for the medical environment, as with laboratory equipment and consumer TVs and appliances. There are computers and monitors specifically designed and tested for patient area use. Typically, IT departments and administrators do not know the difference. Many facilities use isolation transformers in an attempt  to mitigate risk, but the equipment can be easily unplugged and leave patients and healthcare workers exposed to the risk of electric fire and shock or electrocution.

Should hospitals and practices regularly test computer equipment for safety when it is used in patient care areas?

All equipment for patient care areas should be tested on a regular basis. This equipment undergoes heavy usage and is prone to failure through wear, abuse, and environment. If the protective ground is lost, the risk increases, especially for equipment not designed for use in patient areas.

Biomedical technicians regularly see these conditions, providing safety testing and effecting repairs. These electrical safety specialists are on the front lines of patient and worker safety, and should be allowed to do their important jobs. There are regular attempts to cut this testing from budgets, so much attention needs to be paid to this profession and the unseen hazards they prevent.

HIStalk Interviews Paul Meyer

Paul Meyer is co-founder, chairman, and president of Voxiva.

Tell me about Voxiva.

We’re a mobile technology company that had a crazy idea nine years ago that mobile phones had something to do with health. We’ve spent the last nine years building a platform and building mobile health solutions around the world.

It seems that the premise of the company is that expensive computers and ubiquitous broadband connectivity aren’t really necessary to connect the public to health services and to health experts. Is that true? And is it true in the U.S. as well as in the developing nations that you’ve worked with?

Absolutely. In the developing countries where we started working, the Internet just wasn’t a reality at all. Cell phones were the only game in town. Everyone was thinking about how you extend certain information systems to most of the world’s people. The cell phone is the only tool you’ve got at your disposal.

But over the last couple of years as we’ve started doing work here in the U.S., we’ve realized the same thing is true here. Statistics are pretty amazing. There’s some great data from Pew on relative reach of the Internet versus cell phones. It’s still a pretty striking gap. 

There are a lot of populations, particularly underserved and low-income populations, that still don’t have very good access to the Internet. Yet 90% of people here have cell phones. And, it’s not just that they have cell phones — their cell phones are with them in their pockets and on their bed stands.

If you think about how can technology be leveraged to help drive behavior change and improve patient adherence and compliance, you may as well use the technology tool that’s in their pocket.

Do you think the iPhone got people thinking about the possibility of having a smart phone deliver a fairly rich application?

I think iPhones have done an amazing job of opening people’s eyes up to the possibility. People ask me a lot why the U.S. is thought of as so far behind the rest of the world in terms of mobile health. There are a couple reasons. 

In the rest of the world, in emerging market countries, there was no alternative. There was no Internet to reach those people. Necessity being the mother of invention, people went right to mobile.

Secondly, the U.S. is the only country in the world where you actually pay to receive text messaging on cell phones. That’s also been a barrier to the adoption. Not just to health applications, but mobile applications in general. But I think that’s starting to change. Certainly the iPhone has done a lot to open people’s eyes to the possibility that cell phones could be used in powerful ways to make you healthy.

Now, with that said, when I ask someone what their mobile health strategy is and they say, “We’ll build an iPhone app,” My response is always, “Well, what are you doing for the other 95% of the people?” I think you would do well with an iPhone, but ultimately, if you want to try to reach a big chunk of the population, you need to use other tools — whether it’s SMS or voice response or other ways of using a mobile phone — and not assuming that everyone’s going to have the iPhone, because they don’t.

I think people who travel outside the U.S. are sometimes surprised by that we’re fairly primitive in our cell phone technology. Do you think that’s a barrier, or is it going to improve?

I think it’s getting better. I talked about a couple of the reasons, but in some ways the real reason that the U.S. is behind on mobile is because we have the Web. If you think about all of the innovation that went into the dot-com era, all these Web-based business models, many of our best and brightest minds spent ten or fifteen years innovating on tools to use the Web.

In the rest of the world, where the Web was not a reality, that kind of innovation and creativity went into optimizing mobile devices. That’s why, in some ways, the rest of the world is so far ahead.

After nine years of doing this in places from Peru to India to Rwanda to about 14 countries where we operate, when I’m now spending a lot of time here in the U.S. working with our clients here, my not-so-subtle message is, we’re here to help you learn from what they’ve done in Mexico, what they’ve done in India or Rwanda  in terms of leveraging mobile technology to improve healthcare.

That makes me think of India’s technical advances in the 1990s when they couldn’t afford mainframe computers and therefore created a generation of PC and Web developers that drove the industry. Could the same thing happen with cell phone development?

I think it has. I think you’re seeing that. I think that’s exactly what’s happened.

I think obviously the U.S. is waking up to this. Secretary Sebelius last week gave a great speech. There was a mobile health summit hosted by the National Institutes of Health in Washington. Secretary Sebelius gave an incredible speech talking about the importance of mobile phones in healthcare. It was really refreshing to hear.

I would say there’s so much discussion and focus right now on electronic health records, my fear is, as the government is gearing up to spend all this money on all these high-tech incentives for EHR adoption, is that we’re spending way too much time talking about the plumbing and not enough time talking about how all this technology is actually going to make people healthier.

One of the things I was really gratified to hear in her speech last week was that the importance she attaches to mobile phones as a tool for really informing and engaging your power in patients, seeing the mobile phone as the obvious extender of electronic health records. I don’t want to diminish the power of Web-based EHRs and other tools that are out there, but I think they’re getting a fair bit of attention.

I think that people aren’t paying enough attention to the fact that we already have, in the U.S., 300 million cell phones. In my view, those are 300 million untapped health behavior change devices that are ready to be put to work.

Did you get a sense that the government really understands the difference between just making providers theoretically more efficient as opposed to actually changing health?

I think certainly some people do. I think we’re working with the government on a really exciting initiative that isn’t announced yet. Secretary Sebelius alluded to it in her speech last week. It’s a major mobile health service focused on pregnancy and providing information by text messaging to pregnant women and new mothers to help make a dent in the pretty horrifying maternal and infant mortality statistics in the U.S. We’re working with the mobile phone industry through the CTIA, Johnson & Johnson, and a bunch of federal partners. 

I think the HHS and the federal government partners that we’re working with really see this initiative as a very high-profile demonstration of the power of mobile phones to really improve health and impact one of the biggest health crises facing the country.

There are certainly some real believers in the government in mobile health. My advice to them has been, as the government is spending all these billions of dollars on health IT, they want to be sure that they actually do some things that are actually visible and tangible and beneficial to patients. 

The government is run by politicians who ultimately want to appeal to voters. You don’t want to be the politician that explains how you spent 20 or 40 or whatever billion dollars on improving the technology to improve health care, and yet have none of it visible or beneficial to patients in a way that they can perceive.

I think it’s really important to identify ways — and again, obviously you know my bias — but I really believe that mobile health is probably the best way of extending some of the value of health IT to patients to help support them, engage them, inform them, and help them live healthier lives.

We send much of our public health expertise out of the country since we already have clean water and vaccines, but our healthcare system is still centered around the idea of episodic treatment interventions. Are population-based public health interventions a tough sell here?

We have huge problems here. The United States has the second-worst infant mortality rate in all of the developed world. It’s staggering. It’s unconscionable that we’re about the richest country in the world and have infant mortality rates at such staggering proportions.

We’ve looked a lot at the data and it’s pretty concentrated. The high infant mortality rates are highly correlated to lower-income women, primarily African-American. The Hispanics actually have relatively better birth outcomes. So African-American, lower-income, low educational level, highly concentrated in the South. That’s the part of the country that has the worst birth outcomes.

We then took some of the Pew Research data and looked at the Internet vs. cell phone penetration among the sub-populations with the highest infant mortality. There was just a 20-30% gap between broadband Internet and cell phone penetration in the population that we’re trying to reach.

African-Americans and Hispanics are disproportionately much higher users of SMS and other mobile data services because they have a relatively lower level of internet access. If one is looking at how to extend and improve health services and extend healthcare to under-served and low-income populations, the mobile phone is an even more indispensable tool.

We’re doing a lot of work with people focused on serving the Medicaid population, but as healthcare reform is happening and all of a sudden the country is figuring out — how are we going to actually start extending healthcare to 30 or 40 million people that don’t have it right now?

These tools are really important for a couple of reasons. The lower-income people that don’t have access to healthcare right now are disproportionately high users of cell phones. But secondly, the idea of actually automating some of this interaction and giving people the information and the tools to take care of themselves is a way of actually reducing the burden on the healthcare delivery system.

We already have an over-extended healthcare system. With 30 or 40 million more people coming into it finally at long last, it’s going to be even more of a burden. We’re looking at some of these alternative ways of engaging patients. I think it’s going to be more important.

Do you think it’s counter-intuitive for the average person to understand that poor and less educated people are heavier users of cell phone technology?

I think that people are often surprised when I show them that data. I think people assume that technology usage and income are just correlated on a straight line basis. That just doesn’t actually get borne out when it comes to cell phone usage.

If you were trying to make the case that this technology works for health improvement, what examples would you give?

There have been a lot of really good published data. I was looking at a study just today from Norway on smoking cessation. In a randomized clinical trial looking at people that were involved in a smoking cessation program, half of the study group was also enrolled in an SMS texting support service to enhance the program. It doubled the rate of quitting.

We’ve done a lot of work in improving adherence and compliance in HIV/AIDS care treatment. There have been some really, some good studies showing improved efficacy of weight loss programs when enhanced by a mobile service. It’s still early, but I think there are some good initial studies showing the improved health outcomes in these kinds of interventions.

I think this approach works for everybody, but I think particularly if you start looking at thinking about serving low-income and under-served populations and how to leverage technology and engage with them about their health, the Internet can’t be the end of the story.

There’s another data point from Pew of people with chronic conditions. Only 50% of them have Internet access. If you can get 100% adoption of some Web-based tool, then you’re still only halfway there.

Anyone who is looking at how to engage and support people in their health, particularly but not exclusively in some more under-served populations — I just think people would have to explain why they wouldn’t take this kind of an approach.

Your background in political and humanitarian causes, along with the source of funding for the company’s projects, almost make it sound more like a non-profit public health think tank than a for-profit vendor. How is Voxiva like and unlike the traditional software vendor?

I grant you that I personally and Voxiva have had a somewhat circuitous past to the U.S. healthcare system. We basically just saw big problems to solve. We saw a big opportunity to leverage to solve those problems. We may think a little bit differently than traditional public company, but ultimately, we’re driven by trying to solve problems. Like helping developing world health systems track disease outbreak better or that and things we’re focusing on now, of trying to help give people the information and support to live healthier lives.

We focus on trying to leverage and define innovative solutions for solving important problems. We believe if we can do that, we’ll get paid for it and make money at it. Henry Ford had a pretty good line on this — a company whose only purpose is making money or has no reason for being.

Finding problems to solve and eventually figuring out how you’re going to get paid by people for having and creating value has, I guess, certainly been our philosophy in terms of building a business.

Who’s your customer?

We market to public health and government health. We’ve also got those public health agencies and government healthcare providers. We market it to insurance companies. We’re working with one of the insurance companies. We market to pharmaceutical companies that are paying us to create adherence programs, and also the big employers. We’re beginning a little bit of work with some provider networks.

You were quoted as saying that Voxiva’s ideal employee is part McKinsey consultant, part Microsoft engineer, part Peace Corps volunteer. What are the employees and work environment like?

I said that probably six or seven years ago when it was relevant toward developing world business. We do blend a lot of skill sets. We’ve obviously got a lot of engineers. We’ve got a lot of health people.

We were started by — I guess I don’t know what you’d call me, an entrepreneur — a technologist, and a medical anthropologist. I think the three founders roughly had the very skill sets that we have tried to combine. What makes what we do interesting and also makes it hard is that we really do try to live at this intersection between technology and health and behavior change and sociology.

We’re not your people that write code. We work with our partners and our customers to come up with solutions that are really going to make people healthier. It’s not just a matter of taking, for example, content of a smoking cessation program or pregnancy educational materials and squeezing them into the 160 characters you can fit into a text message. It’s really about developing interactive engagement services that can improve health and change behavior.

I don’t think we have anyone that actually perfectly embodies all of the skill sets we need, but we definitely have tried to attract people that check more than one box and blend some of the various skills from the overlapping the Venn diagram of what Voxiva is.

Any final thoughts?

There are 300 million cell phones in this country that are sitting idle. We use them to vote for American Idol. That’s really what we’re using them for here, other than sending text messages and making phone calls. I think the healthcare system in this country can put them to work and do a lot more. I think people ought to be thinking about how. We’d love to help.

HIStalk Interviews Parker Hinshaw

Parker Hinshaw is CEO and co-founder of maxIT Healthcare.

 

What made you move from the provider side to running companies?

I’m a service-oriented kind of a thinker. It always felt like one of my strengths was surrounding myself with really talented people because I need people around me that could make me look good, I suppose. It was successful for me working in hospitals.

It seemed like there was just a real need for that out in the marketplace. The software vendors always struggle with how they keep their costs down. They end up hiring a lot of young people who take awhile to really be productive. Also, generally speaking, they don’t have a real hospital experience, so they’re learning on the job. And they’re overpriced.

So when I looked at it, it seemed like there was just a real opportunity to do two things. One was to create opportunities for people who ran up against the ceiling at a hospital, as a really good technical person or functional application person. You can get bored at some point in time if you’re really somebody who needs to be learning new things all the time. In a hospital, you’re going to run out of new things to do.

It’s just interesting that you can hire folks that are underpaid at a hospital, pay them better, and still have a really positive, wholesome, healthy culture that you get at a hospital. Most people that work in healthcare are all about taking care of the patient in the end. That’s what drives us all, and the opportunity to do that even on a larger scale.

It’s those two things, I guess, and just a desire to create a company culture that’s very, very positive, because I’ve worked in many that weren’t. [laughs] It just seemed like if you were spending that much time working for someone, it ought to be a good thing. If you were going to spend that much time going to work, you should feeling good about going to work.

So I left the provider side and went to the software companies. That was bizarre. They were just so political, so aggressive in their treatment of people, so callous. It just didn’t work for me at all. I had to find something in between the two, I guess, in the end. This seemed to be a good thing.

Where were you working?

I spent time working for Compucare in the early 80s when they were going from an outsourcing firm — which is what I thought I was doing — (laughs) to becoming a software company. That was during the Baxter years. Baxter had acquired five good companies and messed them all up, in my opinion. [laughs]

Are you gearing up for new business because of ARRA?

Yes. To me, it’s just the next wave. I’ve been around a long time now. When you do something for 35 years, you start to see the patterns. If it hadn’t been this, it would have been something else, is my view of it.

This one seems like a really good one, though. I think this one is very exciting, because those of us who’ve been around a while always figured something had to change in a major scale, because we’ve been doing everything the same way, in reality, from the beginning of IT in healthcare.

I think it’s time. I don’t know how it’s going to shake out. I don’t think anybody does. But something had to change, and I don’t think they’re doing this because there’s not a problem. I’m very excited about it.

We’re also starting to get involved in the payer space primarily for those reasons, because something’s got to change. It seemed like a good opportunity in several different areas. It’s not just the hospitals and the ambulatory centers. It seems like a great opportunity to me.

So what type of things are you looking to do in the payer space?

It’s really very similar. It’s got an IT bent to it. It’s really all about the systems, change. You really look at what ours are about; it’s all about facilitating change. So most of the time IT is in the depths of all of that.

We fundamentally track the customer base of the software vendors because of what we were talking about before. The software vendors, because of the way they are reimbursed with delivery points ultimately, there is a parting of ways in the goals and objectives of the customer versus the goals and objectives of the software firm. That’s where firms like ours come in and fill that void, because they need to go on to closing their next deal and make sure the people keep their pipeline full.

Then they turn it over to the service organization of the software company. Then you’ve got all those dynamics that we were talking about before, the politics of the organization, those things, the churn that goes on with people trying to cover more than they could possibly handle. Those are the profit requirements of a for-profit company.

How does a consulting firm add value other than simply marking up the hourly rate of its consultants?

I think the way that we add value is that the IT side of the work that we do is almost secondary. What we really have is clinicians and financial folks first who happen to be really good with IT. I think the way that we really make a difference is — and hopefully, what we’re doing is hiring the cream of the crop, right? I mean, if we hire those people that hit the ceiling in a hospital because they’re better and they need more work, that kind of thing, then hopefully we’re better than the folks that are traditionally happy and satisfied staying at a hospital level.

So it’s really all about knowledge transfer. I talk to my folks all the time. “Your job, really, is to work yourself out of the job in every engagement that we do.” It’s all about knowledge transfer, right? If you do that really well, then that hospital that you’re working for is going to give you another job to work yourself out of.

So perpetual knowledge transfer is really what this is all about. Elevating the skill sets of the people in the hospital that use those products and understanding it.

People get satisfied doing the same job over and over and over again. Some people do. When they have to change and do something different, it takes a special person, I think, to help them understand that they can still get to that comfort zone that they’re used to. But it’s got to change. You have to move forward. Those people that like the process of change need to help those that don’t. I think that’s where we fit.

You’ve got eyes and ears all over the hospital IT business. What are the most interesting and innovative things being done out there right now?

I think there’s an awful lot of exciting things happening in cardiology, radiology. Lot of the clinical departments that we’re seeing a real need for that really aren’t the traditional spots that firms like ours work in. It’s usually about nursing or lab or pharmacy, all the traditional things that we spend most of our time on.

But right now, we’ve decided that what our role could be as a transitional thing and also to make work interesting for people, is to do departmental management consulting. I wouldn’t call it strategic in any way, but really it’s a lot about helping departments in a hospital do assessments, figure out how to better utilize the equipment that they have, improve on the work flows, all those kinds of things.

To me, it’s those kinds of areas where the technology is really improving, and we’re trying to figure out how to adapt to that and then tie it in to the traditional information system. It’s all related to the EMR; that’s where it’s all heading. Those areas that we may not even have thought about historically. “What’s going on in the OR?” “What’s going on in the ER?” and all those things.

Who do you admire in this industry?

Fundamentally, I’m an entrepreneurial guy, so I would say people that find an angle that’s different and new that really adds value, and they do it not because they want to make a bunch of money, but because they want to provide a service. The money will come as a result.

I admire people who have a real passion to do something that benefits us all, and in the end, they made it. Most entrepreneurial guys are still thinking about the dollars, but it should be secondary to providing a service that makes it valuable so you can make a dollar.

I’ll tell you one person that I really have learned to admire, and I find her to be really different — it’s Judy Faulkner. She has taken a stance that is kind of counter-culture to what the typical software vendors are about relative to customer service. She has happy customers. It’s very hard to find software companies in this industry that have happy customers.

I have admired Jim Reep, who founded First Consulting. I thought he created a really positive culture, and really fit that description that I mentioned earlier. When he went away, I think bad things happened in that company. [laughs] I guess I admire leaders fundamentally, people who see something, pursue it.

I also admire people who do it without somebody else’s money. The people who go to private equity firms and borrow — I’m a bootstrap thinker, I suppose. Those people who do it for the right reasons. That’s what happens if you’ve got a bunch of investors involved and you borrowed their money. Now, all the sudden, you’re more worried about keeping them happy than you are about your customer and taking care of your employees. So people who take that approach, I admire.

It’s always been exciting to me. I’ve always felt good about being in healthcare. I’ve felt very blessed to be somebody that was lucky enough to fall into the IT side of the industry that’s always doing the right things for the right reasons. Not always competently. [laughs] But it’s always an interesting place to be.

An HIT Moment with … Jonathan Phillips

An HIT Moment with ... is a quick interview with someone we find interesting. Jon Phillips is managing director of Healthcare Growth Partners, LLC of Chicago, IL.

What economic and market conditions have most affected vendors in the past year and how does the next 12 months look?

Fundamentally, vendors are indirect victims of the challenges facing their customers. Hospitals have seen access to capital disappear, operating results worsen (due to reductions in elective volumes and increases in Medicaid and self-pay/uninsured visits) and dramatic declines in investment income (which helps to fund operations).

Physicians are seeing operating pressures as well, not to mention the indirect impact of declines in value of real estate and other investments and the effect that has on their ability and willingness to spend. Insurers and suppliers remain profitable, but have become quite cautious as the healthcare reform debate works its way through Washington.

As a result of this pressure on customers, vendors are feeling significant stress related to their financial performance. The capital markets see it differently — HCIT valuations are at or near all-time highs as public investors assume that ARRA-related stimulus spending will drive billions in revenue to vendors in the space. At some point, the capital markets expectations will have to meet the reality of customer spending, or customer spending will have to dramatically accelerate to meet capital markets expectations.

The good news is that we are hearing customer purchasing trends are starting to look up, particularly on the physician side of things. However, given the fact that ARRA actually froze much of the market this year as purchasers have been waiting for clarity, our sense is that there is still a long way to go for vendors to feel that they can achieve strong sales growth.

Spending will likely improve across the board in 2010 with solutions demonstrating clear ROI leading the way. Physician sales of EMRs and related capabilities will continue to be strong as practices position for stimulus benefits. Hospital solutions, payer solutions, and supplier solutions are likely to see cautious growth next year as the implications of any healthcare reform package are weighed with regard to how the new environment will impact IT requirements.

We still see strong interest in “pay as you go” models, providing opportunities for providers to acquire systems capabilities while managing upfront capital outlays. While those types of models seem to be spurring sales, many vendors struggle when making the shift to that type of a model since, absent some type of third-party financing, the “pay as you go” model can wreak havoc on the balance sheet of a company used to selling perpetual licenses.

What will drive the M&A market this year?

The M&A market for the balance of this year and into next will be driven by two main trends. First, you will see an increase in the number of distressed transactions. We look at distressed transactions as ones in which the seller is effectively forced to consummate a transaction, generally due to liquidity (i.e. the company is running out of cash).

We expected the distressed market to pick up sooner than it has, but a number of factors have impacted that part of the M&A market. First, with the potential stimulus spending hanging out there, investors have been willing to continue to fund companies operating at a loss in hopes that revenues will pick up and profitability will be achieved in the near term. Unfortunately for many of those companies, revenue growth will recover, but too slowly for them to reach profitability in a reasonable period.

Second, many companies aggressively cut costs late last year and early this year to extend their financial runway. There is not a lot more “fat” for them to be able to take out of their businesses. The result of these two factors is that a number of companies will likely be at or near the end of their financial runway over the next six months. The closer a business gets to that point, the less leverage it will have in its sale negotiations. As a result, we expect distressed deal volume to pick up.

The second main trend relates to investor expectations versus reality. Because of all of the hype surrounding the stimulus spending on HCIT, healthcare IT stocks have rallied, in many cases to their all-time highs. However, if you look at the results being delivered to date (we’ll see if Q3 continues the trend), revenues have been soft, and earnings improvements have been driven by expense reductions. From our perspective, there is a gap between what the markets expect healthcare IT companies to deliver in revenue growth and what they can deliver organically in the short and mid term.

All of the stimulus talk has actually extended sales cycles, and even as the purchasing environment improves, it will take time for bookings to translate into revenue. Therefore, you will see public and larger private HCIT companies looking to acquisitions to augment their internal growth rates.

What companies need to be bought and which companies need to buy someone?

As we mention above, larger companies facing the reality of their sales efforts will need to buy revenue to augment their organic growth. These targets will most likely fall into two categories — share buys and technology buys. Share buys are situations where the acquirer cares little about the target’s capabilities. They are primarily interested in their customers and the opportunity to either up-sell or cross-sell those customers new solutions. Technology buys are intended to broaden an acquirer’s capabilities, using the acquirer’s distribution reach to push a strong product out to a broader customer base.

In terms of companies needing to be bought, if a business has less than six months’ cash on hand, they should be aggressively pursuing an exit, whatever products and solutions they offer. Often we see businesses waiting, hoping that they will be able to raise money or that the market will quickly improve. When those hopes fail, the outcome is generally far worse for employees, shareholders, and customers than it would have been if the business had elected to pursue an orderly exit process rather than an accelerated distressed sale.

If you were launching or buying a start-up, what niche would you go after?

We’d go after a “lowest common denominator” physician-focused EMR that qualifies for meaningful use and that is seamlessly integrated into a physician’s workflow. This type of a solution would likely be a hybrid offering, providing for electronic documentation and order entry but doing it in a way (perhaps with scanning or e-forms) that works with existing clinician workflow. The solution would be priced very aggressively on a subscription basis and would be offered as a Web-based service. We think that a simple offering like this would have the chance to revolutionize the market by being rapidly adopted by small physician groups.

What kinds of vendors will benefit most from stimulus money, both in the short and long term?

Depending on how meaningful use is defined, vendors most likely to benefit are those that help providers qualify for incentives at the lowest cost.  We also see incumbent HIT vendors in hospitals benefitting as they can help shape hospital spending to hit compliance levels.

The other group that is definitely seeing growth is the consulting side of the business- it seems that many organizations are looking to consultants to help them plan their approach to become meaningful users. Those consultants are likely to continue to benefit as organizations implement the solutions that they recommend. However, most vendors probably won’t benefit quite as much as the markets think — “up to $19B” and “incentives” doesn’t mean that the proceeds go directly to HCIT, it just means that providers are rewarded for utilizing HCIT. There’s a big difference.

It is also important to remember that the government gives and the government can take away. We are highly skeptical of business plans built on the basis of attracting stimulus money. It is important to remember that fundamentally the stimulus incentives are being paid to encourage providers to do something that nearly everyone agrees is in the best interest of the healthcare system. As unlikely and unfair as it might seem, it would not be out of the realm of possibility to imagine a scenario where incentive payments are drastically reduced to help cover some other government shortfall.