HIStalk Interviews John Loyack, Thomson Reuters

John Loyack is director of product management for the healthcare division of Thomson Reuters.

Tell me about Thomson Reuters Healthcare and what you do there.

Thomson Reuters Healthcare is the healthcare and science business of Thomson Reuters. Within that business, we have a variety of business units. The three on the healthcare side are our payer business, management decision support, and clinical decision support.

The clinical decision support business is what you might be most familiar with. It’s a number of different offerings that you loop through to a number of acquisitions through the years, but the Micromedex business is probably the largest portion. Another important element of that business was MercuryMD, which was acquired in 2006 and now referred to as Clinical Xpert Navigator.

I’m the director of product management. I oversee the Clinical Xpert Navigator suite of products.

You mentioned the MercuryMD acquisition. What motivated the company to make that acquisition and what’s been done with the products since then?

I think the motivation there was to embed the evidence that Micromedex had available even further into a clinician’s workflow. Pharmacists, nurses, and physicians were very familiar with using Micromedex products. It is a very well-known brand and has been available for years, but it was one of the things that were obviously separate from clinical workflow.

I think the acquisition of MercuryMD provided a pretty strong answer for that, or at least answers the question of how we further embed the clinical evidence that we know clinical staff are using into their workflow. It’s one of our most recent releases. Pharmacy Xpert is our first introduction on what we refer to internally as our Intelligent Evidence suite of offerings. It’s all based on the Clinical Xpert Navigator platform.

There weren’t many CPOE users in 2006 when the acquisition went through. Now that clinicians are interacting directly with systems, it must be easier to present that decision support and clinical evidence.

It’s true, but providing real-time access and patient data for a variety of clinical staff is just an amazingly important driver for this. It’s something that we hear from users even today — that being able to give their clinical staff access to the right information at the right time remains a critical, critical element that helps them avoid drug events and helps them improve performance in a number of different ways.

I remember MercuryMD being the highest-ranked product in KLAS for years, going back nine or10 years ago. How would you characterize the competitive landscape in which it plays and why the scores have always been so high for what is now the Clinical Xpert product?

Mobile patient data systems were MercuryMD’s sweet spot. Providing a variety of clinicians with access to mobile patient data, making it very intuitive and easy to use, and also, very importantly, something that was a predictable and replicable implementation process — something that we could do over and over again regardless of what type of infrastructure the hospital had.

Even though we see lots of standardization today, one of the reasons we’ve been able to maintain this position is the fact that every hospital we deal with has a very different infrastructure. They’re using different vendors. Even within the hospital’s walls, they may be using one vendor for the ADT system and using a different vendor for the pharmacy. Or maybe there’s been an acquisition and Hospital A has acquired Hospital B and one’s using Meditech and one’s using Siemens.

Being able to provide a bridge over top of that, which also addresses one of the major pain points of physicians, is something that MercuryMD and our Clinical Xpert specialize in. That offering alone and our ability to do that constantly over and over again, and being able to go in and say that we can implement the solution in 8-10 weeks and actually delivering on that, is what led to those KLAS results. That hasn’t changed for us, so even now we see hospitals coming to us to say that they’ve decided to move or standardize with this HIS vendor or that one, and we’re very happy to continue to work with them.

I like to think that we have a pretty good relationship with the HIS vendors. We’re providing something that, from the competitive perspective, not all of them offer. Its technology has increased in a number of different ways, whether we’re talking about the speeds of networks or the computing power of devices, but it is something that I think we, along with just a handful of other vendors, are able to offer today. We’ve been able to maintain that position with KLAS by coming through time and time again in terms of the implementation process.

If I remember right, in the old days, the product ran on synched Palms. I would imagine that the iPhone and the iPad have made mobile application strategy completely different than what it was then. How do you think that’s going to play out as far as how your development efforts will be focused with those new tools for clinicians to use?

You’re taking me for a stroll down memory lane. Our first offering did not have a desktop element at all. In 2000, when we first came out with the MData Enterprise System — which was the MercuryMD product offering — that was something that ran on the Palm OS only. It wasn’t until 2002 that we introduced what at the time it was Pocket PC, but then Windows Mobile.

In 2006, we moved over to BlackBerry.  We’ve got a number of sites that are very happily standardizing on the Research In Motion infrastructure and devices today, but we’re also happy to recently announce that we’ve moved on to iPhone as well. Android is clearly part of our roadmap. It’s something that we are working on now and we’ll keep everyone up to speed on our progress with that.

I think by moving in that direction and by keeping up with what the market is asking for, that’s one of the things that allow us to maintain the position that we’re in and continue to show continued value by keeping up with all this. It’s not easy. You could imagine just on those different operating systems that I just mentioned. I haven’t even given any consideration to all the tablets that have been introduced, or the different web browsers that might be used, but those are the other things that we keep up on as well.

Speaking of the iOS in general, we’re very pleased to put our solution over there. I think the results are going to show for themselves. Our clients are thrilled that we’re able to introduce something that runs on the iPhone, the iPod Touch, as well as the iPad. It’s not just one device that we’re moving to. We’re actually able to, as we move from one operating system to the next, keep up with a number of different devices.

When you look at both the increase in demand because of the iPhone, iPad and iPod Touch applications, and also what people are trying to do with Meaningful Use to be prepared, how do you see those playing together and affecting your business?

I think we’re seeing a very positive affect. Thomson Reuters just issued a statement recently on how we support Meaningful Use in general.

This actually might be a good segue into one of the other things that we’ve done with the legacy MercuryMD product line, but the Clinical Xpert Navigator product suite as well.  We’ve taken a look at a number of the specific Meaningful Use objectives and we’re moving down a path to certify a number of our offerings. I think the most important from my perspective is the CareFocus offering, which is a part of the Clinical Xpert Navigator suite.

Our plan is to certify to support core objectives to implement the clinical decision support rules related to a high-priority hospital condition, as well as giving hospitals the ability to track compliance with that rule. It is something that I think from a mobile perspective, the core offering is still one that’s resonating within the market, but we’ve also moved significantly beyond that by introducing our CareFocus offering.

These two offerings, Clinical Xpert Navigator and CareFocus, are providing us with a foundation for the future of the Thomson Reuters clinical decision support business by giving us our foundation that will allow us to introduce what we’re referring to as our Intelligent Evidence product line as well.

I noticed that in hospital reports about use of the CareFocus system, which I would characterize as a patient surveillance system, some of your users have claimed that they had reduced patient mortality by identifying high-risk patients and then suggesting or offering interventions to clinicians in real time. How important is the real-time aspect of that, and have traditional clinical systems vendors developed something similar?

I certainly hope I don’t come across as dramatic, but it is a question of life and death. When you’re giving someone access to important, constantly-changing information about a patient, giving them access to something that is as close to real time as you possibly can is critical. That’s the kind of thing that our sites, our clients, have seen that has led to the success stories that they’re seeing.

In the past, perhaps you had a critical care response team or a critical assessment team that was ultimately looking at a patient and going through information manually and trying to judge it. A lot of times, we were hearing from some of our clients that it was coming down to a judgment call. Folks were going in, and based on their experience, making a judgment on a patient. Certainly, it’s not something that allows you to predict 100% of the time the true situation with the patient, but if you’re doing that in combination with real-time access to patients, I think that’s a really powerful combination.

By giving users the ability to essentially pull the needles out of a haystack, they can say, “I’m a part of a critical assessment team and these are the five that I need to be aware of right now. These are the five that may potentially crash. One of them recently saw a temperature spike, so I need to go give them the attention they need.”

I think the other element that’s important here is not only is it the surveillance, not only is it the real-time element, but we’re giving them something that’s accessible on a mobile device. We’re giving them something that they can access on their BlackBerry and on their iPhone, so now they’re able to go to the point of care and review those results, or they’re checking out for the day and there was something about that one patient that I wasn’t quite sure about. Now a lab result just called in and I can call back to my partner and ask them to take a look at that patient because something’s just changed and I want to make them aware of it. Without a mobile aspect, without a real-time element there, you wouldn’t be able to react in the time that really is required.

I mentioned the announcement of Pharmacy Xpert, the clinical intelligence dashboard for pharmacists. I know you have some folks that are already using it. Tell me how they’re using it and what the results have been.

I don’t think we’re quite at the point where we’re seeing the results pour in, but we do have a number of sites that are using it.  Shall I give you a description of the product overall?

Sure.

The elements that we’ve been talking about so far — Clinical Xpert Navigator and that platform — that ability to integrate into the hospital’s information system and pull data for disparate systems, that’s the core platform combined with the real-time surveillance solution provided by CareFocus. Those two elements, those two components provide the platform for that.

Built on top of that for the very first time, we have integrated Micromedex content, so things like the DrugDex database, DiseaseDex, Drug, and IV Index. We have some profiles that have been built as a part of CareFocus by our editorial staff — our Knowledge Development Team in our Denver office – who have created pharmacy-specific profiles that are an important element of that as well.

Then we introduced a number of pharmacy applications on top of that where the design actually supports pharmacy decision support. It links into the hospital information system. It provides access to the Micromedex content that pharmacists are used to using. To take things a step further, we’ve introduced a number of calculators that are a part of that. Features and benefits that improve the overall pharmacy workflow and provide the total solution combining all those things together.

It sounds like the focus is going to be real-time information and then either mobile access or push-type information. Where do you take the product line from here?

We have a Patient Xpert offering that is something that’s essentially providing access to patient education from any HIS we’re working with. Offerings like our CareNotes offering — that’s another part of the Micromedex suite. We have a pediatric offering that’s under development.

We have a number of things going on in 2011 that will take advantage of that single, consolidation platform that is complimentary to all the EMR/EHR platforms, but something that addresses a variety of different clinical decision support needs. We can do that through a combination of workflow solutions, mobile solutions, and real-time surveillance combined with the evidence that Micromedex has been well known for.

The mHealth market is pretty big, but if you look at just the part of it that affects physicians practicing in hospitals in the United States, what’s your big-picture view of where you see that whole segment going?

I can promise you it is going to be a lot more mobile. We’re reaching a point where some of the research estimates I’ve seen show that we’re going to be in the 90th percentile in terms of physicians using smart phones or mobile devices or a combination of mobile device and mobile health applications just over the next few years.

In the early days of this business, we were very excitedly seeing numbers — and this goes back to 2001-2002 — that said by 2006 we would see 50-some-percent of penetration of mobile devices being used by clinicians, predominantly physicians. It’s just becoming a more and more mobile world. I think that is something that we are very happily looking forward to and beyond that.

I saw a press release from another vendor recently that talked about the iPad’s impact on healthcare and how healthcare alone was I think, the third-ranked industry that was embracing the iPad and using it in very specific ways today. That’s something that I see — healthcare and mobility are two areas that have gone hand in hand for years and will continue to do so.

Final thoughts?

I think being able to provide one patient platform is something that will allow us to reach many, many users. When I think about the base of users that use our solutions, it’s certainly not just physicians – it’s also nurses and pharmacists. Pharmacists tend to be some of our power users. Certainly physicians, of course, but even beyond that, case managers, care managers, and a number of different folks throughout the hospitals that all have access to this type of solution and tell us what an impact it’s having.

As a part of one of our recent releases of CareFocus last year, we introduced the ability to provide alerting functionality. Or, if one of your CareFocus profiles returned new results, users would have the ability to be alerted by e-mail or text notification. That anyone subscribing to a particular list would be told that a targeted patient had been identified.

We continue to take things that step further. That’s something that has introduced us to even newer audiences. We have folks even within the IT department who were supporting all this and rolling this out to folks who are now some of our user base as well.

It’s been a very interesting ride. I can certainly say that it’s an industry that has been a pleasure to watch grow over the last 10 years or so. There’s still room to grow, which makes it exciting. There are a lot of good things going on.

Monday Morning Update 12/6/10

From Mighty: “Re: CMS. They’ve apparently again changed the MU denominator for the ED.” The FAQ is updated to say that providers must use the same denominator for all measures, either the Observation Services method (ED admissions plus those treated in observation units) or All ED Visits (all patients).

From Catatonia: “Re: UCLA going Epic. LA County is QuadraMed’s biggest client. Not sure if that includes UCLA, but if so, QuadraMed will lose a huge customer just as they are struggling with implementations. Rumor is that the company’s HIM and MPI business will go to Ingenix.” I tapped a key UCLA contact and HIStalk reader, who explained that only UCLA proper is going Epic. LA County is working on requirements for their EHR selection, with the obvious potential bidders being Cerner (already being used in the county’s 200-bed jail hospital), QuadraMed (they’re still running QuadraMed Affinity – not QCPR – in all DHS facilities), and Epic (if they would really want to take on a complex client like LA County). I appreciate that update. I hadn’t heard the Ingenix rumor.

From Wildcat Well: “Re: NJ. The NJ Physicians Group web site enrolls 1,500 docs and receives $350,000 for a EMR selection process while reviewing, in depth, about four out of 200 EMR systems. NJPG has stepped out quicker than the Colts left Baltimore. Now the NJ HIT REC has endorsed ITelagen as the EMR of choice. Will NJ back room deals never stop?”

From Cliff: “Re: sales. I’m working in HIT and would like to move into direct sales. What tips can you offer and who would you consider to be the top 5-10 companies to sell for?” I told Cliff that I have zero sales experience but would open the floor to readers, so feel free to add a comment to this post to help Cliff out, for which I’m sure he’d be grateful.

From RegularReader: “Re: MedAssets / Broadlane. Let the synergy begin! I don’t know if the acquisition has closed, but the layoffs have begun. Many people in the St. Louis office have been given their walking papers and in some cases a personal escort out the door. Happy Holidays! As you say, Mr. H, my condolences to those that have lost their jobs.” I hate to see employees have their jobs taken away, but I’m also aware that nobody wrings their hands for employers when key employees voluntarily walk for a better opportunity. That’s the hazard of employment at-will. Ed Marx said you have to “go to grow” and I believe that, even though for some people they don’t make the “go” decision but still benefit from it in the long run (most of the people I’ve known who were laid off ended up better off). Still, Christmas is always a lousy time to be shown the door.

Listening: reader-recommended Kristy Lee, an undiscovered folksy blues singer-songwriter from Mobile who sounds to me like a cross between Johnette Napolitano of Concrete Blonde and Tina Turner (meaning she has a BIG voice). She’s not a pretty, choreographed lip-syncher – it’s real music that she could play in your living room unprepared if you had a guitar in the corner, which is kind of what music is supposed to be.

The “who’s an informaticist” poll was close, but the winning answer is “clinicians who learned on the job and who have no formal credentials.” A commenter pointed out that the academic and certification programs are new enough that they aren’t common yet. It’s still a divisive topic: 23% of respondents think someone can be an informaticist without either education or clinical experience. New poll to your right, requested by a reader: if you work in a hospital, who does your CIO report to?

Joe Heins PharmD, former Eclipsys SVP and DocuSys COO, joins First DataBank as global product management and marketing VP. I remember him from his Cerner days, where he ran some of its pharmacy systems business. He gets extra points for being in the 1,229-member HIStalk Fan Club on LinkedIn (I’m sending every one of you a Christmas card, so if you don’t get yours, I’m calling that darned post office).

Inga got clarification from RTLS vendor Awarepoint: Jay Deady was named president and CEO last week, but Brad Weinert is still there as COO.

Ashe Memorial Hospital (NC) chooses PatientKeeper’s CPOE, physician portal, and mobile results solutions. Pretty slick stuff for a 25-bed hospital. I’ve been to Jefferson, NC several times and love it — canoeing the New River there up in the mountains is fun, not that that has anything to do with the hospital unless I fall out next time and crush my skull on a rock, in which case I’ll provide a first-hand PatientKeeper update.

Meditech Magic version 5.6.4 earns ONC-ATCB certification from Drummond Group. 

Want to earn your EHR (Esteemed HIStalk Reader) incentive? Here’s the roadmap: (a) put your e-mail in the Subscribe to Updates box to your right, since even if you’re a casual visitor, I guarantee you’ll miss something useful if you just wander over whenever you think about it; (b) Friend or Like Inga and me on Facebook since it’s a publicly visible barometer of our tortured, anonymous existence; (c) send me your news, rumors, pictures, or guest articles about anything HIT related; (d) show some sponsor love by reading and clicking the ads to your left, which will confirm to them that I wasn’t lying when I claimed I had readers; and (e) shake your right hand with your left, pretending it’s Inga and me thanking you for supporting HIStalk even though we may not meet face to face.

The Eye Care Institute (KY) implements the ophthalmology EHR from Medflow, which is an ONC-ATCB certified complete EHR. It’s pretty slick-looking, although some of the screens are unbelievably busy.

A hospital reader from Switzerland sent over a Huffington Post article called Don’t Repeat the UK’s Electronic Health Records Failure. It points out that the UK’s NPfIT, being dismantled after mixed results and colossal expense, is similar to what’s being done here. The reasons it failed, according to the article: it was too ambitious and it was overly dependent in several for-profit companies implementing proprietary systems while offering too little support to clinician users. Their conclusion: HITECH should be slowed down, penalties should be eliminated, and thorough studies should be conducted before mandating EHR use. “Simply following the lead of ‘IT Believers’ and salesmen without the requisite evidence will repeat the UK’s failures.” All valid criticisms, but the big problem is with out Bailout Central: ARRA is stimulus money, so the idea is to just throw the money out there and hope for the best. The real coup for vendors is that providers have to spend money quickly on EHRs to (possibly) earn money quickly via HITECH, which will goose sales a lot more than thoughtful studies.

Marty Mercer sent over the results of a little survey he did of 25 senior HIT sales types (this is for a class he’s teaching). Factoids from it:

• The #1 CXO strategic issue is MU/ARRA, closely followed by access to capital and ACOs.
• The worst things a salesperson can do is to not listen, show up unprepared, make assumptions, and bash competitors.
• The #1 information source was, by far, HIStalk and HIStalk Practice. (thanks!)
• Top pearls of wisdom: prepare before making contact, focus on care quality and not IT stuff, and be patient since HIT sales cycles are long.

Memorial Hospital (CA) uses Skype to conduct virtual visits between moms and their newborn babies that require ICN admission, hoping to reduce separation anxiety. They also use it to let far-flung family members check out the new addition.

A UK hospital says it will save $400K per year by using a privately developed dictation system that will send letters electronically between clinics and physicians. It uses WinVoicePro to create letters and other documents, including progress tracking and countersigning, that are then sent through the hospital’s data transfer service.

Patty Lavely, SVP/CIO of Memorial University Medical Center (GA) will serve as commencement speaker for Georgia Southern’s fall commencement ceremonies at 9:00 a.m. this Friday.

University of Chicago Medical Center chooses Sun SPARC servers and the Solaris OS (both now owned by Oracle) to run Epic.

I’m fascinated for some reason by pictures taken of abandoned amusement parks and formerly famous places, so this video someone took while prowling around the former Mansour Hospital in Jeanette, PA (just outside of Pittsburgh and home to the excellent DeLallo Foods) is both creepy and interesting. The hospital was shut down in 2006 and the bank is trying to sell the buildings.

The Street runs a really good overview of athenahealth and CEO Jonathan Bush. He comments specifically on the risk to his business as hospitals buy up practices that might have become athena customers: “Our job is to be an information infrastructure between various models. Certainly, hospitals have not been our historic wheelhouse, but if you think about it rationally, the cloud-based solution can lower business risk for the hospital CEO. The hospital CEO is taking a multi-$100 million business risk depending on standard health care information software applications … There’s no question that some of these marriages will work, but others, when rates do come down and hospitals can’t subsidize doctors at these levels, will fail. There’s a $100,000 subsidy to a primary care doctor for selling out to a hospital, and for a specialist it’s even higher. How many primary care physicians will bring in one million dollars in business each year for a business like a hospital, with an operating margin of 3%?”

Bizarre: a former hospital receiving clerk is indicted on charges that he stole $4 million from Memorial-Sloan Kettering Hospital by ordering $3.8 million in printer toner cartridges and reselling them. The $37K per year employee lived in Trump Tower (!), with neighbors wondering where he was getting his “his car, his jewelry, and his women.”  Imagine what he could have done with drug ordering.

So how do you work this into the healthcare cost equation? Partners HealthCare makes a $195 million profit for the fiscal year (much of that from your taxpayer dollars in the form of stimulus money for research) even as other Boston-area hospitals struggle to keep their doors open.

A high school basketball coach who saves his star center’s life by performing CPR on him after the boy collapses in practice credits a $1.99 iPhone app. The coach had purchased the app the night before and went through it as a refresher. It includes pictures, voice instructions, single-button 911 dialing, and other first aid advice.

E-mail me.

News 12/3/10

From EHR Geek: “Re: Sunquest. Gets bought again.” Several readers sent this link over. Huntsman Gay Global Capital LLC is leading an investor group that’s planning to pay $208 million for 51% of hospital ancillary systems vendor Sunquest Information Systems from Vista Equity Partners, which paid Misys $381 million for the company in 2007. There’s some tricky financing involved, with Sunquest apparently borrowing $655 million. The deal values Sunquest at a healthy $1.2 billion. I asked one of my Wall Street experts to explain. He said it’s “an odd transaction structure and a risky one” because of the amount of debt and the chance of changing conditions that could make it hard to repay. The big winner is Vista, who gets multiples of the cash they put in just three years ago and gets to keep 49% of the company. I asked Inga to contact Sunquest for a statement, but obviously they can’t really say anything, so she got the expected “we can’t comment.” Huntsman Gay, started by the guy who invented those environment-fouling Styrofoam Big Mac coffins and who also served in Nixon’s White House (but atoned somewhat for those sins by becoming a philanthropist), appears to have no other healthcare holdings is pretty much all over the place in its $1.1 billion fund (oilfield maintenance, bedding, business process outsourcing, and equipment for electrical utilities). Maybe BCBS will be somehow involved since a company subsidiary runs a venture fund for them.

From Epicdude: “Re: Epic. UCLA just signed an enterprise contract.” Unverified, but I found fresh UCLA job postings looking for Epic people.

From Wildcat Well: “Re: what are we missing here? The American College of Physicians, based in Philadelphia, birthplace of the US, presents AmericanEHR, developed with Cientis Tech of … Canada.” Maybe they left off the North part.

Weird News Andy first pointed out that bedbugs shut down a hospital floor, but he amended that statement that PEOPLE were the problem. NYU’s Hospital for Joint Diseases closes an entire floor because a patient claimed she saw a bedbug. Sick outpatients were told not to come in, leading one quoted in the newspaper to say she’s taking her business to Beth Israel. I don’t know that I blame her: does one unverified bedbug sighting really justify closing a hospital floor, especially given the far more dangerous bacterial types crawling all over? Maybe it was a ruse to get a less-affluent Saudi royal their own entire US hospital floor like the King got over at NYP.

WNA also weighed in with a “Say What?” on my story about patients in China having to pay cash for medical services because someone stole the cable carrying a hospital’s Internet connectivity. He summarizes thusly: “We moving towards a government-run health care system and people in China have to pay out of pocket? Weird news indeed.”

The Meditech 6.1 implementation at Kootenary Boundary Regional Hospital (BC) apparently went well, judging from the lead story in their December hospital newsletter. From the picture of their war room, you can almost smell the stale leftover “everything” bagels, human sweat from IT people working long shifts, and the oxygen-depleting fumes emitted from overheated laptops and whirring laser printers.

In England, the National Accounting Office will investigate the $850 million contract that BT got last year, with MP Richard Bacon suggesting that up to $695 million of that amount was excessive given the scope of work performed.

I got paged at home tonight by the hospital and dialed the number on the cordless phone. Nothing happened. Then I realized: it’s not like a cell phone where you dial and then press the button – you have to press the button, get a dial tone, and then dial. My brain knows this, of course, but my fingers sometimes forget because I don’t dial the land-line all that often. I bet I’m not the only one.

National eHealth Collaborative is looking for new board members. Your hat must be in the ring by December 22 (and yes, shockingly, it’s December already).

Omnicell announces a new version of the Pandora drug diversion detection system it bought in October. They’re at ASHP, of course, like most vendors of anything pharmacy-related.

Terri Steinberg MD MBA, CMIO of Christiana Care, sent over their patient safety submission that just won them a Cheers award from the Institute for Safe Medication Practices. She mentions some ways to influence doctors via CPOE that I had talked about the other day: when considering the choices to offer, put the best one first, make it the default, and standardize the list. They won the award for work with hydromorphone injection, with better success with CPOE than they’d had on paper. They defaulted lower doses, forced choosing a pain scale reason for high doses, required an indication for use, and added CPOE dosing alerts. They successfully reduced too-high initial doses and increased the number of doses within the recommended range. I’ll stick with what I’ve always said: CPOE will reduce some errors, but its greatest (but less flashy) benefit is helping doctors do the right thing, or as the paper says, “prescribers will not go out of their way to change predefined content unless warranted by unique patient characteristics.”

Cerner shares have been on a rocket lately, going from the mid-70s in September to Thursday’s close of $92.03. Market cap is $7.62 billion, pushing the value of the holdings of founders Neal and Cliff to nearly $400 million each. That’s a one-year chart above.

Jobs on the sponsor-only Jobs Page: Payor/Provider Connectivity Product Manager, RN Clinical Content Specialist, Segment Marketing Manager, VP Solutions Management ePharmacy. On Healthcare IT Jobs: Director EHR Systems Division, Horizon Physician Portal – Remote, Implementation Engineer – Integration, Epic Clarity Interfaces Security.

A former Deloitte Tax LLP partner and his wife are arrested for insider trading. The SEC says they gave tips to family members about impending transactions, including the buyout of Kronos by a private equity firm in 2007 and the McKesson acquisition of PerSe that same year.

RAPID Chiropractic Software is certified by CCHIT as an EHR module, giving its chiropractor users a shot at getting 44,000 taxpayer dollars for demonstration Meaningful Use.

Strange: the website for 988-bed Guam General Hospital has some interesting pictures, job postings, and contact info that includes a toll-free number. The problem is, there’s no such hospital – the pictures are of other hospitals and the telephone number has an Atlanta exchange. The local newspaper called the number and the guy who answered said it was indeed the hospital. They’re speculating that it might be a hiring scam that targets nurses from the Philippines. The FBI is looking into it.  

You just know that WikiLeaks is going to eventually expose something on a hospital or healthcare agency. While you wait for that, note that one of the confidential government documents it just released says that Venezuela’s hospitals are a mess – loaded with crime, unpaid suppliers, and doctors quitting medicine. Blamed: inefficient community clinics that provide free care, many of them staffed by Cuban doctors making $400 per month, that take funding away from the public hospitals that the public prefers.

E-mail me.

HERtalk by Inga

Former Eclipsys EVP Jay Deady joins Awarepoint as president and CEO. Before Eclipsys, he was a SVP and GM at McKesson Provider Technologies and a GM and VP with Cerner. Curiously, the press release doesn’t mention what happened to Bruce Weinert, who is still listed at president and COO on the Awarepoint website. The seven-year-old Awarepoint recently raised $9 million in a combination of equity and debt.

Evan Steele of SRSsoft says the company has listened to its customers and will seek ONC-ATCB certification for its EMR. Steele has been an outspoken critic of Meaningful Use criteria, suggesting the measures negatively impact physician productivity and are not relevant for specialists. However, Steele says participation has become more inviting since David Blumenthal recently clarified the exclusions that can be claimed by specialists.

Norton Healthcare (KY) will use Microsoft Amalga and HealthVault for its regional accountable care organization.

The US Army is testing EMR applications on the iPhone and Android devices to determine if they can be used in the field. Some of the hurdles include encryption requirements and signal certification from the DOD and local sources.

Health system value in the US is getting better in some critical areas and slowly gaining ground on its international competitors. According to the Business Roundtable’s Health System Value Comparability Study, the US is behind its G-5 peers, but is making substantial improvement as hospital errors are reduced and smoking rates decline. Rising obesity levels and per capita healthcare spending are two of the biggest factors keeping the US’s health system value behind Canada, France, Germany, Japan, and the United Kingdom.

Hillsdale Community Health Center (MI) goes live on CPSI’s electronic medical records.

The Senate unanimously approves legislation to exempt small businesses, including physician practices, from Identity Theft Red Flag Rules. The bill now goes to the House.

The Leapfrog Group names 65 hospitals to its 2010 Top Hospital list, based on a survey that measures hospitals’ performance in patient safety and quality. Kaiser and Northshore University did particularly well, taking 20 of the spots. It’s interesting to note who made the list, and, possibly more interesting to consider those who were not mentioned (Johns Hopkins, UPMC, MD Anderson, UCLA, Mayo Rochester, Mass General, etc.)

As part of a draft privacy report, the FTC proposes a “Do Not Track” list that would allow consumers to stop web sites and services from tracking online browsing. The report also recommends that businesses not store more information than necessary to meet specific business purposes, suggesting its use to build consumer profiles raises privacy concerns. For example, “the retention of location information about a consumer’s visits to a doctor’s office or hospital over time could reveal something about that consumer’s health that would otherwise be private."

New on HIStalk Practice this week: a new poll for practices, asking if they are currently running an ONC-ACTB complete EHR.  Also, medical liability insurance rates increase for providers adding EHRs. The non-traditional president of Physicians Computer Company. Dr. Gregg Alexander dishes on some recent EMR demos. Dr. Alexander, by the way, sent me this shot of the HIStalk Practice hit counter, which hit the 200,000 visitor mark today when a reader from Harvard dropped by.

Dick Hull joins Acuitec as VP of business development. He was previously with Premise and Surgical Information Systems before that.

The ONC sends the Office of Management and Budget a final rule to establish a permanent EHR certification program. The temporary certification program is expected to run through December 2011.

I am happy to report that my laptop is back home, safe and sound. For $65, my local computer nerd cleaned things up and removed several viruses (including a root virus), malware, and trojans. I am now running Symantec Endpoint Protection (for those of you that asked,) as well as the Mr. H-recommended Spybot Search and Destroy. I appreciate all the advice from readers, except the clever individual who suggested I stop downloading porn. Maybe next time I need a computer I will go the Mac route, but for now, I am feeling relatively safe from the unwanted PC infiltrators.

Sponsor Updates:

• Cumberland Consulting Group promotes Joe Mayberry to executive consultant. He joined Cumberland a year ago after three years with Accenture.
• Ashe Memorial Hospital (NC) purchases PatientKeeper CPOE, Physician Portal, Mobile Clinical Results, and NoteWrite.
• MEDecision is named as one of the 100 best places to work in Pennsylvania.
• Apple Valley Medical Clinic (MN) chooses e-MDs for its 13 family physicians.
• The VA awards Picis a contract to implement its perioperative solutions across the VA’s Stars & Stripes Healthcare Network. With this contract, a total of 42 VA hospitals have selected Picis solutions.

E-mail Inga.

Readers Write 12/1/10

Submit your article of up to 500 words in length, subject to editing for clarity and brevity (please note: I run only original articles that have not appeared on any Web site or in any publication and I can’t use anything that looks like a commercial pitch). I’ll use a phony name for you unless you tell me otherwise. Thanks for sharing!

To Be or Not To Be — Certified; That is the Question
By Frank L. Poggio

The ONCHIT Certification process is in full swing. There are three interim firms designated as Authorized Testing and Certification Bodies (ATCB). Over 100 products and about 70 firms have been approved. The key question is this: should you, as a vendor or in-house system developer, get certified? 

I think we all can agree that if you sell a full EMR or EHR system to health providers, certification is a must. If you do not get certified, it is unlikely you will install another new client. Worse, your existing clients will start leaving in droves.

But what if you are a niche vendor? What if you sell a best-of-breed (BoB) package, such as a lab system or a therapy or a dietary system? And what about vendors that sell smart medical devices?

For these situations, according to a strict interpretation of the rules, you do not have to get certified (unless, of course, your clients and prospective clients request that you do). And therein is the rub. ONCHIT is not telling vendors they must get certified before they can sell systems (as does the FDA for blood bank software). ONCHIT is going to let the market tell you.

The potential impact of the Meaningful Use bonus / penalties can add up to millions of dollars over the next five years for a given health facility. The responsibility for realizing bonuses and avoiding penalties will fall on the CIO (or maybe COO) of the health facility. If the facility misses out on a bonus or gets hit with a penalty, it is likely that the responsible executive’s job is on the line.

Given that real personal concern, it is fair to assume the CIO /COO will purchase only certified systems and de-install ones that are not.

Even in situations where a niche product does not directly deal with certification “modules”, it could put meeting MU approval at risk. In a recent discussion about certification by the HITECH Policy Committee, it was explained that if you have a ONCHIT-certified clinical data warehouse and use it to generate quality and MU performance measures, if a non-certified system accesses the warehouse and/or places data into the warehouse, the warehouse could be deemed non-certified. I call it “contamination through association”.

Considering the vast amount of PHI and clinical data that moves daily to and from interface engines while finding its way into, and passing through, multiple systems, you can see where a CIO/COO would not want to take a chance on a non-certified product, regardless of how insignificant the application may be to the overall facility’s operation.

This “contamination” issue is not unique to facilities that favor best-of-breed solutions. It cannot be avoided by purchasing an EMR from a single vendor since no single vendor covers the complete waterfront for all applications needed by a provider.

In fact, many medical device vendors will be faced with the same challenge. For example, if a device such as an IV pump, drug dispensing cabinet, or digital imaging equipment is considered “smart” (that is, receiving and communicating patient information and communicating the data over the core hospital infrastructure), then if the device is not ONCHIT-certified, it could be deemed as a potential “contaminator”, thereby rendering the entire EMR as non-compliant and not eligible for MU. Remember: fail just one criterion and you don’t get a bonus.

Unfortunately (or fortunately, depending on your view), there is a now a new cost of doing business in the health systems marketplace: ONCHIT certification. The unfortunate outcome may be that this is a new barrier to entry and will scare off new HIT startups while further embedding the current ones.

The second challenge for a niche IT vendor or device manufacturer is navigating your way through the MU “module” tests. There are 44 certification criteria today.  Additional ones are promised for Years Two and Three that will increase the list by orders of magnitude. As a niche player, your product(s) is considered an “EMR Module” and does not have to meet all test criteria. You are required to meet eight privacy and security tests and just one of the remaining 35.

But this may create a real competitive concern. What if you are a BoB vendor or have a smart medical device and none of the 35 criteria apply to your application? From a regulatory standpoint, you do not need to go through certification. Yet your arch-competitor’s application touches just one module criteria and they submit on that one along with the eight P&S criteria and get certified. Whose product or software will the CIO be most comfortable with?

On the surface, you may think it best to try to meet as many criteria as you can, but there are real risks and costs in doing that. Selecting which to pursue, and which to pass on, must be both a strategic marketing and critical development decision.

In summary, it’s hard to see how a niche player can avoid diving into this pool. The more important question is — how deep? 

Frank L. Poggio is president of The Kelzon Group.

Is Your Vendor About to Deflate?
By Alan Jack

One of the problems in HITland is the inability of many vendors to hire and keep talented staff, especially in the R&D area. Compared to other sectors , healthcare software companies pay lower salaries, need folks to stay on call 24 hours a day, have long hours, etc. Many vendors do not have great internal cultures, either. The result is that many companies have a reputation problem.

When demand for software developers is good, HIT companies start having problems recruiting, while at the same time, headhunters are targeting their employees. Added to the normally high turnover in the software industry, the losses can start snowballing as workloads go up and more folks bail. Developer numbers will start shrinking despite efforts to recruit more. Software will be delayed just at the time when it is needed most.

Do not think that the vendor will willingly disclose issues with customers. The total headcount at companies experiencing issues will likely be going up, in fact, as other roles are hired: project managers, sales and marketing, and other folks in the easier-to-recruit categories. Employees will often switch roles in those time periods, requiring backfill.

As the economy comes out of the Great Recession, this will become an increasingly difficult problem to deal with. Several companies I’m familiar with are already having issues recruiting.

Given that software developer degrees area unpopular with college students at the moment and the reputation problem companies are having have spread overseas to areas where H1B visa people are recruited, don’t look for things to change soon.

Back to School For a Master of Biomedical Informatics Degree – Part II
By Jeremy Harper

Many HIStalk readers are past the career stage where education adds life-changing value. In fact, they are the men and women who will be interviewing and hiring students in the upcoming years.

This post will discuss the differences students will offer from someone who has experience, but no formal education. It will also discuss some of the general education required for a MBI. Lastly, it will briefly mention internships and how a proactive company could interact with students who would be more inclined towards working at their company upon graduation.

As you saw in my introductory post, I am at the beginning of my career. While I have seen a rapid progression in my career, having entered the full-time healthcare work force in 2007, it would probably take an additional 20 years of experience and luck before I could become a CIO without higher education.

What this degree shows for me — and every other student — is that the person receiving it has a passion for the industry. It shows that that the student is willing to take years out of their life to receive a breadth and depth of knowledge that cannot be equaled solely by work experience. It shows they can determine a long-term goal and marshal the necessary resources to achieve it. These are valuable skills to consider when hiring these students to senior team member and management positions.

As someone with experience at both a vendor and a hospital system, I know the value that real-world experience offers. However, that same experience has a narrow focus. A formal educational setting is changing my perspective on past work to look beyond the scope of the project to see how it fits into the overall arena.

This quarter in pathophysiology, for example, we’re doing clinical reviews every week with a physician. We learn how to do the same types of HX&PE medical students perform (lacking their expertise, of course). We will also shadow a healthcare provider with the specific goal of observing their workflows and reporting them to our fellow students.

The people leaving these degree programs will educated in a variety of different methods, but they will have the ability to adjust and learn to use any system necessary to accomplish a goal. Students learn about disparate topics like database structure, biostatistics, and report writing. This provides a confidence to accomplish more than a work force operating solely on experience.

As a real-world example, I have interacted with two separate interface teams closely in my career. One had exceptionally practical experience, having learned via the school of hard knocks. The other also had practical experience, but also formal clinical education prior to working with the interfaces.

The former team would not modify any data pushed through the interfaces. The closest to modification they would come was translation tables. The latter used their specialized knowledge and depth of understanding to successfully accomplish a stronger interface between two systems that did not inherently talk to one another or have data that could be simply translated with a table.

To close, the OHSU program requires two quarters of real-world internship in whatever specialized field the master’s degree student chooses. In general, the other programs I investigated also required some type of internship and capstone.

These programs had a wide variety in what they were looking to accomplish with the internship. Many past projects from my research were evaluations of an EMR implementation, assisting with EMR implementations, working for software vendors on improving their product, or doing general research for scientific endeavors.

If you have a school in your area (check here)or an internship that can be done remotely, you can start forming professional relationships with these schools and students that will enrich your work force.

Jeremy Harper is a student at Oregon Health & Science University of Portland, OR.

News 12/1/10

From Specialty EHRland: “Re: ONC FAQ regarding Core and Menu Set items. I sent this question to ONC in September and they punted to CMS, which hasn’t answered. The rule is unclear as to whether vendors must require their clients to pay for and use all components of the certified complete EHR even if the client chooses not to qualify using those menu set measures. Why should a vendor of specialty systems where diagnostic lab results and growth charts are outside the scope of provider practice be forced to develop those features knowing that the providers will be given an exception by ONC and CMS anyway?” This was in response to a confusing ONC FAQ that I tried to interpret. I think the intended guidance, despite some misinterpretation by some publications, is that vendors must demonstrate capability for all Menu Set items to earn certification even if all of their customers plan to pass on those items in meeting their required five of 10 Menu Set items. The impact is on vendors, in other words, not customers (other than having to pay for features they know they won’t use).

From Frank Drebin: “Re: Black Book Rankings. Have you heard anything about the quality of their market research? I’m not wealthy enough to purchase the results of their recent HIT vendor surveys and I’m not an expert in statistical analysis, sadly, although it does not sound dissimilar to what KLAS already does. As a side note, I have three co-workers and a few nurses still quoting, ‘There is a fracture. I need to fix it.’ whenever we run into pedantic problems.” I don’t have a clue – the company seems to popped up out of nowhere with press releases blazing. It’s a recently acquired subsidiary of Datamonitor and one of the principals was Doug Brown, formerly of Avega and McKesson. Their site lists the vendors by category in order – alphabetical, that is (seeing them in score order costs from $799 to $4,995 per report). They sell the reports only through Amazon, oddly enough. Here’s the excellent “Orthopaedics vs. Anaesthesia” cartoon that won me over.

From Wildcat Well: “Re: Black Book Rankings. They rank top EMR vendors, which includes … everyone. Next they can rank the top 32 NFL teams. Morons.”

From Truth Seeker: “Re: news postings. A group says it’s posting stories on KevinMD and The Health Care Blog, saying they are the two most widely read healthcare blogs in the United States. What about HIStalk?” I don’t follow KevinMD, but HIStalk gets more readers than The Health Care Blog. October numbers: THCB, 67,534 visits, 110,191 page views; HIStalk, 95,366 visits, 134,141 page views. Maybe they’re talking only general healthcare sites.

From Mr. Excitement: “Re: Cerner. How ironic it is that they’re being snake-bitten after all those years of selling snake oil.” Cerner’s $400 million office building and soccer stadium project (of which $232 million is being paid by Kansas taxpayers) is jeopardized when two endangered snake species are found on the site.

From Charles De Mar: “Re: CEO salaries. Sturdy Memorial Hospital pales in comparison to its New England counterpart Lifespan, where the non-profit CEO took home a $9 million payday and employees had no raises that year.” I’d like to say that shocks me, but hospital executive salaries are so ridiculous that it doesn’t. Tiny hospitals paying million-dollar salaries is just absurd.

From RFIDebaser: “Re: HIMSS RFID technology. You wrote about HIMSS using RFID to track attendees on the exhibit floor and in educational sessions. You should ask them to talk about what exactly they are doing here and how they will use/sell the data. You can opt out at registration, which I will.” A few folks got worked up when I wrote that HIMSS will use attendee-tracking RFID chips embedded in the conference badges, but most didn’t seem to care. The idea is that your chip feeds leads to vendors in real time and allows them to deploy salespeople when someone of lofty provider rank enters their perimeter. The opt-out wording says that vendors won’t see your e-mail, phone, or address if you allow them to track you like a stray dog, but only the dimmest of vendors won’t figure out how to Google that since they’ll have your name, title, and employer. Needless to say, I’d recommend checking the opt-out box (or disabling the chip).

From The PACS Designer: “Re: Swype. Inga mentioned ShapeWriter this past June, which is now a division of Nuance Communications. ShapeWriter’s Swype application is now becoming a quite popular choice for replacing keyboard touching to speed up data entry in mobile apps and could help win over physicians who shun typing into medical records while treating patients.”

Weird News Andy concludes that “It’s good to to be the King,” at least if your kingdom sits on a lot of oil. King Abdullah, monarch of our supposed democracy-loving ally Saudi Arabia, has everybody else booted from the entire VIP wing of New York Presbyterian / Weill Cornell Medical Center so he can recover from back surgery in private. Relocated, lower-ranking VIP patients are whining that he’s getting special treatment, apparently missing the irony completely. I guess the hospital runs itself like any other business, taking the highest bidder’s cash in return for hanging out a “closed for private function” sign that keeps the tax-paying citizens away from its not-tax-paying doors.

Allscripts VP Rich Elmore, who the Communications Workgroup leader for ONC’s Direct Project (formerly NHIN Direct) offers this clarification of Direct vs. CONNECT:

The Direct Project (formerly NHIN Direct) is a project to create secure transport specifications for point to point messaging of protected health information using the Internet. While the Direct Project does make it easier for providers to communicate directly with one another, this is in comparison to the fax machine, not CONNECT. CONNECT is a software stack that implements health exchange specifications. The CONNECT roadmap includes support for the Direct Project specifications, which will allow any organization running the CONNECT stack to implement the Direct Project specifications.

I: Global Intelligence for the CIO will be running a version of Ed Marx’s July HIStalk post called The Authentic Leader (Death to the Cliche).

The Economist is running an Oxford-style debate and poll on privacy, pitting Microsoft’s Peter Neupert against Patient Privacy Rights’ Deborah Peel. Two-thirds of voters are siding with Peel so far.

Athenahealth CEO Jonathan Bush compares data-sharing among providers to friending someone on Facebook, describing an athena service that will allow providers to share and update patient information. That’s an alternative to “financial integration”, which he describes as the Kaiser-like model where hospitals buy other providers just to assemble their data into a single, proprietary repository.

Indian IT services vendor MphasiS, whose majority owner is HP, says it’s testing a new HIM product for small- to medium-sized hospitals in emerging markets as its entry into healthcare.

Internet image-sharing vendor lifeIMAGE integrates its product with Microsoft HealthVault, allowing physicians to send images to a patient’s account.

An iSoft press release touts the huge reduction in prescribing errors enabled by its medication management system. My critical review based on the abstract of the original work (since I don’t feel like paying for the article itself): (a) the study involved only 72 patients in four weeks as the “before” group and 58 patients in five weeks as the “after”, all of them patients in a psych unit where medication usage is about as different as it can be from the usual med-surg unit; (b) the rate of the most significant errors, such as wrong dose or wrong drug, didn’t change; (c) system-related errors averaged nearly one per patient. In other words, patients didn’t really benefit since the errors prevented were minor or almost certain to have been caught anyway. That’s usually the conclusion of studies involving CPOE, mostly because they focus on error reduction instead of improved ordering practices (putting the best choices first on the selection list, giving only reasonable choices, calling attention to duplicate orders, improving the timeliness and accuracy of order delivery and response, etc.)

Speaking of iSoft, acting CEO Andrea Fiumicelli is announced as CEO at the company’s annual meeting in Sydney. He was previously COO. The call transcript is here. Most of it involves reduced revenue because of the fall of NPfIT, cost-cutting measures, the hope of selling systems outside of the UK, and the usual streamlining efforts (reduced locations, discretionary spending freeze, sunsetted products). They’re still confident in Lorenzo given its relative youth and sales prospects outside of NPfIT, including in the UK itself as more NHS trusts get to make their own decisions.

Australia’s government says its $380 million (US) telehealth program may install service centers in drug stores and could be staffed by non-physicians for online consultations of low-acuity medical problems.

A hospital in China loses telephone service and Internet connectivity for the second time in a month when someone steals a section of telecom cable running through an apartment complex. Doctors wrote bills by hand and patients had to pay in cash.

University of Iowa Hospitals and Clinics says the MyChart part of its $60 million Epic system is a hit with patients, with 35% of them activating their account, 48% of those checking lab results online, 12% looking up appointments, and 11% sending an electronic message to a provider.

Piper Jaffray is holding its healthcare conference in New York right now (November 30 – December 1).

The odd campaign promise by an incumbent Australian politician to buy every doctor an iPad with government money is apparently history after he loses the election.

In England, NHS lists a few abuses of its emergency services: a woman who wanted her toenails clipped, a drunk man brought by ambulance because his wife locked him out of the house, and a child brought in because she had stepped in dog droppings and her mother was too squeamish to clean her up herself.

E-mail me.

HERtalk by Inga

From Hercules: “Re: Cerner fun fact. There’s a full gym right on the Cerner campus with trainers. Most associates don’t use it unless they are trying to get promoted quicker, but this does eliminate the need for them to leave the parking lot.” I figured that Neal Patterson was a pro-fitness kind of guy, given his strong support for soccer. Funny that fitness helps those on the fast track.

KLAS recognizes DR Systems as the leading PACS vendor for large hospitals with Infinitt ranking first for community PACS. In the same report, 92% of KLAS respondents say they don’t plan to replace their PACS in the next few years.

MedLink completes an aggregate of $2.25 million in financing, including $1 million in private placement. It will use the money to increase sales and marketing efforts, for working capital needs, and for the acquisition of MedAppz.

Hill-Rom hires Brian Lawrence as SVP and CTO. He was CTO of Life Support Solutions for GE Healthcare.

M*Modal and Virtual Radiologic announce a strategic partnership to integrate M*Modal’s Speech Understanding technology into the vRad Enterprise Connect 3.0 Technology Suite.

Genesis HealthCare System (OH) deploys BIO-key’s biometric identification solution, enabling clinicians to establish their identity when ordering or administering meds in Genesis’s Epic system. In its next phase, Genesis will implement fingerprint biometric user logon with the Sentillion Vergence SSO product.

Bill Sterling, the former director of healthcare systems for Vocera, joins clinical workflows company EXTENSION as VP of channel and business development. Maybe he can convince them to ditch the all-caps name.

The CFO for Cincinnati Children’s Hospital Medical Center says the health system plans to add 500 new employees over the next year, in addition to the 480 who were hired over the last year.

Advocate Good Samaritan Hospital (IL) wins the 2010 Malcolm Baldridge National Quality Award in healthcare, which honors performance excellence through innovation, improvement, and visionary leadership. Other healthcare-related winners included MEDRAD(medical devices) and Studer Group (healthcare coaching and consulting). 

A subsidiary of Wolters Kluwers Health enters into an agreement to acquire Pharmacy OneSource, a provider of clinical decision support tools for the hospital pharmacy market.

The Leapfrog Group names the University of Maryland Medical Center and Virginia Mason Medical Center (WA) as its Top Hospitals of the Decade. The recognition was based on their public commitment and patient safety and quality innovations.

I don’t recall if I had mentioned this before, but Mr. H generously bought me a new laptop over the summer. The 30-day trial version of antivirus software ran out a few months ago and I have been “too busy” to load new antivirus. I am now realizing that was a pretty stupid excuse since I have now picked up a nasty virus which is preventing me from getting on the Internet. After spending an hour cursing and trying to fix it myself, I took it to a local computer nerd for repair. Now I’m working on the old laptop, which is missing four keys and runs slowly. I only mention this as a reminder, just in case you are also one of those really busy people that has failed to keep your antivirus current. It’s best to take care of these matters as soon as possible in order to reduce the number of expletives you utter.

The CIO of Northern Hospital of Surry County (NC) says the hospital’s implementation of EMC and VMware virtualization solutions has allowed them to eliminate 20 physical servers, decrease power usage, and reduce network congestion. Northern Hospital claims it has saved hundreds of thousands of dollars despite a 30-40% growth in data and the addition of a couple thousand medical devices.

Tensions appeared high at a recent Regional Medical Center (SC) trustee meeting. Trustees were informed that for a one-month period, charges from the pharmacy system were not passing to the billing system. The hospital is working with their HIT vendor (Cerner) to resolve the problem , but had to reissue 3,600 bills. The situation did not please trustees, who had just approved  an additional $2 million for the hospital’s Cerner project, including $628,000 for Meaningful Use upgrades. Now here is where things get a bit testy. One trustee, Danny Covington, says that if the hospital had used Meditech, it could have met the Meaningful Use objectives for less money. Here is the play-by-play in the local paper:

"That is not so," trustee Milton Dufford said.

"I know you want to believe …" Covington said.

"Don’t tell me what I am going to believe now," Dufford said.

"You wanted to believe that we had everything for ‘meaningful use,’" Covington said. "What you think and what you believe are contrary to the end result here."

Why can’t we all just get along?

The 70-provider Riverside Radiology and Interventional Associates (OH) adds ZixGateway Inbound to scan incoming e-mail for unsecured PHI.

CHRISTUS Health and United Regional Health (TX) are some of the dozens of healthcare customers who recently signed up with Catapult Systems for Microsoft IT consulting services.

A study published in the Archives of Internal Medicine concludes that lower-income families with out-of-pocket medical expenditures are more likely than higher-income families to delay or forego medical care. They are also more likely to question services requiring out-of-pocket expenditures.

Sponsor Updates

• ICA wins Best of Show honors in the provider and insurance categories at the recent Everything Channel’s 2010 healthcare IT summit.
• Wellsoft ties for first place in the best of breed category in KLAS’s recent EDIS report.
• The 13-physician Apple Valley Medical Clinic (MN) selects e-MDs for its EHR and PM system.
• Indiana Hand to Shoulder Center (IN) will implement SRS Unified Desktop (PM, EMR, PACS) for its 35 providers.
• Springs Memorial Hospital (SC) chooses the check printing solution of the Access Enterprise Forms Management suite.
• Orion Health announces that its HIE solution has been enhanced to include a modular suite of components to match specific needs of individual healthcare organizations and allow them to scale out projects over time.
• Nuance Communications introduces PowerScribe 360, a radiology and communications platform that combines capabilities of PowerScribe and RadWhere. The solution also works with Dragon Medical to provide core radiology reporting.

E-mail Inga.

CIO Unplugged 11/30/10

The views and opinions expressed in this blog are mine personally and are not necessarily representative of current or former employers.

Go to Grow

In 2007, I dropped off my oldest child at Biola University in LA. We arrived a few days early so Brandon and I could attend the student-parent orientations. In the name of father/son tradition, we also squeezed in some workouts and ate bad but tasty food.

After we got his belongings organized in his dorm, we huddled for a final prayer and blessing. We embraced, shed a man-tear or two, and then I left. Sitting in my car in the parking lot, I watched him walk to the final student orientation.

Leading up to this point, I had planted seeds: encouragement to grow, encouragement to test his personal boundaries, and warnings against complacency. Brandon was officially beginning his journey into the future and to independence. The results of my optimistic seed planting were soon to blossom.

What happened next surprised me. As I drove down the Pacific Coast Highway, I began to wail. From the depths of my soul, I cried so hard my stomach convulsed. Wheezing in breaths, I mourned my treasured son’s rite of passage. Then mourning turned to dancing, and I rejoiced for Brandon and his future. I can only imagine what the drivers in the cars next to me must have been thinking of my spectacle. I pretended to be singing.

Three years later, Brandon graduated. We’ve seen amazing growth in our son — growth that could not have occurred had he stayed home. Despite an enriching and loving environment, his potential would not have been fully realized without a dramatic change and challenge. Part of us would have loved to have him stay, but we knew and accepted the truth that he needed to go to grow.

My career has been much the same. I can’t think of a single employer that I have ever wanted to leave. Yet with each one, I knew at some point I’d need to go to grow. Indisputably, my former employers offered ample career growth and challenges. But to gain exponential growth, I had to enroll myself on a journey of sorts. I had to break out of my comfort zones and push the envelope of security.

Each successive move has pushed me out of man’s natural bent toward complacency. They’ve shaped and sharpened my abilities. The breadth and depth of divergent experiences have broadened my skill set in an extraordinary fashion. My talents have gained a sharper focus and my leadership quotient has multiplied. I have become a better servant. I attribute my personal and professional growth to pushing my boundaries and circumventing the traditional career path.

Naturally, we need to create internal opportunities and have career ladders — something for every kind of employee. Yet at some point, the best thing for some will be a new environment, a place that challenges them to accelerate to the next level. I believe it is a leader’s imperative to fight complacency in the workplace and encourage others to go to grow. If it benefits our children and ourselves, then we must be willing to encourage subordinates and peers to do the same.

Sound inconceivable? Untraditional? Scary? An exceptional leader is not afraid or insecure to give away their best.

I have helped some of my best go. I have brought them opportunities for external advancements and served as their reference. At each departure, I felt the loss of their daily presence, skills, and talents. I cried in secret, yet I never regretted a single endorsement. I’ve stayed in touch, and what a thrill it is to see how they’ve grown in ways far more enriching than the opportunities I or my employer could have given them. They had to go to grow, to reach their fullest potential.

I recall a sunny afternoon run along the San Diego harbor with one of my colleagues, the president of a well-known hospital. We spoke about “go to grow” and the fruit we have seen in careers as a result. He resigned a short time later, citing this conversation as the catalyst for him to leave a secure position and take on a new growth opportunity leading a health system on an opposite coast. Catching up recently, he shared that it was the best career decision he had made. His growth has proved exponential.

Are there people in your life and work who need to go to grow? Does complacency have a hold on your organization? Are you selfishly clinging, or do you have a heart to see the best opportunities made available? (Picture the able-bodied forty year old still living at home).

If one of your staff has significant potential but circumstances are such that you can’t fully exploit that, do you give that person the freedom to advance elsewhere? Are there other staff members who need you to encourage them to leave for these same reasons but who won’t on their own out of fear?

We only have one year left with our teenage daughter. We will cherish every minute. But we’ll also do our best to prepare her mind to take on challenges and enriching opportunities. In love, we will push her to learn from the past and fail forward, to maximize the present in preparation for the future. Ultimately, the time will come when she will go to grow, just like her brother.

Now it’s your turn. Go to grow!

Ed Marx is a CIO currently working for a large integrated health system. Ed encourages your interaction through this blog. Add a comment by clicking the link at the bottom of this post. You can also connect with him directly through his profile pages on social networking sites LinkedIn and Facebook and you can follow him via Twitter — user name marxists.

Monday Morning Update 11/29/10

From Bit Byter: “Re: Samsung Galaxy Tab. I’m interested in it.” The new $600 iPad tablet competitor (discounted by carriers selling data plans) runs on Android, has a 7-inch touchscreen (the iPad is 9.7”), two cameras, integrated GPS, Flash support, the cool Swype typing system, Wireless-N, Bluetooth, and seven-hour batteries. It’s too early to say (or buy, probably), but it looks like a reasonable alternative to the iPad for anyone who wants one (just like there are many smart phones better than the iPhone in some ways, but that most people don’t want because they aren’t iPhones).

From Train Wreck in Progress: “Re: CONNECT. ONC can shuffle paper, but they are screwing up real software and progress in treating the CONNECT team like unloved stepchildren despite multiple awards and demonstrated progress in connecting VA, DoD, and Kaiser. It’s a sad day when initiatives like CONNECT are not celebrated, embraced, and supported. Doug Fridsma’s framework was attacked at the HIT standards meetings as not practical, yet he marches on.” The top two CONNECT consultant managers quit as the program stalls while GAO investigates a complaint from Harris, the incumbent contractor, over a new contract awarded to CGI. The open source CONNECT platform, which won WSJ’s technology innovation award for HIT this year, was developed by a group of more than 20 federal agencies to support secure healthcare information exchange among providers, insurers, government, and consumers. ONC standards director Doug Fridsma says ONC wants to make it easier for providers to exchange information directly through NHIN Direct.

From Capiche: “Re: ONC clarification. Any thoughts on hospitals and practices being required to implement all Core and Menu items?” It’s a ONC FAQ that seems to mix vendor and provider requirements in a confusing way, but I’m interpreting it as being applicable only to providers with self-certified, homegrown EHRs. To do that requires implementing all of the Menu set items even though as providers, they could qualify for MU by using a vendor-certified EHR to meet only five of the 10 menu set items. But another interpretation is that all providers must meet all 10 Menu items even though CMS requires reporting only five. Click the above image to enlarge and let me know what you think it means. Or maybe someone from ONC can clarify their clarification since it’s a pretty big deal if that latter interpretation is correct.

Hospitals may lock down their internal e-mail systems with malware protection and tools to prevent PHI transmission, but docs can just go to their Web-based e-mail on those same PCs and do whatever they want, so say 80% of respondents to my poll. New poll to your right, rekindling an old argument — who should be calling themselves “informaticists”? As usual, click the Comments link in the poll to support your position.

Listening: reader-recommended Ry Cooder’s I, Flathead. I haven’t warmed up to all the music yet, but I like that he’s a non-conformist roots music songwriter who doesn’t really care what the masses think. This one’s a third of a three-part concept album series dealing with the Southern California culture in the first half of the 20th century. The alternative to auto-tuned, air-headed, ad-packaged Barbies and Kens singing about lust. And Watching – one more thing I hadn’t thought of that you can do on an iPod Touch: stream your Netflix movies over WiFi, which I did this morning in watching MST3K while brushing my teeth in the bathroom, just because I could.

A five-year study using trigger tools (instead of unreliable self-reported errors) finds that hospitals have made no progress in reducing incidents that cause patient harm. Nearly one in five hospitalized patients were harmed by the care they were given; nearly two-thirds of their injuries should have been prevented; and those injuries contributed to their deaths in 2.4% of the cases. The article concludes that preventing mistakes isn’t rocket science since every hospital knows that they should be doing. The problem is that they aren’t doing those things consistently: handwashing, medication reconciliation, decubitus prevention, etc.

A good article with the great title of The Doctor-Patient-Laptop Relationship looks at how doctors typing into computers changes the doctor-patient dynamic. A past president of the Connecticut State Medical Society says medical schools in her day taught doctors not to see patients from behind a desk since it served as a barrier, but they aren’t teaching today’s medical students ways to keep computers from becoming an equally disruptive barrier. It makes an excellent point: writing makes no sound and people can do it while they’re talking, while keyboarding makes noise and requires most people to look at the keyboard and monitor. I was thinking about that and I agree: when someone’s typing, I usually stop talking because they won’t hear what I say anyway.

Politicians get involved in the plans by two Canadian hospitals outsource IT to Cerner. They don’t like losing local jobs and they also don’t like the fact that Cerner sells de-identified patient data from this side of the border. Meanwhile, the IT department’s “whistleblower” who heard rumors of the discussions and quit in protest says the hospitals are making a mistake in turning over system knowledge to contractors who will have the hospital over a barrel. Anything related to HIT is a touchy subject in Ontario after audits last year found that eHealth Ontario was wildly overpaying no-bid consultants who were filing padded expense accounts, kicking off a political scandal in which heads rolled. The papers are making a big deal about the fact that IT staffers weren’t consulted in advance of the outsourcing discussions, which is ludicrous – in what world does management seek the input of those who would be negatively impacted by one of the two potential courses of action?

Inga interviewed David Delaney MD, CMO of MedAptus, about revenue cycle management tools.

NEJM runs the case study of the Mass General surgeon who performed the wrong surgical procedure on a patient and went public afterward to help prevent errors elsewhere. The Swiss Cheese Effect was in full force, with several potentially minor problems adding up to one big one in which the surgeon performed a carpal tunnel release instead of a trigger-finger release. Contributing factors: (a) the patient did not speak English and the hospital had no interpreter available; (b) the surgeon did several hand cases the same day; (c) the nurse had not marked the planned incision site; (d) the OR suite was changed because other cases were behind; (e) the change in room also involved a changed in staff, including the nurse who did the pre-op assessment; (f) the change in rooms delayed the surgery, so the surgeon saw another patient while waiting; (g) the circulating nurse fell behind in her documentation to go find a missing supply item; (h) the patient’s site marking was washed off when the area was cleaned; (i) the surgeon spoke to the patient in her native Spanish, so the circulating nurse assumed that was the mandatory time-out and didn’t call for one; (j) the nursing team changed mid-procedure; (k) computer monitor placement in the OR forced the nurses to look away from the patient. The best takeaway came from another physician in the case review:

Surgeons need to take ownership of these policies. When the airline industry evaluates a crash, the pilot is not considered responsible except in two circumstances: the pilot was under the influence of drugs or alcohol, or the pilot did not follow protocol. All hospitals need to have a culture in which surgeons feel responsible for making sure the protocol is followed.

Another HIMMS sighting, as even trade show supply companies can’t spell it right.

Funny: Steve Wozniak, the goofball half of the founding team of Apple Steves, mistakenly says in an interview that Apple has acquired speech recognition vendor Nuance, sending that company’s stock on a tear. The Woz says he must have read something wrong.

A court rules that the Iranian government owes McKesson $44 million for illegally seizing its dairy there in the 1979 revolution. The company was Foremost-McKesson back then.

Here’s why you probably don’t want to buy penny stocks of companies more competent at selling shares than product. Shares in would-be HIT vendor Healthmed Services, which I mentioned last week along with pictures of its “headquarters”, go down just as quickly as they’d gone up when pumped earlier in the week. Share price was less than four cents on Monday, up to over 12 cents on Tuesday, now back to under four cents and dropping. Considering the company has zero revenue and prospects for earning any, even the current $7 million valuation is ridiculous. Penny stocks aren’t usually worth even a penny.

IT application coordinators and analysts working for Kaiser Foundation Hospitals get a $2.91 million settlement from Kaiser for being misclassified as salaried instead of hourly. The employees were part of the HealthConnect go-live team, which required uncompensated travel, overtime, and on-call support responsibilities.

In the UK, a hacker gets 18 months in prison for send spam-infected e-mails that allowed him to take control of the PCs of anyone who clicked a link. He bragged on being able to turn on the webcams of infected PCs and to browse their files without the knowledge of their owners. One of his targets was a hospital. About one in 250 of the spam recipients clicked the link. The man is a father of five, runs a computer security firm and did his hacking from his mother’s living room.

The founder of India-based Apollo Hospital Group judges healthcare ideas for a reality TV show about entrepreneurship, choosing Medsynaptic. The Pune company offers imaging solutions, including PACS, low-bandwidth teleradiology, and image workstations.

The South Asia president and CEO of GE Healthcare says the company’s “de-featured” (up to 40% less expensive) medical devices will improve healthcare efficiency, adding that “India will teach the world healthcare innovation.” GE’s healthcare business there is growing 25% a year and they’re planning to hit annual revenue of a billion dollars within five years.

Strange: a UK nurse who accidentally killed a premature baby by giving 50 ml of sodium chloride injection instead of the ordered 5 ml gets in more trouble when the dead baby’s parents find that she posted a Facebook picture of herself asleep beside the baby’s bed a week before the mistake. Afterward, she posted messages asking for friends to “wish her luck” in the inquiry, and when allowed to return to work after her suspension, posted a message saying, “Has had a fantastic day! Is goin 2 treat herself 2 bottle wine!” The hospitals says they knew about the posts.

The Australian government issues $55 million in grants for interoperability projects, or at least that’s what I assume the article is referring to with the term “personal e-health records.” The government is looking for vendor bidders, just in case you’re interested.

A patient sues Halifax Health (FL), claiming his ex-wife, a former hospital employee, provided information from his electronic records to a hearing officer in their divorce and child custody trial. The hospital had already fired her for accessing the records of another plaintiff, which one might assume is hubby’s new love interest.

Nuance will collaborate with Montage Healthcare Solutions to offer radiology users the ability to search their Powerscribe 360 reporting database using voice commands or keystrokes. They’re demoing at RSNA if you want to drop by for a peek.

Surely we can agree this is excessive: the CEO of 128-bed Sturdy Memorial Hospital (MA) is paid $1.18 million per year. You know the excuses: they have to dig deep to prevent her from leaving, the not-for-profit hit its performance targets that enabled it to bank a big surplus, etc.

E-mail me.

The Obligatory but Heartfelt “What I’m Thankful For” Thanksgiving Post

This will be one of those really rare times where I get all reflective and maudlin, it being a holiday and all. I was moved by Inga’s Thanksgiving post. I might have sniffled a little, but I did cook Indian food for dinner, so it could be that the oils from the chili peppers I was chopping for the aloo matar found their way from my fingers to my nose. That’s my story, anyway.

What I’m most thankful for is that I don’t have to think hard to come up with a “what I’m thankful for” list every day of the year. That’s the great thing about having low expectations and a cynical outlook. Any day above ground is a good day.

I love my day job and the hospital that pays me OK for doing it. It’s the best place I’ve ever worked. I’m just as happy when the alarm goes off Monday morning as when it doesn’t on Saturday.

I am thankful for my family and that I found a woman early who not only tolerates my eccentricities and insecurities, but appreciates them. We ought to be sick of each other after all these years, but the first thing Mrs. HIStalk said when she came home tonight, instead of complaining about the paint-peeling stench of my simmering chana masala that she detests, was that I looked sexy. That’s doubtful (especially since I had just sneezed violently from accidentally inhaling sinus-searing masala vapors) but characteristically commendable of her to say. She’s as cute to me as the day we met in college.

I’m happy that I’m healthy, protected by those in military service, and still moved by good music. I’m glad I don’t care much about money, power, and fame since I’d be worrying all the time about losing them even if I managed to get them in the first place.

I’m glad I started writing HIStalk way, way back in the dark ages of 2003. Nobody was reading and I didn’t care, but somehow it has improbably allowed me to meet some pretty amazing people who are trying to make a difference. Sure, and a few douchebags too, but that’s a small minority. We have our differences and our debates in healthcare, but we always end up on good terms.

I’m thankful for everybody who spends their valuable time reading what I write (even the music recommendations, especially the weird ones). I’m grateful that companies support HIStalk just because they appreciate my work and knowing that I’m still going to rag on them when they deserve it.

I appreciate everyone who takes the time to e-mail me, write guest articles, submit thoughtful comments, be interviewed, and tip me off to news and rumors. You make me look smart and your efforts benefit many.

I’m really thankful for whatever cosmic forces sent Inga my way. She keeps me sane and amused, balancing my negativity with cheery optimism and funny e-mails. The insecurity oozed from her early writing as she struggled to keep inside her tiny industry comfort zone. Now she’s confident, insightful, and eagerly read by her many fans (and just as insecure). You’d like her even more if you knew her in person.

I’m thankful that Mrs. HIStalk knows her culinary limits without me having to remind her, so I’ll be doing the cooking Thursday (after popping Zantac all night because the chutney for the samosas was a little too hot). She does make a mean pumpkin pie, though. I’ll just need to crank up the iPod while she’s watching those idiotic televised parades she likes so much.

Have a fabulous Thanksgiving, Black Friday, and the long weekend. And, in my final “what I’m grateful for” item, thanks for reading.

News 11/24/10

ONC invites the public to weigh in on personal health records as long as they do it by December 10.

A just-in report from Canada says that two hospitals there are talking to Cerner about outsourcing IT.

Central DuPage Hospital (IL), a long-time Lawson customer, says it has implemented Lawson Contract Management in less than four months.

Listening: new from My Chemical Romance, high-energy, defiant punk/pop with some nice hooks that provide a needed break from auto-tune singers and phony country warblers. Driving music.

St. Joseph Medical Center (TX) develops a 10-physician hospitalist program with Intercede Health, which includes the use of the company’s Order Optimizer software. It provides SaaS-based diagnosis-specific order sets and order set management tools, medication alerts, physician favorites, and a nine-week implementation time. That product is also available separately from a subsidiary.

In Ontario, Sunnybrook Health Sciences Centre partners with Telus Health Solutions to roll out a consumer health portal / PHR that will allow Telus employees to upload and enter medical information that providers can review. Its underlying technology is Microsoft HealthVault.

Happy birthday to Ed Marx, whose special day was Tuesday. You can post belated best wishes on Facebook.

Jobs on the HIStalk sponsor-only job page: Implementation Consultants and Project Managers, Director of Technical Readiness, Implementation Consultant. On Healthcare IT Jobs: Health Information Technology Support Manager, IS Senior Project Manager, Ambulatory EMR Implementation Specialist.

I received a nice response from AMIA President and CEO Ted Shortliffe about a reader’s question as to whether the organization will decline financial support from vendors who won’t go on record as not using “hold harmless” clauses in their customer contracts. He says AMIA’s vendor contracting task force received redacted contract copies and have no knowledge of how specific vendors are writing contracts. He mentioned that Senator Chuck Grassley had sent letters to vendors asking that very question, but he has not made whatever responses he received public. Ted says AMIA’s role is as an educator, not an enforcer, so it made strong recommendations. I can see that point of view: other than Epic, most vendors aren’t going to walk away from business if the prospect insists on removing clause like that one. Nobody makes customers sign on the line which is dotted.

Speaking of that, I’m amazed that hospitals allow vendors to provide the first draft of a contract, loading it with vendor-friendly boilerplate and making sure to look astonished and hurt at any suggestion from their “partner” that it be changed before they hand over their large check. Job #1 is to create your own contract draft and give it to the vendor as the starting point for negotiation. I’m thinking of starting a telenegotiating service where I whisper electronically in the ear of hospital and practice IT people, telling them what to say and how to use classic negotiating techniques to their advantage. Customers are always complaining about the bad deals they got without accepting blame for taking what was offered without a whimper. In negotiation, 80% of the money on the table is going to be split equally between the two parties. When you’re negotiating, you’re fighting for a bigger share of the remaining 20%.

Investment bank TripleTree will host a Webcast about cloud computing in healthcare on December 1. The panel includes top executives from Castlight Health, SCI Solutions, MedVentive, and Connextions. Two of those four are HIStalk sponsors (SCI and MedVentive), so tune in and support them if you’re so inclined.

Nuance announces Q4 numbers: revenue up 17.7% to $310 million, EPS $0.01 vs. $0.02 after some accounting adjustments. 

British company Cambridge Consultants announces the Minder smart device, which transmits medical data in real time to EMRs. It can also receive checklist information from providers to instruct patients. Technologies used: Bluetooth, Wearable Mobile device hardware, accelerometer, the Continua-compliant Vena platform, and input devices that include a blood pressure cuff and scale.

iSoft’s former auditors face misconduct charges over – what else – allowing questionable recognition practices.

Odd: Healthmed Services, which has staked its fortune on some kind of iPad-to-desktop communication tool for healthcare use, floats a bunch of press releases touting its vaguely described agreements with Facebook and Google. Its also-vague Web site features a video of President Obama and a lot of generic information about the vast healthcare IT market it plans to conquer. The company today announced a development agreement with Veritas Software Systems, which might sound like the big backup system vendor unless you recall that Veritas was acquired by Symantec in 2005 (and its name was actually Veritas Software Corp. – this particular company has no Web presence that I could find). It also announced this week a new Web-based practice management system called HealthTrac, with no details whatsoever. What’s really newsworthy about the company: (a) it just filed an 8-K disclosure that it paid a company $600K to develop its flagship product, armed only with an oral agreement, but that company is holding them up for more money; (b) the company’s stock was being pumped and dumped by cocaine-smuggling New York longshoremen (note this “monster pick” that ran up the price 93% on Monday, with 42 million shares changing hands); and (c) its SEC filings from August indicates that the company had zero revenue, had no expectations of any revenue, and was down to its last $52 in the bank. I Googled its listed address and came up with the Las Vegas building above from Google Maps, which I assume is a mail drop. The address it uses for its SEC filings is a one-person virtual office in California that’s currently for rent for a minimum period of one night (that photo is above, too). The CEO quit in August and the CFO was replaced. Shares are at $0.08, with a market cap of $14 million. Maybe I’ve finally found that HIT vendor who’ll have me on their board, enjoying the corporate headquarters any time I can come up with the daily rent.

Odd: Spirit Airlines refuses to give a surgeon’s pregnant wife water while their overheated plane is sitting on the tarmac, offering instead drinks for sale. He makes a scene and makes vague references to terrorism, his son kicks a flight attendant in the groin, the flight crew kicks the family off, the surgeon is suing for $11 million.

Attachmate acquires Novell for $2.2 billion, if there’s anyone left who cares. A Microsoft subsidiary chips in $450 million to get a bunch of Novell patents, leading to speculation that their interest is either in suing other companies or perhaps porting .NET to Linux.

I think we probably won’t have enough news to be worth posting new issues of HIStalk, HIStalk Practice, and HIStalk Mobile through the holiday, but I’ll have the usual Monday Morning Update. Inga has written a sweet Thanksgiving piece that I’ll run on HIStalk Practice and I may write one myself for HIStalk since we are both sentimental, dreamy-eyed romantics anxious to give our BFF readers a clingy holiday hug, just like the watch-those-hands Uncle Bill on the porch after a little too much spiked eggnog and cheap Thanksgiving wine. We’ve been ultra-busy with new sponsors, interviews, and party planning, so we will enjoy the short break. if you’re headed off to RSNA this weekend, travel safely and make sure to crack up your fellow airline passengers in the security line by loudly delivering a few carefully rehearsed jokes about TSA’s full-body scanners. Have a wonderful Thanksgiving.

E-mail me.

HERtalk by Inga

Fun fact: at Cerner’s on-site cafeteria in  Kansas City, color-coded serving tools prompt employees to notice good food choices. Green handles indicate a great choice (think broccoli), yellow handles suggest you might want to limit your portion (pimento-stuffed olives), and red handles (burgers and fries) mean you might want to make time for a workout after work (that is, if you can sneak out of the parking lot without Neal noticing).

Austin Regional Clinic (TX) implements Webmedx’s Enterprise5 platform for its outsourced transcription and speech recognition services.

CMS will give providers online tracking capabilities to check the status of their Meaningful Use incentive payments. The payment information will be available online once a provider is notified that they have met Meaningful Use requirements.

In an article profiling Epic, the story’s author notes that the company rarely advertises and doesn’t encourage media articles. Apparently the reporter had difficulty getting answers to some basic questions. After several phone and e-mail attempts, she was basically told no one was available to assist. Finally an Epic spokesperson told her that the company’s “managers and leaders were too busy to speak with newspaper reporters, even if the reporter in question was writing a major feature story about them.” I bet lots of companies wish they were that busy.

Meanwhile, another local publication points out that Epic makes financial contributions to over 100 nonprofits. The company also donates older computers to local school districts, supports the local public library, and hosts area high school graduations in its auditorium.

The US Bid Committee announces  that Cerner is now an official partner in efforts to bring the FIFA World Cup to the US in the 2022. The committee chair says that Cerner has “clearly demonstrated” its commitment to the sport “in their innovative web-based health surveillance system for professional soccer players in the United States.” I was aware of the Cerner / Kansas City Wizards connection but didn’t realize Cerner also has an “athlete-focused” solution that was launched earlier this year and is now used by all 16 Major League Soccer teams.

Microsoft’s Peter Neupert says the company is abandoning efforts to make HealthVault profitable because of the complexity of the country’s health system. Neuport told  the Financial Times that HealthValult’s benefit to Microsoft was simply to increase the brand relationship” by raising Microsoft’s image with customers as “important, critical and trusted.” Compare those thoughts to what Neupert had to say at HealthVault’s unveiling three years ago:

The way we make money is by encouraging online activity, and through our search application.We know that search is a big business, it’s an important tool, it’s where consumers are today. And by growing the overall search market and delivering more value to consumers, and delivering a better end-to-end search experience, that’s where we can make our money to support this effort.

Florida doctor Arturo Carvajal sues a restaurant after injuring himself while consuming an artichoke. The doctor claims the restaurant failed to “explain the proper method of consuming an artichoke.” Carvajal, a brain surgeon, ending up eating the entire outside of the vegetable, which caused him "severe abdominal pain and discomfort," ultimately resulting in "disability, disfigurement, mental anguish," and "loss of capacity for the enjoyment of life".  OK, Carvajal really isn’t a brain surgeon, but I thought that sounded funnier than family practice, which is his real specialty. Regardless, I hope he has better luck eating his turkey and that someone advises him not to eat the wishbone.

Sponsor updates:

• NextGen Healthcare partners with Scimage to release a jointly develop the NextGen Medical Image Integration Module. The new module will give NextGen EHR ambulatory users the ability to view images produced by any imaging modality or PACS from within the NextGen EHR.
• Eight MEDSEEK healthcare clients win a total of 14 awards at the Strategic Communications eHealthcare Leadership competition. The program recognizes outstanding health web sites.
• Consulting firm North Highland hires Rebecca Whitehead Munn and Brent Holman as account managers. Munn was formerly the SVP of sales and marketing for Consensus Point. Holman comes from a large for-profit healthcare system (which I assume is HCA since both Munn and Holman are based in Nashville).
• North Sunflower Medical Center (MS) will deploy a suite of McKesson products, including Paragon HIS, Practice Partner EHR, and RelayHealth claims and eligibility  processing solutions.
• Surgical Information Systems says its SIS Version 5 is the first perioperative system to be certified as a modular EHR.

E-mail Inga.

HIStalk Interviews Edward Fotsch MD, CEO, PDR Network (EHR Event)

Edward Fotsch, MD is CEO of PDR Network.

Tell me what PDR Network does.

PDR Network distributes drug safety information, typically FDA-approved drug safety information. The full FDA-approved labels, drug alerts, the new REMS programs, and now increasingly collects drug and device safety information. Our focus is really on the collection and distribution of drug and device safety information, including the appropriate use of drugs and devices.

We publish the PDR, we have PDR.net, PDR Mobile, and a growing suite of services integrated into electronic health records.

Why was EHR Event formed, by whom, and via what process?

We work with a not-for-profit board called the iHealth Alliance. They Alliance is made up of medical society executives, professional liability carriers, and liaison representatives from the FDA. They govern some of the networks that we run, and in exchange for that, help us recruit physicians. Professional liability carriers, for example, promote our services that send drug alerts to doctors because that’s good and protective from a liability standpoint.

In the course of our conversations with them roughly a year ago, when we were talking about adding some drug safety information into electronic health records, we came across the fact that there were concerns from the liability carriers that there was no central place for reporting adverse EHR events or near misses or potential problems or issues with electronic health records. They were interested in creating a single place where they could promote to their insured physicians that they could report adverse EHR events. Then it turned out that medical societies had similar concerns.

Rather than have each of them create a system, the Alliance took on a role of orchestrating all of the interests, including some interest from the FDA and ONC in creating an electronic health record problem reporting system. That’s how it came into play.

Our role in it, in addition to having a seat on the iHealth Alliance board, was really in network operations — in running the servers, if you will, which didn’t seem like a very complicated task. Since business partners we rely on for our core business were interested in it, it was easy to say yes. It frankly turned out to be somewhat more complicated than we originally thought, but now it’s up and available.

What is the relationship with FDA, AHRQ, ONC, and some of the existing tools, such as the MAUDE database?

AHRQ has a thing they call the Common Format, which is a common set of questions for reporting patient safety-related events. They try to promote the use of their common format so that there can be some standardization of patient safety across multiple different reporters or reporting systems. We incorporated the AHRQ common format.

The role of the FDA is pretty much what is expressed in the press release, which is that they’re very supportive. They’re interested in seeing information about EHRs and issues associated with EHRs.

The exact relationship with the FDA and electronic health records, at least from my reading of the press, isn’t clear. Our goal is not necessarily to clarify that or be a spokesperson for the FDA, but we appreciate their support and their promoting the idea of reporting of electronic health record vendors participating in EHR Event.

They currently have some voluntary reporting associated with EHRs, but it is far from ubiquitous. At least based on my understanding of it, it’s more focused on inpatient systems, where EHR Event pretty much looks at inpatient or outpatient systems. One of those areas of perceived growth is in in the outpatient — the typical doc practice.

I’ve now exhausted my knowledge of what’s going on inside the FDA, but we certainly appreciate their support.

I think that Dr. Blumenthal and ONC did a great job of explaining their position. I think any network or new system that’s being rolled out appropriately has some kind of feedback loop, so they were quite supportive. I don’t know if you know if any kind of adverse reporting is going to be a part of Meaningful Use requirements, but if it is, it would certainly make sense. EHRs have great potential. It’s not just because they turn paper into electronic format, but they represent a communications platform to US providers.

To the extent that the federal agencies that either have systems in place or algorithms in place like AHRQ are generally supportive of the effort. This is sort of a “more the merrier” kind of thing.

Assuming ONC doesn’t mandate the use of reporting and FDA hasn’t had much luck in getting people to report into its database, how will it be different with EHR Event?

To my knowledge, the FDA hasn’t had any outreach at all to providers — docs like me. If they made the call, I missed the message. I don’t know how they’ve gone about other reporting initiatives. I certainly know what they’ve done with device and drugs and MedWatch and that kind of thing. From my standpoint, it’s comparing something that doesn’t exist.

I think the reason we got reports rolling in the door within 24 hours, frankly, is because of the relationship that exists between the liability carriers or medical societies and their insured or their members. Actually someone had called and said, “Why isn’t the FDA doing this?” I assume what they were saying is,  “Why hasn’t the FDA created an EHR adverse event reporting system.”

There’s probably a lot of political reasons. I don’t work for the FDA and I wouldn’t speak for them, but I have had a medical license in the US for the better part of three decades and I would say that for any federal agency to take any action is not always a quick process. I don’t know all the steps, but I imagine there would be public notice and this and that, perhaps some politics involved. I’m not an expert. I don’t work for the federal government and I suspect I never will.

There’s also the reality that most physicians, I think, if you ask them, would indicate that they would be more comfortable with a system that is operated largely by their professional liability carriers and their medical societies with whom they have great trust and a longstanding relationship.

Do you think those insurers and medical societies will mandate, to some extent, reporting of errors to back their members?

I don’t think that a medical society has any authority to mandate anything of members. Again, I don’t work for them and wouldn’t speak for them, but how would they do that? Docs practice medicine based on state licensure. I supposed you could talk to the state medical boards, but I think that’s a long slog.

The other problem, of course, is that even if someone mandated that you reported EHR events, how would you actually enforce that? How would you know that they did it?

I don’t look at this so much as a mandate. I look at this as liability carriers are in the business and regularly reach out to their insured doctors saying, “These are the kinds of activities that we suggest you do and these are the kinds of activities that we suggest you avoid.” Having written checks for hundreds of thousands of dollars to professional liability carriers in my years of practice, I can tell you that you know that the only goal they have is to improve patient safety and protect your liability.

I think mandate is probably not the right word. I think educate and encourage and promote are the kinds of things that medical societies and liability carriers are doing and will continue to do.

FDA is supportive and interested, but not to the point they did it themselves, which would seem to be something they would have done if they were all that interested. Is there a plan to share the information that’s collected in EHR Event with FDA?

I guess the premise of your question I’m not in agreement with, which is that if the FDA were interested, they’d do it. I’m sure the FDA has a lot of things they’re interested in. Whether they do it or not probably has to do with budgets and politics and the reality of what it would take to actually get something going.

Again, I’m not an expert in government process, but I’ve been around long enough to know that the federal government doesn’t turn on a dime. The FDA has to follow the rules of the federal government, which has a fair amount of process around it, at least as far as I understand.

But to your question about the FDA learning and getting smarter from the EHR Event reporting system, as a federally designated PSO, there’s some contractual requirements for any third party — whether they be federal, private, not-for-profit — to get reports from the PSO. I assume that the FDA, based on our discussions with them, will enter into an agreement that’s dictated by AHRQ for access to the kinds of reports that will come out of EHR Event, as will liability carriers, as will medical societies, as will regional extension centers.

The big parties that you didn’t name are the vendors of the systems that are having errors reported about them. What involvement have they had or will they have?

They have the option of participating, which means they sign an agreement with the PSO and reports that are pursuant to their system are routed directly to them. But they certainly don’t have to do that. Everyone who participates in this is doing it on a voluntary basis.

So far, the response has been very favorable. I saw the quote in the press release from the e-MDs folks. But I think all of them understand that the systems aren’t perfect.

Probably what we’re seeing more often than not, the real challenge with EHRs like any technology, turns out to be some form of user error. “I didn’t know it would do that,” or “I didn’t know that it pre-populated that,” or “I didn’t know I shouldn’t cut and paste,” or “I wasn’t paying attention to this,” or maybe the user interface was a little confusing. Actual software errors appear to be the exception rather than the rule as it relates to EHR events. That’s at least as I understand it. I don’t get to see the reports because I don’t have that right within the PSO structure.

Anecdotally, from hearing the kinds of issues that liability carriers had talked about that they had seen, and hearing it from the high level of reports that have been coming in, they’re actually more frequent that you have a learning curve type issue, which is I think anticipated and the point of the exercise, which is most liability carriers promote electronic health record adoption, but although they promote it, they also know that these are new systems and new workflows and there’s a learning curve. The interest is in getting as much information as quickly as possible.

Is this is a business? Is there a revenue stream? Does PDR Network make money from this service?

I wish I could say yes, but the truth of the matter is that it’s more or less pro bono work that we’re doing on behalf of partners whose relationship is important to us. There’s other types of adverse event reporting that we’ll be rolling out over the next year that you can actually make money from. We certainly aren’t smart enough to figure out how to make any money off EHR event reporting.

Fortunately, because we are in the business of collecting and disseminating information and run networks and servers and integrate with EHRs and do all that stuff anyway, it’s not a heavy burden for us. But it is not a revenue center. I’m reasonably good at figuring out how to make money, but I haven’t cracked the code on this one.

If I’m a provider, what’s the benefit to me to submitting a problem report?

I guess the same as if it was an adverse drug reaction. Sometimes I have to say that just knowing docs, sometimes it’s sort of being a doc, right? You raise your hand when you see a problem. You certainly don’t make any money for doing it and not everyone will report every problem, but it’s amazing how frequently docs do the right thing even though they’re not getting paid to do it.

I think in this case, there’s probably a general feeling, at least among the target audience, that if nobody says anything about a problem, the problem never gets fixed. The analogy that I would make is that there are 500,000 adverse drug events reported into MedWatch every year, and to my knowledge, nobody makes a cent from reporting them, but they report them anyway. My view is this what docs do. They often do the right thing even though they’re not necessarily getting paid or otherwise not getting some benefit for it.

If I’m a doc and submit my incident, what happens next? How does that help fix the problem?

It goes in the PSO. Those who have the right to do that, which are only a handful of people, will create reports. Other physicians will know that inpatient hospital systems are having these kinds of problems or those kinds of problems, or maybe there’s a software problem, although again more often than not, it seems to be user error type things. The reports will go to groups like professional liability carriers.

I don’t know what the FDA would do. I assume they’re going to access PSO reports because they’ve indicated that they plan to, but the liability carriers and the medical societies and regional extension centers will turn the reports into education programs. There’s an effort to create CME programs that the liability carriers will promote to docs, the specific CME program for docs who want to adopt electronic health records. Oftentimes those programs from liability carriers are tied to patient safety credits that actually reduce liability carrier premiums. But most of the focus is educational.

As for the reporting physician, they’ll get a response back, “Thank you for the report.” If they wish, they can enroll in a monthly update newsletter sort of a thing that will be an extract of the PSO reports — here’s how many patient safety-related reports we got this month, here’s some high-level stuff — although PDR Network, at this point, isn’t planning on creating any CME programs from this. But we know that some of our partners are and we’ll probably help distribute links to the CME programs.

With the FDA’s drug reporting system, there would be capability to immediately trigger some sort of a black box warning or recall. If I’m a provider submitting to this database, do I have any assurance that other providers using the same system, if it’s a system problem, will find out what I reported or that I’ll find out what they reported?

There’s a number of pieces to that. First of all, if you’re familiar with the MedWatch system, it’s quite a bit more complicated than what you described. There’s not really lightning-fast turnaround from MedWatch reports. Black box warnings have to go through an entire process before they come out. Some of them may be triggered by MedWatch, oftentimes not. Often it’s based on post-market studies or some other piece.

Secondly, 95% of of MedWatch reports don’t come from providers directly. They come from the manufacturers. Out of 500,000 that the FDA gets, only 5%, one in 20, are directly reported to the FDA. Most of them go to the manufacturers, who bear the responsibility for chasing down the information and getting all the facts and details. The FDA is certainly not staffed to do all that legwork and the manufacturers have a regulatory requirement to do that.

That kind of infrastructure is not in place for EHRs, or least that I’m aware of. Perhaps it will be someday. I don’t really know what the regulatory environment is going to be for EHRs.

If I have a problem with an EHR and I report it, there’s two pieces to it. One is that my vendor has a responsibility, if it’s a problem with their system, to correct or improve the systems and notify other people of the problem. If they didn’t have a regulatory reason to do that, they’d certainly have a liability reason to do that. We will route those reports dutifully, but we’re not a regulatory agency and we’re not attorneys.

What we can do is get the reports and get them into the hands of groups like liability carriers, medical societies, and regional extension centers and then let them reach out their physicians and educate them. If it turns out that it’s a specific software problem, most of the burden for that will fall on the vendor.

I’m sure that will come up more frequently as an education issue, so how do you educate docs? Part of that is the vendor’s responsibility, part of it’s the liability carrier’s responsibility, part is the regional extension center. That’s why they get, whatever it is, a third of a billion dollars to educate docs about electronic health records.

From the standpoint of who bears the responsibility of acting on a software problem, that will largely be the EHR vendor. They have that responsibility now. Hopefully we can add to the flow and speed of information to them.

Anything else?

Most of folks who’ve called, whether they be press or … we’ve heard a little bit of, “This is overdue.” [laughs] I’m sort of like, “OK, now here it is. Sorry we were too slow.”

I’ve heard a fair number of people say, “The federal government should be doing this” without much knowledge of what it would take for the FDA or some other agency to create a system. There was a real concern, frankly, among the liability carriers that any involvement by the federal government might actually reduce the amount of reporting that occurred. I certainly heard it. It resonated with me as a doc. It’s one thing to report something to my liability carrier or medical society, but as soon as you get the federal government involved, someone’s going to say, “I’m less likely to report that because I just don’t want to deal with it.” 

I think there are challenges associated with it. I think this is a point along the way on education related to EHRs. It’s not a regulatory effort. The federal government is going to do or not do whatever they’re going to do. This is some federal government support and cheerleading and participation, but this is not a mandate from the federal government. Whether that will ever occur or not I really don’t know.

Monday Morning Update 11/22/10

From SpaghettiCode: “Re: GE. The recent reorganization confirms that they made a huge mistake with the $1 billion IDX acquisition. After many attempts to defibrillate the CareCast business, they finally orged the legacy business under the EMR side and key execs were moved out.” Here are snips of what I had to say about the acquisition in September 2005. I mentioned collaboration with Intermountain Healthcare as a positive (that’s gone nowhere that I’ve seen), although I was focused mostly on the inpatient apps:

If you’re an optimist, you might assume that a mega-conglomerate like GE will pump R&D into the old warhorse IDX products, make them wonderful in a way that a small player like IDX never could … Pessimists would ask for even one example where that has ever happened, including with prior GE acquisitions … Much of CareCast was written 20 years ago by that little band of Phamis employees in Seattle. Does it contain enough intellectual property or technical excellence such that a quick spit-and-polish treatment will make it a world-beater? I don’t think so, but maybe GE does … Conglomerates have a way of screwing up products (McKesson, Siemens, and maybe even Misys.)… IDX needed a white knight. It was devaluing itself day by day, with an embarrassing UK performance and no CareCast sales. The acquisition announcement mentioned that IDX needed a partner with global reach, but it had already created its own opportunity in the UK and blew it. Cerner and Epic were threatening to run the table on them … Somehow HIT companies seem to lose their passion when swallowed up by multinational firms selling everything from light bulbs to Jay Leno. That’s kind of sad, don’t you think?

From Boston Patient Advocate: “Backlash is building by patient advocates against self-appointed ePatients who make a living selling a modified version of their story. They often fail to mention that they misunderstood information they found online, weren’t really as sick as they thought, or that it was their doctors that found the correct treatment or gave them an RX for online communities. Then again, we love myths of the little guy in America.” I ignore news stories in which reporters try to mask their opinionated reporting with phrases such as "debate rages”, “some are questioning”, or “pressure is building”. In other words, I don’t doubt your sincerity, but I’d like to know specifics behind your “backlash is building” assertion. As we say in the medical world, “In God we trust … others bring your data.”

From The PACS Designer: “Re: Continuity of Care. TPD is happy to see that HHS has embraced the concept of Continuity of Care as it is laid out in the ASTM Continuity of Care Record (CCR) and requires providers to include it in their EHR certification submission request. Healthcare organizations will have to include the ASTM CCR in their discharge process to get their EHR certified, and at the same time, we’ll have a chance to transfer information between providers to help eliminate duplication of procedures and reduce medical errors.”

Eastern Maine Medical Center (ME), preparing for a three-day lockout of striking RNs by bringing in replacements, will shut down all of its clinical systems except the eMAR and go back to paper. Here’s a hint for those living near Bangor: go somewhere else if you’re sick this weekend. Or, if you’re one of those “EMRs are evil” naysayers, this is your rare chance to do some Maine-based medical tourism to receive critical, elective medical care at a paper-based hospital.

The usual list of stuff you can and should do here: (a) subscribe to the updates so you aren’t embarrassed by the idiot three offices down who learns breaking news before you and rubs your nose in it; (b) use the search function to amplify your HIT intelligence in real time; (c) Friend or Like us on Facebook or connect with us on LinkedIn so that we may both pretend to be more popular than we probably are in real life; (d) click some of the sponsor ads to your left to see what they’re up to; (e) visit HIStalk Practice and HIStalk Mobile to get mostly different news particular to physician practices and mobile health, respectively (and sign up for those updates, too, if you want to stay on top of stuff).

Listening: the remastered 1978 debut solo album of former Pink Floyd leader David Gilmour, recommended by a reader. I appreciate that: I really like his music and respect him for his charity work, but I never think to recommend his solo stuff, which at that early stage of his career was kind of Pink Floyd Lite (not necessarily a bad thing). He’s supposed to be reuniting with former bandmate Roger Waters at one live performance of The Wall, which is on tour now.

Forbes runs maybe the weirdest, worst HIT article I’ve seen, apparently intended to be a cheerleading piece for Allscripts. It claims that open source is about to make its healthcare debut, courtesy of Allscripts (meaning Allscripts Helios, previously Eclipsys ObjectsPlus, which has been around since the 1990s). It claims that many tech vendors have gone out of business because they “chose to cling to closed, proprietary software or hardware” (care to share names and proof of the cause of their demise?) It mumbles something about the need to interface a “computerized drug order system” to an EHR (huh?) It says Judy Faulkner’s statement that you can’t mix and match vendors is an Allscripts advantage, failing to notice that Judy’s company (whose industry-leading product is closed and proprietary) had pretty much killed Allscripts (nee Eclipsys) Sunrise single-handedly since to install Sunrise, unlike Epic, required mixing and matching vendors to cover the many hospital areas it doesn’t address. To top it off, the article uses the old Allscripts logo pulled from Wikipedia instead of actually checking their site directly to get the current one. All of this was a lame attempt to create an interesting, insightful article around an October press release in which Allscripts announced that it would create an apps store for the former Eclipsys Sunrise, which has nothing to do with open source in the first place since nobody’s seeing and contributing to anybody else’s source code (extensibility isn’t the same as open source). It’s just amazing to me how many people write authoritatively but wildly inaccurately about healthcare IT (usually spinning entire articles around press releases and a couple of Google searches) who have never worked a day in either healthcare or IT except as a cheap-seats spectator. Caveat lector.

A little more than half of respondents to my poll say they’ve seen “hold harmless” contract clauses, although I liked the excellent comment by NotQuite, who pointed out that a “hold harmless” clause is not the same as a “limit of liability” clause. I’m no lawyer, but that sounds legally insightful. Gotham City CIO requested the new poll to your right, for hospital people: does your organization block access to outside e-mail services by physicians using hospital PCs? They block access to Gmail, Hotmail, etc. at his place to prevent the possible transmission of PHI via untrackable e-mail services, which is apparently common in other industries. The new CEO is getting heat from the docs even though they can still use a dedicated PC in the doctors’ lounge or their own PDAs to get to those services. Feel free to add any comments to the poll that would help our CIO colleague.

Thanks to new HIStalk Platinum Sponsor Orion Health. The international company, based in Auckland, NZ and with US offices in Santa Monica and Boston, offers solutions that include an HIE platform, the Concerto Physician Portal with single sign-on to provide a single patient view across multiple clinical systems, the Rhapsody Integration Engine for inter-system messaging and integration, the Rhapsody Connect solution for connecting to public health agencies, and the Symphonia developers’ messaging system for rapid system integration. The company just reported an 80% increase in revenue for the first half of the year and has 22 HIE sites in 12 countries. In the US, Orion’s HIE solution was recently chosen by the Wayne State University Physician Group and Maine’s state HIE. Rhapsody 4 just came out with new support for SOA integration and Web services, with Philips choosing it as its integration tool. The company offers a much broader product line than I knew about (EHRs, registries, whiteboards, bed management, chart deficiency, etc.) so feel free to cruise over to their site to learn more. Thanks to Orion Health for supporting HIStalk.

McKesson’s Horizon Clinicals earns ONC-ATCB certification through Drummond Group.

Marty Mercer is putting together a HIT sales training class for newbies and is looking for input from industry long-timers. You can help out by completing his short survey like I did. He’ll send me the results afterward since I think they might be fun to review here.

Inga emulates Weird News Andy with this link: doctors warn of the psychological dangers of social networking after an 18-year-old boy’s asthma attacks are found to be triggered by looking at the Facebook profile of his former girlfriend. His mom measured his peak expiratory flow before and after.

The Rural Nebraska Healthcare Network starts construction of its Nebraska panhandle fiber optic network that will connect nine rural hospitals and their clinics.

Vendors beware: patent troll Acacia Research buys 11 patents for wireless physiologic monitoring. Let the nuisance lawsuits begin.

A company that has developed an electronic parking space finder wins at the IBM SmartCamp World Finals in Dublin, but a couple of HIT-related companies were in the hunt: CareCloud (Web-based practice management and revenue cycle tools for practices) and Sproxil (checks the authenticity of drug products via SMS messaging, primarily in developing countries).

Speaking of “cloud”, everybody’s hopping on that bandwagon with as much self-serving enthusiasm as they did previous sloppily defined fad terms (ASP, EHR, clinical transformation). Since HIStalk runs from a Web host, I think I should start referring to myself as a “the leading cloud-based business intelligence and collaboration platform for the healthcare technology and life sciences sectors.” I’m thinking investors will line up at my door dripping saliva at the chance to throw money at me. 

St. Paul Heart Clinic (MN) closes its doors, with its 36 cardiologists going to work for either Allina or HealthEast. A key reason, as explained to patients, was the ability to share a common EMR.

Orlando Health (FL) offers local medical practices a discount on GE Centricity.

Weird News Andy likes this story: the call center for TennCare is a women’s prison, as discovered and reported by the overly dramatic and pot-stirring local TV station anxious to use that “breaking exclusive” graphic typically rolled out when someone’s flat tire backs up traffic almost a quarter mile. WNA likes the eloquently expressed consternation of one Leon Rippy, apparently goaded randomly by the TV station to weigh in on the issue of the potential but entirely theoretical impact on patient privacy: “That ain’t good.”

Coliseum Hospital (GA) investigates a former employee who dropped by to attend a nurse’s birthday party, then logged into the hospital’s computer system with her still-active password and looked at patient information. She’s caught by hospital security, which was apparently more effective than IT security considering the terminated employee’s credentials had not been inactivated. Assuming HR let them IT, of course (and trusting the competency of any hospital’s HR department is indeed foolhardy).

A blog entry in The Economist says HITECH could be as big a bust as NPfIT in the UK, suggesting that France provides a better model:

Maybe the Americans (and the British) should swallow what the French would term their “Anglo-Saxon” arrogance, and look at France. A French citizen presents his credit-card sized Carte Vitale to the doctor or the pharmacist or the hospital and everything—for example, the date and dosage of a prescription—is recorded by a national computer system (which also usually deals with payments). Visit another pharmacy or doctor in another town, and the patient’s details are automatically available. Perhaps this helps to explain why the World Health Organisation in 2000 (the last time it did the exercise) put France at the top of its rankings for health care. By contrast, Britain came 18th and America 37th. Mind you, it may also explain why the French pop more pills than anyone other than the Japanese.

E-mail me.

Being John Glaser 11/10/10

Meaningfully Using Industry Buzzwords at Home

With the HITECH and ACA legislation and rules. many new phrases and words have been introduced and old ones have gained additional prominence. I have found that these phrases and words also have use in several situations at home. See some examples below.

Death Panel. Your sixteen-year-old son returns home drunk at 2 a.m. after a long Saturday night. He parks the car sideways on the lawn. You and your wife are sitting on the couch in the living room waiting for him. As far as he is concerned, you and your wife are a death panel.

Stimulus funds. Your spouse shows you the new clothes that she bought. You like the clothes, but are mystified by the apparent need for new clothes when the old clothes aren’t that old and you liked those too. Moreover, the clip-on tie you had in third grade is still good and forty years later you still wear it from time to time. You don’t realize that the household income is really a stimulus fund to keep retailers employed.

Data exchange and interoperability. Your daughter (a senior in high school) wants to spend the weekend with her new boyfriend, who is a freshman at a local college. You, recalling quite well what’s always on the minds of young males, say “No.” Your daughter protests, “But Dad, it’s not what you think. I will be staying at his cousin’s (who is a girl) dorm room. Nothing will happen!” You think – I don’t believe that for a second – and again say “No.” You and your daughter are engaged in data exchange, but there is no interoperability going on.

Certification process. The first time you met him, you instantly liked your daughter’s new boyfriend. The second time you met him, you engaged him a lengthier conversation and discovered that he is a moron. The third time you met him, he had been invited for dinner and was clearly stumped by the role of the napkin. You decide that you and your daughter need a new boyfriend certification process.

Meaningful Use. You notice a dead tree in the yard. You find your chain saw and install a new chain. You assure your wife that you know how to fell this tree so that it won’t hit the house even though the tree is close to the house. You miscalculate and tree branches take out the kitchen window. Your spouse is less than impressed. You are clearly not a Meaningful User of advanced technology.

Bundled Payment. You are arm-wrestling with a new car salesman over the price of a car. He mentions all of the features that come with the base price – seats, steering wheel, front window, headlights, and an engine. He informs you of all of the extras – roof, glove compartment, and radio. You want the extras for free. Plus you want a sun roof, Jacuzzi, and toaster. You and he are negotiating a bundled payment.

The great thing about words and phrases is that they have so many uses and meanings.

John Glaser, PhD, FCHIME is CEO, Health Services of Siemens Healthcare. He describes himself as an "irregular regular contributor" to HIStalk.

News 11/19/10

From Karen: “Re: Meaningful Use: Doctors Have No Choice. Written by my husband, but still true!” Jim O’Connor, MD of MDcohort makes the argument that Meaningful Use isn’t as voluntary as it sounds, offering as evidence: (a) CMS will start imposing penalties on EMR non-users in 2015; (b) private insurers will tie MU to their P4P programs; (c) MU will apparently be made a requirement for renewal of board certification; (d) states can impose their own penalties, possibly even requiring MU for medical license renewal.

Ed Marx has a lot of fans here, so if you want to read more from him, he has posted a special article about his relationship with his daughter on Texas Health Moms, a site managed by his employer, Texas Health Resources.

Listening: new from Guster, which I’ve mentioned before. Solid, harmony-driven alt-pop (kind of R.E.M.-y to me), but they’re also funny: they enlist fans to sell CDs and sometimes open their own shows in disguise. If you’ve heard any of their stuff, it was probably Satellite.

Timing is everything: just after Aurora Health Care (WI) announces plans to eliminate 175 jobs in a cost-cutting effort, the press gets wind of the $8.2 million its former COO was paid upon his retirement last year. They make the standard excuses (accrued benefits, they have to compete with for-profits anxious to hire away executives who have spent their entire lives in healthcare, etc.) but I note that they paid the CIO $739K and the CEO got over $2 million according to their most recent tax filings. They have 30,000 employees, so maybe that seems reasonable by inflated non-profit salary standards these days. We may suck at population health in this country, but we lead the world in the executive-to-grunt compensation ratio.

The Aurora guy, who wasn’t even the CEO, made even more than Cerner CEO Neal Patterson, who took home $3.3 million in 2009, a little less than he made in both 2007 and 2008. And speaking of Neal, I’m clearly not at his level of business acumen because this just seems weird: he and Cliff have renamed their soccer team from the Kansas City Wizards to Sporting Kansas City. They’re doing some kind of membership thing, apparently, but that name sure make a weird fan cheer.

Think this will reduce healthcare costs? Mayo Clinic is building proton-beam cancer treatment centers at its Minnesota and Arizona locations. The price tag: $370 million.

On the sponsor-only HIStalk Jobs Page: Director Technical Readiness, Implementation Consultants and Project Managers, Healthcare Consulting Leader, Account Executive. On Healthcare IT Jobs: Program Manager IT Implementation, HED AdminRX HArx Remote, Implementation Engineer – Integration, Epic Inpatient Opportunities.

A New York Times article describes the problems San Francisco Department of Public Health is having with its $11.2 million Avatar EMR from Netsmart. Conversion problems caused delays in Medi-Cal payments to individual therapists and some therapists and social workers are complaining that using the software is eating into time for patient care. A post-implementation audit showed that mental health services volume dropped by 55% and substance abuse by 32%, with the deputy financial officer concluding that, “It’s pretty clear none are getting Avatar.” A social worker agreed: “This is not the job we accepted when we chose to do clinical work for the city.”

Strange: a Walmart pharmacist is disciplined by the Maine regulatory board for dispensing zolpidem instead of Zoloft to a patient. Before his own drugstore went bankrupt, he was also found to have overbilled the state by $1.6 million. The odd part: he’s a state representative in line to become the next speaker of the House.

The VA will develop two prototypes of Aviva, a virtual implementation of its VistA system and its apparent replacement, according to its just-released Fiscal Year 2010 Performance and Accountability Report. I thought they already had demonstrated the prototype earlier this year, but maybe this is something new.

Verizon will offer free credentials to providers in starting in January that will allow access to its Verizon Medical Data Exchange. It offers a provider portal, a secure inbox, and connections to the Verizon Health Information Exchange.

E-mail me.

HERtalk by Inga

From MrSoul: “Re: Kindle It. Encourage your readers to tell the publisher of Connected for Health to publish in Kindle so we can read it on our iDevices! There is a link on Amazon to do just that and then they can have this great resource always on hand.” I would think a book like this would already be in digital format!

West Penn Allegheny Health System selects athenahealth’s RCM service for its 600-doctor physician organization. They are apparently replacing GE’s RCM product. On the EHR side, they use Allscripts.

Venture capital firm OpenView Partners makes a minority investment in Prognosis Health Information Systems. Prognosis CEO Ramsey Evans says that OpenView’s investment will allow the company to “move forward and take our business to the next level.”

North York General Hospital in Toronto goes live with 300 order sets, using tools from Zynx Health’s ZynxOrder and integrating them into Cerner EHR.

CMS says the error rate for Medicare fee-for-service claims in 2010 dropped to 10.5%, or $34.3 billion in estimated improper claims payment. That’s down from 2009’s $35.4 billion in payment errors. I guess we should all be thrilled that CMS is getting better, but I am stuck thinking about all the better ways that $34.3 billion could have been spent.

The Stone Center of New Jersey IPA signs a 15-month contract with iMedicor to connect its 120 urologists into iMedicor’s National Health Communications Network.

Central Maine Healthcare eliminates 20 jobs as a result of outsourcing its medical transcription to Precyse Solutions. Precsyse offered positions to all 20 employees, though only 10 accepted. The move to outsourced transcription is part of a $11 million cost-cutting initiative.

Health management company Continuum Health Alliance contracts with Ignis Systems to provide integrated lab orders management for its EMR application services.

The Indian Health Service (IHS) commits to a $3.3 million contract with Orchestrate Healthcare and Vangent to plan, implement, and support the national deployment of the IHS HIE, enterprise MPI, and NHIN capability. Vangent’s HIEOS open source software will be used to establish connectivity between IHS facilities and the NHIN.

Miami-Dade County Commissions tell Jackson Health System to cut ties with the company handling its international marketing after a recent report details excess spending for such things as flowers and birthday cakes ($7,000), local meals ($37,000), and limo rides ($12,000).  An additional $6,000 was spent on a Royal Caribbean cruise for five of the marketing firm’s senior executives and their families. Foundation Health Services was the organization handling the health system’s international marketing efforts. It’s a not-for-profit, so I guess the execs had to get their perks from somewhere.

Teleradiology service provider Century Digitec Services goes live on eRAD’s hosted teleradiology software platform.

A study of 15 IDNs leads the Government Accountability Office to declare that EHRs can improve the quality of healthcare, making patient information more readily available and improving communication and coordination between providers. Providers still face challenges in terms of maximizing their use of EHRs, including limitations on sharing patient records outside their health system.

New on HIStalk Practice this week: 15 HIT vendor execs share what their company is doing to help physicians qualify for Meaningful Use. Evan Steele of SRSsoft provides commentary on the Meaningful Use challenges for specialists. Fun details on the eClinicalWorks national user conference, including a party pic with a uniquely attired CEO Garish Navani. And, the EHRevent patient safety reporting system. There’s a bunch of other good stuff as well, none of which you will find on HIStalk. Make sure you remain smarter than your co-workers and take a read.

"But Inga,” you say. “I’m too busy, just give me the highlights.” For grins and because I believe it’s important stuff, here’s a short summary of what the HIT vendor execs had to say about helping providers reach Meaningful Use:

• Several are incorporating dashboard tools or similar reports to help providers assess EHR usage based on Meaningful Use requirements.
• Most are offering webinars; many are setting up regional meetings to educate users on what needs to be done; most have online tools available; and, most mention the option for personal assistance, either on-site or remotely.
• Only a couple mentioned working with regional extension centers to share expertise and help beef up local infrastructures.
• Allscripts and athenahealth remind users that they offer Meaningful Use guarantees.
• Not surprisingly, some of the vendors have nicely packaged answers, which to me suggests (a) the vendor has established a clear-cut plan,  or, (b) the vendor has a great marketing department, or (c) both.
• A couple are short on specifics and don’t say much more than vendors needs to help physicians in the process.
• Jonathan Bush of athenahealth wins the prize for the most entertaining answer.
• Evan Steele of SRSsoft  has the most unusual reply, saying the company has spent considerable time reviewing the requirements and are helping its clients make an informed decision as to whether participation is right for the individual practice.

Sponsor Updates

• Encore Health Resources had a contest to see who could do something creative with 100 Legos in celebrating the hiring of the company’s 100th employee. Above is one of the submissions by employee Paul Murphy, who went with a multimedia strategy with an Ivo bobble head approach. I was thinking that I could have cheated and added extra Legos and come up with something spectacular.
• Nuance Communications introduces Nuance Transcription Services, which combines the eScription speech recognition platform with medical transcription and editing services from two of Nuance’s newly acquired companies, Outsource Solutions and Encompass Medical Transcription.
• MEDecision earns NCQA HEDIS software certification for its Alineo Clinical Intelligence Rules 2.4.0 and 2.5.0 programs.
• CareTech Solutions launches CareWorks 4.0, which includes enhancements in audit reporting, directory utilities, and several mobile modules.
• Fast-growing EnovateIT will move its headquarters from Ferndale, MI to Canton. The company’s mobile and wall-mounted computer workstations are used a third of the hospitals in he US, with last years $19 million in sales expected to reach $35 million this year.
• dbMotion appoints Prematics president and CEO Keving Hutchinson to its board of directors.
• 3M Health Information Systems and IQMax partner to offer 3M’s coding and documentation tools using IQMax’s mobile healthcare platform.
• Hayes Management Consulting will provide its Legacy Application IT Help Desk services to Moses Cone Health System as they transition from GE Centricity Enterprise to Epic.
• South Australia’s Public Health System names Allscripts its vendor of choice to provide EHR to its 80 hospitals. The agreement to purchase Sunrise Enterprise 5.5 is subject to contract negotiations, with final approval expected during the first half of 2011.
• Sage is named a group purchasing EHR vendor by PA REACH, which will offer Sage Intergy Meaningful Use edition to providers at a discount.
• A new KLAS report on ED solutions names Epic and Wellsoft as tying for the top spot.

E-mail Inga.

HIStalk Interviews Jonathan Phillips

Jon Phillips is founder and managing director of Healthcare Growth Partners.

Explain what you do. I don’t really understand it except I figure it’s lucrative.

We are an investment bank focused on healthcare technology and services. What we do is analogous to being a real estate agent for companies where we help companies sell themselves, or we help companies buy other companies.

So a good bellwether of how busy that market is would be how often your phone rings. Are you finding that it’s a lot busier now than it was?

What’s interesting is that it is a lot busier now, although the best bellwether is still the number of deals that actually get done. One thing that’s just a fact of life in the mergers and acquisitions business is that when you start a process, you don’t always finish it.

What you see are a lot of situations where companies decide to sell themselves and they don’t get a buyer for reason A, B, or C. It could be that the price that the market thinks that they’re worth isn’t what they think they’re worth and so they decide to wait. Or, it could be that they just don’t get interest at all. Or, it could be that they decide they’d rather do something different — that maybe they’d rather raise money instead of selling themselves, go buy something.

The key challenge in terms of this business is getting things to the finish line. What you’re seeing in the market as a whole is a significant uptick in terms of the number of transactions getting done as compared to a year ago or two years ago, both in terms of the number of deals and the value of those deals.

Where we sit right now is that there are more deals trying to get done than deals that have gotten done, and so you have a lot of folks who haven’t been able to get things done and there’s some interesting dynamics that go along with that.

Do you think it’s because companies that are trying to sell are seeing a top in the market and figure, “Hey, now’s my chance, although I’ll keep going if it doesn’t work out” or do you think they’re desperate, like, “I’ve got to do it now or it’s never going to happen?”

Early in the year, a lot of those were driven by the fact that healthcare mergers and acquisitions activity emerged faster than other sectors. What you saw was a lot of individual shareholders or private equity firms or venture firms looking to sell companies because healthcare was a hot area. Healthcare IT in particular was especially hot, and so you saw a lot of books come out early in the year. Early in the year was driven by, “Hey, the market is hot, and it’s getting hotter. Let’s go out and get a good value for our business.”

Later on in the year, what you started seeing is a little bit of a different trend, where you have some folks who are pulling the trigger on an exit because of tax-related concerns. There are absolutely companies out there that have decided to sell because their sense is that capital gains tax rates are going to go up next year.

Even if capital gains tax rates don’t go up next year — if there’s some type of an extension of the tax breaks — capital gains rates will go up at some point down the road. That does have some impact on decision-making, because even just a five percentage point increase in the tax rate, if you’re doing a $100 million deal, that’s potentially $5 million of more money that you’re paying to the government on January 1 as compared to December 31. That’s been another driver.

The other thing that you’re starting to see — and I still think it’s an early phase of this — but you’re starting to see this phenomenon that I thought we would see a while ago. Companies that are somewhat weaker, that aren’t growing as quickly or aren’t growing at all, or don’t have as strong of a product set and product capability — some of those companies are finally saying. “You know what? Either this market is moving, it’s not moving fast enough, or we’re not moving fast enough in terms of our internal growth to really dig our way out of our current predicament, so we’re going to sell because it’s probably not going to get any better.”

That’s something I think we’re going to see more of, because the way that I characterize the M&A market right now is it’s really kind of a world of haves and have-nots, if you will. Normally what you see in terms of valuation multiples — the multiple of revenue or the multiple of earnings for which a company sells — normally you’ll have a normal distribution of that. If the median multiple is 10 times EBITDA, then you’ll have a bunch of deals happening close to 10 times EBITDA, you’ll have a few deals happening at 15 times EBITDA, and a few deals happening at five times EBITDA.

Where the market is right now is much more in kind of a bimodal distribution. You have a some deals happening at very high multiples, and you have a bunch of deals happening at much lower multiples. You don’t have a lot going on in the middle. I think as this M&A market continues to mature and as the cycle continues, I think you’ll see more activity in the middle. You’ll see more kind of eight to 10 times EBITDA deals happening, but right now, it’s really at the extremes.

I would assume that the number of deals on the high end probably has always been the same. Does that mean more people are unloading for less than they expected or less than historically has been the case?

There are certainly a few more deals on the high end than over the last couple of years at least, but it does mean that more people are unloading at the low end.

Some of that comes back to putting yourself in an investor’s shoes, where you’re an investor in a company that is $3 million in revenue, and you put money in it maybe five years ago, maybe seven years ago. Just to use hospitals as an example, although it would apply to the physician software, it would apply to payer software in 2008, when the hospital spending really froze because of the capital markets early in the year in terms of the auction rate securities and the lack of liquidity for hospitals, later in the year as the market downturn occurred when hospital spending slowed, then the growth source for a lot of these companies slowed down.

But coming into 2009, you had this grand stimulus package that was going to drive all this growth in healthcare IT. Well now it’s a year and a half later, and a lot of those companies that were doing $3 million in 2008 did $3 million or maybe $3.1 or $3.2 million in 2009, and did maybe a little bit more than that or are going to do a little bit more than that in 2010. But from an investor perspective, they’re saying, “How long am I going to have to wait for this market?”

While there are certain subsets that are seeing tremendous growth, my opinion just from talking to a lot of different companies out there, a lot of companies are having a tough time just getting decent growth because resources are geared toward making sure that you can get your Meaningful Use dollars. Resources that aren’t geared toward Meaningful Use dollars are severely restrained, and they’re going to be focused on those things that are going to drive the highest ROI for the hospital.

It’s very competitive for those capital dollars. As a result, demand is soft, and investors say, “Well, do I want to count on demand improving in 2011? I’m going to have to invest more. I’m going to have to wait a few more years.” Or maybe it’s not throwing up the white flag, but it’s certainly, effectively surrendering and saying, “All right, I didn’t do well on this one. I’m going to move on to the next one.”

If you look at the effect of federal money on the potential for company profitability, when do you see that peaking?

I think you’re going to see it peaking in 2012 or 2013.

Really? So you don’t think it’s here yet, so there’s still a lot of opportunity for companies to improve their bottom lines in the next couple of years?

I think there are a lot of opportunities to do that, but the problem is you have to be really disciplined leading up to that point.

Part of the challenge that you see with folks who are selling at less than optimal values is that they’ve found themselves between a rock and a hard place. They see the potential a couple years down the road, that whether they would be direct beneficiaries of the stimulus dollars or not. As those dollars flow into the system, it will create a much more favorable capital spending environment for hospitals. Maybe not much more, but at least a more favorable capital spending environment for hospitals, but you’ve got to get there.

Candidly, I’m still of the view that if you really dig into the performance of the large majority of companies out there — whether they’re selling to hospitals or physicians — I think that the reality of sales momentum is far short of the story that’s been told. Not story as in a negative thing, but kind of the potential that’s out there. I just think this market, it moves slowly. You’ve been around the market long enough.

It’s like nothing happens fast here, and while the HITECH dollars would drive all the spending, effectively what they did is they froze things for a very long time. Consultants got a ton of business over that timeframe as people tried to figure out what to do.

But now as the middle-of-the-market folks are actually implementing their plans, it still is just going to take time. In that time, you have to be really disciplined. You’ve got to figure out a way that you’re not going to be reliant on outside money to come in to fund you. You have to make sure that you can figure out a way to cash flow yourself rather than being dependent on an investor to do it because investors very likely will get impatient with your performance if you can’t show that very immediate path to profitability.

Given how slow this market, is you’ve got to be able to hunker down and make it through. Down the road, there’s a ton of money to be made here, but it’s going to take time.

Companies will need to ride the wave up now and then down again when the surge of money runs out. Do you think that’s a concern, where companies look good now but will be terrible later?

I think there’s definitely some of that. That’s one of the things that as folks are looking at investment opportunities or are looking at companies you want to line up with. You do have to be careful about that.

It comes back to if you look at what happened to the professional services space in healthcare IT leading up to Y2K and then what happened after that. You look at it and you go, “Wow. All these companies were growing like crazy, and then business fell off really quickly.”

It wasn’t all just Y2K-driven, but what it came back to was you had the combination of the outside threat went away, you had a recession that came along, and then hospitals cut back on the professional services spending. You had this very quick retrenchment that a lot of those organizations had to do. For some of the bigger ones, it was really hard to dig out of that at all because it’s one thing to grow, it’s hard to cut. I think that’s the risk that you see.

And once again, not until 2015 or beyond, but the risk that you will see is that there will be all this money flowing through the system and folks will invest on the assumption that that will be there forever. It won’t. You’ll certainly see some businesses that will really struggle at that point.

Who are the potential buyers out there, and what is it they’re looking for?

In terms of the buyers, my fundamental belief is that this is still more of a buyer’s market than a seller’s market, if you want to have kind of a general view of the market. Now in certain subsectors of the market, it’s definitely a seller’s market. You can’t just say it’s a buyer’s market across the board, but in more places than not, it’s a buyer’s market.

Before getting to who the specific buyers are, generally what buyers are going to be looking for are businesses that can grow and that are growing, and businesses that either are or can show that they can be immediately profitable. Folks really aren’t interested in spending much money on businesses that are declining in revenue or going sideways on revenue and are either just making a tiny bit of money or losing money. Those are tough things to get to the finish line, and the value that you’re likely to see in situations like that will tend to be that you’re not going to get great valuation multiples.

Where you’re going to see the really big valuation multiples are going to be in situations where the business is growing, they’re making money, there’s significant growth left for them to go after, and then you’ll see some of these well-capitalized strategic buyers stepping in and making a play. The case examples on that really come back to you look at the deals that Ingenix has done over the last few months, and obviously varying multiples in terms of what they paid for things. But they’ve certainly been willing to pay more aggressively for businesses that they feel they can use their existing infrastructure — their existing customer reach — to generate substantial incremental value. Ingenix absolutely is going to continue to be a significant buyer. Emdeon is going to be a significant buyer.

You look at the McKesson / US Oncology deal. Very interesting in terms of how that changes the axis of that company a little bit beyond where they’ve ever sat before. In organizations like that, you’re going to see substantial increased acquisition activity because they can afford to look at a lot of different things and they’ll be able to pick and choose those deals that make the most sense for them.

I think, realistically, all of the large — whether it’s a diversified healthcare entity like a McKesson, or a specific healthcare IT company like an Allscripts — I think you’re just going to see a lot of acquisition activity on an ongoing basis because there are a lot of companies that want to sell and I’m not going to say there’s a very short list of buyers, but it’s not a huge list of buyers. The pure healthcare IT- and healthcare-focused companies are going to be able to pick and choose and pick those things that are going to drive the most value for them.

I think you’re going to see more folks coming into healthcare from outside of the space. Traditional software players are absolutely going to continue to increase their presence in healthcare. You’ll see traditional services players increasing their presence in healthcare.

Then, alongside all those groups, you’re going to see the private equity universe, whether bio guys or growth equity investors. You’re going to see them looking at healthcare technology and services as well because at the end of the day, it’s a market that healthcare as a whole is going to be growing in  2-3-times GDP over the foreseeable future. Healthcare technology and services will be growing faster than that. So if you get a business that is just growing at the market rate, it’s a nice business. If you get a business that can grow faster than that market rate, it could be a great business.

I think there’s a pretty broad universe of buyers right now. The problem is that buyers are picky because they’re getting to see a lot of different things, so they can afford to be picky.

In the past, the big money came from outsiders who didn’t know the market very well and got taken to the cleaners by buying something that industry folks would have thought was puzzling. Would you agree that if there’s big money to be made, it’s probably going to be somebody who just wants to buy a foothold in healthcare and doesn’t really understand the positioning of a specific company?

I think that’s one of the ways. The “stupid money” coming in is something that has been around healthcare forever. I don’t think that goes away. I actually think the folks who can stand to make the most money and make the best returns, in my opinion, are ones where you can make a very simple case. Some of this comes back to the case that can be made for somebody coming into healthcare from outside of healthcare.

But if you think about healthcare IT at its most basic level; you have, just round numbers, 6,000 hospitals. You have anywhere between 600,000 and 800,000 physicians and thousands of other care providers in this space. Just think about the provider universe and think about how fragmented that provider universe is and how hard it is to have a footprint that touches more than a fraction of that provider universe.

In my opinion, where folks will get the best exit multiple — where they’ll get paid the highest multiple for their business — and where the acquirers will make the most money on that are situations where you have an acquirer who has really broad reach and you have a seller — a target — who has a great product that is getting traction on its own, but will get a lot more traction if it can just access that acquirer’s distribution network.

Those are the situations where, honestly, if you look at the financial models, acquirers can afford to pay a lot. They can afford to pay what may seem to be irrational prices because the return that they get is incredible.

You go back to my favorite case study on that is the McKesson acquisition of ALI way back when. They hit the market just right. They bought a great company with a great product. They paid a huge number for it, but it really worked out for them and they made a mint on it because they could increase the price. They rolled it out to their customer base and it’s been a great outcome for them.

I think you look at some of the other deals that have happened over the last 10-15 years in the space and those are generally the deals that are the best outcome for everybody — that you have something where it’s a great product, a great capability, a great solution that gets acquired by someone who has a customer base that’s already interested in that solution. You put the two together and they get to take the market by storm. The sellers made a lot of money when they sold, and the buyers make a lot of money on being able to sell that product to their customers.

Sounds like it’s time for Oracle to buy Cerner. What do you think?

I don’t know about that.

You know Oracle wants in. They’ve got to buy something. They have so much cash that surely they want to be in healthcare.

They definitely want to be in healthcare, and I think you certainly can make a case that they’d buy Cerner. I actually think if they were trying to really mix it up, the angle that somebody would take — and once again, I know Epic’s not for sale and Meditech’s not for sale and eClinicalWorks isn’t for sale — but the concept of a big outsider coming in and picking up one of those folks would be the really big game-changer. They’d have to pay a huge number and maybe there’s not a number that’s big enough, but that could be a huge game changer.

But you’re right. From Oracle’s perspective, they did pick up Phase Forward, which makes them not the 800-pound gorilla, but the 2,000-pound gorilla in the clinical trial software space. But they certainly can’t sit here and look at the hospital market and the physician market and say, “Well, we’re not going to touch that.” I mean, there’s too much potential spend there for them to overlook it. The question is whether Oracle and folks like them, whether they decide to take a big jump or a little jump.

Interestingly, if you look at what historically works the best for folks entering the space, generally the big jumps have been tough. You think about McKesson/HBO. You think about Siemens/SMS, GE/IDX. You run down the really big deals and they haven’t worked out that well as compared to some of the ones where there have been much, much smaller plays. They’ve generally worked out a lot better.

If you had Larry Ellison’s wallet, how much would you be willing to spend on Epic?

That’s a great question. I would be willing to spend if I had his wallet — and I don’t have his balance sheet in front of me — but if I had his wallet, I’d be willing to pay a huge number for Epic because I think that in doing that, you’re effectively locking up a lot of the market for a long time to come. You go in and you say, “Well, what are the biggest hospitals in the United States worth from an IT spending perspective over the next 10 years?” You’re not talking about a two-year horizon or a five-year horizon. You’re talking about a really long-term horizon just given the decision cycles on these systems, and it’s a really big number.

You didn’t give me a number, so let me give you mine and you tell me if it’s too high or too low. I was thinking between $5 and $10 billion.

I actually would have said, without knowing exactly where Epic’s numbers are, $5 to $7 billion.

Of course that means you’ve got to have a seller.

Now honestly, I think that Judy and her team would still probably say no. I’d be surprised if somebody hasn’t come to Epic and offered them an absolutely tremendous number. But from Epic’s perspective — and I think this is part of the issue you’d see with a lot of folks out there — that’s not why they’re doing it. It’s not to just throw a bunch of cash in the bank.

I think if they felt that doing something like that would allow them to do a significantly better job of serving their customers, I think they’d do it and I think maybe they’d even do it for a much more reasonable price. I think that’s the take with Epic. That’s not the reason that they’re in the game.

Give me a handful of companies that most people haven’t heard of that you like.

As I look at the market, I think that there are a couple things that are going to be really, really important. The most interesting area for me really, circles around cost containment and quality management. What it gets back to is the fundamental challenge that we have as a healthcare system is that we have no control over cost and we’ve got, effectively, a fee-for-service model. We have a piecework model.

As we roll forward in healthcare broadly, we’re going to run into situations where those new approaches to care delivery and to care management and case management. Those companies are going to have a chance to build a tremendous amount of value.

There are a number of companies that are focused on — some people call it physician analytics, and some people call it the quality infrastructure. Some of these guys are thinking about it as local HIEs, but technology platforms that allow for capturing information from disparate sources and analyzing that information and deriving useful, actionable outputs from that information. That for me is a huge opportunity. The challenge that you see is that a lot of companies that play in that space are coming at it from very different angles.

I haven’t come across a company that I’d say wow, they’ve really got it. Some folks are coming at it from the HIE angle, some people are coming at it from the payer angle, some folks are coming at it from a clinical trials angle, but you haven’t had somebody who comes out and says well, here’s an infrastructure that it’s truly going to support  — whether it’s called an ACO or whatever the buzzword of the day is that’s used to describe that — but here’s an infrastructure that’s going to allow for integrating disparate data sets. In flagging issues with patients getting the right intervention and then monitoring the results, those types of things are going to be huge.

One of the other areas that I get really excited about is the home monitoring space. Home monitoring has been just a backwater in healthcare for such a long time because the reimbursement models haven’t been there to support it. Now what you’re seeing is the beginning of a trend toward coming up with new ways to go about monitoring patients when they’re in a home environment.

Honestly, once again it’s reimbursement-driven because people are fast-forwarding to when they’re not going to get paid for the 30-day readmits and saying, “All right, how are we going to keep these people out of the hospital?” Well, there are these tools that are out there that have been well proven that if you’re doing the right types of monitoring at home, you can keep people out of the hospital. Well, that’s getting pretty exciting.

Area one, it’s not interoperability, it’s really interoperable analytics. Area two is home monitoring.

I still get intrigued by the fact that I think there are a lot of opportunities in just niche-y areas that the big guys don’t necessarily focus on. Even in areas where the big guys do focus, you have the opportunity to build real expertise and just own a sub-segment.

You look at folks like Curaspan out there, in terms of the discharge management, and you look at TeleTracking in terms of the patient flow solutions. Folks like that that just pick what they’re going to do and they do it really well and just stick to their knitting and build up. Those are pretty exciting. I think most folks have probably heard of those guys, but that’s really exciting.

I know a lot of people disagree with me on this one, but I still come back to I think there’s still opportunity for — whether you call them best-of-breed or departmental solutions — I still think there are opportunities within hospitals for non-enterprise vendors. Now, do I think there’s an opportunity in a hospital for a non-enterprise vendor that has one function that’s a very narrow function? Probably not. If you just have a software product that handles valet parking at the hospital, yeah, you’re probably at risk for somebody taking you out.

But if you have a suite around access management that you could go in and you’re better than the access management capabilities of the hospital’s enterprise vendor and you have enough functionality that you’re not just a one-trick pony, there’s real opportunity for that.

I think you will see a consolidation in terms of the number of vendors because you don’t want to have 200 vendors out there. You want to have a manageable amount. The key is if you want to play in the hospital market and you’re not an enterprise guy, you’ve just got to figure out how to get big enough and add enough capability that you’re one of the surviving vendors. That’s pretty exciting to me. I think it’s an area where there haven’t been a lot of folks focusing on it, and I think some companies can really take some interesting steps there.

Last question. You get one-sentence answers.Give me three predictions on anything related to healthcare IT.

Prediction #1 is that the M&A market in healthcare IT will be very strong in late 2010 and through 2011, and then will fall off significantly in 2012.

Prediction #2 is that by the end of 2011, there will be multiple deals north of a billion dollars in the space, which would be a big disconnect from history that generally, there’s one of those deals every couple years. But before the end of 2011, there will be multiple large deals.

The third prediction would be that the actual payout for stimulus funds will be a fraction of the total potential amount.

CompuGROUP To Buy HealthPort’s Systems Business

Germany-based medical software vendor CompuGROUP Medical AG announced today that it will buy HealthPort LLC of Columbia, SC, the solutions business of HealthPort, for $24.3 million in cash.

The Alpharetta, GA HealthPort will apparently keep its other business lines, including Release of Information and auditing services, as they were not mentioned in the CompuGROUP announcement. The company was named as the top-selected RAC vendor in a recent KLAS report.

Rumor reporter Iggy told HIStalk readers in August that HealthPort was preparing to sell its non-ROI business, possibly in preparation for an Initial Public Offering like the $100 million one it cancelled last November, citing poor market conditions. Another rumor reporter Staff Infection specifically mentioned on August 11 that CompuGROUP was in talks with HealthPort.

CompuGROUP also announced its Q3 earnings today, reporting revenues of $102 million and operating profit of $24 million. The company has 3,000 employees and a market cap of $720 million.

CompuGROUP acquired Cleveland-based ambulatory systems vendor Noteworthy Medical Systems in February 2009. In September, CompuGROUP acquired the US-based Visionary Healthcare Group for up to $65 million, noting that gaining the PM/EMR vendor’s 10,000-physician customer base was a commitment to CompuGROUP’s plans to make the US a key market. CompuGROUP also announced this week that it had completed the acquisition of Swedish hospital EMR vendor Profdoc Care.

News 11/17/10

From HIPAA Police: “Re: spelling. You would think a group sending a mass e-mail pitching its market research services would spell HIPAA correctly.” You would indeed.

From Limber Lob: “Re: getting physicians to standardize processes. Princeton economist Uwe Reinhardt says that trying to get physicians to work together is like trying to get eagles to fly in formation.” I like that analogy a lot.

From Capone’s Vault: “Re: Motion Computing Mobile Clinical Assistant C5V. This is slick. The pressure will be on the iPad to match the healthcare-friendly features of this.” It’s a full tablet with a docking station, optional barcode scanner, camera, Gorilla glass breakage resistance, and hot-swap batteries. It weighs three pounds, can be disinfected, and can withstand drops (big thumbs down to the iPad in that regard). Sounds great, just a little bit expensive at the mid-$2,000 range, but IT-friendly. Motion was bad about not getting enough nurse input on their previous models, so I’ll withhold judgment until I heard from nurses who have used a C5V at the bedside.

From Randy: “Re: Connected for Health review. I am enrolled in a Health Systems Management class at Morehead State University. This book is required reading.” I’m glad to hear that – I bet its great for that. Another reader is using it in an informatics course for public health students they’re teaching. For those who don’t know, Morehead State is in eastern Kentucky. I went to a seminar at St. Claire Regional Medical Center once, which is how I knew. Thanks for the report.

From Duke Nukem: “Re: NEJM article saying doctors should beat hospitals to the punch in forming their own ACOs to protect their own interests. Harrumph – you mean the same way they protect themselves by walling off nurse practitioners and claiming medical expertise is required to deliver acupuncture? A hundred years ago, they were barely better trained than barbers and butchers.”

Microsoft says its genomic sequencing project with Seattle Children’s Hospital consumed $18,000 worth of cloud-based supercomputing resources compared to the $3 million it would have cost using traditional local hardware. It used the Windows Azure cloud computing platform.
 
Wake Forest University Baptist Medical Center is going Epic, I’m told.

Nuesoft’s IT and product groups throw down a pretty good Lady Gaga video spoof. It sounds a lot like her and many other singers today, i.e. heavy on the Auto-Tune, which I really dislike — think Cher’s Believe from 1998, which sounds kind of Peter Framptony like somebody’s singing into a keyboard (meaning you don’t really have to be able to carry a tune to be a “singer” with computer-perfect pitch – it just came a few years too late for Milli Vanilli, but in plenty of time for the cast of Glee). But I digress – it’s a pretty good video. 

A former Fallon Clinic (MA) doctor brags on the clinic’s EMR, but complains that his access to it was terminated when he left to join another clinic. His point: he can’t treat patients as effectively who have chosen to move with him since “their” information is being held captive by Fallon Clinic, who says they’ll mail him a CD in a few weeks. I think it’s a bit presumptuous to assume that his former employer will continue to let him use their systems and I assume the CD they’re sending will have the information about his patients in some standard format he can review. Beyond that, that’s why there are HIEs (other than to get federal money).

The OncoEMR oncology EMR by Altos Solutions becomes the first oncology-specific EMR to receive ONC-ATCB certification as a complete EHR, the company says.

Patient Privacy Rights releases an informed consent white paper and the results of a new patient privacy poll. The rags are picking up the poll result as big news since it finds that 90% of Americans want to be able to decide who can see and use their health information, but I should add a cautionary counterpoint that the questions were loaded with what the ever-witty Inga always calls bias of the “Do you like babies and puppies?” variety. For example: it asked lay people whether providers should be able to “share or sell your sensitive health information without your consent” and “Who should make the decision on whether corporations and researchers can see and use the information in your health records without your permission?” I don’t know how far that skewed the percentages that ended up in the 90s, but I’d say quite a bit. Still, I don’t doubt the conclusions, just the methodology. I’d also guess that quite a lot of Americans would divulge just about anything for cash (like those Brits and their passwords a couple of years ago), so maybe that’s the backup plan for those profiting from their data – just buy it from them and mark it up.

Stanford Hospital runs a pilot project in which cath and angiography patients are given iPads preloaded with movies, books, games, and Internet access to entertain themselves before and after their procedures. The hospital likes the idea because TV installation was going to be a pain.

Inga did her usual bang-up job with the latest installment in her ongoing Vendor Executive Series on HIStalk Practice. She asked 14 top executives to comment on a recent survey that found that about half of physicians in private practice expect their EMR vendor to help them qualify for Meaningful Use money. It’s always fun to compare and contrast their answers.

McKesson CEO John Hammergren comes in at #10 in the list of the highest-paid CEOs of publicly traded companies, bringing home $24.5 million in total compensation for the year ending September 30. The company declined to comment.

Vocera acquires two Tennessee hospital communications companies: Clinical Health Communications and Integrated Voice Solutions. Guille Cruze, founder of White Stone Group that spun off Clinical Health Communications, will run both organizations as a Vocera VP in charge of handoff communications products like the ones offered by those two vendors. I interviewed him back in January 2008. The companies have 30 employees and 150 hospital customers between them.

Bill Gates says robots will be the next big technology. Maybe he’s right: check out the Actroid-F from Japan, which the developing company will market to provide social services such as those delivered by hospitals. I creeped myself out when I realized that I was thinking that she’s pretty cute. I bet I’m not the first.

Healthcare is the #3 enterprise user of iPads, trailing only financial services and the tech sector.

Maybe the iPad will rank higher in healthcare in Australia, where Victorian Premier John Brumby promises that every state hospital doctor will be given an iPad if his party is re-elected. He says $12 million will cover it, but he seems vague about exactly what’s going to be running on those devices that will give doctors “easy access to time-critical clinical information,” not to mention who’s going to support them. 

In the UK, Portsmouth Hospitals NHS Trust wins a patient safety award for co-developing a PDA vital signs capture application.

Odd lawsuit: a prisoner serving 10 years for running over and killing a teenager on a bicycle while going 83 in a 45 mph zone is suing the dead teen’s parents, who he claims were negligent in allowing the dead teen to ride his bike without a helmet. He wants compensation for his “great mental and emotional pain and suffering.”

E-mail me.

HERtalk by Inga

UPMC says it will add 815 new full-time jobs, including up to 80 in IT. This announcement came following the release of UPMC’s first quarter financials, in which operating revenues grew by $77 million to $2.1 billion and profit increased $28 million to $93 million from July through October. The health system is on track to spend about $500 million on capital improvements this year, including about $100 million on its EMR implementation.

Former Sentillion and Microsoft executive Rick Dean moves to Humedica as VP of provider sales.

KLAS introduces an RSNA Resource Center that features several radiology-focused KLAS reports, including the Medical Imaging Buyers Guide. It’s free for providers and thousands of dollars for the rest of us.

Florida Hospital DeLand, which is part of Adventist Health System, goes live on Cerner CPOE.

Memorial Hospital (IL) selects Summit Healthcare as its integration partner as it migrates to Meditech 6.0.

Saint Luke’s Health System (MO) will implement the SeeMyRadiology.com platform to share medical images across the enterprise.

I’m guessing that Mr. H is the new BFF of Louise L. Liang. MD. In case you missed it, Mr. H wrote a terrific review of her book, Connected for Health, recommending that that basically anyone with an even remote interest in IT and healthcare read the book. The masses took the message to heart and from about 8:00 this morning until 3:15 this afternoon, the book has climbed from #2,223 on Amazon’s bestseller list to #218. It also moved from #90 to #8 on the Medicine bestseller list and from #4 to #1 in the Public Health category. Heck, Dr. Liang should buy Mr. H a Christmas ham. Speaking of Christmas, I’m putting the book on my list.

Preliminary data from HIMSS Analytics suggests that 22% of hospitals are capable of achieving 10 or more of the required core measurements for Stage 1 Meaningful Use; 40% have the capability to meet five or more of the menu items. HIMSS Analytics says it will provide quarterly updates on hospitals’ progress beginning January 2011.

Apple’s AppsStore rankings for the Top 10 EMR and Operational apps can be found here. Bedside by IMS MAXIMS tops the EMR and Operational apps list and ranks 150th in the overall medical category.

A spokesperson for Advocate Health Care says patients experienced little or no interruption in care despite an 11-hour computer crash that affected 10 Chicago-area hospitals. The health system’s Cerner system went down about 5:00 a.m. Saturday, requiring employees to take patient orders on papers and access records using backup computer systems.

Sponsor Updates

• Chandler Regional Medical Center (AZ) will implement the GetWellNetwork interactive patient care solution and integrate it with its Meditech 6.0 system.
• API Healthcare names Lisa LaBau COO. She was previously with Cerner and Dynamic Healthcare Technology.
• Precyse Solutions appoints William F. Bria II, MD, CMIO for Shriners Hospital for Children in Tampa, to its advisory council.
• Allscripts wins the 2010 Excellence Award as the fastest growing company by the North Carolina Technology Association.
• Baptist Health Care (FL/AL) executes an agreement with NextGen to deploy its EHR and PM solutions  for its employed physicians. Baptist will also offer system access for community physicians who choose to purchase the solution.
• CareTech Solutions added three new healthcare clients to its Web products and services division last month, including San Juan Regional Medical Center (NM), Southern New Hampshire Medical Center (NH), and  Wheaton Franciscan Healthcare (WI). The company also announces Version 4.0 of its CareWorks content management system for hospitals.
• CapSite will present at the 22nd Annual Piper Jaffray Health Care Conference, to be held November 30 – December 30 in New York.
• ICA earns a spot of The Nashville Post’s Fast 50 Award for being one of Middle Tennessee’s fastest growing companies.
• At its annual user conference last week, Nuance recognized 25 healthcare organizations for saving one million dollars or more on medical transcription costs as a result of implementing Nuance’s eScription platform. Eight other organizations were also recognized for their gains in medical transcriptionist productivity.
• McKesson partners with the Emergency Nurses Association to offer the ED Benchmarks Collaborative, a Web-based subscription service that helps EDs identify trends and compare their performance with that of other facilities.
• Ingenix CTO Art Glasgow will speak Thursday at a congressional luncheon on the state of HIE initiatives at the Institute for eHealth Policy in Washington, DC. It will be broadcast online for those who can’t make it to DC.

E-mail Inga.

Book Review: Connected for Health

I’m rarely a fan of healthcare IT books. My criticisms generally fall along these lines:

• The author isn’t original, authoritative, or knowledgeable.
• The book tells me nothing that wasn’t obvious or that I don’t already know
• Its content isn’t really “meaty” enough to get excited about.
• It uses too much material already available elsewhere, with lots of citations and excerpts that make it look like an imitative journal article.
• Whatever knowledge the author possesses isn’t generalizable to everybody else.
• The book is a chore to read because it’s written pedantically or without skill.
• It doesn’t deliver an end result that makes me happy to have spent the time and money to earn it.

Connected for Health: Using Electronic Health Records to Transform Care Delivery raises none of these criticisms. I found it to be fascinating and informative. It is easily the best work I’ve read on healthcare IT’s role in changing how healthcare is delivered.

I’ll try to keep my review short, but there’s literally something on every page that’s highly useful even to someone like me who’s been in the industry forever and thought they’d figured it all out by now. I’m pretty sure I’ll read it at least five times over the next few weeks since there’s a lot to absorb.

(By the way, if you teach any kind of healthcare or healthcare IT class, this would be a great course resource).

In the interest of disclosure, here’s all I have to share. A book PR company asked if they could send me a free copy in case I wanted to review it. I said OK, but didn’t commit to anything since I don’t like reviewing books (I almost always have lots of criticisms, but then I feel guilty for laying them out even though someone asked me to review their book honestly). I don’t have any connection to Kaiser, I don’t know any of the authors, and I didn’t even try to sneak one of those commission-paying Amazon links above just in case you click on over to buy a copy.

Now I’m not about to sell out my integrity for the price of a book, so rest assured that it’s the same old cynical, dismissive Mr. H talking. Keep that in mind because I’m about to turn into an uncharacteristic cheerleader for Connected for Health. I’m hoping this doesn’t taint my curmudgeonly image (or encourage other authors to send me books to review that I’ll probably not like).

Every hospital that’s using or planning to use clinical information systems should buy copies for every board member and executive. It’s that good. It sets the vision and perspective needed to embark on big-budget projects involving CPOE, nursing documentation, ancillary systems, and data warehousing. It doesn’t tell you what you should do, but it tells you what KP did. And a lot of what KP did and is doing is what everybody else should aspire to.

I think you’d have a tough time arguing why KP’s methods wouldn’t work in some form for other hospitals. Instead of having one of those dopey CPOE kickoff meetings where the winner of the “name our clinical system” contest is announced and everybody pretends they are committed to something they don’t even understand, pass out copies of Connected for Health (even better, do it well before any important decisions are made, like choosing a vendor or developing the project plan).

The book covers in perfect detail Kaiser Permanente’s HealthConnect project, the largest non-governmental HIT project in the world. You might think, “What does that huge organization and its $4 billion project budget have to do with my hospital?” Plenty, as it turns out. Most everything in the book is relevant to the EMR-type projects of even modest-sized organizations. Only the scale differs. The issues are pretty much the same everywhere.

Maybe the most important takeaway is that you’re wasting your money on software if you can’t back it up with the pieces that go with it. Hospitals where I’ve worked shot their wads buying an arguably overpriced clinical system, then ensured mediocrity by trying to run it as an on-the-cheap IT project. We didn’t have enough dedicated resources, we weren’t willing to pay community-based doctors for their time to help out, and we went cheap on end user devices and support resources. Maybe Kaiser did a lot more than a typical hospital could afford, but their results have been proportionately more impressive. They spent a ton of money, effort, and planning to go live, but then as the book says, “Welcome to the starting line.”

If you ask me, the foreword by Don Berwick (then of the Institute of Healthcare Improvement, now of the Center for Medicare and Medicaid Services) is worth more than the cost of the book. Don’s a quality and outcomes guy, not some IT geek doctor with four smart phones on his belt. He focuses on patients, not vendors and deals and Gantt charts. I could have worn out a highlighter marking the parts that had my head nodding.

Here’s a snip that struck home as I thought of all the failed, expensive implementations that are wasting the budgets and energies of hospitals looking for an electronic magic bullet to will absolve them of the responsibility to change themselves and instead just convince themselves that swapping out their data plumbing is the Holy Grail:

Without clear incorporation into the actual processes of care, and without the re-engineering of those processes, and without the changes in norms, capabilities, and culture to allow those new systems to take root, KP HealthConnect would become what far too many other health care organizations had already discovered in their own modernization journeys: the computerization of a defective status quo. Kaiser Permanente was not after a modern information system; they were after a modern health care system. Halvorson called building KP HealthConnect “laying tracks”, but he and I both knew that, in the end, it would be the trains, not the tracks, that mattered more.

Kaiser’s former SVP of quality, Louise Liang, MD, ran the HealthConnect project and edited the book (quite nicely, I should add, since I’m highly critical of editing in general). Its chapters were written by local Kaiser experts on everything to system selection to redesigning primary care. Every one of them is a gem, coming from slightly different perspectives, but with a lot of useful information from an organization that has actually done what all hospitals wish they could do.

Now a cynic (like me) might assume that some of the accomplishments might have been glorified a bit by the home team authors, and maybe they were (certainly anyone who has attended a “look what we did” presentation at HIMSS knows that reality and PowerPoints sometimes don’t intersect). KP probably struggled more than was detailed here, and most likely made some stupid implementation mistakes not listed and let politics and let executive egos drive expensively bad decisions that are regretted to this day but not brought up in polite company (like everybody else does, in other words).

I didn’t find that possibility at all concerning since the material has high value even if that’s true. If you’re a skeptic, just consider the book a picture of a desirable future state that Kaiser may or may not have achieved.

Besides, there are some KP warts in there. They had a terrible time getting regions to standardize (I loved this saying: No one is either so high in Kaiser Permanente that they can make a decision, or so low that they cannot veto a decision.) They wasted a lot of money on failed EMR projects. They had to fight human nature. They overspent. They first decided to expand the use of a homegrown system that one of its regions had developed, but then reconsidered when it fell short on its ability to turn KP into an enterprise-wide electronic backbone going beyond just automating clinic offices. They had to sell the vision to the board with the frank admission that KP was “betting the farm” that KP’s form of medicine was where the country was going and their existing systems couldn’t support the transition.

I found this tidbit interesting. They could find only two commercial vendors able to handle everything from medical offices to hospitals. Epic was named, but KP thought they were shaky because their hospital experience was limited back in 2003. The other vendor wasn’t named, but I assume it had to be Cerner, and whoever it was got axed because of inadequate ambulatory experience. Everybody always wants to know why the Epic wins big hospital deals – the book makes it clear from the customer’s perspective that it’s partly because of the company’s vision and leadership, but maybe mostly because their competitors aren’t very good, especially when it comes to connecting the multiple venues of care offered by larger health systems.

KP did a lot of upfront thinking about HealthConnect, which hospitals unfortunately rarely do beyond choosing their vendor. They brought in a wide variety of people to set the vision, not just for the Epic system, but for how care should be delivered. The items that group came up with in 2003 are pretty much dead on with what’s happening today. Their themes were: (a) Home as the Hub; (b) Integration and Leveraging; (c) Secure and Seamless Transition; and (d) Customization.

The book has a wealth of information about project structure, implementation, budgeting, and leadership. Maybe you don’t buy the vision thing (which probably means you shouldn’t be in charge of anything involving patient-centered IT) but these project details will make your time spent reading worthwhile.

The idea of a Collaborative Build was key, where HealthConnect would be built at a national level, but with some customizability allowed by each Kaiser region. The key point was: first standardize, then diverge. They knew that it would be much easier to force standardization and then relax it later as needed, rather than trying to tighten up after the fact (that’s a Management 101 principal that I’ve always embraced – start out as a tough guy, then loosen up later, because the opposite never works).

There is much detail on how KP identified and involved physicians of different capabilities (operational leaders, opinion leaders, and technically adept). They helped choose the system, develop the clinical content, and sell the idea to their peers (clinicians won’t necessarily be faster, but they should be better, they said).

I’m happy to see that a whole chapter was devoted to nursing leadership and impact. It talks about standardizing terminology, involving nurses in system decisions, and looking at specific goals for barcode medication administration and medication administration.

There’s a really nice chapter called Making It Matter that looks at value and quality.The best part was the description of how the goals of HealthConnect were aligned with KP’s commitment to members, something I have pretty much never seen by hospitals anxious to whip out their checkbook and get their CPOE implementation underway before everybody loses interest. KP knew exactly what it wanted to do in a big picture way: make clinical information available around the clock, deliver superior outcomes, become national leaders in patient safety, use patient preferences to make decisions, and several other very specific organizational goals. HealthConnect was the technology enabler, not the project itself.

An idea I really liked was called SmartBooks for Value Realization and Optimization, which was an extremely well developed list of 250 opportunities that each Kaiser organization (region, department, etc.) could use to improve performance by using HealthConnect. The book also has a lot of information about quality data, outcomes measures, and a full chapter on population health (nearly always ignored by four-walls-centric hospitals and health systems). When you see the scope of HealthConnect, suddenly it’s clear where the $4 billion went — most of it not into Epic’s pocket.

Kaiser took a creative approach to designing primary care services. They decided to design processes to meet the needs of their populations even if capacity seemed insufficient, expecting that they could increase capacity virtually by offering more services by telephone, group visits, and e-visits. They had to have a lot of confidence to go that route.

Everybody’s heard of Epic’s MyChart, which Kaiser calls My Health Manager. The book makes an interesting argument about personal health records: surveys that show low PHR use by consumers are asking the wrong question. Consumers will use them if their services are useful and of high quality, and KP’s patients are big users of patient-to-doctor e-mails, checking online lab results, ordering prescription refills, reviewing office visit summaries, and self-scheduling their appointments.

The book has a very nice summary called Refocusing on Systems Versus Individuals that lays out a hierarch of controls for reducing risk. It says that the most effective changes are, in order: simplifying and standardizing, removing opportunities for error, making it hard to do the wrong thing, making it easy to do the right thing, providing intrusive alarms and warnings, and using reminders and non-intrusive decision support. What doesn’t work as well: policies, procedures, and training. Surprised?

Just about every group involved with clinical systems that I can think of would get an immense amount of highly useful information from the book: clinical leaders, physicians, informatics people, and executives. Every group, that is, except one: the average CIO. Kaiser intentionally ran HealthConnect without much direct IT strategic involvement, correctly identifying it as a huge change project, not an IT project. IT’s job was to handle the infrastructure and technology components, not to convince the doctors to use order sets or demand that nurses scan meds before administration. That’s nearly always true of successful big-hospital clinical IT projects. People on the IT dark side don’t usually have a lot of credibility with clinicians, no different than a Mac-using surgeon who thinks he can educate the CIO on how to run a networking team.

If you’re a CIO who thinks you need to be in charge of anything that plugs into a network jack, you will probably be licking your wounds that it’s not Kaiser’s CIO or IT people bragging about their key involvement in the book. Those willing to look at the big picture and share project responsibility without feeling threatened will find it refreshing and enlightening. It isn’t that the CIO’s role was marginalized, it’s that KP let the operational and clinical leadership lead the changes, with IT providing the technical support to enable them. The CEO set the vision, paved the way with resources, and set up the means to collaborate across several regions. CIOs will still look darned smart among their executive, medical, and technical peers for having read this book.

I would consider Connected for Health essential reading for leaders of any hospital that has an interest in quality, data, clinical transformation, and yes, technology (and I would hope that every hospital falls into that category, or at least any that I’d want to be admitted to). The $40 cost of the paperback (the hardcover isn’t out yet) is just ridiculous. At five times that price, you would be getting a steal considering the ideas it has for projects costing dozens or hundreds of millions of dollars. If they packaged up a tenth of what the book covers into a two-day seminar, you would happily pay 50 times the price of a copy. If you are an enterprising consultant, you could probably make a handsome living for many years by just traveling around the country like a honeybee spreading pollen to grateful plants, sharing your purloined wisdom about strategic vision and IT’s role in quality and cost that’s all right there for the taking.

Like I said, I don’t generally like HIT books. I hit the HIMSS bookstore with enthusiasm, but I’ve been burned too many times. I recommend Connected for Health without reservation. It did for me what no book, presentation, or article has done recently: it got me excited all over again at the potential of IT to change healthcare in a way that actually benefits patients.