News 9/23/09

From Shane O’Keefe: “Re: Boingboing. Healthcare UI is on it it today.” It’s a Minnesota HHS app screen shot. I thought sure it was from my hospital since we’ve got an app that’s a dead ringer, PF keys and all. One of our clinical apps at a hospital I worked at jumped from merely unattractive and clunky screens to what nurses called “the DOS screen,” some kind of function the vendor must have slapped in there in the early 1990s without ever finishing it. Every time a group got trained, you could stand outside the door and hear the universal gasp when it came up, a moment every bit as horrifying as the chest buster scene in Alien.

From The PACS Designer: “Re: search in 3D. If you want to save some clicks while searching and scrolling for information, try SpaceTime 3D. TPD entered HIStalk in the search box and selected Who is Mr. HIStalk and got some interesting links about our Mr. H. and his fame in the healthcare space!” Now that’s pretty darned cool. I was captivated at being able to flip through images of Web pages with the scroll wheel, although maybe the attraction was that I was reading about me.

From Barb Wyerr: “Re: CCR data exchange between practices in Wisconsin. I am a physician interested in learning who accomplished this task.” I didn’t get the name from the rumor reporter, so shoot it over if you know. Thanks.

From Raphel Cherry: “Re: Accretive Health. They are indeed a rising star in the area of revenue cycle management. They perform end-to-end accounts receivable process enhancement for hospitals, working closely as a partner with the internal staff rather than an outsourcing service. Their forte is analyzing PPO contracts between insurance companies and hospitals. The system they developed for this is very effective at finding areas of discrepancy between the contracts’ stated amount and actual reimbursement, giving hospitals an edge in appealing claims. It’s a good value proposition for the hospitals because they only charge a percentage of the incremental revenue recovered. So far they have invested very little in marketing because they have been able to build a strong backlog on word-of-mouth referrals.” I notice that its Web site is not only primitive, it’s running a DotNuke add-in that has a lapsed license (it comes up first thing when you Google the company). They must be real tightwads, a characteristic I admire in a business.

From Hilton Valentine: “Re: Accretive Health. I believe Accretive Health is owned or at least partially owned by Ascension Health. Ascension essentially seeded it by outsourcing revenue cycle work and workers from Ascension Health Hospitals in Michigan and Indiana. They have consolidated those people, systems and processes from their not-for-profit hospitals and I believe their long-term goal was to also provide services outside of Ascension Health and take the company public.” I think you are right. Accretive is listed among the many, many portfolio holdings of Ascension Health Ventures. Ascension is obviously doing just fine and about to do a lot better after the IPO. In snooping through Ascension’s tax records, I believe we have a new winner in the highest paid non-profit hospital CIO category – $803K. The legal counsel,  CMO, and several VPs make over $1 million, the CFO nearly $2 million, and the CEO over $2.5 million. It spent $700K on lobbying and has its own advocacy department. All are puzzled about how to bring exorbitant healthcare costs down.

From Billy Bear: “Re: ACS. They have mandated a one week ‘furlough’ for all employees. In other words, an enforced week’s vacation without pay. In a generous gesture, the Tucson based Midas+ division management negotiated to take the burden on themselves with a two week ‘furlough’ each. Meanwhile ACS posted a profit of $97.5 million on revenue of $1.696 billion in its fiscal fourth quarter.That’s down from a profit of $98.6 million in same period in 2008, but despite the economic downturn, ACS had its second-best quarter ever in terms of new business signings. It added accounts valued at $271 million.” Unverified.

Salar, the Baltimore clinical document solutions vendor I mentioned the other day, is named one of Baltimore’s Best Places to Work. The Fells Point company is hiring, their spokesperson let me know, and among its clients are Johns Hopkins, UMass, UPMC, and George Washington. 

My doctor’s EMR pleased me again. I got an e-mail yesterday that my lab results were in. Clicked the link, signed into the portal, and not only were all my results there, my doc had put a comment at the top of each set, adding stuff like “looks good”, “everything’s normal”, etc. I thought it was very cool, like getting another session with my doc without having to drive and fork over a co-pay.

Cerner shares are on a tear once again, screaming up to $75.17 at Tuesday’s close. That values the whole shebang at over $6 billion and Neal Patterson’s shares at an amazing $420 million. One analyst speculates that Dell wants to get into the software business and might be interested in Cerner, CPSI, or Eclipsys.

Things you can do on HIStalk: (a) sign up for e-mail updates using the form at the upper right of the page, thus ensuring that you, like 4,680 of your peers who have already signed up, can pedantically recite fresh fact after fact to your impressed colleagues who didn’t have your enviable foresight in signing up for updates of their own; (b) search through all the stuff written here since June 2003 using the Google-powered search box, also to your right; (c) check out the sponsor ads to your left (Founding, Platinum, Gold) and give the folks who keep me spouting nonsense the chance to see some return on their investment; and (d) see the cool stuff to your right: text ads, the Rumor Report button that lets you tell me your darkest secrets, a jobs list, the latest posts from the discussion board, and the most recent comments left on HIStalk posting (you are missing out if you don’t read those). And I almost forgot: the HIStalk Calendar is bulging with fun events.  Lastly, pat yourself on the back in my stead since I appreciate your reading here.

Mark Amey, formerly of Ascension Health, is named CIO over several healthcare units of University of Southern California. Don’t blame me for scalping Mark in the picture – it was some kind of arty USC photographer.

HIMSS announces the 2009 Davies winners: MultiCare Health System, Tacoma, WA (organizational); Virginia Women’s Center, Richmond, VA (ambulatory); and Urban Health Plan, New York, NY and Hearts of Texas, Waco, TX (community health). 

Listening: reader-recommended Anberlin, hard-rocking emo from Winter Haven, FL. On tour now crisscrossing all over the US. I like it when readers say, “I think you’d like this” and I do.

This is one of the most bizarre HIT-related press releases I’ve seen. The MyMedicalRecords PHR people proudly announce that they’ve paid $250,000 for an 80-million person marketing database (provided by a company whose Web site doesn’t even work). Tons of irrelevant and frankly embarrassing details are included, like how the company will pay for it, how annoyed spam recipients can unsubscribe, that they bought cell phone numbers along with the usual e-mail and street addresses, and how competitors can’t use the same database. So, let’s review: would you trust your sensitive healthcare information to a company that brags on its newfound spamming capabilities? What the hell were their PR people thinking? 

Australia’s health department cancels a contract for a desktop software package that would have provided stopgap interoperability functionality. The biggest practice management vendor decided not to participate, saying the timeline was too short and the budget too small. “Clearly, this is just another little pilot where the initial work consumes the whole budget, and there is no provision for ongoing support.”

Nobody had much to say about Dell’s acquiring Perot. Here’s your chance. I’ll probably run a Readers Write on Wednesday, so feel free send me your opinion piece. Who wins and loses? Does Dell do another healthcare acquisition? And since grabbing up consulting companies seems to be cyclically imitative, who else might buy or sell?

Speaking of Perot, the family will supposedly make $400 million on the sale, boosting the $2 billion fortune of Ross Junior and the $5 billion pile of Ross Senior. There’s that theory that even if you redistributed all the country’s wealth evenly, the same tiny percentage of people who have it now would get it all back in a few decades. I tend to believe that.

Blessing Hospital (IL) integrates its AtStaff ClairVia patient acuity system with its EMR to calculate acuity and workload on the fly from patient assessments.

A WebMD co-founder is involved with a startup called SampleMD that will replace traditional doctor drug samples with downloadable vouchers and co-pay coupons that are sent directly from doctors to pharmacies. Sounds good other than that pharma will get even more prescribing and patient data that’s none of their business.

Thanks to Kermit, who e-mailed me bright early Monday morning about the Dell-Perot deal, allowing me to scoop all the pros, which being shallow and insecure, makes me happy.

A BIDMC doctor wants patients to read the notes that doctors record in the chart, electronically or otherwise, and urges removing obstacles such as high copying costs or requiring the chart to be read only in the doctor’s presence. Mentioned is a $1.5 million national study that will see how doctors and patients like it when patients can read the chart notes.

Weird News Andy mines this gem: an ED nurse is handcuffed by a Chicago police officer and locked in his squad car after she tells him he can’t get blood samples from a DUI suspect until they’re admitted. She’s suing, saying, “We work hard. We get abused. We get yelled at. We get, you know, beat up. And to have a police officer treat an emergency room nurse that way goes against so many things.”

E-mail me.

HERtalk by Inga

Picis is declared the winner of a live “Chart-Off” during the California Emergency Physician Annual Partnership Meeting. The challenge pitted EDIS vendors against each other in documenting an electronic patient record, with Picis ED PulseCheck winning over competitors that included Cerner, Wellsoft, and T-System.

Schuylkill Health (PA) deploys SafeTrace Tx transfusion management software, which is offered through Global Med Technologies and its Wyndgate Technologies division.

Rex Healthcare (NC) signs a multi-year agreement with MEDSEEK to design and implement a clinical portal.

Apparently the locals are pleased by the economic boon provided by Epic’s annual user conference, which started Tuesday. The 3,600 attendees are expected to provide a $2.5 million boost to the economy. As I wore my boots this weekend, I thought about all the fun events planned for the the Wild West-themed meeting: horse and carriage rides, a tug-of-war tournament, mechanical bull rides, and a cow-chip tossing. Yee-haw!

Community Hospital South (IN) goes live on GE Centricity Enterprise 6.1 and Monitored Care. The combined solutions will help the hospital capture clinical and medical device data into their existing Centricity EMR system.

Two new healthcare systems successfully launch Siemens Soarian Clinicals: Ingalls Health System (IL) and St. Peter’s Hospital (NY), both of which went live in the spring.

Quality Systems, the parent company of NextGen, appoints Philip N. Kaplan COO of NextGen and the QSI dental unit. Kaplan resigned as a board member in order to take over the COO role. Craig A. Barbarosh, an attorney who specializes in organizational restructuring, becomes NextGen’s newest board member.

I got my first news bit from Weird News Andy, who said, “If ANYBODY would be interested in this, it would be you.” Apparently there’s a movement afoot (no pun intended) in the UK to ban stiletto heels in the workplace. Which is obviously just plan wrong and a violation of women’s civil rights, as suggested by the proposal’s critics. The gals on my side argue that stiletto heels give women a power advantage in male-dominated workplaces because the shoes make them appear taller and enhance their sex appeal. Someone needs to throw shoes at those crazies supporting function over fashion.

KLAS adds four members to its advisory board: Russell Branzell, CIO, Poudre Valley Health System; Chuck Christian, CIO, Good Samaritan; Jessica Grosset, CIO, Mayo Clinic; and Rasu Shrestha, chief of enterprise imaging software, UPMC.

Speaking of KLAS, the prolific research firm’s latest report looks at customer satisfaction for hospital staffing software, finding a significant gap between the vendor solutions favored by nurses and other stakeholders. Nurses prefer RES-Q Labor Resource Management and McKesson ANSOS One-Staff. Kronos Workforce Scheduler is their least favorite option. On the other hand, the financial and HR people types strongly favor Kronos over other options for its strong reporting capabilities and anticipated cost savings. That probably makes sense both ways.

MEDHOST is selected to provide the ED solution for Cox Healthcare (MO).

IASIS Healthcare goes live with the Medicity Novo Grid in two of its six regions. The implementation facilitates health information exchange between IASIS and providers, regardless of whether the providers use electronic or paper records.

If you are wondering how US healthcare compares to the rest of the word, this article includes a number of “real-life” anecdotes from American travelers. For the most part, patients reported care was good and much cheaper than comparable services in the US.

ACS State Healthcare wins a $4.5 million, two-year deal to develop the Kentucky HIE.

Blessing Hospital (IL) goes live on AtStaff’s ClairVia Patient Acuity system, which is integrated with the hospital’s Eclipsys EMR.

Officials at Phoenix Children’s Hospital calculate a $140,000 savings in license fees after implementing Orion Health’s Rhapsody Integration Engine. The hospital made monitor data available to clinicians within the hospitals. They’re adding a second Rhapsody interface, this one to establish bi-directional information exchange between the pharmacy application and EMR for another $180,000 in savings.

The local paper provides detail on the McKesson EMR go-live at Three Rivers Health (MI).

CareTech Solutions partners with Peak Positions to provide a turnkey organic SEO program to improve the search engine ranking of hospital Web sites.

This new iPhone case looks pretty handy, complete with its flash option and credit card holder. All it needs is a removable side pack for lipstick.

E-mail Inga.

HIStalk Interviews Tom Liddell

Tom Liddell is executive director of the Michiana Health Information Network of South Bend, IN.

Every RHIO and HIE sounds successful, but clearly some aren’t. What yardstick should they be measured against?

I think the yardsticks they should be measured against are sustainability from the standpoint of broad-based community support. That would be support not only from the institutional community — hospitals, laboratories, radiology centers — but from the physician and clinical community as well. That’s the foundation of an exchange in a medical service or medical trading areas.

The second one is, they really do have to have an economic or financial model that is accountable not only to the servicing organization but to the physician provider. In our particular market, we ask financial participation from most, if not all of the parties that are involved. That’s been an interesting secret, because then the value is not only perceived, but it is realized. You actually then have to deliver.

The third thing, I think, is the actual delivery of results. In our particular case, we are extremely focused on enabling the physician provider to have what we call 100% of the data in relevant care of an individual. So physician-led care that is driven by as much appropriate information that should be available.

If you have all those things, I think you then really have that sustainability, and it can provide a good long-term success.

What are some of the most innovative aspects of your service?

In terms of innovation, our approach is to try to be innovative in the service delivery components. By that, we do probably two things that are unique. We are standards based, so whether it’s HL7 or CCHIT qualifications or the emerging meaningful use qualifications, we try to stay pretty close to those bodies of work.

In doing that, there are times when we have to shape an interface delivery service where there’s an electronic health record that’s not quite there. But we try to have its origination as close to the standards as possible. I don’t know if it’s innovative, but we think it is, and we still get the job done.

I think the second innovation that we came to a few years ago was we said we want to have some available service for every provider, be it fax replacement, pushing clinical results, or, what we call clinical messaging: a community health record that is extendable, meaning over 9, 10 years worth of data, or interface integration.

Innovation is an innovation in service. We have something for everybody. If you’re a nursing home, we’re going to make you more efficient. If you’re a specialty provider, anything that you’re copied on that a primary care doc orders is coming your way, whether it be through a delivered portal or through your integration or interface integration.

The other thing that we’ve done, which I don’t know if it’s innovative, but it’s really working, is that we are one pipe into that physician provider. We are really taking care of so much of the burden that a physician practice would have if they had to go out and say, “Hey, I need to connect to laboratory, and then I need to go to this hospital, and then I need to go to that hospital.” We literally take it all the way down through the vendor and watch results go into that electronic health record. That’s been a huge spark and fuel that’s been there.

The last thing that we do is what I would call it a best-of-breed provider. I believe that the market is still pretty early with an incredible amount of business opportunity, meaning I think we’re going to see a ton of innovation over the next five to ten years. We are not, “Hey, it’s only going to be Cerner’s architecture.” While we think it’s great, we see that Axolotl had a fit for us, and we see that Medicity might have a play with their box. We also see that there are places where something like the Mirth engine might fit.

So we’re a best-of-breed, meaning we want to keep ourselves open to not being only locked into a single vendor, a single strategy.

How many employees do you have and what do they do?

We have 14 full-time, two part-time, and two interns. They’re largely boxed in three areas. The first area is our development area. That is the area that we have services around the creation development, the deployment of, that which is exchanged. That could be anything from standards creation for an interface bringing a new hospital onboard, bringing a large multi-site physician provider practice and literally doing that development. That’s coding interfaces that’s creating the roadmap for those things. In some cases it’s sort of boring, benign, making sure that we have a common set of standards that are deployed. That’s the development group.

We then have the service and operations team. That’s where hardware, technical, and application support reside. That’s everything from working with our servers and data farms to data management to our Oracle database as well as we have other database management tools to the team that runs what we call our frontline services. We try to, if anything, overemphasize that first-line service, and that we answer calls all the time. There’s no other drop boxes for that. We believe that that’s important, because if anything, it’s right at that point that that coordination and service needs to be there. That’s that group.

The third group that we have houses what we call our physician services. That’s comprised of anything that relates to the physician or clinical service that goes out to the community. They do all statements of work, all integrational projects around, whether it be pushing results to our clinical messaging system and rolling it out for a hospital. We do work with Dragon, those kinds of things and add-on products. It’s really enablement in that physician clinic space for that.

Inside of that, sorted of grafted on to that group, we also have what we call the institutional team. That’s just one person working on the institutional side to make sure that their efforts are coordinated. That’s your hospitals, labs, etc.

The last little group we have is really myself and one other guy that do what we call our business development, which is when we go and talk to a new customer, RFIs and RFPs. What we’ve done is we actually outsource with one of our partners, one of our owners, some technical services. You can almost say we’ve got two additional FTEs that do technical capacity work for us.

Our interns — we’ve done a couple of things. We have a medical student — in fact his whole summer was dedicated to, and is still keeping track, and he’ll be back in the holiday season — we’ve been studying what we call medication management. Everything from how many people have adopted by county, by specialty, to what’s happening on medication reconciliation and what a patient needs in the hospital. It takes about 24 months to set up a service properly.

The second intern we have is a programming intern. We’ve really tried to call out both clinical users as well as people that are more in the technical line of services out there.

You are working with the GAO on PHI disclosure. What are your thoughts around that?

I guess I could say we completed the first round of work. We were the first place they called, so I guess that was exciting. They were very nice and accommodating. A team from Atlanta came and spent the better part of a day and into the next day. We went through everything.

It was actually a great example where we were able to bring security specialists from the institutions and we lined up basically according to the services. If you were doing clinical messaging, we hooked them up with a clinic, so that they could understand how that would go. If you were doing interface integration, we brought them over, and a CEO of a 25-provider oncology group showed them how they their release and how their information kind of flows. And then we did a roundtable with them in the afternoon.

I think it was a very eye-opening and kind of a learning process for those guys. I think what they also understood in the end was that we are mimicking the delivery and replacing the delivery mechanisms that are already in place today. If a provider is copied on a laboratory result, we’re basically just improving that method of delivery and really making it more secure in that. So I think it was beneficial there. Then we had a follow-up and help them see what other exchanges are operational across the country that they could coordinate with.

It’s very important, because as ONC not only lets funding out at the state level, that coordination be able to monitor if those dollars are going out appropriately. Are they being spent appropriately? Is there security and protection for that individual consumer? I think these are important integrations to that.

Many people wouldn’t think of Cerner in the practice EMR area. What’s been your experience with that product?

In my experience from my WebMD days and when I was a senior VP of product management and had a lot of work in developing an EHR, you start to see the tremendous capabilities that the tools that they’ve built have. They are committed clearly to making sure that the enterprise, whether it’s an institution, clinic, laboratory, etc., are able to be co-joined, commingled, and integrated into that process.

They’re working their tails off to change perception and image. I can only tell you that it’s pretty operational for me, with my sleeves rolled up, that the product itself has an incredible set of capabilities. If anything, you want to try to gear those back. That’s probably easier to do in the long run than to try to catch up and add an incredible set of features.

One of the nice things that I have the benefit of is for those that use the component, which is more of an EHR in our market, it’s not a question of “could we do something?” It’s how they want to do it. For me, that’s actually pleasing, because I can have a discussion that says, “Do you want to proxy to your inbox for something that was just ordered or copied to inpatient/outpatient?”

Unfortunately we want to make healthcare simple, but it’s a pretty complex enterprise, especially around health information.

Having said that, like anything, there are lumps along the way. We busted our tails to make sure that e-prescribing and all those things are up. There’s a lot of parts that are moving, whether it is Surescripts RxHub or whether it’s having a clinical summary available in an HTML or XML format.

In fact, we had a strategy call yesterday with two other executives. We do it regularly, and it went almost two hours. They can tell you they’re listening. I can tell you we’ve had a pretty significant summer in terms of adding providers to their core business as well.

How sustainable is your business model?

First of all, there’s been these naysayers out there saying, “Should we work to build these kinds of businesses and services?” I guess I would say you have to have value, and if you deliver value, I think people come and are willing to pay for those services.

Certainly health exchange has an element of a political aspect to it, but I don’t mean on the national level. I mean certainly against the competitive entities and those kinds of things. But once people get beyond the notion “don’t compete on health information; compete on everything else” you can start to make the exchange sustainable — you can make that case for doing that.

But I think in all things there has to be that perceived value. One thing I do know is when you settle all the noise around it, there has to be an entity that is a facilitator of those common services, whether it’s building a referral management network, whether it’s moving or integrating data. At least it’s demonstrable in places where you don’t have that. It doesn’t get off the ground, or it doesn’t sustain, because there’s nothing to sustain itself with.

I’m certainly not naïve to say, “Are there risks in any business?” Certainly there are, but the big key, I would say, is that you’ve got to be willing to adapt. When I came in 36 months ago, the only real interfaces that we were going on were basically from suppliers and I just said, “Listen, in twelve months, we’re going to be able to deliver any piece of data we have to an EHR and have it happen in there.” Well over 65% of our total market has data integrated into their electronic health record, and we feel that by the end of next year, 15 months from now, we can be over 80%.

What effects are you expecting from HITECH?

It’s been almost a tsunami so far, in that it certainly has caused all of healthcare IT to have to think differently. I don’t mean just on the funding level potentials, but to say, “How are we going to work together in and out of markets? How are we going to work together at the state levels? What can the role of a health exchange be whether it’s a working component of the extension centers or whether it’s how we pass data from exchange to exchange?” We’re in the throes right now of connecting two different exchanges just in our particular state where we can move relevant data.

I think in the end, what it’s doing for us, or will do for us is, if anything, accelerate the level of activity that’s there. By that, I mean the services that we can deliver. It’s certainly bringing awareness to those things.

I think in the long run, what I hope doesn’t occur are some of the unnatural effects. As an example, in e-prescribing, it’s great to adopt it, but if it’s adopted in a silo, I don’t know that there’s a clinical benefit, that the clinical benefits are harder to get to. There is a clinical benefit long term, but I don’t know that the patient realizes that other than maybe a medication error. You have to kind of look at it holistically and say, “But if I can do that in a more organized, methodical way inside the complement of my full EHR, I’ll have a better perspective on the patient.” I use that as an example.

Overall, it’s great. It’s exciting. It’s causing the coffee to be made late at night and early mornings, but that’s why you play the game.

Why is Indiana so strong, do you think, in interoperability and informatics?

I think there are a few things. First of all, there’s a history of innovation across the state in terms of health IT. In the market that we serve, Northern Indiana and up in through Michigan, we had early adoptions early on — early adoption both by hospitals and by physician practices of automation.

In this particular market, there have been some pretty innovative companies that have gone on and created applications, and they’ve moved down the road. When you look to the central and southern parts of the state, both with our public universities as well as Notre Dame to the north, there’s a commitment to life sciences; there’s a commitment to health information technology. We have institutes across the state that have created products.

I think one of the things that happened is that all of a sudden, we pop up, and then a group in Indianapolis pops up. You look in Cincinnati and you can almost see a corridor developing from, I would say, the middle of Michigan all the way through Tennessee that is sort of powerfully evolving health integration, health exchange.

I think those are some of the core properties as to why there’s success.

The other thing we have going in Indiana is that we are committed as a group. We got together over a year ago and just said, “How do we start to work even more closely together? What makes sense is while we’re competing, we’re still committed to doing these kinds of things that enable it.”

We found a great working relationship in the people that are across the state that are very committed to an approach that not only takes us through Indiana, but through all the neighboring states here in the Midwest.

Anything else that you want to add?

Look at the seeds of where we are. We’re ten years old. We have services in a variety of areas that help our sustainability. We’ve had significant financial commitments in growing this exchange. All those things are all reflective of the commitment that our particular market has to the products and services that we’re about.

It’s interesting — this particular exchange started from the seeds of a workgroup that I participated in in 1994. There’s a long history of people concerned with where healthcare is going and moving, and asking, “How do we become parts of the process?” There’s been a long-term commitment to health information technology. There’s been a commitment for me in a market that I’ve been basically been around my whole life. So, there’s kind of a personal passion as well.

I guess the last thing that I would say is that I can’t say enough about the commitment of our people. They not only feel that they’re into something that’s very important, but there’s a personal mission that they have. Many of these people could be in other places, frankly even making more money, but their level of commitment is incredible. And their creativity is pretty incredible as well. So, I would compliment that in our team.

Dell To Acquire Perot Systems

Dell announced this morning that it will acquire Perot Systems Corporation for $3.9 billion. The all-cash transaction is expected to close in the November to January time frame.

The $30 per share offer for Perot represents a 68% price premium to Friday’s close.

Perot will become a services unit within Dell as it attempts to diversify beyond hardware sales. Perot President and CEO Peter Altabef will say on, Dell says.

Monday Morning Update 9/21/09

From Carpluv: “Re: CCR. It has been reported that a group in Wisconsin has actually tested and exchanged CCR record from a different ambulatory EHR system. This is big news since hospitals tell doctors they have no interoperability unless they work through them. CCR and CCD are part of CCHIT certification and are certainly a component of future HIEs, but nobody really did it until this week. This reduces the drama and cost of interfaces on both sides and plays well in the small physician market.”

From Clint Gristwood: “Re: Epic. I consulted a friend and Epic employee when considering a job there. According to him, turnover is extremely high. In his trainee class of 20, only five or six were left standing after a few months. Responsibility and workload constantly accrue, and those who are struggling will only get buried. Most of the people who fail try moving into consulting or return to school for graduate studies. As far as the employment contracts, Epic cannot legally enforce them, but will try other tactics. One trick they pull is threatening to not work clients who poach Epic’s human capital. This puts a steep price on employers picking up talent out of contract.”

From Eli Cummings: “Re: Emdeon. I believe the stock analyst’s sour note on Emdeon should be taken with a grain of salt. Emdeon has a solid core transactions processing business that is unlikely to see an erosion of its recurring revenue anytime soon. This analyst previously worked at Leerink Swann, where he gained notoriety for making outlandishly bearish calls on healthcare IT companies. eResearch’s stock was devastated by a report of his, even though the thesis has yet to play out in fundamentals. Perhaps the fact that this analyst was one of only two analysts covering that company had to do with its precipitous decline. He launched a similar assault on Computer Programs & Systems (CPSI) with an Underperform rating, albeit less successful. After leaving Leerink, Bret Jones resurfaced at Brean Murray, completely turning around his opinion by launching with an Outperform on CPSI. Some stock analysts will go out of their way to craft outrageous statements if it gets them the limelight.”

From Rex Wife: “Re: smart phone software. Do you have a good list of healthcare software for the iPhone? It’s too hard to find the good stuff in the apps store.” No, but I could start one. Good idea or not?

I asked in my previous poll how much influence Dell will have now that it’s jumping into the practice EMR fray. Not much, according to readers: 62% said none and 31% said a little. New poll to your right: we keep talking about vendors as employers, so if you had an equivalent job offer from the ones listed, which would you choose?

Those computer programs that crunch through long lists of kidney donors and would-be recipients to find compatible pairs are very cool, making it possible for family members to get a transplant for a loved one even when their blood types are incompatible. University of Michigan announces that it has developed its own organ matching software. Profiled are two husbands whose tissue incompatibilities precluded donating a kidney to their respective wives, but the program matched them so they could donate to each other’s wives. Confusing, which is why it takes major software to sort it out when dealing with thousands of people and infinite possibilities.

Speaking of transplants, here’s a sad tale of family bickering: a man accepts $37,500 from his leukemic brother to donate bone marrow to him, but then backs out and says he’s too sick, claiming the money was a loan. In a statement to the newspaper, he said, “I did not make David ill, and I am not to blame for his illness” and suggested his brother find a donor registry or hit up their other brother. His brother responds, “If he knew he had this Wizard of Oz disease, this magical disease that he won’t disclose to anybody, then why did he take the money? And to say I loaned him the money, then, gee, it’s a coincidence that he needed money and I needed a transplant".”

Welcome aboard to new HIStalk Platinum Sponsor Apelon of Ridgefield, CT. The international clinical informatics company focuses on data standardization and interoperability. Its computer scientists, informaticians, and clinicians are involved with projects involving Mayo, CDC, NLM, Stanford, and many others. The company is heavily involved with deploying and maintaining terminology and vocabulary such as SNOMED CT, UMLS, RxNorm, ICD-9 and ICD-10, also working with US Cancer Institute, VA, FDA, NIST, ONC, the Social Security Administration, and Canada Health Infoway. All the work involving EMR deployment, interoperability, and data mining will require stringent deployment of expertly designed terminologies, so I’m sure their phone is ringing a lot these days. All that plus it’s their tenth birthday this month. Thanks to Apelon for supporting HIStalk and the people who read it.

The CIO of two hospitals in London is named in a whistleblower’s complaint for hiring a former colleague to do $3 million worth of no-bid consulting over six years. An internal auditor concluded, “The arrangement — and in particular, the dollars involved — begs the question as to whether LHSC should just be hiring TV (Tom Vlasic) as an employee, and stop paying the exorbitant per diem rates of a consultant. An in-house solution would most likely be more economical.” Nobody’s claiming the work was subpar, so at least the money wasn’t wasted. Also in question is whether the hospital should be working on regional integration projects (observations from the audit are above).

An LA Times article covering California’s 12.2% unemployment rate mentions a hospital IT guy who lost his job eight months ago. Shown are union members picketing Toyota for daring shut down their plant, which is full of all kinds of irony. Maybe we’ll all learn lessons about not getting too complacent about being someone else’s employee since it’s a voluntary arrangement both ways. Personally, I wish more people would hang out their own shingles instead of just looking for someone else to pay them since the idea of working for yourself is just as foreign (no pun intended) as paying your own medical bills. Small business is usually what keeps the economy moving, not multi-national corporations.

A VA inspector’s report finds that the Hampton VA Medical Center misdiagnosed a man’s stroke that left him permanently disabled. The former paramedic told the ED clerk that he was having a stroke and presented with classic symptoms, but was sent home. Also noted was that another patient’s lab result had been posted to his EMR, leading to the incorrect assessment that his labs were OK. The doctor, whose contract was not renewed, had copied and pasted results from another patient.

I interviewed Justin Barnes and Mark Segal, the chairman and vice chairman of the HIMSS Electronic Health Record Association, on HIStalk Practice.

I don’t think I’ve heard of Accretive Health, but a reader says their primitive and information-devoid Web site hides a powerhouse revenue cycle company. I found this Crain’s Chicago Business article (warning: PDF) on CEO Mary Tolan, who sounds like a fireball (the “happy, confident capitalist” fires the bottom 10% of company employees, or as she says, “invites them to their next career chapter that is not us”). It’s a $250 million company with former Secretary of State George Shultz on the board. Gearing up for an IPO, so I’ve heard.

Weird News Andy loves this, proclaiming “I’ve heard of inhaling your food, but your utensils, too?” A man puzzled by months of coughing spells and lack of energy sees several doctors who eventually figure out there’s something stuck in his lung. One offers to remove the lung, but he fortunately he seeks more opinions. Turns out he had a one-inch chunk of a Wendy’s spoon stuck there, apparently inhaled as he gulped down a drink. The doctor summarizes: “We’re looking at it and realizing that there are letters on it … We started reading out loud, ‘A-M-B-U-R-G-E-R,’ and realized it spelled, ‘hamburgers.’ Everybody was shocked. We had no clue why something that said, ‘hamburgers’ would be in someone’s lung." The patient is doing great, saying he can get around and breathe again.

Andy also noticed that two Central Florida hospitals have put up electronic billboards showing their ED wait times, updated every half hour.

Former Healthlink/IBM VP Stacey Empson joins Courtyard Group (or Couryard Group, if you believe the misspelled headline) as partner.

Two Johns Hopkins cardiologists write a Washington Post editorial extolling VistA as a cheaper, more effective practice solution that is “much more user-friendly than its counterparts.”

Boston Medical Center, a safety net hospital on such shaky financial ground that it could be closed, pays its retiring CEO $3.5 million on top of her $1.3 million salary.

Speaking of Hopkins, JHMI, MedStar, UMMS, and Erickson Retirement Communities are mentioned as the organizations behind Chesapeake Regional Information System for our Patients (CRISP), which is hopefully better at creating an HIE than it is at brute-forcing a cute and irrelevant acronym out of the uncooperative name it also chose. It’s getting $10 million in Maryland money to get going. Also mentioned is Baltimore vendor Salar Inc., which sells documentation and charge capture applications.

Former Cardinal Health marketing director Laura Bellon is named VP of healthcare solutions and strategy of Perceptive Software, makers of the ImageNow document management system.

Anesthesia systems vendor DocuSys raises $9 million in financing. It also says business has slowed and its plans to add 300 Atlanta-based employees to its current 55 have been postponed.

Allscripts shares hit a 52-week high on rumors it has signed a $20 million contract with North Shore Long Island Jewish Hospital. Market cap is at $2.69 billion, more than double that of Eclipsys and nearly half that of Cerner. Share price has nearly quadrupled in a near, so like all other investments you didn’t make, it was a natural.

Perot Systems gets its first international outsourcing deal, winning a 10-year contract with India’s Max Healthcare hospital chain worth $18 million. Perot will also deploy VistA there.

Someone goofs at Great Ormond Street Hospital in London, e-mailing detailed patient care complaints from the family of a teenager who died there to the local newspaper by mistake. It’s the usual story – the employee was trying to send an e-mail to someone by name, but instead got someone else with a similar name, in this case a newspaper reporter. The paper, showing restraint that would be surprising here, alerted the hospital and declined to disclose details about the information.

E-mail me.

News 9/18/09

From Doofus: “Re: Allscripts. Word on the street that Allscripts is sending a letter to Misys EMR clients stating that they will not make MISYS EMR compliant with ARRA guidelines and that these clients will need to move to the Allscripts family of products. Fees are in the area of $2,500 per provider and a fee per practice. Training and data conversion are not included but are discounted.” A contact there says word on the street is wrong. Since meaningful use hasn’t been defined, Allscripts hasn’t made any statement about the likelihood of MEMR being compliant or what they’ll do (or offer) if it isn’t. Maybe there was some confusion over an ongoing offer to those MEMR customers who would like to upgrade to one of the company’s better products at their convenience.

From Pat Patterson: “Re: HIStalk Practice. The last e-mail blast link takes you to the eClinicalWorks home page. PS – Tell Inga she is my ‘secret girlfriend’. I just love women who can talk tech and shoes all in one column!” Inga was scurrying to the airport and pasted the wrong link into the e-mail, leading Pat to joke that we must have sold the mailing list to eCW. She can definitely talk the girl stuff, to which I agree there’s nothing more attractive than a really smart woman who’s still fun. My secret girlfriend is Tina Fey since I’ve become a big 30 Rock fan. Love the glasses.

From The PACS Designer: “Re: InformationWeek Top 250. The latest rankings from InformationWeek’s Top 250 Innovators has been released with the following healthcare providers being amongst the top 25:  #2 Cincinnati Children’s Hospital M. C., Marianne F. James, Sr. VP & CIO; #9 University of Pittsburgh M.C. (UPMC), Daniel S. Drawbaugh, Sr. VP & CIO; #18 Beth Israel Deaconess M.C., John D. Halamka,CIO; #21 Sentara Healthcare, Bertram S. Reese, Sr. VP & CIO; #22 Christus Health, George Conklin, Sr. VP & CIO;  #23 University of Arkansas for Medical Sciences, Kari Cassel, CIO. TPD salutes these institutions for being tops in IT innovation!”

From Dr. Curious: “Re: Eclipsys. After reading the post about Eclipsys letting their consultants go and giving their implementation work to consulting partner, a huge red flag went off. In this year, they have replaced their CEO, CFO, and dismantled their professional services division. It makes me wonder if there is more to this than meets the eye. For example, could it be that they are preparing for a buyout, or are they struggling through financial difficulties? Everything I have seen and heard about Eclipsys points to a near-term end for them. What are your thoughts?” I suppose it was time to replace the CEO and CFO. Outsourcing the professional services organization is puzzling since theirs was pretty good, but it never seemed to make the money they expected it to, possibly because they don’t sell Sunrise all that often and that probably caused bench time (how else can you lose money billing out $50 an hour employees as $250 an hour consultants?) You may not have noticed that share price has made a steep climb up in the last six months, going from $8 to $20, which is highly positive given the company’s erratic financials in years past. Despite some impressive successes in clinical systems, they’re always going to be banging heads (usually unsuccessfully) with the Epic juggernaut since they have the same sweet spot, but Epic’s got everything else and not just the core doctor-nurse-pharmacist stuff. Positives: the former Premise, EPSi, and MediNotes, all good (but not cheap) acquisitions. Andy Eckert knew zip about healthcare, so I’d consider that a minus, as was the long roster of lackluster and revolving door VPs that served time there. OK, so now that I’ve brain-dumped, here’s what I think: excellent products, hopefully improved management, but sorely in need of a strategy that keeps them out of Epic’s way while earning the confidence of stock analysts. They need a Neal Patterson.

The rumored Eclipsys contractors, by the way, are Vitalize, ACS, and MaxIT. All fine companies, but as one reader said, it all rides on how Eclipsys manages them.

From Anomymously Happy to be Done with Epic: “Re: Epic. I find it really hard to believe that an office is such a perk, given that the employees actually working hard for Epic don’t spend more than three days a month in the office! And as you nicely put it, people become ‘untouchable’ when they leave Epic. They don’t truly try to LEGALLY enforce the non-compete, because they can’t! I was a team lead at Epic and you are ‘encouraged’ to set mutual end dates with your team members rather than fire them. These people are too naive to know that if they do set a mutual end date that they won’t be eligible for unemployment, etc. Mr. HIStalk, please don’t ‘Like their model as a capitalist!’ I feel really bad for new young people who think that Epic is a place to start their career!” I’ll have to disagree a little. Lots of those folks aren’t all that employable, so it’s a darned good job in comparison to their likely alternatives (and pays a lot more than Meditech without the Boston expense besides). The former employees who complain about the company are self-selecting, i.e. they left, so naturally they aren’t going to brag. The ultimate measure is employee turnover, a stat I don’t have.

From Dan: “Re: your doctor’s EMR. You are an experienced observer and your comments are welcome, but we could all use the context of the make to put it all into some perspective.” I hinted around to my doc, but he never came out and said whose product it was and, surprisingly, I didn’t see its name on the screen. I was thinking GE, but that might have been another doc that I’m recalling. He mentioned McKesson, but he was tying into some hospital information, too, so I don’t know which system he was talking about. I don’t know that there was anything all that special about the EMR anyway, but I was impressed with how he integrated it into his practice.

From RIS Reporter: “Re: Kindred. The Radiology Information System unexpectedly went down at more than half of all Kindred LTAC hospitals in the US. Current radiographs were unavailable for interpretation or view for hours. That would not be so bad, except that Kindred harbors hundreds of train wreck patients.” Unverified.

An Ohio hospital employee opens a personal e-mail from a former boyfriend using Yahoo Mail on a hospital PC, surely violating a number of IT security policies. The e-mail had been intentionally infected with a $115 commercially available program that sends all keystrokes and a regular series of screen images to a designated party (the former boyfriend in this case). He not only got 1,000 screen captures loaded with patient and employee information, he also was the recipient of up to five years in jail and a bill for the hospital’s trouble in the amount of $33,000. A quoted security expert was mildly sympathetic to the hospital, but questioned how they allowed it to happen.

Weird News Andy finds this odd but not humorous story: a patient dies six days after she is somehow set on fire during surgery in an Illinois hospital.

Alliance Health Network, which runs disease-specific patient social networks used by vendors of related products and services to try to sell them stuff, raises $3.3 million in Series C funding, raising its total to $6.6 million.

University of Missouri big wheels meet behind closed doors with “several unidentified men”, leading to speculation by 100 IT employees that their jobs are about to be outsourced to Cerner. One was quoted as saying, “The workplace is miserable. We come in every day not knowing if we’re going to have a job in five months,” which means nothing much would change if CERN takes over. The suits got careless, apparently, with the CIO letting slip the never-heard term Tiger Partnership in referring to the Cerner relationship and another executive denying a newspaper’s open records requests with the excuse that pending contract discussions are exempt, then saying “we’re done here” when he realized that he had just let the cat out of the bag by acknowledging that the Cerner correspondence involved a contract.

Edgefield Hospital (SC) signs for Swearingen Software’s RISynergy RIS. I didn’t know Randall was still selling, to be honest. Great product, but the “what if he gets hit by a bus” question always came up when we considered it at places I’ve worked, even though we all liked it. I like their Web site, in which the first menu item to the left of the standard About Us is one called About You, which is fun.

UC Irvine acknowledges that CMS nailed it with an “immediate jeopardy” warning earlier this summer, the result of a California Nurses Association complaint that faulty PCA pumps were overdosing patients. Ironically, the CMS found that the pumps were fine and it was nurse errors that caused the overdoses, one of which happened while the inspectors were on site. I’m guessing the rather radical and pro-union CNA quieted down the mad-dog rhetoric a bit on hearing the nurses were at fault like the hospital said all along.

Revenue cycle management vendor Passport Health Communication hires former Cerner VP Seth Rupp as CTO.

Medicity is offering a Webinar next Friday called On the Leading Edge of Meaningful Use: HIE in the State of Delaware.

Listening: new from Muse, dramatic and theatrical orchestral progressive. They even sound kickin’ live — a little Uriah Heep, a little Queen, a little U2 (by my untrained ear). I’m surprised that they’re #6 on Amazon and they have 63 million MySpace plays. Like it lots, although I wish they were more obscure so I could feel smug about finding them by accident.

Our sponsor friends at Culbert Healthcare Solutions redesigned their Web site with a lot of highlights listed for some of their practice areas (Allscripts, Epic, GE/IDX, revenue cycle, etc.) I have to admit that I didn’t know they did as much as they do – workflow, EHR, RCM, interim management, and systems integration. Business must be good because they’re looking for consultants, I noticed.

National coordinator David Blumenthal tells an AHRQ audience that nobody’s done enough research to really know how to implement EMRs, saying “one thing we haven’t done is apply the scientific method in the practice of healthcare and medicine.” So in other words, if EMRs were drugs, FDA wouldn’t allow them to be sold, especially $19 billion worth of taxpayer expense. I’m feeling really good about HITECH right about now. I’m being facetious, but the problem with studying technology implementation is that, unlike drugs and devices, the technology is just a reliable extender of unreliable human variation. Hospitals are run like mom-and-pop shops when it comes to repeatable processes, with a massive variation between what administration decrees and what the front-liners actually do in the uncarpeted areas of the hospital. It would be unenlightening, as well as unfair, to hold the technology accountable for any change in outcomes (good or bad). This makes probably the thousandth time I’ve said this, but here I go again: if you are really good (personally or organizationally), healthcare IT has the potential make you a little bit better. If you aren’t very good, your level of suckitude will be unchanged or very likely will increase when you throw technology into the mix.

Rwanda will implement the Jeeva system in all hospitals next year. A little Googling turned up its vendor, India-based Karishma, which focuses mostly on East Africa, Southeast Asia, and the Middle East, but which lists the USA as its #4 market, with partners IBM, Intel, and Oracle and a US office in Virginia. They offer every kind of system that a hospital would need from what I can tell. The clinical decision support system sounds really cool. This might be a company to watch.

Henry Ford Health System chooses Apollo PACS.

A stock analyst says newly public Emdeon is a “melting platform” whose clearinghouse business is threatened by new competitors (athenahealth) and HIEs, speculating that providers will bypass clearinghouses and simply submit claims directly to payors. You don’t often see a new issue getting a “sell” rating.

I’m behind again, so be patient if you’ve e-mailed. We’ve got some good stuff coming, but it takes more time than you might think. I love every minute, but there just aren’t enough of them available.

Seventeen Bangkok hospitals will use a single EMR, with one benefit being the ability to attract medical tourists. IBM is involved.

You have to like the name of this long-term care physician system: PAR 3 EMR.

Sharp HealthCare is the subject of a press release by ColdFusion Web framework / content management vendor PaperThin, which says the health system redeveloped all its Intranet and Internet pages using its CommonSpot CMS.

North Carolina wants $40 million of federal money to build an HIE, $20-30 million to hire 40 employees for nine regional extension centers, and $28 million for a broadband network for medical images.

National Library of Medicine launches the Newborn Screening Coding and Terminology Guide, intended to help states move forward with common standards for including newborn screening information in EMRs.

Children’s National Medical Center (DC) gets a $150 million donation from the government of Abu Dhabi to create the Sheikh Zayed Institute for Pediatric Surgical Innovation.

E-mail me.

HERtalk by Inga

From: Miss Manager “Re: Epic prepares for a Wild, Wild UGM. Please share fashion tips for western wear, thank you!” Miss Manager sent over this link to the Verona paper detailing Epic’s user group meeting next week, which features a Wild, Wild West theme. First, I am so glad Miss Manager inquired about fashion, since I know far more about that than I do the Epic software. Obviously, boots are a must. I have some adorable Steve Maddens with spurs, so I am bummed I wasn’t invited to attend. Other than that, you can never go wrong with lots of rhinestones and studs. For those of you more focused on HIT than fashion, here are some interesting details to note. Epic is foregoing a traditional keynote speaker, choosing to “not go overboard” in light of the poor economy. The company is offering “recession pricing” of $300 per person, versus the last year’s $600 fee. Expected attendance is 3,000 plus the company’s 3,400 staff. Needless to say, the area’s 2,500 hotel rooms are going fast, and the Super 8 and Holiday Inn Express are already booked.

3M Health Information Systems releases a new application to covert ICD-9 based applications to IC-10.

JPS Health Network (TX) selects Order Optimizer as its evidence-based order set and clinical decision support platform.

I’d love to know who wrote this. Maybe it was Mr. H himself.

Ochsner Health Systems (LA) goes live on DocuSys Anesthesia Information Management and Anesthesia Drug Management at its 41 anesthetizing locations.

Lots of apologies in the media these days: Joe Wilson, Kanye West, Serena Williams. Now Cleveland Clinic’s CEO also says he’s sorry if his recent comments on obesity caused any offense. Could Mr. H also be trying to make amends with the disabled after he recently accused the elderly of wasting government money on free scooters?

CliniComp names Stephen Armstrong VP of marketing. Armstrong is former VP of marketing and founding executive of Patient Care Technology Systems.

EHRtv.com posts 40 videos from the Allscripts Client Experience, including Glen Tullman’s keynote address and several client interviews.

Healthcare analytics company MedAssurant acquires fellow analytics vendor Catalyst Technologies. The merger creates the country’s largest company providing administrative and hybrid medical record data review and analysis.

Methodist Health System (TX) agrees to implement Webmedx’s Transcription Outsourcing Service and Enterprise software solution. The system will interface with Methodist’s EHR.

I understand that pharmacies would prefer you hang up the cell phone and talk to the pharmacist when picking up your meds. However, I think this Illinois CVS pharmacy is stretching the truth a bit with its posted signs claiming they’re unable to help customers on cell phones “due to HIPAA regulations.”

The Minnesota HIE is named a finalist for a Minnesota High Tech Association 2009 Tekne Award. The HIE is up for the Innovative Collaboration of the Year award.

The Premier healthcare alliance becomes the first group-purchasing organization to contract with AirStrip Technologies. The AirstripOB product provides providers real-time remote access to such data as maternal contractions and fetal heart rates.

Streamline Health announces its Q2 numbers: $18K loss, compared to a $429K loss last year; quarterly revenue fell 16% to $4.1 million, compared to $4.9 million in 2008.

St. Vincent Health (IN) expands it use of MedAssets’ RCM products to improve contract management, charge capture ad recovery, and claims management.

Adventist Health System signs up to implement Dolvey Systems’ computer-assisted coding solution. Fusion CAC will be installed in Adventist’s 33 hospitals to enhance both the inpatient and outpatient coding process.

Sentara Healthcare moves a fifth hospital to Epic’s EHR with its recent go-live at  Sentara Williamsburg (VA.) Sentara is investing over $230 million in the project for its seven acute care facilities and 380 clinics.

Novant Health plans to roll out MEDai’s PinPoint Review predictive modeling solution across its nine hospitals. Novant will use the tool to identify and manage its inpatient populations while patients are still in the hospital.

Here’s some promising news: at last week’s HITSP board meeting, committee chairman Dr. John Halamka predicted the cost of developing health data exchanges are likely to fall as providers begin adopting standards. Halamka is betting that interfaces that today might cost $20,000 to $30,000 might in time fall to $5,000 to $10,000.

E-mail Inga.

HIStalk Interviews Bill Shickolovich

Bill Shickolovich is VP/CIO at Tufts-New England Medical Center of Boston, MA.

You recently spoke at a conference about what hospitals should do now for ARRA. What did you say? 

I think you’re referring to a dialogue we had with HealthLeaders. That may have been back, I think, several months ago. Essentially, it was a nice round table with a series of folks nationally. I think the punch line that I was trying to get through and essentially what the others were aligning to is to first understand where you are relative to your own strategy. I think that’s first and foremost.

What we’re doing is resetting our strategy. We already have a strategy in motion relative to the elements of meaningful use. The stimulus is not making us do anything new. But it has drawn attention to understanding how much of what we’re doing lines up with the various financial opportunities.

So what I recommend people to do is to understand and have a strategy. If you don’t have one, get one. If you have one, ensure that you based on that with your leadership. Then go to a process of education. Overlay what stimulus means relative to your strategy. Simply, do you go in a different direction or do you accelerate, essentially, is what it nets down to.

That’s what we were recently in the process of doing. And it helps us to say, “Here’s the dialogue, here’s what the strategy in our program was prior to this opportunity, and here’s the various elements and scope of schedule and budget, and here’s now what it may mean relative to some of the things that we better understand now, and here are some of the things that we know, here are the things respectively that we don’t know, and of what we don’t know, we’ve gone out on a limb a little bit and through their resources tried to figure where that’s going to go, and help our leadership understand that we’ll be back to you in a monthly basis to talk a little bit about and as things mature, it has the opportunity to affect our direction the following ways.”

So essentially everyone talks about governance, but essentially I think it’s critical relative to this topic to keep leadership informed as to how your current strategy relates to what is happening and what may happen.

You’re actively involved in translational medicine. What are the IT implications?

We are, as you know, a CTSI awardee, and the clinical translation activities have broad implications to try to help various research enterprises collaborate. When we first looked at it, we were thinking, “Boy, this has very, very deep consequences.” But we’re now respectfully at the basic level of trying to just create various toolsets to at least understand and inventory what researchers are doing.

Furthermore, we’re creating some basic level of capabilities and, I hate to admit it, these are basic directories starting with human inventory. Who are the researchers, where do they work, and how do I get in touch with them?

So you’d think when this whole thing first came out, we had a deeper strategy that got into the weeds a little bit. We started to just say, “Let’s get started here a little bit.” And then we realized we’ve got to start at ground zero, and that is basic understanding of what the CTSA is in ARRA, an inventory of what people are doing, putting up a web portal and a collaboration tool, if you will, to try to help people share and exchange information, and help people understand who people are.

Those are some of the early things we found that we took for granted a little bit, because each organization does a certain amount of that on their own. But it’s taken us a little longer than we thought, relative to getting off the ground.

What we do now is we meet quarterly with various CIOs and their respective institutions and talk a little bit about what we’re doing, how it lines up, and how it relates to what other people are doing. I think we’re still in the formative stages, if you will.

What are your capabilities and plans about storing and analyzing data for quality improvement?

Great question. We are making heavy bets in our EHR program. Right now, our capabilities are around basic registry technologies, around claims data. We are working very hard to implement and deploy our EHR technology through eCW — we’re an eClinicalWorks customer. We are deploying that to our community physicians. We’re beyond our pilot now and are into our first wave of general deployment.

We are building in all of the necessary quality measures within that deployment. We’ve got a quality AQHC contract with Blue Cross that we recently completed this past year, and it’s imperative we meet those quality measures. So our quality strategy relative to information technology is leveraging our existing technologies, which consist of the patient registry and certainly our key information system, and working very hard to incorporate and ensure that any and all deployments subsequent to our deployment right now in the community encompass those various quality measures that we are contractually bound to.

It’s exciting. When you correlate investment and technology deployment to physician value and what it’s going to mean to them and to their paycheck, it’s an incredible moment.

Dr. Halamka and I had recently spoken; we collaborated on a dialogue. He had a great way to frame it. Certainly, when you speak of physician compensation, that is a very important driver to compliance. We’re finding that in order to get the adoption that we’re working very hard to gain, meeting the AQHC measures is critically important to our clinician base relative to their compensation.

How is the physician acceptance with your ambulatory and inpatient applications?

The acceptance has been very good. It’s not without its challenges, and I think you and the industry knows that. Our pilot has gone extremely well by the measure that we consider; our adoption rate has been very good.

But as we move out into general deployment, we are certainly uncovering some issues that we all have faced. It’s a constant balance between how fast you go and how much support and how much care and feeding do you give along the way.

And so our general acceptance of the technology and the strategy has been very good. It’s completely tied to our business strategy; our clinicians recognize it’s an imperative.

However, it doesn’t help us when there are various technology issues which compromise adoption. We’ve had a few of those recently, and we’re working very hard to mitigate this.

On the acute side, we are a Siemens Soarian customer, and we’re proud to say we’ve done what we consider a fair amount of work with it. We’ve actually got between 47 and 52 percent of our orders that are being entered electronically by our clinicians, and that’s on a voluntary basis.

We did not mandate that. That was actually something that our house staff came to us with and simply stated that the pressures that they are under to deal with throughput and deal with length-of-stay issues and deal with basic efficiencies, it was simply that they wanted to get off paper so badly that they were willing to work with us in a hybrid fashion to create a series of interim states relative to order processing. The house staff has adopted it extremely well.

So what are your top IT priorities over the next three to five years?

Our top IT priorities are to continue the deployment of our community EHR — that’s going to go through 2011. We’re working very hard to get in line and ensure that we have significant penetration, if not 100% penetration by then.

Two is to continue our acute information technology strategy, which includes completing medication administration, which is scheduled to be done in the acute side this fall, and move into the intensive care units, and to begin and complete the deployment of medication CPOE which is scheduled to start this winter.

Our top priorities for the next several years is to essentially meet and exceed the meaningful use criteria, so as not to leave any opportunity if subsequent funding comes on the table. We are not economically in a position to do so.

It’s not driving our strategy, because again, as I stated earlier, it’s something that’s already been in flight, but now that it’s out there, it’s certainly getting a lot of attention in light of our economic position and our competitive space in the market. We cannot afford to leave any of those funding, any of those dollars on the table if we can help it.

What would you say are your three biggest challenges as a CIO?

I think that the number one challenge right now is access to capital. I think that we all understand the economic climate that we’re in, and notwithstanding the value of healthcare information technology — I don’t think we suffer from understanding its value and importance to us; it’s reconciling the other various priorities and institutions, and ensuring that we can do the necessary things outside of IT for capital funding, and also IT.

So it’s access to capital. The markets haven’t helped us, obviously, in that way. It’s a scramble. I think that’s one.

Two, it’s respectfully dealing with the change management associated with deploying these strategies. These are not technical, and I understand not all that complex — they are tricky — but dealing with all the change management issues in a way that deploys technology in a meaningful way, pardon the pun, to get a meaningful business result in a short period of time is tricky.

Dealing with vendors that are still coming up the curve — I think they have a long road ahead of them relative to understanding what it really takes to have a successful deployment. I think we’ve come a long way, but I don’t think we’re there yet. I think the ARRA pressures will further compromise their ability to get it, if you will.

So access to capital and managing the confluence of change relative to clinical information system deployment, I guess, are my top two barriers right now, or challenges that we’re working through. I mean there’s a whole host of others. [laughs]

Keeping the infrastructure alive and running is sort of a variant to access to capital, but everybody wants the sexy new things, everybody’s pushing to deploy, and I think that’s good and we’ll be doing it for many years. But we can’t forget that there’s an investment required to have a stable and secure architecture or infrastructure.

That’s something that I think there’s a temptation, in my opinion in this space, that there’s a recognition and a deference to it, but in organizations that are financially compromised or challenged, it’s sometimes one of those things where people say, “Yeah, I know we need some more servers, I know we need some of these things, but we’re probably going to put that off because we need a new MRI machine.”

Those are difficult decisions, but decisions that are real and get made every day.

If someone asked you to list the three most important things you’ve learned as a healthcare CIO, what would you say?

Be relevant. [laughs] Relevance is probably the top of my mind. Coming from a managing consulting background, I don’t think it was hard for me to understand, but I probably underestimated it, respectfully. It was surprisingly something that I learned early on that can’t be underestimated. I think that that’s significant.

Two, I guess, understand what’s going on. It’s a variant of relevance. I think that one of the most important things that we should be doing is to understand how the operation, how the organization works. If we are to understand the business strategy, if we are to try to align our technology strategy to it, we cannot be irresponsibly neglectful to the operations of the institution.

I think that we have an opportunity or a tendency in the industry simply to look at the business strategy, look at IT high level strategy and just march toward and through it, and we forget what it takes along the way.

So a big lesson learned to me was: a) relevance, and b) understanding. Understanding, connecting all the dots, and not just the top two dots.

That was two, right?

That was two. [laughs] You need a third?

If you don’t have a third, that’s OK. [laughs]

There are so many. I think, communication. Being engaged — it’s all part of relevance. Relevance to me is such a broad and important topic that it covers these other things respectfully, variations of it. Yeah, I think I’m going to hang with my top two.

Anything else you’d like to share? Any wisdom?

I don’t know about wisdom. [laughs] I’m just a simple CIO, right? I think that it’s an extremely exciting time; I think that we all recognize it. The good news is, in light of the healthcare reform in ARRA, it’s shining a light on the topic that I think many of us have implicitly understood as needed, but we’ve struggled with one of the number one barriers, and that is cost. ARRA doesn’t make that go away, but it certainly greases that conversation, right?

I think that’s great. It’s a wonderful time, it’s a perfect storm. I hope we get it right. We are in an interesting time where it’s directionally correct, if I may use that term, where we understand how healthcare reform has to happen and it’s not something we should wait for forever to materialize.

Technology is important to the space in achieving its local and national goals relative to quality and safety outcomes, and certainly some level of fiscal responsibility around the space.

So it’s directionally correct, but the devil is in the detail. I hope that we find an effective balance between our drive and our desire to move forward as quick as we can in light of what we haven’t done, in the last 10 to 20 years, but yet I hope we don’t do so in a way that doesn’t take into account the necessary details that really need to be thought through.

That’s the tricky balance that I think, respectfully, we as an industry and the government has to reconcile. We all know good strategies that were directionally correct but got caught up in the mud and didn’t go anywhere, and we’ve also seen directionally correct strategies take off significantly without the appropriate — not vetting, but appropriate balance of reality.

This is so important not just to our healthcare ecosystem. It is almost a fifth of the economy. We’re talking about a significant element to who we are, that the stakes are so high that finding an effective balance is so critical. I think in the short term measured in months, call it six, and in the long term within the next three to five years.

I personally have a high confidence level in John Glaser and others as a former customer, and certainly as a colleague, who’s such a good rational thinker. I just hope that our governmental process gets it right.

After our interview, Dell announced its expanded presence in the PM/EMR world. It turns out Tufts was instrumental in helping Dell (and eCW) develop the basic framework for Dell’s offering. We went back to Bill and asked him if Tufts is working with any major corporations in developing their EMR strategies.

To summarize Tufts’ role, about a year ago Bill approached Dell and asked them to assist with the deployment of EMR to their community physicians. Though Dell and eCW already had a relationship, Bill brought the parties together to discuss how everyone could work together to create a new delivery model that would benefit the health system, the physicians, and the vendors. The health system lacked the resources required to provide physical support, including helping physician offices with infrastructure assessment, design, hardware procurement, deployment, and support.

Dell was interested in expanding its footprint in healthcare, especially on the services side. eCW’s expertise is software and not hands-on support.

In the end, Tufts established a support model that does not require an in-house help desk, but relies on Dell for physical support and eCW for software support. Bill anticipates the model will save 5-10% on support costs over five years, compared to providing services in-house or through a boutique vendor. Based on the success of the initial pilot installation with Tufts and ECW, Dell further tweaked its healthcare strategy into the model announced this week.

News 9/16/09

From Herb Alpert: “Re: Eclipsys. They are designating three business partners that will replace their own professional services people. Eclipsys is emphasizing speed-to-value, pushing cookie cutter implementations. They listed the partners last week on their Partners page, but appear to have removed that page from their site.” I know that Orchestrate Healthcare picked up some of their people and used them on their SCM/eLink project at UC Irvine (someone from there told me).

From Roger Dodger: “Re: videos. These hit the big vendor mentality on the head.” The animated videos are pretty funny (Video 1, Video 2). Guess along with me which vendor the animated CIO is talking about. “Our front-end processes blow and your 1970s-build application is the problem. The competition is killing us with ease of access and the payors are denying every claim we send them. When is your effing next generation system going to be ready?”

From William Faulkner: “Re: Epic. I can tell you without much discomfort that expectations are high and few places give 20-somethings this much autonomy. I have truly enjoyed working for one of the two hottest companies in one of the hottest industries despite little healthcare experience. The employment structure is incredibly flat, so high turnover and burnout have put five-year vets in fairly senior positions, which keeps new hires motivated. KLAS is king – I must have seen our KLAS ratings 15 times in training. Everyone does get an office, in my case fully equipped with an office mate.”

From Been There, Done That: “Re: Caymans. It’s been a while since I heard of Cayman Island Healthcare! At one point, the old CIO from U of Miami was ‘consulting’ there and bringing in his old friends from Cerner.” Brand new CIO Dale Sanders posted a comment to Monday’s post, so I e-mailed to ask him for an update. Nothing heard so far, but I’m sure he’s busy.

The Health IT Standards Committee submits its recommended EHR privacy and security standards. The initial set is basic, but by 2013, EHRs would be required to use HL7 BRAC role-based access control, security assertion markup language, and WS-Trust for secure exchange of Simple Object Access Protocol messages.

Several new events were added to the HIStalk Calendar (and you can add yours for free, of course). Among them is a September 22 free Webinar entitled Understanding State and National HIT Policy, sponsored by eHealth Initiative and featuring John Glaser.

Weird News Andy likes this story detailing Medicare’s stance on buying assistive technology for patients with speech problems. They will buy an $8,000 desktop PC whose only function is generating speech from text, but not a $150 iPhone app that does something similar. Personally, I’m riding the fence here because I keep remembering those “free scooter” commercials that beg any Medicare recipient with any kind of walking problem to get their sporty ride, courtesy of taxpayers. And if it’s that great of a device, maybe patients should spend their own money on it instead of relying on Medicare to cover every little thing.

Retired hospital CEO and current hospital consultant Ronald Gade, MD joins the board of Doctations.

Hybrid EMR vendor SRSsoft is named to the Inc. 5000 list of fastest growing private companies in America.

Newt Gingrich does a video pitch for StatCom, remarkably coincident with StatCom’s ponying up big bucks to join Newt’s civic-sounding yet entirely for-profit Center for Health Transformation.

IASIS Healthcare implements Sentillion single sign-on in seven of its 15 facilities, yielding a 60% reduction in password reset calls to the help desk. They say they’ll have all 15 running by the end of the year.

Inga and I thought it would be interesting to get a look at eClinicalWorks from the customer perspective, so she attended their user group meeting in Las Vegas this week. Her updates are on HIStalk Practice: #1, #2, #3, where she also covers some eCW announcements, including opening some new offices.

Speaking of eCW, Children’s Boston announces that its Indivo/MyChildren’s PHR will bring in data from both the hospital’s Cerner system and the eCW system used by its physician group. It will use eClinicalWorks Electronic Health Exchange.

Athenahealth announces its guarantee that physician users will be able to quality for HITECH incentives, offering them six months of service free if not. The announcement covers in some detail the complex corporate accounting that’s required to offer something like that, which is interesting in itself. Jonathan Bush quotes Malcolm Gladwell in saying it takes 3% to reach a tipping point, so he’s hoping the program takes the company over the top.

Swedish Medical Center (WA) takes an equity position in 72-doctor multi-specialty group Minor & James Medical, citing their belief that healthcare reform will require cooperation beyond having hospitals simply buy practices. The local newspaper article speculates that the group will move to Swedish’s Epic system, which sounded possible if not likely when I interviewed Swedish CIO Janice Newell a couple of weeks ago.

I visited my doctor recently and have to say I was impressed with the practice’s EMR use. He conducted the whole session with both of us looking at the monitor, walking me through labs and meds (sounds simple, but it was amazingly effective and the display was great even on his puny 15” or so monitor). He mentioned that he would never put a keyboard or monitor between him and a patient, which was cool. I had a sleep study done awhile back and he pulled up the on-screen transcription from the polysomnography people and walked me through their findings. I needed a prescription refilled and he shot that off electronically, saying he was a big fan of e-prescribing, especially for drug interaction checking. The practice is just starting to use speech recognition, which he seemed to like, and also templates, which he seemed to hate (he said he refuses to use them because they create reams of worthless junk data in the EMR). He likes his EMR, I’m in fine health, and we’re both happy. He also said he would definitely get the H1N1 flu shot when it comes out, just in case you’re waffling like me.

A Buffalo group gets a $1 million grant to develop a data sharing pilot project.

Spacelabs announces its Sentinel cardiology information system.

The West Virginia Health information Network delays its RFP for creating a statewide HIE as it figures out how stimulus money and meaningful use definition could change its plans. The new date is November.

Odd lawsuit: a hospital stages a fake pharmacy stickup as a drill without telling employees. A pharmacy technician is suing the hospital and its parent company for false imprisonment, claiming the drill’s aftermath required her to have ongoing therapy for depression, anxiety, panic disorders, post-traumatic stress syndrome, and emotional distress.

E-mail me.

CIO Unplugged – 9/15/09

The views and opinions expressed in this blog are mine personally, and are not necessarily representative of Texas Health Resources or its subsidiaries.

The Politicalization of Health Information Technology
By Ed Marx

Admit it. Health information technology (HIT) deployment is headed nowhere fast. Despite the evidence and supply side rhetoric, demand wanes. Depending on whose study you believe and their definition of HIT, industry adoption of CPOE is languishing in the low teens at best. We can do better for our patients.

Before we dive in, I want to acknowledge the Office of National Coordinator for Healthcare Information Technology (ONC). The National Coordinator plays a central role in how information technology transforms our care delivery system. The leadership is strong, and the Office is blessed by a greater level of funding and authority than in the past. ONC is the principal Federal entity charged with coordinating nationwide efforts to implement the use of the most advanced health information technology, including the electronic exchange of health information. The position of National Coordinator was created in 2004 through an Executive Order and legislatively mandated in the Health Information Technology for Economic and Clinical Health Act [HITECH Act] of 2009.

Next to the ONC, the Centers for Medicaid and Medicare Services (CMS) is another powerful division of the Department of Health and Human Services (HHS). The CMS mission is “To achieve a transformed and modernized health care system.” A key tool for success in their workbench is leveraging information technology. CMS, a professional bureaucracy, was clearly the driver for federal HIT direction and investment until recent legislative changes codified ONC. The ONC and CMS will need to work in concert, finding unity of command and vision, in order to achieve their unsynchronized goals.

Complicating the situation is the legislative branch attempt to control healthcare reform and policy via HIT. On one hand, you have ONC laying out a firm HIT direction; they have the necessary framework, but it’s juxtaposed to the quagmire of healthcare reform. Congress and the white house are materially on different sides of what to do, when to do it, and how. The only certainty is that HIT will be a key component. Unfortunately, due to the lack unity of vision and clarity of goals, HIT is quickly becoming a political lever. And that scares me. HIT is the means, not the end.

Morphing into a government program, HIT could rank with cash for clunkers. We’re incentivized to turn in the old and adopt the new. Although I’m a serious advocate of care transformation via IT, I fear that the motivation is becoming more political than substantive. Where the cash for clunker strategy is a onetime event, we should be investing long term (10 plus years) in HIT and looking for sustainable advocacy with demonstrable support. Incentives are misaligned.

We need to push for challenging meaningful use criteria. What started out provocative and game changing has since been watered down to a welfare-like program. The bar is set too low. Everyone qualifies!—which means we’re not demonstratively leveraging HIT. Instead of reaching high, expectations are lowered, thus removing the incentive to progress materially.

Advocacy groups. Although active dialogue is essential and everyone deserves a seat at the table, too much politicking will derail HIT. Potential is lost in the quagmire of uber engagement, and special interest groups tend to lower expectations and standards. Each group claims to represent a large number of constituents, but at the end of the day, hospital leaders are the ones who will need to make the tough decisions, and execute.

While I appreciate the private/public approach to forming advisory committees, we must intentionally set aside our personal biases to favor the common good. If you look closely at the outcomes derived thus far, you can trace the DNA back to some of the participating organizations. I face the same challenge at the State and City level. It takes a degree of maturity to set aside personal thoughts, prejudices, and organizational goals to pursue the common good. Keeping the patient benefit foremost in our minds will yield the best outcome.

What can we do to help ensure ideal outcomes and prevent the politicalization of healthcare information technology?

• Actively support the ONC leadership.
• Contact senior staff of the House Committee on Ways and Means.
• Contact senior CMS leadership.
• Advocate for more meaningful meaningful use.
• Provide feedback to advisory committee members and pushback on tailor made recommendations that may be of a minority interest.
• Lead by example by ensuring your organization is ahead of the curve.
• Actively participate in your region and state HIT efforts.
• Keep pressure on for healthcare reform

Do it while we still have the freedom to make these choices and influence government decisions.

Ed Marx is senior vice president and CIO at Texas Health Resources in Dallas-Fort Worth, TX. Ed encourages your interaction through this blog. (Use the “add a comment” function at the bottom of each 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.”

Healthcare IT from the Investor’s Chair 9/15/09

Thanks to all who commented on my earlier posting, I appreciated all the feedback and look forward to an ongoing dialogue here courtesy of Mr. HIStalk and the lovely Inga. I’ll compile all questions asked and answer one or two with each posting in addition to my current topic.

With the recent stock market recovery, companies are once again going public (or, as they say on the Street, “the IPO window is open”). Emdeon returned to the public market with a successful IPO in mid-August and Healthport recently filed its prospectus with the SEC. I’ll sound off on both of those shortly, but I’m sure some might appreciate a plain English translation of what I just said along with how it happens.

Following my last post, Healthfreak asked, When does an investment banker tell a company to go in for an IPO or plain loan from a bank?

First, traditionally there were two types of banks — commercial banks (loans) and investment banks (IPOs). Both did much more, of course, but the Glass-Steagall act signed in 1933 drew strict firewalls between the two. While Glass-Steagall was repealed by the Gramm-Leach-Bliley Act of 1999 (and we can see what fun that led to in the financial world of late), let’s assume it’s still in place as different bankers within the a larger bank that offers both services still do different things.

Why would a company go public? It’s expensive, intrusive, and, as the leadership of such companies as Epic, Meditech, or eClinicalworks would likely attest, requires a dramatically increased focus on short-term results over potential long-term benefits. Not to mention it means anyone with a Web browser can learn what senior management is paid.

Companies typically go public for two reasons: they need the money for corporate purposes (such as developing a product, expanding a sales force, or making an acquisition) or they want to provide liquidity to investors or shareholders. Microsoft, for example, never needed additional capital, so its IPO was to allow its employees and founders to ultimately sell stock. Even if existing shareholders aren’t selling stock in the IPO, part of the goal is to create liquidity and a marketplace so they ultimately can, be they founders, employees, or investors.

A loan makes more sense if the company needs growth capital and has, importantly, a business that will generate sufficient cash flow to ensure the loan’s repayment, and if the owners don’t want to give up any control by selling stock. In the case of, say, a biotech or early-stage software company, the business is perceived as too risky to loan to, but is often financeable, as equity investors will take on significantly more risk (in exchange, of course, for significantly higher return potential). Incidentally, the economics of running IPOs are inherently more attractive than loaning money, hence the spate of commercial banks buying investment banks — Citi, Bank of America, and Chase, to name a few.

What’s the process? It typically begins with the company and its board of directors selecting the underwriting team (aka, “syndicate”) by conducting what is fondly known as a “bake-off”. This is a grueling ordeal for both sides, where the company invites a large number of investment banks to come pitch for the business. The banks are often pre-screened based on the firm’s reputation, the quality of the research analysts they have covering the space, and how successful the bankers have been at showing love to management and the private investors.

Bake-offs consist of 60-90 minute sessions during which a team of bankers from each firm parades through the company’s boardroom and explains, through dramatic interpretation of huge PowerPoint decks, why their firm should be part of the underwriting team and, ideally, lead the process.

In an act that has become almost ritual, each bank comes in and presents their firm’s credentials and skills in taking companies public as well as which buy-side accounts they would expect to participate in the wonderful stock offering. Each firm has, in effect, the same map of the country with the same mutual and hedge funds highlighted and talks about their special relationship with the buyers. “But we’re not here to talk about ourselves, we’re here to talk about HIStalkCo” the senior team member says (typically the more the merrier in these meetings, as it shows the prospective firm’s view that this is a client worth dragging senior people across the country for).

The bankers then drop to their knees to talk about what a wonderful company HIStalkCo is (“transformational” and “game-changing” are always good words) and how they would position the story to prospective investors. Prior to Elliot Spitzer’s intervention, this part was done by the research analyst, but subsequently, the bankers have had to play that role, with varying degrees of success.

Next comes the part the investors really care about: stating just how much the bankers think the company is worth.

Here’s where people lean forward. As I shared in an earlier post, stocks trade on their earnings potential and so the company has already shared its projections with the bankers to help them prepare their valuation analysis. I’ll note that at this point one assumes that management’s projections are gospel and (at this point) never challenges them.

(Incidentally, everyone seems to ignore the fact that management’s projections rarely see the light of day — prudent analysts always “haircut” management’s forecasts to help ensure the company can actually achieve them, and valuation is ultimately driven off those projections.)

To predict value, the bankers define a “comp group”, a peer group of similar companies with similar characteristics. The assumption is that similar companies will trade at similar multiples of earnings / revenues / EBITDA, and it’s not an unreasonable assumption. Of course HIStalkCo will trade at the high end of its peer group, so one assumes a similar forward price-earnings multiple and then applies a 15% “IPO Discount” to reach your best guess of the likely value of the stock once it’s publicly traded. The reason for the IPO discount is that portfolio managers need to be compensated for taking the risk inherent in an untried stock. For some reason, it’s always 15% — I’ve often wondered why (perhaps it’s like 186,000 miles per second or other laws of nature).

The fun part in valuation, however, is choosing the comps themselves in such a way as to maximize the predicted value. Everyone wants to hear their company is worth a huge amount, so this is where it gets laid on the thickest. Every software-as-a-service (SaaS) company is comped to salesforce.com. Every HCIT company is comped to athenahealth or whoever the high flyer-du-jour happens to be. Desperate to win the battle of the value, some bankers were comparing Emdeon to Mastercard to goose the expected value — after all, they both process transactions!

It astounds me that companies seem to give so much credence to this part of the presentation, because picking an underwriter based on their take on value is like picking a realtor based on what they tell you your house is worth. As I’ve said in more than one pitch (stating the obvious), it’s the buyers that will set value here, not the bankers.

After all this bragging, positioning, discussing the marketing plan, and valuation, the board room has become a bored room and it’s time to thank the bankers for their thoughtful work and invite the next group in. Then, most likely, hear a presentation that has 90% overlap with all the rest. Finally it’s time to chose the lucky team and move to the next phase.

Time to start writing the prospectus? Sorry, there’s still the happy task of informing the winners, consoling (and justifying decisions) to the losers, and then dividing the hoped-for spoils of victory. Companies, in effect, typically pay the underwriters 7% of the offering proceeds. For a $200 million IPO, that means there’s $14 million to go around. How it’s divided is, as you’d expect, is topic near and dear to everyone’s hearts.

IPOs have a lead manager who typically does most of the work — running drafting sessions, coordinating diligence, scheduling investor meetings (the “road show”), taking orders from accounts, and ultimately setting the price. Not unreasonably, they want a good chunk of the fees for those services — sometimes as much as 70% (way too much, IMO).

There’s also some prestige associated with it. Lead-managed deals are tracked and give bragging rights, so the phenomenon of “co-lead managers” emerged. After negotiating with the lead (aka, bookrunning manager) on how much they get, the company needs to divide what’s left with the co-managers. Each co-manager will insist that they need more — for fairness’s sake, to “motivate the organization to pay attention to the deal”, or due to precedence.

Start writing? Not yet. Besides how much they make on the deal, the banks also care about what order they appear on the cover as that’s another source of prestige and bragging rights. While names on the prospectus cover are first set by order of how big a share of the underwriting the banks receive, after that, it’s due to “precedence”, and it really matters to the banks.

(Please don’t laugh — in my banking career, I’m sure I spent literally hours pleading for a better placement on various prospectus covers even though there was no extra money involved. I even had junior bankers research the vaunted precedence to prove that William Blair was listed under B, not W, and my counterparts no doubt did the same to prove the opposite! Why do the banks care? Candidly, I always wondered.)

Now that the underwriting team has been chosen, we’ll take a short break and my next topic will take us from the organizational meeting through pricing the deal and beyond.

In the mean time, RustBelt Fan asks, What are the signs and symptoms that my vendor is being shopped for buyers?

Ideally, there should be none. Part of a banker’s job is trying to minimize the potential of a leak. As you can expect, that’s a challenge, as information exchange is the lifeblood of the Street. However, while investors and companies might find out, it’s much harder for customers and employees to learn it.

I first encountered HIStalk a number of years ago when a client of mine whose business we were selling called us on the carpet for allegedly leaking information to Mr. HIStalk. The blog had almost perfect information about the process. I confessed with embarrassment that I’d actually never read it (nor had any of my colleagues). But, needless to say, I started reading it then.

Bottom line, RBF — in a skillful process, you rarely can tell. But remember, where there are outside investors, there’s an ultimate need for them to get liquidity in their investment, either through a sale or IPO. Whether you’re talking to a potential vendor or employer, I don’t think asking about investor plans, or, in fact, the state of the company’s balance sheet, should be taboo. As a customer, you’re making a commitment to a vendor, and while a sale of the company might not impact it, hearing what the vendor says can never hurt. Just keep the grain of salt in mind, as they’re often not able to predict what investors will want them to do.

Ben Rooks is the founder of ST Advisors, a strategic consultancy offering long-term and project-relationships to companies and financial sponsors. He earned an MBA in healthcare management from The Wharton School of the University of Pennsylvania, has done healthcare IT equity research, and has worked as an investment banker in over 25 successfully closed healthcare and medical technology transactions valued from $40 to $365 million.

Monday Morning Update 9/14/09

From Ex-Cerner Guy: “Re: Cerner. Not only does Cerner re-sell the data they collect, but it’s part of their Lighthouse agreement and the client gets to pay for the privilege of giving their data away. Look closely at the wording of the agreement — it’s in there. It’s good to read their contracts closely. It’s more fun to sit in on the negotiations and watch the squirming.”

From The PACS Designer: “Re: Govt 2.0 Summit. Tim O’Reilly, of Web 2.0 fame and founder of O’Reilly Media, had some interesting comments at the Gov 2.0 Summit about turning government into a platform to foster true innovation in the years to come.” Tim’s got some shopworn analogies about the iPhone and Twitter in case you haven’t had enough of those, making the point that third-party products should plug into the “government platform” to build citizen services, no different than the Interstate system and the Internet (oops, more analogies). All I could think of was the cool movie Startup.com that documented the quick ride up and equally quick ride down of Govworks.com, which was going to make the founders zillionaires by allowing people to pay parking tickets online. Where were you during the dot-com wars?

From Needs_Gas: “Re: Eclipsys. A recruiter says they have a new model and will be partnering with third-party firms to provide services.” Unverified.

From Luke O’Scyte: “Re: anonymization. There is no such thing as real anonymization any more due to the science of re-identification. You can uniquely identify 87% of Americans with only zip code, date of birth, and gender. Release of such information by companies like Cerner should not be allowed.” I’ve covered that topic before, but it’s worth another mention: all you need is a second database that state or federal governments sell cheap and you can re-identify most of the records in a “de-identified” set. Luke sent a link to a fun article describing a well-intentioned 1990s mandate from Massachusetts state government to release anonymized data covering state employee hospitalizations, which sounded great until a grad student mailed the medical history of the governor to his office. She had easily obtained his full record of his diagnoses and prescriptions by matching the anonymized employee data to a voter database she bought for $20. Only six people in Cambridge shared his birth date, only three were men, and only one (the governor) lived in his ZIP code. That grad student was Latanya Sweeney, now a noted Carnegie Mellon professor and privacy technology expert.

The Conficter worm shuts down takes down all hospital information systems in the Cayman Islands. What’s most interesting about the story, though, is that the article quotes new CIO Dale Sanders, who has been on the job less than a week and who, until recently, was CIO at Northwestern Medical Faculty Foundation. I’m interested in how he ended up there since that sounds like a fun move. I’ve been to the Caymans several times and my impressions are (a) it’s beautiful with stunning green-blue water great snorkeling; (b) it’s also horrendously expensive and has a bad exchange rate on the US-to-Cayman dollar, and (c) it’s an international haven for tax-dodging corporations and shady banks (was that redundant?) whose physical presence is a post office box. Oh, and it has a turtle farm and rum cakes.

Opinions about working at Epic are mixed on Job Vent, which is always entertaining as well as hardly reliable. General observations of those posting: (a) they hire only easily controlled new grads of any major; (b) job evaluations and promotions are based only on hours worked; (c) if you quit to work for a customer after the mandatory one-year waiting period specified in the contracts of customers, you are an untouchable who isn’t allowed to interact with current employees; (d) the money, benefits, and the non-cubicle environment is nice for new grads. Some of the posters claim a 1984-type environment where employee conversations and Web activity are monitored, warning of the “thought police.” One pro-Epic cheerleader claims, “We hire scary-smart people, so if they can’t cut it at Epic, they will still be a rock star somewhere else” which maybe means in a different industry since 22-year-old philosophy grads with zero work experience of any kind aren’t exactly in high demand in HIT. As a capitalist, though, I like the model: pay a little more than you have do, bring people to a location where they have few career alternatives, demand more than you should expect, proclaim cheap meals and snacks a benefit instead of a way to get extra hours out of employees who might actually leave for lunch otherwise, keep enough quirk on hand to fool wide-eyed noobs into thinking that wintry Wisconsin farmland is a hip Silicon Valley Midwest, and keep a big file of backup resumes to feed the churn. It’s working for Epic and, greenhorns or not, they innovate more than their competitors.

Cerner will hire 12,000 new employees by 2020, Neal Patterson says to the government of KCMO to soothe the civic feathers he ruffled by choosing the Kansas side of the border for his soccer and HIT complex.

Thanks to Kronos for becoming an HIStalk Platinum Sponsor. The Chelmsford, MA company offers a wide range of workforce management systems that optimize the cost of delivering quality care, minimize risk due to noncompliance with requirements, and maximize productivity. Some of its applications include timekeeping, human resources management, payroll, workforce analytics, employee scheduling, and absence management. They have several research and case study papers on their site. My thanks to Kronos for supporting HIStalk and its readers.

Results from my poll about vendors notifying customers when their software has patient-endangering problem: 37% said their vendors were bad about that, 39% said mediocre, 25% said good. New poll to your right: how much impact will Dell have on the healthcare IT market now that it will offer EMR hardware, software, and services?

I like this idea: an online debate on whether to implement CPOE vs. barcoded medication administration first. It features two highly regarded pharmacists with informatics expertise. 

I think I may have joked before that RHIOs might as well try for ARRA grants as regional extension centers since they often don’t have a business model otherwise. Apparently it’s no joke: the Harrisburg Health Information Exchange (PA) submits its grant request. 

Another reason to ignore stock analysts who cover industries they clearly know nothing about: this article covering Dell’s announcement about reselling EMRs is full of eye-rolling inaccuracies: (a) the headline says Dell will “make” electronic records; (b) it calls EMRs “the device”; and (c) it opines that Dell’s big competitors will be Google and Microsoft, apparently confusing PHRs with EMRs.

An odd lineup on yesterday’s CBS News Sunday Morning: “Dennis Quaid discusses electronic medical records; the end of ‘Guiding Light’; poetry; upcoming fall films.” Dennis’s G.I. Joe did great until word got around, disappearing without a trace after three weeks. He’s up next in the sci-fi (or is it Syfy?) thriller Pandorum, which opens September 25. The trailer looks lame to me, but my taste varies considerably from the apparent mainstream.

Merge Health extends its agreement with Russian medical equipment vendor Rossyln Medical, which will integrate Merge’s PACS technologies into its custom solutions.

E-mail me.

HIStalk Interviews Avery Cloud

Avery Cloud is CIO at New Hanover Regional Medical Center in Wilmington, NC.

Tell me how your Project S is structured, what it’s designed to accomplish, and your thoughts on portfolio and service management.

Project S is exactly that. It’s a service management initiative in disguise. I’ve tried to move away from this idea of talking in a language that means nothing to my customers. We basically took service management concepts and repackaged it into something that was explicable and digestible by our audience.

What created the need to do this in the first place was an analysis of where we stood and our ability to meet service levels or to create customer satisfaction, also to build an infrastructure that would support the coming strategic initiatives that we saw down the pike.

For example, we’re moving rapidly into full-function EMR. We knew that we have to have a structure that supports remote ambulatory care environments. We have to have different service levels for that.

Analysis showed that we just weren’t set to work quite ready for that. We had a maturity study done and we had about a 1.2 level maturity against a maximum of 5. It also revealed that we need to move somewhere around a 3.2, 3.3 maturity level in order to provide the kind of services that would be required to make our organization successful. That gap represented the tools, skills, policies, standards, procedures that are necessary to deliver high levels of service.

Our goal was to create stability: stability in our systems, stability in our service, stability in our satisfaction levels. That’s four Ss and that’s how we coined the term Project S.

Is the maturity level you mentioned CMM or is there something other that you measured that with?

IBM has a customized version of ITIL. They have a service level maturity or service maturity index.

How rigorous and involved was it to get that number back to tell you where you stood?

It was pretty rigorous. It was about a two-month-long analysis.

You got some help from Compuware in putting this together. What did you find you were lacking in terms of knowledge and abilities? Were there any new things that they insisted you bring to the table that you didn’t already have in your shop?

That’s a great question. One thing we lacked was a repeatable process. That’s where adopting ITIL came to bear.

Another we lacked was skills in the right areas. We had plenty of skills, but not necessarily the presence of the right skills for the right job.

We were also lacking tools. Tools essentially mean that we weren’t in a position to automate ourselves so that we could provide higher levels of service. As you well know, you can’t do everything in a manual fashion and be efficient and effective.

Those will be the areas that pretty quickly emerged, and that’s what led us to an analysis of what our toolkit should be.

We believe in the idea of integration. Integration is something that is quite absent in many IT organizations. We tend to be the worse, we’re much worse than our customers when it comes to buying one-off tools for every problem. What we try to do is buy an integrated toolkit that helps us run the business of IT.

That, in fact, was our mantra. We wanted to manage IT like a business, and therefore put in the business systems required. A good example is that we wanted to mimic our financial department, financial and HR. We have one product that manages finance and HR, and that’s Lawson. It has materials management, and then it has payroll, it has financial reporting, accounting, general ledger — you get the drift. It’s a well-integrated product which redoubles its ability to produce efficiency than if you had individual products for each of those foci.

We wanted to help this integrate into one product set, our monitoring initiatives or monitoring processes, our early detection and warning processes, but also our project management, change management, problem reporting, our time management, our budgeting process, our IT governance reporting process, our automated workflows.

That was really important to us. The system lets us embed the knowledge of experts and the systems, therefore driving a repeatable process. I said a mouthful there, covered a lot of territory, but I hope you get some sense out of that.

I don’t want to ask you what it cost, but how much of an effort and investment was it to move from where you were to where you are?

It’s probably the biggest thing this IT organization has approached since its inception.

How did you get the support to undertake such a project in these times?

It was simply outlining the gaps between customer expectations and our ability to deliver and matching a solution to those gaps. The organization wanted those gaps filled enough that the sale was much easier.

It’s kind of interesting. I had to highlight my failures, [laughs] which really is a risky and uncomfortable approach, but in fact, it is the right thing to do. I had to highlight the fact that I had a 30% drop call rate at the help desk. I had to highlight the fact that nine out of 10 problems that we encounter are called in to us by our customers rather than us notifying the customers of the existence of the problem. In other words, they find it before we do.

So you begin outlining all these things, and then you start talking about what’s coming in the future, and you’re going to have doctors who are going to need the services of that help desk with that low performance. You’re going to have doctors who don’t want to have their systems to fail when they’re in the middle of a surgery. You’re going to have nurses that can’t administer medications to patients in pain if the barcoded med system is down.

We were able to use kind of Walt Disney’s “imagineering” approach, just tell a story about how things are and how much better things could be.

ROI was not as necessary when you looked at it that way, because when you really looked at it, the case we were making was a case of staying in business. [laughs]

Overall, is the end result that you have restructured the department and changed the staffing mix and staffing levels?

Yes. We’ve done two substantial re-orgs through this process, continued to evaluate our staffing plans, and brought on a chief technology officer. We made some major staffing changes, major training changes. Our organizational processes don’t even resemble what they used to be.

If you’re talking to your CIO peers, what would you tell them is the key to know that you need to have this done and the thoughts to entertain before they start?

I think, you know, customer’s king. The key is to evaluate the customer’s level of satisfaction with services being provided. You can’t do that without getting very involved and face to face with the customers. So that’s number one.

Also, the study of where your organization is going is vital. You’ve got to forecast what are the strategic demands coming into your organization, and what are your current abilities to support the future.

One of the things I’ve said quite often in team meetings is we have to future-proof IT. We’re not future-proofing it against outside attack; we’re future-proofing it against internal demand. The whole idea is to create an IT organization that is not a constraint to business decisions.

Did the evaluation find that the IT department was underfunded?

Oh, yeah. There were some adjustments made there also. Probably another way to look at it is funding is not in the right places. It was not just underfunded, but the distribution of money and funds — are we spending our money on the most important services and problems?

How much larger did your operational percentage of total budget need to be to meet these standards that were laid out in the evaluation?

Let’s see … what was that percentage increase? I don’t want to guess at it. Suffice it to say that it went up modestly. [laughs]

And you had that commitment going in, knowing that there were things to be accomplished that might cost money, that the folks writing the check would say, “Yes, we’ll buy those recommendations and fund them?”

Right. You have to prepare an organization to accept that. Obviously, marketing the project as goals and describing what it takes to meet those goals helps prepare an organization for an additional cost.

I believe we really did an excellent job on not making those costs burdensome. If you really look at our budget, we have stayed at just about the same expense percent revenue. It has gone up slightly, but not enough to sound alarms. [laughs]

What are you doing to establish relationships with your physicians?

One of the things we’d done is strengthen our governance process. We have a group of physicians that are integral to our governance and decision making to represent physician needs. We’re also looking for better support models for docs. We know service levels required for docs are far different than anybody else in the organization. They don’t have five minutes to hang on on the phone.

We’re looking for easier ways for them to communicate to us that there is an issue. They might want to simply let us know one of the keys is sticking on a keyboard. You’ll never hear about that from them because they’re far too busy to stop and tell you if you don’t make it easy for them to do that. They’re not going to pick up a phone because they don’t like being put on hold.

All those things we’re doing from a clinical perspective. We continue to enhance their portal. We make that their one windowpane to clinical information, or one pane of glass to clinical information is what I’m trying to say. We continue to enhance the speed, we set service level agreements for response time on the full transactions that represent 80% of their work. We are spending a lot of time right now prepping up for computerized physician order entry. That’s going to be a big one for them. Those are the big things.

In summary, the two most important things if you were to ask a doc is that the systems fail a whole lot less, and they run a whole lot faster.

Are you doing anything specific to stimulus funding?

Yeah. CPOE is going to be part of the “meaningful use” definition. We’re working with our physicians not only in the hospital, but with community docs that are affiliated with our hospital, and even extending our reach to all the counties that we serve, and collaborating with other hospitals and their physicians to start talking about health information exchange and how we can better share information, and how we can help them achieve the maximum stimulus dollars available.

What kind of things are you doing with the physician practice EMRs and practice management systems? How are you tooling up to get them prepared and to get your integration strategy with the doctors going?

Boy, I tell you, it’s essential to have a meeting before we talk about that. [laughs] It’s probably one of the more interesting things I get to spend my time on.

Anyway, here’s our strategy in a nutshell: we are going to standardize on one system, one physician EMR that we will recommend, and we will pre-build any necessary interfaces back to our hospital systems. Therefore, if a doc agrees to select that system, and of course we can’t make them do it, but if they agree to select that system they know that they automatically are going to be joined in the information sharing with the hospital.

This is also where HIE comes. We are looking for our own kind of mini-HIE for docs that might not agree to purchase that particular system, and at least provide some way for them to participate in information sharing with the hospitals that they have admitting privileges to.

We’re differentiating very clearly between docs that we employ and docs that we have affiliations with, and trying to provide those two levels of service. We’re really trying to work out the kinks on what is going to be our support model. Are we going to be the ASP, or is there going to be a vendor ASP involved? Might there be a hybrid model? There’s still a lot of unanswered questions, but we are right in the middle of trying to sort all of that out right now.

What would your credibility have been before you did Project S as opposed to now?

They would have run me out of town for real. Don’t you write that. [laughs] They would not have even considered it because our service levels were so abysmal that there was no confidence. There was a crisis of confidence in our physician staff with IT. Rightfully so.

What had happened was the needs of the organization had grown faster than the IT of the organization’s abilities to support those needs. That’s not unusual. That is the reason you have these clearly defined and measurable maturity levels for IT organizations, because you have to match up your IT organization’s capabilities with your internal customer’s demands.

Last question. If you look back at the last couple of years, what are the smartest things you’ve done as CIO?

What a great question. Smartest thing I’ve done as CIO … probably dealing with IS as an internal business. Allowing that perception to govern how I make decisions helps me make the right decisions. That would be one.

Another one would be taking no prisoners when it comes to hiring the best. I’ve got to have a team of people who better and more ideas than I do. I want to be the idea vetter, not the idea creator. Surrounding myself with good people — it takes a while to finally get that figured out, but if you do that right, the rest of the job gets easier.

In terms of information systems, specific or technical things that I’m proud of — I kind of don’t know how to say this, because I don’t know how to say this and make it print right, but I’ve spent time with a particular vendor and greatly influenced their product direction. We use a product here, a bed management system that a particular vendor and I drew on the back of a napkin, and he turned it into a product. So I’m pretty proud of that. I didn’t get a doggone thing out of it, but I’ve got a doggone good system.

Maybe another way to put it is I’ve always worked very hard to match a technology to a problem, and not just push technology.

I’ve got to share this one, too: putting in strong governance. If you want to succeed, have strong IT governance.

I always liked somebody who’s got a really firm vision on what needs to change without getting so wrapped up in the minutiae like hospital folks so often do, so it’s refreshing to have somebody with a plan who actually made it work, especially when you get into stuff like infrastructure and staffing and IT governance, which is usually kind the Vietnam of CIOs. [laughs] You get wrapped up in all the stuff you really can’t get closure on.

That’s so true. I tell you, my boss and I had a long conversation. He said, “Avery, what you’re very good at is the visioning part of being a CIO,” and he said, “I really like that about you, and what you’ve got to do is make sure that you have a structure around you and manage the details.” Because what happens to a lot of CIOs is they get pulled down into details and never get up the 30,000 feet to see what’s going on.

Is that inherent in their background, though, when you’ve got a lot of folks who worked to move their way up through IT, which is the argument of “are you better off with someone who’s risen through the IT ranks”, or better off to get a visionary who just lets other people worry about the nuts and the bolts?

That’s an interesting debate. I’ll just tell you about me: I came up through the technical ranks. I hold an MBA, but more importantly, I have an affinity to business. When people ask me about me and my job, I tell them I’m a business person who just happens to know IT.

I’d like to think that I could run any of the departments in this hospital. A good example is that nobody is surprised when the CFO runs the pharmacy department, or the CFO runs materials management. It should be no big surprise either that the CIO can do the same, or does the same. A very good friend of mine in another hospital — he’s the CIO there — runs the pharmacy down there. Another friend of mine who’s a CIO runs the home care division.

So a chief information officer is not a propeller-head. A good one is a business person. You think like a business person, and you recognize the importance of your specific trained professional discipline, which is IT, but you don’t let it rule you.

I think there are advantages to having a technical background because it does help you understand when your people are talking to you. I’ve seen the other side of the thing where the person did not come up through the technical ranks. It must be horrifying to be a person who has a strong grasp of the business but has no clue about technology, because the language we IT professionals talk on can be scary.

That’s why, frankly, a lot of CEOs are uncomfortable with IT reporting directly to them. If you’re not the kind of CIO who’s a business person, your CEO is not going to take to you. CEOs don’t want to hear about the bits and bytes and stuff.

I’m going to share this with you real quick. One of my crusades is to make my organization think about what we do from the customer perspective. Don’t tell me that the systems are up 99% of the time. Tell me how many hours you were down, because that’s how the customer looks at it. Don’t tell me that the server 214 is down. Tell me how many patients are getting backed up in the ED. Tell me how many fewer registrations I’m going to do per day because of this. Tell me what my impact’s going to be to the bottom line.

Part of our monitoring effort here is to cause our monitor to tell us what’s happening in the business based on what’s happening in IS. You’re not seeing a whole lot of IT leaders thinking that way, and that’s a problem.

I really want to pick up my phone and say, “You can probably expect a two or three percent decrease in collections today because we have some stress on one of the segments on the network that prevented as many bills going out.” That’s a different phone call than if I called my CFO and said to him, “Just wanted to let you know that your people are going to be a little frustrated because systems are running slow today.”

So I think that is really what IT leaders have got to strive for, the user viewpoint, the user view of the services that IT provides.

News 9/11/09

From Chi Lover: “Re: Eclipsys. Eclipsys is having another round of layoffs today (9/10/09). How can they sustain their implementations with so few staff?” Unverified. Another rumor making the rounds is that Allscripts is thinking about buying Eclipsys, but I mention that purely for entertainment rather than business value since lots of signs point to the likely inaccuracy of that speculation.

From Bobby Orr: “Re: Cerner. I’m disappointed in your thoughts that Neal would do anything that is not motivated by money. Cerner would compile a massive database of patients that could de-identified and sold to the pharma companies for research, trending, etc. Go with the cynical version because it is great business idea that big pharma would be willing to pay big dollars for. The stock is not blowing everyone out of the water because Neal has bad business ideas.” You’re probably right, especially with all the non-proprietary ways the government could get surveillance data (I let my cynicism down for one moment and got busted!) One reader commented on the article, asking how Cerner would deduce H1N1 given that there’s no ICD-9 code for it; another replied that they would simply be looking at ED admissions in which the patient has a temperature that’s a certain amount above normal. If that’s all it does, then it’s worthless.

From Who Pays For EHRs? Patients: “Re: Cerner. People might have forgotten that Cerner already is selling patient data to pharma and there really isn’t any such thing as anonymized data. I guess no one is buying Cerner, so they need to do something.”

From Sr Health Integration Tech: “Re: Cerner’s H1N1 surveillance tool. I believe the CDC already has the capability, known as BioSense. It takes HL7 messages, which are made anonymous prior to transmission, and the aggregated data is analyzed for the region to determine if a ‘biological incident’ exists.” That brings back a memory that UPMC had developed a biosurveillance tool for the CDC or NIH years ago (I remember downloading it). I don’t know if it’s the same one.

From Cal Worthington: “Re: HIEs exchanging data. From what I’ve seen at many of the state-wide HIE conferences being put together to respond to the HITECH act, only the PhD/MDs are salivating over the HIE to HIE exchange because of the research they are doing. Most are professing my patient imperative, ‘the closer to the patient the faster the information is needed’ — which I believe cannot be done in a cost-effective way as you get farther and farther away from the patient’s home turf. However, I do believe that certain CMS, CDC, SSA, and research data could be exchanged in that manner, making reporting a behind-the-scenes activity to healthcare delivery. Once that happens, we’ll get better data without the administrative overhead. HIEs are effective collaboration tools in a community of healthcare providers with significant overlapping patient populations.”

From Mike Mills: “Re: iPhone emergency apps. I bike a lot, so I bought the Road ID, a wrist bracelet with my wife’s name and number and an 800 number and PIN. The system ‘talks’ to the EMT and tells them my name, blood type, any medical conditions, meds I am on, allergies, etc. That is much better and easier than a phone app, easier to find, and they make one version of the wrist band that is nice looking so you can wear it all the time.” Pretty cool for $9.99 a year. EMTs call the phone number or go to the Web page on the bracelet and a text-to-speech app reads off the information.

From Colorado Kid: “Re: Steve Hess. He left Christiana Care and joined the University of Colorado Hospital as CIO.” Thanks to the several readers who passed that info along. I feel like John Walsh for tracking him down publicly.

From The PACS Designer: “Re: wait times. As we digitize more health information, we start to see more innovations migrate to the Web. Middlesex Hospital (CT) is one institution that is going digital in their Emergency Department when it comes to posting wait times on the web for treatments which exclude real emergency situations.”

dbMotion, Allscripts, and Initiate Systems will host a Healthcare IT Executive Summit later this month in San Francisco. The topic is, of course, ARRA, which has dislodged every other topic from every HIT event (maybe HIMSS will be nothing but people talking about Meaningful Use and getting government money). It’s invitation-only, so if you didn’t get one, join the club.

Readers have added quite a few events to the HIStalk Calendar in the last few days, so check them out or add your own events for free (I keep saying “for free” since I don’t think everyone has caught on).

Listening: brand new from Phish, who shows they’re more than spaced-out live jammers. Lots of little 70s prog bits in there. Meanwhile, the music industry’s only possible savior is a group whose last album was recorded in primitive tape equipment nearly 40 years ago, the 50%-still-alive Beatles. Quality really does last, apparently.

Midwest Orthopaedics chooses SRS after taking its free EMR free trial.

Dell gets into the PM/EMR business, offering a sponsored solution to hospital-affiliated doctor groups that can include hosting, HIE services, a monthly lease payment, onsite services such as practice and workflow assessments, and 24×7 hardware and software support. Tufts and Memorial Hermann were early adopters. Partners include eClinicalWorks and Perot. That’s bigger news than the Sam’s Club announcement, I think, since Dell is offering everything for one monthly payment and practices need a lot of support. We’ll have our interview with Bill Shickolovich, CIO at Tufts-New England Medical Center, posted shortly.

The Dell story made The New York Times, which dug deeper to see what other vendors are doing. GE will roll out a hosted version of its systems in a few months, eClinicalWorks has 10 data centers for hosting, athenahealth will announce a marketing drive and technical assistance program within the next three weeks, IBM is creating a cloud-based service for EMRs, and Verizon started a 500-employee healthcare unit that will offer hosting and data sharing.

Construction will start soon in Wyandotte County, KS on an 18,500-seat soccer stadium and a 4,000-employee Cerner office park with 600,00 square feet of office space. The $414 million project, funded by bond money, covers the two organizations that Neal Patterson and Cliff Illig own most of — Cerner and the pro soccer team there. Not shown: the pizza delivery man observation platform atop the giant ticking clock.

The CRIMSON Initiative, a physician profiling system sold oddly enough by The Advisory Board Company who bought the company last year, announces that it’s being used by over 200 hospitals. One hospital CEO is quoted strangely: “If I had the ear of President Obama, I would tell him that we need two things, a national fishing holiday and the CRIMSON application.” He also calls it “a diamond in the rough,” implying there’s something “rough” about it.

The Physicians’ Drug Reference (PDR) is merging with the Health Care Notification Network to form PDR Network, offering the online drug reference and FDA provider alerts. A reader reported in May that something was up with Medfusion and Medem, Medfusion bought Medem’s health services business in July, and former Medem CEO Ed Fotsch is now listed as CEO of the new PDR Network.

The cost to McKesson to provide security to John Hammergren: $402K per year, the fifth-highest cost in the Fortune 100, way more than the cost of protecting the CEOs of ExxonMobil and the car companies.

Rockingham Memorial Hospital (VA) chooses NextGen’s PM, EMR, imaging, and community health solutions.

I missed this: Medicity CEO Kipp Lassetter, MD spoke Wednesday at the Robert W. Baird Health Care Conference.

Who believes this? Delnor Hospital (IL) says it hasn’t had a medication error in 15 months. I guarantee I could snoop around for an hour and find several, although maybe they really meant medication-related sentinel events.

Halo Monitoring announces that its home monitoring and personal alert system can send data to Microsoft’s HealthVault.

Informatics Corporation of America brings on three new regional sales directors for its ICA CareAlign data sharing and portal solution.

The State of Kentucky opens registration for its e-Health Summit, which is Wednesday at the Hyatt in Louisville. John Glaser is on the agenda (warning: PDF) representing ONCHIT.

GE Healthcare announces its plan to develop wireless monitoring systems it calls Body Sensor Networks, replacing hard-wired medical monitors with wireless versions that could be used anywhere in a hospital or at home. The company has also petitioned the FCC to create a dedicated frequency band for low-power, short-range monitoring systems. That sounds like a great alternative to moving patients around in the hospital just to get them to a monitor-covered location.

Insurance company WellPoint apparently has cleaned up its much-publicized software glitches that nearly drove the company out of business, receiving notice from CMS this week that it can resume selling its Medicare insurance plans.

Mediware announces Q4 numbers: revenue up 4.3%, EPS $0.07 vs. $0.04.

E-mail me.

HERtalk by Inga

Fall River Health Services (SD) alerts patients they are converting to Meditech Client Server EMR this week, a change that will allow them to connect with Rapid City Regional Hospital.

The DoD signs a contract with CliniComp to deploy its Essentris inpatient clinical documentation package at 36 additional military treatment facilities.

West Park Healthcare Centre (Toronto), Northeast Georgia Health Systems, and Hunterdon Medical Center (NJ) are awarded 2009 QuadraMed User Excellence in Software Technology awards. The award recognizes success in maximizing operational efficiencies and delivering high quality through QuadraMed technologies.

Weeks after MetroSouth Medical Center hosts a first year anniversary barbecue, the Blue Island, IL hospital lays off 120 employees. Just a month ago the Chicago Tribune reported things were looking up at the former St. Francis Hospital & Health Center. Now administrators are blaming the decline in patients for creating additional financial pressures.

E-mail Inga.

Readers Write 9/9/09

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!

Healthcare Clearinghouses
By Skip Tumalu

You’re asking the right questions about X12 and clearinghouses. The answers, as is sometimes the case with EDI issues, may lie beneath the surface. And bravo for insisting on transparency. But do take the time to investigate, measure and test. Do not let the inability of your business partners to approach transparency trap you into a corner with no exit. Let’s take a quick snapshot of the surface issues and “what lies beneath.”

Eligibility on the surface
Provider transmits data elements per payer requirements. Payer responds with Eligible or Not.

Eligibility underside
The more non-required data elements the provider transmits, the more likely the payer will falsely respond Not Eligible. Why? There was a keystroke or other error in one of the data elements. The data set did not match. Not Eligible. Or, the payer eligibility system is old, cranky, or attempting to comply with governmental program rules and “just says no.” Don’t worry — false negatives on eligibility are usually less than 15%. Remember this when we discuss how much you might invest to get YOUR own revenue cycle to Six Sigma, as measured internally.

Claims on the surface
Provider transmits complete claim and “scrubs” the data elements or pays for “scrubbing.” Payer accepts and pays some claims, but a double-digit percentage are rejected or pended. Providers don’t like to reveal their percentage of claims that are sent in a second time. Want to see real discomfort? Just ask about the percentage that must be sent in a third time. It is not always a single-digit number!

Claims underside
Payers have massive legacy rules tables for claim editing/adjudication. A payer might say they have XX thousand rules they apply to filter and route claims in their processing silo. If you run enough claims and keep track of results, it is not hard to show that the payer is wrong. It is not XX thousand rules, but perhaps 150% of XX thousand rules.

How can this be? Payers edit their adjudication tables. They do it frequently. The process may be less than Six Sigma, folks! Over time, they have a table full of best efforts — not a Six Sigma system. And no, you won’t get any payer to agree that this is remotely possible. This also means that if you measure diligently, your payers won’t be very responsive to this issue. Why? Can you imagine the consequences if they stepped up to solving this one?

I met with a provider who admitted to having most claims submitted more than once and many claims submitted a third time before payment. I said, “Gadzooks – your Days Revenue Outstanding must be really large.” They said, “No, it is less than two days.” I asked how that could be. The response was, “We deposit payer reimbursement checks the same or next day — we have about 1.5 Days Revenue Outstanding.” I said that we need to count from the day the claim dropped and had my head handed to me — I was yet another false expert with no understanding of how the revenue cycle really works. This type of “unintended conspiracy” of weak partner systems and small misunderstandings can indeed cause some major pain!

It is interesting to note that with big ERP installations down, the large systems integrators are selling a lot of engagements for “total Six Sigma healthcare revenue cycle reengineering.” I’ve chatted with some nice folks about the view above regarding eligibility and claims, the surface view, and the underside view. They’ve said, “So what, our re-engineering is underway and we are not Six Sigma yet.” I’ve asked the about the cost and payback for total re-engineering and heard of many projects investing more than $10 million with paybacks greater than one year.

Cheeky bloke that I am, I’ve asked what the “process quality” of eligibility and claims might be, based on local estimates of the “surface” and “underside” issues mentioned above. Folks will readily agree that process quality on eligibility may be 80% on a good day and claims process quality may be 60% on a good day. I then ask what happens when the middle of the 80% and 60% goes to Six Sigma. The response is, “Please don’t mention this to anyone — it was an important investment that we were counseled we had to make urgently.”

If you’re still doubtful, there is a test you can perform to understand “aggregate process performance” — not of your provider systems, but your total environment. Got Self-Pay? Got Unpaid Self-Pay? Sending any Unpaid Self-Pay to Early Collections? Screen your output file heading to Early Collections a day in advance — ONLY if you’re prepared to see 5% or more of the accounts with valid current eligibility that will pay the claim! If you get 7.5%, 10%, or more, be prepared to call it “an anomaly” and do re-testing over an extended timeframe. 

You can do your own math on the implications this has for what payer eligibility responses and payer claims adjudication are doing to YOUR revenue cycle, regardless of your standalone process quality. Besides, don’t you think there might be a compliance issue you’d rather avoid in heading towards collections with folks covered by Medicare, Medicaid, or a commercial payer where you’re in-network? If you don’t have resources to do this screening, then it might be worth paying to get it done. And remember, this is hardly your fault. Even if your “process pipes” are Six Sigma, if you’ve got “gray water” in the eligibility data incoming and “gray water” in the claims back from payers, you are simply using a pristine Six Sigma solution to “pump gray water.” At least don’t promise that the new Six Sigma system will reach process levels that your business partners don’t support and have no capability of reaching. Prepare to measure and report the “grayness” of your business partners’ water.

OUCH!

What are the implications of these possibilities? (I don’t expect them to be real for you until you check it out in your environment with your own payer mix, systems and data results)

1. Ignore processing charges at first. Instead, focus on process performance. If you’ve gotta pay to get process quality end-to-end, pay for performance before you get trapped chasing “false economy.”
2. Expect weak results on eligibility and focus on making it as easy as possible for staff to check eligibility when and where it makes sense. Unless it is absolutely EASY, your results will only be worse than the typical “gray water result.”
3. Expect >> 90% of claims to be accepted and paid as submitted, first time in. Impossible? Ask around. Quality solutions are not free and they are out there. Don’t settle for “we send the claims on as quickly as we can” or “we check each data bucket, for sure.” Use process metrics and announce that your headed for excellence. You’ll be surprised to see the world change around you. And yes, you may need to pay some small fees. Those are small compared to the cost of carrying one or two months of needless Days Revenue Outstanding at a time when banks and revenue bonds are “not behaving normally.” Your Treasurer can provide updates on that issue. Only ask if you have time to listen to a true tale of woe.

The Value of Clearinghouses
By Jim Denny

Scott Bayou’s Sept. 2 commentary on healthcare clearinghouses raised some good questions — and ultimately was dead-on.

In theory, there should be no necessity for transaction or interface fees. The intent of HIPAA was to provide, and ultimately enforce, an interoperability standard. In reality, however, that hasn’t happened. This means that practices and hospitals must force the issue by refusing to do business with vendors that charge these fees. They must instead insist upon free and unlimited access to X12 transactions.

Within this imperfect environment, it’s also wise to recognize the value that clearinghouses bring to the current marketplace — hospitals and medical practices alike — through standardization, efficiency, and leverage.

First of all, if electronic transactions were truly standardized as noted above, today’s typical clearinghouse might indeed be redundant. But the truth of the matter is that different payers transfer files in divergent formats with varying content, supported by a wide range of service levels. Providers are saddled, in other words, with a myriad of technical challenges when it comes to claims and revenue cycle management. Advanced clearinghouses serve as an “EDI translator” that can streamline submissions, provide meaningful visibility into claims status and adjudication, and reduce days in A/R.

Secondly, clearinghouses give providers efficiency (and economies of scale) they otherwise would not have. Let’s say that all providers across the country unerringly run into problems submitting one type of claim with one specific payer. To make adjustments, each provider would have to modify its own system. A clearinghouse, however, could update its edits engine or change processes for all its clients, relieving them of monitoring and “fixing” payer-specific anomalies. This is particularly true for SaaS-based clearinghouses.

Lastly, clearinghouses provide operational leverage. Consider data warehousing and the business or clinical intelligence it can supply to providers. If information is locked in a payer-biased clearinghouse, providers will be unable to extract, aggregate and analyze data in ways that are meaningful — much less beneficial — to them. Payer-sponsored data clearinghouses perhaps provide a more cost-efficient option. But we must remember that their objective is to serve payer interests, not provider interests.

Provider-centric clearinghouses, on the other hand, are able to offer provider-focused information that delivers valuable insight about performance, utilization, and outcomes that allows them to track key measures and gain leverage during contract negotiations.

Jim Denny is president, CEO, and director of Navicure of Duluth, GA.

Follow the Yellow Brick Road
By Craig James

Call me the EHR heretic or the guy whose sister the house crushed in the Wizard of Oz. My comments have nothing to do with how hard everyone is working, their professionalism, or their skills. So much for my disclaimer.

You can’t read a blog or Twitter post without tripping over hopeful accolades anticipating some miraculous intervention by one of the standards committees, the RHIOs, the HIEs, or the Meaningful Use  or Certification Committees. Example:

State CIOs Get ‘To-Do’ List, HDM Breaking News, August 25, 2009 — The National Association of State Chief Information Officers has published a report giving guidance to CIOs as their states implement health information technology provisions of the HITECH Act within American Recovery and Reinvestment Act.

The act requires state leadership in two primary areas: oversight for the planning and deployment of health information exchanges and management of the Medicaid incentive payments for meaningful use of electronic health records, the report notes.

“The HITECH Act placed a significant amount of new responsibilities on states in regards to state oversight for HIE and the planning and implementation grants for preparing for HIE,” the report states. “During this initial planning period, state CIOs must secure a seat at the table to establish themselves as key stakeholders and also to recognize strengths and identify weaker points that require resolution within their own offices relating to statewide HIT/HIE planning. They must ask themselves what they, with their unique enterprise view, can do to support and contribute to each of these areas.”

Let us remember the mission — accurately and timely delivery of your records from A to B. You are 1,200 miles from home, unconscious, and are rushed to the ER in a clinic in Smallville. EMRs from your oncologist and cardiologist, your CT-Scan, and your nuclear stress test, along with a list of your meds, are in the hands of the nurse practitioner as she awaits the doctor’s arrival.

Now let the grownups apply logic. Hundreds of vendors, an equal number of standards — by definition, an oxymoronic statement — home-made EHRs, outpatient EHRs, EHRs serving as RHIOs, IPA EHRs, IPA RHIOs, real RHIOs, and HIEs. Certification and Meaningful Use — another oxymoron.

Here’s a simple question. Who among us can make a reasoned argument that the current plan will enable everyone to get from A to B in 3-5 years? Right now, we call it interoperability. It’s the fly in the ointment and its degree of difficulty and costs are grossly underestimated. If you believe you can, I would love to see it articulated. I do not think the RHIO / HIE / Certification / Meaningful Use plan will work, not do I think anyone who isn’t making revenues from the current plan can make a reasoned argument. Couple that design with the fact that the vast majority of IT projects that cost more than $10 million will fail.

So what? In six to eight years we will have an open, national, browser-based EHR. Maybe we should spend time figuring out how that will work.

TPD’s Review of Semantic Web Concepts
By The PACS Designer

The Semantic Web is a term that some might find confusing when they hear about it from others. The Semantic Web consists of websites that can converse with each other to provide a more robust web experience. Sir Tim Berners-Lee, an English engineer, computer scientist, and MIT professor is the director of the World Wide Web Consortium (W3C), which oversees the Web’s continued development. He is the inventor of the World Wide Web, which was launched on December 25,1990.

Berners-Lee in 1999 had a vision of what the Semantic Web should be. “I have a dream for the Web in which computers become capable of analyzing all the data on the Web — the content, links, and transactions between people and computers. A Semantic Web, which should make this possible, has yet to emerge, but when it does, the day-to-day mechanisms of trade, bureaucracy and our daily lives will be handled by machines talking to machines. The ‘intelligent agents’ people have touted for ages will finally materialize.”

In order to improve the World Wide Web (WWW) with more semantic capabilities, we need to review the current framework of the web. The World Wide Web is constructed using a Uniform Resource Locator (URL), the generic term for all types of names and addresses that refer to objects on the World Wide Web. A URL is one kind of Uniform Resource Identifier (URI).

Another Web term is Resource Description Framework (RDF), which is intended to provide a simple way to make statements about Web resources such as Web pages and other online resources.

Now, at the end of our first decade of the 2000s, we are set to embark on a move to a more interactive Web experience.

One way to improve the Web experience is to improve the linking capabilities to the various web resource storage locations.

The Universal Data Element Framework (UDEF) provides the foundation for building an enterprise-wide controlled vocabulary. It is a standard way of indexing enterprise information that can produce big cost savings through the linking of Web resources.

One of the early linked solutions available that employs semantic Web attributes is called “Twine.” Twine is a new way for you to collect online content — videos, photos, articles, Web pages, products — and bring it all together by topic, so you can have it in one place and share it with anyone you want. Twine can be called a “mashup for the Web 3.0 era” as we move toward a Web 3.0 world. All we need now is for Tim O’Reilly to say it is officially here!

So for healthcare collaboration, if we combine linked resources in a secure private cloud, we can create a place where decisions can be made to treat patients using a broader  base of information sources.

Also, healthcare can really benefit from the move to employ more semantic Web concepts in the years ahead and begin to obtain more knowledge in the war against diseases!

http://semanticommunity.wik.is/
http://en.wikipedia.org/wiki/Tim_Berners-Lee
http://www.viswiki.com/en/Universal_Data_Element_Framework
http://www.twine.com/

News 9/9/09

From Cynical CIO: “Re: Cerner. Interesting initiative. What’s in it for them?” Click the graphic above to see the letter from HHS Secretary Kathleen Sebelius to Cerner CEO Neal Patterson, taking him up on his offer to create an H1N1 surveillance network made up of Cerner clients. Attached to the letter was Cerner’s pitch to its customers, asking them to sign an agreement allowing Cerner to distribute HIPAA-compliant aggregated data from their facilities. It sounds kind of cool. Benefit to Cerner? Well, Cerner got face time with Sebelius, did her sort of a favor, and may get unspecified IT vendor benefit someday. Add that to having a former Cerner director as President Carter’s … err, President Obama’s healthcare reform czar and you’ve got friends in high places who are spraying great gouts of taxpayer dollars directly at healthcare IT. Still, I’d say Cerner’s intentions were more noble and focused primarily toward their clients and their patients, so I tend to believe their claims of sincerity.

From Michael: “Re: Texas Toast. A certain high profile technology / billing service company issued walking orders to 30 practice management billing employees at 2:00 PM Thursday. Word on the street is that physicians are ‘heated in Houston’. Silicon Valley VC types have learned that hand-to-hand combat the physician office billing trenches is a different kind of war. The VC types ‘donated’ $13.8 million to a lost cause in March of ‘08. I’m wondering about the physicians, their cash flows, and how many physician-initiated lawsuits are on the dockets.”

From Bells are Ringing: “Re: UPMC. From their site: ‘Alcatel-Lucent, a telecommunications industry powerhouse, has played an important role in delivering innovative communications platforms, including multimedia and data infrastructures, wireless and wireline broadband access, and full network optimization.’ Fact: so-called high tech telecom has been disruptive to care processes at the new Children’s Hospital since inhabitation in May. Shhhhh.” UPMC and Alcatel-Lucent are joint venture partners, so there’s no chance of discouraging words being heard.

From Fred: “Re: Meditech. Their latest technology first was known as Focus (internally), then C/S 6.0, and the latest is Advanced Technology. You wonder how long they spent thinking about this one.” That name makes me think of the IBM PC AT, which wasn’t advanced for very long. Interesting: did 6.0 sound too much like an easy upgrade when it wasn’t, or maybe was it a good marketing opportunity to rebadge a big technology change to impress the market? I have to say I like the strategy even though the name is kind of white bread. I’d have gone with Meditech Optimized FOcus , or MOFO for short. Quick, no peeking — which name do you remember, theirs or mine?

From Mike Mills: “Re: HIEs exchanging data. Maybe the people living in those regions could get stimulus funds for travelling to the other regions, where they could get sick, so that the providers could actually have a reason to view clinical data for someone who lives four hours away!” I tend to agree that the “unconscious in the ED while on vacation” is a stretch, but somehow people always assume that happens a lot. I figure it’s 0.005% of the healthcare that raises the interoperability cost by maybe 25,000 times over just connecting everybody in a single region, but everybody likes irrelevant analogies like those involving cell phone service or ATMs.

From Mick: “Re: Steve Hess at Christiana Care. What happened to him?” Nothing that I’ve heard. His name is still on some recent press releases and his LinkedIn profile says he’s still there.

Listening: relatively new music from David Byrne and Brian Eno, reader-suggested. I’m not a huge fan of either (maybe more of their former bands, Talking Heads and Roxy Music, respectively), but it sounds pretty good.

HealthHiway, an India-based HIE platform vendor that offers connectivity to doctors in India for as little as $200 per year, gets $4 million in funding from Greylock Partners.

I’ve been getting hammered lately by vendors and organizations wanting me to provide free advertising. For Webinars and conferences, you can add them to my events calendar yourself at no charge. I won’t link to your survey, run your press release if it doesn’t interest me, or give you space for your promotional article, sorry. Everybody would stop reading if I cluttered it up with all that stuff like lots of industry sites do.

Craneware announces FY09 results, with sales up 68%, revenue up 23%, and profit up 29%. I just now remembered that I was on the hospital IT steering committee that approved what must have been one of their first US sales going back at least eight years ago. They had a pretty good story even then.

Inga is turning into Weird News Inga, having sent me this: a 65-year-old man gives the finger at a healthcare rally — literally. Healthcare reform advocates and protesters in California get into the stereotypical heated discussion (likely armed with lots of emotion and minimal facts) when a pro-reformer allegedly confronts an anti-reformer. The anti-reformer, saying he “felt threatened”, punches the pro-reformer in the nose. They get into a full-on fight and the pro-reformer bites off the anti-reformer’s pinky. It’s nice to know that such an important issue is being debated with civility by well-informed citizenry. I’m beginning to think that 90% of Americans don’t have the intelligence or knowledge to debate laws, vote, or serve on a jury, being intellectually suited only to vote contestants off reality shows.

The US Patent Office grants TeraMedica a patent for its Evercore solution and its concept of Clinical Information Lifecycle Management. 

Regenstrief EMR pioneer, HL7 co-founder, LOINC developer, and IOM member Clem McDonald receives the President’s Medal for Excellence from Indiana University. He’s now director of The Lister Hill National Center for Biomedical Communications, a research organization that’s part of the National Library of Medicine.

A great PR gimmick: the MyMedicalRecords PHR people offer to reimburse subscribers up to $5,000 if they get H1N1. The relationship between the offer and the product is tenuous at best, but it’s kind of fresh.

Up to 11% of doctors aren’t offering immunizations because insurance pays less than the cost of the vaccine itself. Studies show doctors send patients to public health clinics instead, but parents don’t often follow up and kids aren’t being immunized. CDC is very interested, having observed that half of kids with measles were seeing doctors, but didn’t get the shot.

Which of these doesn’t belong with the others: Eclipsys, athenahealth, HIStalk Practice, and Sage. The answer: none — all of those organizations (and others) are sponsoring the AAP Pediatric Office of the Future exhibit at the American Academy of Pediatrics conference in Washington, DC October 17-20. This isn’t one of those lame “media sponsor” deals where all you do is run free ads. HIStalk Practice is a real, “I’m writing a check” sponsor in support of our regular contributor, Dr. Gregg Alexander. Now I doubt you’ll start making travel plans just because HIStalk Practice is involved, but if you’re going to the conference anyway, check it out and maybe find Gregg to say hi. There’s no booth or anything, just a PC running a presentation that I haven’t figured out yet.

Norwalk Hospital (CT) CIO Jamie Mooney is named as a mentor for Columbia’s technology management program.

Former Eclipsys SVP Keith Figlioli is named SVP of the healthcare informatics division of Premier. He has no informatics background that I can discern.

From Weird News Andy: in Australia, Queensland Health has the answer to patient harm caused by overworked medical residents whose on-call shifts run up to 80 hours: drink six cups of coffee a day and eat more sugar. Maybe they should have added regular trips outside for a smoke or maybe a snort of cocaine.

Doctors from St. Vincent’s Hospital in Manhattan develop an AIDS exposure treatment widget that will be available throughout New York State. They treat exposure “as a gunshot wound in terms of urgency”, saying that infection risk is reduced by 80% if treatment is started immediately.

The Social Security Administration gives a former IBM futurist his first job as CIO, putting him charge of a $1.3 billion IT budget. He’s a good blogger, so maybe that sealed the deal.

Just as I suspected: using Facebook is a good mental workout that keeps your mind sharp, while texting, reading Tweets, and watching YouTube make you stupid. Evidence abounds.

The Army’s MC4 battlefield EMR wins two government technology awards. 

Fidel Castro editorializes on healthcare in Cuba, railing against Philips for offering discounts on medical equipment for Cuba and Venezuela, but backing off when the British government started investigating the patented software and parts it was sending there. They’re buying instead from Siemens, which is hardly shocking.

Former 3M executive Alan Wittmer joins Mediware as SVP of corporate development.

Ambulance chasers increased their TV advertising by 1,400% in the past four years.

E-mail me.

HERtalk by Inga

The nation’s unemployment rate increases to 9.7% in August. Also up: the number of jobs in healthcare, with the industry adding 28,000 more last month. Since the recession began in December 2007, the sector has added 544,000 new jobs. The biggest growth areas are in ambulatory care, nursing, and residential care.

Given the current employment situation, it’s not too surprising that more college students are showing interest in healthcare informatics and information management. Colleges offer 270 accredited programs (53 at the bachelor’s level) and another 30 are expected to be certified by the end of the year.

Healthcare data analytics company Verisk Health acquires TierMed Systems. The acquisition will allow Verisk to offer TierMed’s HEDIS reporting solution.

 
Here is a new iPhone app that sounds kinda cool, but I wonder if it will take off? For $2.99, you can buy ICEbeacon, which allows you to add family/physician contacts, allergies, medical conditions, and current meds. You also get a sticker to put on your phone, which alerts emergency personnel how to access the information. Personally, I don’t want to put a sticker on my phone. And do EMTs spend much time looking for patients’ phones?

The Department of Defense Military Health System extends its 16-year relationship with EDS, signing an $8.1 million, 12-month add-on contract. EDS will make technical enhancement to to DHIMS systems.

Christ Hospital (OH) implements EpicCare Ambulatory EMR at its 35-physician medical group and regional therapy centers. The hospital is also giving community physicians the opportunity to purchase the EMR and connect to the hospital’s system. When I went to the hospital’s Web site, I noticed they have end-user training roadmaps that can accessed (not sure if that is by design or mistake). The level of detail is pretty impressive.

The local newspaper discusses the recent Epic live at Carilion Franklin Memorial Hospital (VA) and its sounds as if all went smoothly. The hospital’s IT director is quoted as saying, “No one has cried, and that’s a good thing.” Yup.

I see the AMA has set up a Facebook page to communicate updates to physicians and patients. I guess I am not social media-savvy enough to appreciate using Facebook to get news from groups like AMA or HIMSS. I’d rather use Facebook to learn what my friends are up to (stuff like, “I washed the dog today,” and “My daughter had her first soccer game”). I also got yet another request in my Inga inbox to set up an account. I guess I could and then post things like, “Boy, was that CIO I interviewed today boring!” or take some inane quizzes like, “Which shoe are you?” Or not.

E-mail Inga.

HIStalk Interviews Janice Newell

 

Janice Newell is CIO at Swedish Medical Center, Seattle, WA.

Do you think the government’s strategy of subsidizing EMR purchases is the best way to improve patient outcomes with technology?

I certainly share their belief. I think the only thing that’s going to push adoption is money. Whether or not their approach is the best way to do that, I haven’t given a lot of thought to. But I don’t think anything’s going to move these docs but money.

Will subsidizing the purchase of EMRs themselves incent usage or will there need to be more steps that follow?

This is the easiest question?

[laughs] The second part got harder.

Well, yes. Certainly, incenting them to adopt it is a necessary first step. Then at the other end of it, there’s this little, minuscule penalty they’ll take if they don’t adopt it. That’s certainly more significant as time goes on, the penalty.

But I think the other thing that’s going to be key is really getting some significant measures of outcomes in performance, and how is this really changing the outcomes and cost, because if it’s not doing all that, why bother? 

Is your strategy any different at the health system based on what the government does or doesn’t do, or are you pretty much down the path that you plan to stay with?

We’re pretty much down the path. We had really made a huge commitment. We’re a relatively small health system, about $1.3 billion. We had already made the commitment that we were going all in with the Epic system, and so committed about, let’s say, $120 million to it over the past four years. We were going there anyway.

When you look back at that investment, would you say it has paid off as you expected four years ago?

I certainly wouldn’t say that it paid off yet, because in fact, we still have pieces that we’re implementing. But yeah, are we starting to achieve the things that we had outlines we were going to achieve? Absolutely.

What kinds of things were you looking for as measurable benefits?

Certainly we were looking for providers in general to have the information that they need as they’re actually caring for patients wherever they are. We’ve certainly achieved that, in that we have it available everywhere.

Also, in terms of improving our quality metrics, I’ll give you just one small example. Pain reassessment is always an area of interest as both a customer satisfier as well as a JCAHO requirement. Our pain reassessment measures were not that good. We made some changes to Epic in terms of what kind of notices the nurses get about pain reassessments being due. It has moved the pain reassessment measures from the low 60s to the mid-90 percent. The nurses are doing the pain reassessment in the timeframes that are required just by changing how the system was supporting them.

So certainly on the quality metrics, we’re starting to get some traction. Also, in the financial arena, we’re getting some traction. It’s a pretty broad swath there. Certainly it has improved the revenue cycle in terms of how long it takes us to get the bill out the door. It’s improved the level of billing we do, more accurate with better documentation.

Also, still in the financial arena, it’s also helping us standardize processes across the organization. One area that’s a biggie for us is the operating room. Before Epic, we had so much variation that it was incredible. The surgeons have taken it upon themselves with Epic to really start the standardization process of what supplies they use, what supplies come into the room, what ones shouldn’t be there at all. So all kinds of good fiscal outcomes.

But a lot of that must have been other than just technology. You must have had a lot of change initiatives to go along with it. How did you package up your implementation and your change management to make this all work?

It terms of actually sitting down and changing wholesale processes in our operations, we actually started out doing that. We quickly abandoned that approach because what we found out is, sure, we can sit down and talk workflow with our folks in operations. They would describe to us what they thought happened and how they thought things worked. But in fact, we found out that it was pretty consistently not happening that way.

We ended up adopting the approach of, let’s use a good model system, get it in, and make the improvements after that. So in fact, many of the process changes are coming afterwards.

It seems that anybody your size and bigger, along with some smaller, are buying Epic. What’s their secret sauce?

A couple of things. One is that they are an integrated system. I don’t even know how many modules they have any more, but they have one system that supports care in the clinics, care in the hospital, in the operating rooms, all of the billing and revenue cycle, pharmacy, lab, home care, you name it. They have modules to support all of the different functions.

Instead of us going on in a best-of-breed world, where we add two dozen different systems, each individual system, we now just have Epic. It is much more effective from both a user experience and an IT experience to have the same data, the same application be available wherever you are. If you think about healthcare as just a continuum of care, it just happens in different places, either the clinic or the hospital or the ED, it really supports that kind of a model if the organization itself thinks it’s a system. So that’s one reason.

The other big reason is that the Epic implementations are successful. They’ve done this enough. I think they provide very good support for organizations to actually have a successful implementation. I’m not sure I can say of all their competitors that their implementations go relatively smoothly.

How does that work when basically they are young people trained usually from scratch with no industry experience? What are other vendors doing wrong that they can’t do what Epic does?

Certainly the young people without the industry experience has some downside to it. Frequently they’re great technicians without the industry expertise. And if something goes wrong, that could cause some problems. But in terms of the process for actually going about with kind of a project, they have been doing it long enough in documenting what the process is.

Just insisting that their customers go through this process, sure, we all have some variation in how we do it. But Epic is pretty clear in the way they want you to do things. And so we all do things in a somewhat similar manner in implementing Epic.

They are there the whole time. No matter what, you’re going to have an Epic team with you through the implementation.

Meditech and Epic seem to have a similar approach that, right or wrong, they genuinely believe they know better than the customer and protect them from doing things that don’t make sense. Do you think other vendors are too catering to their customers instead of saying, we know the product, just do it our way and it will work?

I think so. Yeah. And the other ones are run by a bunch of marketing people. Meditech and Epic are the only ones that are run by software people. The other ones have a huge marketing influence, sales and marketing.

You have to deal with the idiosyncrasies of Epic, but at the end of the day, if it works, it’s OK.

You’ve said that federal stimulus money must be carefully managed or it will go down a rat hole. Did you have something specific in mind or was that just a general comment?

[laughs] Yes, actually, I did have something very specific in mind. What I had in mind is that there is so much variety in the systems that people have now, and these are just the organizations who could afford to be moderately early adopters.

I mean, if you think about the hundreds of systems that are already in the marketplace, and then you think about multiplying that by some factor as every Tom, Dick, and Harry sees an opportunity in the marketplace and comes up with the $99 EMR, I think it’s scary.

And then you have these little offices who really don’t know that much about technology or how to really use it in their practice, or what can go wrong with that technology in your practice — you know, 99 bucks and I’m going to be able to get $44,000 from the government, how could I go wrong?

So while we already have the data exchange issue in healthcare, some of it because not many of us have much electronic data in front of it because there’s so much variety, but if you multiply that by whatever factor is appropriate with people going out and doing every Tom, Dick, and Harry system, it just seems that there’s a lot of opportunity for that to turn bad.

I think what the government is trying to achieve wouldn’t be achieved if we just end up with, instead of three million islands of information, now we have 23 million islands of information.

Do you think that the certification process as well as the “meaningful use” criteria are going to make that less likely to occur?

No. Say we double the number of EMRs in the marketplace so that people have on their plate trying to exchange data. They’ll not all pass certification, but it’s still going to be a data exchange challenge.

I read your local newspaper’s article that said, hey, what an irony, we’ve got three of the best hospitals in Washington that are basically almost in the same neighborhood, and they can’t exchange information. How do we address this issue of everybody’s being their own silo?

At the end, at making it Epic-specific — with our Epic system, we are actually in the middle of a project to bring our largest affiliated group, about 150 docs, on to our Epic system. So they will be using Epic in their clinics, their own service area. All they have to do is share clinical data with Swedish, and they’re using our Epic system.

Instead of just having a system that supports follow-up functions within Swedish, we now have a system that supports all of the patients in our largest affiliated group, too, that we cross over thousands of patients every year. Our intent is to do that with a lot more of our affiliated groups where they can create their own little space within Epic. They can have their own service area.

It’ll be like they have their own system, except that it will be our Epic system and we will all share clinical data. We won’t share financial data, but we’ll share clinical data.

Another piece, once again at the risk of being Epic-specific, Epic actually has a capability where there are a number of us now around Puget Sound that have Epic. We have it, MultiCare has it — that’s another billion-plus organization — Everett Clinic up north. Epic actually has a feature where in fairly short order, we can have the Epic systems exchange data with each other.

Was that something that led you to choose Epic initially?

At the time, no. It was more the integrated feature that let us choose Epic initially.

How about MyChart? Is that an important part of your strategy to get closer to patients?

Absolutely. It has the ability for them to get at their information without us being the guards at the gate. Sure.

If you look at where you are and where you need to be, what do you say are your most important priorities and your biggest challenges right now?

We still have a few big pieces that we haven’t implemented yet. Two of them happen to be billing. So we need to do those other two big pieces for the professional billing and hospital billing. We’ve actually started that.

The tail end of the spectrum that we haven’t done yet is home care. So we still need to do that. Also included in that is getting it out to our affiliates. So that’s one bundle of work, which is implementing it in more places, more functions.

The other priority is a combination of improving the systems that’s been installed and actually continuing to work out how we’re going to get value out of it. So using the system to be a facilitator for our standardization efforts or workflow improvement efforts. Those are big items for us.

Improving the system itself, making the system simpler, I should say, and using it to improve our work processes.

News 9/04/09

Children’s Boston releases free iPhone infectious disease outbreak application
Rosemary Kennedy leaves Siemens Healthcare for National Quality Forum
Three HIEs are sharing data

From HomeCareMD: “Re: PDF Healthcare. Our small house call practice has been using PDF charts and CCRs for five years and love the convenience and universal applicability of Adobe files. However, it is still hard to direct-admit a patient to a hospital from a house call by sending the PDFs of images and chart elements in advance so the receiving hospitalist / institution has proof of the clinical state signed by the referring physician. All our regional hospitals use silo EMRs which block out any e-mails or attachments unless you pay to play on their medical staff and/or pay to create middleware. My understanding is that ONCHIT is about to break up this cartel-like behavior by requiring realistic ‘interoperability’ standards in such settings. Let’s hope they do. Even HIPAA has reduced requirements in urgent care situations.”

From RockStar: “Re: meaningful use. To Winchester: not sure about your angst. We find MU to be straightforward and have assured our CEO that we will be compliant with all 2015 objectives and measures. Can you be more specific about your concerns?” Personally, I think too many organizations are waiting for what is likely to be an unsurprising set of criteria only to find that they’re too late to get up and running in time.

From The PACS Designer: “Re: Web 2.0 popularity. While we haven’t seen  many Web 2.0 solutions in the healthcare space, there is much more being done elsewhere that has been bringing value back to the institutions that employed Web 2.0 concepts. McKinsey & Company recently polled almost 1,700 executives and found that most are benefiting from the Web 2.0 experience. Healthcare will be joining these early adopters in the coming years since collaboration can only bring more high quality digital solutions to healthcare practices!”

Listening: Nick Cave and the Bad Seeds, bleak but insightful theatrical dirges, one of my all-time favorites. 

I love the online photo celebration of Meditech’s 40th anniversary (check out the “dial up table” shot). I’m still hoping for that Neil Pappalardo interview one of these days. Also announced (albeit belatedly) is that some of the company’s execs met with David Blumenthal sometime before Vice President Biden’s grant announcements back in August at Mount Sinai Hospital in Chicago (a Meditech customer).

Speaking of interviews, I thought I had an inside connection that would get me one with Patrick Soon-Shiong, the billionaire who’s donating $1 billion for “the Bell Labs of healthcare,” but he shot me down.

Healthland partners with the Performance Management Institute to offer an executive information system for its small hospital customers, touting its ability to provide evidence of meaningful use.

Froedtert & The Medical College of Wisconsin credits its applications from Surgical Information Systems with reducing surgical late charges from 43% to 1.1%.

It’s a busy month for HIT meetings and Webinars according to my online calendar. You can add your event for free, you know, which will put it on every page of HIStalk.

Newcastle Hospitals NHS Foundation Trust is delaying its big-bang Cerner go-live via its vendor, UPMC. I just realized that it’s an odd, two-way street: UPMC is implementing HIT systems overseas, while Cerner, through its employee clinic, is delivering patient care.

August was a good month for HIStalk readership, especially since summers are always slow. It was the third-busiest month ever, in fact (barely missing the #2 spot), increased somewhere between 40 and 50% over August 2008. You never know with other sites copying what they see here. Luckily for me it’s harder than it looks, especially for someone who doesn’t have industry background or experience, so they aren’t putting a dent in readership. Thanks for reading. I don’t advertise, so if you want to help, e-mail your colleagues a link, possibly lying and telling them I ran an expose’ about them. That should get me one page view, anyway.

Ohio Pain Clinic creates a virtual clinic with free online patient tools such as videos, activity tracking, and a full electronic medical records system designed specifically for pain medicine. The $1 million EMR system was paid for by outside investors, which is probably an interesting story on its own.

Weird News Andy notices that another hospital decided to Tweet a live surgery. The fact that the Tweeter was a hospital media relations specialist is a good indication that the motivation was right out of some hip marketing newsletter, but the patient’s family said it was nice for them, at least. Of course, if a marketing person sat through all surgeries, they could convene a private family conference call or something instead of using Twitter for the whole world to see, but that just wouldn’t be as cool to report back to the New Media people. Wonder what the plan was if the patient died on the table? And how do you top that — a Tweeted Code Blue?

Children’s Boston develops a free iPhone application to show infectious disease outbreaks in real time, complete with alerts when the bugs are approaching. They call it “participatory epidemiology”. I guess you head for the uninfected hills when you get the beep.

The Pfizer whistleblower will be paid $52 million. Correction: he and his lawyers will be paid $52 million, which probably means he’ll end up owing money.

Richard Tayrien, DO is named chief health information officer of HCA, a newly created position overseeing EMR development and implementation that reports to CMO Jonathan Perlin. He’ll come over from Catholic Healthcare West, where he’s been VP of clinical information systems. Some of the sloppy fact-checking rags apparently don’t understand osteopathic medicine, taking the “Dr.” bait and titling him an MD (although the press release could have been more helpful and said so since “Dr.” covers a huge swath of non-specific ground, but it did say he graduated from a school of osteopathic medicine rather than an allopathic school).

An interesting snip from an interview with the CEO of the best-known medical tourism hospital in the world, Thailand’s Bumrungrad International Hospital (he also shot me down, or more precisely, ignored me completely when I e-mailed to suggest an interview a year or two ago). Anyway, “In 2007, Microsoft was looking to enter the health care arena … and it purchased the H2000 software from a company called Global Care Solutions and they renamed it Amalga HIS. As part of that transaction, we became a partner with Microsoft to develop some of the next generation of the software, which will be a totally digital version…. We’ve identified 37 modules that are the core of the offering and we’ve got various teams working on all of those and some of them have already migrated [to the new modules]. We have different releases coming out, about two a year, over the next to year so that we will be a totally digital hospital … But it requires doctors to type in these things and it’s not easy to get doctors to do that. It could also take something away from the doctor-patient interaction if the doctor has his head buried in a computer rather than looking at the patient and having a dialogue with the patient…. Hospitals, not just our hospital but I think hospitals everywhere, are facing this challenge.”

A laptop containing information on 40,000 patients from the Naval Hospital in Pensacola, FL is missing from the pharmacy department. It was beat up, so they’re thinking (praying) that maybe somebody had it destroyed but didn’t do the paperwork.

HERtalk by Inga

The American Dental Association and HL7 agree to develop joint HIT standards, which should be of great interest to EMR vendors. The goal would be to create consistent IT standards and enhance the coordination of care between medical and dental practices. Does this mean, perhaps, that ambulatory practice management systems might one day be suitable for dental offices?

The public healthcare IT programs for Boston and Denver are named winners of the 2009 Davies Award of Excellence in Public Health. Boston was recognized for its syndromic surveillance system that enables officials to track diseases seen in emergency rooms across the city. Denver was honored for its integrated health information system that includes a patient-accessible web portal for lab results.

Norton Healthcare (KY) hires MEDSEEK to rebuild its consumer website. The official press release says that Norton “partnered with MEDSEEK to accelerate its eHealth ecoSystem strategy”, which meant nothing to me. You kind of have to read a paragraph or two down to understand that Norton is really just building a better website. When did it get so hip to come up with confusing names?

Rosemary Kennedy RN leaves her Siemens Healthcare job as chief nursing informatics officer to be named senior director of nursing and healthcare informatics for the National Quality Forum.

Here’s a shocker: the 30% of doctors who earn $250K or more and significantly more satisfied with their careers than those making less money. Overall, pediatricians represent the most satisfied specialty. Hopefully you (or your doctor) are not one of the 15% “very dissatisfied” with his/her career.

Three HIEs are now able to share data, which I think is pretty exciting stuff. HealthBridge from Cincinnati, Indiana HIE from Indianapolis, and HealthLINC from Bloomington are now able to send to one another data on their combined 12 million patients.

Spartanburg Regional System (SC) plans to deploy Concerro’s shift management system, a component of Premier health alliance’s LaborConnect program. 

Teleradiology company Franklin & Seidelmann Subspecialty Radiology raises $12.5 million to expand into new markets and add services.

Allscripts sends out a tweet that 83 people attended its EHR Stimulus tour stop in Las Vegas today. There seems like there should be some clever gambling joke in there somewhere, but it’s not coming to me.

This settles it. I am learning Spanish so I can spend a few of my early retirement years in Mexico. Thousands of Americans have already headed down there, lured by the flat $250 a year fee for a health care plan with no limits, courtesy of the Mexican Social Security Institute. The plan has no deductibles, free meds, free tests, eyeglasses, and dental work. The biggest question left to figure out is mountains or beach.

E-mail Inga.

Readers Write 9/2/09

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!

Implementing the Continuity of Care Record in PDF Healthcare Format
By Stasia Kahn, MD

 

As an Internal Medicine physician working in a small digital office, I am frequently called upon to share data with other healthcare providers and patients. In 2005, a colleague introduced me to the Continuity of Care Record (CCR) standard. 

I was impressed with the interoperability of the CCR standard that would allow me to exchange healthcare data electronically with my peers, some of whom are working with an electronic medical record and others whose records remain paper-based.

Since the fall of 2006, I have been exchanging healthcare data primarily for referrals of complex patients. Data exchange based on the CCR is richer than the traditional paper medical record that most primary care physicians fax to their consulting providers.

For example, one of the beauties of the CCR is that complex medical terms are presented in a codified manner, such as ICD-9 codes for problems, NDC codes for medications, and LOINC codes for laboratory tests.  In addition, the CCR generator I use to pull the data from my database allows me to be selective and choose the relevant information that is needed to solve a particular medical problem; thereby improving the efficiency of the receiving providers.

The PDF Healthcare Best Practices Guide and Implementation Guide, which were released in 2007, supplied me with the tools to attach diagnostic images and text documents to the summary document. Most tests and procedures are in either image or text format, and by including these in the information exchange, I am able to help reduce healthcare costs.

In addition, the positive feedback I received from my peers who received PDF Healthcare files in place of traditional medical records gave me the confidence to recently begin exporting PDF Healthcare files to my patients for the purpose of populating an untethered personal health record (PHR). I believe that a patient-directed PHR that has been pre-populated with authoritative data from a primary care physicians’ electronic medical record is the quintessential, longitudinal health record that our national leaders believe to be the Holy Grail that can solve the ills of a broken healthcare delivery system.

In closing, my implementation of the CCR in the PDF Healthcare format has helped me to improve the quality of care I deliver to my patients and at the same time reduce the cost of caring for them. The CCR standard used with the PDF Healthcare Best Practices and Implementation Guides allows for the interoperable, electronic sharing of relevant, codified healthcare information at the point of care for specialty referral and into a robust longitudinal health record of interested patients.

Stasia Kahn, MD is an internist with Fox Prairie Medical group of St. Charles, IL.

Healthcare Clearinghouses
By Scott Bayou

Perhaps I am missing a piece of the puzzle, but I really don’t understand clearing-houses like Emdeon and others.

We have X12 transactions that are supposed to level the paying field, yet most hospitals that I speak with are still sending their payment data through a clearinghouse and receiving the remittances back from the clearinghouse.

On the way back is where the real confusion comes into play for me. I know from companies like HDX that there is a per-transaction fee associated with the creation of the transaction. This per-transaction fee is variable (based on your ability to negotiate?) and varies from 15-40 cents per transaction.

Why? What benefit is being purchased? Each hospital has the right to obtain their 835 remittance, and there are various products on the market that allow for conversion to fixed text formats. Buy once and create postings to your HIS while avoiding per-transaction fees.

What am I missing?

Reporting? Most people I speak with get a limited set of reports from their vendor, and have to pay more if they want to customize reports or add new.

Archival? These transactions are not that big and can be held in most hospital’s Imaging or Document Management applications.

Relationship with vendor? Perhaps, many Siemens customers are given options to purchase HDX – or are they a partner?  Not sure of the real relationship, but someone is making a ton of money out of something that should be transparent.

Management of variances? Perhaps, this is a problem that shouldn’t be, but always seems to exist in the X12 transaction processing world.

Managing the minute differences that are expected by various payers? This might be it! Lack of governance in the payer market begs the need for clearinghouses?

Maybe, but I would love to hear what others think about this.