IT System Connectivity — Key to success for medical devices and alternate site providers

MedSpan Research studies show that the success of the healthcare delivery system increasingly is based on IT system connectivity. This is true for such diverse sources as medical devices and alternate site providers. Their success depends on delivering data to the many IT systems throughout the healthcare delivery system to drive operational efficiencies, document clinical outcomes and support the evaluation of incentives included in compensation programs. Below are a couple of case studies from MedSpan Research’s recent projects that explored the importance of connectivity.

Case Study 1

Objective: Identify and assess new product feature for the software that drives a medical device.

Scope: 7 countries in North America, Europe, Asia and Australia

Respondents: Hospital-based pharmacy directors, nurses and quality assurance executives

Methodology: 30-minute Internet survey including a max-diff exercise to rank preferences among alternative product features

The study demonstrated that the integration of the software embedded in our client’s medical devices with the IDN’s or hospital’s electronic health record and other IT systems delivers significant operational efficiencies and opportunities to improve the quality of care. This finding is consistent across all 7 countries, even though the US is further along with IT integration.

Of special interest to hospital executives is integration between their medical device and the hospital’s EHR. This integration facilitates executing physician orders, ensuring appropriate care and documenting clinical parameters.

Case Study 2

Objective: Assess perceptions of a network of alternate site care providers.

Scope: United States

Respondents: Payer executives, primary care physicians, hospital and IDN executives

Methodology: 60-minute telephone interviews

The study demonstrated that the integration of outcomes data from the network of alternate site care providers with the patient’s primary care physician’s systems, especially the EHR, is critically important. Sharing information enables the primary care physician to optimize clinical outcomes and provide more complete data in support of any pay-for-performance program that might be in place. System integration also enhances the quality and completeness of the HEDIS data payers are able to compile.

Implications for our clients

Just as society is increasingly reliant on information sharing, so should your product design and your support programs. Sales and marketing messages demonstrating your product’s or service’s integration with other healthcare systems are high priority messages. The benefits the integration delivers should be clear and based on data.

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Healthcare reform and the quality of care

One of the most significant aspects of healthcare reform is its emphasis on improving the quality of care.  Many aspects of the law seek to improve the quality of care as a way of reducing cost.  The healthier we all are, the less we’ll spend on doctors and tests.  Now, if only the law could help every American lose 10 pounds!!  That would be the best ways to reduce the cost of care.

We cannot really discuss the quality of care until we know how to measure it.  There needs to be a consensus as to what constitutes good care.  The simpler these measures are to understand, the more providers and patients can focus on them and achieve success.

We also need a system for measuring the quality of care.  Quality measures also need to be simple so that they can be implemented and data collected cost effectively.  Of course, to do that, we need widespread use of electronic health records.

The U.S. government announced in February of 2009, the American Recovery and Reinvestment Act (ARRA). The ARRA act included $19 billion under the portion of its HITECH Act to promote the adoption of Electronic Health Record (EHR) technology in healthcare. Starting in 2011, medical providers can receive up to $44,000 or more by demonstrating what has termed as “meaningful use” of certified EHR technology to be eligible for government funds. 

Back to healthcare reform — the Patient Protection and Affordable Care Act (PPACA).  To drive improved quality of care, PPACA requires the identification and publication of a core set of quality measures for Medicare and Medicaid adults.   PPACA also requires Medicaid to establish a quality measurement program. 

PPACA requires the integration of reporting on quality measures with reporting for the meaningful use of electronic health records.  By focusing on the effective use of EHRs with certain capabilities, the HITECH Act makes clear that the adoption of records is not a goal in itself:   it is the use of EHRs to achieve health and efficiency goals that matters.  HITECH’s incentives and assistance programs seek to improve the health of Americans and the performance of their health care system through “meaningful use” of EHRs to achieve five health care goals:

• To improve the quality, safety, and efficiency of care while reducing disparities;
• To engage patients and families in their care;
• To promote public and population health;
• To improve care coordination; and
• To promote the privacy and security of EHRs.

In the context of the EHR incentive programs, “demonstrating meaningful use” is the key to receiving the incentive payments. It means meeting a series of objectives that make use of EHRs’ potential and related to the improvement of quality, efficiency and patient safety in the healthcare system through the use of certified EHR technology.

Stage 1, which begins in 2011, the criteria for meaningful use focus on electronically capturing health information in a coded format, using that information to track key clinical conditions, communicating that information for care coordination purposes, and initiating the reporting of clinical quality measures and public health information.

The final rule reflects significant changes to the proposed rule while retaining the intent and structure of the incentive programs.  Key provisions in the final rule include:  

• For Stage 1, CMS’s proposed rule called on physicians and other eligible professionals to meet 25 objectives (23 for hospitals) in reporting their meaningful use of EHRs. The final rule divides the objectives into a “core” group of required objectives and a “menu set” of procedures from which providers can choose.  This “two track” approach ensures that the most basic elements of meaningful EHR use will be met by all providers qualifying for incentive payments, while at the same time allowing latitude in other areas to reflect providers’ varying needs and their individual paths to full EHR use.
•  In line with recommendations of the Health Information Technology Policy Committee, the final rule includes the objective of providing patient-specific educational resources for both EPs and eligible hospitals and the objective of recording advance directives for eligible hospitals.

Healthcare reform will fund the implementation of medication management services by pharmacists.  Medication therapy management (MTM) is a partnership of the pharmacist, the patient or their caregiver and other health professionals that promotes the safe and effective use of medications and helps patients achieve the targeted outcomes from medication therapy.  MTM includes the analytical, consultative, educational and monitoring services provided by pharmacists to help consumers get the best results from medications through enhancing consumer understanding of medication therapy, increasing consumer adherence to medications, controlling costs, and preventing drug complications, conflicts, and interactions.

Healthcare reform requires the public reporting of physician performance on quality and patient-experience measures through a website that will be called Physician Compare.  What begins with the implementation of EHR and the development of quality measures that are evaluated through data supplied by the EHR ends in public reporting of the results.  This will enable patients and hospitals to work with the physicians that provide the highest quality of care.  While high-quality of care might cost more up front, the (hoped for) decrease in hospital readmissions, adverse events and co-morbidities will (hopefully) reduce costs in the long term.

Implications for Healthcare Manufacturers

The emphasis on quality measures will more and better opportunities for healthcare manufacturers to demonstrate how their products and applications drive improvements in the quality of care.  Such demonstrates need to be based on clinical data that demonstrate how the product or application performs compared to the quality measures that Medicaid and Medicare adopt.  Medical groups and hospitals will look to healthcare manufacturers and government agencies to provide data that cut across multiple settings of care.  However, the growing availability of sophisticated EHR systems could enable medical groups and hospitals to develop data that are specific to their own patient demographics and mix.  It is in the best interest of healthcare manufacturers and government agencies to help coordinate these efforts.  Healthcare manufacturers will be encouraged to develop data for patient niches so that they are ready to address data that medical groups and hospitals gather that might demonstrate different results than those generated by the healthcare manufacturers.

The government and healthcare community (ie, providers and payers) will develop the quality measures.  The medical groups, hospitals and other payers will implement the EHR systems required to collect data relevant to those measures.  There is an opportunity for healthcare manufacturers to play a role in connecting the two endpoints.  That is, healthcare manufacturers can develop algorithms for analyzing the data so that the results comply in an appropriate way with the outcomes measures that Medicare and Medicaid establish.

Today, retail pharmacies are a secondary or tertiary contact for those drug companies and medical device suppliers that distribute product through this channel.  The growing importance of MTM programs will increase the importance of retail pharmacies for select disease states (eg, hypertension, dyslipidemia, diabetes).   Healthcare manufacturers will need to develop programs at the corporate levels of the retail pharmacy companies as well as the neighborhood pharmacies to educate the pharmacists and encourage and support the appropriate implementation of the MTM programs.  More effective MTM programs will encourage therapy compliance and higher quality care.

As the above evaluation demonstrates, the ARRA and PPACA will provide numerous new avenues for healthcare manufacturers to work with physicians, hospitals and other providers to drive an improved level of care.  The time is now to plan for these initiatives and start their development.

To Profit or Not to Profit — That is the question

As Vince Galloro wrote in Modern Healthcare today (“Reform reshaping market for acquisitions by investor-owned companies, Moody’s says,” August 3, 2010)  proposed deals in Boston, Detroit and Ohio show that investor-owned hospital companies are interested in markets that don’t fit their traditional targets.  Healthcare reform is a prime reason.

As healthcare reform goes into effect, markets with higher uninsured populations could become more attractive to investor-owned hospital companies. Reform also could drive consolidation by placing greater pressure on capital needs, such as investments in information technology.

In a capitalist society, for-profit institutions offer many attractive features.  One might postulate that, compared to not-for-profit hospitals, for-profit hospitals offer business discipline encouraged by the demands of investors (ie, stock and bond holders) and financially-driven executives.  In an age where quality report cards are starting to become available and growing in sophistication, due to advances in information systems and agreement on quality measures, revenue generation is becoming as important as cost control for for-profit hospitals. 

However, compared to not-f0r-profit providers, for-profit hospitals pay taxes, issue taxable rather than tax-exempt debt and lose the benefit of charitable donations.  This raises the cost of funding for-profit hospitals.  One result is that for-profit hospitals are less willing to provide charitable care and community-based services that do not measurably link to an increase in profitable patient referrals.

In the age of healthcare reform, is there a need for both types of hospitals (ie, for-profit and not-for-profit)?  If so, in what proportion?  Which type of hospital can best react to the implications of healthcare reform, such as: 1) increased number of patients with insurance; 2) less need for charitable care; 3) decreasing reimbursement from Medicare and other payers; 4) increased opportunity for differentiation based upon measurable quality indicators; 5) increased need for capital to implement EHR and RIO?   Which type of hospital can better integrate with physicians and other providers to develop a coordinated continuum of care that drives quality and profitability under episodic payments?

 Right now, the answers to many of these questions are not clear.  Many answers are specific to each hospital, depending on the quality of the management team and individual competitive situations.  However, in general, at the moment, for-profits are likely to have greater access to capital given the healthier state of Wall Street compared to municipal governments and the impact of the Great Recession on charitable giving.  This will enable for-profit hospitals to develop programs to handle the greater volume of patients and develop strategies to enhance and measure quality and implement the information systems to support those tactics.

There will always be a need for charitable care.  There will always be a segment of the population that prefers religious-based care providers.  There will always be a need for providers in markets that are not optimal for for-profit hospitals. 

My expectation is that there will always be a need for both for-profit and not-for-profit hospitals.  Their missions and the market segments they serve will continue to differ.  The market will not evolve to predominantly favor one type of hospital.

Electronic Health Records — A Key to Progress

Electronic health records are a key to the advancement of the healthcare system.  Having medical records that follow patients across the continuum of care will enhance outcomes as all providers share a complete set of data.  Also, fully shared data will help reduce costs by eliminating redundant diagnostic evaluations and unnecessary prescribing of medications.  Electronic health records will facilitate the development of new models of care, such as the patient centered medical home.

However, only 20 percent of doctors and 10 percent of hospitals use even basic electronic health records according to Kathleen Sebelius, secretary of health and human services.

As reported by the New York Times yesterday (http://www.nytimes.com/2010/07/14/health/policy/14health.html?_r=1&hpw), the federal government issued new rules Tuesday that will reward doctors and hospitals for the “meaningful use” of electronic health records, a top goal of President Obama.  The rules significantly scale back proposed requirements that the health care industry had denounced as unrealistic.

The main criticism of the rules proposed by the Obama administration in January was that they took an “all or nothing” approach. Doctors could not have received any federal bonus payments unless they met 25 criteria, or objectives, and hospitals would have been required to meet 23.

Standards in the new rules are less demanding and more flexible. Doctors will have to meet 15 specific requirements, plus 5 chosen from a list of 10 objectives. Hospitals will have to meet 14 requirements, plus 5 chosen from a menu of 10 goals.

Doctors, for example, will have to use electronic systems to record patients’ demographic data (sex, race, date of birth); their height, weight and blood pressure; their medications; and their smoking behavior.

To meet the new standards, doctors will have to transmit 40 percent of prescriptions electronically. Under the proposal, 75 percent of prescriptions had to be sent electronically.

The Department of Health and Human Services said doctors and hospitals could receive as much as $27 billion over the next 10 years to buy equipment to computerize patients’ medical records. A doctor can receive up to $44,000 under Medicare and $63,750 under Medicaid, while a hospital can receive millions of dollars, depending on its size.

Sometimes, small steps are better than no steps at all.  Moving physicians and other providers to communicate with each other at all sometimes seems a big enough challenge to patients.  Anything that helps a patient not have to repeat the same story to each physician is a significant accomplishment.  Therefore, not only will the system reduce costs and improve the quality of care, patients will have fewer headaches just from accessing the system.

A few years ago, I was speaking with a leading researcher at the Commonwealth Fund.  He suggested that it might take 20 years to implement a fully-functioning electronic health record.  With the current administration’s financial support and guidelines for the initiative, we might achieve that goal in that timeframe.  However, a great deal can be accomplished through the “baby steps” proposed under the relaxed guidelines. 

For example, entering demographics and utilizing e-prescribing allows basic checks of appropriateness of the prescription.  It also reduces the opportunity for over-prescribing or duplicate prescribing of pain killers and other potentially abused medications.

The final rules do not guarantee that doctors and hospitals can electronically exchange clinical information on patients. The rules do require health care providers to work toward that goal, widely seen as a way to improve the coordination of care and avoid the duplication of tests. 

Of course, this is where the rubber meets the road.  Enhancing longitudinal and intra-practice communication is a significant step forward.  Using electronic health records to compare prescribing and treatment patterns to generally-accepted practice standards and algorithms will help improve the quality of care.  But a significantly increased return on investment will occur when the systems can communicate throughout the continuum of care.  The next step is for the healthcare and information technology communities to set data layout standards that will make this possible. 

Co-operation?!  What a novel concept!

More healthcare is better? You get what you pay for?

The journal Health Affairs just surveyed more than 1,500 patients with employer-provided insurance.   The majority of respondents believe that “more is better, newer is better, you get what you pay for, (and) guidelines limit my doctor’s ability to provide me with the care I need and deserve.”

Healthcare experts can come up with sophisticated ideas for containing healthcare costs.  Congress can simply mandate reductions in Medicare reimbursement.  However, without patient support, we won’t make progress with reducing the burden of the world’s costliest healthcare system.  Lack of patient support is what sunk the healthcare reform efforts of the 1990s.

The question is how to convince the majority of us that “you get what you pay for” but you don’t have to buy everything on the menu or pay more than we should for a therapy when all we have is a scratch or a cough.  When providing the best healthcare possible for our family shows our love and the best means the most costly, when Americans have an innate sense of entitlement for access to the best our healthcare system can provide, we are stuck with in “drive.”   Quick and direct efforts at cost reduction will meet nothing but resistance and failure.

Addressing this challenge will take time.  It took years to convince people to do something as simple and clearly beneficial as wear a seat belt or to not litter.  Healthcare is complex.  We need to develop simple and clear messages, supported with evidence, to change perceptions and the beliefs that are the cornerstone of our society. 

Physicians will play a key role in changing patient beliefs.  Patients will look to their doctor for guidance as to what treatment alternatives are appropriate and which are most beneficial. 

The physician-patient relationship also is complex.  Often, patients listen to their physician without question.  We follow our doctors’ directives solely relying on their judgement.  At other times, patients resist their physician’s guidance and physicians give in to their patient’s demands.  As we are our doctor’s customer, it is a case of “the customer is always right (as long as no harm is done).”  This interaction must be better managed to be more effective.

One approach is to allow doctors more time to educate patients.  This leads us to concepts such as the patient-centered medical home, which we have described in previous blog entries.  Reducing patient loads so primary care physicians can better address patient concerns, providing clinical pathways that guide physician decisions, using EHR to ensure physicians have all data available and redesignining physician and patient incentives to encourage short-and long-term implications of medical decisions will help make the patient-physician interaction more effective and focused on more cost-effective care.