MA Health Policy Forum

The Massachusetts Health Policy Forum has written a pretty comprehensive brief on the various health IT activities going on in Massachusetts. It was written to support an upcoming conference. To download the brief, go to the link at the bottom of the page.

It takes more than money

Just about a year ago I wrote about Britain's Connecting for Health program's privacy policy or, more appropriately, their lack thereof. Their approach at the time can best be described as "opt-NOT" -- patients getting care through the NHS would automatically have their data shared on the "Spine" (the national HIE). No fooling around with the niceties of opt-in vs opt-out -- patients could only opt-out by opting out of getting their care from the publicly-funded health service that they pay dearly for.

The NHS has since backed off from this stance and now allows an opt-out policy. That's still a far cry from the opt-in approach taken by MAeHC, and in the context of a burgeoning US movement toward "personally-controlled" health data management, it's downright archaic.

The latest report is that despite this change in policy, physicians themselves are rebelling against the system: 2/3 of NHS family physicians say that they will boycott data-sharing in the system according to a recent poll (see Family doctors to shun national database of patients' records). In a country where individuals have historically deferred to the government on issues of information access, this is a pretty stunning development.

Our policy in the MAeHC project is to allow patient opt-in, meaning that no information will be made available to other entities without the specific permission of patients. Our current opt-in rate is about 93%.

While an opt-in approach clearly has some short-term risks -- such as, slower adoption of systems by physicians, delays in achieving the benefits of clinical data-sharing -- it provides a firmer foundation for the overall enterprise. In the end, we won't be able to reap the benefits of clinical integration unless we build systems that both patients and clinicians can trust.

Wal-Mart's epiphany

So Wal-Mart is expanding health coverage to more of it's employees -- at least according to a story in today's New York Times. What caught my attention was the description of how they've shifted their view on health benefits -- what were once seen as pure costs are now seen as investments in the work force to improve "presenteeism" and absenteeism and thereby increase overall productivity.

Personally, I'd like to see us get rid of employer-sponsored health insurance, but I recognize that one positive aspect of it is that employers can instill market principles into health care delivery by acting as "smart buyers" of health care services on behalf of their employees. The fact that it's taken Wal-Mart, of all companies, this long to come to the realization that investing in one of their key factors of production just might improve productivity suggests that this "smart buyer" role may not be as compelling as we'd like to think. Maybe Wal-Mart's epiphany will accelerate this type of thinking among other employers.

Now, if we could just get Wal-Mart to invest in technology upgrades for their health care delivery supply chain, we might make better progress on the health IT front.....

Uh-oh....

I hope my Board doesn't read Computerworld:
"Whole Foods to restrict online postings by execs after CEO brouhaha"

Yet another plug I should have made.....

OK, so I'm still catching up. There's another shout-out that I keep meaning to make. The Partnership for Healthcare Excellence launched their website a couple of weeks ago. If you live in Massachusetts and haven't heard of them yet, you will soon.

Every Health Economics 101 class begins with a description of the basic tenets of competitive markets (many suppliers and demanders, homogeneity of products and services, full information, yada yada yada). The class then goes on to show how the health care delivery sector violates every tenet.

Health care markets deviate from the theoretical definition in a few ways. For example, consumers don't have enough incentive to worry about value-for-money (because insurance shields them from transaction prices), and they depend on their suppliers (ie, medical professionals) to tell them what services they need. Some of this deviation is structural -- the health care market is never going to operate like the auto or cereal industries because the stakes are too high and the services are too complex.

There is now a push for more tranparency in health care, which is edging the entire industry toward performance measurement and public reporting. The Massachusetts Health Quality Partners is one of the country's leading efforts in this area, the Massachusetts Quality and Cost Council is gearing up for more public reporting, and a bunch of states are already publishing reports on quality measures, hospital infection rates, costs, and medical errors (among them are Vermont, Pennsylvania, Florida, Missouri, Indiana, New Hampshire, and Massachusetts).

The real question, though, is whether consumers will make use of this information. Some believe that consumers will never act on such information, so it's a waste of time and effort. Others agree that consumers will never act on such information, but if their medical professionals will or their employers will, it's still worthwhile. Regardless, the hope is that public reporting will affect consumers in some way, whether directly or indirectly.

Employers can act as smart purchasers on behalf of patients to a certain extent, by locking in financial incentives to behave in certain ways and by demanding more from their health insurers or providers. The Group Insurance Commission tiers physicians and hospitals, for example, and structures financial incentives accordingly. Putting boundaries around what patients can demand will only get us so far, however.

What we'd all like to see is patients individually acting both as better consumers of their health care dollars AND better users of the health care system. Yet, it's hard for them to do this on their own -- our health care delivery system is too complex, and they've already become accustomed to playing a certain role in the physician-patient relationship. Actionable education is the key to bringing about this change, and that's where the Partnership for Healthcare Excellence comes in. Check out their site -- you might just learn something.....

Geek Doctor Emerges

So I've been greatly remiss in not putting in a plug for John Halamka's blog. I learn something new every time I talk to John, and now the world can too.

Best of luck John!

My kingdom for an inter-operable vendor!

The following was forwarded to me by one of our vendors (which is ironic, once you see the content).

The heads of the two leading health IT projects in the world -- Richard Granger of the UK's Connecting for Health, and Richard Alvarez, the head of Canada's Infoway -- spoke at a recent conference and complained loudly about the state of the health IT industry (see "NHS chief chides vendors for promising more than they deliver").

"Vendors! You can't do these projects without them, but many of the products proferred can't do the job," exclaimed Granger. Adding to the fray, Alvarez stated: "Vendors continue to say they can do it -- but they can't. We don't have a single vendor that is truly interoperable."

Noting that the American approach is to proceed more cautiously -- through standards development, certification, evaluation, ROI calculations and multiple panels and commissions -- Granger quipped: "Some people lack the spine...to bring about systemic benefits and seek only to engineer point-to-point benefits." This approach, he said, is "doomed to fail."

I've got only one thing to say about Granger's comments: Hear, Hear!!

Congratulations to our local health plans!

The votes are in and once again Massachusetts health plans are the best in the nation, capturing three of the top four slots in the national "America's Best Health Plans" rankings (see Harvard Pilgrim ranked top health plan in nation). Harvard Pilgrim, Tufts Health Plan, and Blue Cross Blue Shield of Massachusetts were rated top performers in clinical performance and customer satisfaction by the National Committee for Quality Assurance (NCQA).

We often hear about how blessed we are to live in a state with such world-class medical institutions -- and it's true, we are. What gets less attention, however, is that we in the Commonwealth have such terrific health plans -- non-profit, well-managed, focused on our state, and community-minded.

Health insurers get a lot of criticism -- and not all of it undeserved (my parents are physicians -- believe me, I've heard it all). Yet, in our overly complicated "non-system" that we call a health care system, health insurers are for many patients -- and especially the sickest ones -- the glue that holds the whole thing together. So, let's give some credit where credit's due and praise our local health plans who have shown themselves to be world-class in their own right.

Okay, I'm finished with today's blog and now it's time to get back to running the business.....Next year's premiums are going up by how much?!

The challenges of secondary uses of data

Part of the presumed value of greater health information exchange lies in so-called "secondary uses" of data, i.e., using patient data for activities that go beyond payment/treatment/operations, such as bio-medical and health services research and clinical trials. Many health information exchanges (including those sponsored by MAeHC) have taken an "opt-in" approach to data exchange, whereby a patient's information cannot be disclosed to "the network" without prior permission of the patient.

This has left open the question of what to do about secondary uses of de-identified data, however. HIPAA does not require patient permission if the data being used is fully de-identified, and many HIE projects are operating on the presumption that secondary uses are okay as long as they release only de-identifed data, which HIPAA allows them to do.

I've been in an increasingly large number of conversations with HIE projects around the country who are saying that even though HIPAA allows it, they're going to ask for blanket permission from patients before they release even de-identified data. And they're hoping that this "belt and suspenders" approach fully protects their activities.

Some new work sponsored by the Institute of Medicine suggests that this approach may be the minimum requirement for satisfying increasing patient demands for privacy protection (see Striking a balance between privacy and health). Of over 300 patients surveyed:

• 38% said that they'd want researchers "from each research study....to first describe the study to me and get my specific consent for such use";
• 19% would allow use of de-identified data without consent as long as the research was overseen by an IRB;
• 13% would not want their data used for research "under any circumstances";
• 8% said an upfront "general consent" would be enough for use of their data in future research projects;
• 1% said researchers could use their data without their consent

The implications are pretty startling. We have a serious disconnect between what the law allows and what patients want (and expect). Over 80% of people would NOT want their data to be used for research without their consent, even if it was de-identified and overseen by an IRB. And while it's hard to read from the survey's summary data, a large fraction may want some type of consent for each use.

There's a lot of hope that health trusts and personally controlled health records will solve all of this by giving patients ultimate control of their health information. We're a long long way off from being able to give patients that type of control, so we'll be facing these issues for a long time to come.

There's obviously no "right" or "wrong" here because it is what it is. On the other hand, we should always be cautious about surveying people about abstractions -- a little education and concrete experience may change people's perceptions dramatically. That said, the threshhold on privacy protection is clearly getting higher, and what may have seemed like conservative approaches to privacy protection yesterday may become barely adequate tomorrow.

George Clooney's heart's in the right place, but his head isn't

One of my favorite news sources, People magazine, is reporting that George Clooney thinks that the Palisades Medical Center should go easy on the 40 employees who illegally looked at his medical records (see George Clooney Addresses the Leak of His Medical Records). The employees have been suspended without pay for a month. While I love Mr. Clooney as an actor, and am very sympathetic with his politics, on this one I think his compassion has gotten the best of him.

Unauthorized disclosures of patient information happen all the time. Most of the time it's unintentional and no harm is done. With intentional disclosures, there is a temptation to tailor punishment to motive -- specifically, to separate cases where a person looks at a record "with malice" from cases where it's "without malice". That's clearly what's going on at Palisades, and implicitly, in Mr. Clooney's head. I assume that the punishment would be different if an employee was found to be stealing Clooney's identity, or looking for his address or phone number to stalk him.

As more health care institutions convert to electronic medical records, there is increasing concern about privacy protection, and most of that concern is understandable and well-placed. The enormous benefits that can come from greater use of EMRs will go unrealized if we adopt a cavalier attitude on technologies and policies related to patient privacy. Suspending workers without pay in this case strikes me as being unbelievably lenient. If I was a patient at Palisades Medical Center, I would switch immediately to an institution that has greater respect for the trust that I've placed in them as the custodian of my records.

For docs, there's more to email than meets the eye....

An interesting piece in yesterday's Seattle Post-Intelligencer -- "The doctor will e-mail you now." The Group Health Cooperative has completed a study on physician-patient email and found that, contrary to the fears of many physicians, email doesn't affect profits and seems to improve patient satisfaction and perhaps even the quality of care. Though emails do reduce the number of patient visits, which reduces revenues to the practice (but benefits patients and health insurers), emails also reduce the number of phone calls, which reduces direct and indirect costs. Seems like the revenue loss was made up for by cost reduction.

GHC also found that email interactions focused more on "prevention and overall health goals", and one physician suggested that as a result his visit mix had changed so that more of his office visits were focused on acute care. Hopefully the study took into account the higher reimbursements per visit that would accompany such a shift -- if not, the move to email might even result in a net profit increase to the practice.

Given that primary care physicians in Massachusetts are already at capacity, I find it hard to believe that emails would reduce their visits -- it would just reduce their backlog. And in the meantime, the GHC study suggests that it would increase profits, quality of care, and patient satisfaction.

This shouldn't be surprising. Since the most scarce resource is the doctor's in-person time, it's optimal to channel as much acute care as possible into that time, since it gives the highest reimbursement to the physician and the greatest satisfaction to the patient. A practice will get higher reimbursement and deliver higher value by using email to siphon off non-acute visits so that the practice can focus office visits on acute care. And the beauty of email is that for a large number of patients, they'll self-select -- if they have a non-urgent question, they'll email it and not take up office time that the practice wants to devote to acute care anyway.

I'm working with some physicians now who used to do email with patients but found it too time-consuming and have now either quit or have started charging patients for it, which has reduced the number of emails dramatically. Judging from the GHC results, these docs might want to take a harder look at the economics of email.

One Step Forward for Dossia

Things are finally looking up at Dossia. The PHR project was launched awhile ago with all sorts of ballyhoo and misplaced optimism by a consortium of companies, led by Wal-Mart and Intel. After very low uptake by employees, and a disasterous falling out with their vendor, the project seemed to be on the brink of collapse due to an ill-conceived strategy, lack of expertise, and poor execution. It's most recent announcement suggests that they've solved at least the second problem.

The Wall Street Journal reports that Dossia has signed an agreement with folks at Childrens' Hospital of Boston to base the Dossia infrastructure on the Indivo architecture that has been under development at Childrens' for many years (a free preview of the article is available at WSJ, and there's a press release on the Dossia site). Dossia should be congratulated for bringing the Childrens' folks on board. If you ask me, Indivo is the most thoughtful and firmly grounded PHR project in the country, bar none. The folks behind Indivo -- Drs. Isaac Kohane and Ken Mandl -- are bonafide informatics heavyweights, and they've been thinking about this and experimenting with it for a very long time.

I don't think Dossia is out of the woods yet though. While I'm in complete agreement with the Dossia vision (and indeed, very few people in this field disagree with the vision), and they've now got the best informaticians on their team, I still think that their strategy is naive. The basic argument remains: Is higher health IT penetration going to happen from the demand-side (ie, consumers using their PHRs to push their doctors to adopt EHRs) or the supply-side (ie, fostering greater EHR use among providers to make PHRs relevant in the first place)?

My own view is that the demand-side approach is premature right now because there isn't enough electronic information available yet to make external PHRs (ie, PHRs that aren't connected to any particular provider or insurer) an attractive value proposition for most patients. Most clinical information right now is non-structured, non-electronic information that is held by fragmented, disorganized, paper-based provider networks. Some information can be assembled, like medications from health insurers. It falls off pretty quickly from there though. A lot of folks look to the national labs as a source of electronic info, for example, but their penetration is highly variable by market and generally quite low (on the order of 10% in Massachusetts is my guess). And don't even think about external PHRs getting information out of hospitals and doctors' offices -- it's so far from being scalable that it's not even worth talking about.

Overall, I think that we still need to focus on the supply-side -- figure out how to get more EHRs and HIEs into the hands of physicians so that more meaningful information is available to doctors and patients alike. Demand-side pressure can work too, I think, but not through PHRs, but rather, by patients' choosing providers who have EHRs.

That's the way it's working for me. I've signed up with a national PHR company, but for me it was too much work for too little gain. Rather than expending any effort on a PHR where I had to do the work and that was still unlikely to bring my info together easily or effectively anyway, I voted with my feet and moved my care to a provider (Harvard Vanguard) who already has an EHR and can make my information available to me through their own patient portal.

I may not have "control" in the sense that access to my records is governed not by me but by Harvard Vanguard's corporate policies, but if they gather and enter the information for me, AND store it, AND give me electronic access to it for free, that's a worthwhile trade-off to me. In return, the work that I'm willing to do as a patient is to channel my care to providers who are already integrated -- physicians at Harvard Vanguard and the hospitals they're connected with -- rather than spending my own time and money (or having my employer spending MY time and money) trying to integrate unwieldy information from disparate, disconnected providers.

I may not have direct "control" of my info, but I've invested my trust in an organization that I'm confident won't abuse it, and I'm not at all worried that my employer will get access to my info. It's in the hands of my doctors, which is exactly where I want it to be.

Dress codes for doctors

Today's Boston Globe had a little snippet entitled "Hospitals ban ties, jewelry for doctors". Apparently, concern about infection control has led British hospitals to ban physicians from wearing ties, jewelry, and long sleeves.

I'm sure that there are valid reasons to do this from an infection control perspective. Most convincing to me, though, was the statement by the Department of Health: "Ties are rarely laundered but worn daily...They perform no beneficial function."

I wish that all government policy statements were as succinct and to-the-point.......

Looking at EHR adoption growth from the supply-side

One of MAeHC's EHR vendors, eClinicalWorks, has made Inc. magazine's Top 500 Fastest Growing Private Companies in America. eCW has won plenty of accolades in health industry rankings, but this is the first time that I've seen an EHR company rank highly in national comparisons across all industrial sectors; with over 2500% growth, they ranked #34 overall, #4 among all software companies, and #1 among Massachusetts companies. Congratulations to Girish Kumar, Mahesh Navani, Dr. Rajesh Dharampuria, and the entire eCW team.

It made me wonder how much of this is a market phenomenon vs an individual company story. If EHR use is substantially growing, supply would have to be increasing through some combination of new entrants and substantial growth for existing companies. Since the EHR market is very fragmented with many more private companies than public (CCHIT certified more than 90 vendors last year), I would expect to see a lot of EHR companies on the Inc list. Well, they may be there, but I couldn't find them. My non-scientific, non-exhaustive searching of the Inc. website found only one other CCHIT-certifed vendor: Greenway, at #1570 with 227% growth. I also found a practice management vendor (AdvancedMD), which came in at #465.

Of course, the larger players such as Allscripts, NextGen, GE, wouldn't appear on the Inc list because they're publicly traded. According to their SEC filings, they've shown healthy -- but not spectacular -- growth (15-20%) over the past year.

In 2004, President Bush set a goal to have the majority of Americans on an "interoperable EHR" by 2014. Robert Kolodner recently projected that the US would reach this objective. Outside of eCW's huge growth, there doesn't seem to be much obvious evidence that the EHR market is on the steep part of the "hockey stick" growth path that would be required to take us from the current situation -- where probably 10% of Americans' records are on an "interoperable EHR" -- to the goal of having 51% seven years from now.

Portland suffers from the tyranny of the status quo

The Health Data Exchange Group of Portland, Oregon is apparently on the verge of collapse, according to the Portland Tribune ("Record-sharing stalls"). The Tribune article is a very penetrating look at the difficulties of launching and maintaining an HIE.

Founded by the Oregon Business Council, the group seemed to have a lot going for it -- funding, staff, tech-savvy population, and broad-based board. According to the Tribune:

[A] year after the group began its work, the project has stalled — a victim of technological issues, and also of some overbearing financial disincentives: Some of the entities being asked to pay for the system can make a lot more money when the system isn’t in place.

On the face of it, the project seems to have violated a core principle -- make sure the first step has a business case, however small. The first project was for a "Results and Reports Viewing and Retrieval System" that would "make already-computerized information from laboratories, hospitals and imaging centers available for viewing and retrieval by all of a patient’s providers."

The project plan called for them to do this in 12 months -- wildly ambitious for a project of this scope. It took many years to get a more limited results delivery system up and running in Indianapolis, if you count the hard work done in value proposition development and business planning -- and Indiana already had an unparalleled base of technology and expertise to build on.

A second more fascinating aspect of the story is the reluctance of the hospitals to participate in the project, reportedly because a main value driver -- reduction of duplicate tests -- was going to cost them $10M in lost revenue.

In my experience, it's rare to hear someone publicly admit that they're benefiting from waste in the system, and then go on to defend it. Yet, that's what Dick Gibson, CIO of one of the hospital systems, did. He even spun the argument to defend even more economic inefficiency, arguing that redundant tests shouldn't be cut because the revenues are used to cross-subsidize free care. I'm sure that's partly true, but that's a very inefficient way to fund free care. And besides, if redundant tests weren't driving up the cost of care, maybe we'd need less free care to begin with!

I would think that the hospital boards would step in at some point and exercise the strategic judgement that I once heard from a senior executive at a large lab company: Building your business on waste in the system is not a sound long-term strategy, particularly when that waste has been exposed. In Indianapolis and Cincinnati, the hospitals pay a large share of the costs of the HIEs because there's a clear ROI for them in results delivery. The hospital leaders leading those HIEs have made the strategic decision to compete on quality, efficiency, and patient satisfaction, not on who can extract more waste from the system.

Perhaps the biggest surprise here is that those with the greatest interest in wringing out the cost of redundant tests -- namely the health plans, employers, the state of Oregon, and patients -- are standing on the sidelines and allowing the hospitals to block the project. I find it hard to believe that they'll be silent for long......

Minnesota mandates EHRs by 2015

I like to think that Massachusetts is at the forefront of health IT in the US (okay, okay, the truth is I'm seriously torn because I have a VERY soft spot for Indiana as well). But the news coming out of Minnesota is that they may soon be able to lay claim to top spot in health IT. According to Government Health IT News, the state of Minnesota has mandated: 1) electronic claims by Jan 2009; 2) e-prescribing by all providers serving state employees and their dependents by 2009; and 3) "interoperable EHRs" by all physicians and hospitals by 2015.

In order to get rapid change in this or any other industry, you need either strong economic incentives, strong regulatory compulsion, or a mix of both. The way US health care delivery (and reimbursement) is currently structured, incentives will probably only get us so far before we have to add in a bit of compulsion (or maybe, a lot of compulsion). The EHR mandate issue has come up before in Massachusetts. Given how broken health care delivery is today, I think a mandate is a good idea, but only if we inject funding and support to help physicians and hospitals to achieve the mandates effectively. Otherwise, we can mandate all we want, but we'll only get as far as the current system will allow us to go (ie, not far).

MAeHC estimates that it will take about $500M to get just the ambulatory side done in Massachusetts -- more if you want to include hospitals like the Minnesota mandate does. I haven't heard that Minnesota has provided much funding for their EHR plan ($14M for rural practices). Maybe Massachusetts' and Indiana's leading positions are safe after all......

HHS Secretary Launches Blog

For those who haven't seen it, HHS Secretary Mike Leavitt has launched a blog. Only three entries so far. The really interesting parts are his running descriptions of what he does every day. Less interesting, the rest of the entries so far read like speeches and policy pronouncements.

I don't know if any other Cabinet secretaries have blogs (I doubt it -- imagine what Donald Rumsfeld's would have been like). It's hard for a political appointee to reveal what they're really thinking, and I wonder how much will be ghost-written, what type of editing it'll go through with his own press team, and what type of pre-posting screening the White House staff will impose on it. Remember what happened to Dr. Richard Carmona, the former Surgeon General (see "Ex-Surgeon General Says White House Hushed Him").

Nevertheless, I think it's a laudable effort. Best of luck Mr. Secretary!

Medicare takes the plunge

Medicare will soon stop paying hospitals for the cost of treating "preventable errors, injuries, and infections that occur in hospitals" according to a front-page story in yesterday's New York Times. I'm not an expert in this area, but my naive observation is that this single policy change will mark the beginning of dramatic changes in health care reimbursement -- and perhaps health care delivery -- in the coming years. (Plenty of experts have weighed in on this -- Paul Levy has some links to them).

Commerical plans have been slowly but surely moving into the so-called P4P era of reimbursement, and Medicare is making its way there as well (David Harlow last week posted an excellent summary of Medicare's programs -- CMS forges ahead with pay-for-performance (P4P) initiatives). Up til now, the P4P conversation hasn't focused much on safety. There's been plenty of attention given to voluntary efforts and reporting on safety at the state and national levels (e.g., in Pennsylvania, Massachusetts, Indiana, and IHI's various campaigns). And, of course, there's Beth Israel Deaconness Medical Center which, under the leadership of Paul Levy, has been taking the lead in this type of reporting. But this focus on reporting and prevention had not really penetrated the conversation on payment and incentives. Until now.

On the face of it, the issue seems pretty straightforward. I pay you to do something, and if you screw up along the way, you should pay to fix the screw-up that you created. In practice, of course, it's much more complicated. A couple of issues that come to mind are:

Measurement. Are there clear ways to distinguish preventable from non-preventable errors? The issue is both with respect to categories (e.g., central line infections but not other types of infections) and threshholds (e.g., zero tolerance vs deviations from a baseline). If it's like most measurement, the majority of cases will be relatively easy to categorize, but some won't, and this minority of cases will constitute 90% of the measurement effort and 100% of the pushback.

Payment. Who's going to pay for the treatment of preventable errors? While we'd like to think of these as potentially zero-incident events, we live in a messy world, and statistically it's never going to be zero. So, let's say I suffer a "preventable error" in the hospital, and my insurance carrier tells the hospital that they're not paying for my treatment. Well, who does pay at that point? Supposedly the Medicare rules are going to say that the hospitals can't pass this cost to the patient. Is the hospital on the hook for the payment? What if the error was caused by a physician who isn't a hospital employee -- is s/he responsible for the payment? Will hospitals and physicians have to take out more or a different type of insurance to cover such payments? Will their malpractice liability exposure go up if Medicare determines that a particular patient suffered from a preventable error? Will their malpractice insurance premiums be affected if Medicare determines that they caused preventable errors, even if no litigation arises from the incident?

I don't think these complexities are show-stoppers -- after all, health care reimbursement addresses very complex issues every day (the new 2008 rules on inpatient prospective payments are over 2000 pages long -- and that's just this year's changes). I think this is a watershed moment in health care financing because it constitutes a real step away from the current "cost-plus" paradigm of reimbursement. I don't count current P4P efforts as real change because there's much more smoke there than fire owing to weak measures, dubious connections between those measures and actual quality, and correspondingly, shallow financial incentives.

Not paying for preventable errors seems different than current P4P efforts because it's something that patients/consumers (and the media) understand, it deals with reimbursement at the individual case level rather than the patient panel level and, finally, there's real money on the table. The fact that Medicare is taking this step is perhaps the biggest news of all. Medicare is the biggest player in the health care market, and commercial plans are generally loathe to make fundamental changes in reimbursement approaches without Medicare's participation because they don't want to "go it alone" against physicians and hospitals, and because their efforts are ineffectual anyway if they are diluted or contradicted by Medicare policies. Medicare's making these changes gives commercial plans the cover and the incentive to make more far-reaching changes in their own reimbursement approaches than they've been willing or able to make for a very long-time.

Breaking it to the American public

Sunday's New York Times had an excellent editorial: "World's Best Medical Care?" The article begins as follows:

Many Americans are under the delusion that we have “the best health care system in the world,” as President Bush sees it, or provide the “best medical care in the world,” as Rudolph Giuliani declared last week. That may be true at many top medical centers. But the disturbing truth is that this country lags well behind other advanced nations in delivering timely and effective care.

Most health care professionals already know this to be true. It's also true that we lag behind most of those same countries in the use of health IT. The connection between health IT and quality is pure correlation at this point -- no one has proven causation. Health IT won't be a panacea anyway -- most "wired" physicians I've worked with point out that the technology has only revealed for them how much the technology can't fix and how deep our problems really are.

Looking across countries, I'll bet that greater IT use is not a cause of greater quality, but rather, it's an indicator of a better health care system. Those systems have aligned incentives in a way that encourages not only IT tools but a whole host of processes and behaviors and tools to improve quality, safety, and efficiency -- exactly the opposite of the incentives in the U.S. system. Doesn't mean that adding health IT won't improve the U.S. -- I think it will. But we shouldn't kid ourselves about the fact that we're sub-optimizing -- until we have a health care system that is fundamentally oriented toward improving the quality, safety, and efficiency of care, we'll continue to be outperformed by our peers, regardless of how much technology we put in place.

The Dossier on Dossia

My friend David S. has been politely but earnestly pushing news items to me in order to spur me to get back to blogging. For the record, it's not so much lack of fodder but lack of time that undermines my blogging frequency -- with an increasingly complex and fast-moving company, three complex and fast-moving children, and one fast-moving (but not complex) lab-mix puppy, it's been unbelievably difficult to find the time. Many many thanks, though, to David S. and the others who have inquired about the blog and expressed interest in its return. And of course, more fodder always helps....

The Dossia project has taken some interesting turns in the last couple of months. First was Marianne McGee's initial report in Information Week ("Major E-health Records Project Unravels Into Legal Battle"). More recently, Modern Healthcare reports that Dossia has asked a court to seal the records of its dispute with its vendor over the project ("Dossia wants PHR deal kept under wraps").

Though I have been fairly critical of the Dossia project since it's origins ("Hi, I'm from WalMart and I'm here to help" and "You can't get blood (or data) out of a stone"), I don't take a whole lot of pleasure in seeing a high-profile health IT failure, especially at a time when we in the field have very few successes to speak of. That said, it's probably good that it's falling apart now on relatively straightforward corporate contract issues (money, deliverables, etc), because it shows that they're probably not yet ready to tackle the hard stuff anyway -- like privacy, security, access, control, secondary uses, etc etc etc.

One fascinating aspect of the issue is the David and Goliath angle. Dossia (ie, WalMart, Pitney Bowes, British Petroleum, Intel, etc) is throwing legal weight around in court trying to prevent public access to court records about some pretty mundane contract issues -- relatively small amounts of money ($6 million or so), associated contract deliverables, and conflicting claims of breach of contract. And they're turning the screws on the Omnimedix Institute, a 15-person non-profit organization. Don't get me wrong -- Omnimedix may very well be in the wrong, and unsuited and unqualified to take this on besides, but they are, in the end, a 15-person non-profit organization.

If this display of bare knuckle tactics and secrecy about details is any indication, Dossia's leadership seems like it might be a little behind the times with regard to patient privacy, consumer empowerment, and transparency. Let's just hope that they get up to speed by the time that there's real patient data on the line.....

RHIOs still a tough row to hoe

This week's GovernmentHealthIT reports the dissolution of the Northeastern Pennsylvania Regional Health Information Organization ("Pennsylvania RHIO to close"). This follows on the demise of the Santa Barbara County Care Data Exchange. In the coming weeks another relatively high profile effort will announce their decision to dissolve.

There are over 200 HIE efforts across the country, most still burning through their initial grant funding, trying to find the elusive "sustainability" model. None have yet been able to replicate the successes of the only self-sustaining efforts to date: Indiana Health Information Exchange, HealthBridge, and MA-SHARE.

It's worth noting that the lines of business that have made these efforts sustainable so far haven't been about ubiquitious sharing of data, per se; success in these efforts has come from creating a single "pipeline" that efficiently channels disparate streams of data. The successful product/service areas have used technology to create economies of scale in basic backoffice functions, and collaboration to convince participants to outsource these functions to the "RHIO".

This general model can be replicated in many other places, so there's still plenty of opportunity out there, but it's not a universally applicable solution. Making this model work in other places where it fits, and establishing other value-generating product/service areas where the model doesn't fit, will be key to getting more RHIOs firmly in the win column.

David Brailer Returns

Today's New York Times reported the launching of Health Evolution Partners, a private equity fund led by Dr. David Brailer. Everyone in the area of health IT will remember David, the first National Coordinator for Health IT (ONC) and architect of the Strategic Framework for Health IT.

Brailer's idea is to apply private equity (he has $700M from CalPers to start) to a new type of niche: products and services that can exploit new developments in health information exchange to reduce fragmentation of care and improve quality, safety, and efficiency of health care delivery. This hasn't been an area that has typically drawn much private capital for a few reasons.

First, there are barriers to entry in becoming a domain expert. Health care delivery is so darned complicated that there are fewer people with both deep domain knowledge and investors' acumen than there are in other market sectors.

Second, investments in health care delivery don't typically meet the hurdle rates that typical venture capitalists apply to their investment decisions. The health care delivery value chain is convoluted, at best, as are the distribution of costs and benefits across the value chain. In addition, while the costs are crystal clear, the benefits aren't; benefits such as reductions in ED visits due to better preventive care, for example, take a long time to get realized and are hard to measure.

Finally, a lot of investors just think that health care delivery isn't really a market, and thus, they don't want to invest in a sector where they don't know the rules or how the rules are made. I used to work in the Pentagon and found a similar attitude among many investors toward the defense industry.

Yet, there's opportunity in health care delivery for those who can thread their way through the thicket. It requires some patient capital (perhaps VERY patient capital) and a unique combination of expertise in the nitty-gritty of health care delivery, business/economics, and technology. Health Evolution Partners seems like it's got the perfect combination of these assets -- I wish them well.

IT Writer, Familiarize Thyself

Yesterday's New York Times had an op-ed on EHRs by Thomas Goetz, an editor of Wired magazine ("Physician, Upgrade Thyself"). Goetz believes that he's found the silver bullet on EHR adoption -- it's open-source software, namely, WorldVistA. I guess I was hoping for something more compelling from an IT expert, so forgive me for being underwhelmed.

The crux of his argument is that physicians have huge desire for EHRs, but this demand is stifled by the high cost of the software. WorldVistA, the ambulatory version of the VA's VistA system, is his answer -- it's open source, which to Goetz means that it's low-cost and good enough. He notes that WorldVistA may not be as good as its competitors -- it's user interface is clunky, and it's practice management functions are primitive -- but, he says, these are "Cadillac" features that most physicians needn't worry about.

I don't want to dismiss WorldVistA out-of-hand; my mother spent her entire career as a VA physician, and I myself was a Pentagon civil servant for a number of years, so I'm heartened to see the VA finally get recognized for it's great work with VistA and for the entrepreneurial spirit that has taken it to market. I'm also glad to see that Wired magazine is excited about WorldVistA -- they gave it a 2007 Rave Award. I think it's important not to confuse our hopes with our expectations, however. WorldVistA could find a place in the market, but that's a far cry from becoming the magic solution to the "EHR gap".

If physicians have huge desire for EHRs, they must be hiding it really, really well, because EHR penetration is shockingly low and it's not growing very fast. Clearly, there's more than just cost that's holding them back. Health care delivery is the most fragmented sector of our economy, both on the supply-side and on the demand-side, which has created an unbelievably dense thicket of contractual relationships among purchasers, insurers, providers, and patients. The amazing thing is that almost every aspect of this tangled mess militates against higher EHR adoption. It's thus highly unlikely that one single change, such as a lower cost EHR, can tip the scales on EHR adoption.

I'm not convinced that WorldVistA is that much lower cost anyway. Yes, it's license fees are lower, but license fees are only one small part of the total cost of ownership of an EHR. A practice still has to pay for hardware, networking, installation, implementation, training, upgrades, and maintenance, and it's not clear that WorldVistA would have any cost advantage over its competitors in these areas. The fact that it's open-source doesn't solve these problems either. An EHR will never have the dense base of expert contributors that continue to drive Firefox and Linux -- physician offices don't have programmers with expertise and capacity to develop open-source code, and EHR software is too specialized to attract a large base of student and/or corporate developers.

Finally, while Goetz pooh-poohs the deficiencies in WorldVistA's user interface and navigation, as well as it's back-office functionality, I don't think these issues can be so easily dismissed. Back-office functionality affects the revenue-side, and most practices have some type of electronic billing already. Lack of integration with back-office systems is a show-stopper for most practices because billing for health care is so complicated. Yet, creating such functionality is real work -- it takes considerable effort to develop and support a robust PMS application, and it's not the type of project that lends itself to ad hoc contributions from an open-source community.

It is perhaps ironic, but nevertheless true, that only the most sophisticated computer users make use of open-source software. Yet, physician offices represent the least sophisticated stratum of computer users. It's hard for me to see how WorldVistA will be able to change that equation.

Clarifying a recent Information Week article

This week's Information Week had a few interesting articles on EHRs and PHRs. The lead article ("Why Progress Toward Electronic Health Records is Worse Than You Think") hits on some of the more well-known cautionary notes, like the demise of the Santa Barbara Care Data Exchange, and the widely-reported issues faced by Kaiser Permanente in it's Epic installation. The article also describes what may be a deeper and more insidious challenge to significant progress, namely, the lack of urgency among the vast majority of physicians to get moving on EHRs and HIE.

The articles also quote me and describe the work of the MAeHC, and while I'm fine with most of the reporting on us, I want to clarify some false impressions that the articles could create about us and our work.

First, I'm not nearly as arrogant as I sound in the article (not nearly!). When asked if I felt that there was a lot of pressure on us to deliver, I responded that we certainly feel that there is a spotlight on us. That got turned into a quote that has me suggesting that THE national spotlight is on us, as if there aren't other important activities going on around the country. There are over 150 HIE efforts around the country according to the last eHealth Initiative Annual Survey, and concrete, replicable successes among any of them will be important guideposts for the rest of us and for the national effort at large.

A second clarification I need to make regards a sidebar article on PHRs ("Doctors Debate Giving Patients' Online Access To Health Data"). The article suggests that an MAeHC-funded practice won't give patients access to records because "patients aren't ready and doctors aren't ready." This does not accurately reflect either MAeHC's PHR plans or our views on the "readiness" of physicians or patients for this technology.

MAeHC expects to launch patient portals in all three of our communities, including the one referred to in the article. These portals will have the benefit of being "untethered" from any specific provider, so that patients will be able to access summarized clinical data from all of their community providers, not just any one provider. Not only do we believe that physicians and patients are ready for such technology, we believe that such patient-centered applications should be one of the principal goals of community EHR/HIE programs.

We're honored to have Information Week devote space to describing our project, and I think that their reporting on the lack of urgency for EHRs and PHRs among physicians and patients is spot on. I look forward to following their future coverage of these important issues.

Pennsylvania maps out an EHR strategy

The Pennsylvania eHealth Initiative (www.paehi.org) has released a report detailing an EHR/HIE roadmap for the state. Seems like an excellent first step. There are already a number of innovative initiatives in Pennsylvania, like the Pennsylvania Health Care Cost Containment Council and the Pittsburgh Regional Health Initiative. I was recently at the National Business Coalition on Health conference on Advancing Value-Driven Health Care at which I heard Governor Rendell describe his Prescription for Pennsylvania program, which would base the state's approach to health care on Ed Wagner's well-known Chronic Care Model, shown below (you can see the Governor's plan here and a story about it here).

I don't know of any other state that's focused it's entire strategy around a specific model like this. It's ambitious and somewhat risky politically because the urgency for such reform stems from a need for cost control, but a comprehensive chronic care approach like the Wagner approach will probably pay dividends over the long-run but may very well cost more in the short-run.

The PAEHI report maps out an EHR/HIE strategy to support the Governor's strategy. This strikes me as the right approach -- first, get state leadership to articulate a vision and strategy for health care, and then articulate an IT roadmap to support the vision. Unfortunately, what's missing from the PAEHI roadmap is the same thing that's missing from most other such plans around the country: $$$.

National (I mean, Nationwide) Health Information Network, Round 2

The next round of Nationwide Health Information Network projects is set to launch. For those who missed Round 1, the Office of the National Coordinator (ONC) let 4 contracts a couple of years ago to consortia led by large IT-type companies to develop prototypes for a Nationwide Health Information Network (which was, at the time, called the National Health Information Network). Those companies were: Accenture, Computer Sciences Corporation, IBM, and Northrop Grumman.

The contracts were originally let under David Brailer, the past head of ONC, but he left while the contracts were underway. Looking at the work undertaken by these groups and the ensuing "deliverables" resulting from those contracts, many of us are left scratching our heads about what the NHIN prototypes were supposed to accomplish in the first place. You can judge for yourself by looking at the results of the 3rd NHIN Forum held earlier this year.

So, fast forward to the present. Late last week a "pre-solicitation notice" appeared quietly on the FedBizOpps website. The synopsis reads as follows:

As part of advancing the President's Health Information Technology agenda, the Office of the National Coordinator for Health Information Technology (ONC) of the U.S. Department of Health and Human Services (HHS), will be soliciting proposals to establish Nationwide Health Information Network Trial Implementations. The purpose of this project is for state, regional and non-geographic health information exchange consortia to become components of the "network of networks" that is the nationwide Health Information Network (NHIN). These consortia should combine inclusive organizational governance and trust relationships, provider organizations and healthcare markets, consumer applications and participating consumers, existing health exchange activities and technical expertise. Each Contractor shall work cooperatively with the other contractors to develop specifications for, and trial implementations of, the NHIN, and test these trial implementations with each other to ensure that they can all work together to implement an interoperable "network of networks" - built on top of the Internet. The trial implementations shall demonstrate core services, exchange summary patient records and support the capabilities outlined in several AHIC use cases based on shared NHIN standards and specifications. The trial implementations shall demonstrate the represented information exchanges with provider organizations, personal health records, specialty networks, and the other NHIN contractors. This is a partial small business set-aside with up to a third of the contracts awarded to small businesses. We anticipate the award of up to 10 contracts. The period of performance shall be for a period of 1 year, with two 1-year options. Options will be evaluated with the base period. Options may or may not be exercised based on performance of the contractor and the needs of the Government.

I don't really know what all of the above means -- there was a public conference call yesterday which I wasn't able to attend, and the full solicitation won't be released for another 2 weeks. We're still struggling nationally, regionally, and locally with the question of how to get this "health IT thing" done within a political-economic system that: 1) professes to be market-driven, 2) is timid about admitting how much is actually government-driven, and 3) thus has a hard time figuring out how to respond when the market fails. Perhaps the NHIN Round 2 program will provide some answers.

IT advances that are changing the rules

The exciting thing about information technology is that as it gets more sophisticated, it grows in ways that were hard to imagine at the outset. Collaborative technologies that exploit the connectivity of the internet are completely remaking the way that people work with their peers, interact with their customers and, ultimately, how they derive meaning from their craft. I have three computer-savvy kids who teach me this everyday. A few stories I've come across provide better documented evidence.

An article in last week's New York Times magazine (please see "Sex, Drugs and Updating your Blog") describes a musician who decided to write and publish a song a week, which led to a devoted fan following and a connectedness between him and his audience that is redrawing the lines of how he creates, markets and sells his music. Being directly connected to his fans allows him to target live performances to places where he knows he'll have a sell-out, and it also allows him to get immediate feedback on his music. On the downside, it's created an enormous responsibility to maintain direct connections with an ever-growing fan base who have come to expect a direct relationship with the artist.

Second, yesterday's Boston Globe had an article on "crowdsourcing" (please see "Crowdsourcing: Mining the masses for the next big thing"), defined as "throwing your arms open to the Internet community and inviting them to help create content or software." Music, software, video -- you name it, all sorts of products and services that are based on intellectual capital are being collaboratively developed by groups of otherwise unaffiliated contributors.

A specific example of this was described on National Public Radio a little while ago (please see "Musicians Collaborate from Afar on the Web" ). This was a story about websites that allow completely collaborative creation of music. Someone starts with a seed, like a bass line or a melody, and anyone else can upload overlays of instruments and vocals or anything else they can think of. "Songs" arise organically from the combinations of these layers, and indeed, one can imagine many "songs" being "created" from a single seed by mixing and matching these overlay tracks. Perhaps most fascinating, a listener can mix and match these tracks to generate a song that suits his or her tastes.

The web has expanded our current notions of "product" and "creator" and "consumer" to the point that these definitions start to merge into each other. I wonder how long it will be before these types of technologies start reshaping health care delivery -- longer than in the music industry, to be sure, but faster than most people appreciate at present. Collaborative input to diagnosis and treatment of individual complex cases, for example, which of course happens today, but is mostly limited to circles of colleagues who know each other. Or building rich libraries of treatment pathways, developed by mixing and matching layers of sub-pathways (pathlets?) from a wide variety of contributors. And this is all "b2b" or "physician2physician" collaboration -- what about "b2c" or "physician2patient"? The ability to have rich, 2-way, ongoing conversations with many patients presents many opportunities and, of course, many burdens and responsibilities as well. There are obviously many, many other examples, but I'm limited by my imagination (and the time-pressure to post this blog!).

One wonders whether the widespread use of such technologies will first require fundamental changes in the way medicine is organized today, or whether such technologies in the hands of younger physicians will fundamentally alter the structure of medicine. We have a tendency in the field of medicine and informatics to focus on how different health care is than everything else. As information technology becomes more useable and more sophisticated, it starts to look more similar.

An EMR Mandate -- Let's Go!!

Yesterday's Boston Globe had an article describing a draft Massachusetts Senate proposal to "mandate that doctors and hospitals switch to electronic medical records within five years" (please see "Officials say state must curb health cost"). The article describes this proposal as "the most controversial" among a set of proposals focused on cutting the cost of health care in the Commonwealth.

I think that a mandate may be the best solution to the EMR dilemma that we face today. While EMR implementation is obviously occurring today -- and Massachusetts is fortunate to have higher use than most other states -- progress is spotty, slow, and in many ways, ineffectual.

There is a growing digital divide in health care delivery. Large systems like Partners and Harvard Vanguard (sorry, I just can't call them "Atrius" yet) have the organizational fortitude and financial resources to successfully invest in EMRs. However, smaller practices (those with 10 or fewer physicians), and particularly primary care practices, don't.

Nationally, only about 25% of small practices have an EMR; 5 years ago it was about 20%, so we're not getting anywhere fast with this group. Unfortunately for us patients, 90% of our outpatient care happens in small practices, not in the large, well-resourced ones. Thus, at the current pace of EMR growth, it's going to be a looooooong time before most of us get the benefits that EMRs have to offer.

The dilemma is that physicians in small practices don't feel a whole lot of urgency to invest in EMRs at present. That's because it costs a lot to get up and running on a good EMR (almost $40K per doctor), and there aren't strong incentives or mandates compelling them to move faster. Unlike most businesses, physicians can't pass the cost of capital improvements on to their customers. Yet, on the other side of the equation, they can't stop the benefits of those improvements from flowing to their customers either. It's a perfect recipe for under-investment.

A mandate would provide the urgency for EMR implementation that the market can't provide today. However, a mandate needs to be coupled with an approach to assisting physicians get over the hurdles that have prevented widespread EMR investment in the first place. Without such a bulwark, a mandate will be a complete disaster.

I believe that a mandate needs to be coupled with an approach that addresses five key questions:

1. What is an "EMR"? This is still a nascent technology, and there are a lot of bad systems out there. We need to mandate that physicians implement only qualified EMR systems, and we need a way to facilitate that process.
2. What does "implement" mean? EMRs are only valuable if they're used in a way that creates value. So a mandate needs to cover not only what they implement, but also how they use it once it's in place.
3. Who's going to pay for this? An unfunded mandate will create chaos in the near-term, because you can't get blood out of a stone. If we don't create a funding mechanism that forces health insurers and employers to bear their share of the cost, we'll end up with a lot of physicians going out of business or leaving the state.
4. Who's going to implement this? Retail EMR implementations have a 30-40% failure rate today. EMR implementation is hard, and the practices that need EMRs the most are the same ones who don't have the expertise to get it done effectively. In addition to funding, a mandate needs to be backed by an infrastructure that can assist physicians with rapid, effective implementation.
5. What about health information exchange? One of the biggest problems with leaving EMR implementation to market forces is that the market doesn't address health information exchange, which is a pure "public good" that benefits society but that no one wants to invest in on their own. If we're going to have a mandate, it should include HIE, because that's where a lot of the value lies.

MAeHC has estimated that universal adoption would require that we outfit 8,000-10,000 physicians with an EMR who wouldn't otherwise get one on their own. We estimate that this would cost roughly $500 million if we include the cost of health information exchanges as well as EMRs (you need HIEs to get the cost reductions that everyone is looking for). This figure also includes the cost of an infrastructure to facilitate rapid and effective implementation. Spread this over 5 years, and it amounts to $100 million per year. Considering that we spend over $50 billion on health care in Massachusetts every year, this is a miniscule investment compared with the value that it will bring.

The universal health law will be merely a facade if we can't dampen health care cost growth. Indeed, current rates of growth threaten not only the universal health law, it affects all of our health care benefits. EMRs aren't a panacea, but they are key to ANY solution. That's why a mandate makes sense.

We are fortunate to live in a state that can actually provide practical solutions to make an EMR mandate effective -- there are few, if any, other states that can make that claim. An appropriately structured mandate that addresses the questions noted above will catapult Massachusetts into the next era of health care delivery and burnish our already well-earned reputation as a national beacon of health care innovation.

"Free" EHRs: A Faustian bargain on patient privacy?

One of the biggest barriers to wider adoption of electronic health records (EHRs) is affordability. Regardless of whether you "rent" (ie, pay a monthly fee for access to a web-based product) or "buy" (ie, purchase a license to put the software on your own computer), the first-year costs for a respectable system are $15K-$25K per clinician. It was inevitable, therefore, that some "free" products would enter the market. As it turns out, there's no such thing as a free lunch.

First came a non-commercial alternative, VistA-Office, which the government has already paid for. VistA-Office is the office-based version of the VistA system that has been so successfully deployed in the US Department of Veterans' Administration, and it can be downloaded without charge from a non-profit, government-sanctioned vendor called WorldVistA. Of course, there's more to the cost of an EHR than just the software, so though the license is free, a potential user would still have to pay for hardware, implementation, training, support, and maintenance. Nevertheless, it's always great, and economically efficient, when the government is able to create commercial spin-offs from work it's already funded.

If VistA-Office can be thought of as a non-commercial approach to "free" EHRs, Practice Fusion, a San-Francisco-based startup is its hyper-commercial opposite. Launched last August, the company's original plan was to offer their EHR without charge in return for access to the deidentified clinical data generated by users, which the company would sell to pharma companies, insurers, and researchers. If that isn't controversial enough, the company announced last Friday that they'll be partnering with Google's advertising arm, AdSense, to put context-sensitive ads on the EHR in real-time. As described in the San Francisco Chronicle: "When a doctor using the service calls up a patient's health record, AdSense will recognize certain keywords -- such as "diabetes" -- and ads related to that condition will appear on the page."

I assume that all of this is HIPAA-compliant, though it would take some convincing that no places or dates of service are being compromised when ads are being delivered to a physician's EHR in real-time based on what they type into the system. And we haven't event talked about state laws yet.

Regardless of whether it's legal, this approach does pose issues for physician-patient trust. For example, does a physician really know what they're getting into? The slippery slope has already been demonstrated. In August, the story was:

The “completely hosted, community-based model” EHR will be subsidized on the back end by selling de-identified data to insurance groups, clinical researchers and pharmaceutical companies, said CEO Ryan Howard.

Now, seven months later, it's clear that selling data isn't going to generate enough revenue.

Practice Fusion's deal with Google is what makes a free medical records system possible. Google's AdSense program will generate ads that will be displayed as the records system is used.

What's next if that doesn't work? If I'm already using the product, do I get a say in how it's expanded? If I don't like that, is my only option to leave, with all of the switching costs that that would entail?

Practice Fusion claims that health insurers will be eager to get into this action as well. Insurers have a hard enough time trying to keep patients on their formularies. How much harder will that be when drug ads are being inserted into the physicians' thought process at the point-of-care?

Purely on a user-interaction level, I'm not sure how many physicians will like having ads on their screen (actually, I am sure but I don't have any data to back me up). It's already a challenge to figure out how to present meaningful medical information on a screen without overloading the user. Dynamic ads won't help that.

Finally, but most important, how will patients feel about this? The first time a patient sees a Paxil ad pop up on his physician's screen, the questions will start flying. And the physician will be in the awkward position of saying that those ads don't affect his/her decision-making, that the company generating those ads is Google, but not to worry, through the magic of technology, Google has no access to private medical records (and the physician will be crossing his/her fingers hoping that that's true).

Practice Fusion's CEO says that "he does not expect data-sharing will be a concern to physicians who accept the free EHR." If that's true, it's only because they haven't asked their patients yet.

Farewell, Santa Barbara

For those who don't follow this stuff, last week marked the official demise of the Santa Barbara County Care Data Exchange (their website is already down -- there's some background here). The Santa Barbara project was a pioneering effort launched by (among others) David Brailer, the first and former head of the Office of the National Coordinator for Health IT.

The project struggled for many years with a variety of issues, but never did go live. After 8 years and over $10 million, the project leaders finally called it quits. A report in Government Health IT cites legal and technical costs associated with privacy protection as the final straw (see Privacy, funding doubts shutter Calif. RHIO). In a presentation given to the eHI Connecting Communities coalition (subscription only), one of the project's leaders emphasized that technology was not the issue, and that lack of a detailed and viable business plan undermined the project's long-term prospects.

I think there will be many lessons and cautionary tales coming out of this pioneering effort -- they'll probably dribble out over time. Sad to say but this could be the first of many "RHIOs" that throw in the towel for lack of a real business model.

Employers take the pledge

Secretary Leavitt on Thursday extracted a "pledge" from some large employers in Minnesota to push for better access to health care information for their employees. The article (Employers take on a new health challenge) reported this as follows:

Executives from 3M, Wells Fargo, Target Corp., Carlson Cos. and other Minnesota companies met with Leavitt and then signed a pledge to seek better health care information for their employees. The companies employ 3 million workers, Leavitt said, which will make them an influential force when demanding cost and quality information from health insurers and their networks of hospitals and doctors.

I'm assuming that the "pledge" is very general and doesn't specify what it means to "seek better health care information." I do think it's great to create a sense of urgency among employers and patients about the need for better health information, and this type of "pledge" seems like a great use of the Secretary's bully pulpit.

I don't know whether these employers are going to think of this pledge as mere paper, or as something that they're actually going to put some energy behind. If they do act, I hope they focus on investing in their own health care supply chains -- by thinking of creative ways to facilitate EHR adoption and local health information exchanges in their own communities, for example -- rather than on splashy but empty electronic edifices like personal health records (PHRs). Employers will get way more for their dollar by investing directly in improvement of health care delivery through greater health IT penetration, which will then make available the type of information that will ultimately make PHRs worthwhile.

I hope that these employers take their pledge to the Secretary seriously and use it as a way to coalesce around meaningful, collaborative initiatives, as they've done in Indiana (please see: Congratulations Indianapolis). It's becoming clear (to me, at least) that effective, widespread implementation and use of health IT won't happen until employers start to manage health care delivery as a supply chain issue.

How much would you pay for another year of life?

Lee Gomes has an article in Wednesday's Wall Street Journal about medical technology ("A Technology Writer Confronts Wizardry In Today's Hospitals" -- subscription required). After being admitted to a hospital for 10 days with pneumonia, Gomes marvels at the latest imaging and lab technology, but notes that the bill for his 10-day stay was $125,000 (not including physicians' fees). And then, he concludes:

...I doubt that I would have declined any of the high-tech wonders I was offered. Who would? And that attitude is a main cause of our soaring health care costs. The decisions that are in our best interest as individual patients, in the aggregate, help push things into crisis. We can't afford the remarkable system we've been smart enough to build.

Study after study has concluded that development and rapid introduction of advanced technologies are the main driver of health care cost growth in the US. Consumers don't face the price of such technology introductions because of insurance, but given the stakes involved, who among us wouldn't want our insurance company to pay any amount more to reduce our risk of dying by even 1 percentage point? The question is, as Gomes implies, how do we reconcile our individual desires to spend anything to increase the odds of saving our own lives, with the real affordability issues that it raises?

Economists have approached this question by sneaking up on people. Rather than asking directly, "how much should Harvard Pilgrim pay to save your life?", they look at how people evaluate risk every day, and then calculate what this implies about how much they "value" their lives. Or put another way, how much they would be willing to pay for this if they could make the assessment in a rational state of mind clear of the medical crisis that they're facing at the time, and they had to pay on their own?

For example, airbags are known to save lives, and there was a time when you would pay extra to have airbags installed in your car. Question is, how much were people willing to pay for airbags that would reduce their risk of serious injury by some known percent? Once you know that, you can make a guess as to how much value they're placing on their own lives.

Sounds dodgy, I know, but it turns out that researchers who've done this across a number of categories have found surprising consistency in peoples' valuations. David Cutler, an economist at Harvard, has done a lot of work in this area. He surveyed a number of studies and found that most value an additional year of life between $75,000 and $150,000.

So, back to the Gomes article. Is $125,000 too much to pay? Looking at his picture in the paper, I'm guessing that he's in his 40's, with many happy years ahead of him. Given the nature of his pneumonia (he was in the hospital for 10 days!), this technology probably reduced his risk of dying or having serious complications by a substantial amount compared to what he would have faced, say, 50 years ago.

Do the math and the conclusion seems obvious: Gomes got a bargain......

Question: Do you know where your credit card info is? Answer: Literally, everywhere.

Those of us in health care IT are obsessed with security, and rightly so -- we're dealing with some of the most personal information imaginable, and none of this works if it doesn't engender the trust of patients and physicians alike. So, I guess I'm more attuned to security policies and technologies than any normal person ought to be.

With that in mind, I was intrigued by the story that the restaurant chain Ruby Tuesday is moving to an "ultra-secure credit card processing system". (Maybe it's just me, but their adding the word "ultra" here doesn't make me feel better -- reminds me of Animal House, when Dean Wormer puts Delta House on "double secret probation"). As described by the company's hometown newspaper, The Daily News Journal, the system "leaves no credit card information at the restaurant and is instead sent to the bank in encrypted form."

I'll bet that most people would be surprised to learn that they weren't already doing this. You kept my credit card information? But you already got your money -- who gave you permission to keep it beyond that. You're going to start using encrypted communication? You mean, you don't do that now???

A USA Today story on the same topic reports that some restaurants like Hooters and Legal Seafoods are now looking at using mobile credit card systems that allow the credit card transactions to happen at your table. (Many possibile jokes here -- I'm not going there.) I was in Europe last summer with my family and I noticed that every restaurant we went to in Spain and France had such devices. I don't know why the US is so far behind.

The story also reports that Massachusetts (my home state) is considering a law that would penalize companies for credit card data breaches. That's interesting, because Massachusetts is one of a minority of states that doesn't have a breach notification law today (please see: Massachusetts among 16 states that don't have breach notification laws).

I've written before about my personal experiences at Marshall's and Home Depot where I learned how much info they keep (please see: Identity theft and digital records). Think of all of the loosely protected mini-repositories of credit card info out there -- basically every store you go to -- and how much of that information is flying through the ether without basic encryption protections. Patients and physicians should take comfort knowing that modern health IT systems and processes aim higher than that.

Are PHRs the chicken or the egg?

Interesting shifts in the focus of national HIT spending.

Federal attention (and presumably resources) has turned from EHRs and HIEs to personal health records (PHRs). The following report refers to comments by Dr. Robert Kolodner, President Bush's head of health IT:

Kolodner said that most Americans will have EHRs by 2014, and personal health records will drive that effort. Progress will increase in pace as a tipping point toward healthcare IT adoption is reached, Kolodner said.

You can see the whole report here: ONC fields tough questions Town Hall meeting.

ONC plans on backing these words with resources. The next round of federal contracts for health information networks are due out in April, and according to Kolodner, the next projects will be required to "empower patients to manage their own data." Speaking further, Kolodner said:

They have to enable the patient to identify how they wish to view their own information, to choose how the trust to share data, to control access to data by others, and for how long.... Individuals will also be able to correct errors in their health information. The actual correction process will at first be manual, but in the future it will hopefully be automated.

You can see the whole report here: Majority of market now adopting value-driven healthcare, Leavitt says.

This is somewhat of a shift in priorities from the original vision laid out by Kolodner's predecessor, David Brailer. The original Framework for Strategic Action created in 2004 had PHRs as the third goal, behind EHRs and HIEs.

I've written before about my belief that PHRs can't be the driver of HIT. EHR penetration is so low at present, and hospital systems are so hard to connect to, that there isn't enough electronic data available yet to make PHRs interesting to consumers (please see You can't get blood (or data) out of a stone and Hi, I'm from Wal-Mart and I'm here to help....).

Further, by framing this goal as having "most Americans" rather than "most physicians" on an EHR by 2014, ONC is going after the highest hanging fruit. According to the National Ambulatory Care Survey, 90% of outpatient visits happen in small practices, yet, according to the CDC, penetration of "good" EHRs is only around 9% generally, and much much lower in small practices.

I hope I'm proven wrong, because the point is to get it done in any way that works. Maybe we can get consumers to pound the table for PHRs. And maybe that pounding will get physicians to feel the urgency to get EHRs in order to meet their patients' demands for data to populate these PHRs. And maybe substantial federal dollars focused in this way can create a market.

With all due respect to Dr. Kolodner and his tremendous efforts and vision, I think it will be an enormous challenge to have most Americans on an EHR by 2014 even if we funded EHRs directly. Getting to that goal indirectly through demand generated by PHRs will be even more challenging.

Lessons from Scotts Miracle-Gro

Sunday morning's Weekend Edition show on National Public Radio had a story about a former employee of Scotts Miracle-Gro who is suing the company after it fired him for being a smoker. Scott's policies are also the cover story of last week's issue of Business Week ("Get Healthy -- Or Else").

If this doesn't convince us that we need to get employers out from between people and their health insurance, I don't know what will. If we expect employers to bear a large share of the burden of health insurance costs and administration, we can't complain too much when they try to pull (grasp?) at more levers to control those costs. (Indeed, part of the argument for keeping the current system is that employers are "smart buyers.")

The problem is, they reach a point where they can't squeeze out any more efficiencies through furthering tinkering with benefit design and supply chain management. Inevitably, they have to start trying to influence demand for healthcare, and they can't do that without plunging deeper and deeper into the private lives of their employees.

Employers are starting to realize that they've "hit the wall." Sometimes this manifests itself in hare-brained schemes, like Wal-Mart's Dossia PHR project. It's now escalated to the point where they too want out of the health benefits business entirely, and they're willing to ally with their adversaries to do it (witness the joint proposal from Wal-Mart and the largest union in the country to do away with the current health care system by 2012 -- "Better Health Care Together").

We've heard many times about how US-nameplate automakers spend more on healthcare than they do on steel. The cost argument doesn't bother me that much, frankly, because even if we moved away from an employer-based model, the costs would flow back to them in some way anyway. If we provided it through the government, as many other industrialized countries do, corporate taxes would undoubtedly go up to pay for a share of this. Taxes on individuals would go up as well, which would reduce disposable income, thereby reducing demand for cars, and ultimately cutting revenues to the automakers.

There is obviously inefficiency in forcing every company to become expert in optimal benefit design, but in a reasonably efficient market economy like the US, the "general equilibrium" result would be that corporations would for the most part end up close to where they are now economically. At the end of the day health care has to get paid for, and those costs can't get shifted away "cost-free".

So, while employers couch the need for change in terms of cost, I don't think that's why we should change the system. It's not the cost to businesses that is the most pernicious aspect of our employer-based healthcare financing system, it's the cost to all of us of having businesses become social engineers. If you don't think this is real, think about this: Scotts requires its employees to "pee in a cup" to test for nicotine. Urine tests to check compliance, not with the law, but with company policies.

The attorney for the former Scotts employee says that the company shouldn't be permitted to fire smokers, because of the slippery slope effect -- first it's smokers, then it's obese people, drinkers, motorcycle riders, and mountain-climbers. His solution is to disallow employers from doing this.

He's right, of course, that these lines are hard to draw. But companies need to have some levers to control costs. They could, for example, do other things short of firing smokers -- deny them access to health insurance benefits, for example, or make them pay the difference between a non-smoker's premium and a premium that accounts for their greater actuarial risk.

I'm all for compelling people to pay the extra cost of risks brought about by their voluntary behavior; it's economically efficient and fair. The real point though is that regardless of whether your employer's policy is to fire you or just charge you more, they still have to make a judgement about whether you belong in the high-risk category in the first place. And the more such risk-adjusted refinements they try to pursue, the more they need to know about the intimate details of your life outside of work.

In this way, employer-based insurance virtually forces companies to encroach on their employees' privacy. That, more than anything else, is why we should get rid of it.

Another "Mission Accomplished"?

President Bush on his weekly radio address last weekend declared that "America has the best health care system in the world...".

This week's Healthcare IT News has the following headline:

Majority of market now adopting value-driven healthcare, Leavitt says

Secretary Leavitt said that "we are close to achieving interoperable standards and a system-wide transformation," according to the article.

'Nuff said..........

Congratulations Indianapolis! (And I'm NOT referring to the Colts)

The Indianapolis Star last week had a story about the launching of a quality reporting system by the Indiana Health Information Exchange (IHIE). This is a truly exciting development, not only for Indiana but also for the many fledgling health information exchanges around the country.

The national health information exchange movement is at a fragile point at present, as the over 200 "RHIOs" across the country struggle with the question of how they'll sustain themselves once their grant money runs out. IHIE offers a shining example (arguably the shining example) of how a health information exchange can offer innovative programs that deliver value on business terms, transform health care delivery, and (hopefully) improve the quality and cost-effectiveness of health care over time. In short, they're starting to realize the vision.

The program itself is called Quality Health First of Indiana, and it builds on the community-wide results delivery service that IHIE already runs, and the Indiana Network for Patient Care created years ago by the now legendary Regenstrief Institute. The program will merge data from insurance claims with laboratory results from the IHIE system to create benchmarking reports to track physician performance. It will also generate alerts and reminders for physicians to improve tracking and follow-up of patients with chronic conditions -- this will give physicians better tools to monitor and improve themselves on the indicators that they're being measured on.

What's really unique and powerful about this program is the coalition of stakeholders that are backing it. In particular, the Employers' Forum of Indiana played a central and lead role in bringing purchasers and the health plans together with providers to agree on a set of measures that would be considered by all to be meaningful and actionable. IHIE had the platform to bring together the data, which made data collection and report delivery affordable and minimally invasive to the physicians. The health plans are funding the operations. They're paying IHIE to pull together, process, and deliver the reports. They're also paying physicians to participate at the outset ("pay to play"), and will then provide incentive payments for quality improvements over time ("pay to perform").

Another innovation is that they're bringing together claims data (from Medicare as well as local plans) and merging that with real clinical information drawn from the health exchange. That gives physicians a more complete picture of themselves than they're able to put together on their own.

In Massachusetts, we've done well on the claims and reporting side, but less well on the clinical integration side. We have the benefit of a groundbreaking program in its own right, namely, the Massachusetts Health Quality Partners. It's more far-reaching than the Indiana program in that it's statewide, the data is publicly reported, and it also brings in patient perspectives. MHQP isn't an HIE, though, so they don't have the clinical data and the resulting alerts/reminders capability that IHIE has brought to bear. The purchasers and insurers are also not nearly as engaged in the conversation in Massachusetts as they have been in Indiana.

The hardest part of achieving the health information exchange vision is lining up the economics. Insurers and purchasers (and patients) stand to benefit the most, but they have in most cases treated this as a problem that physicians need to solve themselves. IHIE and the Employers' Forum of Indiana together have cracked two nuts: they've gotten employers and insurers to invest in their supply chains by putting together a reimbursement package that allows everyone to realize value, and they've integrated claims data across payers, and clinical data across providers, and married the two in a way that no one else has yet accomplished.

So, if it's not already apparent, I'm impressed. Congratulations to Marc Overhage of IHIE and Dave Kelleher of the Employers' Forum! We're inspired by your vision, applaud your successes, and looking forward to learning more.