Is HCIT Adoption a State Issue?
By Ralph P. Fargnoli, Jr.
President & CEO
Beacon Partners, Inc.
During 2004, an election year, attention focused on the increased adoption of IT in health care. The main premise of discussion was that more investments in health care IT would reduce costs, improve patient safety and improve the overall health of Americans.
Improving health care is not a new topic for the federal government; over the years, initiatives, legislation, discussion and debate centered on “solving the problem.”
The latest effort was the creation of the Office of the National Health Information Technology Coordinator, charged with jump-starting health care IT (HCIT) initiatives and bringing to the forefront the importance of IT utilization. The HCIT czar developed the government’s 10-year plan with specific goals to improve patient health and safety, interoperability and information management -- all in an effort to achieve nationwide adoption of an electronic health record (EHR).
Did we really need the federal government to tell us what has to be done?
Looking at federal programs created over the years to address various social issues from education to health care (e.g., Medicare, HIPAA, Stark), can we say that the federal government would wisely use taxpayer money to achieve the goals outlined in the government’s 10-year plan? Or should the federal government fund state-sponsored initiatives focusing on specific challenges within cities and communities that directly impact consumers?
I support the state-sponsored approach.
Readiness
The initiatives identified in the government’s 10-year plan -- patient access, interoperability, EHR adoption, health information -- are generic at best. The challenge lies in creating national standards to address those areas rather than throwing money at them in the hope that something happens.
In a recent focus group sponsored by Beacon Partners, most of the CIOs in attendance thought the plan represented nothing new, and most were already trying to implement the goals long before they were outlined by the government.
When asked about the overall success of HIPAA, the CIOs thought the government’s approach was ineffective. The 10-year plan is an intricate technical and cultural initiative requiring an in-depth understanding of the challenges faced in organizations of varying size and complexity. A central failure of HIPAA was trying to implement legislation with such a broad scope; it required flexibility, which led to misinterpretation and, ultimately, lack of consistency and effectiveness.
In regard to interoperability, the focus group CIOs considered the HCIT industry too fragmented. They said they would be surprised to see competing vendors working together after the initial hype. In reality, you have to wonder if any public HCIT company would forgo revenues and threaten profits while allowing other vendors to remain competitive. Can vendors all get along and survive? I don’t think so. In the coming 3 to 5 years, consolidation within the HCIT industry will be rampant. The bottom line is that vendors are not ready to work together now. Can they be ready in 10 years?
Additional focus group discussions included a review of the 10-year plan goals such as information-sharing; most CIOs who attended said that issues related to social and cultural challenges would be a barrier to success. They also questioned whether investments made in HCIT today would be able to meet standards developed in the future; some predicted that another round of large investments would be required.
Funding issues
Do we need the federal government telling us what is needed, or do we just need the money? History and experience tell us it is the latter. Capital and expenses are the major reasons why IT initiatives don’t get off the ground.
Recent surveys suggest that a majority of respondents want health care providers and the government to share in the cost of IT initiatives. And, even with cost-sharing, providers will need assistance in the form of federal loan money. However, this does not mean the federal government should provide low-cost loans with no justification, plan or measurable expectations.
States working with provider organizations should put together the plans and funding requests in order to control the initiatives that make sense for their consumers and communities. Interest and payment terms for the loans can be initially determined by the scope of the submitted plan, but the loan can be modified by the government if it is deemed that the provider organization did not meet the goals as stated. Knowing how hard it is to get this industry to adapt to change, we cannot set the bar too high in terms of measuring success. We need to ensure that the results of any initiative provide the benefits that positively impact the consumer.
The reality of our health care system is that most health care providers get their revenues from Medicare and Medicaid, so the government pays most of the bill. Accordingly, payers who will benefit from more IT on the provider side should pay a proportionate share. The people on the front lines from the IT department, patient accounting, patient care, supply management, etc., have the expertise and knowledge of the real-world environment…but they lack the money and support to implement what is needed. The federal government has a history of providing low-interest loans to industries that need funds to survive. Why not the health care industry for the benefit of its own citizens?
What lies ahead
How much attention will the 10-year plan sustain over the next year? The National Health Information Technology Coordinator did not receive the $50 million funding that President Bush requested out of $308 billion in spending appropriations. This is a clear indication of the federal government’s lack of commitment to make the 10-year plan a reality. Regardless of the constant discussions about health care cost disparity, patient deaths due to medical errors, or lack of access for some Americans, fixing the health care system does not seem to be the most important social issue on the congressional agenda.
The only hope is to push this initiative to the state level, where the consumer can be better informed. At the state level, we would see an effort to rally voters for continued funding for local initiatives through educational sessions, patient and physician awareness literature, and updates to local media about the progress being achieved.
Each state has its own set of challenges that relate to health care for consumers, and for provider organizations. Having the states sponsor initiatives with funding provided by the federal government will ensure that best practices at the local levels will be achieved -- and that consumers will see and understand the impact of HCIT on their communities and their medical services.
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About the Author
Mr. Fargnoli is president and CEO of Beacon Partners, the national health care management consulting firm he founded in 1989. He is a 26-year veteran of the health care industry.
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