March 2012 Presented by Shawn McKenzie HFMA Northern California Spring Conference 2012 Silos to Synergy Next Generation Health Information Technology Budgeting.

March 2012Presented by Shawn McKenzie

HFMA Northern CaliforniaSpring Conference 2012

Silos to Synergy

Next Generation

Health Information Technology Budgeting

The Allegory of the Cave…The Allegory of the Cave…

Time to alter our reality?

Our Industry is Unique… not differentOur Industry is Unique… not different

Healthcare Has a Culture

Science and TechnologyFinance Hospitality

We combine them all

In the beginningIn the beginning

Physician’s Guild & ApprenticeshipPhysician’s Guild & Apprenticeship

Patient Focused

Competitive Silos… The beginning of the Scarcity ParadigmCompetitive Silos… The beginning of the Scarcity Paradigm

Practice Focused

Single Shingle

Continued Growth of Silos and ScarcityContinued Growth of Silos and Scarcity

Competing Interests in a Fixed Demographic

The Status Quo Business Culture of HealthcareThe Status Quo Business Culture of Healthcare

We conduct our business in the throws of the Scarcity Paradigm• Protectionist• Fiercely Competitive• Narrowly Focused

1% to 2%Market Share

Market Catchment

DemographicMostly

StagnateGrowth

Enterprise ~ The Ultimate SiloEnterprise ~ The Ultimate Silo

IDN-1

IDN-3

• Same Community• Duplication of Services• None or Limited Systems Interoperability

Scarcity Paradigm is our RealityScarcity Paradigm is our Reality

The culture of silo delivery is now culturally baked into healthcare!

• Critical patient information is now a hook

• Continuity of care struggles against the healthcare business culture

• Patients and physicians are left to bridge the gaps

• Physicians are forced to act on partial data

• Costs in duplicative diagnostic studies rise

• Decision support is minimized

• Organizations spend millions on competing services

Three Legs of Healthcare DeliveryThree Legs of Healthcare Delivery

Clinical Care Delivery is Wanting of change. More interoperability and sharing of critical patient information regardless

of the source

Technology is Working on solutions to create,

secure, share and trend clinical information regardless of the

source

The business element of healthcare delivery is

Waiting for the axe to fall and holding onto the same old model

The Changing Healthcare Landscape The Changing Healthcare Landscape

Explosive, Uncertain, Unpredictable, Multi-directional, Heated, Threatening, Ominous

The Changing Patient DemographicThe Changing Patient Demographic

Patient Demographic• Less Tolerant• Expectant• Advocating• Critical

There is a growing discontent with the delivery model of healthcare. Patient advocacy groups have developed internationally to create a unified voice and express concerns that healthcare requires more transparency, oversight, uniformity and interoperability.

With Significant Cost Reduction

Archimedes Movement

AARP

The Changing Technology LandscapeThe Changing Technology Landscape

Technological Movements• Integration• Consolidation• Interoperability• EMR/EHR• Health Information Exchanges• PHR – Social Exchange

The technology available today is capable of supporting the goals of interoperability

Technology Can Bridge the Silos But it Will Not Transcend The Business Culture of Scarcity

The Changing Policy of Healthcare ReformThe Changing Policy of Healthcare Reform

Government Authority and Policy• ARRA• HITECH• Meaningful Use• ACO• HIE

The political platforms evident in Washington see “Reform” as a cost savings action focused on altering the fee for service model while promoting an improved care continuum and interoperability effective through the adoption of health information technology

With Expectations of Lower Cost and Higher Quality

Reforms Driving Change… (The carrot and the stick)Reforms Driving Change… (The carrot and the stick)

(ARRA) - Recovery Act Funding and Meaningful Use• The “green glue” and the “Race for the Mercedes”• Funding more silos?• Seeking standardization (SNOMED-CT, RADLEX, ICD-10)• Attempting to accelerate IT adoption in the care continuum (providers and patients) • Improve care and drive down costs

Accountable Care Organization (ACO)• Payment structure changing (Episodic)• Financial distribution is yet to be defined• Care continuum is fluid• Cost, Care, Outcomes and Patient Satisfaction

Private and Public Health Information Exchange (HIE)• Philosophically a great concept • Creates opportunities and challenges for a sustainable business models • Rudderless and adrift

Technology and public sentiment related to care delivery supported by government reforms, funding and policy, will force change to the

business model pervasive in healthcare today

With the fluid ability to cross-pollinate and share patient data across entities, affiliated or not, the business model of healthcare will shift to a

Synergistic Paradigm

Budgeting for Next Generation HITBudgeting for Next Generation HIT

Tyranny of the Urgent• ICD-10• FDA – 5010• Meaningful Use• SB-1237 Radiation Dose Monitoring• ACO

EHREHR

EHREHR

EHREHR

Budgeting for Next Generation HITBudgeting for Next Generation HIT

• Adopt Standards as part of every system build (SNOMED-CT, RADLEX, IHE) • Systems consolidation (Shrink your footprint)• Fewer independent systems (Boutique, Best of Breed, Proprietary) Cardiology is a perfect example• An enterprise systems and archive strategy capable of interacting with an “exchange”• Operational cost versus Capital cost

Budgeting for Next Generation HITBudgeting for Next Generation HIT

Does your organization have an articulated & codified HIT Strategy taking into consideration reform mandates and business objectives?

Does this strategy have a clear step-wise approach to the roadmap including procurement requirements that address the future of healthcare?

Do each of your purchase decisions utilize an “end game” analysis?

Strateeegery

Will your strategy address business outside of your silos?

Budgeting for Next Generation HITBudgeting for Next Generation HIT

EMR Portal Interface

Single

ViewerLifecycle

Management

Envision your technology enabling function beyond the walls and corridors of your organization or business affiliations

Think

Health Information Exchange

(Private and Public)

Technology Supporting Community MedicineTechnology Supporting Community Medicine

Creation of Community Health Interoperability

Business Model with Complete ExchangeBusiness Model with Complete Exchange

EMR Portal Interface

Single

ViewerLifecycle

Management

When patient data of all types is available to any provider, regardless of affiliation through the exchange, the need to

repeat studies, duplicate efforts and treat on partial information disappears.

So Does the Scarcity Paradigm Business Model

If we have data sharing, what happens to the revenue stream? How do we create a business model to support being everything to everybody

when the cash flow diminishes?

A Financial Exercise using the Synergistic ParadigmA Financial Exercise using the Synergistic Paradigm

Dialogue and DiscussionDialogue and Discussion

Next Generation Health Information Technology Budgeting

Shawn McKenzieCEO, Ascendian Healthcare [email protected]