The IT Transformation Healthcare Needs

Highlights:

Organizations within healthcare can be rigid. These organizations are not just hospitals or clinics, but all healthcare organizations in the value chain, including pharmaceutical companies, medical device and equipment manufacturers, medical supply companies, etc. Improvement in efficiency and costs savings has been slow, and many times nonexistent. The lack of innovation and processes by incumbents to make use of data is partly to blame. Analyzing the vast amounts of available organizational operations data and/or patient data to identify trends and find ways to create value for the system and its participants (clinicians and patients) is a start, and has the potential to significantly cut costs and improve clinical outcomes. Getting past the rigidity and information technology infrastructure issues in healthcare with the right investments will enable incumbents to harness the opportunities that accompany a full-scale IT transformation.

Major Findings

The digitization of patient data has not led to significant improvement in patient outcomes. Even cost cutting effects of digitization have been minimal according to research cited in Sahni, et. al. The research mentions that many hospitals have been implementing digital health platforms and collecting data, but have not actually been analyzing the data to form insights (ways to do this while maintaining data privacy and integrity has been a major roadblock).

Further research into the issue of why hospitals were experiencing a poor return on investment after digital records implementation showed that most providers focus on two things: improving billing efficiency and improving clinical procedures. Billing efficiency can include things such as maximizing health insurance payments or Medicare reimbursements for procedures. While clinical procedural efficiency can include things such as ensuring stricter protocol adherence to reduce hospital acquired infections post operation or improving procedure techniques to ensure less trauma during operations leading to shorter hospital stays.

While these areas can improve revenue, they are equivalent to using a water pail to save a sinking boat. Billing efficiency will not be able to overcome YOY operational cost increases contributing to slim/ negative hospital margins. These issues illustrate the gap that exists in digital transformation at many hospital systems. This gap creates a “value impedance” for hospital systems because the technologies to link various digital strategies together exists in the market, but due to limited budgets and low/ negative profitability, organizations perform a half-hearted effort in digitization. MedTech companies will play an important role in bridging these gaps since they are already deeply integrated in legacy systems within the healthcare industry and understand the dynamic regulatory environment and how to navigate it.

Empirical Basis for Findings

Most hospitals have focused on reducing costs over the past few decades. They have done so by implementing electronic medical records, which were also mandated by law in 2009. Most of this data collection (to input into the EMR) has been done actively, with most of the data being used to paint a picture of a period in the past. However, having real time data when it’s needed is essential to quantify the impact of improvement as well as to take insights generation to the next level. Moreover, improvements to hospital efficiency and clinical outcomes for patients doesn’t solely depend on cost cutting and improving clinical procedures. It requires data – both passive and active collection of data – and this requires links between the various technologies that they implement to close the ‘gaps’ in digitization that currently exist (siloed data).

Implications for Practice Management

Organizations need to analyze the immense amount of non-identifiable patient-health and patient-visit data they collect every day to identify trends - where the organization is performing well (i.e., experiencing better patient outcomes), versus where they can improve. This type of analysis will allow for better distribution of resources across the organization. For example, if admission and bed data is being analyzed, and the results show high occupancy and also high wait times for new patients, this might indicate that more nurses might be needed in a specific department as compared to a department with high bed vacancy and no wait times.

The main insight that was recommended through Sahni, et. al. was that hospitals need to ensure they take the next step with their data – make the data actionable. This will help close the current gaps in digitization. Use data to improve how a hospital performs in many different categories such as patient outcomes, resource allocation, inventory management, prescription stocking and management, wait time improvements, etc. But all this is most effective when improving quality using data becomes an organizational goal – most importantly, senior leaders of the hospital and their physicians (not just appointing a “CIO”).

Lastly, most of the information in patient records is collected actively at the hospital by clinicians or staff inputting data into the system as it is received from either the patient or from hospital monitoring systems. Research suggests that hospitals and clinics should implement more processes to be able to passively collect data by letting patients collect it for them through the use of mobile apps, at-home monitoring devices, etc. For example, if a patient requires constant blood pressure monitoring because they are at risk for cardiovascular disease, they can be prescribed a wireless blood pressure monitoring device for at-home use. When this device collects data, it can be recorded, synced, and sent directly to the patient’s medical record for their primary care physician to view in real time. This enables a ‘fuller’ patient record with real time data and trends that can be periodically monitored. This is the next level of patient care which involves recording more data to be able to provide better insights to physicians to choose optimal treatment options.

Bibliography

Sahni, Nikhil R, and Robert S. Huckman, Anuraag Chigurupati, David M. Cutler. “The IT Transformation Health Care Needs.”Harvard Business Review. 95.6 (2017): 128–138. Print.