Healthcare Organizations and Their IT Strategy (or lack thereof)
- Posted On June 29, 2020
- Posted By Vu Nguyen
The information technology landscape has been evolving at breakneck speed over the past 15 years. With the introduction of electronic practice management scheduling systems and eventually the electronic medical record, healthcare providers have changed the way they care for patients. These measures have had a profound effect on patient care, medical errors, reimbursements and the way day to day business is conducted. There have been massive investments made within organizations and even individual physician offices to try and satisfy new regulatory requirements. Big data has become a big problem for some as they navigate the changing IT landscape. For other organizations that are proactive and engage in strategic planning, there have been distinct benefits to following new recommendations. The myriad of changes are causing drastic changes at times and every healthcare organization needs a plan to navigate them.
Changes in Regulatory Requirements
Over the past 5 years there have been new laws that govern how physicians conduct business. Doctors are now required to write prescriptions electronically or face a penalty in the form of zero remits from the Medicare program. To this day, some organizations have still evaded these requirements and are paying stiff penalties on an annual basis. Most electronic prescription writing platforms are fully integrated into an electronic medical record, which most practices are upgrading to anyway. And that brings us to the next series of changes.
In an effort to facilitate broad changes in access to healthcare data, the federal government created an incentive program for physician offices and healthcare organizations to move to an electronic medical record platform. Starting in 2016, if doctors are not documenting patient care information in one of these electronic records, they too will face penalties levied by the government. The regulations surrounding EMR use are referred to as meaningful use incentives. These measures are designed to make sure a provider is appropriately documenting the necessary healthcare data during a patient encounter. Meeting them requires providers to have training on how to appropriately enter this information so goals can be met.
Organizations and offices that have already moved to an EMR must “attest” to meeting their meaningful use incentives on a yearly basis by sending their data to the government. It is then verified and prior to 2016, incentives were paid out to physicians who have high patient volumes under Medicare or Medicaid. 2016 is the first year that penalties will be assessed against offices and companies who have yet to go electronic. Everyone needs a specific plan on how to manage the increase in meaningful use measures for 2016 and make sure their EMR platform has the necessary features to meet stringent regulatory requirements.
Data security has been of particular concern to the US government because of the importance of HIPAA and the increasing threat of electronic compromise of data. Every person in an office who works on an EMR is required to have a separate username and password to access patient records. This is essential so that upon someone’s exit from a healthcare organization or practice, their access can promptly be deactivated. Multiple persons in the same office or company using a single username and password offers the opportunity for private patient data to be compromised.
Many healthcare organizations will also need a robust standard operating procedure on records retention and its security. There has been a steady migration away from private servers to cloud based technology. Private servers can crash without warning leaving huge amounts of patient data in electronic limbo or deleted altogether. This creates an unacceptable level of risk from a security perspective to that data being compromised.
For firms that fail to institute an acceptable level of security, the fines for HIPAA breaches can be steep. A daily fine even for a reported breach (which is required) can be up to $50,000. While the investments of potentially millions of dollars in an EMR and robust security system are sizable, HIPAA violations can run up the tab quickly. Not to mention the bad press that would accompany such issues.
Patient Outcome Data and Reimbursements
The models of reimbursement are seeing wide changes, first in the federal programs. As with most changes to reimbursement models, they will likely originate at the federal level and then cascade down to third party payers as they follow suit. Outcome-based reimbursement models are seen as a cost savings measure because they reduce the need to order unnecessary testing. Insurance companies and the government want the overuse of laboratory testing and imaging in particular to be reversed and this model is seen as the framework to encourage that.
This means simply providing a service for an organization will not be enough to secure payment. This can put an enormous amount of pressure on healthcare firms that already have huge account receivable balances due to the migration of consumer directed healthcare. More patient responsibility has meant more “slow pays” and more debt for companies. Outcome based payments allow payers to further withhold reimbursements and create more stringent requirements.
Thankfully there is a silver lining and for organizations that use their PMS and EMR systems to track patient care, follow recommendations and train providers. They can actually earn more money with the disciplined capital deployment in a 360 degree IT strategy.
Technological Changes and creating leverage
The advent of EMRs PMS systems, and even health information exchanges (such as the one in Delaware) can cause both confusion and panic. Strategic planning is crucial to a managed transition from paper to electronic record keeping and documentation. Radiology orders, lab orders, SOAP notes and the like are all moving electronic.
The good news is whether the physician is writing a prescription or sending an MRI order, there is the opportunity to save time and earn more money. With proper training, providers can improve patient care, decrease medication errors (think of doctors’ handwriting) and create more time for patient encounters. For healthcare organizations looking to increase profits or create a surplus, the last in particular is a boon. With the capitation rate for many HMO plans running in the $5-$10 range per month per patient, more visits is necessary. Seeing more patients per doctor on a daily basis equals more money, plain and simple.
The electronic changes are also a boon to healthcare organizations operating at different levels in the patient care process. Many systems own physician offices, specialty practices and run their own imaging and lab work in-house. With EMRs, these companies can track data, control the continuity of care (through referrals) and increase their market share. Those organizations that make specific investments in training and user friendly systems will be rewarded with a path to increased profitability, leverage and market share through a successful IT strategy.