Cash crunch, cultural resistance “curbing” e-health progress

A couple of major obstacles are impeding widespread adoption of e-health programs in North America, experts say.

The first barrier is money, according to Newt Gingrich, former Speaker of the U.S. House of Representatives — the cost of these programs, and where the funds are to be obtained.

The second, he said, is culture.

Embracing e-health technology, Gingrich noted, requires learning new things, and adopting new habits. “It’s fundamentally different for workflow.”  


Gingrich — founder of Center for Health Transformation — was speaking at a recent panel discussion on e-health in Toronto.

Other panelists included Frank McKenna, former New Brunswick Premier and currently deputy chair of TD Bank Financial Group, and Peter Reuschel, founder and CEO of InterComponentWare AG (ICW).

Headquartered in Walldorf, Germany, ICW offers healthcare products designed to integrate various participants and systems in the heath care sector, including physicians, hospitals and patients. The firm actively promotes standardization in healthcare and has established the Global Standards Office.

Speakers at the Toronto event, which marked the launch of ICW in Canada, laid out the challenges, progress, and benefits of electronic health records. Those benefits, they emphasized, don’t come cheap.

They cited the “resource crunch” as a major and ongoing obstacle, despite investments by both Canadian and U.S. government jurisdictions.  

For instance, Ontario will be investing around $2.4 billion in healthcare over the next few years, noted Wayne Gudbranson, CEO of Branham Group, an IT consultancy based in Ottawa.

While that’s “wonderful”, he noted that IT spend in the healthcare sector has been far less than in other verticals — a situation that needs to change radically or “cost and efficiencies won’t be improved.”   

ICW’s Reuschel highlighted the role of government funding. “If you really want integrated health care delivery,” he said, “at least at the beginning, there’s a need for public money.”

In Canada, much of this funding is being channeled to Canada Health Infoway, a non-profit organization that collaborates with the provinces and territories, health care providers, and technology vendors to speed up use of electronic health records.

Infoway is to receive $500 million from the Feds to support a national electronic health record system, expected to be fully implemented across Canada by 2016.

The Canadian government has already provided $1.6 billion to support Infoway’s goals, according to the organization’s Web site.

Infoway’s development of the e-health certification process has been welcomed by ICW. The company said it would participate in the “formal certification process” for its own products.

In the U.S., the new administration’s stimulus package recently allotted US$17 billion to healthcare.

These funds have “changed the level of interest in hospitals and doctors across America in a fairly significant way,” said Gingrich during a press conference at the ICW event.

Financial drain, huge gain

The $17 billion will just be a start for most hospitals and physicians, according to Erika Skula, chief financial officer at Manchester Memorial Hospital in Kentucky.

The 63-bed hospital went live with the Cerner system in February 2007, but started preparing in February 2006.

For a small 100-bed hospital, the cost to implement an entire EHR system is close to $1.5 million, said Skula.

Part of a 36-hospital system based in Florida, Manchester Memorial is one of few U.S. hospitals to have a fully-implemented electronic system.

Skula said investment in such a system extends beyond the software costs.  It includes “buying technical assistance [and] the financial impact of having to prepare your staff.”  

The hospital spent ten months on prep work, including four months training staff as end users, another four to build the software, and a two-month testing period.

“We were simulating actual clinical cases and flowing them through the software to make sure everything worked and there wasn’t anything we missed.”   

Skula admitted the system was a “huge drain” financially, but said the hospital noticed a side benefit when it began catching missed billing items.

“In our old system, when we would bill patients for various procedures, it would be easy to miss a charge for one little piece of their visit.”  

In the U.S., everything is billed separately, so a small procedure can be easily overlooked, she said. But with Cerner, everything is keyed in and has to be signed off.

In the very first year, she said, the hospital saw more charges being billed and measured that. She estimates the positive financial impact of all these charges being picked up and billed is around $200,000.  

The main benefit, however, is real time health information.

“Patient records are available instantly,” Skula said. “You don’t have to wait for labs to send you the results before making a decision about patient care … that’s a very strong plus for [EHRs].”

A big challenge – apart from costs – is getting people to use the system.

Some people feel it’s more difficult just because they are used to picking up a pen and writing things out, rather than keying it straight into the computer, Skula said.

In her experience, it’s the physicians who are most resistant to change.   

Private sector contribution

While he’s convinced Canada’s healthcare system “works for us”, former New Brunswick Premier, McKenna believes much can be done to improve it.

For instance, healthcare would be considerably better of if it harnessed management tools used in the private sector, he said.

McKenna cited TD Bank’s use of measuring tools to assess quality of service. TD, he noted, performs 4,000 customer service surveys each night to measure customer service.

He contrasted this with the Canadian healthcare sector that doesn’t measure customer experience. Lack of competition, he suggested, is the most likely reason for this. “There’s no other place to go.”   

Measuring the employee experience is also important, he said.

Integration between disparate systems and bodies is also challenge, according to another panelist.   

Various players and systems in the healthcare sector don’t talk to one another, and companies trying to solve this issue often fail, according to ICW’s Reuschel.  

It took his firm a while to develop a master plan of how various pieces of the puzzle pieces work together, but ICW now provides products to integrate various hospital systems.

It also offers the ICW Developer Network for those “seeking to connect isolated healthcare IT applications.”

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