Thursday, May 30, 2013

Health IT – The Right Tool for the Wrong Job

Every article, discussion, blog post, comment and casual remark on the subject of Electronic Medical Records (EMR) and their prominent role in health care reform is never complete without stating that EMRs were designed for billing and hence are poorly suited to contribute to patient care. Most health IT apologists are either trying to refute these allegations or are pointing out to new products and paradigms that will be designed from the ground up for something other than billing. Let’s try a different approach.

To paraphrase Coach Green, EMRs are what we thought they were, and we shouldn’t let 'em off the hook! EMRs are designed for billing, and they should be designed for billing and as financial administrative tools, they are uniquely positioned to solve our health care problems, if properly utilized, because the health care crisis in this country is a financial crisis. It is a financial crisis at a national level and for too many people it is a financial crisis at a personal level.

The Meaningful Use program provides incentives to health care facilities and physicians to purchase and use EMRs, concentrating exclusively on the recording, exchange and management of clinical information. In its first proposed iteration, Meaningful Use included a couple of financial measures (i.e. electronic claims and eligibility checks), but those were dropped very quickly never to be seen again. So Meaningful Use EMRs are all about patient engagement, care coordination, clinical quality measures, safety, public health and population health. Meaningful Use EMRs are supposed to support, encourage and facilitate the current federal initiatives to promote care coordination, wellness, preventive care and patient participation in clinical decision making, all of which are presumed to counteract the rising of health care costs by reducing the volume of medical services. Two and a half years into the program, the discouraging evidence is beginning to surface.

The current issue of JAMA Internal Medicine includes an 8 years study of patient participation in decision making. It turns out that younger, whiter, more affluent and more educated patients prefer to be more engaged in medical decision making and that this participatory stance is creating longer hospital stays and higher overall costs. Hardly surprising to anyone but policy makers, who envisioned  selectively informed armies of consumers as the antidote to already wealthy, but still greedy, physicians who order all sorts of tests and procedures, with complete disregard for patients' well-being and for the sole purpose of further enriching themselves. Much of this thinking rests on the massive research coming from the Dartmouth Institute for Health Policy & Clinical Practice, which retrospectively examines Medicare's expenditures for people shortly before they die, and finds significant variations in spend across the country, which were subsequently attributed by Dr. Atul Gawande to geographic variations in doctors’ greed, and then classified as waste, and arbitrarily quantified as 30% of all expenditures, by Peter Orszag. A brand new research paper from the Center for Studying Health System Change, deals yet another heavy blow to the Dartmouth/Gawande/Orszag thesis, which has been criticized before, by finding that geographic variations in cost of care are mostly due to the simple fact that in some areas of the country, people are actually sicker. Shocking indeed, and even if (honestly) engaging patients in decision making could save money, there is no money to be saved. 

So if we come up empty on the patient engagement front, how about wellness and prevention? Meaningful Use EHRs are continuously modified to collect increasing amounts of structured clinical data, and required to have capabilities for exporting these important data points. The idea is to be able to conduct health risk assessments, evaluate population health, trigger preventive screenings and perhaps we can reduce the volume of medical services by simply keeping people healthy, or at the very least leave the door open to charging more money, or withholding services, from those whose illness (or lack of adherence) may be attributed to “lifestyle” choices. An exclusive article published by Reuters on May 24th, reports a brief sighting of a RAND Corporation report commissioned by the administration, as part of the health reform law, to examine the effectiveness of workplace wellness programs. The RAND report, which seems to have been delivered to the appropriate government agencies in the fall of 2012, found that these wellness programs save no money to employers and have no significant beneficial effects on employees’ health. Unfortunately, the RAND report is not available for anyone to read because “Reuters read the report when it was briefly posted online by RAND on Friday before being taken down because the federal agencies were not ready to release it”. Well, perhaps after today (May 29th) they will be ready, because the said federal agencies just released the final rules on employment-based wellness programs, to “ensure flexibility for employers”. So the hunt for more patient data from EMRs is on, and “health-contingent wellness programs” will be replacing health-contingent insurance premiums (a.k.a. preexisting conditions). Never mind that these “federal agencies” were appraised months ago that these programs don’t work.

In addition to contributing to these worthy endeavors, Meaningful Use EMRs were supposed to reduce duplication of tests, reduce medical errors, reduce disparities in care, facilitate clinical research, and a host of other great things that could reduce costs of health care, all of which are yet to materialize. Instead, the onerous and expensive requirements to collect structured clinical data are taking away time from direct patient care (decreasing quality of care), forcing small practices out of business (increasing costs of care) and generally speaking turning clinical documentation into “pure torment”. Should we just write off EMRs as useless nuisances and revert to paper? Not at all…

In a beautiful essay also in this month’s JAMA Internal Medicine, Dr. Robert S. Foote is calling on physicians to take responsibility for “the separation of the clinical record from the nonclinical uses to which it is increasingly being put”. Considering that those nonclinical uses are yielding no benefits whatsoever, we should all share in this responsibility. Let doctors take care of the clinical record and let health IT concentrate on what it was built for and what it does best. Last year, in another JAMA article, Dr. Berwick introduced a model that defined and estimated the various sources of unwarranted health care expenditures, two of which were administrative in nature, fraud and abuse, and administrative complexity, potentially amounting to over half a trillion of wasted dollars every year. EMRs, if you recall, were built for billing, so let’s unleash that particular power, instead of foolishly trying to convert them into something they cannot be at this point in time.

Administrative complexity is bogging down every physician in every office. Why do doctors need to credential with every insurer separately? Why do they need different “provider numbers” for each payer? Why should every claim undergo “payer edits”? Why should every eligibility request return answers in a different format? Why should every rejection of a claim have one of hundreds of different and unclear explanation codes? Why should “medical necessity” rules be different for every payer? Why does it take months to have your lockbox switched to another bank? Why should people have to spend hours on the phone trying to figure out what happened to their claims? Why can’t claims be adjudicated and electronically paid in real time? While bemoaning the lack of standardization of clinical vocabularies, how can we justify the abysmal lack of standardization of simple financial transactions? Do we really believe that that’s how banks and ATMs are working? Is this how electronic trades are made on our beloved Wall Street? Do we think that Walmart or Amazon would tolerate hundreds of millions of dollars in fraudulent charges from their suppliers? Do we know what systems they are using to prevent those abuses before they even happen?

These types of questions have been asked and answered in every computerized industry that health care is being compared to. Fiddling with esoteric clinical decision support algorithms when we can’t even invoice and pay our bills in a common format is beyond negligent. Devising ways to shift risk and expenses to unsuspecting citizens, by keeping taxpayer funded research results from the public, and by using novel interpretations of the English language to cover up true intent is borderline criminal. Health IT needs to wake up and understand that although billing and financial management software is not as sexy as software that practices medicine, standardizing and simplifying administrative tasks for physicians is where “fixing” health care can realistically occur. There will be no support for this effort from our "fee-for-service" government, but try to remember that every dollar you save on administration could translate into one extra minute a pediatrician can spend with a baby.

Addendum 5/30/2013: Right on schedule, the RAND report has now been released for publication - Link to Report

Tuesday, May 28, 2013

Spinning EHR Adoption Numbers

On May 22nd, the Secretary of Health and Human Services (HHS) published a momentous press release announcing that “Doctors and hospitals’ use of health IT more than doubles since 2012”. The release was accompanied by two beautiful graphs, one for physicians and one for hospitals, titled “Adoption of Electronic Health Records by Physicians and Other Providers” and “Adoption of Electronic Health Records by Eligible Hospitals”, respectively. Both graphs, shown below, start at zero (0) adoption in January 2011 and climb rapidly to “[m]ore than 291,000 eligible professionals and over 3,800 eligible hospitals” by April 2013.

Of course, the graph titles are incorrect, since there were plenty of electronic medical records in use well before 2011, and the actual text of the press release does make some references to the world prior to 2011 (more on that below). The White House, eager to display such enormous success, posted the announcement on its own blog and fixed the titles to indicate that these are graphs depicting distribution of HITECH incentives for Meaningful Use, not necessarily Electronic Health Records (EHR) adoption rates as HHS mistakenly labeled them.  And while at it, the White House blog saw fit to make the pictures a bit narrower so the growth slope is properly showcased.

The problem with these graphs, whether in wide or skinny format, is that they mean absolutely nothing, except that HHS was awfully busy dolling out incentives between 2011 and today. Thankfully, the HHS press release is attempting to shed more light on the actual adoption rates of EHR. Let’s look at the ambulatory sector first, and then examine EHR adoption in the hospital market.

Office-Based Physicians

The HHS press release states that, “[a]ccording to the Centers for Disease Control and Prevention (CDC) survey in 2012, the percent of physicians using an advanced EHR system was just 17 percent in 2008. Today, more than 50 percent of eligible professionals (mostly physicians) have demonstrated meaningful use and received an incentive payment”. Examining the 2012 CDC survey results, shown below, it turns out that when talking about “advanced EHR”, HHS is referring to what CDC termed “basic EHR”, which is fine as long as we translate correctly.

The CDC survey results clearly show that somewhere around 2004 EHR adoption among office-based physicians began climbing at a more or less constant rate, with over 40% of doctors using an EHR back in 2008, although most were probably missing this or that functionality classified as basic by the CDC (and advanced by HHS). Beginning in 2008, prevalence of Meaningful Use worthy EHRs (advanced/basic) began increasing at a similar rate. If we place the 50% adoption rate of 2013, inferred from payment of incentives by HHS, on the CDC green line graph, it should fall into the same linear growth behavior as previous years. We will have to wait for the 2013 CDC survey, but my guess would be that while the blue “Any EMR/EHR System” line will flatten significantly, the green line will shoot up and eventually converge with the blue one. The reason for this is that there really are no serious EHR products today that don’t fit the "basic/advanced" criteria, and most people that have a non Meaningful Use compliant EHR, are upgrading to a version that has all the bells and whistles.

So what can we say about the effects of the HITECH incentives on EHR adoption in the ambulatory market? First of all, we can say that the HHS press release title claiming that “use of health IT more than doubles since 2012” is completely false. If “use of health IT” (the blue line) doubled, we would have over 150% adoption. If we understand “health IT” to mean Meaningful Use compliant health IT (the green line), and say that it doubled, we should have close to 80% adoption, which we do not have. We can’t even say that HITECH incentives increased the rate of adoption of “health IT”, since the slope of overall adoption hasn’t changed much since 2004. We could say that Meaningful Use incentives encouraged increased adoption of, and upgrades to, more "advanced/basic" EHRs, starting in 2008, a full two years before Meaningful Use criteria were finalized. Perhaps we could speculate and say that without incentives, the recession would have taken its toll and rates of adoption would have fallen, so the Meaningful Use program propped the market during hard times. This actually makes sense. Or we could just be honest and say that HHS paid lots of incentives really quickly, mostly to folks that “adopted” much of their health IT before the program was defined.


The hospital EHR adoption figures are even more dramatic. According to the HHS press release, “[f]or hospitals, just nine percent had adopted EHRs in 2008, but today, more than 80 percent have demonstrated meaningful use of EHRs”. The 9% figure for 2008, presumably comes from a 2008 survey commissioned by HHS and published in NEJM in 2009 (no source is provided in the press release). The researchers found that 1.5% of hospitals had “comprehensive” systems and 7.6% had “basic” systems, where comprehensive and basic as defined in the survey could be indicative of ability to satisfy the eventual criteria for Meaningful Use. Going from 9% EHR adoption to 80% EHR adoption for hospitals in 5 years would indeed be a miraculous feat. However, when it comes to hospitals, EMR is not a question of yes EMR or no EMR, but rather of how much EMR is deployed or used. Fortunately, the Healthcare Information and Management Systems Society (HIMSS) defined an EMR Adoption Model (EMRAM) for hospitals and it has been maintaining a lovely analytics database since 2006. The EMRAM defines eight EMR adoption stages, with Stage 0 indicating that the facility has not fully computerized even the three basic ancillary services (labs, radiology, pharmacy) and Stage 7 indicating full implementation of the most comprehensive EMR possible, including data warehousing and full interoperability.  Below is a compilation of the distribution of hospital EHR status from 2006 to the end of March 2013.

Unlike the ambulatory market, it is very clear that something major occurred between 2008 and 2009, with lots of hospitals transitioning from EMRAM Stage 2 to Stage 3 (most likely by adding PACS and nursing notes), and the transition to higher EMRAM Stages also began picking up pace around the same time. Originally HIMSS estimated that EMRAM Stage 3 would be required for initial Meaningful Use compliance and possibly Stage 4 (which includes CPOE). Isolating the number of hospitals that reached EMRAM Stages 3, 4 and above, yields the following results:

Since HHS announced that 80% of hospitals received Meaningful Use incentives by the end of Q1 2013, obviously EMRAM Stage 3 was sufficient for obtaining EHR incentives. Looking back at 2008, over 40% of hospitals were already at EMRAM Stage 3 at that time, a far cry from the 9% cited by HHS, so the best HHS can state is that between 2008 and 2013 the number of hospitals with a Meaningful Use compliant EHR doubled, which is a solid achievement in my book. HHS could have also pointed out the dramatic increase in the number of hospitals that deployed CPOE and advanced clinical decision support (EMRAM Stage 4), and the accelerated advancements to Stages 5 (closed-loop medications administration) and 6 (physician documentation), all very impressive even if not completely related to the current incentives.

Instead, the compulsive need to spin everything prompted HHS to declare that “use of health IT more than doubles since 2012”, which is ridiculous, and to put forward questionable historical numbers. A more cautious White House, while sticking with HHS provided numbers and crediting the President with this miracle, declares for no apparent mathematical reason that “adoption of electronic health records doubled among office based physicians from 2008 to 2012 and quadrupled in hospitals”. Of course every industry publication and health policy pundit (not to mention Twitter) is repeating these things, including the New York Times, where Mr. Thomas Friedman in a customary fact-free infomercial for his investor buddies is stating: “According to the Obama administration, thanks to incentives in the recovery act there has been nearly a tripling since 2008 of electronic records installed by office-based physicians, and a quadrupling by hospitals”. So which one is it folks? Doubled? Tripled? Quadrupled? Something bigger? Does it matter?

Tuesday, May 21, 2013

If You Want to Win, You May Have to Fight

“Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win.” –Sun Tzu

According to the National Committee for Quality Assurance (NCQA), there are around 33,000 Patient Centered Medical Home (PCMH) recognized entities to date, 5,560 of which are practices. Subtracting this and noting that many recognized entities are Nurse Practitioners (NPs), we can safely estimate that approximately 10% of the 209,000 practicing primary care doctors in the U.S. are working in a recognized PCMH. There are other accreditation bodies, but NCQA is by far the largest and best known, so the numbers above should be pretty indicative, give or take a few percentage points. My estimate is that another 80% or so of primary care physicians practice in unrecognized medical homes. Yes, 80%. Although it is difficult to get exact numbers, perusing the NCQA lists of PCMH shows that a large number of recognized medical homes belong to health systems, academic centers and community health centers.

According to the Office of the National Coordinator for Health Information Technology (ONC), 72% of office-based physicians were using some sort of EHR in 2012, and 66% either demonstrated or are planning to demonstrate Meaningful Use. As with medical home recognition, EHR ownership is also skewed in favor of larger practices, with solo docs in particular, lagging significantly behind.

And then there is the Physician Quality Reporting System (PQRS), with or without Maintenance of Certification (MoC), and the legacy electronic prescribing initiative, and the upcoming Value Based Modifier, all from Medicare. Private payers, and sometimes States, have their own slightly different pay for performance (P4P) programs. And all these programs are layered on top of a thick and knotty web of rules and regulations, specifying medical necessity, need for prior authorizations, medications formularies, the amount of text and the terminology needed to justify payments, and everything comes in as many flavors as there are health insurance plans.

Health systems and large medical groups have dedicated departments and staff to oversee and take advantage of all these programs, better known as quality initiatives, and that’s why they need to collect additional facility fees (and, according to the American Hospitals Association, also because of the “threat of terrorist attacks, recent mass shootings, the aftermath of Hurricane Katrina and the devastating tornados over the past year”). Small practices, on the other hand, have nothing but angst. The vast majority is resentfully struggling to keep the balls in the air in haphazard ways guaranteed to eventually fail, and a small (but growing) minority is  taking their toys and going home to practice cash-and-carry medicine. But here and there, you find the anomalous independent practice that is thriving; still chock full of resentment, but with a smile, because when you outsmart your opponent, it’s satisfying to acknowledge that this was (is) a powerful (dangerous) opponent indeed. So what’s the secret sauce? And is it scalable to all other soon to disappear independent physicians?

Let's begin with the medical home because some solutions are embedded in its concept, and because the brand new NCQA Patient Centered Specialty Practice (PCSP) recognition extends the same model to physicians who are not practicing primary care. First let’s assume that you chose to be a doctor so you can take care of patients, and this is still what you would prefer to be doing, but an extensive and growing bureaucracy along with shrinking payments, is preventing you from providing the care you believe you should be providing to your patients. If your aspirations are different, or if you are one of the few physicians who made the switch to cash pay, what follows will be of no use to you. 

For illustration purposes, let’s look at a solo practice, because whatever works for a solo practice, can be easily extrapolated to a larger group (but not vice versa). The first and most fundamental tenet of the medical home model is the personal physician, i.e. a person with an MD or DO, who is supposed to create a continuous relationship with an individual patient. It is worth noting that primary care practices led by non-physicians are by definition not Patient Centered Medical Homes, regardless of the current push to the contrary. Unfortunately, NCQA is deferring to State laws, and will recognize medical homes without a physician and/or medical homes where a non-physician is substituted for some patients, but NCQA does not dictate that non-physicians should provide primary care. So basically, it’s up to you to implement this any way you see fit. You are not required to hire non-physicians or delegate patient care to other people. PCMH merely asks that you build a long term personal relationship with your patients.

If that’s the case then how about team care, huddles and that sort of thing? To answer this question, I would suggest a small exercise. Exercise #1: read the PCMH standards and substitute the word “staff” everywhere you see “team”. Does it read better now? Replacing the term “staff” with the term “team” is a semantic innovation that is sweeping every business everywhere. It is not limited to health care and it should not elicit visions of an egalitarian system where nobody is in charge. In case you are not aware, every business executive that used to have staff and staff meetings, now has a team and team meetings. Same people, same reporting hierarchy, with added feel good validation for employees, usually in lieu of promotions and salary raises. If this rationalization is sufficient to deter the knee-jerk reaction to the PCMH language for a few minutes, let’s look at the measures associated with this PCMH concept.

In some cases when you try to address a behavioral or chronic problem for a patient, the first step is to have the patient keep a log of their current activities and gain awareness of what may need modification in order to effect beneficial change. Let’s try that. Exercise #2:  for a couple of days, keep a piece of paper in your pocket, and note all your activities as you go through your workday, then sit down and mark the ones that have nothing to do with actual patient care, and of those, mark the ones that have nothing to do with your medical education. Now ask yourself why you are doing these things instead of having your staff deal with them. Be honest. Is it that you don’t trust your staff to do things right? Is it that it takes less time to just do it, instead of having to explain everything every single time? Is it that everybody seems already too busy? Or maybe it’s just because this is how it always was?

Now let’s try something a bit harder. Exercise #3:  on that piece of paper you are carrying around, note your activities when the patient is in the room, in other words, analyze your patient care. Write down how much time you spent looking for information in the chart, how many times you had to step out to give some orders or request things from staff, how much time you spent talking about administrative things, or things that don’t require medical training, and how much time you spent collecting and cataloging standard information that has very little to do with the problem at hand (yes, I know, your EMR sucks; write it down). To be clear, this is not intended to shorten the time you listen to the patient or constrict the conversation in any way. This exercise is aimed at identifying tasks and activities that could be done by staff, preferably in advance of your visit with the patient, precisely so it can free a few more precious seconds for the two of you. I don’t need to tell you that seconds add up to minutes and minutes add up to hours and hours add up to missed opportunities. And yes, it is a sorry state of affairs when we must devolve to counting seconds.

The last exercise in our series will help you identify another very common problem. Exercise #4:  go to a couple social media sites where patients rate doctors (Yelp is a good one) and browse through the various comments. This is not to encourage you to submit to patient reviews, but to illuminate a very common problem in the form of a great doctor, but rude, unhelpful and impatient staff. You may be the greatest and most compassionate physician out there, and your patients will appreciate that and stick with you no matter what, but are you OK with staff that either does not know how, or does not care enough to treat your patients well?

After completing these four exercises, go back and read the “care team” measures in the NCQA standards (remember to substitute “staff” for “team”). Do you see anything that may be helpful with whatever problems you managed to identify through our little experiments? We’ll look at some possible answers in the next post. And by the way, if you are still questioning the necessity of doing anything other than keeping your nose to the grind and going faster and faster every passing day, you should note that once again medicine is changing. It changed before and it will most likely change again, and those who happen to practice the art, science and business of medicine during times of great change, are rarely pleased with the upheaval. Some will be decimated in the process and others will survive and thrive. Which one would you rather be?

Monday, May 13, 2013

10 Steps to a Blockbuster Health IT Startup

If you are tired of practicing medicine, or are compelled to be your own boss, or for whatever reason decide to try something new, you should consider becoming a Health Information Technology (HIT) entrepreneur, because health care is a $3 trillion industry undergoing great upheaval and widespread computerization, and as John D Rockefeller used to say, you should try to turn every disaster into an opportunity. As a physician, you have a significant head start when it comes to credibility, and if you are a tiny bit technically inclined, your value will easily quadruple. There are many ways to go about this, and you can follow your heart and try to “fix health care”, or relegate your entrepreneurship to hobbyist levels and work on some app for this or that, or you can judiciously research the market and pragmatically choose an endeavor most likely to yield quick and overreaching results. For the novice and uninitiated, below lays a semi-serious roadmap for hitting the elusive jackpot.

Step 1: Establish Thought Leadership

There is some foundational work to be done first and you should begin long before you actually quit your day job. Thought leadership today means that you have several thousands of followers on Twitter, Facebook, Google+ and LinkedIn. If you don’t have accounts for these social media sites, go ahead and create them, with your real name and credentials, and tie them all together to form a unified identity that can be leveraged across platforms. Start posting fast and furious. This sounds hard, but there are apps out there that will let you cross and schedule your posts. It is very important that you do not take any sides in any political or medical debates, and that you do not express any original thoughts at this early stage. Your messages (about half a dozen per day) should be just hyperlinks to articles and scant neutral commentary (e.g. “interesting study on medical errors”). With the right tools, this should take you about an hour per day. Once people start “following” your thoughtful stream of updates, make sure you eclectically follow the important ones back, but don’t start following a large number of famous people in advance. The sure sign of a thought leader is that he or she has many more followers than he or she is following. Keep this up and let it simmer while you move on to other steps.

Step 2: Educate Yourself

Although you can rise to thought leadership status without knowing much about anything, our long term goal is different, so this is the time to begin exploring issues in health care, most of which you are probably aware of, but you need a deeper level of understanding to initiate decent market research while enhancing your thought leadership. Don’t worry about identifying specific problems and don’t get hung up on possible solutions at this stage. Just read a lot and make Google your best friend. Start with simple searches (e.g. “medical errors”) and follow the links from quality mass consumption media (e.g. New York Times, Wall Street Journal, and Forbes), government sites (e.g. CMS, ONC), and reputable health care sites and blogs (e.g., AMA news, Health Affairs, etc.). As you become engaged in this activity, you will discover other publications that are useful, and don’t forget the big medical journals (e.g. JAMA, NEJM). This education phase will cross-pollinate your social media efforts in Step 1 quite nicely.

Step 3: Master the Language

This is the last step before you are ready to speak up in your own voice, and this may be the hardest part for a doctor. As you go through Steps 1 and 2, you will no doubt notice certain terms and phrases that are used frequently by current thought leaders, decision makers and others who recently completed all 10 Steps. Make these phrases your own. You must become conversational in this language to advance to Step 4. So for example, if someone wakes you up at 2 am asking you who the best cardiologist in town is, don’t just blurt out Dr. Heartfelt’s name and go back to sleep. Instead you should immediately state that this question in itself is an example of “lack of transparency in health care” and that “standardized measurement of provider performance is key to value-based decision making by consumers and purchasers”. If you are chaffing uncomfortably in your chair right now, remember that you chose to leave medicine and patients behind, because that too was very uncomfortable, and this Step is very much like learning a foreign language; you don’t have to think or dream in the new language, but you should be able to converse with the natives and eventually write a little too.

Step 4: Formulate a Problem

The first thing to note here is that you need not identify an existing problem, although it would be fine if you did, because many successful businesses provide solutions to problems people never knew they had. This is your opportunity to be creative and innovate. Remember that you are trying to build a business, and not just any business, but a blockbuster HIT business, so you are looking for rather quick and large returns on minimal investment, and there are three well-known strategies to accomplish this:
  1. Find a Blue Ocean – a completely new product where there is no competition
  2. Deploy a Christensen innovation – create a product that is much cheaper than what is currently available but still perceived as good enough by most people
  3. Identify an insertion point in a transaction intensive market and create a very sticky product to fill the hole with 
Unless you can create software to cure cancer, there are no Blue Oceans left in the shark infested waters of health IT, so #1 is out for most entrepreneurs. Christensen innovations are a-dime-a-dozen in health IT, and although some cheap innovations have worked better than others, health care is not a typical consumer market, and cheap stuff is considered almost sinful when life and death are on the balance. This leaves you with #3 which is particularly suitable for highly regulated markets, and ideal for chaotic ones. You may need to go through several iterations, but for illustration purposes, let’s pick one of the many possible roads you could take, and look at the exploding market of software for measuring physician performance.

Measuring quality of care provided by physicians is a government mandate. It is an excellent idea to hitch your business cart to funded federal mandates, particularly ones that are fuzzy, controversial and resented. The HIT market is flooded with EHRs that calculate quality measures and with dashboards and analytic tools that contend to do a better job. All these software tools cost small fortunes and when deployed on the same data, there is no guarantee that they will produce the same results. The raw numbers are rarely enough, and other sophisticated tools are needed to adjust results for comparison purposes. Major controversy exists regarding the quality of the measures themselves, the quality of the processing tools, the quality of interpretation, and to top it off, the measured are very unhappy with the entire affair. You may have your own hard feelings about the situation, which is a good thing, since being driven by a mission is infinitely better than a mercenary approach to entrepreneurship. What if you could step in at the point of purchase and provide assurance to both the measured and the measurers that the tools they are about to buy are reasonably fit for purpose? Not sure how to do this? That’s OK for right now, because first thing is first, and you need to create the need before you can ask people to pay you to satisfy it.

Step 5: Enhance Your Visibility

Now that you selected a business line, you will need an Internet presence and a platform to promote your innovation. You need a website and a blog. If you already have a personal blog or website that may be related to your practice, you will need to reevaluate the content and tone of your writing. More than likely you will be starting from scratch. Your website and your blog are your public image. It is imperative that you make a serious businesslike, yet innovative, impression. The current fashion dictates that your website is very white and very sparse, with very large high-quality dynamic graphics (please, no pictures of you sporting a stethoscope around your neck) and a small amount of tantalizing text in huge fonts. Your blog should also look Spartan and uncluttered. The favored color schemes are greyscale with small colorful accents, or the health care perennial favorite of smoky blue and ash grey with touches of faded neon green. Get this set up professionally and keep the website name on the generic side, just in case you come up with a better or somewhat different idea down the road. Start with a few awe inspiring sentences and build the content as you progress through the remaining stages.

Step 6: Build Public Awareness

Fear, uncertainty and doubt (FUD) is the synonym to “public awareness” in the world of sales, marketing and politics, as you should have learned in Step 2 and began practicing in Step 3 above. Continuing the quality measures example, and using the tools you developed in Steps 1 through 5, you should now launch a campaign to highlight the inability of any stakeholder to place trust in the hundreds of software tools employed to measure physicians’ performance. Don’t go overboard and discredit the shear notion of measuring performance, and do not alienate the software vendors (i.e. your future paying customers). At the same time, use your standing as a practicing physician (e.g. country doc, in the trenches, etc.) to elicit trust from your former peers, consumers and those who must privately (and begrudgingly) accept that when it comes to the actual practice of medicine doctors know better (e.g. payers, government, professional observers). You must use the language you learned in Step 3 and make sure that you are always perceived as an impartial, trustworthy and genuinely concerned visionary (it’s not as difficult as it sounds). Leverage whatever connections you managed to create so far, and those from your previous career, to make your voice heard. Publish, publish, publish…. However, do not let this Step drag out too long since there is always the possibility that a more expedient entrepreneur will help himself to the lunch you are preparing.

Step 7: Forge Relationships

The bad news is that you cannot do this alone. The good news is that if you did a good job in previous steps, and since you have an MD after your name, finding useful partners should be pretty straightforward, particularly if you set up your enterprise as a non-profit. You will need several types of partners and supporters. First and foremost, you will need a couple of big name public and/or private supporters (not necessarily financial supporters) to amplify whatever visibility you managed to create on your own, and to add credibility to your agenda. In our field of endeavor, ONC would be great, but decently sized technology companies with health care aspirations, such as IBM, AT&T or Microsoft may be even better. Large health IT vendors, maybe even sleeping giants like GE or Siemens are also good, and medical centers of excellence or reputable academic centers, like Kaiser, Mayo, Johns Hopkins, Intermountain or Duke, are a fantastic addition. In some cases, medical societies, private insurers and State organizations can add lots of value to your supporter list. If you are truly a country doc, you may need to dig up some old acquaintances from Medical school that chose a different path in life and renew some friendships that you may have discarded along the road. Expect to be buying lots of lunches and learn to not take rejection personally. Remember, you only need one good supporter to start the ball rolling. You will also need a couple of individuals (preferably somewhat known in the industry) with expertise in statistics, health IT standards and software testing, which will not be very difficult to find.

Step 8: Float Some Innovative Ideas

Once you have your infrastructure in place, it’s time to present your baby to the world. A word of advice here is in order. Health IT is a domain where intellectual property has no meaning; hence you better have your ducks in a row and ready to hop into the pond before you present anything specific. Going back to our example, after you, and your powerful sponsors, have convinced everybody that instilling some order in the chaotic market of quality measurement will save lives and money, you should now present your reasonably detailed plan to test and certify software that extracts and computes quality measures from clinical and administrative data. There are multiple methods you can utilize to make the case for the urgent need of a trusted and verified seal of approval for tools that affect the health of people and the revenues and expenditures of health care organizations. The nature of the partnerships you forged in previous Steps will dictate much of the marketing effort, but be prepared to help organize industry collaborative sessions and perhaps some conferences on the subject of quality and value-based payments (grind your teeth and keep your feet moving). Goes without saying that you will need to continue writing and speaking about quality and the pitfalls of disorganized and non-standard tools to measure performance, and hopefully by now you will be an invited keynote speaker at various industry venues.

Step 9: Deploy Your Innovation

Yes, Step 9 requires significant investment of funds. However, staying with our illustrative example, note that there really is no tangible product here, because there really is no problem that needs solving, so your only measure of success is going to be the number of vendors that voluntarily submit to your approval process. You will need a couple of market leaders to be early adopters (like anchor megastores in a mall), and if you picked your partners wisely in Step 7, you should be all set. From here on, you’re in maintenance mode with gradual expansion of value added services related to your original innovation.

Step 10: Enjoy the Ride

If all goes well with your startup venture, a liquidity event should become available to you in five years or so. Of course, every innovation is unique and your mileage may vary, but the principles are going to be very similar to those described here. You will have a few ups and many downs, long stretches of self-doubt, humiliation and borderline clinical depression, punctuated by the giddiness of a sudden breakthrough. The odds are overwhelmingly against you, and very few startups go beyond just starting up, but all in all, this is a most exhilarating journey.

These items are provided solely for entertainment purposes and are not intended as a substitute for consultation with a medical professional, preferably a psychiatrist specializing in midlife crises.

Tuesday, May 7, 2013

Indentured Servitude: A Silicon Valley Innovation

“…economic forces determined outcomes with relatively little constraint from political considerations; such was the case, for example, in the original innovation of indentured servitude, in the substitution of slaves for servants…“ -- Galenson, 1984

The Sunday New York Times is reporting that technology firms are supporting, lobbying, advertising and heavily influencing the immigration reform bill now before Congress. When you think about the large Silicon Valley corporations and the 0.0001% that run these firms, progressive images usually come to mind, based on public statements, writings and less frequently, charitable acts of these magnates. Think again. Under the guise of promoting a humane and yet pragmatic solution to the general immigration problem in the U.S. which has almost nothing to do with technology companies, the leaders and investors of high tech corporations are attempting to strengthen and expand an institution that benefits their corporations (and personal wealth), regardless of its effects on the American people and human rights in general. In between “Secure the Border” and “Pathway to Citizenship”, lays a completely unrelated proposal to increase the allowance for “guest worker” visas, mostly used by high tech companies to import cheap labor from less developed countries.

The “innovation of indentured servitude” was introduced around 1609 by the Virginia Company in an attempt to increase labor mobility from England to the colonies. With some exceptions, the indenture system was simply a credit mechanism by which willing and able workers could purchase the costly passage to the New World and its endless opportunity, in return for several years of labor for a colonial master, at the end of which they became free to buy land and most likely their own fresh indentured servants. This labor management innovation worked well for upwards of three centuries, and when the costs of temporary indentured labor were judged to be too high by employers, the innovation of indentured servitude for life, a.k.a. slavery, was added to the labor market mix.

We’ve come a long way since, and after going to war with ourselves we decided that slavery, as practiced by plantation owners in the south of the country, is unacceptable within a nation built on freedom and liberty for all people. Indentured servitude though, survived into the early 20th century when the unskilled labor of desperate people was no longer a rare commodity in America. Over the years we enacted reams of legislation to protect wage workers from abuse and in the process built a “middle class” free to pursue a dream of happiness and better futures for its children. And for a brief moment in time it looked like the American experiment was going to succeed. But the insatiable need of corporations for cheap labor was not to be denied.

Fortunately, modern transportation and advances in technology rendered the corporation itself portable, and freed it to go where labor markets where not hampered by the regulations put in place by free people to protect and benefit themselves. So the corporations relocated production plants to places where governments where more understanding of the timeless business imperative to exploit cheap labor without bothersome regulations. This worked well, and it still does today, for unskilled manufacturing jobs. The suspicious and well protected workers in the free world were appeased by the availability of ever cheaper imported products and the temporary replacement of minimum-wage sweat-shop jobs with better paying skilled technology jobs. Temporary, because technology jobs are even more portable than manufacturing jobs, and as soon as cheap semi-skilled technology labor pools became available in various developing countries, corporations were quick to migrate their activities from their home countries to the greener pastures of unregulated labor conditions.

But the captains of these new global corporations have no desire to relocate themselves and their families to where sewers flow through the streets, and as portable as high tech may be, there is still a preference to have workers in close proximity to their masters. Allowing laborers to freely immigrate from one country to the next (as in the 19th century wave of European immigration to America), did not work very well for corporations, because those free laborers quickly organized and integrated themselves into the political system to obtain higher wages and better working conditions. Hence the renewed interest in the 17th century innovation of importing indentured servants into rich countries. Since outright slavery and explicit bondage are illegal nowadays in most countries, a different terminology had to be created and some operational adjustments had to be made.

Building on the mid-19th century model of labor importation from India and China to South America, where the indentured servant received wages and benefits (return passage fees) directly from his employer, was bound for a specific number of years (usually four or five) to one employer, and subject to strict performance measures, a politically acceptable system of “guest workers” was created and perfected in 20th century America. The United States laws regarding the importation of labor underwent many changes during the last half of the 20th century, alternating restrictions with relaxation as the country changed its social stance and as the economy fluctuated. In its current form, the skilled workers importation program for employers came into existence with the Immigration Reform and Control Act of 1990, and set a limit of 65,000 so called H1-B visas per year, and smaller numbers of other visas and permits for exceedingly high-skilled workers. Just like the 17th and 18th century indentured servitude contracts, the modern H1-B visas, allow workers to switch employers (easier than in earlier centuries) and provide a path to citizenship at the conclusion of the bondage years (much more difficult in the modern era).

In October of 2000, high tech corporations trying to weather the dot-com disaster, needed to find ways to lower costs of operations. While most Americans were distracted by the Bush-Gore spectacle, Congress was able to oblige its benefactors and temporarily increased the importation levels of cheap skilled labor for technology companies, as a surrealistically honest Senator told the San Francisco Chronicle:"Once it's clear (the visa bill) is going to get through, everybody signs up so nobody can be in the position of being accused of being against high tech," said Sen. Robert Bennett, R-Utah, after the vote. “There were, in fact, a whole lot of folks against it, but because they are tapping the high-tech community for campaign contributions, they don't want to admit that in public."” Silicon Valley and its largest technology firms, lobbying in favor of the bill argued that in spite of the collapse of multiple Internet companies, there were “critical worker shortages” in high tech. Personally, I don’t recall actual shortages of labor in 2000, but I do recall spiking labor prices right before everything went crashing down in flames.

So here we are a decade later, mired in a pernicious recession where the stock market is skyrocketing, alongside widespread unemployment and raising poverty, and the billionaires of Silicon Valley are whistling the same old tune. Never mind that there is no indication of shortage of labor in technology markets, where wages have been stagnant since the dot-com crash, and never mind that over one third of Americans who graduate with a technology degree either can’t find a high tech job or are able to find a better paying job in a different sector. Flooding the American high tech market with large numbers of young people, some talented and skilled and some not so much so, bound to a mighty employer by onerous bureaucratic processes, under penalty of being shipped back where they came from if they speak up or complain in any way, is necessary for one reason, and one reason only: lowering the price of labor, both native labor and “guest worker” labor.

So when Silicon Valley moguls, and the politicians they hire, speak of a global economy in which “we” must learn to compete, they mean that corporations must be given the ability to enact legislation to freely move equipment, wealth and labor assets (a.k.a. people) from one continent to another, in order to optimize production costs and maximize profit across their global operations. The Silicon Valley promotional website states that we need to “attract the world’s best and the brightest workers”. Leaving aside the moral dilemma of poaching the human capital of poor countries, is indentured servitude to corporate billionaires the best instrument we can think of for attracting the truly best and brightest to our shores? How about an exclusive invitation to come to America as free men and women?

What does this have to do with health care? If you use health IT, work in health IT or are looking for work in health IT (perhaps a "proud" holder of an ONC health IT certificate), then you know exactly how this is pertinent to you....

Disclosure: I am an engineer by education. From the time my children were old enough to think about what they will be when they grow up, I made sure that engineering will not be something they would consider, and although all of them have exceptional math and science abilities, not one of them is pursuing a career in engineering or technology. I consider this a resounding success.