One-on-one With NYU Langone Medical Center CIO Paul Conocenti, Part IV

GUERRA: What if it’s determined, five years from now, that we’ve reduced medical errors by 20 percent, but somebody can also prove that we’ve reduced hospital revenues and physician income by 20 percent? Would that formula be sustainable?

CONOCENTI: I think that there are going to be winners and losers, and, at the aggregate, healthcare will be improved and cost will go down, but when you look at all of the pieces of the pie, some are going to be making more and some are going to be making less, and that cuts to the core of transforming the compensation model associated with healthcare. The transformation of that model has to happen because you can’t transform the industry without adjusting and retooling the compensation model associated with it. And so, in fact, the compensation model is probably one of the biggest disablers of the HITECH plan, and this pay for performance is nice, but it’s just one small thing that has to happen. The industry is still struggling with getting paid for online consults. It just has to change. Who’s going to bear the burden of this change is going to be a very interesting dialogue, but unless we look at all the players and all of the components of healthcare and adjust that, then you will have lots of articles, you’ll have tons of studies that say that this stimulus bill and this whole transformation did not meet its objectives. But I think if you look at the aggregate and you adjust the compensation, I think it’ll be better for everyone. The fact is, that’s where it’s going, healthcare is too expensive, and it’s too expensive because we’re dealing with paper, we’re dealing with inefficiencies in the system; we’re dealing with inequalities around the compensation, and the payment structures of healthcare.

Look at research, research loses money all the time because it lives off of the back of the hospital. But without good research, who’s going to come to a medical center which is dealing with tertiary and quaternary care; and the primary care is out in the community? You’re going come to a place like NYU because it’s got great research. You want to talk about personalized medicine, how does that interact with this? Who’s paying for that? There’s no compensation for research. You would want to be able to take your data, and have it living so that the greatest research that happens can impact your life, and there’s a cost to be able to do that, and that could protect a lot of lives, that could really save a lot of money.

We’ve got grants and we’ve got a lot of these other parts of the stimulation and the CTSA, which is a very good initiative. Payers – what’s their role in this? You’ve got the government putting their finger in it but what’s happening to the Oxfords and the Aetnas and all these guys? Are they just hoping it all happens and it’s going to reduce all of their costs because they’re going be living off of the back of the government? They’re the ones making lots of money; what about the pharmacy industry? So we’ve got to look at the whole thing, but you’ve got to start somewhere.

So right now I think that the benefit of the compensation with HITECH, and the $44,000 being offered, has really stimulated things.

GUERRA: Do you have any advice for colleagues who may not have the same level of resources at your disposal?

CONOCENTI: For the smaller organizations, if they even have a CIO and they’re struggling with cost constraints, I think that there is a lot of research around the benefits of an information technology system. I think they have to start with where is the most pain? So, if they’re a community hospital and they’re still on paper, from an ordering point of view, I think they can make a very compelling case that they need to be able to get a CPOE system. There are monies available, hospitals get some of the stimulus as well, and they should work with whoever it is in the organization that handles business planning and the CFO-type person who understands the reimbursement model, because the reimbursement model is driving even hospitals to get electronic. If they’re on paper, actually, in many ways, it’s easier for them than if they’ve got a lot of hybrid stuff.

I would also suggest they look at some ASP models, because they can’t really do it all themselves, and I would also say that they should partner up with some of the bigger guys.

GUERRA: Partner with vendors or hospitals?

CONOCENTI: Hospitals. So, for every region there’s always a couple of big guys out there. If you have an affiliation agreement, which most community hospitals have with someone, you should be asking that larger partner. ‘How much would it cost if you extended your IT system to us? We’ll pay for what we get, pay for it by the glass, I can’t buy the whole bottle, but I can pay by the glass. Right now, I can afford a glass, and you’ve already worked out all of the best practices and all the alerts and all the workflows because you’ve been doing it for years, so I don’t really need to reinvent that. Can we work something out?’

Some places will say, ‘Get out of here, I’ve got my own worries,’ but others might actually think, ‘Well, that’s not a bad idea,’ and so I would try a number of those things, but I think doing nothing is not an option. And if the CEO and/or the president and/or the COO doesn’t get it at this stage of the game, with all of the stuff going on, unfortunately my advice would be to find another place to go.