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Microsoft Comes to HIMSS

April 17, 2007
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When Microsoft talks, people usually listen. That was certainly the case when Steve Ballmer, Microsoft CEO, addressed a packed house for the inaugural keynote at HIMSS07 in New Orleans. Ballmer's speech came after the company's Azyxxi acquisition last year and on the heels of its purchase of medical search engine Medstory. In addition, just before the show, Microsoft announced the release of its Connected Health Framework (CHF) Architecture and Design Blueprint, a free download of code and instructions intended to help CIOs leverage Web services and a services-oriented architecture (SOA) model to integrate disparate applications. In an exclusive interview immediately following his speech, Ballmer sat down with Healthcare Informatics Editor-in-Chief Anthony Guerra and Editorial Director Charlene Marietti to learn more about the company's healthcare strategy.

How can Microsoft help providers and consumers aggregate healthcare-related content?

We're trying to do two important things. Number one, we're going to try to pull together people's information, because I still don't think there's going to be just one EMR. For the provider, that's essentially what Azyxxi does. It will talk to a variety of EMR systems. And, number two, regarding how does the consumer get to play, the consumer needs to do something similar to what the doctor needs to do. The doctor needs to pull from a bunch of EMRs and then look at this information in one way.

The consumer needs to pull a bunch of stuff from a variety of different sources, and then mix it together with content and other things on the Internet that are relevant to what they have pulled together. Because if you just pull together information, it may or may not be that valuable to the average consumer. So while Azyxxi is definitely a product that is targeted today at the provider, the feeds that it has, we also think, can translate well to the consumer side.

Why was this the right year to come to HIMSS?

We feel like we have a real strategy on the provider and institutional side, and we understand what we're trying to do on the consumer side. So we feel it made sense for us to say, "OK, we're very serious about health, not just providing doctors with a word processor, but also very interested in the business of health, and we're very committed to it," and it seemed like a good time to come out and speak on that topic.

Is it the trend of consumer-driven healthcare, with high-deductible plans and health savings accounts that prompted you to move more aggressively into the market?

Absolutely. When we talk about a consumer strategy for us, we have to start with the notion of empowerment for the consumer, empowerment based on the fact that there's so much technology that consumers expect to be empowered. There's so much data, there's so much more to sift through.

You don't care about productivity unless there's some valuable asset tied up in it. Well, my health is a valuable asset, and my money is a valuable asset. There are many healthcare decisions that we make that are life and death. There are many more decisions that have to do with wellness, fitness, etc. And unless there's this aspect of consumerism, we would not get these trends that make things valuable to the consumer audience.

Regarding the personal health record, how many are there going to be and who will own them: the consumer, the employer, the payer or the provider?

I don't think there's going to be only one. There may be one standard format, but the notion that there's really just one record, I think, is always in the future. And so the consumer will implicitly, if not explicitly, trust multiple people. The consumer does today and doesn't think about it. I obviously trust our (company) payer, but a few years ago I would have had no idea what our payer knows about my personal health, but I would trust them. I obviously think I would trust Microsoft to pay me. I trust my doctor as they have one of the most trusted brands of any profession. As these things become more electronic, this issue will become more vivid. I think the only place a patient will get a truly integrated view will be their own view of their own record — assembled from information which gets pulled from multiple sources. Just like my financial information today, if I want to see a unified view I have to pull from Fidelity, Wells Fargo, etc, etc.

Your Connecting for Health Framework features a SOA. I think we've seen that model more rapidly embraced in industries like financial services than healthcare. How do you predict adoption will proceed?

It's one of these things where if you don't get started, you don't make progress, so I think we have to get started to make progress. The technology industry's plumbing is now far enough advanced that this is a sane discussion to have. When you take a look at what's happened with XML Web service standards, we have security, we have messaging. We have enough of the infrastructure ready that you can intelligently do a reference architecture based upon SOA that makes some sense. So now is the time. Getting from here to there is not going to happen overnight, but we have to get out there and get going.

This is such a fragmented industry. It's amazing to me how fragmented this industry is. It should not have developed this way. In other industries, the lines of business processes have been turned over, but this one is so customized still that there's a lot of work to do.

In addition to the CHF, you've announced your acquisition of Medstory, Azyxxi last year, and you're also involved in NEPSI (the National Electronic Prescribing Safety Initiative), what is the strategy that ties those all together?

As far as the traditional Microsoft goes, we build client platforms, just think Windows and Office. We have mobile devices, Windows Mobile. We build server infrastructure. So we have collaboration. We have core programming and storage. We've got security management. We have done these things forever, and there is nothing very healthcare specific.

But with this base, we've built partnerships which are very important to us. So we've been working with Eclipsys and Allscripts. Because we have lived at the (infrastructure) level, CHF makes sense, the e-prescribing initiative makes sense, just at this level. Even if we have no vertical content, these things all make sense. And, what we're trying to do here, is to enable the industry basically to use our infrastructure, that's out strategy, to enable people to use this infrastructure. If a doctor wants to write notes in Word, we want that to flow seamlessly through the workflow in anybody's EMR package, that should all work.

Now, you add into that our institutional and consumer health strategy. So, in some senses, we are now an application provider to this platform, just the way that a number of these other guys are. The way Epic would be or Eclipsys would be, we're a user of the platform and that's where Azyxxi comes in. That's where the Medstory acquisition comes in and some other stuff we have coming up. And, I think, what will happen is some of the things that we do with our platform to enable the entire industry will be interesting and that will be one set of stories. And then how we support that and how we drive our specific application involvement both on the institutional side and on the consumer side will be important (and another set of stories).

When you talk about going beyond providing enabling infrastructure, do you move from working with partners to moving into competition with them?

Yes, and that happens all the time. With SAP, we are a great partner and now that we've got our Dynamics line we are a great competitor, and it can work. Most of the guys who are big players in the market today, we are not competitive with. They may not love the fact that we're doing Azyxxi because they say "OK, just play down here (in terms of infrastructure) and stay away from here (healthcare-specific applications)."

In a good old IT world where we just used IT words, CHF is all about the infrastructure plumbing, Azyxxi is a business intelligence package, essentially it can tie together a variety of different applications and pull together data. So workflow gets pulled together through the CHF and that is the connected systems aspect, and then Azyxxi is for supporting informed decisions, business intelligence, etc.

What is the most challenging part of enacting your strategy in healthcare?

The good news is I know the industry has room to grow. It still feels like, if this were a baseball game, we'd say we were in the second inning. We feel like a kid in a candy store because we think we can make such a huge difference.

On the flip side, you ask what is difficult, and what is difficult is you have an industry that is not just in the software sense fragmented, but you have an industry that is very fragmented in its delivery model and the fact that is fragmented means — maybe with the exception of the U.S. Government as a payer — it's hard to know how you get standardization and critical mass. You have little hospitals and big hospitals, but you've got a lot of big hospitals. It's not like the car industry where you have five or six big companies, and if you get those companies on board you can get a snowball effect. The hospitals have a lot of independence and then the clinics inside of those hospitals have a lot of independence, and then small docs are separate. The payers have some influence but not total influence. There is not a more fragmented industry structure anywhere which means getting the critical mass is tougher.

Now, in financial services, I'd say if we can get if we can get Bank of American signed up and Wells Fargo, and JPMorgan Chase and Merrill Lynch we're close. You can't list five guys and be close on anything in healthcare. Five guys and you're lucky if you're close in the city of Seattle.

What about working with the five largest vendors and then moving out into the industry through their clients?

The biggest vendors in this industry are still small, relative to the size of the industry. This is the single biggest vertical in the world and the biggest vendors are all roughly around $1 billion, it's shocking. And these aren't cheap systems, it's just they don't scratch a very high percentage of the total seats in the industry. It's not that they aren't fine companies, it's the industry structure of healthcare, and actually I think consumerization will be an important part of affecting not the delivery structure — because I think that stays fragmented — but the IT structure. The notion that things are going to get more standardized and more regular and more interoperable, that will happen more because of the consumerization of health and the push by government on the consumerization of health than it might happen due to anything going on on the provider side. And it will be good in terms of improving the technology available on the provider side.

And you believe Microsoft can help solve some of the fragmentation in healthcare?

If you assume fragmentation is the rule, and I think that is a fair thing to say, then what you want to do is deal with that fragmentation, you don't want to come in and just say, 'Hey, I've got the 58th approach you've been pitched to invest in, of which you've probably invested in 25 because (you've been promised) a single overarching work standard.' We're saying, let's take what you have and leverage it and get value out of the data that you have. And let's go do that and get you as much value as we can. And if you want to standardize that stuff, that's a great thing, we actually recommend that, but it's not required.

How committed are you to the healthcare space and why do you think you can make such an impact?

Somebody's going to make an impact. In a sense, more than any other company, it relates to our skills. The company that makes a big impact isn't going to be one that only focuses in on providers. The company that makes a big impact is going to be one with a consumer and provider focus.

(Think about) how did we succeed with Windows and Office? We didn't just have an institutional focus or corporate focus. We had a corporate focus and a consumer focus. In driving information technology initiatives, the best way to drive them is institution out, consumer in, and unless you are working both sides of that fence, I think it's very hard to drive change in IT. That's true in any industry, not just healthcare. You ask who might have a shot at doing that? Well, I'll put our hands up. We'll see if any of the current institutional IT providers — the GEs, the Cerners, etc. — choose to play on that side. They might and they might not. Everybody wants to talk about the magic emerging Google, and of course they don't have anything yet, so who knows what their play might look like, but it's probably consumer primarily. That would be a good bet based on where we are.

I think we have really unique assets and I think this is fundamentally a human productivity problem, and where we have made our reputation is giving people the tools to be more productive.

I was told that in 2000, you had six employees focused on healthcare and now you have 600. Where will you be seven years from now?

We expect to see good growth, and the more success we have, the more growth we'll see. It all starts with getting some products and services into the market. The platform itself will not fuel enormous growth in new people. What's going to fuel it on the sales, marketing and R&D side is what's going on up here (application development). What will determine if we have explosive growth or not is us as an application service provider for the consumer and for the institutions — the providers and payers.


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