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Obama Stimulus Plan: The Audacity of IT

February 17, 2009
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I have read through my share of summaries, white papers and articles on the now passed stimulus plan. “Shock and awe” definitely come to mind when you look at the price tag. The question of stimulus aside, the provisions for Health IT are staggering. As I read the Health IT sections of the summary report on the House website, I was left with only one thought: the audacity of IT. In an industry that has a desperate obsession with hyperbole (any EMR implementation is Clinical Transformation), I don’t use audacity lightly. Specifically, 3 aspects of this legislation seem audacious:

1. Press all the buttons at once.

The amazing part of this legislation is shear multitude of hopes and dreams that have been funded. It almost seems as though the President listened to a confession of everything that is wrong with our industry or we wish we could do better and funded it. Everything from developing better IT medical education and extending medical informatics programs, to technology funding for the underserved; from EMR system certification and interoperability standards, to mandates to use systems and funding to help pay for it. The plan does have one overwhelming incentive in the form of Medicare/Medicaid payments, but beyond that (and including that), it is a bit of everything.

2. Pray for the “invisible hand”

There is a great presumption in this legislation that with the right incentives, we will do the “right thing” (ala Adam Smith). What is unclear is whether this conglomeration of incentives will lead to lasting change or will lead organizations to cut corners and take the path to the minimum necessary IT changes to qualify for the incentives. What the industry truly needs is sustainable investment that we can build on over years. The great hope is that many healthcare systems have already begun the pattern of sustainable investment, and that these incentives will help bring the reluctant to the table, and those at the table to focus on interoperability. The unfortunate reality is that big money often leads to big unintended consequences.

3. Trust us to figure out the details

As with any piece of legislation, the technical details are going to be left to the “experts.” This industry has a long history of success and failure on technical standards. I’m not sure that this legislation will make our efforts any better or worse, but there is always the hope that urgency will drive practicality. This legislation requires us to also figure out the details on the fronts of clinical collaboration and privacy protection. We must put forth some standard business practices that the industry accepts in order to meet the goals of this legislation. These questions cannot be simply answered by vendors and IT consultants looking to make a dime; however, by the same token those that produce the majority of the technology used in the industry shouldn’t be excluded.

These are interesting times for our industry. What is clear from this legislation is that those in Washington that developed and passed this legislation believe in the audacity of IT to be able to affect the future of the healthcare industry. They’ve placed their bet on the table. Now comes the fun part.



And there is a real zinger in it for the vendors...comes under the heading:

Be careful what you wish for....
Another vendor nightmare: Obama throws 19 bill at hospitals and docs to get with EMR systems — from a vendors perspective what could be wrong with that?
Try this:
The 'effectiveness' criteria are vague and won't even be preliminarily defined until 12/31/09. Then they are to be refined over the next two years. So if you buy a new system or new system component how do you know it will comply with whatever definition the feds come up with for 'effectiveness'? Consultants and HIMSS staff say — get a contract guarantee stating the vendor will meet any government effectiveness requirement.
If any vendor is crazy enough to sign such a contract his lawyers will die. Here's why.

Under Sarbanes Oxley if there are any contingencies in a contract, particularly significant ones, than the vendor cannot book any of the contract revenues until all those contingencies are addressed. Even if the system is up and running for a year and everybody is happy and all the bills are paid in cash! So if I am a public company such as Cerner, Eclipsys, etc, I will have a very long wait to book any revenues.
The guys who don't care are the private ones like Epic and Meditech. They can wait to make revenue accounting entries as long as they got the cash they need to pay the bills.

The legislation is audacious. And, in some ways, it is a gamble that we will apply the technology wisely and care will improve.

While one can take issue with pieces of the legislation, on the whole it is very responsive to the requests that the industry has been making of the federal government. We need financial incentives. We need standards. We need ways to help small practices implement EHRs. We need to train clinicians.

Congress and the President have largely answered those requests.

Now they can turn to us and say "We've met our end of the deal. Now you meet yours."

The feds seem very adept at writing legistation that, at first blush, seems to be the answer all prayers, but, upon closer examination, requires them to come back and clarify obtuse phrases and criteria in order to spur the desired action. The same thing happend with the Stark relaxations, everybody thought the hospitals would start showering practices with money, but a question about the effects on their not-for-profit status resulted in paralysis for months until the OIG (or whatever body it was) let them know they could turn over the cash without having to worry about winding up in a tax bracket.

Back in my vendor days we always felt that unless their was a government mandate or funding that e-prescribing and significant adoption of EMR technology would be a slow process. While I realize there is a lot to learn about how this will eventually play out - I do think this will clearly drive adoption much faster. Call me optimistic!