NYC Hospitals Face Massive Problems With Epic Install

Posted on August 24, 2015 I Written By

Anne Zieger is veteran healthcare editor and analyst with 25 years of industry experience. Zieger formerly served as editor-in-chief of FierceHealthcare.com and her commentaries have appeared in dozens of international business publications, including Forbes, Business Week and Information Week. She has also contributed content to hundreds of healthcare and health IT organizations, including several Fortune 500 companies. She can be reached at @ziegerhealth or www.ziegerhealthcare.com.

A municipal hospital system’s Epic EMR install has gone dramatically south over the past two years, with four top officials being forced out and a budget which has more than doubled.

In early 2013, New York City-based Health and Hospitals Corp. announced that it had signed a $302 million EMR contract with Epic. The system said that it planned to implement the Epic EMR at 11 HHC hospitals, four long term care facilities, six diagnostic treatment centers and more than 70 community-based clinics.

The 15-year contract, which was set to be covered by federal funding, was supposed to cover everything from soup to nuts, including software and database licenses, professional services, testing and technical training, software maintenance, and database support and upgrades.

Fast forward to the present, and the project has plunged into crisis. The budget has expanded to $764 million, and HHC’s CTO, CIO, the CIO’s interim deputy and the project’s head of training have been given the axe amidst charges of improper billing. Seven consultants — earning between $150 and $185 an hour — have also been kicked off of the payroll.

With HHC missing so many top leaders, the system has brought in a consulting firm to stabilize the Epic effort. Washington, DC-based Clinovations, which brought in an interim CMIO, CIO and other top managers to HHC, now has a $4 million, 15-month contract to provide project management.

The Epic launch date for the first two hospitals in the network was originally set for November 2014 but has been moved up to April 2016, according to the New York PostHHC leaders say that the full Epic launch should take place in 2018 if all now goes as planned. The final price tag for the system could end up being as high as $1.4 billion, the newspaper reports.

So how did the massive Epic install effort go astray? According to an audit by the city’s Technology Development Corp., the project has been horribly mismanaged. “At one point, there were 14 project managers — but there was no leadership,” the audit report said.

The HHC consultants didn’t help much either, according to an employee who spoke to the Post. The employee said that the consultants racked up travel, hotels and other expenses to train their own employees before they began training HHC staff.

HHC is now telling the public that things will be much better going forward. Spokeswoman Ana Marengo said that the chain has adopted a new oversight and governance structure that will prevent the implementation from falling apart again.”We terminated consultants, appointed new leadership, and adopted new timekeeping tools that will help strengthen the management of this project,” Marengo told the newspaper.

What I’d like to know is just what items in the budget expanded so much that a $300-odd million all-in contract turned into a $1B+ debacle. While nobody in the Post articles has suggested that Epic is at fault in any of this, it seems to me that it’s worth investigating whether the vendor managed to jack up its fees beyond the scope of the initial agreement. For example, if HHC was forced to pay for more Epic support than it had originally expected it wouldn’t come cheap. Then again, maybe the extra costs mostly come from paying for people with Epic experience. Epic has driven up the price of these people by not opening up the Epic certification opportunities.

On the surface, though, this appears to be a high-profile example of a very challenging IT project that went bad in a hurry. And the fact that city politics are part of the mix can’t have been helpful. What happened to HHC could conceivably happen to private health systems, but the massive budget overrun and billing questions have government stamped all over them. Regardless, for New York City patients’ sake I hope HHC gets the implementation right from here on in.