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The Unsustainable Financial Realities of Hospitals

Posted on September 3, 2014 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 15 blogs containing almost 6000 articles with John having written over 3000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 13 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit.

There’s a great blog post up on the Medsphere blog which talks about the challenging financial realities that hospitals are facing today. I especially like this summary list of the unsustainable healthcare business based on a Moody’s analysis of hospitals:

  1. Private insurers did not increase payments to hospitals.
  2. Medicare reduced payments due to federal budget cuts.
  3. Demand for inpatient services declined as outpatient care options rose.
  4. Retail outpatient options now compete with hospital clinics.
  5. Patients with higher copays and deductibles chose not to seek care.
  6. Hospitals are buying up physician practices.
  7. The costs of electronic medical record systems are impacting the bottom line.

As we talk about why healthcare in the US costs so much money, we always talk about programs that will lower the costs of the healthcare we provide. I often point out that while we love to talk about lowering the costs of healthcare, from a hospital perspective that translates to lowering the revenue they generate while keeping their costs the same. This is the real challenge we face in trying to lower the costs of healthcare. There are really large organizations that stand to lose if we lower the cost of healthcare.

The shift to Accountable Care Organizations and Value Based Reimbusement is a step towards dealing with the issue. If done right, these programs allow a hospital organization to get paid a similar amount while lowering the number of patients they see. The concept is good, but when you get into the details it’s much more complicated with a lot of odd incentives. Plus, I think it’s likely not nearly enough to save many of these hospitals that are already struggling. These programs are new and often just lead to the rich hospitals getting richer.

Unfortunately, as the list above shows, the EHR has been a cost pressure as opposed to a cost saver. Long term, the EHR has the potential to really lower costs, but in the interim many hospitals are suffering under the costs associated with EHR.

It’s not a pretty financial picture for most hospitals. What do you see on the horizon that could change this outlook?

CMS Issues Final Rule on EHR Certification Flexibility, MU Stage 2 Extension, and MU Stage 3 Timeline

Posted on August 29, 2014 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 15 blogs containing almost 6000 articles with John having written over 3000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 13 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit.

I can’t figure out what government process leads to final rules being regularly published at the end of the day on Friday. I know that Neil Versel from Meaningful Health IT News has hypothesized that they release it late on Friday when they want to bury the news. Maybe that’s the case, but the EHR certification flexibility doesn’t seem like something they’d want to bury. Regardless of the odd timing, CMS has just published the final rule that provides flexibility around EHR certification in the meaningful use program.

In their announcement, I’m not noticing any changes from what was in the proposed rule, but with some time we’ll know for sure if there’s any gotchas hidden in the final rule. No doubt many a meaningful use expert have just had their Labor Day weekend ruined by the announcement of this final rule.

Unfortunately, after the proposed rule was published most people loved the flexibility, but decided that it was too late for them to really benefit from the changes. I’ll be interested to see how many organizations will really benefit from these changes.

More importantly, the rule still includes the nebulous asterisk, “Only providers that could not fully implement 2014 Edition CEHRT for the EHR reporting period in 2014 due to delays in 2014 Edition CEHRT availability.” For EHR vendors that are already 2014 certified, this little asterisk feels like ONC is letting all the EHR vendors who didn’t perform well off the hook. It’s basically rewarding EHR vendors who can’t or have chosen not to keep up. Maybe that’s why the rule was published late on a Friday.

One could make the case that ONC was more worried about the doctors/hospitals whose EHR vendors failed to become 2014 certified, than the EHR vendors themselves. However, that part of the story is not likely to be told. Plus, it doesn’t take into account how a doctor/hospital whose EHR vendor is 2014 Certified will feel having to do the substantially harder MU stage 2 while their colleagues only have to do MU stage 1. (UPDATE: This EHR Certification Tool that CMS created seems to say that even if you’re on a 2014 Certified EHR and scheduled to do MU stage 2, that you can do Stage 1 or stage 2 objectives with 2014 CQMs. The chart linked at the bottom of this post says it as well. Seems like they’re being pretty open in their interpretation of “due to delays in 2014 Edition CEHRT availability”. Clear as mud?)

I’ve captured a chart showing the EHR Certification flexibility that this final rule provides:
EHR Certification Flexibility - 2014 Certified EHR

Plus, here’s the latest chart showing the meaningful use timelines:
Updated Meaningful Use Stage 3 Timeline

Other Resources and Responses:
CMS Official Press Release
CHIME’s Response
CMS’ EHR Certification Rule Tool
CMS HITECH 2014 CEHRT Flexibility Chart

We’ll keep adding other responses and commentary on the final rule as we find them.

The Path to Interoperability

Posted on August 28, 2014 I Written By

The following is a guest blog post by Dave Boerner, Solutions Consultant at Orion Health.

Since the inception of electronic medical records (EMR), interoperability has been a recurrent topic of discussion in our industry, as it is critical to the needs of quality care delivery. With all of the disparate technology systems that healthcare organizations use, it can be hard to assemble all of the information needed to understand a patient’s health profile and coordinate their care. It’s clear that we’re all working hard at achieving this goal, but with new systems, business models and technology developments, the perennial problem of interoperability is significantly heightened.  With the industry transition from fee-for-service to a value-oriented model, the lack of interoperability is a stumbling block for such initiatives as Patient Center Medical Home (PCMH) and Accountable Care Organization (ACO), which rely heavily on accurate, comprehensive data being readily accessible to disparate parties and systems.

In a PCMH, the team of providers that are collaborating need to share timely and accurate information in order to achieve the best care possible for their patient. Enhanced interoperability allows them access to real-time data that is consistently reliable, helping them make more informed clinical decisions. In the same vein, in an ACO, a patient’s different levels of care – from their primary care physician, to surgeon to pharmacist, all need to be bundled together to understand the cost of a treatment. A reliable method is needed to connect these networks and provide a comprehensive view of a patient’s interaction with the system. It’s clear that interoperability is essential in making value-based care a reality.

Of course, interoperability can take many forms and there are many possible paths to the desired outcome of distributed access to comprehensive and accurate patient information.  Standards efforts over the years have taken on the challenge of improving interoperability, and while achievements such as HL7, HIPAA and C-CDA have been fundamental to recent progress, standards alone fall far short of the goal.  After all, even with good intentions all around, standard-making is a fraught process, especially for vendors coming to the table with such a diversity of development cycles, foundational technologies and development priorities.  Not to mention the perverse incentives to limit interoperability and portability to retain market share.  So, despite the historic progress we have made and current initiatives such as the Office of the National Coordinator’s JASON task force, standards initiatives are likely to provide useful foundational support for interoperability, but individual organizations and larger systems will at least for the time being continue to require significant additional technology and effort dedicated to interoperability to meet their needs.

So what is a responsible health system to do? To achieve robust, real-time data exchange amongst its critical systems, organizations need something stronger than just standards. More and more healthcare executives are realizing that direct integration is the more successful approach to taking on their need for interoperability amongst systems. For simpler IT infrastructures, one to one integration of systems can work well. However, given the complexity of larger health systems and networks, the challenge of developing and managing an escalating number interfaces is untenable. This applies not only to instances of connecting systems within an organization, but also connecting systems and organizations throughout a state and region. For these more complex scenarios, utilizing an integration engine is the best practice. Rather than multiple point-to-point connections, which requires costly development, management and maintenance, the integration engine acts as a central hub, allowing all of the healthcare organization’s systems from clinical to claims to radiology to speak to each other in one universal language, no matter the vendor or the version of the technology.  Integration engines provide comprehensive support for an extensive range of communication protocols and message formats, and help interface analysts and hospital IT administrators reduce their workload while meeting complex technical challenges. Organizations can track and document patient interactions in real-time, and can proactively identify at-risk patients and deliver comprehensive intervention and ongoing care. This is the next level of care that organizations are working to achieve.

Interoperability allows for enhanced care coordination, which ultimately helps improve care quality and patient outcomes. At Orion Health, we understand that an open integration engine platform with an all access API is critical for success. Vendors, public health agencies and other health IT stakeholders are all out there fighting the good fight – working together to make complete interoperability among systems a reality. That said, past experience proves that it’s the users that will truly drive this change. Hospital and health system CIOs need to demand solutions that help enhance interoperability, and it will happen. Only with this sustained effort will complete coordination and collaboration across the continuum of care will become a reality.

About David Boerner
David Boerner works as a Solutions Consultant (pre-sales) for Orion Health where he provides technical consultation and specializes in the design and integration of EHR/HIE solutions involving Rhapsody Integration Engine.

Monday Health IT Potpurri

Posted on August 25, 2014 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 15 blogs containing almost 6000 articles with John having written over 3000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 13 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit.


This is a little bit self serving since Dan’s tweet includes a link to my article on EMR and EHR called, “If You Were an EHR, Which Would You Be?” Although, that post was 19 days ago, so it’s fantastic that Dan loved it enough to tweet it again. Plus, I’m sure that hospital readers will love that article. Side Note: Be sure to subscribe to all the other Healthcare Scene blogs here.


This shouldn’t be surprising. ACOs only require basics. Once they start requiring advanced capabilities, then they’ll built them.


Good advice from Cassie on LinkedIn. Good advice for anyone looking for a healthcare IT job is to get brushed up on LinkedIn. Not to mention uploading your health IT resume to Healthcare IT Central.

Other Forms of Overcharging in Hospitals

Posted on August 21, 2014 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 15 blogs containing almost 6000 articles with John having written over 3000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 13 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit.

In response to my previous post talking about hospital overcharging being overstated, I got an interesting reply from someone about other ways that “overcharging” is happening in hospitals.

Some are overcharging according EMR upgrade coding errors. How about $720 for ONE nitro tablet. Insurance company did not catch it either. About 9 months after an EPIC implementation so how many people/Insurance were overcharged and never knew?

In the meantime a gastric band operation in the UK is $7500 average. In the US it is between $15k and $30k depending on State. Is that not overcharging?

The first one is really interesting. You can see how after implementation of an EHR in a hospital it would be easy to charge extra for something (even accidentally). There are so many details to look at during an EHR implementation that it’s easy to see how something could be overcharged. Plus, it’s probably not a surprise to many that the insurance company doesn’t catch many overcharges.

The second point they made isn’t an over charge as we were describing it. Although, the price disparity question is a really important one and could be considered over charging in healthcare. Just a different form.

I’ve long said that I think the biggest key to fixing the healthcare pricing problem is to infuse more transparency into the system. Once transparency gets applied to pricing, it usually gets resolved pretty quickly. The second piece to transparency is shifting the cost responsibility to patients. In the past, patients didn’t care since they just paid their co-pay. However, this is quickly changing with more high deductible plans. This shift will require price transparency and then healthcare will be held accountable for what they’re charging for their services.

The Place of EHR in the Hospital IT Ecosystem

Posted on August 20, 2014 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 15 blogs containing almost 6000 articles with John having written over 3000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 13 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit.

I’ve been thinking a lot about EHR software and the part it plays in the hospital IT ecosystem. The $36 billion of EHR stimulus money has shined a big light on EHR software. No doubt the EHR incentive money has increased EHR adoption, but at what cost. I wonder if the EHR incentive money has caused many hospital IT teams to place undue emphasis on the EHR software.

The reality of a hospital IT ecosystem is that they usually have hundreds of healthcare IT systems in their organization. The EHR is just one of those systems. In fact, it might not even be the largest system. Their ERP system (usually Peoplesoft or SAP in large hospitals) could be larger. However, try being system #90 at a hospital. Do you think the IT people at a large hospital system are paying much attention to what’s happening to that system? Not only are they distracted chasing the EHR incentive money, but even without that incentive there are 89 other systems in front of it.

I’m reminded of this Healthcare CIO Mindmap that I posted previously. It’s a great image of the amazing complexity that a healthcare CIO is facing. Each of the branches on that mindmap represent one or more IT systems that have to be managed by an organization. That’s a complex and challenging task.

I guess my message here is that while the EHR is extremely important to an organization, don’t lose track of all the other healthcare IT systems you support. They won’t likely be noticed in the short term, but transgressing these smaller health IT systems will create organizational debt that will be hard to overcome in the future.

650 Posts, 500,000 Pageviews and Interesting Search Terms

Posted on August 15, 2014 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 15 blogs containing almost 6000 articles with John having written over 3000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 13 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit.

It’s an exciting time for Hospital EMR and EHR. We just passed 650 blog posts since we started this hospital IT focused blog back on May 19, 2011. Hard to believe that this blog is already 3 years old. 215 posts a year is a pretty amazing body of work. Plus, we’re approaching nearly half a million pageviews in that time and have 1,198 email subscribers for just this blog (not including the general Healthcare Scene email subscribers). A big thank you to everyone who reads us regularly.

I thought it would also be fun to take a look at the funny, interesting and insightful things that people are searching on Google (and other search engines) that lead them to the site:

epic certification – With 1,625 searches (and thousands of more searches for variations of this term), there is a lot of interesting in becoming Epic certified. Unfortunately, I think that means there are a lot of really unsatisfied people when they find out that there’s no easy way to get Epic certified. I hope this changes.

epic emr – Obviously we’ve written a lot of content about Epic. Although, overall interest in Epic is always high. So, it’s not surprising that many of our readers are interested in reading about Epic.

soarian & soarian emr – At least for this site, Soarian takes the second spot on searches. I think that’s attributed to some great articles that we’ve written on Soarian over the years.

meditech emr – I’m a little surprised that we still don’t have Cener on the list, but Epic, Soarian, and MEDITECH are attracting more searches to this site than Cerner. I guess that means we need to write more content about Cerner.

meditech vs epic – Looks like many people have been searching to see if they should move from MEDITECH to Epic. At least I assume this is the direction they’re considering. Has anyone heard of someone going from Epic to MEDITECH?

epic certification salary – You can understand the interest in these numbers. Although, I’m surprised that Google didn’t send them to this post on Healthcare IT Today about Epic Salaries and Bonuses. Although, that’s for people working at Epic. Maybe I should do a post on Epic certified consultants salaries.

hospital ehr vendors – This search is not surprising since our Hospital EHR vendor page is one of our most popular pages.

ipad security issues – A great topic of discussion that every hospital is dealing with. Apple has come a long way on this issue, but they could still do better. Although, I’m not convinced they’ll ever fully embrace enterprise IT.

closed loop medication administration – We haven’t dug into this topic as much, but we should. I’ll add it to my list of future topics.

An interesting look at what people are searching on Google (albeit biased by the content of this site). Thanks everyone for reading. I look forward to our next 650 blog posts.

Has Epic Fostered Any Real Healthcare Innovation?

Posted on August 13, 2014 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 15 blogs containing almost 6000 articles with John having written over 3000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 13 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit.

I saw the following tweet and was really struck by the question.

I think we could broaden the question even more and ask if any EHR vendor has really fostered healthcare innovation. I’m sorry to say that I can’t think of any real major innovation from any of the top hospital EHR companies. They all seem very incremental in their process and focused on replicating previous processes in the digital world.

Considering the balance sheets of these companies, that seems to have been a really smart business decision. However, I think it’s missing out on the real opportunity of what technology can do to help healthcare.

I’ve said before that I think that the current EHR crop was possibly the baseline that would be needed to really innovate healthcare. I hope that’s right. Although, I’m scared that these closed EHR systems are going to try and lock in the status quo as opposed to enabling the future healthcare innovation.

Of course, I’ll also round out this conversation with a mention of meaningful use. The past 3-5 years meaningful use has defined the development roadmap for EHR companies. Show me the last press release from an EHR company about some innovation they achieved. Unfortunately, I haven’t found any and that’s because all of the press releases have been about EHR certification and meaningful use. Meaningful use has sucked the innovation opportunity out of EHR software. We’ll see if that changes in a post-meaningful use era.

Pay at Epic – Did You Know There’s an Epic Reddit?

Posted on August 11, 2014 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 15 blogs containing almost 6000 articles with John having written over 3000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 13 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit.

HIStalk recently pointed to a reddit post about the Salary, Raise and bonus structure at Epic. It’s a fascinating look at what you get paid to work at Epic. I’ll be covering that topic in detail on our Healthcare IT Today career blog. However, did you know that there’s a subreddit on Epic?

In some ways, I think this says a lot about how far reddit has come, but it also says something about the size of Epic and the type of employee they attract. The younger reddit generation is their hiring strategy.

The subreddit is quite interesting. They talk about things like lunch at Epic (cheap and good), what it’s like to be a mom at Epic, and even topics like whether you can have a tattoo at Epic. Although, this one talking about the creepy customer announcements made me laugh:

The customer announcements over the loud speaker are so bizarre. It makes me feel like I’m in a1984-esque reality with an unsilenceable propaganda machine.
I doubt they intend it to be this way, but it is all I ever feel when it occurs.
Does anyone not find them creepy?

Looks like they even preach the Epic culture over the loud speaker. I do like that their celebrating each customer win since an Epic customer win is a really big deal. Although, the description makes me wish I could hear one of these announcements.

The Epic subreditt isn’t super active, but I’ll have to keep an eye on it to see any other interesting topics that are started. Maybe start a few of my own.

Cerner’s Siemens Acquisition and the Impact on the DoD Bid

Posted on August 7, 2014 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 15 blogs containing almost 6000 articles with John having written over 3000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 13 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit.

One topic I didn’t address in my post covering the $1.3 billion Siemen’s acquisition by Cerner is how this will impact the $11+ billion DoD bid. There’s a lot of discussion about what this acquisition will do. Let me pull out my crystal ball and give you my thoughts.

I personally think that this acquisition will have very little impact on which cluster of companies will win the DoD EHR contract. Some might say that Cerner gains some advantage by having some of the Siemens capabilities on board. Others could argue that Cerner will be distracted with the Siemens acquisition and so they wouldn’t be able to focus on such a large EHR contract. While both of things have some truth, I really don’t think they’ll factor into the DoD decision making.

It seems the consensus out there is people expect Epic to win the DoD contract. If that happens, the Siemens acquisition could become even more interesting for Cerner. It’s a very likely reality that whoever gets the DoD contract will lose some potential clients due to concerns about capacity. If Epic or Cerner get the DoD contract, then it’s possible that these capacity concerns will move them down a notch in people’s EHR selection process. This is a situation where Cerner will benefit from having connections to all of these Soarian customers. As I posted previously, it might be best for Epic not to win the DoD contract.

Are there other ways that Cerner’s acquisition of Siemens impacts the DoD EHR bid?