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June 21, 2010

Fill in the Blank
By Selena Chavis
For the Record
Vol. 22 No. 12 P. 20

With 2011 just around the corner, an ARRA readiness assessment can help hospitals identify what’s missing from the meaningful use equation.

Two million dollars would make any hospital executive’s head turn, and since many facilities may potentially receive much more than that through the American Recovery and Reinvestment Act (ARRA), industry experts suggest healthcare organizations take steps to assess their readiness to meet the upcoming meaningful use deadline.

Many hospitals across the nation must make significant investments to get up to speed with the criteria spelled out in the incentive package as it relates to EMR use. Specifically, the 23 stage-1 meaningful use criteria require electronically capturing key patient statistics, physician documentation and orders, and developing the ability to share data with other healthcare partners.

“A readiness assessment is looking at the underlying capability of an organization to reach the meaningful use deadline,” explains Paul Rosenbluth, principal consultant with Dell Services Healthcare, pointing out that hospitals must develop a road map for how they will meet the initial deadline for capturing the full incentive between 2011 and 2013.

Kevin Burchill, a director with Massachusetts-based Beacon Partners, emphasizes that hospitals must try to meet the deadline earlier rather than later to capitalize on the incentive payment. “We try to help them understand that in that ‘11 to ‘13 window, there is the greatest opportunity,” he says. “If you are ready to go, you can get four years of incentive payments and maximize the payout.”          

ARRA allocates more than $17 billion to implement EMRs and an additional $3 billion to improve the nationwide healthcare technology infrastructure—money that will likely be earmarked for the expansion of health information exchanges and regional health information organizations.

With that in mind, Dan Marino, president and CEO of Chicago-based Health Directions, suggests organizations assess their readiness with the broader picture of the meaningful use staging process as well. “Hospitals, at some point in time, need to be able to connect to other organizations in a community. They need to position themselves for physician connectivity,” he explains. “That’s where meaningful use is going.”

While the rules for stages 2 and 3 have not yet been published, many industry professionals believe they will continue to move in the direction of greater interoperability and data sharing between healthcare partners.

Changing Direction
As the saying goes, you need money to make money, and currently the greatest barrier to meeting the meaningful use deadline is available capital. According to the American Hospital Association, nearly 70% of hospitals cited cost as a barrier to achieving meaningful use. Maintenance fees also raise concerns. According to the report, EMR system cost estimates “range from $3 million for a small hospital to as much as $200 million for a very large hospital.”

“Hospitals have inherent weaknesses by the fact that no one has unlimited access to capital dollars,” Burchill says, noting that most hospitals have yearly capital strategies and budgets carefully laid out allocating hefty amounts to regular upkeep in the operating rooms and the radiology and emergency departments, to name a few. “IT is an organization that has had to compete for capital in the past. It has to be elevated from a support-service philosophy; the investment in IT has to go up.”

According to Burchill, a readiness assessment often starts with organization governance and structure—an examination of a facility’s current strategic plan and capital investment rollout. It also means taking an unbiased look at attitudes toward technology, beginning with the C-level suite and physician board and moving down to clinical staff.

“We want to know what’s important to an organization from a mission and values statement,” he says, adding that in the process of helping providers understand the potential for maximizing payout, it often means strategies and projects must be realigned. “What might an organization have to do to get up to speed sooner?”

Citing Massachusetts as an example, Burchill points out that before ARRA, state initiatives, backed by Blue Cross Blue Shield, had placed a 2012 deadline on full EMR use. “Organizations positioned themselves for 2012,” he says, adding that when ARRA was enacted, Massachusetts hospitals had their plans in place and those plans did not necessarily line up with a 2011 initial deadline. “The question then became could they speed up some initiatives or slow down others to meet the timeline.”

Rosenbluth encourages hospitals to be flexible and open to changing priorities that will place them at the forefront of readiness when it comes to meaningful use. He adds that it’s incumbent on organizations to have a proactive road map in place because expectations will continue to rise.

“The longer you wait, the steeper the incline for this staged model,” he explains. “If you wait until 2013 [to comply] with stage 1, then the very next year, you have to jump to stage 2.”

Burchill notes that when it comes to readiness assessments, some healthcare organizations will resist changing financial priorities, but thus far he has not found a single situation where it would be better for a hospital to wait to comply.

Initiating the Process
Tomball Regional Medical Center, a 357-bed hospital serving 250,000 residents in northwest Houston, hired Beacon Partners to gauge where it stood in terms of qualifying for federal funds. The project provided directional assessments of IT positioning and organizational capacity to achieve meaningful use criteria with an emphasis on identifying weaknesses in IT platforms and applications as well as quality reporting and privacy and security.

“We essentially identified gaps and helped them understand the work they needed to do,” Burchill says.

Tomball’s ARRA assessment was completed in four phases that encompassed a gap analysis of IT platforms, capital planning, operating budgets, operational considerations, medical staff structure, and staffing considerations. A detailed financial analysis of the ARRA incentive payments provided a baseline to review the organization’s current IT planning in a multiyear time frame that was paralleled against the current meaningful use definition.

“This format allowed us to review our planning in terms of operational support, adoption of technology, physician practice patterns, and even cash-flow implication,” says Tomball Chief Operating Officer and Chief Financial Officer Keith Barber. “It allowed us to pinpoint which systems help to achieve meaningful use and when our incentive payments could offset our capital investment plans.”

Burchill suggests that at a minimum, hospitals must understand the incentives’ potential benefits to their bottom line as well as how penalties will impact them if they fail to meet the deadline. It comes down to an initial financial analysis via an incentive calculation. “We work with the financial team to make sure we are all singing from the same sheet of music,” he says. “We have them look at Medicare reports and patient mix. Once the baseline number is determined, we do a four-year spread to spell out the payout.”

Hospitals also need to factor in the potential for penalties. Trend reports compiled by the American Hospital Association reveal that 55% of hospitals do not believe they will be able to demonstrate meaningful use by the 2015 deadline and will incur penalties.

Sally Akers, managing director of healthcare consulting with Dell Services, points out that hospitals nationwide are approaching meaningful use from a variety of levels, but most are still operating in some form of a hybrid record situation. “Large healthcare organizations that have been working with advanced deployment of EMRs are not feeling the panic,” she notes. “Smaller hospitals and ambulatory settings are a different story. They typically have a long path to travel.”

Akers says a number of smaller entities depend on vendors to get them from point A to point B and cautions that hospitals need to recognize where their vendor is taking them. Readiness assessments for hospitals should include an understanding of technology needs for compliance, process changes that will be required to comply, and broader needs to meeting health information exchange requirements expected down the road.

Burchill says the process typically begins with determining how to move a hospital from a hybrid record to one that’s completely electronic. “Most hospitals have an idea of the road map, and most are on some type of EMR journey,” he says, adding that most have deployed certain areas of the record to an electronic format, but the weaker areas tend to be those most necessary for meaningful use. “When you really get down to CPOE [computerized physician order entry] and physician notes, that seems to be the cascade. That’s the key.”

EMRs must be evaluated regarding their ability to aggregate and format data in a useable and transferable way, according to Marino, who adds that “when you are talking about readiness, that piece is one of the biggest issues hospitals have to overcome.”

Marino says assessments should consider whether an infrastructure is in place for a coordinated medical record. It becomes a question of what system will own the master patient index. “A lot of hospitals may have three, four, five points of registration, and the systems don’t talk to each other,” he says, adding that 20% of hospital orders will have to be electronic under meaningful use. “In order for that to be achieved by physicians, the hospital has to be able to support it.”

Akers points out that the assessment and resulting road map should allow for adequate time to put systems in place. She says a thorough analysis of finances, strategic plans, and workflow needs will take a minimum of four to six weeks and several months for large hospitals. Implementations can take months with training taking even longer.

“Healthcare organizations need to realize that it’s not just about implementing technology,” Akers notes. “There is a tremendous amount of process changes that go along with it.”

Looking Ahead
Experts agree that a readiness assessment is not just about IT or finance. Many players need to be part of the effort to determine what it will take to fill in the gaps to meet the stage 1 meaningful use deadline.

Burchill says it’s a “top-down and bottom-up” approach. “It takes an assessment that starts with the strategic planning and fiduciary governing body for quality and patient care—bottom up being the rank-and-file folks in IT and clinical who need to provide understanding of what it will take to make process changes occur on a day-to-day basis.”

Rosenbluth points to the potential benefits of bringing in a third party to help create a realistic plan, noting that most institutions simply don’t have the resources or the time to conduct a thorough analysis on their own. “Organizations should be engaged in self-assessments, but there is value in being challenged by a third party,” he says, suggesting that without an outside perspective, providers have a tendency to rate themselves higher than realistically warranted.

Looking ahead, Marino suggests healthcare organizations focus on technology that is scalable and will be able to meet health information exchange requirements in the coming years. Specifically, he says EMRs will need to evolve to the point that patient information can be extracted in a “meaningful” way by physicians.

“Primary care physicians have to be able to get information from that EMR that means something for them,” he explains. “You don’t need all the background information on a patient. Hospitals need to identify readiness for creating ways for physicians to go into portals and EMRs to extract just that information that is important to them. That’s where meaningful use is going.”

Rosenbluth agrees, noting that because the final rules are still in the works, “the most important thing for organizations to do right now is to be closely following meaningful use. It’s still very much a moving target.”

— Selena Chavis is a Florida-based freelance journalist whose writing appears regularly in various trade and consumer publications covering everything from corporate and managerial topics to healthcare and travel.