In a recent note, I described how it was possible for a hospital CIO to get fired after choosing Epic for the hospital EHR (see: Who Says a Hospital CIO Can't Get Fired for Picking the Epic EHR?). Here's item number one from my list:
First and foremost, and as emphasized above, one path is not preparing the hospital for the numbing cost of the Epic EHR, exacerbated by the abrupt decline in physician and nurse efficiency and productivity when working with the system (see: The Cost of Deploying an Epic EMR and the "Oreo Cookie" Analogy). In this regard, Epic is probably not much different than its competitors in the EHR market. Unknown at this time is to what extent this drop in efficiency is recoverable as nurses and physicians become more familiar with the system.
A long and detailed article in Healthcare IT News explains how the CIO at Maine Medical Center, Dr. Barry Blumenfeld, was made redundant (see: Go-live gone wrong). Below is an excerpt from the article but it's only a small portion of it so read the whole thing if you are so inclined.
Maine Med’s go-live last December of its estimated $160 million Epic EHR system seemed at first to go off without a hitch. But four months later, the hospital network’s CIO, Barry Blumenfeld, MD, ...was out of a job, and, in an April 24 letter to employees, Maine Medical Center President and CEO Richard W. Petersen announced a hiring freeze, a travel freeze – and a delay in the further rollout of the EHR throughout the rest of MaineHealth.“This is being done to concentrate and focus our information systems resources to finding solutions to our revenue capture issues,” Petersen wrote. The letter, obtained by Healthcare IT News, cited a $13.4 million operating loss the hospital sustained over six months of its fiscal year. Petersen cited as contributing to the loss a decline in patient volumes, the increasing number of patients who can’t afford to pay for their care – and the launch of the electronic health record system.
....The [Winsten Salem] Journal [noted with regard to its EHR deployment] that Wake Forest Baptist cited $8 million in “other Epic-related implementation expense” that it listed among “business-cycle disruptions (that) have had a greater-than-anticipated impact on volumes and productivity.” Also listed was $26.6 million in lost margin “due to interim volume disruptions during initial go-live and post go-live optimization.” Wake Forest Baptist attributes some of its operating loss in its current fiscal year to projected revenue that has been delayed related to problems rolling out Epic, particularly with billing, procedure coding and collections.
Detroit-based Henry Ford Health System, meanwhile, reported total revenues of $4.46 billion in 2012, an increase of $490 million from the $3.97 billion total revenues in 2011. Overall, however, Henry Ford reported $53.1 million net income for 2012, as compared to $62.9 million in 2011 – a decrease of 15 percent.“The net income decrease is related to two factors,” Henry Ford’s Chief Financial Officer James Connelly noted in an April 25 news release. “The first is an increase in uncompensated care in 2012 for the health system. Second, Henry Ford is making a significant investment in state-of-the-art information technology in our clinical, business and insurance operations, which positions us well for healthcare reform.”
“I believe that the single source, proprietary, milk-’em-dry [EHR] model is going to hit a wall,” [Edmund Billings, MD] told Healthcare IT News. “Particularly when the organizations are not going to be able to go fee-for-service to cover it, or they don’t have the endowment.” Kaveh Safavi, MD...who leads the health industry business for North America for Accenture, a global consulting and outsourcing firm, says Accenture tends to serve very complex, very large systems. Lately, Accenture has worked mostly on Epic and Cerner implementations, but its consultants have also worked on deploying Allscripts and Meditech.“The general rule of thumb,” he says, “is whatever you spend on your technology, you’re going to spend twice as much on the task of implementation. What is often described as a ‘glitch,” he said, “could be a glitch at the level of technology implementation, but it’s often at the level of the processes themselves. So translating business rules into technology rules … it’s not really a technology problem, but the technology has to catch it."
Here are my own takeaway points from this excellent article:
- As might be expected, no one in any official capacity at any of the hospitals referenced would speak on the record about issues directly relating to their Epic deployment (see: Physician & Nurse Involvement in EHR Design; Patient Safety and EHR Gag Clauses). One anonymous nurse from Maine Medical was quoted as saying a major problem with Epic was that charge capture for activities such as starting an IV had to be immediately logged on the computer. She said that she had not been trained for this and that it was a major distraction.
- I am very pleased that web publications like Healthcare IT News are willing to step up to plate and make available information about EHR deployments that would otherwise not see the light of day because of the gag clauses in Epic contracts.
- Charge capture and revenue cycle management! All executive officers need to keep these processes firmly in mind when deploying an EHR. Here's another point that is often missed in EHR go-lives. All hospitals with legacy billing systems in place (which is to say most hospitals) have myriad instances of installed customized programs. Neither personnel in the hospital central IT group, nor the CFO, nor the CIO may have a complete understanding of these programs, which are often poorly documented. Many months may be required to iron the kinks out of a new billing system and payers may not accept late charges.
- In addition to problems with charge capture after an Epic go-live, hospitals will also take a huge nurse and physician productivity hit because they are not familiar with the screens and the user-interface may be poorly designed. The result is the double whammy after an Epic go-live of a 15-20% diminution in revenue plus the additional burden of the cost of paying for the EHR license, installation, and continuing vendor support.
- This story about Maine Medical is only the beginning of a host of bad-news financial reports from some of the largest and best hospitals in the U.S. It's a cautionary tale for health systems such as the University of Michigan, Henry Ford Health System, and Partners in Boston.