# Presentation: 703546

## Testimony for the Workgroup on Computer-based Patient Records

- NATIONAL COMMITTEE ON VITAL AND HEALTH STATISTICSDecember 9, 1998Presented by: Blackford Middleton, MD, MPH, MScVice President for Clinical InformaticsMedicaLogic, Inc.

## Introduction

- Blackford Middleton, MD, MPH, MSc
- VP for Clinical Informatics, MedicaLogic
- Current Affiliations
- Clinical Assistant Professor of Medical Informatics and Outcomes Research, Oregon Health Sciences University, 1996-
- Attending Physician, Department of Medicine Faculty Practice, Providence Health System, St. Vincents Hospital
- Chair-person Elect, Computer-based Patient Record Institute (CPRI)
- Thank you for inviting me to testify before you.

## Materials Submitted 

- Copy of presentation slides
- Supporting documentation
- Informatics standards used in MedicaLogic LogicianTM EMR
- Logician TM product architecture
- Case Report: Cost and Quality Benefits of an Electronic Medical Record in a Family Practice Setting

## MedicaLogic Background

- First generation EMR 1983 - ClinicaLogic
- MedicaLogic incorporated 1985
- Second generation EMR 1995 - Logician
- Open architecture, standards-based EMR
- Oracle RDBMS, TCP-IP, 2- or 3-tier architecture, browser-based or C++ desktop
- Informatics Standards:
- Messaging HL-7 (hundreds of system interfaces)
- Content: ICD-9-CM, CPT4, SNOMED, ASTM, LOINC, NDC-GPI
- Inc. 500 in 1995 (#262), 1996 (#181), 1997 (#84), 1998 (#131) - *fast growth due to standards-based application*

## Use of Informatics Terminology Standards

## Desiderata

- Support/enhance the doctor-patient relationship
- Improve healthcare delivery efficiency, quality, and service at appropriate cost
- Empower clinicians with state of the art tools to support clinical information access and clinical decision making
- Exchange a longitudinal complex record between two disparate EMRs when a patient changes doctors or plans
- Secure access to healthcare information remotely when disease occurs away from home

## Opportunities for Annual Costs Savings with HIT(Punk & Ziegel)

## Macro-economic Benefit Cost Analysis for HIT

- US Healthcare - $1.0T, ~15% of GDP
- Potential Savings Est. - $250B
- Even if HIT spending increased to 8% of Healthcare operating budgets - only $80B
- Therefore...
- Benefit/Cost ratio: $250B/$80B = 3.13
***Or... for every $1 spent in HIT expect $3.13 savings***...

## Microeconomic Analysis: Capital Region Healthcare - Concord, NH

- Family Care of Concord - 12 providers and staff  -> 1200 visits/month
- 42% Managed Care (seven companies), 35% commercial insurance, 15% Medicare, 5% self pay, 3% Medicaid
- $87,000 for hardware, software, and implementation of EMR with I/Fs
- Annual support costs, which include software maintenance fees, upgrades, information technology support staff, and depreciation, are $37,000
- Total Year 1 costs = $124,000

## Capital Region Healthcare - Benefits per Annum

- Transcription costs of $53,000 eliminated through use of physician data entry tools - net savings $43,780
- Chart Pulls eliminated - $24,500
- Prescription writing - $71,400
- Coding research and assignment - $5,950
- Lab filing - $5,525
- Referral paperwork - $7,140
- Total Benefits $158,295

## Capital Region Healthcare - Benefits per Annum

- Qualitative Reporting - Detect true rate of preventive care services (discovered practice eligible for quality bonus)
- Drug recalls - Patient letters sent within one day of recall alerts
- Hospital inpatients - EMR available on hospital wards
- Patient Satisfaction - Group satisfaction rates 89.9%

## Capital Region Healthcare - Benefits and Costs Summary

- Operational Costs		Annual
- Total Benefits		$158,295
- Total Expense		$37,000
- Net Benefits		$121,295
- Benefit/Cost Year 1	1.27
- Benefit/Cost Ongoing	4.27

## Q1: How do you interpret the Congressional instruction? 

- Goal: Administrative Simplification
- To improve the efficiency & effectiveness of the health care system by standardizing the electronic data interchange of certain administrative and financial transactions;
- Establish penalties for non-compliance with the legislation; and,
- To protect the security & privacy of health care information by setting standards.
- Hopefully, through standardization of electronic data interchange, the system will experience a net savings potential over six years of $42 billion as estimated in the 1993 WEDI Report.

## HIPAA mandate to HHS 

- Adopt national standards necessary for efficient electronic administrative and financial health care transactions.
- All health plans (including government health plans), all clearinghouses, and those providers who choose to conduct their transactions electronically are _REQUIRED_ to implement the standards.
- Provide privacy legislation.
- Provide recommendations for an electronic medical record.

## HIPAA mandate to HHS

- Provide standards for nine EDI administrative transactions (claims, encounters, enrollment, etc., including code sets.)
- Provide standards for COB (Coordination of Benefits)
- Provide standards for unique identifiers (including allowed uses) for individuals, employers, health plans, & health care providers.
- Provide standards for security, confidentiality, and electronic signatures.

## Q2: What factors or issues are preventing or delaying the development and widespread implementation of uniform standards for patient medical record information and its electronic transmission? 

- Scope
- It’s a BIG and COMPLICATED problem
- Numerous stakeholders
- Unaligned incentives
- Uncoordinated healthcare standards setting efforts
- Poorly or  un-coordinated implementation of vendor, or home-grown, systems
- Uncoordinated healthcare professional society data standardization efforts

## Q3: Is the private sector able to address these problems? What is the role of government for assisting the private sector in the guidance, development, coordination, and implementation of standards for patient medical record data and their electronic transmission? How might the government help to improve the standards processes? 

- Why can’t vendors (private sector) solve these problems?
- Why can’t providers solve these problems?
- Why the government should assume an expanded leadership role in this field?

## Why can’t vendors (private sector) solve these problems?

- Healthcare standards are DIFFERENT in character and scope
- tangled web of interrelated standard setting efforts makes broad based progress slow
- One-off solutions, or worse – site-specific solutions
- Vendors are rewarded for successful ‘enterprise’ implementations with little regard for inter-enterprise data sharing
- Possible for ‘hard’ standards such as ISO stack protocols, HL-7
- Difficult or impossible for ‘soft’ standards such as terminology and reference model

## Why can’t providers solve these problems?

- They are not SDOs, or software developers - we have yet to see successful commercialization of home grown system.
- With rare exception provider organizations have little concern for data-sharing issues beyond their enterprise
- Often limited scope or relevance to their business mission (few provider organizations cover ALL of healthcare delivery needs)

## Why the government should assume an expanded leadership role in this field? 

- BIG problem
- Healthcare informatics standards as a public good
- Many stakeholders, unaligned incentives, potentially forever at odds
- Critical to the health and well being of the American People, and the American economy
- Leadership void identified in the 1993 GAO report remains unfilled

## Q 4a: Which standards related to patient medical record information and its electronic transmission would: Add the most value for improving the quality and efficiency of health care for the nation? Why? 

- First -
- Simplify the goals to the bare minimum with respect to identifiers, terminology, data sets and models, interoperability, connectivity, security and confidentiality
- Second -
- Establish a framework for comprehensive health terminology systems, and a trusted agency to act as responsible party for coordinating the essential health information technology standards development process
- (Chute C, Cohn S, Campbell J et al. JAMIA 1998;5:503-510)

## Critical Informatics Standards and Issues

- 1.	Education and training
- Public, Providers, Payers, Employers, Feds
- 2.	Documentation requirements for paper and electronic records
- Minimal documentation requirements
- By specialty or domain
- By location of care
- 3.	Minimal data sets
- Essential terminology standards for clinical findings pertinent to #2, and to clinical decision support, and outcomes assessment
- Support uniform and consistent quality measures
- CONQUEST, NCQA/HEDIS, JCAHO/Oryx

## Critical Informatics Standards and Issues

- 4.	Interoperability standards for EMRs
- Identifiers: person, provider, place, plan, EIN
- Enterprises already implementing MPIs
- Facilitates integration and exchange of clinical information
- Reference terminology and information model
- Support consistency of usage
- Support interoperability and clinical information exchange and machine interpretation
- Messaging - HL-7, X12, NCPDP
- NHII, secure national healthcare networks
- 5.	 NEW - Mandated drug interaction assessment at the point of care
- 6.	NEW - Mandated quality standards

## Q 4b: Which standards related to patient medical record information and its electronic transmission would: Be most important to the business or goals of your organization? Why? 

- Documentation requirements  (money)
- Interoperability standards - (implementation)
- Outcomes reporting -‘report cards’ (fear)
- Clinical Decision support - (quality)

## Q 4c: What is the business case for more rapid standards development and implementation? 

- From whose perspective?
- FFS Provider - wait and see
- At Risk Provider Organization - Now!
- Health Plan (without owned providers) - Depends on local market
- Employer - ditto
- Consumer - about to explode
- Cost - Speed adoption of clinical information management technology to  experience process improvements and savings
- Case study demonstrates savings utilizing fairly rudimentary standards
- Quality – secondarily improve clinical decision making, and resultant outcomes

## From JAMIA

- Epidemiologist William Farr, 1848:
- “nomenclature is of as much importance... in this inquiry... as weights and measures in the physical sciences, and should be settled without delay”
- Chute, et al:
- “Failure to achieve common goals and standards will preclude efficient comparison of practice patterns and outcomes, and we will therefore have great difficulty identifying best practices and sharing among institutions or nations. Nor would be be able to consistently implement identified best practices across institutions as health care deliverers begin to develop decision support resources...

## Q5: Do you agree with our emphasis the four focus areas listed above? Explain.

- Four focus areas
- standards for administrative clinical messages
- standards for patient clinical information (data element definitions, data models, and code sets).
- enhance the coordination and maintenance of both administrative and clinically-specific code sets (data-dictionary and data-set registry)
- address the business case issues regarding the implementation of uniform data standards for patient medical record information.
- Yes - with additional focus on public-private mechanisms for production, support, and maintenance of informatics standards