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24–713 PDF 2005

THE LAST FRONTIER: BRINGING THE IT

REVOLUTION TO HEALTHCARE

HEARING

BEFORE THE

COMMITTEE ON

GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED NINTH CONGRESS

FIRST SESSION

SEPTEMBER 29, 2005

Serial No. 109–90

Printed for the use of the Committee on Government Reform

(

Available via the World Wide Web: http://www.gpoaccess.gov/congress/index.html

http://www.house.gov/reform

(II)

COMMITTEE ON GOVERNMENT REFORM

TOM DAVIS, Virginia, Chairman

CHRISTOPHER SHAYS, Connecticut

DAN BURTON, Indiana

ILEANA ROS-LEHTINEN, Florida

JOHN M. MCHUGH, New York

JOHN L. MICA, Florida

GIL GUTKNECHT, Minnesota

MARK E. SOUDER, Indiana

STEVEN C. LATOURETTE, Ohio

TODD RUSSELL PLATTS, Pennsylvania

CHRIS CANNON, Utah

JOHN J. DUNCAN, JR., Tennessee

CANDICE S. MILLER, Michigan

MICHAEL R. TURNER, Ohio

DARRELL E. ISSA, California

GINNY BROWN-WAITE, Florida

JON C. PORTER, Nevada

KENNY MARCHANT, Texas

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

CHARLES W. DENT, Pennsylvania

VIRGINIA FOXX, North Carolina

JEAN SCHMIDT, Ohio

HENRY A. WAXMAN, California

TOM LANTOS, California

MAJOR R. OWENS, New York

EDOLPHUS TOWNS, New York

PAUL E. KANJORSKI, Pennsylvania

CAROLYN B. MALONEY, New York

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

DANNY K. DAVIS, Illinois

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

STEPHEN F. LYNCH, Massachusetts

CHRIS VAN HOLLEN, Maryland

LINDA T. SANCHEZ, California

C.A. DUTCH RUPPERSBERGER, Maryland

BRIAN HIGGINS, New York

ELEANOR HOLMES NORTON, District of

Columbia

———

BERNARD SANDERS, Vermont

(Independent)

MELISSA WOJCIAK, Staff Director

DAVID MARIN, Deputy Staff Director/Communications Director

ROB BORDEN, Parliamentarian

TERESA AUSTIN, Chief Clerk

PHIL BARNETT, Minority Chief of Staff/Chief Counsel

(III)

C O N T E N T S

Page

Hearing held on September 29, 2005 ..................................................................... 1

Statement of:

Brailer, David J., M.D., PH.D., National Coordinator for Health Information Technology, U.S. Department of Health and Human Services; and

Robert M. Kolodner, M.D., Chief Health Informatics Officer, Veterans

Health Administration ................................................................................. 22

Brailer, David J. ........................................................................................ 22

Kolodner, Robert M. .................................................................................. 38

Powner, David, Director, Information Technology Management Issues,

Government Accountability Office; Carol Diamond, M.D., managing director, Markle Foundation; Janet M. Marchibroda, chief executive officer, Ehealth Initiative and Foundation; Diane M. Carr, associate executive director, healthcare information systems, Queens Health Network;

and Larry Blue, vice president and general manager, Symbol Technologies .......................................................................................................... 64

Blue, Larry ................................................................................................. 114

Carr, Diane M. ........................................................................................... 106

Diamond, Carol .......................................................................................... 80

Marchibroda, Janet M. .............................................................................. 93

Powner, David ........................................................................................... 64

Letters, statements, etc., submitted for the record by:

Blue, Larry, vice president and general manager, Symbol Technologies,

prepared statement of ................................................................................... 117

Brailer, David J., M.D., PH.D., National Coordinator for Health Information Technology, U.S. Department of Health and Human Services, prepared statement of ........................................................................................ 25

Carr, Diane M., associate executive director, healthcare information systems, Queens Health Network ..................................................................... 108

Clay, Hon. Wm. Lacy, a Representative in Congress from the State of

Missouri, prepared statement of .................................................................. 19

Davis, Chairman Tom, a Representative in Congress from the State of

Virginia, prepared statement of ................................................................... 4

Diamond, Carol, M.D., managing director, Markle Foundation, prepared

statement of ................................................................................................... 82

Kolodner, Robert M., M.D., Chief Health Informatics Officer, Veterans

Health Administration, prepared statement of .......................................... 40

Kucinich, Hon. Dennis J., a Representative in Congress from the State

of Ohio, prepared statement of .................................................................... 123

Marchibroda, Janet M., chief executive officer, Ehealth Initiative and

Foundation, prepared statement of ............................................................. 96

McHugh, Hon. John M., a Representative in Congress from the State

of New York, prepared statement of ........................................................... 125

Porter, Hon. Jon C., a Representative in Congress from the State of

Nevada, prepared statement of .................................................................... 15

Powner, David, Director, Information Technology Management Issues,

Government Accountability Office, prepared statement of ....................... 66

Waxman, Hon. Henry A., a Representative in Congress from the State

of California, prepared statement of ........................................................... 8

(1)

THE LAST FRONTIER: BRINGING THE IT

REVOLUTION TO HEALTHCARE

THURSDAY, SEPTEMBER 29, 2005

HOUSE OF REPRESENTATIVES,

COMMITTEE ON GOVERNMENT REFORM,

Washington, DC.

The committee met, pursuant to notice, at 10:08 a.m., in room

2154, Rayburn House Office Building, Hon. Tom Davis (chairman

of the committee) presiding.

Present: Representatives Tom Davis, Mica, Gutknecht, Porter,

Schmidt, Waxman, Maloney, Cummings, Kucinich, Davis of Illinois, Clay, Watson, Ruppersberger, and Norton.

Staff present: Melissa Wojciak, staff director; Chas Phillips, policy counsel; Rob White, press secretary; Drew Crockett, deputy director of communications; Victoria Proctor, senior professional staff

member; Susie Schulte, professional staff member; Teresa Austin,

chief clerk; Sarah D’Orsie, deputy clerk; Phil Barnett, minority

staff director/chief counsel; Kristin Amerling, minority general

counsel; Sarah Despres, minority counsel; Earley Green, minority

chief clerk; Jean Gosa; minority assistant clerk; and Cecelia Morton, minority office manager.

Chairman TOM DAVIS. The meeting will come to order.

Millions of Americans are nearing retirement and will become

greater consumers of healthcare over the coming years. Innovations

are helping people live longer and healthier lives. In recent years,

information technology has brought great advances in quality, efficiency, and cost savings to almost all sectors of our economy. It has

been the driver of the American economy.

The Government Reform Committee has worked to ensure that

the Federal Government has access to the latest technology at the

lowest possible cost to bring the innovations of the private sector

to the public sector. We have witnessed the improvements in Government services that come from harnessing the power of information technology. Until now, however, the healthcare industry has

failed to embrace technology. Technology that could dramatically

improve the quality of healthcare and reduce cost.

We live in a world of IT systems that handle millions of transactions daily in real time. We interface with them quickly, and they

process our requests efficiently and accurately. We do this when we

transfer money, buy gas, or shop online. It is routine.

But the routine in healthcare is different. It is primarily a paperbased system of disconnected records and files in multiple locations. Doctors continue to write billions of handwritten prescripVerDate 11-MAY-2000 11:36 Dec 06, 2005 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 D:\DOCS\24713.TXT HGOVREF1 PsN: HGOVREF1
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tions every year, a significant portion of which are illegible, or involve incorrect or incompatible drugs.

According to one survey, only 15 percent of physicians are using

electronic prescribing systems, and only 3 percent of prescriptions

are processed electronically. Computerized order entry systems coupled with electronic health records offer enormous potential.

A more troubling routine is a healthcare system in which the Institute of Medicine reports that around 50,000 to 100,000 Americans die every year due to medical errors. A modern IT-based system could cut errors dramatically. One can argue that hospitals,

doctors, insurance companies, and the Government are endangering lives by moving too slowly in adopting electronic health records.

There is a direct link, in my view, between health IT and

healthcare quality and safety.

As we have seen recently with Hurricane Katrina, physicians are

often our second responders. They should have the support of the

same sophisticated IT systems as our first responders, enabling

them to respond to a crisis quickly, to retrieve and share the critical records of information that they need to save lives.

I hope we can bring a sense of urgency to this issue. The recent

events surrounding Hurricane Katrina highlight the need for accessible, accurate medical records and medical information. I am particularly interested in VHA’s experience during this period.

I hope the system that we create will help us share information

quickly, effectively, and securely, which is something we have been

pushing the Federal Government to do in all aspects of its operations. I believe we can enhance patient care by providing every

medical professional with instant access to life-saving information.

With the information technology available to us today, we can no

longer accept injury or death because of preventable errors.

Efforts to convert to electronic health records have met some resistance, however. Many stakeholders have been slow to see the

long term benefits that upfront investments in new technology can

bring. Small providers could be asked to bear burdens that benefit

others initially. Fewer than one in four doctors currently enter information into an electronic health record.

There will be other challenges as we move from a paper-based

system. Many hospitals and doctors’ offices are still lacking in information security, physical security, and privacy protection practices that will be needed with electronic health records, but we

have faced these challenges before.

In this committee, we work constantly to bring the best private

sector practices and procedures to the Federal Government to encourage information sharing, information security, and encourage

the efficient use of the latest information technology. Each of these

priorities is relevant to the health IT debate.

The healthcare industry is a fragmented and complicated marketplace. We need to exercise caution when we are asked to step

in with regulations and mandates. I am interested in learning what

level of governmental, including congressional, action is warranted.

We have seen a lot of action recently on health IT legislation,

and we have a unique opportunity. Many issues on Capitol Hill can

be divisive, but there appears to be broad bipartisan support for

health technology. Of course, anytime you propose dramatic

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changes that affect such a broad community, challenges will arise.

I hope we can continue to work together to solve them and move

toward the ambitious goals we have set.

The purpose of today’s hearing is to highlight the challenges and

opportunities that will come with the widespread adoption of

health information technology. The principles driving health IT are

the same principles the committee pushes Government-wide, bringing the best information technology, policies, and practices to the

Government at the lowest possible cost. It is a goal we will continue to support.

[The prepared statement of Chairman Tom Davis follows:]

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Chairman TOM DAVIS. Now I will recognize our distinguished

ranking member who has been very active, not just in the IT field

but the health field as well, Mr. Waxman, for his opening statement.

Mr. WAXMAN. Thank you very much, Mr. Chairman.

It is entirely appropriate for this committee to be holding an

oversight hearing related to the U.S. healthcare system, a system

in need of major improvement. There are more than 45 million

Americans without health insurance, and that number keeps rising

each year. Millions of Americans forego needed treatment or declare bankruptcy because of the cost of healthcare. Unjust disparities in access and outcomes are common across a wide range of conditions.

Today’s hearing addresses a small but important part of the solution to the healthcare system’s problems, the need for better information technology. A network of electronic medical records may

allow treating physicians to share information about a patient’s

condition quickly and efficiently, preventing redundant treatment.

Computerized warnings could stop medical errors. Access to key

patient data in an emergency can literally be lifesaving.

While improvements in health information technology may bring

many benefits, it will also bring new challenges. Privacy is a major

issue. There must be safeguards in place to ensure that patients’

health information is secure, and that the information will not be

misused.

Then there is the question of who pays. Creating an interoperable network of standardized electronic medical records is going to

be expensive. While many are convinced that these costs will be

more than offset by the savings these systems may offer, others are

not so sure.

Some experts have raised the concern that the projections of cost

savings are based on rosy assumptions. If the American taxpayer

is footing the bill, we need to ensure that we have a realistic understanding of what health information technology can actually deliver.

I look forward to learning about the promise of health information technology today, and I thank the witnesses for coming. And

I hope the testimony we receive today will form part of a broader

examination by Congress of problems facing our healthcare system.

Thank you, Mr. Chairman.

[The prepared statement of Hon. Henry A. Waxman follows:]

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Chairman TOM DAVIS. Mr. Waxman, thank you.

Jean Schmidt was appointed to the committee on September 15,

2005. She is a lifelong resident of Clermont County. She is the first

woman ever elected to represent southern Ohio in Congress. She

served for two terms in the Ohio State House. According to the

Cincinnati Enquirer, she proved effective in passing legislation to

address her district’s concern.

While serving in the State legislature, she enacted legislation to

create jobs, protect Ohio’s children, and ensure access to quality

healthcare. And prior to her election to the Ohio State House, she

served 10 years as a Miami Township Trustee.

She resides in Miami Township with her husband, Peter, and her

daughter, Emily. She holds a degree in Political Science from the

University of Cincinnati. And her other interests include auto racing and long distance running. Jean, how many marathons have

you done?

Mrs. SCHMIDT. Fifty-six.

Chairman TOM DAVIS. Fifty-six, so she will be well-suited to our

hearings. [Laughter.]

Fifty-six marathons and still counting, that is 53 more than the

chairman. I just want to say, welcome to the committee. We are

very pleased to have you here. And if you want to make an opening

statement here or not——

Mr. WAXMAN. Before you recognize her as a new member, I also

want to extend my welcome to her on behalf of the Democratic side

of the aisle to join our committee. You have run 56 marathons

more than I have run. [Laughter.]

Mrs. SCHMIDT. Well, in 2 weeks, it will be my 57th, hopefully.

Thank you so much, Chairman Davis and fellow members of this

wonderful Government Reform Committee. It is my honor to serve

with you.

I am very excited about the fact that our first topic is healthcare

because, in the Ohio Legislature, that was one of the chief concerns

that I had, that we have quality healthcare access to all individuals

in all walks of life. As an elected official, my top priority is to make

sure that our precious tax dollars are spent correctly and used efficiently.

My seat on this committee will allow me to work with all of you

to cut waste, streamline bureaucracy, and to ensure that we American citizens get the most from our Government. I am very excited

to work with you in the coming months. There is a lot of work to

do, so I am going to be quiet and let us get started. Thank you.

Chairman TOM DAVIS. Thank you very much. Any other Members wish to make opening statements?

Ms. Norton.

Ms. NORTON. I particularly appreciate this hearing. I am going

to be in and out because there are two other hearings at the same

time. I believe that one of the most important questions we could

answer is why the healthcare industry lags behind other industries

so substantially in IT.

It seems to be there is a very deep conundrum here. First of all,

you can call this an industry if you want to, but essentially a bunch

of people who deliver healthcare is what we are talking about. We

are talking about healthcare. We are talking about hospitals. We

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are talking about HMOs. We are talking about individual practitioners.

And to bring IT to such an important sector, scattered among the

neighborhoods, if you will, scattered in every part of our country,

would itself be a feat, especially if you want the system to be able

to talk to wherever patients go.

I see an up front problem, and that is the cost of healthcare

itself. Here we have hospitals, and HMOs, and those who provide

Medicare hardly able to keep up with the most inflationary part of

the economy.

So, in essence, if we are talking IT, especially IT beyond what

my doctor has, and she has it fine. It is in her office, but she isn’t

hooked up to every hospital in the District of Columbia. She isn’t

hooked up to where I might go somewhere in the country, if that

is what you are talking about.

If that is not what you are talking about, then I am not sure why

we are here. If that is what you are talking about, there has to be

some incentive for an industry that can hardly keep up with its

basic mission, which is providing healthcare for the American people, to in fact come forward with the up front costs that IT would

involve. What is the incentive for them to do that, to hook themselves up, or to put in systems that would allow themselves to hook

themselves up with whomever?

The beneficiary, it seems to me, in all of this would really be the

American people; it would be individuals, far more than providers.

Until we figure out who would benefit and who would pay the cost,

then the wonderful talk about IT is going to be just that. We are

not talking about putting in computers, I do not believe. We are not

talking about being as computer savvy as my doctor is. We are

talking about having your records, so that they would be accessible

wherever you go.

We are talking about the kind of use of IT that would mean doctors would be less often the objects of malpractice suits because

they know everything about a patient because they would be able

to find that through IT, in a way now it is even more difficult to

do.

So we kind of started with the back end of how great it would

be to hook us all up. Somebody has to tackle the hard question,

cost in an industry where cost is the primary question and cost in

a industry where 43 million Americans don’t have access to a doctor and could care less about IT.

Who would benefit? Would it really be the HMO? Would it really

be the hospital? Why should they do it if, in fact, the benefit would

be to you and me? Then it seems to me the Government of the

United States has to face that it is the American people who would

benefit, and somehow or the other the incentives have to be there

for that cost to be provided for us to benefit.

Thank you very much, Mr. Chairman.

Chairman TOM DAVIS. Thank you very much. Any other Members wish to make opening statements?

Mr. Porter.

Mr. PORTER. Thank you, Mr. Chairman. I appreciate the opportunity to speak on this important issue today.

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The subject of this hearing touches every single one of us in some

shape or form. Everyone here has gone to the doctor, some more

than others, but we understand what it is like to have to visit a

doctor or visit a hospital. Quality healthcare is of great importance

to everyone. However, notwithstanding the fact that the United

States is a world leader in healthcare science, its delivery and

management of healthcare is often outmoded and very inefficient.

Over 90 percent of the activities that go into the delivery of

healthcare are centered information and information exchange. If

this component is flawed in any way, the optimal delivery of care

will not be achieved. On July 27th the Subcommittee on Federal

Workforce and Agency Organization, which I chair, explored this

very issue.

During this hearing, we explored the potential of deploying

health information technology, its implications, and its potential for

success. At this hearing, we heard testimony from the Federal Government, medical experts, and others who are very interested in

deploying HIT for 8 million of our Federal employees.

Hurricane Katrina and Rita shed limelight over this issue. With

millions of Americans scattering from the Gulf Coast Region all

over the country, we soon realized that many of the hurricane victims would require adequate healthcare from many different doctors and many different hospitals. Many medical records were not

immediately available for patients, potentially putting some patients at even greater risk. We must make sure that situations like

this are avoided in the future. By deploying HIT, it would be a step

in the right direction.

One insurer, however, stands out as a stark example of HIT excellence. Blue Cross Blue Shield of Texas extracted data on its

members who lived in the areas that were evacuated before Rita

hit. To help physicians care for Hurricane Rita evacuees, Blue

Cross of Texas is making its members’ clinical summaries electronically available to physicians.

The summaries contain historical and current data such as lab

results, pharmacy information, basic medical history. Some of those

members won’t return home for several weeks, maybe even months

or years, because of the hurricane. Blue Cross took its payer-based

data for 830,000 members, and converted it into electronic health

records available to any treating provider for hurricane-affected

States, and did it for 4 days.

The benefits of computerizing health records are simply substantial. Health information technology will improve the quality of care,

reduce the redundancy of testing and paperwork, and virtually

eliminate prescription errors, prevent adverse effects from conflicting courses of treatment, and significantly reduce medical errors,

and reduce administrative costs.

The President, in announcing his 10 year goal, admonished the

Federal Government has to take the lead. The FEHB Program is

no exception and should leverage as buying power about 81⁄2 million participants to support President Bush’s goal and lead by example.

That is why in the next 2 weeks, I will be introducing legislation

called the Federal Family Health Information Technology Act. This

bill will provide every Federal employee and participant of the FedVerDate 11-MAY-2000 11:36 Dec 06, 2005 Jkt 000000 PO 00000 Frm 00017 Fmt 6633 Sfmt 6633 D:\DOCS\24713.TXT HGOVREF1 PsN: HGOVREF1
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eral Employees Health Benefits Program with an electronic

healthcare record and will effectively serve as the largest HIT demonstration project in the country.

No one can claim that moving information technology into the

healthcare industry is going to be easy; it is going to be difficult.

However, as the Blue Cross Blue Shield of Texas case demonstrates with payer-based data, there is no reason not to get started with the data that currently is available to the Federal Government. The HIT bill I will be introducing recognizes that there are

three components of electronic health record, and each component

will be phased in accordingly.

The first component is the payer-based record which will use

claims data and other information readily available to carriers. The

other components, a personal health record and provider-based

record will be phased in accordingly. The bill also requires carriers

in the program to provide each program participant with a walletsize electronic health record identification card within 5 years of

passage of this act.

As chairman of the subcommittee, I am committed to supporting

the President’s goal and this committee, full committee’s goal. Mr.

Chairman, I appreciate this opportunity. I look forward as the

hearing unfolds. But realize that we are so far behind in our technology, that many American lives are at stake. I look forward to

moving forward with my bill, which we will be introducing, and

others that have come before us.

[The prepared statement of Hon. Jon C. Porter follows:]

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Chairman TOM DAVIS. Thank you.

Ms. Watson.

Ms. WATSON. I want to thank you, Mr. Chairman, for having this

hearing this morning.

In reading over the analysis of this meeting, it says health IT

may be especially beneficial for inner city and rural populations

and other medically under-served areas. We all witnessed a month

ago how the under-served were those who were very, very ill or became very, very ill.

What I find our problem is, it is two-fold. No. 1, we don’t have

a national health insurance program, and we need to focus on that.

And No. 2, we don’t have the outreach. We all assume that communities are on the Internet. And so, as we go through these discussions around legislation, I would hope that our panels would address how we outreach in communities that are under-served. That

is our biggest problem.

I represent a city in California called Los Angeles, and it is

spread out. We don’t access; we don’t have IT; and we don’t have

outreach. People suffer from lack of information, and they suffer

from inaccessibility. So as we discuss IT, I hope we will broaden

out that discussion, so we can be sure the under-served is indeed

served through this new technology.

Thank you, Mr. Chairman.

Chairman TOM DAVIS. Thank you very much. Members will have

7 days to submit statements for the record. We are going to now

recognize our first panel.

I am sorry, Mr. Clay, do you want to say something?

Mr. CLAY. Thank you, Mr. Chairman.

Chairman TOM DAVIS. You are recognized.

Mr. CLAY. Just very quickly, thank you for calling today’s hearing on ways we can improve the use of information technology in

our healthcare delivery system. I welcome our witnesses today and

hope to partner with them in the future on transforming our

healthcare system into an electronically based model for medical efficiency.

In the coming weeks, like the other gentleman stated, I plan to

introduce a bill that will strengthen the Federal Government’s role

in developing and strengthening electronic health record standards

while allowing private sector stakeholders to remain innovative in

their own EHR implementation efforts. My legislation seeks to accomplish two major endeavors.

First, it would codify the office of Dr. Brailer and strengthen his

role as the leading health information standard setting organization in the Federal Government by establishing stringent milestones and compliance requirements for all Federal health agencies. We will reduce barriers to sharing health information between

agencies while providing the marketplace a model for efficient and

secure health information exchange.

Second, the bill will establish a loan program modeled after the

William D. Ford Direct Loan Program for Students for providing financing options among providers and organizations in the process

of establishing EHR systems. A major barrier to developing a nationwide health information network is the capital costs involved

with the design and implementation of the system, particularly

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among small providers lacking access to capital markets or specialized financial instruments.

I believe the Federal Government ought to foster its economic resources in a responsible manner to provide such capital where necessary, and our Direct Loan Program provides for us a model to do

so.

Mr. Chairman, this concludes my remarks, and I ask that they

be included in the record.

[The prepared statement of Hon. Wm. Lacy Clay follows:]

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Chairman TOM DAVIS. Without objection.

Do any other Members wish to make opening statements? Then

we will proceed to our first panel. We have Dr. David Brailer, who

is an M.D. and a Ph.D. He is the National Coordinator for Health

Information Technology at the U.S. Department of Health and

Human Services.

And Mr. Robert Kolodner, M.D., who is the Chief Health

Informatics Officer at the Veterans Health Administration. First,

let me thank you both for your service. It is our policy that we

swear you in before you testify, so if you would rise and please

raise your right hands.

[Witnesses sworn.]

Chairman TOM DAVIS. Thank you. We have a light in front of

you that will turn green when you start; it will turn orange or yellow after 4 minutes, red after 5. Your entire statement is part of

the record, and our questions are based on the entire statement.

So if we can keep within time, it helps. I won’t gavel if you feel

you need an extra minute or so because we want to make sure you

get your points across. This is important testimony. Dr. Brailer, we

will start with you and then go to Dr. Kolodner. Thank you very

much for being with us.

STATEMENTS OF DAVID J. BRAILER, M.D., PH.D., NATIONAL

COORDINATOR FOR HEALTH INFORMATION TECHNOLOGY,

U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES; AND

ROBERT M. KOLODNER, M.D., CHIEF HEALTH INFORMATICS

OFFICER, VETERANS HEALTH ADMINISTRATION

STATEMENT OF DAVID J. BRAILER

Dr. BRAILER. Thank you, Mr. Chairman and members of the committee. I appreciate the opportunity to speak with you today and

to continue our discussions about health information technology.

We are far along in our efforts to begin understanding what the

Nation’s work will be like to bring health information tools to our

doctors, hospitals, and consumers. There are three foundations that

have been strongly set. The first and most important is a clinical

foundation that essentially says that the use of health information

tools appropriately set up and appropriately trained for clinicians

save lives.

The second is a technical foundation that asks: Do we have the

components, and the pieces, and the know-how to do this? And we

believe that we have, if not all of it, most of it because of the opportunities already underway in many healthcare organizations as

well as other industries. The question of an economic foundation

which is, how does this get paid for and how does it generate economic value, is something that has been explored at length and

will continue to be as well.

We view there being two fundamental challenges around health

information technology, and they work together. The first is how to

get these important tools into the hands of doctors, and not just a

few but all, into the hands of other clinicians, into the hands of professionals, and consumers, institutions, clinics, and other settings.

This adoption challenge has many pieces that include financing,

culture, training, legal issues.

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And second is the question of portability of information, or its

interoperability which involves a separate set of issues about how

organizations and healthcare relate to each other and ultimately

how they can come together to deliver seamless care for each patient.

We are now ready to begin full scale implementation of the administration’s agenda, and I would like to summarize some of the

key steps that are underway in the next few weeks. The first is the

American Health Information Community which is a group comprised of 17 members, 8 of which are from the Federal Government, 8 from the private sector, and 1 from a State government.

This American Health Information Community will be the main

steering group for the health information technology agenda in the

administration. It will prioritize breakthroughs, a breakthrough

being some specific way that health information technology can be

useful to the American public. It will balance the short term goals

against long term issues as we buildup an infrastructure and a capacity in the United States to bring this across to all forms of

healthcare and to all the different constituents. It will ensure that

various voices are heard including those of key Federal agencies

like Medicare and the Office of Personnel Management in terms of

how they can participate and bring their Federal tools to this agenda.

Second, from that we will be setting up work groups to oversee

these breakthroughs. If, for example, a breakthrough is a personal

health record, or tools for chronic care disease management, or eprescribing, or bioterrorism surveillance just to name a few, each

of these will have a work group constituted of Federal, State, and

private leaders to ensure that we can move these agendas forward,

and address barriers, and work against a very specific timetable.

The American Health Information Community has its first meeting on Friday, October 7th. And we expect by the end of the year

to have the breakthroughs chartered, and charged, and working

against a timetable. At the same time next week, we will be announcing the Federal Government’s partner for standards harmonization.

We do have a significant number of different, somewhat overlapping, and ambiguous standards in the United States, and the

standard harmonization partner will help us align those into one

single fabric, one set of tools that can ensure that information can

be exchanged and shared seamlessly.

We will also be identifying our conformance certification partner,

which is another way of saying the entity that will help us determine what are the characteristics of an electronic health record

that is used by doctors and hospitals. We will be establishing a consortium of State leaders together to identify security and privacy

advances that are needed to protect information the coming Information Age and address the question of portability in the context

of that security.

And finally, later in October, we will be identifying the groups

of entities that will develop models, or architectures, or plans for

what the Nation’s capacity to share information looks like. There

are many technical components of these, and we are asking for six

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different groups to work, so we can extract from that and combine

the very best ideas of any of those groups.

My office has had the privilege of working with the private sector

recently in the health information response to Hurricanes Katrina

and Rita. I am happy to tell you that this was a remarkable experience by which many groups came together and operated well within the bounds of law to produce for up to 80 percent of the evacuees

a prescription data base in a secure, non-centralized data tool that

was available to physicians and shelters within 7 days. This remarkable experience will redefine what urgency is in health information and what it means to really break through and to address

real problems.

These actions that are underway will be supplemented by other

policies and other changes over the course of the next few months

that are needed to continue to drive both portability and adoption.

We have many things to do, but at this point we are underway,

and we expect to see significant progress over the course of the

next several months.

I welcome your interest in this topic, and I certainly look forward

to further discussion about it. Thank you.

[The prepared statement of Dr. Brailer follows:]

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Chairman TOM DAVIS. Thank you very much.

Dr. Kolodner.

STATEMENT OF ROBERT KOLODNER

Dr. KOLODNER. Good morning, Mr. Chairman and members of

the committee. I am Dr. Robert Kolodner, the Chief Health

Informatics Officer in the Department of Veterans Affairs. Thank

you for inviting me here today to discuss our work in the field of

health information technology.

Seventeen months ago President Bush outlined an ambitious

plan to ensure that most Americans have electronic health records

within 10 years. The President made his announcement during a

visit to the Baltimore VA Medical Center where patients have benefited from electronic health records for years.

Four months ago, HHS Secretary Leavitt issued a report which

concluded that the widespread adoption of IT should be a top priority for the American healthcare system and the U.S. economy. Collaboration between private sector organizations, and public sector

health entities such as VA, and activities like Connecting for

Health, and the eHealth Initiative were cited as a key factor in the

advancement of health IT.

One month ago Hurricane Katrina struck, and in minutes the IT

innovations we have been pursuing for years suddenly went from

esoteric to essential. My written testimony describes VA’s health IT

activities in greater detail, but I want to highlight in my oral testimony the benefits of these activities during this recent crisis.

VA’s Electronic Health Record, known as VistA, is recognized as

one of the most comprehensive and sophisticated electronic health

records in use today. As a doctor and as a patient, I am passionate

about the use of this technology and the very real effect it can have

on patients’ lives. It can mean the difference between life and

death.

How many of the Katrina evacuees with chronic medical conditions would have been spared additional suffering if their treatments and medications had continued without disruption because

their new physicians and access to their previous medical records?

What would have been the value to the millions of Katrina evacuees of we had a National Health Information Network in place to

support access to their complete health information regardless of

where the evacuees sought care?

For our patients, these capabilities are not the stuff of fantasy.

Our VistA system supports secure nationwide access to our patients’ health information and gives our providers a single place to

review test results and drug prescriptions, place new orders, and

update a patient’s medical history. VistA is used routinely at all

VA medical centers, outpatient clinics, and long term care facilities

across the country. That is over 1,300 sites of care.

Of course, electronic systems of any sort are not impervious to

natural disasters. In the aftermath of Hurricane Katrina, many of

the IT systems VA relies on were interrupted, and a great deal of

work was needed to restore network connectivity, email, BlackBerry service, and other telecommunications. While clinicians and

emergency personnel focused on saving lives, IT staff worked

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around the clock to restore access to critical patient care information.

Katrina had a significant impact on more than a dozen VA

healthcare facilities in the Gulf Coast Region. When Katrina hit,

the Gulfport VAMC was completely destroyed. New Orleans VA

Medical Center was forced to shut down their VistA system and

evacuate their patients when that city flooded. Although power and

communications were lost at the Jackson and Biloxi VA Medical

Centers, their VistA systems continued to operate within those facilities using emergency generator power.

Although medical records were temporarily unavailable for evacuated patients, within 1 day, we were able to provide access to

pharmacy, laboratory, and radiology results for all of these patients

using a regional data warehouse. With less than 100 hours of effort, we were able to bring the New Orleans VistA system back online.

And by the next week, when commercial telecommunications

were restored to Biloxi, the complete electronic health records for

all veterans were again available nationwide to help us serve these

veteran evacuees. Many patients affected by Katrina, such as the

282 veterans from the Gulfport Armed Forces Retirement Home

who were relocated to their sister campus less than 2 miles from

the Capital had minimal disruption in their continuity of their

healthcare.

The difference between the availability of electronic health

records and paper medical records is striking. Many or most of the

paper records in the affected areas may never be recovered. The result is that the majority of the 1 million people displaced by Hurricane Katrina have incomplete medical records or no medical

records at all, a consequence that will affect families and communities across the Nation.

This single natural disaster has reinforced the Nation’s need for

a host of technical advances from electronic health records and personal health records to secure communications networks. The VA

quick recovery of crucial health information after Hurricane

Katrina simply would not have been possible without VistA. Our

experience confirmed that VA’s health IT strategy, including our

new initiative to provide personal health records to veterans, has

been a good one as we continue to invest in, refine, and improve

our information technology solutions to support the future models

of healthcare.

One of the most important vehicles for achieving the President’s

vision for health IT is the AHIC which was discussed by Dr.

Brailer and convened by HHS. We are delighted that VA’s Under

Secretary for Health, Dr. Jonathan Perlin, will serve as one of the

17 AHIC Commissioners. I invite each of you to visit a VA medical

center to see our systems firsthand. We look forward to sharing our

systems, knowledge, and expertise with our partners through the

healthcare community.

Mr. Chairman, this completes my statement. I will be happy to

answer any questions that you or other members of the committee

have.

[The prepared statement of Mr. Kolodner follows:]

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Chairman TOM DAVIS. Well, thank you both.

Dr. Brailer, let me start with you. You mentioned the adoption

gap in electronic health records between large and small hospitals,

and you mentioned several areas you are focusing on to bridge that

gap. Ultimately, isn’t this about money and resources?

Dr. BRAILER. Money and resources are clearly one of the fundamental challenges, but there are also numerous other barriers as

well. I will just identify a few. First, to the financial resources, we

know that for many providers, they invest in health information

technology and can’t recover those investments. This is because either they are small or because of the way they are paid, but this

is a challenge for some organizations.

But beyond that, there is a technical capacity and technical

know-how. Many large organizations do have substantial resources

of experts about information technology and small organizations

don’t have that. Large organizations also have the capacity to operate, if you would, strategically to be able to understand how they

can get the benefits from these tools as they compete in the market, and many small organizations cannot.

So the gap of adoption is multifaceted and can’t be crossed only

with money. And it means raising the know-how of these organizations, providing to them resources to help them implement these

complicated systems, and re-engineer their workflows to change the

way their business operates, and to have the kinds of benefits that

other large organizations bring.

Chairman TOM DAVIS. Transforming the use of IT in healthcare

delivery is a huge task. What kind of incentives does the Federal

Government need to create to keep the private sector involved?

Dr. BRAILER. Many payers have looked at this question. And the

Federal Government is able to operate really in two ways with respect to this healthcare financing question. First, in CMS, and

Medicare, and Medicaid, there is activity underway through demonstration projects and forthcoming through MMA implementation

for CMS to provide incentives for health IT adoption through pay

for performance programs, essentially allowing organizations that

are paid somewhat of a differential for performance to be able to

get a bonus for health IT.

And this is consistent with how the private sector has viewed the

role of other payers providing ultimate payment for the value that

health information technology brings. Second, through organizations like the Office of Personnel Management, many other purchasers of care, other large employers are looking at how to direct

their health plans and other carriers to support health information

technology adoption among providers. There are many ways, and

this is consistent with how we view the Federal Government’s role

of being a catalyst and a purchasing promoter of good health IT.

Chairman TOM DAVIS. Dr. Kolodner, has VA’s VistA project been

able to demonstrate any improvements in quality of care?

Dr. KOLODNER. Yes, Mr. Chairman. The VA’s VistA system is

part of a suite of activities including performance measure that VA

has used to improve its quality of care over the last 10 years, and

we currently have quite a number of performance measures that

are published in the literature that show that VA’s quality of care

meets or exceeds that quality of any other healthcare system in the

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country. There have been reports by the Rand Corp. that have been

published to that effect, and other measures that we have.

Chairman TOM DAVIS. Dr. Brailer, recent articles report that the

State and public health officials, who have a lot to gain from the

improved use of IT in healthcare, are feeling excluded from national strategy efforts. Are you working to better include health IT

efforts? Do you think these are justified? Are we doing things like

establishing regional health information organizations and national

health information networks? Can you talk a little about that?

Dr. BRAILER. Sure. I am unaware of those reports, and I am

frankly surprised by them. I think one of the most interesting and

useful aspects of health information technology is the grassroots

nature, both at the State and community level.

We have seen more than 200 regional areas come together and

form regional health information organizations where a local group

is able to begin understanding what they can do to bring these

tools to their doctors, hospitals and consumers, to be able to address privacy concerns and other security issues, to support adoption financing and other things. It is a remarkable effort, and it is

something that didn’t happen at the behest of the Federal Government or at any other entity; it came together because of this broad

grassroots interest.

Also, many States are involved and have activities underway. I

have personally visited 20 States so far that have health information technology efforts underway, and we are working very closely

with them. This one new collaborative relationship we are about to

establish around security and privacy will be directly with States,

working together to understand how we can advance security and

privacy rules.

So I think that there is a significant amount of activity underway, and we work very closely with them, and I certainly look forward to expanding that in the future.

Chairman TOM DAVIS. Thank you very much.

Mr. Clay.

Mr. CLAY. Thank you, Mr. Chairman, and I thank the witnesses

for being here.

Dr. Brailer, there is no questioning the leadership you have provided the Government in the area of electronic health records, but

I am concerned that you do not have adequate resources or authority to bring all Federal agencies into compliance. What barriers do

you see having an impact on getting the Federal agency community

to adopt and implement health informatic standards developed

through your office? Has there been agency resistance to particular

initiatives begun by your office?

Dr. BRAILER. First, thank you, sir. I appreciate the support for

what we are doing.

It is certainly the case that before this office was created, many

different Federal agencies viewed them having a charge to support

health information technology, or standards, or things related to

this.

And as you might not be surprised to know, they worked somewhat independently, agencies in the Veterans Affairs Department,

DOD, and HHS. I have been very well received by these agencies,

in fact more than I expected, and beyond that we have had very

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good working relationships with them to address these

foundational questions on standards.

Let me give you two examples. We will announce this new partner for standards harmonization, and that entity will be an entity

where all the Federal agencies come together, along with the private sector, to agree on a common set of standards. And this has

been done with and through the agencies.

Second, in our certification partner, it is the same thing, where

many agencies are involved in this effort, and we will look and take

their cues from that as well. We are doing other things internally

to make sure we have alignment in our goals and alignment in our

plans, but I would never characterize our relationships with the

agencies as not cooperative and not focused on the same goal.

There are certainly more things we can and will do, but I am very,

very happy with the amount of progress that we have made to

date.

Mr. CLAY. That is good to hear. Perhaps this is somewhat forward thinking, but can you expand on the measures and outcomes

you will be utilizing to demonstrate progress and efficiencies

achieved through a nationwide health information infrastructure?

Are there sufficient tools in place to measure the benefits of implementing an interoperable standard structure for electronic health

records? And also, have you thought about how to protect the privacy rights of patients?

Dr. BRAILER. Thank you. It is something that I am happy to

speak about. We actually very soon will be announcing a contract

with an independent third party that will perform an annual survey that looks at the adoption of electronic health records and the

electronic transactions that share clinical data.

And that gets to the very base level of: Are these tools being put

in place? Are they being put in place across both urban and rural

settings, across large providers and small, in different specialties or

different other settings? We want to understand that, and we want

it to be done objectively. So that will be underway starting this

year.

There are two levels above that. One, given that these tools are

adopted, the question becomes: Are they being used? And we have

been working with a variety of organizations that already inspect

or observe what clinicians do in their offices or what hospitals do.

They are onsite, like NCQA and the Joint Commission, to understand what they can do to being looking not at adoption but are

they being used.

And then the final question, and the one where we all want to

be, is: What are the outcomes? I have been very encouraged by the

studies that are done in some of the large pay for performance

projects, where organizations that do have health information technology do substantially better in their performance than those that

do not. So we want to look for the final value that is realized by

the American public.

And to your comment, there are negative outcomes, the potential

for privacy breaches or new abuses that come from this data, and

this is exactly what the Security and Privacy Consortium will

speak to. What do we need to put in place at a business policy or

a public policy to ensure that as we move into the Information Age

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that we have policies and tools to take us there as well? We will

be watching for complaints, privacy breaches, things that are already being reported but asking an additional question about: Is

this related to an information tool, or is it paper?

Mr. CLAY. That is reassuring to know that you are sensitive to

the privacy issues and how we protect the patients to the utmost.

One last question, the Federal Government seems to be an appropriate vehicle to coordinate the development of a National EHR

System but have State and local governments begun the widespread use and implementation of these systems?

Dr. BRAILER. We have had, as I commented with the prior question, very encouraging relationships and progress with States, but

it is variable. There are about 20 States that have been quite enthusiastic, that have come forward and are working with us, that

are looking at how they can incorporate support for health IT in,

for example, their Medicaid program, or in looking at their own

State privacy laws, or at licensure issues, or at encouraging adoption in State funded or county-funded clinics and other settings.

And then other States are, I would call, neutral. We have none

that have really been adverse or opposed to this, but there are

some that I think see differential priorities, other things they have

to do first. So we are working more with the willing today, but we

want to create an imperative where all the States see this as something fundamental to what the State government does.

Mr. CLAY. Thank you for your response. Thank you, Mr. Chairman.

Chairman TOM DAVIS. Yes, ma’am, the gentlelady from Ohio, any

questions?

Mrs. SCHMIDT. No, thank you, Mr. Chairman.

Chairman TOM DAVIS. Mr. Gutknecht.

Mr. GUTKNECHT. Mr. Chairman, I am not sure I have a question

as much as a comment.

First of all, thank you for this hearing, and we really do appreciate it. I have a keen interest in this whole subject, and I think

as we go forward, this is going to become more and more important. I am delighted that at least there are people inside our Government who do take it seriously.

Let me talk about this from a somewhat different perspective. I

also chair a committee of the Rural Caucus that has been interested in telecommunications policy. Ultimately, this issue and telecommunications policy do meet, and they are inexorably intertwined.

One of the things that we learned, and I suspect that you have

probably already bumped into this, and that is that an awful lot

of the constituencies for the services we are talking about here

today live in small towns. Many of those small towns do not have

the same kind of broadband access that some of us in larger communities take for granted.

We had three separate hearings. What we learned in those hearings was that one of the things that is important, if we are going

to continue to build out broadband services to small towns and

rural parts of America, is that we have to have a Universal Service

Fund. I don’t know how familiar you are with that, but it is important to those small, rural providers. In Minnesota, all of the teleVerDate 11-MAY-2000 11:36 Dec 06, 2005 Jkt 000000 PO 00000 Frm 00059 Fmt 6633 Sfmt 6633 D:\DOCS\24713.TXT HGOVREF1 PsN: HGOVREF1
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communications people want to serve Bloomington, MN; not many

want to serve Blooming Prairie, and that is a big problem.

That problem becomes worse because the telecommunications

business is changing and evolving even as we speak. A year ago I

didn’t know what VOIP was, but it is a fact of life, and it is going

to become more and more important. Voice Over Internet Protocol

is going to become more and more important. What we have is

more of these companies who want to use the network, so to speak,

but they don’t want to help pay for the network.

I think this is for the benefit of members of the committee as

well. I understand that the Commerce Committee here in the

House is working on a telecom bill, and we hope to have it out on

the floor. And it is going to have some good things in it.

I don’t want to be critical, but one of the most important things,

I think, is going to be ignored. That is: How are we going to deal

with this Universal Service Fund in a telecommunications industry

that is changing so fast? I am afraid that all of the good work that

you are doing here on this area, well, not all, is going to be wasted,

but some is going to be wasted because we don’t have that last mile

and we don’t have an awful lot of our rural communities included.

If we don’t come up with a reasonable solution to the Universal

Service Fund issue, who pays and who gets to draw out, and for

what services can it be used for? It strikes me that is going to be

very, very important to your deliberations as you go forward.

Dr. BRAILER. Perhaps just a comment on that, I certainly can’t

comment on the Universal Service Fund, but I think it is not coincidence that the President announced the health information technology agenda in the same speech where he announced the administration’s broadband efforts. They are part and parcel.

We need that infrastructure to do the things that we are discussing, and the things that are happening here give value to why

those broadband networks need to exist. I think this is particularly

true in rural areas as you described because today we are talking

about the sharing of labs, and prescriptions, and other things that

are not very heavy in bandwidth.

But not too far out we are talking about telemedicine, and remote video, and monitoring live feed devices that are in people’s

homes or on their bodies for monitoring their physiological status,

and those are bandwidth dependent. So I think this is moving very

quickly where it will become something where we will say, here is

a value that broadband will give us.

This is an issue that I am particularly sensitive to, being from

a very small town in West Virginia that has an 18-bed hospital

that I am proud to tell you my mother is on the board of. We look

at this quite a lot and say: How do we make sure that we are raising the playing field for everyone?

Mr. GUTKNECHT. You say that you can help us by putting a little

pressure both on the administration and some of our colleagues in

Congress, but ultimately we have to resolve this issue of the Universal Service Fund because all the other efforts we have, I think,

dwarf in terms of the relative importance to rural communities in

building out that broadband service.

Because if we don’t get that done, all of these magic things, and

I have seen a lot of them, and I agree with you. The potential of

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this is enormous. But you can’t do that if you don’t have the wire

or the cable to carry the information.

Dr. BRAILER. I will make sure that message is conveyed.

Mr. GUTKNECHT. Thank you.

Dr. BRAILER. Thank you.

Chairman TOM DAVIS. Ms. Watson.

Ms. WATSON. From the outside looking in, what would you suggest we do here? Now we were just discussing the fund, and if this

is going to work to service the entire Nation, and I would hope it

would do that.

What do you see as the obstacles? How could we remove them

and make it work in the small areas that most of this technology

never reaches? And how do we get to the under-served? What

would you suggest? I address that to both panelists.

Dr. BRAILER. Thank you.

Ms. WATSON. And blue sky, you know. Don’t worry about the

budgetary restraints; let us worry about that. What would you suggest to make this an effective, operational system?

Dr. BRAILER. Thank you. I don’t get asked to do that very often.

[Laughter.]

Again, I think we need to recognize that if we look at, for example, an urban population or a population that is under-served, their

healthcare system has numerous challenges around delivering

basic services in addition to health information technology.

So if you look at, for example, many community clinics or countyfunded clinics, they have certainly financial challenges of being

able to support the adoption and use of tools, but they also have

a significant manpower issue in terms of just skill base, people that

understand technology, being able to negotiate the contracts to procure the services, etc. I think it is a combination of support financially plus the kinds of know-how.

One of the things that, in the tool that has come out through

CMS from VA, the VistA Office EHR, the one area where we think

there is real opportunity is being able to make that tool available

into those kinds of settings because it can give support, but it also

involves not a lot of the legal issues around negotiating those contracts and other things.

How the funding actually comes to be, I certainly couldn’t comment, except to say that I have been impressed at the variability

of Medicaid programs and the extent to which they either take a

forward leaning posture on technology use in clinics and other settings, or they don’t.

I am encouraged to see some of the ones have been quite supportive, and I have visited a number of clinics that I think would

by far exceed what many private sector providers have in terms of

their technical capacity to really care for patients in a seamless

way. So I think it can be done, but I would not say it is money

alone. I am really worried about the Nation’s overall manpower

supply of experts in this field, particularly how it is distributed into

those settings.

Ms. WATSON. What resonated with me in the beginning of your

statement was the fact of training. I ran a program back in the

1960’s at UCLA and Allied Health. We said, 10 years from now,

that was 1960, there will be 10,000 new jobs that we don’t know

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about today. Well, there must be 300,000 new jobs that correspond

to the developing technology.

So maybe there should be a training component. Whatever we

do, we ought to have a training component so we will have personnel out in the field that can indeed utilize this new technology to

its fullest extent. I appreciate your input, and I ask my staff to

take notes because maybe we will come up with a piece of legislation in addition to what is already on the table.

Dr. KOLODNER. I think also the idea is the technology has to

adapt to the individuals. All of us can use telephones right now;

they are simple to use. Trying to program your VCR still is a challenge for many people.

I think that as those of us who are in the technology field look

forward, particularly as we get into the personal health records

which I think will, in fact, revolutionize the relationship between

the providers and the patients—raising it up so that the provider,

in fact, becomes the expert counsel to the patient instead of the

caretaker for the patient and empowers people to take control of

their health as they move forward. Things like the personal health

record, or even the electronic health record for the providers, have

to be simple to use; they have to be understandable; they have to

be able to be tailored to the particular style, or reading level, or

others of the person who is using it.

Ms. WATSON. Thank you.

Chairman TOM DAVIS. I recognize Mr. Porter.

Mr. PORTER. Thank you, Mr. Chairman.

Dr. Brailer, are there still a lot of disincentives out there for the

industry to get into technology, the providers? Are there some barriers that we should be breaking? It seems to me we do a lot of

Government incentives, and there are grants, low loan rates, which

are all good things. Assuming that there are some barriers, which

I think there are, is there something we can do market-driven, to

help jump start this?

Dr. KOLODNER. Let me start just by saying that one of the

things, if you look at VA, Kaiser Permanente, DOD—where there

have been advances for large systems in the use of the information

technologies—they are systems where the systems are both the

provider and the payer because it is really on the payer side that

a lot of the benefits occur. Actually, it is at the level of beneficiary.

But in terms of the people who are making the decisions, the

payer gets the benefit of not having duplicate tests and being able

to operate more efficiently. Over the last 10 years, VA has doubled

the number of patients that we have seen with only about a 15 percent increase in our budget at a time when healthcare has been

double digit. Not all of it, but a good part of it, had to do with putting in the electronic health records, helping us to be more efficient.

Dr. BRAILER. It is a great question. It is one that we obviously

spend a lot of time with. It is no surprise that large physician

groups or prepaid group practices are among the Nation’s leaders

in the use of advanced health information technology because they

live in a world that has both clinical care and bottom line risk in

the same organization, and they have few, if any, barriers to collaboration between doctors and institutions.

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Mr. PORTER. Plus, they have the resources in many respects.

Dr. BRAILER. Sure, they do. As we think about how do we extend

that across the industry, I think the question is not how do we provide incentives per se, but how do we take away the perverse or

the contrary incentives to not invest because it is against the financial interest of many providers to actually put in tools that improve

quality or improve efficiency. That is because we pay for volume,

and efficiency and quality by definition reduce volume.

So that is a real challenge I think that is across the industry.

Many physicians and hospitals want to do the right thing if we

could at least make the incentives neutral with respect to that.

Second, there are barriers to doctors and hospitals cooperating

around the care of their patients in a way that can improve quality. Health information technology is just one, one very large but

just one, of those areas.

Then third, as we move toward this concept of interoperability,

most of the technical infrastructure is built with the concept of

somewhat proprietary data, that the data is very difficult to move

and that many of our technical companies make a lot of money in

their revenue cycle from implementation of somewhat standardized

tools. In a world that is highly interoperable, or plug and play,

means a fundamentally different kind of value stream for them as

well. So there are barriers up and down the supply chain of health

IT, if you would, that need to be addressed.

Mr. PORTER. Mr. Chairman, if I may continue. It was mentioned

earlier there are those pockets in the country that are under-served

by healthcare and technology. One of my goals in the legislation I

am proposing is if you take a group the size of the Federal Government, 91⁄2 million people, and by having the proper encouragements in place to have the providers, doctors, and the patients involved in the system, it hopefully will flow into the rest of the free

market system because the systems will be in place.

But I know that there are small doctors that are piecemealing

systems because they can’t afford to get into it, like the clinics and

the combinations. There are small doctors across the country that

would like to, but then there are those that don’t want to change.

There is the culture of this is the way we have always done things.

It seems to me if we can help provide an incentive, a marketdriven incentive to make sure that those doctors that use the latest, and providers throughout the system use the technology, there

may be some incentive to reduce their medical liability insurance,

and have medical liability carriers engaged in finding a way to provide assistance because it reduces, of course, the loss of life and injury, but on the dollar side reducing some costs. So part of the legislation I am working on will hopefully provide some incentives to

reduce medical liability insurance costs because the losses are

fewer, which in turn could be returned.

I understand there are lots of barriers. We have to come out of

the Dark Ages as soon as possible. I appreciate what you are doing.

You guys, you are on the cutting edge. I am not sure about the title

of our hearing, the Last Frontier. I think this is the frontier; we

are there. I appreciate what you are providing for us today, and I

look forward to working with you.

Chairman TOM DAVIS. Thank you.

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Ms. Norton.

Ms. NORTON. Thank you, Mr. Chairman.

I appreciate that you have talked about some of the barriers.

They are pretty big barriers. I spoke about one barrier. Mr. Porter,

who has just spoken, had a hearing in another of our subcommittees on which I serve on this issue. It is absolutely fascinating because of how hard it is to get a handle on it. It would be hard

enough if, given the decentralized nature of the sector, if costs were

the only barriers, but when you really get into interoperability and

you get into other technical matters, you get into personal matters,

and cultural matters, and professional ethics, and age, they are

quite awesome.

I am interested in the VA. When we had our hearing in subcommittee, it was a subcommittee that deals with the Federal Government and Federal workers. I noticed, Dr. Kolodner, that on page

6 of your testimony, you say, you use an example which is the best

way to make people understand a subject like that.

You said, suppose a veteran comes in for a check-up and tells a

physician he is allergic to drugs, etc. So the first thing I want to

know is once a veteran is in the system in one part of the country,

does that mean his records are accessible in every veterans’ hospital throughout the country?

Dr. KOLODNER. Yes, it does, whether that is progress notes,

whether that is lab results, radiology reports. Actually, starting

this month, we started rolling out a new capability so that all of

the images that exist at one hospital are available in any another.

Ms. NORTON. I just think this is very important. This isn’t going

to happen unless the Federal Government shows it can happen.

And here we have closed system here. We are the Government. We

can make things happen in our organization, the largest organization in the country in a way that even the largest HMOs would

have more difficulty because we can appropriate money.

We can do it through pilot projects, or we can look at what the

Veterans Administration is already doing, and remove some of

these barriers simply by showing, in fact, what the benefits are.

The benefits are to all involved, but that is certainly not immediately apparent to all involved in today’s healthcare world.

You say, for example, on page 9 of your testimony that about 40

percent of veterans that come to one of your facilities each year receives care some place out from non-VA physicians, and you are

now beginning to tackle that notion. I see you as a possible pilot

here. When you go from your own system, which you appear now

to have a hold of, you now have to deal with the fact, the kind of

situation rather, that healthcare outside of the Government will

face.

I would like you to discuss how you expect to be able to do for

that 40 percent what you can do for those within your system and

what you can do about keeping track within your system. It might

not matter if, in fact, you get somebody seriously ill, for example,

who normally does not come to your system—and perhaps you both

have talked about Katrina and Rita—if, in fact, healthcare is normally received outside of your system. Will you speak to that,

please?

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Dr. KOLODNER. Yes. The figure that you cited, the estimated 40

percent of veterans we treat each year getting care outside of VA,

is one of the very reasons why VA has been very active both in the

area of standards development that was mentioned earlier as well

as the close working relationship we have with Dr. Brailer’s office

and our active participation in public/private initiatives such as

those you will be hearing about on one of the subsequent panels

with the eHealth Initiative and the Connecting for Health.

That allows us to work with others because we are not going to

be able to solve this alone. We need electronic health records on the

outside. We need those National health information networks that

we can connect into. We can certainly contribute our experience,

the things that we have learned along the way as we have brought

up the systems and connected our hospitals, and as we have

worked with the Department of Defense to connect these two large

departments, and where we are moving information back and forth

bi-directionally between the two departments in order to help our

veterans, some of who are getting care at the Department and Defense.

But it is really in the public/private initiatives and with Dr.

Brailer’s office, where they have the charge for these broader community initiatives that we are really able to——

Ms. NORTON. So you are really not able. If this veteran who is

not in your system comes in, and now you have a lot of information

that you get from him, are you able to connect with his HMO, let

us say, if in fact that HMO could speak to you through your system? Would some of the barriers that we have been discussing be

such that you could feel that you could use IT to retrieve data

about him rather than relying on the old-fashioned methods?

Dr. KOLODNER. We can’t do that today. That is the goal, and that

is to work with the regional health information organizations and

with these other organizations in order to establish the standards,

the protocols, and the rules of the road for accomplishing exactly

what you are talking about.

Ms. NORTON. Dr. Brailer, I must say, I see what your doing. It

is very complicated. I really think in the busy world of HMOs and

physicians, it is so complicated that unless somebody can set up a

pilot that somebody sees works, this is just not going to work. The

best, it seems to me, possibility might be within the VA and some

kind of pilot involving the VA and patients who are not regularly

in VA or who are sometimes in VA and sometimes not in VA, because setting people down to even want to do this is a task unto

itself.

The cost task is such that even in your testimony, Dr. Brailer,

you are cautious, and I think that is being very responsible about

whether anybody should be promised cost savings. Ultimately, as

with almost everything in our country, if we see a system that

works in this way, that has solved the considerable problems in

your testimony, it seems to me that we will have a better chance

of connecting our healthcare system than I see us having now.

I just think this is a show-me country and if we can’t show the

country a system that works, then I think we are not going to be

able, in the context of costly healthcare today, to move ahead, particularly when it is normally provided by private parties.

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Thank you, Mr. Chairman.

Mr. GUTKNECHT [presiding]. Mr. Ruppersberger.

Mr. RUPPERSBERGER. Sure. Excuse me if I duplicate some of

these questions, but I had to come late.

First, there are many issues involving a national health information system, but one of my major concerns is making sure that the

various healthcare systems nationwide can talk to each other. It

serves no one any good if we have a bunch of networks and data

bases that can’t talk to each other and that are not centralized.

Now where are we as it relates to where you are and where we

need to move forward as far as the systems talking to each other?

Dr. BRAILER. We have what I would consider to be numerous

pieces that are now coming together. We have, for example, in the

regional and local areas these 200 or more projects that are trying

to build the capacity to do what you described, to share information, to talk together, to make it seamless. And those organizations

go from those that who do have actually very good demonstration

sites of what has happened to those that are still moving forward,

including one here in D.C.

At the same time at the Federal level, we are trying to make

sure that there are a single set of standards and a capacity, this

national health information network architecture that can tie these

together. So we are trying to converge all of those pieces together

to make sure that the easy thing for a doctor or a hospital to do

is to be online and sharing their information with other doctors and

hospitals as the patient permits.

Mr. RUPPERSBERGER. Are there any lessons learned that you can

pass onto the private sector in your efforts to create an electronic

health record system? Anyone?

Dr. KOLODNER. There are many lessons that would be something.

Actually we have a report the GAO did where we talked about lessons learned between VA and DOD in terms of the information exchange. The ability to meet the needs of the provider, and make

sure that the systems are fitting the workflow, and are not designed from the outside by non-clinicians but actually are shaped

by the needs of clinicians, so that it fits into their clinical practice

is an important way of succeeding with the electronic health record

part.

But the focus really needs to remain on the fact that IT is an

enabler. It is not an end itself; it is the means for delivering better

quality of care and safer care.

Mr. RUPPERSBERGER. Let me talk about the issue of barriers.

Sometimes we, in Congress, try to fix a problem and when we fix

it, it sometimes makes the problem worse. Even though we need

to deal with the issue of confidentiality, I think HIPAA is an example.

It seems to me that people in the medical field, from either a hospital perspective or doctors, are involved in so much paperwork

now, that even HIPAA has gotten to the point of maybe giving people excuses, some in the medical field: When you have a parent

that has dementia, well, I can’t talk to you because of HIPAA. It

has also been said that HIPAA is great for the paper business because there is a lot of paper generated.

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How would you look at the issue of HIPAA as it relates to what

we are talking about here today, and how would you solve maybe

some of the tremendous administrative wastes of time and personnel that are focusing more on HIPAA than actually treating patients?

Dr. BRAILER. I think HIPAA is a good example of where the information age can be advantageous in many ways. For example,

providers do have concerns about being burdened with the costs of

accounting and disclosure. Information-based exchange is much

less manually intensive. It is cheaper for them to keep track of who

they gave data to and how to release that data.

So I think information tools are actually a positive thing in a

HIPAA world. Second, with respect to consumers that want to get

their data, electronic data is easier for them to get, and get access

to, and give to third parties. The information age, I think, will let

consumers be much more engaged in not just getting their information but controlling who has access to it.

I think the one challenge, not really in HIPAA but across the

States that have often superceded HIPAA with their specific State

requirements, is the concept of flexibility. Flexibility here means

that the way a hospital or a doctor implements their security and

privacy regime varies from very small organizations to very large

ones.

That flexibility is often at odds with data portability. It is not a

security or privacy issue, per se; it is an issue about whether or not

those create barriers to information exchange. That is exactly what

this project is going to do, where we bring together all the State

leaders and regional leaders to understand what they can do to

have both flexibility and data portability at the same time. So I

think it is a positive step, and we will be looking at that from the

perspective of what are the protections or guidances needed to

make sure that we can protect data yet have it be portable as the

patient chooses.

Mr. RUPPERSBERGER. OK, thank you.

Chairman TOM DAVIS [presiding]. Any other questions? If not,

that is all I have for this panel. We appreciate it very much.

Just let me ask, in the interest of time, we are going to combine

panels two and three. We appreciate this very much. We will take

a 2-minute recess. And I want to thank Mr. Powner for his flexibility and assistance in letting us go to two panels, so we can try to

get to a prospective noon vote.

On our second panel, we have Mr. David Powner, who is the Director of Information Technology Management Issues at the GAO;

Carol Diamond, M.D., the managing director of the Markle Foundation; Janet Marchibroda, who is the CEO of eHealth Initiative

and Foundation; Diane Carr, who is the associate executive director of Healthcare Information Systems, Queens Health Network;

and Mr. Larry Blue, the vice president and general manager of

Symbol Technologies.

[Recess.]

Chairman TOM DAVIS. As you know it is our policy that we swear

everyone in. If you will rise with me and raise your right hands.

[Witnesses sworn.]

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Chairman TOM DAVIS. Thank you very much. We will start with

you. I think everyone understands how we try to operate on time.

With GAO, if you need a couple of extra minutes to do it, your

whole report is in the record, and we have worked up questions

based on the entire testimony, but take what you need to highlight

what you need.

Thank you all for being with us.

STATEMENTS OF DAVID POWNER, DIRECTOR, INFORMATION

TECHNOLOGY MANAGEMENT ISSUES, GOVERNMENT ACCOUNTABILITY OFFICE; CAROL DIAMOND, M.D., MANAGING

DIRECTOR, MARKLE FOUNDATION; JANET M.

MARCHIBRODA, CHIEF EXECUTIVE OFFICER, EHEALTH INITIATIVE AND FOUNDATION; DIANE M. CARR, ASSOCIATE EXECUTIVE DIRECTOR, HEALTHCARE INFORMATION SYSTEMS,

QUEENS HEALTH NETWORK; AND LARRY BLUE, VICE PRESIDENT AND GENERAL MANAGER, SYMBOL TECHNOLOGIES

STATEMENT OF DAVID POWNER

Mr. POWNER. Chairman Davis, Ranking Member Waxman, and

members of the committee. We appreciate the opportunity to testify

on healthcare information technology. As we have highlighted in

several recent reports completed at your request, Mr. Chairman,

significant opportunities exist to use IT to improve the delivery of

care, reduce administrative costs, and to improve our Nation’s ability to respond to public health emergencies.

This morning I will briefly describe the importance of defining

and implementing standards to achieve the President’s goal of nationwide implementation of interoperable healthcare systems. I will

also summarize key administration efforts to further define standards and conclude by highlighting key items for consideration.

IT standards enable the interoperability of data and systems and

defining such standards can help speed the adoption of IT for the

healthcare industry. For example, standards are essential to provide greater consistency of patient medical records. Standards-driven electronic health records have the potential to give caregivers

with complete and consistent medical histories necessary for optimal care. Standards are equally important as systems are pursued

to detect and respond to public health emergencies including acts

of bioterrorism.

This past summer, Mr. Chairman, we issued a report to you that

highlighted the importance of developing and adopting consistent

standards to enable interoperability of key surveillance systems

like CDC’s BioSense and Homeland Security’s BioWatch. Despite

this critical need, today’s standards are uncoordinated and have resulted in conflicting and incomplete standards. We recommended

several years ago that the Secretary of HHS reach consensus

across the healthcare industry on the definition and use of standards and to create mechanisms to monitor the implementation of

standards.

HHS has taken several actions that should help to define standards for the healthcare industry. First, the coordinator has assumed responsibility for the Federal Health Architecture which is

expected to include standards for interoperability and communicaVerDate 11-MAY-2000 11:36 Dec 06, 2005 Jkt 000000 PO 00000 Frm 00068 Fmt 6633 Sfmt 6633 D:\DOCS\24713.TXT HGOVREF1 PsN: HGOVREF1
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tion. This architecture effort now also includes the Consolidated

Health Informatics Initiative, one of the original OMB eGov initiatives to facilitate the adoption of Federal healthcare standards.

Second, HHS agencies continue to identify standards including

those for clinical messaging, drugs, and biological products. Third,

HHS plans to leverage private sector expertise by awarding a contract to develop and evaluate a process to further define industrywide standards. In addition, HHS also formed a public/private committee to help transition the Nation to electronic health records

and to provide input and recommendations on standards.

The importance of a national health information network that integrates interoperable data bases was just recently highlighted on

a smaller scale with the coordinator facilitated the development of

a web-based portal to access prescription information for Katrina

evacuees. This online service is to allow authorized health professionals to access medication and dosage information from anywhere

in the country and was made possible when commercial pharmacies, health insurance programs, and others made accessible the

prescription data.

Although Federal leadership has been established, and plans and

several actions have positioned HHS to further define and implement relevant standards, consensus on the definition and use of

standards remains a work in progress. Key items to consider as the

administration moves forward with this vital effort are completing

detailed plans for defining standards that include private sector

input, fully leveraging the Federal Government as a purchaser and

provider of healthcare, enlisting consumer support to a point where

patients demand electronic health records, and providing incentives

for the private sector to participate and partner.

In summary, standards are essential to achieving interoperable

data and systems, and are critical in the pursuit of electronic

health records and public health systems. Clearly, vision and leadership are now present, but detailed plans associated with the National framework remain incomplete, and we are still quite far

from sufficiently defining standards necessary to carry out this vision.

Once this occurs, the healthcare industry will confront the more

difficult challenge of consistently implementing a comprehensive

set of standards. Until these standards are implemented, the

healthcare industry will not be able to effectively exchange data

and, consequently, will not reap the costs, clinical care, and public

health benefits associated with interoperability.

This concludes my statement. I would be pleased to respond to

any questions that you have.

[The prepared statement of Mr. Powner follows:]

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Chairman TOM DAVIS. Thank you very much.

Dr. Diamond.

STATEMENT OF CAROL DIAMOND

Dr. DIAMOND. Thank you, Mr. Chairman and other members of

the committee. Thank you for having me here today.

In my role at the Markle Foundation, I chair an initiative called

Connecting for Health which is a unique public/private sector initiative consisting of over 100 organizations who represent all the

stakeholders in healthcare. Over the last few years we have participated in shaping the National drive toward interoperable health information by building broad consensus about a road map of immediate actions and priorities, and most recently by developing a

working prototype of an electronic national health information exchange based on common open standards and policies. Our prototype, which includes the exchange of information both within and

among local communities, is deployed in northern California, Indiana, and Massachusetts.

As this hearing demonstrates, the public and private sector recognition for the need for health information technology has increased dramatically over the last several years, but nothing could

better highlight how far we still need to go than Hurricane

Katrina. As was mentioned earlier, in response to the storm the Office of the National Coordinator, the Markle Foundation, and 150

other public and private organizations worked closely an intense

crash effort to establish an online service for authorized professionals to gain access to prescription records for evacuees.

The medication history information came from a variety of public

and private sources and covered the majority of the evacuees. This

was a marvelous collaborative effort, but the challenge of creating

it had little to do with technology. In truth, the technologies to

move health information between facilities or communities are relatively well understood and operate today within many complex enterprises. Instead, katrinahealth.org came into being because of

good faith commitment to overcome established business, legal, and

policy challenges to information sharing.

If there is any lesson that can be instructive going forward, it is

that a narrow focus on technical aspects of creating an electronic

health information environment will not produce a sustainable, effective network. Longstanding policy, legal, and business obstacles

prevent our personal information from being brought together and

applied to our health needs.

To overcome these obstacles, Government leadership is needed in

three areas: policy, uniformity, and a level of public participation

that maintains focus on the needs of the American people. The policies that govern information access, acceptable uses, consent, privacy, and security must be crafted in parallel with the deployment

of technology if we are to have a trusted and effective health information environment, and the technology choices themselves must

incorporate policy objectives.

The ultimate success of efforts to promote widespread adoption

of health information technology and electronic records will depend

on the confidence and willingness of consumers to accept and use

the technology. However, several studies note significant public

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concerns about the privacy of electronic personal health data, even

when most people acknowledge the benefits.

The policies that establish who has access to health information,

what uses of information are acceptable, the extent to which patients can give or withhold access to their information, and the design of privacy and security safeguards must be crafted in parallel

with the deployment of technology, and the technology choices

themselves must consciously incorporate policy objectives that protect patients.

The second area is uniformity through a common framework. To

the opening remarks on achieving goals for a broad, nationwide

health information network while making good use of the precious,

private and public sector dollars that are invested, we must be dependent on a uniform set of standards and policies that allow all

parties who participate to adopt and participate in information

sharing.

In our work we call this a common framework, and it is based

on a network of networks in which existing healthcare institutions

agree to adhere to a small set of shared rules. This includes technical standards and explicit policies for information use and governance.

The key to this approach is the articulation of these uniform policies and technical standards, and this approach supports a complete diversity of technologies to coexist. Our experience teaches us

that the Nation will need to have an entity to promulgate this common framework, containing both policy and technical standards

that provide structure to our health information environment.

The AHIC recently defined by the Secretary may be the first institutional attempt to provide these functions, and we intend to

work closely with it. The Markle Foundation is now working with

over 30 national consumer groups who are aware of the importance

of health information technology and want to help shape this agenda. The Federal Government and Congress should establish a

meaningful process to address the issues and priorities of the public as the AHIC and other health information technology activities

move forward.

As the AHIC and various Federal agencies begin to set national

priorities for the pace and scope of health information adoption,

they must give attention to the services that produce high value for

individual Americans, particularly technologies that give people

more access to their own information and more control over their

healthcare.

It is not enough to connect healthcare enterprises to each other;

we must also connect people to their doctors, to each other, and to

innovative resources that provide new ways to deliver and improve

health. Personal health records that can connect doctors and other

health system networks may provide the foundation for Americans

to improve the quality and safety of the care they receive, to communicate better with their doctors, to manage their own health,

and take care of loved ones.

Thank you again for inviting me to speak. I look forward to responding to questions.

[The prepared statement of Dr. Diamond follows:]

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Chairman TOM DAVIS. Thank you very much.

Ms. Marchibroda, thank you for being here.

STATEMENT OF JANET MARCHIBRODA

Ms. MARCHIBRODA. Thank you, Chairman Davis, distinguished

members of the committee. I am honored to be here today to testify

before you on the state of information technology, and health information sharing, and the progress and challenges related thereto.

My name is Janet Marchibroda. I am testifying today on behalf

of the eHealth Initiative and its foundation. I service the CEO of

both organizations which are independent, nonprofit, national organizations whose missions are the same, to improve the quality,

safety, and efficiency of healthcare through information and information technology. Both convene multiple stakeholders, both within the private and public sector, to reach agreement on and stimulate the adoption of common principles and strategies for accelerating the use of information to support health and healthcare.

In addition, it is important to note that through EHI, the

eHealth Initiative Foundation, we have built a coalition of almost

1,000 stakeholders in nearly 50 States across the country who are

now mobilizing information to support healthcare.

Despite the recent increase in interest in the use of IT to address

quality, safety, and efficiency issues, current penetration rates continue to be low, particularly in the small physician practices where

a majority of our healthcare is delivered. And it is also important

to note while installing electronic health records can address some

of our healthcare challenges, the real value in terms of improving

quality and safety, saving lives, reducing costs comes from the mobilization of data across systems. You really need that connectivity

to avoid redundant tests, improve safety and coordination, and improve consumer compliance with some of the prevention and disease management guidelines.

Currently, the U.S. healthcare system is highly fragmented and

paper-based, and the clinicians that take care of us don’t have the

information they need to deliver the best care. To address the need

for health information mobilization, a number of collaborative organizations involving all stakeholders in healthcare are emerging

across our country to develop and implement health information

exchange capabilities, and the policies and processes that will support their ongoing operations.

The eHealth Initiative Foundation recently conducted its second

annual survey of State, regional and community-based health information exchange efforts, and we released our results in late August. What the survey results indicated was a dramatic increase in

the level of interest in and activity related to mobilizing information. It showed that there are a lot more of them this year, and

those that are out there are much more mature in terms of organization and governance, getting all the stakeholders to the table,

and the range of functionality provided. Among the 109 health information exchange efforts identified by the survey, there is clear

evidence of rapid maturation and movement with 40 respondents

in the implementation phase and 25 fully operational, up from 9

last year.

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In terms of the barriers to getting to an interoperable healthcare

system, we see two: the first being the misalignment of incentives

and lack of a sustainable business model for IT; and two, the need

for standards adoption and interoperability. Physicians have a real

tough time. They face a significant financial hurdle when exploring

the purchase of an EHR system. What we found in our 2005 survey

was, while these health information exchange initiatives are growing and maturing, the No. 1 key challenge, 84 percent of them actually cited developing a sustainable business model as either

being a very difficult or moderately difficult challenge.

Achieving sustainability for health information exchange efforts

stems in part from fundamental problems with our Nation’s prevailing reimbursement methods which reward the volume of services delivered instead of outcomes or processes that would result in

higher quality care. A lot of progress is being made with the valuebased purchasing legislation that is coming out and the leadership

of the Centers for Medicaid and Medicare Services, as well as

groups such as Bridges to Excellence in the private sector. We have

developed a set of principles and policies bringing together employers, health plans, and practicing clinicians, and these communitybased efforts that will begin to align incentives that we provide in

healthcare, not only with quality and efficiency goals but also with

HIT capabilities within the community.

Great progress is being made around standards and operability,

interoperability, which we have heard from the other parts of our

panel, and a number of efforts are underway with a number of bills

in Congress. Finally, in closing, the Office of Personnel Management through its Federal Employees Health Benefits Program has

an enormous opportunity to affect change in our healthcare system

given that 8 million Federal employees, retirees, and their dependents are reliant on the program. By building into those incentive

programs, policies related to health information exchange, we can

make real progress.

So in conclusion, we offer a very brief summary of key points.

Without the alignment of financial and other incentives, not just

with quality and efficiency but also health information exchange,

efforts to accelerate the mobilization of information will continue to

move at a slow pace, and the combined purchasing power of both

CMS and OPM can make great progress in this area.

Two, innovative programs designed to facilitate both public and

private sector seed funding of these emerging community health information exchange efforts must be developed and implemented, if

our goals around widespread interoperability are to be achieved.

And three, national efforts designed to achieve consensus on standards and promote their adoption could not be more timely, particularly for our communities across America that are on the ground

making this happen.

We are at a unique point in time where we have a lot of momentum moving around these issues. If we focus on moving our quality

and efficiency goals, and at the same time those related to health

information technology, we will make great progress.

Chairman Davis, distinguished members of the committee, thank

you again for inviting me to discuss our perspectives. I hereby request that the Parallel Pathways Framework for Incentives and

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our survey of State, regional, and community-based initiatives that

are referenced in my testimony be made part of the record.

Chairman TOM DAVIS. Without objection.

Ms. MARCHIBRODA. We commend you for your leadership. And,

again, thank you for the opportunity to join you.

[The prepared statement of Ms. Marchibroda follows:]

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Chairman TOM DAVIS. Well, thank you very much.

Ms. Carr.

STATEMENT OF DIANE CARR

Ms. CARR. Good morning, Mr. Chairman and members of the

committee. I would like to thank you for this opportunity to share

the experience of a public hospital in New York City in transforming healthcare with technology.

Queens Health Network is the largest healthcare provider in the

borough of Queens, New York City. We serve a population of about

2 million people. We include two major teaching hospitals, Elmhurst Hospital Center and Queens Hospital Center, and have a

combined total of 771 inpatient beds and see 43,000 annual admissions. We are affiliated with the Mount Sinai School of Medicine

and a member of the New York City Health and Hospitals Corp.

which is the largest municipal healthcare organization in the

United States.

Our service model is unique. I just want to mention that for a

moment because, in addition to providing acute hospital care including tertiary care, we also provide a full range of services of primary care and specialty care services. We serve as many of our patients family doctors. We do that, in addition to our on campus locations in 14 freestanding medical clinics and 6 school-based health

programs where we provide care to children at their school, similar

to what many of us experienced with school nurses. We have a

partnership with community-based physician practice groups, and

we see over 1 million ambulatory visits a year. So we are a pretty

high volume healthcare provider.

I just want to mention about the community we serve because

there is some uniqueness to that as well. It is probably the most

ethnically diverse region in the world. We have immigrants from

over 100 different countries speaking 167 different languages and

87 percent of our patient population is people of color and ethnic

minorities.

Our residents are also some of New York City’s poorest. Sixtyfive percent of the households in our service area have annual incomes under $15,000. Because of this, our patient population is

also medically under-served. They are denied care in other venues

due to inability to pay, and they are generally unaware of preventive practices that promote good health. They present sicker than

the general population.

In the mid 1990’s, Queens Health Network faced a dilemma, how

to maintain and expand services for an ever increasing number of

uninsured patients in an ever more demanding marketplace. As

part of our business and strategic plan, senior administration proposed implementation of an electronic health record to our medical

staff.

In January 1997, we began with computerized physician order

entry. Our doctors started ordering all of their lab and radiology

results and looking them up online. We had no idea at the time

how early we were undertaking this. Today we have a fully integrated, interdisciplinary health record that is used by over 4,300

people every day. This is all of our doctors, our nurses, our pharmacists, social workers, dieticians, lab and radiology techs use the

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system all day, every day, to enter orders, review results, do assessments and plans, histories and physical examinations, and

medical orders.

We provide a full range of electronic decision support to improve

safety and effectiveness of care. So what we have discovered in the

experience of installing our electronic health record is that it is essential to improving patient safety, effectiveness of care and also

in reducing costs.

Chronic disease is the leading cause of illness, disability, and

death in the United States today. Nearly half of the population,

100 million Americans, have one or more chronic medical conditions. The costs of the treatment is enormous in accounting for

nearly 70 percent of all personal healthcare expenditures in the

country. The electronic health record can provide a structure for

applying evidence to patient care to improve care of patients with

chronic diseases.

So we have targeted heart failure, diabetes, and depression right

now as populations of patients who can benefit from analysis and

aggregation of data, which helps us to evaluate therapies and

treatments on patient outcomes. For example, if we have cardiologists working in adjoining rooms with patients with the same disease, we may not know what is going on with them individually,

but when we start to aggregate their data we can look at patterns

and see rooms for improvements.

The final point that I want to make is that, with all the discussion of interoperability, I think you also have to start somewhere

and that the electronic health record is the place that will provide

a starting point. If you don’t have electronic health record that you

can share your patient information from, interoperability means

nothing, that is it.

Chairman TOM DAVIS. OK. You have concluded?

Ms. CARR. Yes.

[The prepared statement of Ms. Carr follows:]

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Chairman TOM DAVIS. Mr. Blue, go ahead. We have a vote, but

if we can hurry this up, we can get some questions in.

Mr. BLUE. I will try and speak as quickly as I can, Mr. Chairman.

Chairman TOM DAVIS. Then we can go. Otherwise, we have to

come back.

STATEMENT OF LARRY BLUE

Mr. BLUE. Mr. Chairman Davis and distinguished members of

the committee, thank you very much for the opportunity to testify

today and for holding this very important hearing on how we can

use information technology to improve the quality of healthcare in

this country. I would like to focus my remarks today on two specific

areas, reducing medical areas and using RFID to fight the rising

tide of counterfeit drugs.

First, let me tell you a little bit about Symbol Technologies. Symbol manufactures handheld computers that scan bar codes and read

RFID tags. We also manufacture wireless networks that tie together large scale asset management systems, so information is

available where it is needed in real time. We help our clients capture, move, and manage information. Today these tools are being

used to dramatically improve the delivery of healthcare by making

medical information where and when it is needed, at a patient’s

bedside, in an operating room, or on a battlefield.

Medical errors are a serious problem facing the healthcare industry today. The Institute of Medicine estimates that preventable

deaths due to medical errors are between 44,000 and 98,000 annually, and adverse drug events cause more than 770,000 injuries per

year.

With aging parents and as a father of three great kids, I was

pleased to see that reducing medical errors is one of the central

goals of the national healthcare strategy. In our view, the keys to

reducing medical errors are: first, converting patient records from

paper to electronic records as presented in Dr. Brailer’s earlier testimony and by other testimony today; and second, delivering accurate information to the patient’s bedside in right time.

Once a medical center adopts electronic patient records, the next

step is to adopt mobility technology so that information is available

at a doctor’s or nurse’s fingertips anywhere in the complex. Patients move from hospital rooms to radiology centers to operating

rooms in the normal course of their treatment, and their information has to follow them.

Some hospitals now assign a barcode to a patient when he or she

checks in. It is put right on their wristband. When a nurse is making rounds and stops in a patient’s room, he or she can scan the

barcode on the patient’s wrist with a handheld computer similar to

the PDA many of you carry today. The handheld then wirelessly

retrieves the patient’s medical records and displays the last times

medicines were delivered, when the next dose is due, and exactly

how much of which medicines to administer. The nurse can deliver

the right medicines in the right doses at the right time, and immediately update the patient’s record electronically.

One real life example of this system in action can be seen at the

VA. The Veterans Administration deserves an enormous amount of

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credit for implementing this type of patient identification and

health information mobility system and improving patient care as

a result. A hundred percent of VA medical centers are currently

using barcode technology to identify patients and medication, and

medication errors have been reduced significantly. Unfortunately,

the adoption of these important solutions in commercial hospitals

is estimated at less than 20 percent.

One of the most significant barriers to hospitals implementing

this type of system has been the lack of a uniform barcode on medications. Up until now, healthcare providers have had to develop

their own barcodes and apply them to drug packages which is costly, can be error prone, and is time consuming.

We applaud the FDA’s new regulations requiring barcodes on all

medications by April 2006. This should make these systems much

easier to implement and will enable more effective information exchange within and between facilities during patient transport,

treatment, and transfer.

The second topic of my remarks relates to the serious problem

of counterfeit prescription drugs. This affects not only patients here

in the United States but around the world. The World Health Organization estimates that prescription drug counterfeiting is a $32

billion global business.

New technologies are being employed to combat counterfeit

drugs, and one of them is RFID. RFID stands for Radio Frequency

Identification. It is the next generation of barcode. A tiny computer

chip attached to an antenna is placed on a product. When it is activated by a reader, it transmits a serial number or unique identifier

to an authorized device. That number is then used to retrieve information such as an EHR from a secured data base.

The FDA and private industry are aggressively developing electronic track and trace systems using RFID to stop counterfeiting.

The goal of these systems is to create an electronic pedigree for legitimate drugs. Symbol is actively working with Perdue Pharmaceuticals to develop such a system for Oxycontin which is one of the

top counterfeited and stolen medications in the United States.

Early results of our trials are encouraging, and we are optimistic

that this RFID-based system is going to create a real barrier to

thieves and black marketeers.

For health IT systems and technologies to be effective, they have

to be interoperable; and to be interoperable, we need industry-wide

standards. Without standards, data from one company or medical

center won’t be understood at another, and one company’s RFID

readers won’t read another company’s tags, and so on.

In my industry, I have personally worked to develop standards

for RFID and electronic product codes. A group called EPC Global

has done a great job getting industry together to create a common

RFID data standard. I believe standardization is critical to widespread implementation and unlocking the value of a new technology. In this case standards can mean the difference between

only one hospital having an electronic patient record and the ability of that hospital to freely share that record with any other

healthcare provider needed by that patient.

As the economy has become global, it is now more important

than ever for these data exchange standards to be global. Health

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care products consumed in the United States are manufactured

globally, and global standards is one area where Congress and the

administration can help us. If the Federal Government can reinforce the message to industry in foreign countries that cooperation

on common barcodes, EHRs, and other data exchange standards

like RFID is a high priority, that would be very helpful.

Thank you again for the opportunity to testify today, and I would

be happy to answer any questions you have.

[The prepared statement of Mr. Blue follows:]

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Chairman TOM DAVIS. Thank you very much. Let me start. Mr.

Powner, as you know from our FISMA score card, you know this

committee likes grades. Can you try to give the administration a

grade in its efforts to develop a national strategy for health IT including its efforts to define and implement standards?

Mr. POWNER. From a leadership and vision perspective, clearly,

Dr. Brailer and the efforts at HHS and the administration deserve

an A. If you look beyond that in terms of putting in place plans

and getting down to the implementation, we are incomplete. We

are far from having plans and marching orders in place and a complete game plan to tackle this enormous challenge.

Chairman TOM DAVIS. Thank you very much.

Ms. Carr, how long did it take to fully implement electronic

health records in the Queens Health Network?

Ms. CARR. Mr. Chairman, in 6 months we went from a twinkle

in our eye to having our physicians doing order entry online.

Chairman TOM DAVIS. How did you get the buy-in from physicians?

Ms. CARR. I guess what we did is we had a really serious challenge in terms of the volume of activity that we needed to support.

And we demonstrated that with this technology, we could increase

our capacity and take better care of our patients.

Chairman TOM DAVIS. Thank you.

Mr. Blue, do you think that health IT systems are more vulnerable and more attractive to hackers and cyber attack because of the

quantity of personal information they hold?

Mr. BLUE. My own personal opinion, Mr. Chairman, is no, I do

not believe so. I believe that they are vulnerable to attack like all

data bases, but there is a lot of work that has been done both in

industry and in Government to assure through opportunities like

HIPAA, and I believe one of the prior testimonies discussed the advantage of information technology in protecting that data and also

making it more readily available to the people that need it. So I

don’t believe so.

Chairman TOM DAVIS. Dr. Diamond, your testimony mentions

the problem of patients being concerned that a system of electronic

health records could result in the exposure of private health information, which I just asked Mr. Blue a question about. How are you

working to manage public perception that privacy could be compromised?

Dr. DIAMOND. Yes. Yes, I think——

Chairman TOM DAVIS. Because we see the credit card companies

and everything else on these things.

Dr. DIAMOND. You took the words out of my mouth. I was just

going to say, Mr. Chairman, that I think we have all seen the

newspaper stories about credit card data being stolen, and other

third party data bases being hacked, and consumers’ identity being

stolen. I am of the belief that this is a broad IT sector issue that

needs to be solved.

But I think for healthcare, in particular, our approach is to build

the need to protect privacy and security in on the front end of this

technology and architecture. And one of the models we propose, the

model we propose to do that is to separate the medical data, the

location of the medical data from the actual data itself, so that we

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are not proposing putting everyone’s information in one large central data base, but just having the network and the infrastructure

available to know where it is when it is needed, and not have to

put it in one place which is a single point of attack or a hacker’s

dream potentially.

Chairman TOM DAVIS. Thank you.

Ms. Marchibroda, are State and local health IT initiatives coordinated with Federal strategy?

Ms. MARCHIBRODA. Thank you, Chairman. They would like to be.

I think something that EHI is doing right now is taking the national standards and policies that are merging from the Federal

Government as well as initiatives like Connecting for Health, and

creating tool kits and guides to help these States and regions who

very much want to be in sync with national principles and standards, provide them with guides to help them get there.

Chairman TOM DAVIS. OK.

Ms. MARCHIBRODA. There is still more work to do.

Chairman TOM DAVIS. I will ask anybody: What metrics would

you use to gauge the success of the National Coordinator’s Office?

Anybody want to take a shot at that? Any volunteers? Go ahead,

Mr. Powner.

Mr. POWNER. Ultimately, I think—Mr. Blue mentioned this—I

think one of the key metrics we really need to focus on long term

here is the reduction of medical errors. When you look at the staggering figures that come out associated with medical errors, the

number of people who actually die in a given year, that is clearly

a metric where the incorporation of health IT can clearly move us

in the right direction.

Chairman TOM DAVIS. Thank you. We have about 3 minutes left

in our vote. I could hold you over for a couple votes, but I think

what I will do is just adjourn the hearing at this point.

We may have some questions for the record from each of you, but

we appreciate your statements. It is all in the record and will all

be used as we move ahead. I thank you for your time. The meeting

is adjourned.

[Whereupon, at 12:03 p.m., the committee was adjourned.]

[The prepared statements of Hon. Dennis J. Kucinich and Hon.

John M. McHugh, and additional information submitted for the

hearing record follow:]

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