Strategic planning for Healthcare IT

Healthcare Financial Management, Jan, 2005

Lesson 3. In Glaser's experience, people are overly optimistic about IT planning. "They presume nothing will go wrong, they presume they are in full control of all the variables, they presume they have full time to give to this initiative, and they presume that they have total clarity about what has to be done. So they have four foundations for their optimism and at least one of them is not warranted." To be safe, says Glaser, assume that either the cost estimate or the time estimate is too low or the estimated degree of gain is too high--or all three.

Lesson 4. To further guard against unwarranted optimism, Glaser recommends exposing your thinking to the critical eyes of people from the outside--consultants or colleagues from peer organizations--who don't have an ax to grind. "They'll be honest with you; they'll say, 'Are you nuts?'"

Lesson 5. You need not only an executive sponsor to propose an IT initiative, but also "enough sustained sponsorship in the organization to make it happen," cautions Massachusetts General's Noga. He speaks from "costly" experience, when the hospital tried to put in a comprehensive referral management system. "We put together the technology component but couldn't get the cooperation of the physician practices." Six years later, the environment had changed. "There was a willingness to invest the resources and attention needed. But that meant that we actually uninstalled and reinstalled the same system."

Lesson 6. Jim Adams has run into integrated delivery networks that have allowed their constituent hospitals a fairly high degree of autonomy in the systems they select or the way they implement them. They may have multiple versions of the same piece of software, making it hard to exchange data. "Now they realize they need to have more standardization in the way they practice medicine across the organization--in the way the work flows, for example, or the way the screens look. This might mean they have to go back and rethink and re-implement some systems, and that can be a major effort."

Lesson 7. Sometimes, says Glaser, an organization has an excellent IT strategic plan but forgets to monitor it. "They let execution wander off and get in trouble. You need a quarterly review of the agenda to make sure it's working as you thought it would. Because invariably there are bumps and problems that arise and you want to get to those early and take care of them. Otherwise, you can turn around a year from now and say, 'What happened?' Nothing happened--they got stuck nine months ago."

Figure 1: Readiness Assessment: Physician Readiness

Characteristic                                                    Score

* A sub-set of physicians can describe the "value-add" of CIS
and its impact on their ability to care for patients

* Physician leadership demonstrates willingness to spearhead
CIS activities, provide guidance and act as champions

* The hospital has historically deployed other physician lead
initiatives in quality improvement and outcomes management,
patient safety, new physician roles, etc. and these initiatives
have been viewed as successes

* Competitors are successfully deploying CIS and other new
technologies. Significant competitor activity may impact market
growth or recruitment/retention

* Current use of technology within clinical practices

* A sub-set of physicians can articulate features and functions
that are desirable in a CIS

* Physicians are generally supportive of Administration lead
initiatives

Source: * Maestro Strategies, LLC. Used with permission

As with the other elements of the readiness assessment that Pam
Arlotto, president and CEO of Maestro Strategies, LLC, in Roswell,
Ga., uses, individual elements of physician readiness are scored
using a traffic light approach: Green means "ready to proceed,"
yellow means "some risk: additional preparation needed," and red
means "high risk: significant preparation is necessary."

Figure 3: Examples of Data Metrics by Category

                 Primary
Category         Indication                 Examples

Financial        Indicate positive ROI.     * Budgeted vs. Actual Costs
Indicators                                  * Return On Investment
                                            * Consolidation of
                                              duplicate functions
                                            * Reduced length of stay
                                            * Reduced supply costs
                                            * Reduction of days in
                                              accounts receivable
                                            * Revenue enhancement
                                              (increased throughput,
                                              improved charge capture)

Productivity     Indicate                   * OR turnover time
indicators       efficiency/effectiveness   * Lab requisitions
                 in workflow and              processed per HE
                 operations that            * Rejected claims as % of
                 translate into cost          total claims
                 reductions or              * Callbacks related to
                 increased throughputs.       medications order
                                              clarification
                                            * Reduction of chart pulls
                                            * Improved turn-around and
                                              wait times

Clinical         Indicate desired health    * Reduction of unnecessary
quality          outcomes as                  and/or redundant orders
indicators       determined by current      * Reduction of adverse drug
                 professional                 events (ADEs)
                 knowledge.                 * % of practice pts.
                                              [greater than or equal
                                              to] 65 who received flu
                                              vaccine
                                            * % of pts. with documented
                                              discharge teaching
                                            * Mammography screening, %
                                              of target pt. population
                                            * Capability to monitor
                                              care map compliance/
                                              deviation
                                            * Reduction of nosocomial
                                              infection

User             Indicate the degree to     * Accessibility of visit
satisfaction     which user/customer          notes (provider)
                 needs are met by the       * Promptness of lab
                 technology.                  results/interpretation
                                              (provider)
                                            * "Would you return/
                                              recommend to others?"
                                              (patient)
                                            * Mammography screening,
                                              result communicated to
                                              pt. within 24 hours
                                              (patient)
                                            * Capability of single
                                              sign-on and ubiquitous
                                              record availability

Risk             Indicate the degree to     * Claims transaction is
reduction        which technology has         HIPAA compliant
                 reduced risk/enabled       * Disaster notification
                 regulatory compliance        plan meets JCAHO
                 (litigation avoidance,       regulations
                 regulatory                 * Mammography screening
                 compliance)                  (litigation avoidance)
                                            * Reduction in malpractice
                                              premiums
                                            * Decreased HCFA fines for
                                              readmission
                                            * Decreased number of "over
                                              48 hour observation"
                                              patients

Infrastructure   Indicate the degree to     * Network availability
                 which technology           * Application performance
                 sustains/enhances          * Email accessibility
                 information flow.          * Remote access to clinical
                 (reliability,                applications
                 availability)

Figure 4: Prioritization Criteria or Value / Risk Assessment

Value Statement (scoring guidelines)          Relative  1 2 3 4 5 Score
                                               Weight

QUALITY OF PATIENT CARE / PATIENT SAFETY
1 = significantly improved,
5 = minor improvement

REVENUE IMPACT
1 = 0-50K, 2 = 50K-100K, 3 = 100K-500K,
4 = 500K-1M, 5=>1M

COST REDUCTION
1 = 0-50K, 2 = 50K-100K, 3 = 100K-500K,
4 = 500K-1M, 5=>1M

PATIENT / CUSTOMER SATISFACTION
1 = significantly improved,
5 = minor improvement

QUALITY OF WORKLIFE / EMPLOYEE SATISFACTION
1 = significantly improved....
5 = minor improvement

SYSTEM INTEGRATION
1 = one entity, 2 = two entities,
3 = three entities, 4 = four entities,
5 = > five entities

REGULATORY / COMPLIANCE
1 = fully compliant ...
5 = At risk of legal action or
financial penalty

POTENTIAL LEARNING VALUE
1 : significant value ...
5 = minimal value

                                       Total   100

Risk Assessment                               Relative  1 2 3 4 5 Score
                                               Weight

Sponsorship--value of project is understood
and supported
1 = strong support ... 5 = nominal support

Degree of change for organization to undertake
1 = minor change ... 5 = significant change

Economic risk that project may not produce
expected benefits due to future economic or
regulatory climate
1 = little risk ... 5 = considerable risk

Business risk related to services, markets, or
competitors that may impact degree of success
of project
1 = little risk ... 5 = considerable risk

Existing documentation and procedures of
business processes
1 = well documented ... 5 = no documentation

Availability and usage of proposed development
technology
1 = technology heavily used ... 5 = new technology

Number of departments involved
1 = 1 ... 5 = >5

Technology risks due to technology/systems failing
to meet expected service benefits
1 = little risk ... 5 = considerable risk

Number of other projects which this project is
dependent on
1 = 0 ... 5 = >3

Total estimated duration of the project
1 = < 6 months ... 5 = > 24 months

Complexity of business rules, ability to automate
1 = simple ... 5 = complex

Consistency and alignment with technical
architecture standards
1 = no alignment ... 5 = full alignment

                                        Total  100

The IT Steering Committee

In addition to rounding up the usual suspects-that is, the CEO, COO, CFO, CIO, CMO and the rest of the C-suite-consider top representatives from these areas, as appropriate: