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Defining The Business Value Of Technology
September 27, 1999
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Technology Soothes Pain Of Cost-Cutting
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By Richard Adhikari
ealth-care providers are battling to cope with the tremendous changes sweeping through their industry. Federal payments to health-care providers and insurers are down, while demands for reporting are up; year 2000 remediation is gobbling up scarce resources; and companies need to keep costs down while maintaining service levels and a competitive edge. On top of those problems, companies are constantly seeking ways to draw new customers and cope with competition.
Yet providers face different problems, and not all members of the industry face the same challenges. "There's a tremendous dichotomy in this industry," says Daniel Nutkis, founder and director of research at the Odin Group in Nashville, Tenn., which provides consulting services to the top 40 companies in the health-care industry. However, there's a common thread linking the more forward-looking organizations: They're using technology creatively to resolve problems.
Everyone in the industry has to deal with the federal government. Washington's approval of the Balanced Budget Act of 1998 means it will pay providers less money for treatment under a new reimbursement model, but providers will have to file online reports five times a month, on time, to get proper reimbursement.
Also, the new reimbursement model, which used to apply only to inpatients, is being extended to long-term-care patients and outpatients under the Outpatient Prospective Payment System next year. Meanwhile, Washington wants providers to provide better patient care.
"Filing these electronic data sets five times a month from every facility is a huge burden for us," says Katheryn Markham, VP of IS planning and architecture at Vencor Inc. in Louisville, Ky. Vencor is a $3 billion long-term health-care provider that operates more than 290 nursing centers and 60 long-term care hospitals, and provides contract ancillary services nationwide. Its nursing centers, which Markham says are run lean and mean, were hit hardest by the new federal mandates. "Staffing is tight, and the nurses are very busy doing patient care," she says. "So we had to implement a system that would let them collect the data most accurately and file it electronically on time."
With input from clinicians, Vencor wrote an editing tool in Visual Basic that pulls in existing data on patients from registration records and merges it with information on patients' conditions, which is keyed in manually.
"We don't want them to re-enter information that already exists electronically," Markham says. The editor includes range-checking features that confirm whether manually keyed-in information is valid. It also has cross-checking features. "If we say this patient needs help in getting dressed in answer to one question and say he can brush his own teeth in answer to another question, that raises a flag, and the staff must check the answers," she says.
Vencor implemented its prospective payment system in July 1998, whereas most of the rest of the industry began implementing it this past January, she adds.
Y2K Support
As with most other industries, the year 2000 problem has occupied the bulk of time, energy, and effort in the health-care industry. Some companies have replaced hardware and software assets to make them Y2K compliant, but Columbia Information Systems in Nashville, Tenn., the IS division of Columbia/HCA Healthcare Corp., has taken this one step further: It developed its own intranet application to support Y2K activities in a bid to control the costs of the exercise.
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