Healthcare // Analytics
Commentary
8/14/2013
04:22 PM
Rob Preston
Rob Preston
Commentary
Connect Directly
LinkedIn
Twitter
RSS
E-Mail
50%
50%

Death By A Million Regulations

It is long past time to assess the consequences of the endless laws, codes, rules, licenses and guidelines governing just about every human activity.

Six healthcare industry IT executives recently sat down with InformationWeek editors to discuss a range of issues, from remote patient monitoring to electronic health records to population health management to clinical decision support. But when we started the conversation by asking about "the things that are dominating your agendas," we got an earful on a subject we weren't quite expecting.

"Regulatory. It's just a waste of our time doing ICD-10," said Larry Garber, Reliant Medical Group's medical director for informatics, referring to the new, more detailed set of codes the feds require to report medical diagnoses and procedures. Garber noted that complying with some federal regulations, such as "meaningful use" of electronic health records, is worth the effort. But complying with ICD-10 amounts to busy work. "So unrewarding," Garber said.

Before he could say another discouraging word, Beth Israel Deaconess Medical Center CIO John Halamka chimed in: "So much of my innovation has almost ground to a halt because so much of my staff is dealing with the must-dos from state and federal regulators, much of which is nonsensical and not value-added."

Halamka cited BIDMC's $5.3 million settlement on July 29 with the Department of Health and Human Services' Office of Inspector General (OIG), addressing government allegations that the Harvard teaching hospital had overcharged Medicare by admitting patients between 2004 and 2008 who should have been treated less expensively as outpatients. The Boston Globe reported that BIDMC didn't admit wrongdoing as part of the settlement, "which both sides described as a way to avoid costly legal action."

"It's basically about how you describe an inpatient versus an outpatient observation stay," Halamka told us. He described the issue as "so deeply technical" that it took his IT staff six months to implement the logic needed to comply with the complex regulations. "It's utterly esoteric. But the OIG has decided that it's a priority. This is what we're dealing with every day."

Global CIO
Global CIOs: A Site Just For You
Visit InformationWeek's Global CIO -- our online community and information resource for CIOs operating in the global economy.

Forrester Research estimates that companies spend about 1.75% of their IT budgets on risk and compliance management software. But spending estimates go much higher, to as much as 10% of IT budgets, when factoring in security, storage, archiving, content management, e-discovery, disaster recovery and other compliance-related investments. Halamka and Garber suggest it's eating up far more of their organizations' time and creative energy. And when InformationWeek recently asked healthcare IT pros in a survey to rank their top priorities, an astounding 61% put "meet regulatory requirements" as a "top priority" -- 5 on a 5-point scale. Just 47% of respondents ranked "improve care" that highly.

These aren't rabid capitalists just looking to make a quick buck. In the case of Halamka and Garber, they're world-class technologists and highly respected doctors -- Dr. Halamka is a practicing emergency physician and Dr. Garber is an internist. They say they can't find enough time to do what they were hired to do (innovate) and what their colleagues and patient-customers depend on them to do (elevate the level of care) because they and their people are spending much of their 12-hour days dotting i's and crossing t's.

The Best Intentions

Almost all proposed rules and regulations sound reasonable, even virtuous. They're crammed with the best intentions. A patients' bill of rights here. A privacy-protection law or two there.

Previous
1 of 2
Next
Comment  | 
Print  | 
More Insights
Comments
Threaded  |  Newest First  |  Oldest First
RobPreston
50%
50%
RobPreston,
User Rank: Author
8/15/2013 | 2:50:55 PM
re: Death By A Million Regulations
Got a regulation or two you'd like to see killed? We'd like to hear about it here.
Thomas Claburn
50%
50%
Thomas Claburn,
User Rank: Author
8/15/2013 | 8:17:09 PM
re: Death By A Million Regulations
The entire tax code needs to be revised. Ideally, it should fit into 140 characters. Here's 33: All income shall be taxed at 15%.
RobPreston
50%
50%
RobPreston,
User Rank: Author
8/16/2013 | 1:08:56 PM
re: Death By A Million Regulations
Where's the Like button on Comments?
majenkins
50%
50%
majenkins,
User Rank: Ninja
8/16/2013 | 3:59:15 PM
re: Death By A Million Regulations
The little up and down arrow head thingies.
NJ Mike
50%
50%
NJ Mike,
User Rank: Strategist
8/19/2013 | 12:02:39 PM
re: Death By A Million Regulations
Hey, there should be a regulation specifying requirements for "Like" buttons, so whatever website or forum you're reading, you can easily identify the "Like" button". Oh, and there should be a requirement for a "Not Like" button.
Shane M. O'Neill
50%
50%
Shane M. O'Neill,
User Rank: Author
8/15/2013 | 5:33:07 PM
re: Death By A Million Regulations
Mortgage regulations are horrible. I could not refinance for the rate I wanted and QUALIFIED FOR because of a Fannie Mae/Freddie Mac regulation that does not apply to my condo building at all yet has to be enforced. It was a year ago and I'm still angry.
mjensen810
50%
50%
mjensen810,
User Rank: Apprentice
8/15/2013 | 7:06:56 PM
re: Death By A Million Regulations
Thank Dodd-Frank and the Consumer Finance Protection Bureau. It is protecting consumers by making it nearly impossible for them to get a mortgage!
Shane M. O'Neill
50%
50%
Shane M. O'Neill,
User Rank: Author
8/15/2013 | 7:15:13 PM
re: Death By A Million Regulations
I understand we needed rigid oversight after the subprime meltdown. But these regulations are so inflexible. I was eventually able to refinance with a local bank that keeps the loan in-house (hence can bypass Fannie-Freddie rules). But I didn't get close to the rate of a traditional loan.
mjensen810
50%
50%
mjensen810,
User Rank: Apprentice
8/15/2013 | 5:59:23 PM
re: Death By A Million Regulations
And if you think it is bad in the medical profession, try banking!
MyW0r1d
50%
50%
MyW0r1d,
User Rank: Strategist
8/15/2013 | 6:54:19 PM
re: Death By A Million Regulations
It is difficult to defend senseless government involvement and often contradictory regulations, however, ...
As long as there is a never ending stream of Dr. Fata's (allegedly prescribed chemo to patients without cancer) or Conrad Murray's or Bernie Madoff's or Lehman Brothers or the JP Morgan $2 billion loss on "egregious mistakes" as described by Bloomberg Press, just to name a few, I feel little pity for regulation and oversight. These industries have only theirselves to thank for the situation.
mjensen810
50%
50%
mjensen810,
User Rank: Apprentice
8/15/2013 | 8:05:54 PM
re: Death By A Million Regulations
Unfortunately, the innocent get pilloried along with the guilty. As a small country bank, we certainly did nothing to contribute to the melt down or any of that, yet we get to adhere to the same regulations as the big boys.
Michael Endler
50%
50%
Michael Endler,
User Rank: Author
8/17/2013 | 5:57:51 AM
re: Death By A Million Regulations
I sympathize with this point of view. Many regulations are, as Rob effectively illustrated, a quagmire of jurisdictional questions, redundancy, and overall b.s. But there's a problem: some companies look for any absence of regulation they can exploit.

It's almost like some companies know laws will be written later to outlaw their activities, so they figure they have to maximize their bad behavior while it's still legal. It's that gray area where "ethical" and "legal" start to separate from one another. The garbage with Goldman Sachs trying to affect aluminum prices is a recent example of this sort of thinking.

And when the companies get punished, the fines are never enough to appease public disapproval. If you make the mistake of parking in the wrong space in San Francisco and your car gets towed, the penalty you'll pay to get your car back is more severe, in relative terms, than what many fines related to the financial crisis have been. It's no wonder people have, as Rob pointed out, a natural affinity for more rules, more regulation and - so they hope - more protection. When companies so often do things that make people think, "Someone should stop that!", calls for more regulation are difficult to avoid.
pwndecaf
50%
50%
pwndecaf,
User Rank: Apprentice
8/19/2013 | 6:30:03 PM
re: Death By A Million Regulations
Try this - speculative financial banking vs commercial banking. Good enough!
Stay away from my money if you are the former.
rjones2818
50%
50%
rjones2818,
User Rank: Strategist
8/15/2013 | 7:48:29 PM
re: Death By A Million Regulations
And who gets to decide if a regulation is out of date, etc.?
RobPreston
50%
50%
RobPreston,
User Rank: Author
8/15/2013 | 8:12:45 PM
re: Death By A Million Regulations
Ah, excellent question. A committee of the good and great? I was half joking.
ANON1246385228451
50%
50%
ANON1246385228451,
User Rank: Apprentice
8/17/2013 | 3:09:07 PM
re: Death By A Million Regulations
Great idea! The Department of Regulatory Regulation! A new cabinet post.
KBurger
50%
50%
KBurger,
User Rank: Apprentice
8/15/2013 | 8:47:33 PM
re: Death By A Million Regulations
I have mixed feelings about this. Rob, you are right on about the inefficiencies and costs due to redundant and overlapping regulations (no different from redundant/overlapping systems that incur from mergers, growth, etc.). And it's very true that IT often (usually) bears the brunt of compliance requirements, especially when it comes to providing reports, analysis, audits, etc. But I also think a tremendous amount of time is wasted complaining about and fighting regulations such as Dodd-Frank. No one likes to be regulated, but I see a growing number of organizations just dealing with it and moving on. Ideally, the investments made in compliance can be leveraged for better risk management, customer insight and competitive intelligence. I know that's an elusive goal but it's possible. One final note -- for all the complaints about the Affordable Care Act, one group you're not hearing much from is insurance companies. Although they will be dealing with restrictions, scrutiny, etc., they also have the potential to gain new customers. So regulation can cut (so to speak) both ways.
MyW0r1d
50%
50%
MyW0r1d,
User Rank: Strategist
8/16/2013 | 2:55:33 PM
re: Death By A Million Regulations
Insurance companies! Are you kidding? Where they fought tooth and nail to keep subscribers and sell them every conceivable add-on as they tried to reduce the costs, the government now obliges a practically 100% participation. There is a word for it - windfall - any complaint in light of the benefits would be lame. A positive side effect, long term unemployed could consider a career change and start to study now to enter a possibly expanding market to deal with the increase of business.
cbabcock
50%
50%
cbabcock,
User Rank: Strategist
8/16/2013 | 5:56:15 AM
re: Death By A Million Regulations
When it comes to mortgage industry regulation, we could say not too long ago, What regulation? Many parties saw that it was running amuck but there was no countervailing force to pull up short its bad practices. Too many rules, forms and blind policies? Yes. But regulation? Not in the 200r5-2008 time frame.
UberGoober
50%
50%
UberGoober,
User Rank: Strategist
8/19/2013 | 5:24:30 PM
re: Death By A Million Regulations
Historical revisionism will get you nowhere but the podium at the Democrat convention. For the record, the regulations requiring loans to folks who had no real chance or repaying them, plus the implict (and actualized) gubmint backing of Fannie and Freddie are primarily what got us into the mess. The temptation to make a bad loan and sell it to government backed suckers was high, and a lot of folks took 'em up on it.

That and the stupidly long period of very low interest rates that led to the housing bubble; of course, Bernanke is too smart to do that again... NOT.
pwndecaf
50%
50%
pwndecaf,
User Rank: Apprentice
8/19/2013 | 6:36:30 PM
re: Death By A Million Regulations
And who made the stupid loans that would not be paid back? It wasn't the government and the people that bailed out their sorry a$$es. Fannie/Freddie are private enterprises, which the government has no business sponsoring (GSE).
kkinnison
50%
50%
kkinnison,
User Rank: Apprentice
8/27/2013 | 12:12:17 PM
re: Death By A Million Regulations
If you seriously believe that the entire economy collapsed because a few people couldn't pay back their loans you need to look harder at what happened. There is always a percentage of loans that was expected to fail, only a relative tiny amount of extra failures started the snowball.- And if those HAD been under the fannie/freddie umbrella we wouldn't have had an issue.
sjacks982
50%
50%
sjacks982,
User Rank: Apprentice
8/17/2013 | 11:25:17 AM
re: Death By A Million Regulations
When I hear "too much regulation" I hear "oink, oink". Wasn't SOX an outgrowth of Enron? Didn't email retention rules tighten up after Microsoft tried to con the DOJ? At the turn of the century, UofW Medical Center settled for $10 million (potentially ~$50 million) on overcharges for misrepresenting the care provided (e.g. charging for "ghost" staff), and recently caught again trying to defraud the Government. Private insurance investigates and settles numerous of these cases outside the public eye. Regarding onerous report requirements: outside private insurers and insurer/hospital companies internally (like the Blues) require more detail than the Fed agencies. I would wager your guests were either grossly incompetent CIOs or you don't recognize thinly disguised greed. (And the AMA protects negligent doctors better than the Catholic church covers up for priests.)

These are the same arguments given by Bank IT execs, yet any nearly intelligent human being (sorry, but accountants aren't known for high IQ) could guess that their practices were against the law.
Oh and the statistical chance of your going home from surgery with an errant surgical instrument sewn up inside you hasn't changed from two decades ago. Incompetence: one hospital's charging Medicare for the missing instruments was key to one investigation.
kallinghamk2l
50%
50%
kallinghamk2l,
User Rank: Apprentice
8/19/2013 | 4:10:44 PM
re: Death By A Million Regulations
Come on. Regulations exists for one reason and one reason only. Bad past behavior by corporations not caring about the welfare of workers, the public, and other annoying profit sink-holes like that...
RobPreston
50%
50%
RobPreston,
User Rank: Author
8/19/2013 | 6:37:41 PM
re: Death By A Million Regulations
If we're just out to stick it to the "annoying profit sink-holes," let's not take down the good with the bad. As mjensen810 states above, "the innocent get pilloried along with the guilty." Let's crack down on the bad actors, not everyone in a given industry.
UberGoober
50%
50%
UberGoober,
User Rank: Strategist
8/19/2013 | 5:57:12 PM
re: Death By A Million Regulations
The first thing I'd suggest is a Constitutional amendment to limit all laws to 20 pages. If you've got a lot to do, write a lot of laws that an ordinary person can understand. There's never been or will be a 1000 page law that does what it should (cf: Dodd-Frank, ACA, etc).
RobPreston
50%
50%
RobPreston,
User Rank: Author
8/22/2013 | 9:53:16 PM
re: Death By A Million Regulations
Perhaps there's hope. Some food for thought on WSJ.com (subscribers only): http://online.wsj.com/article/...
Big Love for Big Data? The Remedy for Healthcare Quality Improvements
Big Love for Big Data? The Remedy for Healthcare Quality Improvements
Healthcare data is nothing new, but yet, why do healthcare improvements from quantifiable data seem almost rare today? Healthcare administrators have a wealth of data accessible to them but aren't sure how much of that data is usable or even correct.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Tech Digest - September 10, 2014
A high-scale relational database? NoSQL database? Hadoop? Event-processing technology? When it comes to big data, one size doesn't fit all. Here's how to decide.
Flash Poll
Video
Slideshows
Twitter Feed
InformationWeek Radio
Archived InformationWeek Radio
A look at the top stories from InformationWeek.com for the week of September 7, 2014.
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.