The blogs we like to share at PointClear are primarily intended to communicate topics we find interesting and think you may as well. The content and themes are usually about innovation (technology, user experience, business models, funding) in healthcare. With the type of work that we do with our clients, we are often on the cutting edge of designing and developing new products and/or digital solutions. As a result, we have a feel for where the technology, innovation and change hockey pucks are going in healthcare.
Several years ago, I penned a blog on this very topic – channeling my best Nostradamus by making a prediction or two. Specifically, I was interested in What’s after the Meaningful Use Hangover?
My thesis at the time was that, although the federal government’s Meaningful Use (MU) incentive program was the driving force for healthcare IT adoption, primarily focused on Electronic Health Records (EHRs), it could be argued that it may wet the appetite of healthcare provider organizations for more and more technology, where historically healthcare as an industry has traditionally been a technology laggard. So, my question was “how will the industry respond once the hangover of the meaningful use forced march is over? And to further drill down, “will the industry be fatigued and resistant to more technology and change, or will it clamor for more”? You can read an article I penned for Healthcare IT News on this as well.
Now that we are a full 4 years down the road from asking that question, and about a year after essentially the final phase of MU in 2017, just how did the vast implementation of EHR technology impact providers and subsequent broader adoption of other technologies?
To answer this core question, it would be helpful to get answers to these more detailed questions:
–How many doctors were using EHRs before the legislation (ARRA & HITECH Acts) was passed in 2009 that ushered in what we call the Meaningful Use era vs how many docs are using them today? From most accounts the adoption rate was dramatic. The ONC claims EHR adoption more than doubled from 2008 to 2015. EHR vendor, Practice Fusion, asserts, “Less than a decade ago, nine out of ten doctors in the U.S. updated their patients’ records by hand and stored them in color-coded files. By the end of 2017, approximately 90% of office-based physicians nationwide will be using electronic health records (EHRs).” That’s good news. Most healthcare providers in small, medium and large facilities now use some form of a MU compliant EHR.
–Are the doctors, clinicians and their provider organizations using the EHRs happy with them? According to this Healthcare IT News survey, the answer is “sort of”. After years of frustration, the survey results indicate satisfaction is getting better but there is plenty of work left to make these systems more user-friendly. Apparently, the forced march was so intense and urgent that good User Experience designers and principles were often not invited to the party.
–Did the grand nationwide EHR implementation project from 2009 to 2017 encourage innovation in healthcare organizations or actually inhibit it? It’s a fair question. I don’t know if inhibit is the right word, but innovation took a back seat for sure. Many hospital and ACO organizations didn’t have enough bandwidth or funding to innovate as they were overwhelmed with EHR implementations. And the EHR vendors, who we have partnered with in the past, were focused more on capturing market share (and the $20 billion the government was tossing around), complying with MU requirements and managing implementations than on innovation. My take is that innovation during this period, especially early on, was ceded by the bulk of the industry to risk-taking startups attempting to disrupt while the big boys were busy. This is how outfits like Rock Health and Jumpstart Foundry got their start.
–Were the provider organizations traumatized by the implementations? Why is this important? If you’ve ever been involved in a substantial technology project for your company and it had major change management implications, you were probably personally impacted, maybe even traumatized. While a hospital’s appetite might have been wetted by implementing new technology to improve patient and business outcomes, sizable challenging projects wear down the ability of an organization to jump right back into those waters. If your organization was particularly challenged with an EHR implementation, your leadership most likely hit the pause button on any major technology projects afterward for a few years.
And finally, what new technologies have emerged and/or matured in recent years to the point of having enough potential and positive impact such that provider organizations cannot or should not wait to take advantage of? The list includes Artificial Intelligence and its little brother Machine Learning, Blockchain, IOT and even CRISPR to name just a few.
Four years after asking the question in March of 2014, we can now ask “what impact did the EHR Meaningful Use era actually have on healthcare’s appetite for more technology?” Well, it’s a mixed bag answer in our opinion.
Many provider organizations, especially the smaller ones, were overwhelmed by an EHR project. Their “let’s take a break” period will likely be longer than for larger organizations who have more experience with comprehensive technology projects. For a variety of reasons, providers are under more financial stress today than ever before. Even if their appetite for new technology was indeed wetted, they often don’t have the funds, team resources or organizational capacity. And to make matters worse, the now consolidating EHR market is forcing many of these smaller organizations to switch to other EHR vendors on the heels of going through an implementation just a few years ago.
Larger organizations are better off, especially Integrated Delivery Networks. They aren’t so much concerned with switching to another EHR vendor because they most likely selected one of the Top 5-10 who aren’t being acquired. In fact, the top EHR vendors are now building out full platform portfolios of technology solutions for their customer base. What the bigger provider organizations are doing is investing in Digital Transformation, some in very significant ways and funding levels.
While the majority of providers are fatigued and need a break, the large IDNs are being served well by the EHR’s innovation. Since these IDNs no longer have to worry about “clinical” innovation, they are moving on to Digital Transformation and clamoring for technologies like AI, ML, Blockchain while also ramping up Telehealth and other distributed patient engagement solutions – see Forbes Top Five Digital Transformation Trends in Healthcare here. And they have plenty of funding to push it along. Therefore, the industry will be looking at the large IDNs to drive innovation by pushing (or dragging) the smaller providers that will have to fight through the fatigue in order to keep up. How’s that for my next prediction?
And what is really telling is the massive amounts of private capital flowing into Digital Health since 2009, but especially since 2015. Solid information on venture capital investments in healthcare is hard to come by. Solid is the key word. But a PWC/CBInsights report estimates the CAGR of annual healthcare venture funding to be almost 14% from 2012 through 2017, ranging from $6.9B to $14.4B. That’s stout by any measure. Obviously, this is not just investments in technology, but it clearly represents the intense level of interest the capital markets have in the healthcare industry. And of course, with Big Tech (Google, Apple, Amazon) and Big Players (Walmart, CVS, JP Morgan, Berkshire Hathaway) ramping up health-related plays the industry is getting a ton of love and attention. Which, by the way, might foreshadow a bubble but in the meantime, all of that should divine some very useful and exciting innovation.
Let me bring all of this back to the hospitals, ambulatory care providers, surgical centers, clinics and others who were incentivized (forced) into adopting Electronic Health Records. In 2018, one can argue they are probably over the forced march of adoption, and with the massive amounts of interest in healthcare from the capital markets, Fortune 500 and startups, they have more and more interesting options to apply technology to improve their operations and patient outcomes. Frankly, they need to because if they don’t they will be run over by new forms of competing healthcare providers and services right around the corner who will be using innovative technology to advance their business models. Another prediction we will follow up on down the road.
David Karabinos is CEO of PointClear Solutions, a technology consulting company that specializes in providing software strategy, design, development, and management services for the healthcare industry.
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