Mike Leavitt On Electronic Medical Records

Posted by Mark Brousseau

The Hill caught up with Health and Human Services Secretary Mike Leavitt to ask him about the status of the president's electronic medical records initiatives. The full transcript appears below:

Q&A with Mike Leavitt
By Jeffrey Young

In 2004, President Bush introduced a sweeping initiative to promote the development of a nationwide system of health information technology. One key goal is to provide every citizen with access to an electronic medical record by 2014. Bush tasked Health and Human Services Secretary Mike Leavitt to helm the gargantuan effort, which represents an attempt to bring together the private and public sectors to create a technological infrastructure for the healthcare system of the future.

Q: Is President Bush’s 10-year plan for electronic medical records on track?

I believe that will be accomplished. I think the goal may be exceeded. There will be a point where this begins to happen quickly. That’s the way technology develops: There are some early adopters, the mechanism has to be put into place, people begin to catch the vision. Once the consumer begins to see its value, it spreads quickly.

Q: Other than electronic medical records, what are the key components of a fully wired healthcare system?

I think it’s important to remember that the goal here isn’t electronic medical records. The goal is to transform the sector of healthcare into a system of healthcare, a system that provides consumers with information about the quality and the cost of their care.

To accomplish that, we need to have information digitized rather than on paper and we need to have that information mobilized so that it can be assembled in many different ways that are useful, not just to consumers but to various parties. If you look at digital health information, the goal looks different depending on who you are and what your interests are.

If you’re a consumer, you’re interested in having all of your health information accessible to you in a timely, useful way. You’d like to have your pharmacy records for the three pharmacies that you do business with in one place. You’d like to have the information from your doctor, from your hospital, from your specialists, from the labs, accessible to you in one place. You don’t want to have to go to your doctor and pick up a big brown envelope and transport it to a specialist for them to see a test that you took three days before. You’d like that to be electronically transferred, like everything else can be in your life.

If you’re a clinician or a doctor, you’re interested in having a clinical record that has more information than likely a consumer is interested in. You’re interested in being able to have decision-support information that would provide backup for decisions that you need to make, and alternatives and options that would help you make better decisions.

If you are a public-health expert, you’d like to be able to gather a lot of data from many different places. Even though it doesn’t have anyone’s name attached to it, it would provide you with statistical backup to look for trends. If you’re a researcher, you’d like to see something quite similar, but you would like to see it from a wider area.

My point is that, if you’re a consumer or a clinician or a researcher, all of this looks different to you. To put it a different way, it will look different depending on the way you view the world.

The goal here is to, first of all, get information transferred from paper into a digital format, then create a means by which it can be mobilized so it can be assembled in various forms, and to provide benefit to consumers, to practitioners, to hospitals, to researchers, to public health, or to those in the business of health.

Q: What will be the biggest advantages to better incorporating information technology into the healthcare system?

In the long run, it will provide better health, lower costs, fewer medical mistakes and a lot less hassle.

Q: All three of the presidential candidates’ healthcare reform plans depend in part on health IT saving money. How much money could be saved through the efficiencies that should come with from using these technologies?

The best source of that may be the RAND study. The RAND Corporation did a study that said … there was a 30 percent inefficiency in the costs. I’m not predicting a 30 percent reduction but I do believe that over time we can begin to have medical inflation more closely approximate regular inflation. If you could make that change in the glide pattern or the slope of growth, it would make a profound economic difference.

Q: Since the administration’s effort began, what’s done and what’s still to be accomplished?

Three years ago, there were 200 vendors who were producing electronic medical records for sale. None of them had the capacity to be interoperable because there were no standards for interoperability. Interoperability essentially means one computer system being able to talk to another.

We developed a process for developing standards that incorporated the medical family, developers of technology, government entities, insurance companies, et cetera, and have now instituted a means by which those standards are emerging.

We also created a process for certifying systems that meet those standards. Three years ago, there was no process and obviously no means of certifying that people were on the pathway to health IT or to interoperability. We have accomplished that: Some 75 percent of all the systems now available for sale are certified by the CCHIT, which is the Certification Commission on Health Information Technology.

Let me tell you why that’s important. I bumped into, at a pathology bench at Stanford University, a young student who was ready to go out into practice. He said, “I heard your speech about electronic health records and I subscribe to your view. In fact, I’m going to set my practice up next year and I want to buy a system. I only have one question: What system should I buy? I can only afford to do this once and I can’t get it wrong.” It was not possible for me to recommend a system before. Now, I’m able to say to him, “Whatever system you buy, make sure it is CCHIT-compatible. If you do, you’ll be on a pathway to interoperability and your vendor will need to continue to update their system to meet those standards.” I think that’s a significant step forward.

If interoperability was two feet long, we’d be at about the six or eight inches mark. Next year, we will be at eight or 10 inches. Each year, we’ll get a little closer to interoperability. We won’t see full interoperability for some time but we will see functional interoperability beginning to develop real soon.

That’s on records themselves. The next challenge is to lay in a system for a national health information network, where information can be transported between systems. We will see live data transmitted over that system in September. We’ll see real data begin to flow early next year. All of this is being done at a fairly rudimentary level. The sophistication of it will increase as our experience grows.

A second area of real challenge is in adoption among small- and medium-sized physicians. If you talk to a small- or medium-sized physician today, they will ask the question, “Why should I buy this system for $40,000 or $50,000 when the benefit will go to insurance companies and/or consumers/” We have to change the macroeconomics of medical reimbursement so that everyone benefits.

We have just announced and will conduct a Medicare demonstration project that will help us learn how to do that. We’re choosing 1,200 small physician practices throughout the country and we’re going to start paying them more if they have an electronic medical record. The second year, we’ll pay them more if they report a series of quality measures over their system. And the third year and the fourth year and the fifth year, we’ll pay them more if they can demonstrate that they followed the quality measures and report them on their electronic medical record that’s certified. Over that period of time, we’ll get better and better at learning how to share the value of electronic medical records with everyone.

A third step will be actual implementation of certain portions of it on a national basis. The most logical next step is e-prescribing. I’m hopeful that the Congress will act with the SGR [physician sustainable growth rate payment formula] fix, which will likely be at the end of June, to enable HHS to use its leverage as a payer to motivate physicians to adopt and use e-prescribing.

Q: What have been the biggest obstacles that have kept the healthcare system so behind the curve on IT compared to the rest of the economy?

First of all, it’s far more complex than any other sector of the economy. If you look at banks, for example, they’re highly interoperable but they deal with a very basic measure, and that’s the dollar. They have a currency and once you’re managing where those dollars go, it’s easier than if you’re having to develop the means of managing all of the conditions and the information that goes into healthcare. So, it’s substantially more complex. It’s also far more segmented.

There is no such thing as a national healthcare market. It’s a lot of individual communities and the collective network of communities is the national health insurance market. You essentially have to deal with this one marketplace at a time.

Q: Why is it important the federal government be involved in this process? Why can’t the private sector be left to develop this system on its own?

The best illustration of that is the fact that we had 200 vendors producing electronic medical records, all of whom viewed it as in their interests to be separate from the others to create proprietary interest. I believe the government has a role, and it’s to be that of an organizer of the system.

We have a role not just in our capacity as regulators but in our capacity as a payer. Medicare is the largest single payer. Medicaid, through its affiliations with the states, is another very large payer. That gives us the responsibility, in my judgment, to motivate a collective action. There’s no one else who has that amount of influence.

Q: Who should be responsible for covering the costs of developing and implementing IT in the medical system?

I want to make sure that you and your readers understand what’s involved in interoperability. If you were to take five different systems that are different sizes and different complexities, they don’t need to do everything the same. They simply need to do a limited number of functions the same.

Just to give a rudimentary illustration, let’s assume that there were three systems: one that would do 100,000 different things, one that one would 50,000 different things, and one that would do 10,000 different things. We need those three systems only to do about 800 things the same in order for them to [be considered] interoperable.

We have identified those 800 things and were are aggressively working to develop standards that can be adopted by anyone who is developing a new technology, whether it is a device that could monitor health results outside the hospital or whether it’s a clinical system or a system at a pharmacy, and all of these need to converge.

Let me give you a good example. We know that if diabetics have their hemoglobin A1c tested every quarter, that the chances of them having a complication that would cost a lot of money is reduced because we see the complications as they develop and we can get ahead of them. Well, sometimes it’s difficult to get diabetics to test their blood sugar every day, let alone their hemoglobin A1c on a regular basis. I saw a cell phone that had the equipment necessary to check one’s blood sugar, and various other components, built into the cell phone. You could prick your finger, draw the blood with the end of your cell phone, it would then analyze the blood and use the telephone technology to send it back to an electronic health record. That would be a valuable way of managing the chronic illness of diabetes, but if the cell phone collected the information in a form that could not be transmitted through the telephone to the electronic health record, we would have missed out on that opportunity. So the standards not only apply to electronic medical records, they need to apply to devices that may be in the marketplace.

The private sector will be developing the technology. We simply need to provide the basic standards that they can build into the technology so that it can communicate with other technology that may be developed independent of them.

Q: What are the key legislative changes that Congress should consider in the near term?

Congress could do four things in the near term that would have a substantial impact on this vision maturing.

The first would be standing behind the standards process and developing all of our incentives to support that. Interoperability requires standards. A network, a system, requires standards. If you look at other industries that have been through this — you look at cell phones, you look at ATMs, you look at things as big as airports — they all require standards so that information can be used interchangeably as it develops. It’s vital that Congress support the standards-development process that we have in place that’s now working and that any legislation they do points toward that, as opposed to competing with it.

The second thing I would point to is e-prescribing. That’s a logical next step. We have the technology in place, the standards are in place, we know it saves time and money — and it’s time. The legislation that’s being proposed would provide the secretary with tools necessary to leverage our power as a payer in encouraging the rapid adoption of e-prescribing.

I think a third area would be in helping us leverage our power as a payer to encourage the adoption of electronic medical records. …

When they put [ATMs] into banks, people didn’t use them. They were accustomed to walking up to the counter and dealing with a teller who had become their friend. They first put people in the lobbies to try to bring people over to the machine and teach them how to use it. They would give them toaster ovens and lots of things to incentivize them to use the ATM because it was a more efficient way. At some point, the banks concluded, “We can’t afford to do business with you in the same way if you insist on using the teller at the counter for every transaction. Therefore, we’re going to charge you more if you go to the counter.” Once they did that, people started to move to the ATMs. The same thing was true when we went from dial telephones to touch-tones. There was a transition that had to take place in the way people used the telephone.

We’ll have to go through the same thing with electronic medical records. At first, we’ll have to give people incentives and reasons to use it. But there will be a point where we will have to say we can no longer afford to deal with you in the same way if you’re not going to use the most efficient way of doing business. So, we’ll continue to pay you, but we can’t pay you at the highest level unless you have electronic medical records. There may be, at first, some kind of incentive that helps them transition, but at some point, they have to recognize that they can’t be paid the same if they’re less using a less efficient way of doing business.

The fourth one is, one of the real virtues of electronic medical records is the ability to define quality and cost in a way that’s usable for consumers. The most important tool in doing that is information from claims data. Right now, we have two federal courts that are conflicting on the use of Medicare claims data. A Florida court says we can’t give to anybody to measure quality and a D.C. court says we have to give everything to everybody. Neither of those is the right answer. The right answer is to use the data in way that will help define quality in a controlled and effective way. We need legislation to resolve that dispute. I might add that all of those are part of the SGR legislation.…This isn’t about having people have computers that keep electronic data. It’s enabling the data to be in a form that’s usable to people and that can be mobilized and assembled in a lot of different ways.

One of those ways is giving consumers information about the cost and quality of their care so that they have choices and they can compare. We know when people have choices, they make decisions that drive the quality up and the costs down.

Health information technology is an enabler of better quality, lower costs, fewer mistakes and more convenience.

That’s why we push for electronic medical records. It isn’t just because it’s a tidier way to do business. It’s because it produces value. The actual implementation of the records is a necessary step toward that larger goal. The goal is the value that the records produce, not just the existence of the records.

Mobile Deposits Drive Mitek's Turnaround

Posted by Mark Brousseau

An interesting article on Mitek in yesterday's USA Today:

Mitek CEO pins turnaround on wireless check deposits
By Greg Farrell, USA TODAY

When Jim DeBello launched his technology career two decades ago, a mentor told him that on top of getting an education, he'd also get bloodied and bruised.

"He was right on all counts," says DeBello, CEO of Mitek Systems. "It's been a school of ups and downs and sideways."

Not that DeBello, a defensive end for his college football team, minded getting knocked around. Just the opposite: The lessons from his failures have improved his game immeasurably. "It's a lot of fun to be challenged by the unknown and untried," he says.

Into the unknown is where DeBello has brought Mitek, an image-recognition software company based in San Diego. After being installed as CEO five years ago, DeBello has pushed Mitek's image-recognition tools onto wireless platforms. In January, the company introduced an application that enables consumers to scan and deposit checks with their cellphone cameras.

Whether it works — and returns the company to profitability — remains to be seen. But for DeBello, who dabbles in oil painting in his spare time, technological innovation is inspiring.

"Innovation is the heart of technology start-ups," he says. "I'm not an artist, but it's the closest thing to art I can think of."

DeBello's first tech start-up, Solectek, married wireless technology to laptop computers. Great idea, right? Sure, but not in the early 1990s. Today, nearly every computer is configured for wireless operation, but back then, at a time when Internet connectivity was painfully slow and before the widespread adoption of cellphones, DeBello's wireless local area network concept was an idea ahead of its time.

Getting ahead of yourself can be costly
"If you're way too early, you're thinking too far ahead," says the 49-year-old San Diego native. "Sometimes it takes anywhere from eight to 10 years for technology to get adopted. We need to digest it."

The experience of being sacrificial pioneers was a painful one to DeBello and his colleagues.

After selling the company in 1996, DeBello moved to Qualcomm, where he continued to work in the wireless area, and eventually ran a joint venture. But he grew tired of corporate hierarchy. "I didn't want to spend all my time working on internal alignment, the political nature of the organization and such," he says. "It was just not inspiring or enjoyable."

By 1999, DeBello had accumulated enough experience to qualify as a "grown-up CEO" candidate in the world of dot-coms. He became chief executive of CollegeClub.com, an early social-networking site. But in 2000, just as the company was about to go public, the dot-com bubble burst and the game was over.

Through his mentor, technology investor John Thornton, DeBello had held a seat since 1994 on the board of Mitek Systems. During the Cold War, Mitek had been a major supplier to the U.S. government of security hardware products that helped prevent the Soviet Union from eavesdropping on electronic data transmissions through computers, faxes and printers.

When the Cold War ended, demand for its product disappeared, and the Mitek workforce dropped from 300 to 16. In the 1990s, Mitek used its recognition technology capabilities to help banks with their check-processing operations. But the financial results were disappointing.

Giving Mitek a new direction
In 2003, dissatisfied with the direction the company was taking, Thornton installed DeBello as Mitek's new CEO. Since then, DeBello has divested two products and redirected the company toward mobile imaging.

The result: In January, Mitek announced a new software application, Mobile Deposit, designed to allow consumers to scan and deposit checks into their bank accounts using the cameras on their mobile phones.

Although some banking experts believe consumers will embrace mobile banking in the near future, DeBello wants to market the product to small businesses that accept and deliver goods or services. Of the 32 billion checks written in the USA each year, DeBello says 20 billion are for business transactions.

For truck drivers who collect cash on delivery, Mitek's application would allow them to cash a customer's check instantly, instead of leaving the premises and hoping that the check doesn't bounce. It would also come in handy for anyone from the plumber to the Amway salesperson who accepts checks for payment.

"Mobile banking 1.0 was bill pay and balance transfers on the cellphone," DeBello says. "Mobile banking 2.0 is about payments. We have a real big piece of that in terms of the ability to deposit checks."

For Mitek, which lost $384,000 in fiscal 2007 on revenue of $5.6 million, the new product could transform red ink into black. DeBello's now working with several companies to test drive the product.

How Mitek's technology can be put to work
"This is a technology that will change the game," says Chris Cramer, CEO of Karl Strauss Brewing, a San Diego craft beer. California state law restricts how much credit a beer distributor can extend to restaurants and bars, and Cramer says he's considering putting Mitek's new application into the field.

"There's tremendous turnover in the restaurant business," Cramer says. "You need to keep people 30-days current. Here's an opportunity to know instantly if there are sufficient funds in an account, and to have that information routed through the accounting system and go to the (chief financial officer's) desk so he can make a decision."

Danny Jett, executive vice president at Georgian Bank in Atlanta, says Mitek's product could add greater efficiency to the banking process. "All banks are suffering from margin compression," Jett says. "You look for ways to do things more effectively. That's what I see with Mitek's product. Is it going to be accepted now? Who knows? But within 12 to 18 months, acceptance will increase. That's the way Internet banking was."

Business Intelligence 2.0

By Mark Brousseau

A new buzz in business intelligence (BI) is business intelligence 2.0. That’s according to Accenture. While traditional business intelligence and data warehousing are concerned with analyzing the past, BI 2.0 concentrates on the future. Put simply, it refers to drawing inferences from historical data, applying the resulting insights to events as they happen and then managing future events through predictive analysis, Accenture says.

Just a few years ago, it took weeks or even months to detect an unusual process, analyze the event, formulate and take the required actions. BI 2.0 provides these capabilities in real-time. BI 2.0 brings a burst of radical thinking and a fair number of promises that, when realized, will make a real difference to bottom lines and help companies move towards high performance levels. But what is really needed to embrace BI 2.0? Smart CIOs are examining their data management.

Accenture’s research has shown that 92 percent of CIOs widely include structured data in their information strategies and almost 60 percent see BI as a core component for competitive differentiation. These findings come as no surprise but disturbingly, traditional business intelligence is too often used in an undifferentiated way. Aggregated data from the past is often viewed outside of its context and compared with static key performance indicators. Knowledge workers receive standardized reports and then take time to interpret the data and make decisions.

Business intelligence 2.0 focuses on business events and how business processes and business users respond to them, Accenture says. For example, unusually high returns of a best-selling product would lead to the examination of many factors. Is that particular batch of product faulty, is there a pattern to the consumers who are returning this product, is there a problem with the packaging, or the sales staff, or even evidence of fraud? In this simplistic example, an "event" called "product return" triggers a series of responses that require access to information and should trigger intelligent decision-making, based on a variety of conditions.

The vast majority of applications and processes have limited ability to absorb changing business needs, are not explicitly defined and do not have comprehensive metadata management processes, Accenture notes. If we are to make BI 2.0 a reality, we first need to look at the assumptions and promises of BI 2.0 from a data management perspective.

How is your organization refining its use of business intelligence? Post your comments below.