ICD-10’s Hidden Cost

The characters on the train into Philadelphia, while never dull, were more interesting than usual this morning.  The woman across the aisle from me wore her hair in a style that could be described best as resembling a termite mound.  The ride felt so much like bumper cars that I was tempted to ask the driver if he had to pass some sort of training program to get his license, or if all he had to do was to collect a certain number of bottle caps.  It gives me the feeling that there should be a lifeguard at the gene pool.

The med student seated next to me on the train reads his book, but then, everyone one the train reads. I asked him what he was reading.  Turns out it was a book about converting from ICD-9 to ICD-10.  Medical coding.  Those little numbers, charge codes, on your doctor’s invoice that enable the doctor to charge you for the specific services provided.  There didn’t seem to be much of a plot, and he did not seem to be very engrossed in the material.

The conversion from ICD-9 to ICD-10 may be the biggest gotcha on healthcare’s horizon, especially with regard to hospitals.

Money will be spent and money will be lost—lots of it.

Health and Human Services (HHS) estimates that the cost of converting can be broken down into three categories, and it estimate the relative cost of those categories:

  • Training                              22%
  • Lost productivity               35%
  • System changes                43%

Two of these, training and system changes, are controlled variables.  They relate to things the service provider will be doing.  The other, lost productivity is the result of how well the service provider managed the other two.

HHS estimates productivity charges will range from 6-10% due to the fact that it will take people between 500 and 1,000 hours to become proficient in the new codes.  Others have estimated that for hospitals with more than 500 beds the total cost of the conversion (actual cost plus opportunity cost) will be more than ten million dollars.

So, in layman’s terms, what does that mean with regard to the business of managing the hospital?  How does one develop a project plan for lost productivity?  What are the tasks?

Let’s look at what is involved.

System Changes:

Everything will be changing; business rules, business processes, forms, reports, and systems.  Ask yourself which systems that you use involve coding?  Now ask yourself if you like using those systems.  Are they easy to use?  Are they easily understood?  If the only thing changed in those systems is the codes, they will still be just as tedious to use and those systems will be less usable.

A large hospital will spend five million or more dollars to change systems and the end result will be that those systems, at least for the first 500 to 1,000 hours will be less usable.  I believe those hours are underestimated.  Most systems are tied to other systems into what has become a bit of a kluge.  Changing integrated systems is a lot like playing the children’s game Pick Up Sticks—touching one stick often winds up making things happen to the other sticks.  Changing one system will cause things to happen to the other systems.  Ineffectiveness breeds more ineffectiveness.

Lost Productivity:

According to estimates, thirty-five cents out of every dollar spent on the conversion will be allocated to lost productivity.  This is like buying a gallon of milk and having to pour a third of it in the sink before you placed the carton in the refrigerator.

What are the why’s and where’s of the productivity loss, and what can be done about it?  Interpreting the HHS estimates, they are essentially stating that while the conversion will be done, it will not be done well.  In fact, those in the know published that hundreds of millions of dollars will be lost converting to ICD-10.

Will your hospital be contributing to that loss?  Without question; unless you figure out the causal factors of that loss, and put a plan in place to prevent it.  HHS calculates hospitals will lose thirty-five cents on the dollar even after having spent twenty-two cents of every dollar to train people.

Plan on fifty-seven cents of every dollar spent on the conversion to ICD-10 being wasted.  Get that milk carton out of the refrigerator and pour some more into the sink.

Training:

The training program envisioned by HHS that hospitals will undertake will result in a planned productivity loss of thirty-five percent.  What will your productivity loss be if your training program is less effective than whatever HHS was envisioning?  Clearly they are not holding out high hope for the success of ICD-10 training given that it is estimated that becoming proficient in the new coding could take one thousand hours.  (It only takes about 50 hours of training to obtain a private pilot’s license.)

Training, the variable over which a hospital has the most control is the area where the hospital has the least experience.  After all, the hospital has never had a business system designer design an ICD-10 training program.

Training will be about learning to use correctly new screens and forms and new business processes and business rules.  It must include those in finance and IT, coders, and healthcare professionals.  To be effective, it should be role-based; customized.

Left up to the usual way of doing it, hospitals will provide classroom study, 24-40 hours. They will probably develop a train-the-trainers program, and the trainees will be presented with a nice-looking ICD-10 training certificate.  Good luck.

Training may be needed for more than half of a hospital’s employees.  For training to be effective and to minimize the loss of productivity it must be designed.  It must include:

  • What will the altered systems user interface (UI) look like
  • Should people be trained on that UI, or will changing the UI result in much less training
  • What will the altered forms look like
  • Should people be trained on those forms, or could designing new forms result in much less training
  • Can the training be designed to be delivered online
  • Can the training be designed to be delivered on portable devices
  • Can the training be designed by roles
  • Can the training be designed by person to assess what areas need more training

The answers to these questions are Yes.  Whether it will be is up to you.  Designing a training program will significantly decrease the cost of training and significantly decrease the productivity loss.

HIT: Your most solvable big problem

Two incompatible things are a type A personality and heart disease—I speak from experience.  I usually run six miles a day, three miles out and three miles back.  A few weeks ago I started hitting a wall after two to three miles and found myself having to jog/walk back to the car.  Wednesday I hit the wall after a mile, hands on my knees and gasping for air.

The air thing bothered me because that is what happened during my heart attack in 2002.  As I tried to make it back to my car I had to stop every few steps to catch my breath.  As I made it to a field and lay down several people stopped to ask if I needed help—this is where the incompatibility I mentioned comes into play.

I did not want to impose.  One of those who stopped happened to be a cardiology nurse and she was not taking no for an answer.  Dialing 911 she stated “I have an older gentleman, 60-65 having trouble breathing.”  That got my attention—all of a sudden my age seemed to be a much more important consideration to me than whether or not I could breathe.  “I am 55,” I corrected her.

Knowing how close I was to my home I tried unsuccessfully to get the EMTs to stop by my house before going to the hospital so I could get my laptop.  After three hours of tests, and without concluding why I had trouble breathing, they ruled out anything to do with my heart and sent me home.

I think knowing when to ask for help and accepting help relates a lot to healthcare IT; EHR, Meaningful Use, ICD-10.  These are each big, ugly projects.  There are several things that can happen on big, ugly projects, and most of them are bad.  This is especially true when the project involves doing something for the first time and when the cost of the project involves more than one comma.

Now we both know there is nobody with years of experience with Meaningful Use or ICD-10, and there are not many people who have one year’s experience.  So why ask for or accept help?  The truthful answer is because there are some people who know enough to know what to do tomorrow, and from where I sit the toughest part of every project is knowing what to do tomorrow—how to get started, and what to do the next day and the day after that.

What if there was no Meaningful Use?

On April 16, 1912 there was an article in the Daily Register in Anytown, Nebraska titled “Local Man Drowns.”  The article went on to note that a local man was lost at sea.  I paused for a moment trying to recall from my high school geography class the name of the ocean bordering Nebraska—there is not one.

It did not take long to realize that the newspaper was guilty of being more than a little parochial.  April 14, 1912 was the day the Titanic sunk.  The man in question had been lost at sea in much the same manner that the real headline of the story had been lost by the newspaper.

I think a lot of important healthcare IT headlines are being lost, and those loses can in large part be attributed to the puppet masters at the ONC and CMS.  It is difficult to swing a dead cat in a hospital cafeteria without hitting someone discussing Meaningful Use.  On the other hand, you could swing a blue whale without hitting someone talking about ICD-10.

The headlines are both buried and misinterpreted.  Some of the HIT headlines merit being repeated—feel free to use a highlighter on your screen to be able to locate the important ones.  Trying to meet Meaningful Use:

  • Is optional.
  • Does not mean you will meet it.
  • Could require most of your IT resources.
  • Means you may not have enough resources focused on ICD-10.

While these may appear to be trivial comments, misapplying your efforts could cost a large hospital more than tem million dollars.  Then figure another ten million to rectify the mess.

Ask yourself one question before you hire a pricey consulting firm to help you figure out how to meet Meaningful Use.

“What would we be doing if there was no Meaningful Use?”

Then do that.  Meeting Meaningful Use was never a part of your business strategy—you probably will not find it written in your three-year plan.  Did anyone sign off on the notion of spending millions of dollars to complete a task that has no ROI and has a reasonable probability of failing?

If it so happens that in pursuing your original strategy you can still meet Meaningful Use that is good.  The reverse is not so good.

How should a provider approach Meaningful Use?

Of cabbages—and kings— And how does all that focus on Meaningful Use affect ones’ ability to address ICD-10?

And why the sea is boiling hot—and whether pigs have wings. Lewis Carroll, Out of the Looking Glass. It is a nonsense story, one which cannot be argued.

As are Electronic Health Records (EHR) and Meaningful Use (MU)—at least to date. Measured against any reasonable set of standards, except on a one-off basis, the national rollouts of EHR and MU have failed. I expect it will be even more so next year.
You, the public, have the right to comment, and we have the right to tell you why your comments hold no water. I think it is the inverse of you have the right to remain silent, you just don’t have the ability. I am writing about the ONC and the bone they tossed calling for public comment. They are required to provide for public comment in order to remove the N and the P from the NPRM.

Who among us believes the rule making will markedly shift direction as a result of any of the public comments? That is unfortunate for if they were to shift direction they might find a direction. We don’t know where we are going, but we are making good time getting there. Figures suggest a failure rate of EHR implementations of somewhere between fifty and seventy percent. As healthcare IT resources become scarcer, I expect the failure rate to increase. As providers rush into EHR without a detailed strategy simply to grab the incentive money, there will be more expensive failures. More failed EHRs is not a way to measure progress.
The current cover of Government Health HIT magazine depicts a foot race to meet MU. There is no race if there are no entrants. There may be more people on the cover than will actually qualify for the race, even fewer who will reach the end.

We would be better served if the plan for national rollout of EHR were not written on an Etch-A-Sketch. We don’t know what will be included in Stages 2 and 3 of MU. When will fifty percent of providers have an EHR, not just the software, but one that actually boosts productivity? How about 70% or 80%? Ten years? I ask the same question of the Health Information Exchanges (HIEs). Without unilateral adoption there will be large gaps. Will the national network function with these gaps? To what extent? Will the records only make it part of the way from Patient A to Doctor X?

Having not solved the EHR program on their own, and having no viable plan, the government laid the burden of making EHR successful on the backs of the providers. The government tries to offset the burden by offering financial gratuities—and penalties—to the providers. Not exactly the second coming of the Three Wise Men. Trying to hit the ONC’s targets is a little like playing the confidence game, the shell game. Under which shell will providers find the rules, the plan?
What to do?

It is easy to criticize. Permit me to offer a few suggestions. To the hospitals, if you are not well along the EHR path, do not make a difficult effort more difficult by chasing Gossamer incentive dollars. Stick to your plan. You have multiple failure points which three years from now will make chasing those dollars look like a pipe dream. The failure points? Your plan, the implementation, meeting the MU requirements, passing the MU audit. It does not look very promising to me.

To those hospitals which haven’t started their EHR initiative, or are less than halfway through the passing the failure points, don’t cancel your summer vacation. You have a lot more time to get it right then you have to get it wrong. Pay no attention to the man—or woman; even I can have a moment—handing out the Monopoly money. You won’t be receiving any. From where I sit, that is good news. It will cost a lot more to perform disaster recovery on a poor implementation than the funds you would have received by meeting MU.

How long does a hospital spend planning to build a new hospital wing? For large hospitals, the cost of your EHR will likely exceed the cost of the new wing. Plan accordingly. Invest six or nine months building a plan that might succeed.

For medium and small practices and solo providers you have nothing to lose by waiting a year months other than the resource problem. By then you will find very viable ASP and shrink-wrapped solutions.

Those who follow my blog, healthcareitstrategy.com, know I don’t write to garner favorable replies from those who think they’ve already got it figured out. I write for those who because of EHR have difficulty sleeping. Thanks for reading. As always, I appreciate your comments and disagreements.

Video Game Theory applied to Healthcare IT

My twelve-year-old son overheard a conversation I was having about EHR, Meaningful Use, and ICD-10, and I watched his eyes glaze over.  So I tried to explain it to him in terms I thought he might understand.  Maybe this explanation is the one I should have used with my client.

John and Sally have a thousand dollars in the bank.  They pool some of their money and have a hundred dollars to spend on video games.  The game they really want, Project From Hell, costs sixty dollars.  About half the people who play Project From Hell never make it to the end, and never get the chance to claim their prize.  It takes two years to play, and one or both of them could be eliminated from the game for failing to play well.

The second game is a take-off on Faust, Sell Your Soul to the Devil.  To play this game, you must first beat Project From HellSell Your Soul costs thirty dollars.  However, the upside is that if you win, which is not very likely, you can earn two dollars.

The third game, Bet Your Savings, is the most intriguing.  All kids who have a computer must play Bet Your Savings, which costs thirty-five dollars.  The way Bet Your Savings works is that if you do not play, or if you play and lose, ten percent of the money in your bank account disappears.

I asked my son which games John and Sally should buy.  He said if they bought Project From Hell and Sell Your Soul, they would only have ten dollars left, and that the reward from Sell Your Soul, two dollars, was not worth much.  He also noted they do not have enough money to buy all three, and that since Bet Your Savings was mandatory, unless John and Sally wanted to automatically lose ten percent of their savings, they must choose Bet Your Savings.

He decided they should buy Project From Hell and Bet Your Savings.

By now you have figured out the Project from Hell is your EHR, Sell Your Soul is Meaningful Use, and Bet Your Savings is your ICD-10 initiative.

Resources are scarce.  Do you have enough money to do Meaningful Use and ICD-10 correctly?  Many hospitals do not, and yet they are charging full tilt at meeting Meaningful Use to possibly net a few dollars.  Many hospitals have not invested enough to meet ICD-10.

Where should you place your limited resources?  If you are still confused, feel free to ask my son.

Video Game Theory applied to Healthcare IT

My twelve-year-old son overheard a conversation I was having about EHR, Meaningful Use, and ICD-10, and I watched his eyes glaze over.  So I tried to explain it to him in terms I thought he might understand.  Maybe this explanation is the one I should have used with my client.

John and Sally have a thousand dollars in the bank.  They pool some of their money and have a hundred dollars to spend on video games.  The game they really want, Project From Hell, costs sixty dollars.  About half the people who play Project From Hell never make it to the end, and never get the chance to claim their prize.  It takes two years to play, and one or both of them could be eliminated from the game for failing to play well.

The second game is a take-off on Faust, Sell Your Soul to the Devil.  To play this game, you must first beat Project From HellSell Your Soul costs thirty dollars.  However, the upside is that if you win, which is not very likely, you can earn two dollars.

The third game, Bet Your Savings, is the most intriguing.  All kids who have a computer must play Bet Your Savings, which costs thirty-five dollars.  The way Bet Your Savings works is that if you do not play, or if you play and lose, ten percent of the money in your bank account disappears.

I asked my son which games John and Sally should buy.  He said if they bought Project From Hell and Sell Your Soul, they would only have ten dollars left, and that the reward from Sell Your Soul, two dollars, was not worth much.  He also noted they do not have enough money to buy all three, and that since Bet Your Savings was mandatory, unless John and Sally wanted to automatically lose ten percent of their savings, they must choose Bet Your Savings.

He decided they should buy Project From Hell and Bet Your Savings.

By now you have figured out the Project from Hell is your EHR, Sell Your Soul is Meaningful Use, and Bet Your Savings is your ICD-10 initiative.

Resources are scarce.  Do you have enough money to do Meaningful Use and ICD-10 correctly?  Many hospitals do not, and yet they are charging full tilt at meeting Meaningful Use to possibly net a few dollars.  Many hospitals have not invested enough to meet ICD-10.

Where should you place your limited resources?  If you are still confused, feel free to ask my son.

 

ICD-10: the true cost of having no experience

The thing I like least about flying has to do with my control issues; someone else controls the plane and there is nothing I can do about it.  The pilot’s voice seemed to say “Put yourself in my hands.”  Like nails, I thought, like carpentry nails.  As a result I find myself creating caricatures of the people seated around me—I can choose do that, or I can choose to rush the cockpit and wind up being a two-minute feature on CNN with the other passengers asking how I got the gun on board.

I get as excited about someone sitting next to me as a dog does about a new flee crawling around on his hind quarters.  Picture the woman who sat next to me.  I was tempted to ask her how she could dress like that but, I worried she would reply “From years of practice.”  She looked like a disaster victim might be expected to look—a tattered, grey wool blanket draped over her shoulders.  The only thing missing from the scene was a reporter standing over her asking her how she felt about the plane crash.  Her face was strong and equine, with a straight nose that veered slightly leeward.  As she gnawed angrily at her gum with her front teeth, her fingers gripped the armrests so tightly I could foresee the need to call a flight surgeon upon landing to amputate her arms at her wrists.

Anyway, that was my flight.  Yours?  Here’s the segue.

Picture the makeup of the attendees of your last meeting (circle the topic that best describes its purpose; EHR, Meaningful Use, ICD-10).  As I look around the conference table, sitting directly across from the bagels is Jackie.  Jackie has been a member of the IT team since the invention of punch cards.  Bill still prefers to use the “portable” Compaq suitcase PC he was issued during the time the US was playing Reggae hits over loudspeakers trying to coax Manuel Noriega out of Panama.  And Mindy has stormy eyes—sorry about that—Mindy has a coffee mug collection acquired at the going away parties for the prior seven CIOs.

Our Lady of Perpetual Billing’s hospital information technology A-team is waiting to see exactly what type of fertilizer is about to be loosed upon the windmill of their little shop of horrors.  They run a taught ship; nothing slips by them, and nobody can match their job performance.  The last unpaid claim was six years ago, and their efforts have made patient satisfaction so high that the hospital cafeteria’s reservations are booked solid through year end.

It is usually good to have experienced people.  People with twenty years of experience.  Is it twenty years of experience or twenty in one year’s worth of subject matter?  My son has three years of Pokémon experience which makes him an expert on all things Pokémon.   This turns out to be a pretty valuable skill as long as the conversation stays on point.  Unfortunately, being an expert on Pokémon does not translate as readily as he would like me to believe to other areas requiring his attention, areas like cleaning his room.

So, let’s get back to the issue of Jackie, Bill, and Mindy, and our collection of three IT projects.  We can all agree people with their level of experience are very good at what you need them to do, in fact, they are probably irreplaceable.  They know what to do from the moment they enter the building until the moment they leave.  They are in their comfort zone, even though the hospital may not be in its.

Somebody has to work on EHR, Meaningful Use, and ICD-10.  Do you pick people with twenty years of one-year experience?  You may not have a choice.  Twenty years of one-year experience may be the worst kind of experience to add to your team.  It is a given that nobody in your organization is pushing around a wheel barrow full of Meaningful Use or ICD-10 experience.

I spoke with the CIO of a large hospital and listened as he described the hospital’s ICD-10 initiative.  I did not have the heart to tell him that the use of the word “initiative” was overly ambitious.  The initiative was little more than a meeting of a half-dozen “experienced” people; people from operations, finance, and IT.  People who were very good at their jobs—naturally, they had been doing them for…say it with me…twenty years.  One of the CIO commemorative coffee mugs sat on the conference table.

These meetings generally begin and end with unblemished legal pads sitting in front of each participant.  Why?  Let us explore that question for a minute.  The group’s charter is to figure out what the hospital needs to do to be HIPAA 5010 ready by the end of 2011, has to be ICD-10 compliant by the end of 2012, and has to determine what it will cost and what resources will be needed.

Suppose that is your charter, or the charter of someone in your hospital.  How will those with twenty years of one-year experience help you?  What is the first thing you need to do?  What is the second?  What should the group be doing two weeks from Tuesday?

Maybe the best thing to write is “We do not know how to do this!  We need help.”