Q and A With Jeff Goldsmith

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Health Futures, Inc.

The author of Digital Healthcare describes what has not changed in healthcarein the past 30 years.

Healthcare Technology: In your book Digital Healthcare, you described how the medical records were stored in the basement of the University of Chicago’s hospital in 1975.What percentage of healthcare systems continue to store records like that? Do you think that in five years we’ll have total adoption of EHRs?

Jeff Goldsmith: I would say that less than 2 percent of the healthcare organizations in the U.S. of any description are paperless, if you define paperless as no paper charts and complete electronic ordering. In five years, that number may be 20 percent. I think it’s going that slowly — the larger the institution, the slower it goes. It’s actually a lot easier to do this from a green field than to lay an enterprise solution over dozens of poorly integrated legacy applications. The numbers that I’ve seen suggest that clinical information systems (CIS) spending is no more than $8.5 billion a year in the U.S., and growing at perhaps 10 percent a year. You’re not going to get from that to $276 billion — which is the amount that is required — any time soon.

HCT: Do you think we are 10 years away from total adoption of EHRs?

JG: I think it’s a lot longer than that. I understand what Dr. Brailer is doing and he’s doing the right thing. It really does not make sense for the federal government to be subsidizing IT investment until the systems can talk to one another. But the reality is, it’s going to cost tens of billions of dollars in federal money to get the safety net providers, the community health centers, the critical access hospitals, the large urban public hospitals and the cash-strapped primary care physicians to do this. I don’t think we’re anywhere close to getting this right as a society.

There’s a cone of hype surrounding this effort. Inside the cone, everyone agrees on how important this is. Outside the cone, it’s business as usual, and managers and clinicians are worrying about the same things they were worried about five years ago. I don’t think this has penetrated very far into the consciousness of people who are actually operating healthcare institutions. I don’t think this is yet the No. 1 agenda item on the minds of most health system or health claims CEOs. Twenty years looks a lot more realistic to me. It’s a generation’s worth of work.

HCT: Over a year ago you published a paper in Health Affairs entitled “The Federal Health Information Policy: A Case of Arrested Development.” The paper argued that federal action is needed to speed the implementation of digital CIS. How much federal action has there been, and how far along are we in the process?

JG: Well I think the most important thing that’s happening is the creation of a certification process that drives interoperability. Until you have a consensus of how you define an appropriate record system, you can’t incent people to adopt it. So I think that Dr. Brailer started in the right place. The problem is, it’s going to take forever to do this. And very few of the actors involved in this process really have an incentive to reach resolution quickly. To an extent, this is unavoidable. You have a $2 trillion health system that you’re essentially trying to rewire while it’s operating. That’s the size of the entire German economy. In terms of degrees of difficulty, this is very, very difficult. So the fact that it’s going to take a lot longer than ten years is as much a reflection of how vast, complicated and unwieldy our health system is as on the quality of the leadership.

HCT: Your book discusses the roadblocks implementing a transformation, such as gaining physician support, balancing competing priorities and managing IT vendors. Which roadblock is the greatest barrier?

JG: I would have thought it would have been physician support, but I don’t think it is. I think physicians are ahead of the people running their institutions on this. If you show physicians a paperless world, a world in which they don’t have to have five fulltime employees in their office wrestling with medical claims, they can relate. They would really like to have the resources freed up, either to pay themselves a little more generously out of the money they’re getting or to use their clinical resources for enhanced service to their patients. I think the big problem has been the inability of hospitals and health systems to allocate a sufficient amount of capital and political bandwidth to actually make this happen. I don’t think this is top of mind for a significant number of CEOs. I’m not talking about the leadership at places like Kaiser or Ascension Health; these folks get it, and they’re making the investments to make this happen. It’s just that these places are still not the norm. I think we’ll be surprised at how long it takes the investor-owned firms,who have fewer valid excuses than the nonprofits, to get there.

HCT: Do you think that standards and privacy are two of the major barriers?

JG: I don’t think they’re the big ones. I think that the generation of people running healthcare organizations is just not comfortable with information technology. I think there is still a great degree of not only skepticism but frankly fear and ignorance about the use of these tools. And I don’t think CEOs really get that there’s a big gap between the institutions that they’re operating on a day-to-day basis and other sectors of our economy.

They ought to be embarrassed. But they’re not; they’re frustrated, and they blame their people, they blame their vendors, they blame Dr. Brailer, they blame the state legislature, they blame the health plans, and the health plans will blame the physicians. Blame, blame, blame. There’s a lot of finger pointing going on (just like there is on patient safety). But at the root of the blaming is a fundamental failure to take ownership. It’s interesting. If you look at the “big iron” companies that invested in clinical IT, such as GE and Siemens,what are they discovering? That the core businesses from which they generated capital to invest in clinical IT are actually growing significantly faster than clinical IT is. Imaging is eating IT alive. There are a lot of exciting new imaging applications — you’ve got the promise of molecular imaging, you’re got tremendous new hardware that’s coming out and for this generation of CEOs, purchasing more “big iron” is a lot easier to understand and do than buying a complex clinical IT product.

Implementing clinical IT is hard. If you do it right, everybody’s cheese gets moved. It’s disruptive, and yet to fundamentally improve clinical process requires disrupting existing routines and reconfiguring work flows and relationships. To do that you’ve got to be willing to not only understand the technology, you’ve got to be willing to commit yourself to working with it and working through it. And I don’t think that commitment is yet there in this industry and I wish I could say otherwise.

The fundamental challenge in the book Digital Medicine was a call to leadership. And I’m not sure we’ve got that leadership yet. We need it. And it may just have to wait for a new generation of leaders that grew up with these technologies, for whom using them is as natural as breathing, before we really get that whole-hearted commitment needed.We’re not making optimal use of our clinical resources.We’re burning out our workforce.We’re needlessly damaging patients. A lack of patience with an unsatisfactory status quo is essential to making the digital transformation happen anytime soon.

HCT: There are some trends that could reshape the healthcare system such as consumer-directed plans and pay-for-performance. Do you think we’ll continue to see more of this?

JG: At the heart of both of those issues is changing incentives, changing the signals that are being sent to the care system, as well as to patients and their families, about what we want them to do. Here, too, I think the progress is just glacial.

At max, there are 3.5 million people right now in consumer-directed plans. In order for them to have a transformative impact on the way the healthcare system works and on the way people behave and on their own health, we need 40 million to 50 million people enrolled.

With pay-for-performance, I think it’s very important to send signals that folks that adhere to clinical protocols and that listen to their patients and that are responsive to professional guidance about standards of care ought to earn more than people who don’t or aren’t. But if it’s 2 or 3 percent, or 5 percent difference in someone’s income, summed across all their payers, I don’t think it’s going make that much of a difference. Pay-for-performance is an area where the fragmentation of payers and the bewildering contracting maze hurts the ability to make real progress.

I think until the payment system starts saying we’re not going to pay for fixing the errors, we’re not going to pay for the re-admissions, we’re not going to pay for the extra week that someone spent in an ICU because we gave them an infection or the wrong drugs, then the industry is not going to deal with its quality problem. I recently read an article in JAMA that said there has not been significant progress in reducing avoidable deaths in our hospitals in the last five years. Here, too, it’s a question of ownership. Are management and boards going to own these issues? Are they actually going to take responsibility for them and change what they do on a day-to-day basis or aren’t they?