The role of information technology is not to replace clinicians, but to change their work environment to provide better job satisfaction and better patient care. By redesigning clinical processes and automating them with enabling technologies often through innovative outsourcing arrangements health care providers transform themselves into competitive enterprises that better serve their communities.

The health care industry is experiencing a worsening shortage of health care professionals. Though the national shortage of nurses is the most recognized crisis, a recent report from the American Hospital Association shows that 89 percent of hospital chief executives report significant personnel shortages in nearly every type of hospital job. If current trends continue, the United States will employ about 1 million fewer nurses than it needs by 2020 (see Figure 1).

Figure 1: National Supply and Demand Projections for FTE Registered Nurses: 2000 to 2020 Source: Bureau of Health Professions, R.N. Supply and Demand Projections

As the crisis worsens, people who remain in the workforce are becoming progressively overworked and demoralized, often more focused on administrative tasks than on the delivery of patient care. Mistakes are likely to become more frequent and widespread as job stress and dissatisfaction increase. Job satisfaction among health care professionals is dropping, and staff turnover, especially among nurses, is rising. Clearly, the health care industry’s status quo has a discouraging prognosis. Fortunately, there’s a cure. It’s called clinical transformation.

IT: From High-Tech to the Right Tech

For decades, health care organizations sought to develop information technology systems to improve efficiencies in delivering patient care, and to relieve clinicians’ administrative duties in order to increase “patient time.” For the most part, their IT investments failed to deliver on even these limited goals. What they created is a patchwork of disparate systems that partially automate non-core functions and generate more overhead work than they displace. These so-called “best-of-breed” proprietary systems generally lack the ability to integrate the minimal data they exchange. These disjointed systems fail to deliver efficiencies that justify their cost. More importantly, isolated applications may pose a significant threat to patient safety due to “siloing” of critical patient information and system alerts. By contributing to the fragmentation of information and the inflexibility of processes, these systems have become part of the problem.

Health care providers are seeking examples and advice from other industries, which long ago began developing reliable information management systems and networks that can transparently and seamlessly integrate information across an entire organization and beyond. They’re learning new concepts like “workflow automation” and “enabling technologies.” They’re seeking more integrated IT systems that can collect enormous quantities of patient information, including a patient’s medical history, results of radiology or lab tests and other diagnostic procedures, records of medications ordered and dispensed, and other relevant data. The goal is to make patient data available wherever needed across organizations and systems.

The object of this quest is not a technology enhancement or an IT architecture overhaul, but a clinical transformation that results from redesigning clinical processes, then integrating and automating them through an advanced clinical information system (CIS). When leading clinical practices are implemented through a CIS, clinicians will be able to access this information in the pharmacy, in the lab, at the patient’s bedside, at the nurses’ station, or in the physicians’ office. Patients will be able to access their own medical information from home. Physicians will be able to order tests or medications from their offices and review the test results and confirmation of medication administration via the Internet. Nurses, unburdened from the tedious collating of charts, recopying of physician orders, and administrative tasks that currently occupy one-third to one-half of their time, will spend more time in the role that best serves both nurse and patient: caregiver.

It is this kind of reliable, integrated, and transparently networked information system that the Institute of Medicine of the National Academies had in mind when it said:

“The committee believes information technology must play a central role in the re-design of the health care system if a substantial improvement in quality is to be achieved over the coming decade …. re-organization and reform are urgently needed to fix what is now a disjointed and inefficient [health care] system.”1

No Margin, No Mission

Change, especially the fundamental changes needed to transform today’s health care provider into a competitive enterprise, is seldom simple or pleasant. It involves disruption of work routines; new, more collaborative relationships among clinicians; and re-evaluation by each clinician about his or her professional priorities.

Effective strategies exist for dealing with these well-understood factors, but the health care industry has been slow to adopt new business models for an additional reason unique to the industry: the perception that health care providers have a higher purpose than profitability. An academic or teaching institution serves the medical community through the “three-legged stool” of clinical care, teaching, and research. A community-based hospital contributes to the health and well being of its community by seeking to provide excellent care through top-notch facilities and talent, often regardless of a patient’s ability to pay.

Surely, staying true to these missions is more important that being competitive, isn’t it? Yes and no. The reality is that the health care organization that utilizes its resources most effectively will join more health plans and attract more patients. This organization can afford better facilities and working conditions, and so will attract the best talent. It will better retain the staff it must have to provide first-class health care. The “competitive” academic teaching hospital will attract the most accomplished specialists and the most qualified students. It will get more research grants.

In short, health care organizations that undergo the rigorous transformation process to become more competitive will better serve their missions to their communities. Studies have shown a direct link between delivering better care and maintaining solid margins. When addressed through a comprehensive program, quality of care, margins, and clinician satisfaction all improve.

The New Role for IT

The purpose of an advanced CIS is not to reduce the number of nurses or other clinicians required to staff a hospital. Organizations looking to technology to reduce full-time equivalents of nurses and other scarce personnel operate under a dangerous misconception. Experience has shown that the real benefit of a CIS is better patient care through more-informed decisions by less-distracted and more-collaborative caregivers. This benefit is realized only when physicians, nurses, radiologists, lab techs, pharmacists — the entire health care delivery chain — all exchange information and collaborate over a reliable and ubiquitous network. Such a system greatly reduces medical errors by eliminating the tiresome and error-prone tasks of transcribing, collecting, finding, or reviewing patient charts, lab reports, medication orders, or any of a multitude of paper documents.

Advanced clinical information systems enable knowledge-driven care. They remind clinicians of the treatment options that have resulted in the best outcomes for a specific diagnosis.

This guidance can be valuable in reducing costly and dangerous medical errors, particularly with drug therapies. A physician may not be aware of interfering medications or medical conditions that would preclude the use of a particular drug or require adjusted dosing. Many drugs require adjusted doses, for example, if the patient has impaired renal function. An advanced CIS alerts the physician to avoid overdosing the patient. Reducing the incidence of adverse drug events (ADEs) results from combining complete knowledge of a patient’s medical state with knowledge-based “triggers” that look for drug interactions and drug-disease and drug-allergy contraindications .

An advanced CIS manages and processes this kind of information. Hospitals where an advanced CIS is in widespread use by physicians and other clinicians have experienced dramatic reductions in ADEs and in the unnecessary hospitalization costs that often result. Relieved of tasks associated with remedying medical errors, clinicians find their workloads more manageable.

Getting the Pharmacist Out of the Basement (Changing the Roles of Clinicians)

An advanced CIS puts comprehensive information about the patient throughout the hospital and, via the Internet, into the physician’s office. Patient data include both historical and up-to-the-minute information such as the results of diagnostic tests and current vital signs. Information is always where it is needed. Wherever they are, clinicians always have access to comprehensive patient information. Pharmacists can practice their profession while engaged in direct patient contact. Pharmacy information is just as available on the patient floor as in the main pharmacy. Pharmacists are free to accompany physicians on rounds, becoming more collaborative health care partners. Caregivers and patients both benefit from such an arrangement.

Nurses, radiologists, and other clinicians, benefiting from a decreased clerical workload and increased availability of clinical information, can spend more time with patients. Patients receive better, more responsive care, and clinicians benefit from a more satisfying professional experience.

Maximizing the Impact of IT: Outsourcing

One of the lessons learned through clinical transformation is that the most significant benefits are realized only when core business processes — the delivery of patient care — are consistent with the proven best practices in the industry. Often, health care organizations possess neither the IT expertise nor the computing environment to support these best practices. In such a case, it is useful to remember that if IT isn’t your core business, someone else can probably do it better, faster, and cheaper.

A growing number of hospital groups are outsourcing their entire information systems departments to companies such as Cap Gemini Ernst & Young to take advantage of the experience, resources, and successful track record these companies provide. Outsourcing providers can leverage a business model across several clients, resulting in a more economical implementation. They have the flexibility and breadth of resources to call upon experts as needed. They can more easily invest in the best hardware and software tools and share them among multiple clients. They develop proven methodologies and bring lessons-learned experience to multiple engagements. They can provide services like a help desk, available to users at any time, which might not be practical for a single client to staff.

Traditional outsourcing arrangements aren’t enough. The confluence of redesigned processes with enabling technologies makes a clinical transformation initiative worthwhile. Outsourcing partnerships must be focused on collaborations that give each track the attention and resources it merits.

Outsourcing Options

A successful outsourcing relationship must recognize that technology is valuable only if it enables better clinical and business processes. An outsourcing partner should be prepared to offer a flexible array of options (see Figure 2) that goes beyond traditional infrastructure and applications management to involve the technology-enabled transformation of the entire clinical enterprise. While cost-savings and quality improvements will likely be achieved in Tiers 1 and 2, their ability to support operational change in Tier 3 will determine the real value.

Figure 2: Outsourcing Options

In-house IS departments face accelerating change. They lack the resources to handle change effectively. In general, they fail to deliver high levels of service even for the applications they currently support. Most health care executives feel their non-core activities are not cost-effective. CEOs and board members interviewed for the 2001 VHA Annual Strategic Study on Sourcing Options said they would be prepared to outsource non-core activities such as IS if they could be assured of high performance at low cost, and would have the capability to easily bring services back in-house if the outsourcing provider fails to meet expectations.

An outsourcing arrangement can bring to a health care organization both clinical expertise and implementation experience. Some outsourcing providers are confident enough to risk part of their fees on their ability to meet agreed-upon performance measures. That’s a tough combination for an in-house department to beat. For most organizations, outsourcing should be considered as a way of increasing the impact of IT on the workforce while mitigating the risks of transformation on the enterprise.


By engaging in clinical transformation, health care organizations can design and build systems to match their clinical processes. Benefits include more flexible information technology support, improved ability to deal with labor shortage issues, enhanced clinician satisfaction, and support for newer models of care. The end result is a renewed focus on the core business: delivering quality patient care.

1 Committee on Quality of Health Care in America, Institute of Medicine. “Crossing the Quality Chasm.” National Academy Press, 2001.