John Glaser
Tom Foley

Although the future of healthcare IT is difficult to accurately predict, there are several classes of technologies that an IT strategy should include.


At a Glance

A 10- to 15-year healthcare IT strategy should focus on:

  • EHRs
  • Business intelligence
  • Customer relationship management
  • Clinical decision support
  • Interorganizational systems
  • Connected care

Defining the future of healthcare IT in 10 to 15 years requires predictions of change for IT, the healthcare provider sector, and IT specific to the healthcare provider sector. It is difficult to make an accurate definition.

To a degree, projections of current technology trends can be made. IT continues to exhibit exponential improvements in price performance. For example, in the mid-1980s, a cell phone cost $5,000.Within a few years, cell phones will cost $10 (see Exhibit 1).

Exhibit 1

exhibit-1-The Future of Healthcare IT

However, projections based on inertia are subject to periodic technology dislocations. The IBM mainframes of the 1960s, networked personal computer of the 1980s, and the Internet of the late 1990s effected major transformations of the technology landscape. These technologies were not simply the result of progressive (although substantial) improvements in IT. Exhibit 2 shows some examples (although you may have to be at least 50 years old to appreciate this figure).

Exhibit 2

exhibit-2-The Future of Healthcare IT

To a degree, predictions of the healthcare environment can be made. For example, despite efforts to control the costs of health care, we can predict that health care will consume 20 percent of the country's gross domestic product by 2013 (Deloitte Center for Health Solutions, 2008).

However, these predictions are also subject to periodic dislocations. The introduction of Medicare in the 1960s significantly altered the healthcare coverage landscape. The events surrounding 9/11 have led to a sharp increase in concerns surrounding bioterrorism.

The future is a complex mixture of predictable trends, unpredictable dislocations, and interactions between them. How should a healthcare provider's IT strategy prepare for this future, given the expected changes in IT and healthcare landscapes and those we cannot yet anticipate? Careful consideration of emerging trends in healthcare IT, such as the growing importance of electronic health records (EHRs), business intelligence, customer relationship management, and clinical decision support, provide a basis for developing IT strategies for the future.

Future of IT

The future of IT can be depicted by extrapolating from current trends.

Computer processor power and storage will continue to offer significant gains in price performance. Software developers will take advantage of this computer power by offering more sophisticated applications, just as today's computer games are a far leap from yesterday's Pong. Individuals and companies will leverage data storage gains by amassing larger amounts of video, image, voice, text, and numeric data. A substantial portion of this processor power will be "out there in cyberspace;" accessible by the user but leveraging computers located "somewhere else."

Virtually everyone will have a portable device that provides phone, e-mail, text messaging, global positioning, and Internet access services. Someday, these devices also will support monitoring of health status such as blood pressure, blood sugar levels, and respiratory status.

Very high-speed networks will be available wirelessly in almost all locations and through broadband connections to almost all homes and office buildings. Fifty-four percent of U.S. households have a broadband connection, and this figure is expected to increase to 77 percent by 2012 (Consumer Broadband, Global Penetration Rates and Growth Prospects, Gartner, 2008).

Social networking technologies such as online communities, (e.g., FaceBook), Wikis, and blogs, will become very vibrant and potent contributions to the ways in which people communicate, share information, and transact with each other. Many of these tools will become critical additions to health care. For example, patients with chronic diseases will be able to discuss treatment options with patients who have the same illnesses, and providers will have increased opportunities to discuss care issues with other providers.

There are IT predictions that are less certain, and many of them are so different from IT as we know it that they seem to come from a Star Wars movie. For example, someday, will we all have chips embedded in our bodies that stop disease and reverse aging? Will computers support applications that are "conscious," exhibit real emotions, and have spiritual experiences? It may be that the emerging networked world will effectively lead to the total loss of privacy; on the other hand, networks also may become very capable of enabling individuals and organizations to protect their privacy.

Future of Health Care

A 2005 survey of hospital CEOs (The Future of Health Care, Deloitte, 2005) found most CEOs predicting that healthcare sector change would be evolutionary rather than revolutionary.

Although concerned about operating margins, these CEOs believed that their organizations would maintain a steady, modest bottom line. Efforts to improve the efficiency and effectiveness of areas such as the revenue cycle, combined with overall cost control efforts, would lead to sufficient margins to reinvest in the organization. However, the margins are not generally expected to be significant enough to support more radical transformation.

Pressures to improve, measure, and report care quality, efficiency, and safety will continue. Hospitals will continue to participate in an array of programs designed to improve their quality of care. However, the deliberate process of developing the evidence in evidence-based medicine, and the incorporation of that evidence into quality measures and reimbursement, will mitigate the likelihood of broad-based, radical change in medical care delivery.

Defragmentation of the care system will move slowly. The gradual consolidation of physician groups and the aftermath of several failed efforts to create integrated delivery systems have left the healthcare industry somewhat leery of the promise of "systems of care." The advent of retail store-based care may take pressure off of a shortage of primary care providers, but will not inherently lead to major change in the structure of the healthcare industry.

Against this backdrop of evolutionary change is the potential for more dramatic change (The Future World of Healthcare, Monitor Group, 2005). Health care in the United States could be transformed into a system where individuals assume the majority of financial risk for their care decisions. Armed with personal health records, consumer-directed health plans, and catastrophic care coverage, consumer demand could drive the industry. Another possibility is that government could establish universal coverage, regulate all payment rates, define best practices, and tightly manage medical innovation.

Ramifications for Today's Healthcare IT

The next 10 to 15 years of healthcare IT will be characterized by a combination of evolutionary and difficult-to-predict events and phenomena. It's possible, too, that changes in healthcare IT will be propelled by revolutionary events, such as government takeover of the industry, or by a major technology dislocation (or two).

When faced with highly uncertain futures, it becomes difficult, perhaps even foolish, to develop a plan that assumes a particular future will arrive. Instead, long-term healthcare IT strategies should be based on answers to two questions, as proposed by Michel Benaroch in "Managing Information Technology Investment Risk: A Real Options Perspective" (Journal of Management Information Systems, 2002):

  • Are there common characteristics across most of the futures of health care?
  • What major IT capabilities will be needed to thrive in an industry that has those characteristics?

As an example, one could make several predictions of the future of the economy of the United States in 10 to 15 years. In virtually all of those scenarios, our economy will be increasingly centered on knowledge work. Hence, in virtually all scenarios, a highly educated workforce will be important.

IT strategies should center on defining those capabilities that are important in a wide range of futures (in addition to addressing near-term organizational needs).

Organizations should be hesitant to make commitments to IT capabilities that are relevant in only one future. If, as time moves forward, a specific future appears to be on its way to becoming the certain future, the organization can make necessary commitments.

What IT initiatives are highly likely to be important in a wide range of futures of health care? What can we expect to see in 10 to 15 years?

Answering those questions requires the identification of common characteristics of a range of healthcare futures. Undoubtedly the healthcare environment in the next 10 to 15 years will:

  • Place an emphasis of improving, measuring, and reporting the quality and safety of care
  • Link provider reimbursement to care performance
  • Witness an increase in outpatient care
  • See a continued demand for inpatient care
  • Demand greater levels of patient service
  • Find that patients have increased interest in being equal participants in their care
  • Continue to attempt to constrain healthcare costs
  • Require greater care coordination

Given these common characteristics, there are several major classes of technologies that should form the core of providers' efforts to prepare for the future.

EHRs. It is difficult to imagine a future in which paper medical records will be regarded as an adequate IT strategy. Rather, the future will require the adoption of computerized provider order entry, care documentation, medication administration, and results management.

According to the Institute of Medicine, EHRs should be able to support:

  • Access to a patient's health information
  • Management of test results
  • Order entry and management
  • Clinical decision support
  • Connectivity to other healthcare settings
  • Delivery of information and data to patients Linkage to administrative processes
  • Population health management

Advances in IT user interfaces and application software will enable these EHRs to be "smarter" (i.e., better at anticipating the next user step and delivering the right decision support at the right place and time) and easier to use.

Business intelligence. Business intelligence (BI) refers to the IT platform and associated tools used to gather, provide access to, and analyze data about organization operations and activities. Providers will need to be able to engage in sophisticated analyses of their care quality and costs, operational performance, patient service initiatives, and revenue situation.

BI applications can have an impact on an organization's income statement, through either a reduction in operating costs or an increase in net revenue. In the future, BI technologies also will be an essential component of an organization's efforts to understand and reduce variations in care practices, determine performance relative to care goals established in managed care contracts, support external reporting of quality measures, and assess the adequacy of an organization's efforts to improve service.

BI technologies and strategies will evolve to cope with a larger volume of data (much of it coming from EHRs), provide algorithms that enable more effective identification of patterns among the data, and support the increased sophistication of performance measures. Moreover, BI initiatives will lead to organizational mechanisms to improve the quality of critical pieces of data.

Customer relationship management. Providers should be proactive with their patients (customers), know their needs, and anticipate their needs. Although quality, safety, and efficiency will remain the primary goals of healthcare provider organizations, service will be increasingly important in the future. In support of the focus on service outcome, providers will need to maintain strong relationships with their patients and referring physicians.

The basis for this approach, well known in other industries, is the principle of customer relationship management (CRM). CRM is an organizationwide process that focuses on treating the unique needs of individual customers to increase value for both customers and the organization. CRM aligns organizational processes with customer strategies to build loyalty and increase profits over time.

Successful CRM efforts are strongly linked with an organization's strategy and culture. To remain focused and integrate CRM into a provider's strategy and culture, it is important for the organization to consider all of its customer groups and define the relationships that it wants to maintain with these groups. The recent Deloitte Consulting Consumerism Survey (2008) identified six discrete segments of the overall consumer market, providing a profile of their key characteristics and differences. Each segment presents opportunities and risks for healthcare industry stakeholders. 

Connected care. A broad range of information technologies will need to be implemented that enable care to be delivered to patients at locations other than the hospital or physician office. Connected care encompasses a wide array of applications, including personal health records, remote blood pressure monitoring, wound management, and online second opinions.

Provider organizations should implement four categories of connected care applications:a

  • Applications that support the management of chronic disease by gathering information about a patient's health status, transporting those results to a care provider, and providing the patient with a summary of data, health education information, and the ability to converse with his or her care team
  • e-visits that enable a patient to seek diagnostic and therapeutic advice and ask general health questions of a provider (e.g., online second opinions, structured, guided descriptions of health problems that patients forward to their physicians, interactive mental health consultations, and e-mail exchanges that focus on altering a medication regime)
  • Information and telecommunications technologies that are used to monitor the recovery of patients after hospitalization (for example, cell phone cameras used to take and transmit pictures of postoperative wounds)
  • Personal health records that provide patients with the ability to view data from their medical records and engage in healthcare transactions, such as renewing prescriptions and searching for information related to their health

Clinical decision support. Clinical decision support provides clinicians, staff, patients, and other individuals with knowledge and person-specific information, intelligently filtered or presented at appropriate times, to enhance health and health care. 

Clinical decision support can take many specific forms; examples are electronically alerting a physician of panic lab results, reminding a primary care provider of the need to order a mammogram, checking a medication order for potential drug-drug interactions, tailoring antibiotic orders based on microbiology culture results, and adjusting drug dosage based on a patient's renal function.

In the future, clinical decision support will center on patient care and be expressed through EHR and connected care applications. However, decision support will also be a critical contributor to CRM and other financial and administrative systems. Workflow engines can be used to ensure that outpatient clinic staff are reminded of the managed care contract provisions that surround a patient's visit and optimize the throughput of patients through an array of ancillary tests that need to be performed.

Interorganizational systems. An interorganizational system (IOS) is an information system that is shared by two or more companies. Examples of IOSs include payer-provider transaction exchange, provider-supplier purchasing exchange, and the exchange of patient data between two providers.

The use of these IOSs (some of which will be provided by regional health information organizations) will be the result of targeted initiatives undertaken by organizations that have very specific business goals. These organizations understand that IT and connectivity can advance their strategies, and they are leveraging the IT investments that have been made by their business partners.

Hospitals will exchange patient data with other hospitals and physician practices to support joint clinical programs and coordinated care. Physicians will exchange medication data with pharmacies and pharmacy benefits managers to improve medication management. Medical homes will exchange clinical data with other providers in an effort to improve care and optimized reimbursement.

Developing a 10- to 15-Year Healthcare IT Strategy

No one is capable of accurately predicting the state of health care and IT a decade from now. Trends can be reasonably extrapolated, but wild cards are just that: wild cards. In 1970, few of us would have been able to predict the specific IT innovations that are such an important part of health care today, no matter their level of IT expertise.

Nonetheless, it is very difficult to imagine a future in which EHRs are a bad idea or having the ability to analyze data about organizational performance is a waste of time. It would also be difficult to say that capitalizing on the growth of cell phones to help patients manage their diseases would be a scandalous expenditure of money.

There is no question that today's IT investments will be replaced by superior technology several times in the next 15 years. In addition, there is no question that provider reimbursement will evolve in the next 15 years. The certainty of these changes may lead the organization to comment, "Although we appreciate that these systems are part of our future, why would we invest in the near term if we will have to replace those investments in the future-perhaps several times?"

Although the technology will need to be replaced over time, the organizational competency and skill in leveraging technology investments will endure and become more critical over time. The future may not demand the IT investment per se. It will demand organizational skill in using the investment to improve performance. Acquiring competency and skill takes time and real-life experiences.

One thing is certain: The implementation of the healthcare IT of the future begins today.


John Glaser, PhD, is vice president and CIO for Partners HealthCare and a senior adviser, Deloitte Center for Health Solutions, Boston (jglaser@partners.org).

Tom Foley is a partner, Deloitte Consulting, LLP, and is responsible for the firm's technology integration practice within the healthcare provider sector, Minneapolis (tfoley@deloitte.com).


Footnote

a. Glaser, J., " The Arrival of Connected Health," Journal of Healthcare Information Management, 2008

Publication Date: Saturday, November 01, 2008

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