The ABCs of systemic healthcare reform - Cerner Corporation

most of our healthcare spending relates to chronic conditions, there is a desperate need for incentives to keep people healthy and
out of doctors’ offices and hospitals. We pay for sick care today; in the future, we must add the concept of health care.
Healthcare reform has been attempted in every American generation in the past century, by presidents Roosevelt (both of them),
Truman, Nixon and Clinton. In 2009, we arrive at this point again, this time with a convergence of events, some extra incentive to
get it right. We do believe we can, by leveraging this IT investment, create a systemic change in healthcare, and that change can
drive $500 billion out of the annual cost of healthcare. Rather than baby boomers like me “busting” the system, we can leave
behind a modern, affordable, frictionless, high-quality healthcare system for generations to come.
A great deal needs to be decided in the next two years. Personally, I believe the ABCs are a narrative of the right direction; the
challenge with each step is that we need to articulate the benefits to us as individuals, to physicians, hospitals, healthcare delivery
systems, government, employers, insurance companies—to all who will be involved. There are a lot of stakeholders. What we need
now is a vision for how the new healthcare system serves us as individuals, as families and as communities.
Now is the right time to talk about what we want for future generations. I have presented my version.
Cerner and the Next Decade—Our 2020 Vision
For the better part of three decades, Cerner has grown organically by articulating a vision of a future state for healthcare
organizations and society. As we finish 2009, three major milestones will have been achieved. The first milestone will come
as we finish our first decade of the 21 st century and arrive at the threshold of the second. While this is just a passing of time,
let’s not forget Y2K was a mere 10 years ago. Back then, there was a fear that computers would cease to function as the clock
turned to this new millennium. Now 10 years later, in our 2008 Annual Report, we are describing how and when all of the U.S.
healthcare system will be completely digitized. The first decade has been hard but very good to Cerner and its associates, clients
and shareholders. The next one will change the face of the HIT and the healthcare industry.
The second milestone will be the 30-year anniversary of the moment when Paul, Cliff and I sat together at a picnic table in Kansas
City’s Loose Park, dreaming and planning what type of company to start. We have lived the American Dream. Along the way, we
have also created a lot of jobs—careers for our associates—almost 8,000 high quality, new and ongoing jobs. Today, we are the
largest non-governmental employer on the western side of Missouri. In the next decade, we expect to see a continuation of rapid
growth of jobs inside Cerner. Finally, the third milestone is that the end of the Electronic Medical Record era in the United States
is now in plain sight. By law, we should have a digital healthcare system at some point in the next decade.
This should create the basic question, what is next? If you care to, go back and read the past five to 10 annual reports. We have
already answered this question, and we believe Cerner is as well or better prepared for the next era as any company in healthcare.
Here is a quick review of why we are excited about the coming era.
In 2006 in this letter, we introduced the five-box model that is
still our blueprint for this next decade. By way of refresher, the
center box is the U.S. healthcare market, a $2.3 trillion market
with healthy compound annual growth rates that will cause it to
double by 2019. The second box represents the global markets
for digitizing healthcare delivery, where we have clients in more
than 25 countries on six continents. The third box represents
the medical device industry, which will increasingly become a
part of the HIT industry. The fourth box is the Pharma industry,
where the transparency created by a digital healthcare system will
fundamentally change the discovery of new knowledge, the ways
to design and conduct clinical trials and surveillance systems for
medicines in active use. Finally, a fifth box holds the opportunity
to completely redesign the fundamental commerce of healthcare,
eliminating the friction that consumes more than 30% of precious
resources, connecting governments, employers and consumers
directly with their healthcare professionals, facilitating the whole
process based on personalized needs of the individual.
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