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CONTENTS EXECUTIVE INSIGHT ı 2013 ı august 

Cover 

Story 

12 

Answering the Call 

for Optimization 

Your lab is one area that can help drive ACO success. 

By Jonathon Northover, JD, BVC (ICSL), and 

James Carson, PhD, MBA, MLS(ASCP) 

16 CEO: ACO Lessons Learned 

Here’s how Brevard Physicians Network 

moved from planning for an accountable 

care organization to taking action. 

By Brenda Radke 

19 COO: Organizational 

Efficiencies of ACOs 

Expected—and unexpected— 

outcomes are revealed. 

By Robert Fortini, RN, PNP, 

and Richard Hodach, MD, MPH, PhD 

21 CFO: Strategies to Identify 

the ROI of an ACO 

With the right model, your patient 

population can grow, and your 

organization can prosper. 

By James L. Starr and Richard Jones 

25 CIO: An Enhanced IT Portfolio 

for a New Model of Care 

How Virtua is turning data into ‘intelligence.’ 

By Alfred Campanella 

Features 

28 The Executive Handbook to 

Radiology Department Improvements 

The application of intelligent informatics and 

workflow management solutions could wed 

efficiency, quality and value. 

By Claudine Martin 

Peer-Reviewed 

31 Cost Implications of VAP 

An equation developed by Johns Hopkins helps 

administrators quantify potential savings by 

reducing hospital-acquired infections. 

By Gail O. Guterl 

31 


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contents continued EXECUTIVE INSIGHT ı 2013 ı august 

Features 

33 Success With Mobile Medicine 

Kearney Clinic improves clinician efficiency 

and patient care with voice-enabled, 

mobile dictation. 

By Steve Jensen 

35 Operational Cost Creep 

Consistent inventory management is 

critical to avoid unnecessary expenses. 

By Michael Jones 

37 The Successful LIS Demo 

Time investment and due diligence 

upfront will pay off. 

By Lisa-Jean Clifford 

39 Building a Bulletproof 

Revenue Cycle 

Time to raise the bar and drive continuous 

improvement to stay ahead of challenges. 

By Patrick Campbell 

41 Reimagining Patient Care 

Telemedicine brings patients and 

providers together. 

By Wendy Deibert 

Online Content 

www.advanceweb.com/executiveinsight 

Features 

WELCOME 

Executive Insight welcomes executives 

from long-term care and radiology to our site. 

➤ 

➤ 

➤ 

Solutions Survey 

Let us know your biggest healthcare challenges 

this year in our annual Solutions 

Survey. 

Directions in Analytics: 

Connecting the Divide 

Between Inpatient and 

Outpatient Care 

A comprehensive practice platform blends 

evidence-based tools with team competency 

and compassion. 

mHealth: How Mobilization 

Can Truly Transform Healthcare 

The healthcare industry has barely tapped 

mHealth’s potential to improve health and 

lower costs. 

41 

Departments 

8 Editorial 

ACO Still a Buzz? 

Columns 

n ASQ’s Eye on Quality 

n CHIME’s Healthcare IT 

n MGMA’s Directions in 

Group Practice Management 

n Dollars & Sense, sponsored 

by Soyring Consulting 

n Executive Perspectives for the 

Continuum of Care, sponsored 

by Status Solutions 

n Next Level of Leadership 

sponsored by Caliper 

n Finance & Investment 

n mHealth, 

sponsored by AT&T 

n The Efficient Emergency 

Department, sponsored 

by Wellsoft Corp. 

Blogs 

n Politics of Healthcare 

n Boardroom Buzz 

Check back daily for news updates, blog discussions and product information. 

10 Healthcare IT 

Will Post-Acute Sites Ever 

See Meaningful Use? 

On the Web 

Looking for a new job? Now you can 

get job postings on Facebook and 

Twitter! Follow us at www.twitter. 

com/AdvanceHCAJobs and www.facebook.com/ExecutiveInsight 

to search 

for healthcare administration jobs. 

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Merion Matters. 

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Horizon Drive, Box 61556, King of Prussia, PA 19406-0956. 

Executive Insight delivers innovative strategies and solutions by 

and for healthcare executives to help them lead and succeed. 

This national print and 24/7 online resource offers our community 

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7

editorial 

By Lynn Nace 

ACO Still a Buzz? 

You betcha. In the world of healthcare 

reform, it doesn’t take much 

to identify that the move toward 

accountable care organization (ACO) is 

a trend still in its infancy. In fact, in a recent 

CHIME/EMC survey, “Health Check: 

Healthcare CIOs Prescribe Change,” it was 

revealed that currently 17% of respondents 

said they are part of an ACO (which is up 

by about 15% from nearly 2 years ago), and 

37% said they expect to be part of one in 

the next 3 years. 

What stage is your hospital in? This issue 

of Executive Insight explores lessons 

learned, expected—and perhaps more importantly, 

unexpected—outcomes, strategies 

to identify the return on investment 

(yes, this is possible!), and “next steps” to 

improve patient care. Not only are some 

of the executives contributing to this issue 

“there” when it comes to ACO participation, 

but they’re actually taking various 

measures a step further by identifying 

even more sophisticated technologies— 

business and clinical intelligence tools— 

that are allowing them to pre-determine 

gaps in patient care and predict when 

medical attention is needed to avoided a 

readmission or more costly care. 

Executive Insight also takes our ACO 

coverage a step further by offering a dedicated 

ACO Resource Center, sponsored 

by Beckman Coulter, that includes webinars, 

interviews, articles and daily news 

that’s updated daily to provide you with 

up-to-the-minute content related to this 

dynamic environment. There you’ll find, 

for example, “ACOs Take a Leap of Faith,” 

In the world of healthcare 

reform, it doesn’t take 

much to identify that the 

move toward accountable 

care organization 

(ACO) is a trend still in its 

infancy. 

in which Richard J. Gilfillan, MD, director 

of the Center for Medicare and Medicaid 

Innovation, notes, “The transition to 

ACOs will affect many segments of industry 

within healthcare and throughout the 

U.S. economy. Those companies already 

heavily invested in healthcare may need a 

new way of envisioning solutions. So you 

might find people interested in creating 

radiology machines thinking differently or 

you might find people building software or 

hardware that realize they need to change 

the way they are thinking about the future.” 

How is your hospital thinking differently? 

Visit our ACO Resource Center 

at www.advanceweb. 

com/executiveinsightaco 

On the Web 

Visit our ACO Resource Center at www.advanceweb.com/executiveinsightaco 

Lynn Nace 

Publisher 

is published by Merion Matters 

Publishers of leading healthcare magazines since 1985 

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Joshua Adler, MD 

CMO, UCSF Medical Center 

San Francisco, CA 

Allen Butcher 

CFO, 

Camden Clark Memorial Hospital 

Parkersburg, WV 

Edmund E. Collins, MBA, CPHIMS 

Vice President and CIO 

Martin Memorial Health Systems 

Stuart, FL 

Frank Corvino 

President and CEO 

Greenwich Hospital 

Greenwich, CT 

Susan L. Davis, EdD, RN 

President and CEO, 

St. Vincent’s Medical Center/ 

St. Vincent’s Health Services 

Bridgeport, CT 

Cole Edmonson, DNP, RN, FACHE, NEA-BC 

Vice President, 

Patient Care Services and CNO 

Texas Health Presbyterian Hospital 

Dallas, TX 

Neal Ganguly, CHCIO, FHIMSS 

Vice President and CIO 

CentraState Healthcare System 

Freehold, NJ 

Johnny Kuo 

COO, Gracie Square Hospital 

New York, NY 

Hitachi Medical Systems 

America Inc. 

www.hitachimed.com 3 

Ed Marx 

Senior Vice President and CIO 

Texas Health Resources 

Arlington, TX 

InterSystems Corporation www.InterSystems.com/Key10EIN 2 

McKesson Information Solutions www.mynewHIS.com 17 

MSA Executive Search www.MSAsearch.com 11 

ResMed www.ResMed.com/COPD 7 

South Carolina Medical Group 

Management Association 

Industry advisory board members 

www.scmgma.com 42 

Sprint Nextel Systems www.sprint.com/hospitalsolutions 44 

Dan Morissette 

CFO, Stanford Hospital & Clinics 

Palo Alto, CA 

Lynne Myers 


Agrace HospiceCare 

Madison, WI 

Lisa Rowen, DNSc, RN, FAAN 

CNO and Senior Vice President of Patient Care 

Services, 

University of Maryland Medical Center 

Baltimore, MD 

Amir Dan Rubin 


Stanford Hospitals and Clinics 

Stanford, CA 

Sue Schade, FCHIME, FHIMSS 

CIO, University of 

Michigan Hospitals 

and Health Centers 

Ann Arbor, MI 

Casey Cram, MA 

Director of Marketing, 

Talyst 

Bellevue, WA 

www.talyst.com 

Nancy M. Falls 

National Managing Partner 

Healthcare 

Managing Partner Nashville 

Tatum 

Brentwood, TN 

www.TatumLLC.com 

Amy Jeffs 

Chief Operating Officer, 

Status Solutions 

Charlottesville, VA 

www.statussolutions.com 

Ken Perez 

Senior Vice President 

of Marketing and Director 

of Healthcare Policy 

MedeAnalytics 

Emeryville, CA 

www.medeanalytics.com 

Christine Ricci, RN, BSN, MBA 

Chief Marketing Officer, 

B. E. Smith, Inc. 

Lenexa, KS 

www.besmith.com 

Christine Schuster, MBA, RN 


Emerson Health System 

Concord, MA 

Nancy Templin, CPA 

CFO, All Children’s Hospital, 

St. Petersburg, FL 

Deborah Zastocki, 

EdM, DNP, CNAA, NEA-BC, FACHE 


Chilton Memorial Hospital 

Pompton Plains, NJ 


9

Healthcare IT 

By Cara Babachicos, MHA, CHCIO 

Will Post-Acute Sites 

Ever See Meaningful Use? 

When I speak with my acute care colleagues, 

they are often surprised to learn 

that meaningful use (EHR incentives) 

doesn’t include the post-acute sector. Some think 

it’s strange that meaningful use (MU) doesn’t consider 

electronic health records (EHR) systems for 

rehabilitation, long term care and psychiatric hospitals, 

home care, hospice or nursing homes, while 

these facilities care for some of our sickest patients. 

Successful care transitions from acute to postacute 

are predicated on effective communication 

and coordination of the treatment plan with the 

next care provider. In facilities lacking the proper 

electronic coordination systems, a patient may be 

transported from the acute care facility to a postacute 

setting on a stretcher with a paper medical 

record attached to their jonnie, while they await 

an admissions person on the other side. This is by 

no means a well-coordinated transition. 

Keeping Pace 

With the focus on cutting cost and improving 

quality, it puts a healthcare provider at a huge 

disadvantage if they cannot keep up with the 

communication and documentation systems in 

place at the referring hospitals, not to mention 

the fact that they put themselves at a huge disadvantage 

in the Accountable Care Organization 

(ACO) marketplace. It is equally challenging for 

post-acute to afford this technology when they 

are significantly impacted by rate cuts. 

Some organizations like mine have made the 

investment in technology for post-acute, but other 

facilities are light years away. I worry about the 

many organizations that haven’t kept pace with 

technology because the lack of standardization 

and coordination of care will ultimately impact 

how healthcare is delivered. As a healthcare CIO, 

I know that MU and EHRs are by no means a 

panacea, but lack thereof could be a game changer 

for a patient if a significant note, medication 

order, or a specialist consult is missed in the coordination 

of care across the continuum. 

Some have suggested that a HIE would solve 

this problem, but without an electronic system 

at the receiving site it would be very difficult to 

have two-way sharing of patient data. The inefficiencies 

of rekeying the information from a 

paper chart would be time consuming and burdensome, 

and a secondary process outside of the 

clinician workflow. In addition, scanned documents 

can have much variation. 

Regulatory Issues 

Maybe the key to integration with acute care is 

regulatory simplification? At present post-acute 

care requires different clinical documents and 

billing codes than acute care. FIM, MDS, HHRG, 

IRF-PAI are some of the terms you quickly become 

familiar with in the post-acute world. By 

simplifying and standardizing coding and documentation 

for post-acute it would make it far 

easier to extend the acute care products to the 

post-acute settings. Post- acute looks forward to 

the day that there will be a common care tool, but 

at present the post-acute settings use different 

clinical documentation coding and billing mechanisms, 

making it difficult to even share tools/ 

systems across post-acute. If we were to move 

away from the specialty codes and to a common 

care tool across all levels of care it would not only 

simplify the implementation of systems for postacute, 

but it would also allow organizations to 

truly understand the total cost and the quality of 

care delivery across the continuum. 

Predictions 

Will MU ever see the light of day in post-acute? 

Some are skeptical and have suggested that the 

MU dollars would be exhausted before it gets to 

post-acute sector. Others suggest that we will 

see some incentives in MU stage 3. I’m inclined 

Cara Babachicos is the CIO/corporate director of Community and Non Acute Sites at Partners Healthcare System. 

As a healthcare 

CIO, I know that 

MU and EHRs are 

by no means a 

panacea, but lack 

thereof could be 

a game changer 

for a patient if a 

significant note, 

medication order, 

or a specialist 

consult is missed 

in the coordination 

of care across 

the continuum. 

Healthcare IT is sponsored by 

the College of Health Information 

Management Executives 

(CHIME). Contact CHIME at www. 

cio-chime.com 


Healthcare IT 

If we were to move away from the specialty codes and to a common care tool 

across all levels of care it would not only simplify the implementation of systems 

for post-acute, but it would allow organizations to truly understand the total cost 

and the quality of care delivery across the continuum. 

to believe that there will be limited dollars for transition of care in 

stage 3, but for the most part the MU package for post-acute will 

not resemble the level of sophistication of acute care. Rather, what 

may happen is that larger healthcare systems wanting a full continuum 

of care will buy or partner with post-acute services and they 

will subsidize the cost to bring the systems up to par for interoperability. 

However, this is worrisome because it will leave behind a 

large percentage of facilities that will continue to exist and care for 

the public as stand-alone facilities. The general public may not understand 

the variation but the educated surely will. This could be 

the reality if there are no incentives or regulations that standardize 

how all of our healthcare provider will operate in the new world. 

The MU road has been difficult and costly for acute care; however, 

we understand that it may help to reduce variations in care and improve/monitor 

quality. We will not solve some of these challenges 

in the near future, but as care providers and patients we should demand 

that all aspects of our system are talking to one another, sharing 

key clinical data, and using systems that will reduce patient risk. 

If we are looking at trying to care for the patients holistically across 

the continuum we will need to address the obvious lack of attention 

to technology in the post-acute sector. Simply put: Healthcare is a 

chain of providers across numerous care settings, and as the proverb 

says, “The strength of the chain is in the weakest link.” 

On the Web 

Be sure to review our archived Healthcare IT content at 

www.advanceweb.com/executiveinsight 

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11


Healthcare is evolving faster now than ever in response 

to a number of powerful forces. These include HI- 

TECH, Meaningful Use, big data, decreasing costs 

and increasing availability of personalized medicine, and 

EMR adoption. However, most significant is the creation 

of Accountable Care Organizations (ACO) under the Affordable 

Care Act, and the significant shift, practically and 

culturally, from volume to value. 

If the financial outcome under the fee for service model 

keeps patients in the hospital, then they will be kept out 

under the ACO model. While ACOs do not remove fees 

for services, they do create savings incentives to motivate 

volunteer organizations to meet specific quality benchmarks 

which demonstrate that they have saved healthcare 

dollars, and ultimately improved 

patient care. 

One problem, however, is that 

while volume is easy to measure 

(the more you do, the more you 

get paid), proving value with 

quality metrics is more difficult. 

And when trying to predict outcomes 

(e.g., keeping patients out 

of the hospital) the difficulty only increases. 

So how can the clinical laboratory contribute to this 

new challenging environment? The fact that it is the production 

engine and custodian of vast amounts of test 

result data that is relied upon for over 70% of diagnoses 

by some measures, is insufficient. 

The key to the laboratory fulfilling 

its potential, and enabling the ACO 

to fulfill its potential, lies in understanding 

how to interpret 

and apply its 

data in a strategically 

meaningful way. 

Three specific areas 

The laboratory cannot become a 

data enabler in a meaningful way 

for the ACO unless it becomes a 

data partner with all of the other relevant 

and willing moving parts. 

it can support to achieve this are test ordering guidance, 

admissions and discharges and pharmacy. 

Test Ordering Guidance 

The test ordering process is one initial area upon which 

the laboratory can have a significant impact. Under the 

ACO model, we must unite a disparate network of physicians 

on the one hand, and the need for first-time accuracy 

of testing and rapid turn-around time on the other. With 

rapidly expanding test menus, particularly in molecular 

diagnostics, it is unrealistic for physicians to know all of 

the recommended ordering practices. Inevitably, the ordering 

of old tests when new ones are available, the ordering 

of new tests to a “‘panel”’ without replacing one in 

that panel or the ordering of tests 

useful for research but not necessarily 

in diagnosis, are all risks 

to ACO success. 

Just as pharmacists influence 

physicians’ drug ordering, the lab 

can make a difference in test ordering 

to pre-empt such potential 

issues. One currently uncommon 

method is to create a lab test formulary. When offered tests 

are presented to the physician as formulary products, some 

may require pathology review, some infectious disease review, 

and even for some, chief medical officer review, before 

being approved. Such an approach also aligns well with 

broader industry efforts such as the 

American Board of Internal Medicine’s 

“Choose Wisely” campaign 

which that focuses on encouraging 

stakeholders to address 

tests and procedures 

that may be 

unnecessary. 1 Even 

without required 

By Jonathon Northover, JD, BVC (ICSL), and 

James Carson, PhD, MBA, MLS(ASCP) 

scott frymoyer 


13

cover story 

Jonathon Northover, 

JD, BVC (ICSL), is 

a product manager 

at Sunquest Information 

Systems, a 

global Laboratory 

Information Systems provider headquartered 

in Tucson, Arizona. 

James Carson, PhD, 

MBA, MLS(ASCP)cm 

is a consultant, founder 

and senior partner 

with Adept Clinical 

Consultants Team in 

Spokane, Washington and chief business 

and strategic officer with GoPath Laboratories 

in Buffalo Grove, Illinois. 

review steps, the formulary offers “thought” guidance and directed 

assistance when needed. 

Another method is to ensure that the laboratory is supported with 

business intelligence (BI) tools that alert the ACO, for example, to ‘outlier’ 

physician practices that are ordering large numbers of CBCs, of 

which a high average proportion are normal. The ACO can then carry 

out a root cause analysis to reduce the unnecessary ordering, which of 

course is not only relevant to the lab and its health system, but payers 

also want this information, as do the physicians themselves. 

Business intelligence (BI) tools also enable the calculation of cost 

per diagnosis as opposed to the cost per test – inextricably linked to 

value, not volume, in synchronization with ACO goals. Test ordering 

variation reduction can also be pursued by reviewing ordering 

pattern costs compared to patient outcomes. Taking the ‘BI’ thought 

a step further, with the right data integration and creation of industry 

best practices for test ordering, the laboratory can provide benchmarking 

to the ACO that can be extremely valuable for its purpose. 

Admissions and Discharges 

As part of the Affordable Care Act, reimbursements are cut under 

a cost containment rule if patients are re-admitted within thirty 

30 days of being discharged, when national averages for certain 

conditions are considered. While cutting the re-admission rate 

can be beyond the control of the hospital when managing very sick 

patients, there are circumstances in which the laboratory can contribute 

to a readmission reduction. 

Firstly on the admission side, protocols can be developed based 

on the patient’s anticipated diagnosis that help distinguish a more 

accurate determination of whether they need to be admitted in the 

first place, and outpatient testing can provide data to support the 

decision as to whether ambulatory or inpatient treatment is best. 

Strategies and Solutions for Healthcare Leaders 

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14 ADVANCE for Executive Insight 

7/12/13 12:17 PM

Secondly, on the discharge side, a battery of tests can be run following 

treatment to determine whether they really should be discharged. 

The laboratory is in a strong position to support the key 

strategy of lower re-admission rates for aspiring ACOs. 

Pharmacy 

In certain cases, that are only set to increase, laboratory data from 

molecular and related testing can guide the appropriate choice of 

medication to prescribe and administer to the patient. Perhaps the 

biggest challenge, and opportunity, in an ACO environment, is the 

ability of the health system to stitch together disparate data sets, 

ensure standardization, and then share that data with all interested 

parties. However, assuming this interoperability challenge can be 

overcome, the potential impact on bringing down the massive costs 

relating to wrongly prescribed medicine could be significant, and 

the laboratory extends its reach on behalf of the ACO even further. 

Summary 

The potential for the lab to become a vital strategic asset to an ACO 

is clear and required. Its immediate impact could be in physician ordering 

practices, re-admission and discharge control, or supporting 

best pharmaceutical practices to reduce prescription costs. We are 

already seeing early examples of some success in these areas. 

However, as much as the potential is clear, the need for a cultural 

shift is also clear. The laboratory cannot become a data enabler in a 

meaningful way for the ACO unless it becomes a data partner with all 

of the other relevant and willing moving parts. This includes the physicians, 

the pathologists, the hospital administration and of course 

the patients. Assuming that coordination is well managed and committed 

to by all, the laboratory will truly drive the positive impact that 

ACO-led coordinated care was intended to provide. 

Reference 

See: http://www.ascp.org/Newsroom/ASCP-Joins-Campaign-to-Improve-Use-of- 

Medical-Tests.html; other examples include: http://www.mayomedicallaboratories.com/articles/administrator-tools/index.html 

http://www.aruplab.com/UtilizationManagement/ARUPATOP/index.jsp 

On the Web 

For additional, timely ACO content, visit our ACO Resource 

Center at www.advanceweb.com/executiveinsightaco 

Enhancing Commitment to 

Quality in Your Hospital 

The first and only Joint Commission-accredited 

provider of inpatient kidney care and apheresis therapies*, 

DaVita® sets the quality standard for inpatient kidney care. 

By choosing DaVita as your hospital’s accredited provider, 

you can feel confident that your kidney care patients are 

receiving superior quality care. 

To learn more about how partnering with DaVita can help your hospital 

improve quality and patient safety, email us at hospitals@davita.com 

or visit DaVita.com/JointCommission. 

* Ambulatory Health Care Accreditation was based on a survey of 177 DaVita acute programs, which included Joint Commission-accredited hospitals and other hospitals permitting 

Joint Commission access for purposes of the survey process (a limited number of hospitals did not permit access). 

© 2013 DaVita HealthCare Partners Inc. All rights reserved. 06744-01-DHSG-TJC 


15

CEO perspective 

It is essential to quickly move from the 

phase of contemplating change to actually 

being willing to take action. 

Brenda Radke is CEO of 

Brevard Physicians Network 

in Melbourne, Florida. 

Today’s dynamic industry environment is offering 

a variety of exciting opportunities for 

providers who want to take charge of their 

own destiny. While many provider groups have 

decided to wait until the “right time” to move 

away from fee-for-service and into the world of 

value-based care, other entities are moving swiftly 

into this unchartered territory. As a result, 

these organizations are benefiting from an entrepreneurial 

environment where collaboration and 

openness to new ideas are driving real change. 

As the CEO of Brevard Physicians Network 

(BPN), who formed a second division called 

Medical Practitioners for Affordable Care 

(MPAC) – an early adopter of the ACO model, 

I have experienced these opportunities firsthand, 

along with the challenges that come with blazing 

new trails. As a result of this experience, I have 

become a passionate advocate for the cause, encouraging 

providers to take control of their financial 

future and make a bold leap into the world of 

accountable care. 

ACO Lessons 

Learned 

Here’s how Brevard Physicians Network moved 

from planning for an accountable care organization 

to taking action. By Brenda Radke 

Creating a Culture 

That Embraces Change 

I was fortunate to be part of an organization that 

was willing to invest in this transformation and 

promote an environment of innovation and accountability. 

However, there were still significant 

strides to make in building trust among our providers 

and developing consensus for our cause. 

To address this issue, leaders carefully selected 

physician “champions” who shared our vision and 

determination to lead change rather than waiting 

to follow the market. These individuals were 

well-respected among their peers and served as 

bridges between clinical and non-clinical leaders. 

MPAC also implemented frequent physician 

forums to drive two-way communication and 

lead change management efforts. We learned 

from both the advocates of value-based care as 

well as its critics and we refined our approach in 

response to this feedback. As a result, we were 

able to make strides in getting physicians on 

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17

CEO perspective 

While many provider groups have decided to 

wait until the “right time” to move away from 

fee-for-service and into the world of value-based 

care, other entities are moving swiftly into this 

unchartered territory. 

board and excited about this process. 

On the Web 

Visit our comprehensive 

ACO resource center, 

including news, articles 

and multimedia. Go to 

www.advanceweb.com/ 

executiveinsight and 

click on ACOs under 

“Resource Centers.” 

Moving Quickly into Action 

While BPN had some experience in quality 

improvement and cost containment through 

shared savings models and a Medicaid HMO, 

the transformation to an early adopter ACO was 

a significant step. No amount of strategic planning 

could completely prepare us for the changes 

ahead. Fortunately, our board believed that this 

transition was inevitable and was very supportive 

of our efforts to take a leap of faith into this 

unchartered territory. 

As your organization considers its approach, 

there will likely be a great deal of planning, financial 

modeling and analysis. While this is a crucial 

step, many organizations may become stuck in 

this phase and unwilling to proceed into an uncertain 

environment. That’s why it is essential to 

quickly move from the phase of contemplating 

change to actually being willing to take action, 

whether it is through a small pilot program or a 

full ACO model. 

Building a Technology 

Infrastructure 

To get to a true jumping-off point, organizations 

should transition to a shared technology platform 

that supports a team-based approach to 

care as well as improved clinical decision-making. 

At BPN and MPAC, we chose a global 

solution that could support all of our needs for 

clinical analytics, financial analytics, referrals, 

authorizations, customized reporting and patient/provider 

portals. 

Without this flexible and robust system, we 

could not have successfully transformed our 

business processes to achieve the triple aim of 

health reform — better care, reduced costs and 

an enhanced patient experience. By connecting 

physicians with meaningful insight at the point 

of care, including targeted patient data and evidence-based 

clinical practices, we empowered 

providers to improve outcomes. At the population 

level, this system also offered real-time data 

that allowed us to develop targeted care management 

and patient engagement strategies. 

Offsetting Investments 

Through Strategic Partnerships 

Many organizations may struggle with the resources 

and financial investments necessary 

to make accountable care a reality. Fortunately, 

strategies can help offset these investments. 

Many payers are motivated to partner with providers 

to build the infrastructure needed to support 

quality-based improvements. For example, 

BPN initially explored a shared savings model 

through a payer partnership before moving into 

a full ACO model. This allowed us to begin exploring 

the realm of value-based care while benefiting 

from financial incentives and support. 

My career has included leadership roles in 

both the payer and provider sides of the industry. 

I strongly believe that the success of these new 

models will depend heavily on whether these 

parties can come to the table to develop strategies 

that improve patient care and better manage 

costs while maintaining mutual profitability. 

The Time for Change is Now 

Based on my experience, there is no perfect time 

to pursue accountable care. If leaders and clinicians 

are willing to make the transition, there is 

no reason to delay the process. In fact, organizations 

that take bold steps toward value-based 

care today will be rewarded with growth opportunities 

and the ability to have a seat at the table 

with other innovative market leaders that are 

crafting the future of healthcare delivery. 


cOo perspective 

Organizational 

Efficiencies of ACOs 

Expected—and unexpected—outcomes are revealed. 

By Robert Fortini, RN, PNP, and Richard Hodach, MD, MPH, PhD 

For traditional health systems and physician 

groups, embracing the Accountable 

Care Organization (ACO) model is no easy 

matter. After decades under fee-for-service, the 

ACO’s approach to profiting through shared savings 

requires traditional institutions to perform 

a 180-degree turn in mindset and practice. Even 

with a strong commitment to the ACO goals of 

higher quality, lower costs and greater patient 

satisfaction, it’s still a tough slog. 

With that in mind, it’s worthwhile to ask of 

those who have succeeded with an ACO, “Has 

it been worth the effort? Have you achieved the 

promised efficiencies? Have the changes enabled 

stronger collaboration among healthcare stakeholders? 

Were there unexpected benefits?” 

ACO Entrance 

Bon Secours Virginia Medical Group was a 

relatively early entrant into the ACO market. 

A participant in the Medicare Shared Savings 

Program, the hospital-owned, multi-specialty 

group practice with more than 400 providers 

across metropolitan Richmond, Va., inked value-based 

contracts with CIGNA and Anthem in 

2012. CIGNA gives Bon Secours a per-member 

per-month (PMPM) adjustment for care coordination. 

Anthem pays a care coordination 

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19

fee and will change to PMPM in the coming year. 

Several more commercial payers are waiting in 

the wings. 

Bon Secours’ transformation into a budding 

ACO is the result of a systematic strategy to 

reengineer primary care practices, embrace 

population health management, integrate new 

technologies into care team workflows and encOo 

perspective 

The 30-day readmission rate in Bon Secours’ 

medical home practices has been 

consistently under 2% for two years. 

Robert Fortini, RN, PNP, is 

vice president and chief clinical 

officer of Bon Secours 

Virginia Medical Group. 

Richard Hodach, MD, MPH, 

PhD, is chief medical officer 

of Phytel. 

gage patients in their care. Steps in this strategy 

included: 

n Enterprise-wide EMR implementation 

n Commitment to the Patient Centered Medical 

Home (PCMH) delivery model 

n Implementation of registries to identify high-risk 

patients and gaps in care 

n Embedding “nurse navigator” care managers 

into primary care teams 

n Automation of resource-intensive care management 

and patient engagement initiatives 

n Adoption of advanced quality and reporting tools 

On the Web 

For additional ACO 

content and materials, 

visit our special ACO 

Resource Center at www. 

advanceweb.com/executiveinsightaco 

The PCMH Model 

From the beginning, the group saw the PCMH 

model as the backbone of the ACO. Medical 

home designation verifies the presence of EHR 

tools, patient access policies, and quality programs. 

To date, Bon Secours has secured NCQA 

Level 3 status at 11 of its 40 primary care sites, 

with the remainder on target for certification in 

18 months. To optimize the value of PCMH, Bon 

Secours implemented an IT infrastructure that 

included not only a networked EHR but the ability 

to collect, store and manage data to identify 

gaps in care, follow patients across sites of care, 

monitor and stratify patients based on risk, produce 

actionable reports for each physician panel, 

and automate patient outreach. 

A key task of any ACO’s IT system is to identify 

the highest cost/highest risk patients. On 

average, 67% of patients who are deemed “catastrophic” 

in any given year were not catastrophic 

the year before. Identifying these patients at an 

earlier stage and intervening to slow or prevent 

the progression of their illness is the most important 

task of an ACO. Bon Secours uses customized 

disease registries and hospital discharge 

data provided by CIGNA to find high-risk patients. 

It then feeds the information to embedded 

RN case managers, or nurse navigators, as 

well as remote care managers – all tasked with 

contacting high-risk patients such as those disthinkstock/istockphoto 


charged within the last 24 hours. 

The approach has worked: The 30-day readmission rate in Bon 

Secours’ medical home practices has been consistently under 2% 

for two years. In the first six months of its CIGNA contract, readmissions 

fell 27%, shaving $1.8 million off their projected spend. 

The organization needs to improve gap-in-care metrics only 

slightly to qualify for a projected $4 million in annual gain sharing 

with CIGNA. 

Unexpected Results 

While these efficiencies were in line with expectations, Bon Secours 

was surprised by one unexpected result: The group could not 

afford to hire enough care managers to track, monitor, contact and 

intervene with every patient who needed help. So it deployed technology 

(Phytel) to conduct patient outreach via automated phone 

calls, emails and text messages. These coordinated campaigns 

identify non-compliant patients with common chronic conditions 

and invite them to see their primary care provider. During the first 

year of its CIGNA contract, Bon Secours used automation to make 

over 300,000 phone calls, resulting in nearly 40,000 scheduled patient 

visits. 

Another unexpected benefit has been greater patient satisfaction. 

Last year, Bon Secours’ Gallup patient engagement scores (the 

CE11) were in the 97th percentile. Staff satisfaction has also risen, 

especially among physicians who were opposed to the PCMH model 

in the beginning, fearing it would add work without benefit. That 

changed once they discovered that the new sets of tools: 

n make their work more rewarding, 

n improves patient outcomes, 

n allows them to focus on complex medical decision-making, and 

n builds more effective relationships with their patients. 

But perhaps the most meaningful unexpected efficiency to come 

of Bon Secours’ ACO experience has been its ability to profit in today’s 

fee-for-service world while laying the foundation for success 

under value-based purchasing. By utilizing automation and technology 

to identify non-compliant patients and bring them in for 

chronic and recommended care, Bon Secours has improved quality 

and generated more than $7 million in fee-for-service revenue, with 

a return on investment on their technology spend of 16.6. 

Challenges to Overcome 

Despite Bon Secours’ success with its ACOs, challenges remain. A 

successful ACO requires population health capabilities including 

automated care management tools that eliminate variation, increase 

patient engagement, and improve care coordination. These 

systems must be able to manage multiple programs with different 

payers. Today, Bon Secours’ nurse navigators must access three databases 

– Epic, Cigna, and Anthem – to gather all the data needed 

to perform their jobs. They face further difficulties in attributing 

populations to each payer and in managing different rules to define 

these risk-based populations. This problem will only be magnified 

with multiple additional payers. Anticipating a logjam, Bon 

Secours is evaluating registry solutions that will let it manage all 

conditions, disease states and payer programs from one location. 

Health systems that experiment with risk-based contracting 

and ACOs will continue to find new solutions to these very new 

problems. They would do well to remember a renowned analytical 

approach to data known as the “wisdom hierarchy.” With repeated 

analysis over time, the model states, data becomes information, 

which becomes knowledge, which begets wisdom. We are all 

struggling to operationalize electronic systems and leverage data 

to determine how to provide better care more cost effectively. We 

have a lot of maturing yet to do, but it is reassuring to know we are 

clearly making progress along the wisdom path. 

cFo perspective 

Strategies to Identify 

the ROI of an ACO 

With the right model, your patient population 

can grow, and your organization can prosper. 

By James L. Starr and Richard Jones 

A 

new business model is now being embraced 

by the U.S. healthcare system. 

Accountable care – in which ROI is 

measured not by the volume but the value of 

services, plus an organization’s ability to meet 

the goals of the Triple Aim – is transforming 

the industry. 

This new model requires a relentless focus on 

the right balance of cost, quality and satisfaction. 

Failure to respond to the opportunity represents 

a major risk as market pressures intensify. The 

shift to accountable care requires a strategic 


21

CFO perspective 

James L. Starr is CFO, 

Lumeris, and Richard Jones 

is president and CEO, 

Essence Healthcare. 

In this emerging model, costs matter. But, 

long-term clinical results will matter more, 

because they are the key to lower costs. 

right by enabling value-driven decisions that 

have the right infrastructure, technology, patient-centric 

programs, and incentives to deliver 

high-quality, cost-effective care to your 

chosen population across the entire continuum 

of care. 

It is now recognized that the volume-driven, 

fee-for-service model is unsustainable. U.S. 

healthcare spending stands at $2.7 trillion. Our 

per capita spending – $8,500 per person every 

year – outstrips that of any other nation. The 

ROI is dismal: On average, Americans die sooner 

and experience higher rates of disease than people 

in other affluent countries. 1 These stunning 

comparisons are global. But the healthcare challenge 

is local. So is the opportunity. 

Consider your own market. Using the U.S. average, 

calculate what is spent locally. For example, 

in Philadelphia with a population of 4 million, 

healthcare represents a $36 billion market. 

What does this mean for your organization? 

intent and upfront investment in infrastructure, 

technology, culture and resources – but it also 

presents the best opportunity to achieve longterm 

financial stability. 

Building ROI in a Successful 

Accountable Care Model 

Accountable care is about getting healthcare 

Spending Calculations 

The number of potential patients is the starting 

point. Factor in the number of healthcare systems, 

provider groups and hospitals. Then calculate 

the ratio of primary care physicians to 

specialists, because PCPs are central to successful 

accountable care. The right combination of 

all participants sharing data transparently and 

seamlessly will create a “network effect” and amplify 

your results. Everyone benefits greatly when 

they are all connected in a network of healthcare 

providers and purchasers where incentives are 

aligned for overall success. 

This is the local opportunity. Seizing it requires 

a strategy that moves your organization 

from volume to value; from short-term cost 

management to long-term results. 

In this emerging model, costs matter. But, 

long-term clinical results will matter more, because 

they are the key to lower costs. Improved 

patient outcomes will drive the needed ROI for 

your healthcare system. 



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23

cFo perspective 

We believe that a strong model helps project 

trends such as revenues-to-physicians, total net 

revenue impact over time, shared annual savings 

per patient, as well as the potential impact of fullor 

partial-risk contracts. 

On the Web 

Facilities are working to 

reduce costs with the 

addition of hospitalists. 

Listen to this webcast on 

how the emerging role of 

hospitalists is becoming 

more specialized. Go 

to www.advanceweb. 

com/executiveinsight 

and search Hospitalists: 

Helping Hospitals Reduce 

Costs. 

Accountable Care is Not 

a Cost Control Experiment 

We can’t improve healthcare by driving down 

unit costs, shifting risk to providers with no data 

to manage it, and restricting patient access to 

care. Unit price controls and utilization management 

characterized managed care in the early 

1990s, and they didn’t work. We limited services, 

but ended up with more units of care. If we don’t 

understand the clinical outcomes, we defer and 

exacerbate long-term costs. 

The ROI Equation 

We believe that with the right model, your population 

can grow and your organization can 

prosper. The transformation begins with these 

assumptions: 

n A culture of value is based on balancing cost, 

quality and satisfaction 

n IT infrastructure and data solutions that extend 

beyond your own environment can result in 

better patient management 

n Better management helps achieve higher quality 

goals 

n Higher quality creates better patient outcomes 

n Better outcomes result in lower utilization 

n Lower utilization translates into cost efficiencies 

Depending on the terms of the contract, savings 

can be applied to rates, compensation or reinvestment 

in the organization. 

Investing for Increased 

Profitability 

To succeed in value-based care, transformation 

of the business model is essential. Such transformation 

is driven by three key elements: 

n Tools that enable an end-to-end, integrated 

view of care delivery and population health; 

that allow participants to collaborate with data 

exchange, produce quality reporting and capture 

the data to fulfill objectives 

n Information about patients in a population that 

is converted to actionable intelligence in order 

to improve decision making at the point of care 

n Incentives that reward physicians for delivering 

specific value-based outcomes such as clinical 

quality, cost-effectiveness or population health. 

These outcomes must be significant and 

meaningful to the health system, providers and 

patients. Contract metrics must be measurable 

with incentives paid to reward physicians for the 

workflows and behaviors that support business 

model and care delivery model transformation – 

all focused on quality outcomes. 

Emerging Models 

The innovators are moving toward payment 

models that reward coordinated care and quality 

outcomes. Those who have been practicing 

value-based care for nearly a decade under the 

Lumeris Collaborative Payer® Model are seeing 

success as measured by the Triple Aim Plus One: 

reducing per capita healthcare cost by up to 30 

percent from traditional fee-for-service models, 

improving care quality and population health 

and enhancing patient and physician satisfaction. 

Best practices from that model include: 

n Investing in an operational assessment — 

Shape your plan to transform your enterprise by 

assessing provider culture, strengths, weaknesses, 

opportunities and threats. Listen first. 

Transform second. 

n Engaging physician champions — Position your 

organization as an ally of the providers. Add 

physician satisfaction to your accountable care 

Triple Aim. 


n Designing appropriate incentives and initiatives — Establish reimbursement 

models for both providers and patients that reinforce 

positive behaviors and eliminate costly behaviors with no significant 

clinical benefit. 

n Use technology wisely — Provide the technology, tools and 

training that ensure physicians can deliver the right care, in the 

right setting at the right cost with clear accountability for clinical, 

financial and quality outcomes. Make sure the technology delivers 

data at the point of care and eliminates burdens in addressing 

clinical quality metrics and gaps in care. 

n Keeping patients satisfied — Transform your culture to prioritize the 

human element of care. Pursue operational excellence to automate 

administrative tasks where possible, giving providers more time to 

focus on providing high-quality, coordinated and patient-centered 

care. Happy patients are accountable patients. 

Next Steps for Your Organization 

We believe that a strong model helps project trends such as revenues-to-physicians, 

total net revenue impact over time, shared 

annual savings per patient, as well as the potential impact of fullor 

partial-risk contracts. In working with health systems, payers 

and providers on their journey to value-based care, we see potential 

to address critical quality and cost metrics – including 

utilization and readmission – and realize meaningful savings. 

The right strategy begins with a financial risk model that defines 

the population of patients, the payer (or whether you will be your 

own payer), providers and hospitals. A trusted partner can help 

you identify the right elements of the model. 

The CFO’s Role in Value-based Care 

In the emerging universe of accountable care, CFOs have the opportunity 

to help create a new business model. Accountable care 

represents an inflection point for your organization. To be sure, 

this shift cannot be outsourced. This transformation requires your 

hands-on guidance. Here are a few final tips to ensure your success. 

n Bring a strategic, leadership perspective to the conversation. Be willing 

to move beyond your traditional role – and your comfort zone. 

n Build partnerships across the C-suite. Trusting relationships will 

facilitate the decision-making that lies ahead. 

n Identify the innovators. Primary care physicians are central to the effort. 

n Layer the right systems and technology. Success depends on data 

systems that enable integrated, efficient care. 

n Collaborate. Identify the data you need to make the case for business 

and care delivery transformation within your organization 

and share it. 

Reference 

U.S. Health in International Perspective: Shorter Lives, Poorer Health. 2013 Study 

sponsored by National Institutes of Health and U.S. Department of Health and 

Human Services. Available at: http://www8.nationalacademies.org/onpinews/ 

newsitem.aspx?RecordID=13497 (last accessed July 10, 2013). 

cIo perspective 

An Enhanced IT Portfolio 

for a New Model of Care 

How Virtua is turning data into ‘intelligence.’ By Alfred Campanella 

The executive leadership team at Virtua is 

committed to creating an expanded healthcare 

delivery model in southern New Jersey 

to serve our patients, with emphasis on improving 

the overall quality of care, access to healthcare 

services, and controlling overall costs. 

Our new mission statement, adopted in mid- 

2012, says that Virtua will “help you be well, get 

well and stay well.” And, our new vision statement 

says that Virtua “will be the premiere 

choice in health and wellness.” 

Everything we do is filtered through that mission 

and vision, and each year we develop dozens 

of clinical, process and financial goals and objectives 

that keep the entire organization focused 

on the right things. It is with this backdrop 


25

cIo perspective 

Alfred Campanella is 

executive vice president, 

Strategic Business Growth 

& Analytics (former CIO), 

Virtua Health, Inc. 

With ACOs comes the challenge 

associated with the next evolution of 

computerization in healthcare, specifically 

the move from automating transactions 

to improving care delivery via 

enhanced clinical intelligence. 

by the HIMSS organization as a “Stage 6” organization, 

its second-highest maturity category, 

presently awarded to only 8.2% of all hospitals nationally. 

that Virtua has continued to invest in its information 

technology (IT) portfolio, building upon 

10 years of prior investments. 

Like other leading healthcare systems, in recent 

years we have implemented an electronic health 

record (EHR) and numerous other systems to facilitate 

clinical workflow, clinical decision support, 

and documentation, and Virtua was recognized 

Using HIEs: Getting IT Right 

As an “early adopter,” one of our key IT investments 

was a Health Information Exchange (HIE) 

system from Waltham, Mass.-based Alere Accountable 

Care Solutions, available to healthcare 

providers in our three-county market. Our physician-led 

selection committee liked the system’s 

look, feel and functionality, and the system’s 

features meshed with the federal government’s 

emerging standards for system interoperability 

and demonstrated the vendor’s forward-looking 

insights into the healthcare environment, particularly 

its understanding of the importance of 

focusing on the patient and the ease of use for 

end users. 

Because data sharing is a relatively new concept, 

we developed standardized policies and 

procedures before we flipped the switch on the 

technology. As such, we developed numerous 

policies to govern the HIE. To help the industry 

as a whole move toward this new model, we 

have made these policies publically available 

at: http://www.nj.gov/health/njhit/document_ 

files/HIE_Policies_Forms/Virtua_HIE_Policies_ 

TOC_and_Background_and_Overview_donated.PDF. 

After building this very detailed foundation, 

we needed to overcome the practical challenges 

associated with getting data into the system. 

For example, before populating the HIE with a 

pipeline of data, including discharge summaries, 

lab results and imaging reports, we implemented 

a technology that tags all “sensitive data,” as defined 

by federal and state regulations, ensuring 



virtua health: by the numbers 

4 

hospitals 

2 

skilled nursing facilities 

2 

home care agencies 

3 

fitness centers 

7 

ambulatory surgical centers 

250 

employed physicians 

12 

paramedic units 

8,000 

babies delivered annually 

8,500 

employees 

On the Web 

For additional content 

on staff engagement and 

technology buy-in, go to 

the “Executive Perspectives 

for the Continuum 

of Care” column at www. 

advanceweb.com/executiveinsight 

that we were protecting confidential patient information 

related to health issues such as AIDS, 

psychological conditions and other sensitive 

health issues. 

We then concentrated on growing the number 

of participants tied into the information exchange. 

After getting the initial participants into 

the system, we started to recruit other physician 

practices and labs into the HIE. The goal is to 

have all of these providers not only tap into the 

HIE’s portal-based repository, but also to share 

their patient data via interoperable exchange 

with their EHRs. 

Becoming an ACO 

Our adoption of HIE positioned Virtua well 

for becoming an Accountable Care Organization 

(ACO) under the Medical Shared Savings 

Program, for which health data must be shared 

among ACO participants. With ACOs comes 

the challenge associated with the next evolution 

of computerization in healthcare, specifically 

the move from automating transactions to 

improving care delivery via enhanced clinical 

intelligence. 

We plan to meet these new challenges by leveraging 

Alere Analytics to turn the data into 

“intelligence.” For example, we will be deploying 

a sophisticated rules engine that constantly 

“listens” to our aggregated clinical data to 

identify when patients have gaps in necessary 

and preventive care and predicts when prompt 

medical attention is needed to avoid a hospital 

readmission or other costly types of care. The 

technology platform also includes customizable, 

evidence-based care plans that will assist 

Virtua’s nurse coordinators and physicians with 

decision-making, care documentation and communication 

with other providers. The integrated 

platform of HIE, near real-time analytics and 

computerized care plans will provide necessary 

IT support for care coordination across the various 

domains of care. 

As part of our new program, we will also deploy 

500 home-based biometric monitoring devices 

that will electronically transmit patients’ 

blood pressures, weight and other biometrics 

into the HIE, making it possible to gather and 

react to various health measures in near real-time. 

With such functionality in place, caregivers 

will be able to better manage patients. If a heart 

patient begins to gain weight over a short time 

period, for example, a caregiver will contact the 

patient and immediately begin to provide coaching 

or other needed services. 

IT Portfolio 

With HIE and various analytical and care-coordination 

technologies, Virtua is implementing 

the technological capabilities needed in the 

years to come, as the entire healthcare industry 

undergoes a re-engineering to meet the ever-emerging 

requirements of national healthcare 

reform and the needs of our patients in our 

local markets. Such IT investments bode well 

for supporting our strong commitment to our 

patients, “Virtua helps you be well, get well and 

stay well” and “will be the premiere choice in 

health and wellness.” 


27

adiology improvements 

The Executive Handbook to Radiology 

Department Improvements 

The application of intelligent informatics and workflow management solutions could wed 

efficiency, quality and value. By Claudine Martin 

Claudine Martin is director, 

Solutions Management, 

Imaging, M*Modal. 

The complexity of imaging 

environments and the performance 

expectations of 

radiologists have multiplied 

exponentially. 

Rising expectations and requirements in an 

increasingly complex healthcare environment 

coupled with decreasing resources 

require significant improvements in productivity 

and efficiency within medical imaging. The rapid 

adoption of electronic health records (EHRs) and 

the increased volume and speed of new medical 

information make workflow management even 

more important for healthcare providers to deliver 

timely, high-quality patient care. To provide 

maximum value to patients it’s important for 

healthcare providers to work together with informaticians 

to provide meaningful innovation 

that will lead to lower costs, quicker turnaround 

times and improved outcomes. 

To achieve these aims, the next generation of 

imaging informatics must possess several specific 

capabilities within a workflow solution, including 

rich interoperability between disparate 

systems, optimized and targeted context-specific 

workflow, business intelligence and analytics 

(BIA), and synergy with the EHR. With these 

new capabilities, the next generation of workflow 

solutions will finally have the ability to leverage 

and maximize the content contained in all RIS, 

PACS, speech recognition and EHR systems. 

Efficiency Without 

Compromising on Quality 

The job of the radiologist is to make a diagnosis 

as fast as possible. To do that, they need the 

appropriate clinical content at the time of 



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29

adiology improvements 

Today, radiologists are paid for what they 

do. In the future, radiologists will be paid for 

results based on quality outcomes. Federal 

regulations are pushing for imaging groups 

to perform the least amount of imaging possible, 

which would lead to more profitable 

reads for a radiologist. 

On the Web 

To learn more on cloud 

computing, m-Health and 

more as it pertains to 

your imaging department, 

go the “Imaging 

Solutions” section at 


executiveinsight 

interpretation. The accuracy and comprehensiveness 

of an interpretation should be based 

on all relevant clinical data. The highest quality 

interpretation is delivered when a radiologist 

takes the time to analyze the clinical content. 

However, there are huge barriers to doing 

this -- making phone calls, tracking down the 

patient record and searching through the EHR 

— all of which become too much of a hassle and 

force the radiologist to become the “integrating 

agent.” While radiologists know this is the right 

thing to do, they simply don’t always have the 

time to do it. Radiologist shouldn’t be forced to 

sacrifice to achieve efficiency. 

In an ideal world, the radiologist’s workflow 

would consist of pulling up a case from a worklist, 

seeing the images displayed and simply 

right-clicking anywhere on the images to see all 

the other data related to that case. Behind-thescenes, 

the “smart” workflow solution would 

search out all relevant clinical information for 

that exam and pull it into this view. The information 

presented would be based on the current 

case where the intelligence is so critical. 

Key pieces of the patient history include laboratory 

values, pathology reports and smoking 

history/disease history/family history. Finally, 

the system could, where appropriate, insert a 

best practice guideline recommendation into 

the report based on the radiologist’s findings. 

For example, it could recommend a follow-up 

exam in three months. The system would track 

the recommendation, ensure the attending physician 

is notified and that a follow-up exam is 

actually ordered. 

Shift to Fee-for-Performance 

Today, radiologists are paid for what they do. In 

the future, radiologists will be paid for results 

based on quality outcomes. Additionally, federal 

regulations are pushing for imaging groups to 

perform the least amount of imaging possible, 

which would lead to more profitable reads for a 

radiologist. Business analytics will be needed to 

support this shift. Information such as the appropriateness 

of an order, the reason for a given 

order, who is ordering the most of a particular 

exam, and outcomes of those particular orders 

will need to be available to remain competitive 

and profitable during this change in the imaging 

market. 

Healthcare practices and outcomes won’t improve 

without access to data to analyze. In this 

regard, there is a need for both dashboards and 

scorecards. Dashboards, intended to be tactical 

in scope, contain operationally focused performance 

monitoring tools and use graphical representation 

of the data. Scorecards, in contrast, 

are strategic in nature and focus on managing 

performance and utilize metrics such as key 

performance indicators (KPI) related to specific 

business or clinical goals. Scorecards enhance the 

strategic understanding of the department. 

Despite the traditional segregation between 

dashboards and scorecards, newer systems are 

blurring the distinction. For example, a system 

might provide the dashboard perspective of radiation 

dose to a specific patient during a single 

exam while the scorecard perspective shows the 

longitudinal exposure to patients. 

Workflow management must include a clinical 

search and discovery system with Natural 

Language Understanding (NLU) to aggregate 

information, understand it semantically, and 

constantly check for new information. Based on 

business rules, the system would send off the appropriate 

alerts and start the escalation logic as it 

encounters unstructured data. This is where the 

scorecard type of Business Intelligence becomes 

valuable. It gives long-term recommendations; 

not just presenting the user information in real 

time to make better diagnosis, but triggering the 

business logic to complete the task. 

The complexity of imaging environments 

and the performance expectations of radiologists 

have multiplied exponentially. Radiologists 

need to go above and beyond mere image interpretation 

and focus on patient management. 

The application of intelligent informatics and 

workflow management solutions could wed efficiency, 

quality and value, and help radiologists 

to help stay relevant, engaged and aligned with 

the enterprise. 


VAP 

Cost Implications of VAP 

An equation developed by Johns Hopkins helps administrators quantify potential savings by 

reducing hospital-acquired infections. By Gail O. Guterl 

advance 

peer 

reviewed 

PR 

Gail O. Guterl is an editor and 

freelance medical writer. 

It would be utopia if quality patient care was 

the only engine driving healthcare today. 

The reality is a facility must generate profit 

to keep its doors open. But what if you could 

do both? 

Some expenditures can’t be avoided, but reducing 

hospital-acquired infections could be a 

big cost saver — especially now that the Centers 

for Medicare and Medicaid will not reimburse 

for many of these preventable complications. 

One of the most common hospital-acquired 

infections is ventilator-associated pneumonia 

(VAP), affecting about 250,000 people annually. 

It is also one of the most expensive, costing anywhere 

from $12,000 to $40,000 to treat one hospital 

case and with a 60 percent mortality rate. 1,2 

Each year in the U.S. a conservative estimate of 

collective VAP infections costs a whopping $3 

billion. 

Any way you approach it, reducing VAP could 

markedly impact the bottom line and, most importantly, 

improve patient care. 

PROBLEMS & SOLUTIONS 

Understanding the problem is the first step to 

elimination. VAP is defined as pneumonia that 

occurs more than 48 hours after a patient has 

been intubated and has been receiving mechanical 

ventilation. For every day on a ventilator, the 

risk of VAP increases from 1 to 3 percent, said 

Sean M. Berenholtz, MD, MHS, FCCM, physician 

director of Inpatient Quality and Safety, 

Armstrong Institute for Patient Safety and Quality, 

Johns Hopkins Medicine, Baltimore. 

Before expensive treatment for VAP can even 

begin, diagnosis itself can be costly, including 

aggressive patient surveillance, bedside examination, 

X-rays and laboratory analysis of respiratory 

secretions. 

Believing prevention is achievable, researchers 

at the Armstrong Institute decided to tackle 

the issue head-on. The result: a five-point initiative 

that has virtually eliminated VAP in numerous 

hospitals, including 65 Michigan facilities 

that were part of the Keystone ICU project 


31

VAP 

which tested the program. Zero incidence means 

zero dollars spent on treatment. 

The five-point program incorporates basic patient 

care tasks based on the premise most VAP 

occurs as a result of contamination of the lungs 

from oral bacteria. And it offers tools and strategies 

created by the Armstrong Institute group 

to achieve reduction, such as CUSP (Comprehensive 

Unit-based Safety Program) and TRiP 

(Translating Research into Practice). The five 

points include: 

n Head of bed elevation — use of a semi-recumbent 

position (≥ 30°) keeps the bacteria from 

migrating into the lungs 

n Spontaneous awakening and breathing trials 

— daily assessment of sedation and readiness 

to wean 

n Oral care — at least 6 times per day to decrease 

bacterial load 

n Oral care with chlorhexidine — should be included 

in the oral care regimen twice per day 

n Subglottic suctioning endotracheal tubes (ETTs) 

— use subglottic suctioning ETTs in patients 

expected to be mechanically ventilated for >72 

hours. “This allows care providers to suction any 

pooling saliva that collects in the trachea before 

it reaches the lungs,” Berenholtz explained. 

“Actually, the ventilator bundle from which VAP 

reduction occurred wasn’t developed to reduce 

VAP as much as it was to reduce complications in 

patients with mechanical ventilation,” Berenholtz 

said. “But we saw that by initiating interventions in 

the bundle, it reduced VAP incidence.” 

WEIGHING COSTS 

The cost of eliminating VAP depends on the region. 

But what is the cost of equipment and staff 

training for these five interventions? 

From Berenholtz’s experience the training required 

is minimal and is typically done by existing 

nurse educators or infection control personnel. 

And since oral care has become a standard 

of care per most guidelines for VAP reduction, 

many facilities are already doing it. 

“Subglottic tubes cost around $7 versus $1 

for a standard breathing tube,” Berenholtz explained. 

“A few cost-effectiveness analyses suggest 

the extra cost of the subglottic tube is more 

than paid for by reductions in VAP, antibiotics 

and ICU length of stay.” 

Bed turnover is critical to the bottom line. 

VAP is defined as 

pneumonia that 

occurs more than 

48 hours after a 

patient has been 

intubated and has 

been receiving 

mechanical ventilation. 

For every 

day on a ventilator, 

the risk of VAP 

increases from 1 

to 3 percent. 

On the Web 

A study by the Agency 

for Healthcare Research 

and Quality (AHRQ) 

offers evidence that 

nurse-to-patient staff 

ratios has been linked 

with patient outcomes. 

Read more at http:// 

healthcare-executive-insight.advanceweb.com/ 

News/Daily-News-Watch/ 

Evidence-Based-Staffing-Helps-Eliminate-Nurse-Burnout-and-Hospital-Acquired-Infections.aspx 

“Most hospitals are able to increase revenue 

by turning over beds, the same as a restaurant 

would tables,” Berenholtz said of the benefits of 

the program. “With more open beds, the hospital 

can admit additional patients and increase 

their revenue.” 

PROVE IT 

Critical to the entire VAP reduction process is administrative 

buy-in. What better way to achieve 

that than to show the bottom line benefits from 

adopting these research-based practices? 

“Part of the challenge of these initiatives is that 

administrators need to be engaged,” Berenholtz 

told Executive Insight. “Often there is no traditional 

way to do this. But we felt a tool that could 

track ventilator rates and convert those rates into 

deaths, dollars and days would help staff and administration 

translate the information into the 

number of preventable deaths, number of ICU 

days and the cost of their performance.” 

With an unrestricted educational grant from 

Sage Products, Inc., Johns Hopkins Armstrong 

Institute developed a free, easy-to-use equation 

called the VAP Opportunity Estimator (http:// 

www.hopkinsmedicine.org/quality_safety_research_group/our_projects/ventilator_associated_pheumonias/estimator.html). 

The Estimator 

helps calculate the potential number of avoidable 

deaths, excess ICU days and excess costs 

based on a facility’s total number of VAPs. The 

tool uses published estimates of VAP case fatality, 

cost per VAP and additional LOS per VAP to 

get real-time figures on what VAP costs a facility. 

Those figures can be applied to estimate what 

potential savings can be gained by implementing 

a VAP reduction program. 

“Presenting the data as potentially avoidable 

deaths, dollars and days rather than traditional 

VAP rates makes it more meaningful for patients 

and staff,” Berenholtz said. “It especially helps 

staff understand how their performance and level 

of care impacts patients.” 

References 

1. Berenholtz SM, Pham JC, Thompson DA, et al. An intervention 

to reduce ventilator- associated pneumonia in the 

ICU. Infect Control Hosp Epidemiol. 2011;32(4): 305-314. 

2. Tablan OC, Anderson LJ, Besser R, et al. CDC Healthcare 

Infection Control Practices Advisory Committee. Guidelines 

for preventing health care-associated pneumonia, 

2003: Recommendations of CDC and the Healthcare Infection 

Control Practices Advisory Committee. MMWR 

Recomm Rep. 2004 Mar 26;53(RR-3):1-36. 


mobile medicine 

jeff leeser 

Success With 

Mobile Medicine 

Kearney Clinic improves clinician efficiency and patient 

care with voice-enabled, mobile dictation. By Steve Jensen 

Steve Jensen is CIO and network 

services administrator at Kearney 

Clinic. 

We’ve all seen the stories about the explosion 

of mobile health technology 

amongst the medical community. 

Alongside this mobile technology expansion 

and the related patient care improvement opportunities 

surrounding it, we’ve encountered 

a series of roadblocks – from frustrations surrounding 

changes in workflow to more threatening 

issues like device security. Still, one thing 

is for sure, the mobile healthcare workforce is 

swiftly becoming a reality and the trend toward 

more expansive mobile technology adoption 

amongst clinicians holds the potential to address 

not only productivity issues, but to also 

improve patient care. 

To enable an on-the-go approach to real-time 

patient care and related documentation, Kearney 

Clinic adopted a voice-enabled, mobile approach 

to dictation. This approach, which has 

morphed over the years as a result of mobile 

device advancements, has led to significant and 

ongoing improvements to clinician productivity 

and patient care. 

3 Things to Consider 

As CIO and Network Services Administrator 

at Kearney Clinic, I’ve had the opportunity to 

learn first-hand what doctors do and do not 

want when it comes to technology. I’ve also 

had the chance to understand what it takes to 

streamline the adoption of new technology. I’ve 

learned three things to keep in mind as healthcare 

provider organizations look to mobilize 

their workforce: 

Communicate, Communicate, Communicate 

– It may seem like a no brainer but one of the 

hard lessons I learned early on was the importance 

of communicating change far in advance 

of that change actually taking place. It’s important 

to keep the lines of communication open 

even after initial mobile adoption hurdles 


33

mobile medicine 

As a result of the adoption of this technology and 

related back-end transcription platform, we’ve been 

able to decrease our transcriptionist staff — which 

has led to reduced overhead — and physician productivity 

has increased by as much as 400%. 

On the Web 

Stay abreast of mHealth 

technology via our monthly 

column at http://healthcare-executive-insight. 

advanceweb.com/columns/mHealth/How-Mobilization-Can-Truly-Transform-Healthcare.aspx 

have been addressed. Put simply, communicate 

early and communicate often. 

Foster Physician Champions – Early adopters 

are your best bet when it comes to ensuring a 

smooth transition to a new mobile technology. 

Let these folks be the voice of reason because a 

peer-to-peer approach to training and information 

sharing has more value than a top down, IT 

approach. 

Collaborate with Vendors on Emerging Solutions 

– One of the main reasons Kearney Clinic 

has had such notable success with mobile dictation 

solutions is that we bought in on the vision 

of this solution before all the bells and whistles 

had come to market. As a result, we were able 

to influence how this technology has evolved 

over the years. Considering that many mobile 

solutions are still “green,” it’s worth considering 

what vendors have a proven track record of success 

when it comes to bringing new solutions to 

market and driving regular advancements in 

the technology. These are the mobile IT partnerships 

you want to embrace. 

Kearney Clinics’ Success 

I also want to share a bit more on our particular 

mobile story of success in the hope that your 

organization can learn from our efforts. Kearney 

Clinic is a multi-specialty clinic serving Nebraska 

and parts of Kansas and South Dakota. 

Our 30-plus physicians see about 500 patients 

a day, and more than half are walk-ins. Back in 

the good old days, physicians dictated their notes 

into handheld tape recorders and those tape recorders 

were passed on to our 25 transcriptionists, 

who then shared the transcribed notes after 

the patient had left the clinic. As healthcare 

evolved, the need and importance of near immediate 

access to the patient’s transcribed note 

became more evident -- and actually feasible for 

that matter. 

Today, all of our physicians are using the iPhone 

4 or iPhone 5 and the latest in voice-enabled, mobile 

dictation technology (Nuance). As a result of 

the adoption of this technology and related backend 

transcription platform, we’ve been able to decrease 

our transcriptionist staff -- which has led to 

reduced overhead — and physician productivity 

has increased by as much as 400%. Other benefits 

of this on-the-go approach to dictation include 

the ability for clinicians to dictate anytime, anywhere 

and to actually go home sooner at the end 

of the day. Moreover, our physicians have noted 

their belief that dictation offers a more personal 

connection to the patient because it allows them 

to enter notes right in front of the patient so 

there’s no miscommunication; additionally, the 

note is a direct reflection of the patient’s situation 

and care plan. 

As noted above, one of the key reasons we’ve 

been so successful with mobile dictation and now 

with integrating mobile dictation with our electronic 

medical record (Greenway) is that we took 

a chance with the technology early on and also 

evolved our approach in line with advancements 

in emerging devices. We also failed early and 

failed often with a small group of beta testers so 

that we were able to hone our approach swiftly to 

ensure our physicians had the best technology at 

hand to dictate the patient note in a manner that 

suited their workflow. Additionally, we armed 

our transcription team with added technology 

and functionality so as to take a two-pronged 

approach to streamlining the dictation-to-transcription 

process. As a result, in addition to the 

previously mentioned physician productivity 

benefits, we’ve also seen an average 40 percent 

increase transcription productivity, and a reduction 

in transcription staff required to maintain 

the same level of 24-hour maximum turnaround. 

On-the-Go Tools 

As clinicians and the organizations they work 

for adopt a more mobile workflow, solutions 

that help them save time and improve patient 

care while on-the-go will be in high demand. 

Technology, like mobile-voice-enabled dictation, 

will undoubtedly be one of the key tools in the 

next-generation “doctor’s bag.” As you approach 

this transition to mobility, don’t lose sight of the 

importance of keeping a laser focus on the human 

in healthcare and arming clinicians with 

mobile technologies that allow them to work 

smarter, not harder. 


inventory management 

Operational 

Cost Creep 

Consistent inventory management is critical to avoid 

unnecessary expenses. By Michael Jones 

Michael Jones is on staff at 

ADVANCE. 

There are any number of additional expenses 

in a healthcare facility that seem small 

in relation to the overall budget, but can 

become substantial in the long run. These factors 

have to be kept in check—by the varying 

departments and by employees on the individual 

scale—to cut down on unnecessary costs. In a 

recent interview, Joe Skochdopole, CCE, senior 

director of operations support at TriMedx, provided 

some insight into potentially costly habits 

a facility can develop over time and what can be 

done to avoid cost creep. 

“I believe the appropriate approach is, ‘how do 

we maximize what we have before we talk about 

cutting quality?’” said Skochdopole. “There are 

so many efficiency and waste issues in healthcare 

that I don’t think we have to reduce quality in any 

way, shape or form.” 

Skochdopole presented three factors in particular 

that can cause cost creep in a facility, 

which include: 

n The extra fees and expenses that occur after 

the initial payment is made on medical devices, 

consumable pieces 

n Extra capital spending in departments, such 

as software and hardware updates, service 

charges and enhancements 

n The importance of standardization 

A common problem in hospitals, clinics and 

other healthcare institutions is an abundance 

of medical devices and machines, all from 

different manufacturers that require specific 

parts. Due to this lack of standardization and 

the varying accessibility of medical equipment, 

facilities end up overspending on maintenance 

costs alone. 

“Manufacturers are trying to figure out how 

to increase their revenue streams,” continued 

Skochdopole pointedly. “How do they stay competitive 

from an acquisition standpoint, but continue 

to keep revenue coming into them for the 

life of that device?” 

Early Action 

To be successful at cutting down on cost creep 

expenses, it has to be started early in lifecycle 

management and implemented facility-wide via 

policies and regulations as well as on the individual 

level. Skochdopole noted on the need for 

early action, citing preventive measures like the 

development of cross-functional committees to 

monitor the purchasing of medical devices 

A common problem 

in hospitals, clinics 

and other healthcare 

institutions is an abundance 

of medical devices 

and machines, 

all from different manufacturers 

that require 

specific parts. 

% cost/revenue 

cost “creep” 

cost-cutting exercise 

target 

time 


35

inventory management 

The more a consistent 

inventory 

process is 

maintained, the 

more efficient 

and cost-effective 

the departments 

within a facility 

become. 

On the Web 

For more inventory management 

solutions, enter 

“Inventory Management” 

in the keyword search 

box at www.advanceweb. 

com/executiveinsight 

as vital to avoiding additional expenses down the 

line. These committees should enlist representatives 

from the facility, including: 

n Clinical users, who work with the equipment 

daily and understand the needs of the facility 

n Clinical engineers, who are responsible for the 

maintenance of that equipment 

n Supply chain workers, who have to stop the 

consumables for that product 

n Financial supervisors, who have to budget for 

that equipment 

n IT professionals, who are in charge of incorporating 

that equipment into the facility networks 

“People get too enthralled by bells and whistles 

and want the latest, greatest and the newest,” 

explained Skochdopole. “When, in reality, for 

what they’re doing and how they’re reimbursed, 

they are not necessary.” 

Organizational Issues 

On the other side of the coin, a large problem 

that leads to cost creep is organizational policies 

within the facility. Skochdopole discussed 

what actions individual healthcare professionals 

can take to prevent potential sources of cost 

creep. Different machines and devices become 

underutilized due to mistakes in recordkeeping 

and inventory tracking. He pointed out that the 

average device in a healthcare setting, even the 

ones that seem scarce, are overstocked (i.e., average 

utilization is under 50%). Rather than over 

spending on extra resources, facilities can counter 

the additional funding that would otherwise 

go to waste by ensuring efficiency within their 

own inventory departments. 

“A big part of it is the clinical staff understanding 

where things are, when they’re available, central 

supply cleaning them, clinical engineering 

maintaining them,” said Skochdopole. “So, really 

it’s ‘have it available and ready when it’s time to 

use it so that you don’t have to overbuy and become 

inefficient.’” 

Donate Unused Equipment 

On top of disorganized inventory systems, hospitals 

and clinics put older or unused machines 

into storage rather than exploring other options; 

smaller or more rural hospitals lacking in upto-date 

equipment may welcome the addition 

of older technology. While this is great news 

for the hospital receiving the technology, this 

would also be ideal for the hospitals supplying 

used equipment that could then cut down on 

cost creep – as storing old equipment ends up 

running up bills in regards to warehouse fees and 

storage costs. 

As the healthcare industry continues to grow, 

it’s important for healthcare facilities and their 

respective staff to focus on factors that lead to 

excess spending over time within the organization 

and methods to limit cost creep. While new 

technologies are influencing trends in hospitals 

and clinics, inventory practices are becoming vital 

to maintaining financial standardization over 

time not only to adapt with the changing industry, 

but also to know when it’s time to phase out 

older equipment for newer technologies. The 

more a consistent inventory process is maintained, 

the more efficient and cost-effective the 

departments within a facility become – and, as 

the older equipment is donated to other, less 

prominent hospitals lacking funds for new technology, 

their programs can become more efficient 

as well. 


Laboratory Information Systems 

The Successful LIS Demo 

Time investment and due diligence upfront will pay off. By Lisa-Jean Clifford 

Lisa-Jean Clifford is CEO of 

Psyche Systems Inc. 

If you’re looking to invest in a laboratory information 

system (LIS), what you need to know is 

crucial to the success of the project—and your 

lab—for the next 10 years. 

The average laboratory will invest in an LIS 

every 10 years. Whether they actually purchase 

and implement a new or different LIS or not, 

they make the investment in time and resources 

to do the full evaluation of current solutions 

and vendors available to determine if they should 

make a move or stay with their current solution. 

And this investment is not small. Even labs that 

determine that their LIS solution is still the best 

one for their needs make a large commitment in 

both time and energy to the process. 

What is the Process? 

You will first need to determine what your goals 

and objectives are. Questions to pose are: Who 

are the decision makers? Who has a stake in determining 

what the objectives are and how are 

you going to gather requirements? 

Gathering Requirements 

You will need to determine what your A, B and 

C priorities are. These will include everything 

from expectations of the vendor to the detailed 

functional requirements of the LIS. Many labs 

will compile a Request for Information (RFI) 

while others will simply know what they are 

looking for and have an internal checklist. Either 

way, buy-in and sign off from all internal stakeholders 

will ensure that the success of the project 

is measureable, and therefore attainable. 

Vendor Selection 

Most people in the industry know who the major 

players are and will also know whether they 

are looking for a single vendor solution, a best 

of breed solution, or a hybrid. Many labs start 

with a vendor pool of many, and often a mix of 

the different types of vendors as stated above. In 

that case, the next step, stated in a very simplified 

way, is to narrow down your vendor selection to 

a maximum of three. This makes the process far 

more digestible, and the lab staff 

and management will be able to 

make a detailed evaluation and 

an informed decision. 

dave perillo 

The Demo 

The main things you should be 

looking for in the demo phase is 

for the vendor to demonstrate 

that the features you are expecting 

to see are real. You want to 

see a live demonstration of the 

software in a flexible manner. 

This shows that the functionality 

is real and not ‘canned’ for 

your benefit or that the product 

will only work in one way and 

therefore not support changes 

in workflow or lab goals once 

you have gone live. During the 

discovery of this point, you will 

want the sales person to be proactive 

in addressing different 

possible ways to achieve 


37

Laboratory Information Systems 

your goal, supporting the ease of use and flexibility 

of the software to meet changes in your 

process. Ask: 

n Will the vendor do customizations to the software 

to meet a specific need? If so, how long is 

their usual process and how do they do updates 

to your systems? 

Is the customization supported in future revisions 

and how do they charge for them? This too, will 

demonstrate flexibility and the vendor’s ability 

to be nimble and support changes not only to 

your lab’s workflow, but the industry in order for 

you to maintain a competitive edge. 

Checklist of Items 

The following are items to consider and address 

for the LIS demo to ensure a sound purchase decision. 

n Be mindful of “what’s under the hood” 

technology-wise. Demos are, by nature, highly 

polished and choreographed. What might look 

like a great system on the outside may just be a 

nightmare in terms of what’s behind the curtain. 

Ask to see how something is done (e.g., How 

do I add a new physician to the library? How 

do I customize a report? How are CPT codes 

attached? How do I sign out a case? How do I 

add an image?) 

n Be wary when the vendor sells services to completely 

build the system for you. This can be a 

value-added service, but it may also be a symptom 

of a bigger problem (i.e., it is too difficult for 

the lab to do on its own). Ask them to show you 

how to build a new test code or rule, for example. 

If the vendor can’t or won’t allow you to see 

or do these things yourself, that is a red flag. If 

they don’t, ask them what you can actually do 

yourself and what you need to engage them for. 

Ask what their fees and turnaround times are 

for anything that you cannot do or access in the 

daily management of the system. 

n Beware of the offer that sounds too good to 

be true. Some vendors are very savvy with 

proposal generation. Make sure before you 

accept the lowest bid or the cheapest price 

that the proposal specifically indicates all of the 

items that you need and discussed. Do not let 

them gloss this over or verbally commit to them. 

They need to be in writing and on the proposal. 

Beware of the rock bottom quote that “includes 

everything.” Be sure you ask about hardware, 

incremental costs like interfaces, travel expenses, 

third-party costs, etc. 

n Rampant price-slashing, especially out of sales 

representative desperation to close the deal, is 

not a reputable practice. Price is important, but 

don’t sacrifice the best solution for your lab and 

your objectives over a seemingly great discount. 

How does it make sense that the vendor was 

happy to charge you 50% more, and will suddenly 

take 50% less just to get your business? Do 

you think you will be as valued as a customer? 

Remember that you will most likely be in a relationship 

with this vendor for the next 10 years. 

n Take your time getting to know the sales rep and 

company. Solid vendors have nothing to hide, 

and many will offer to introduce you to their 

managers, or make introductions to their C-level 

officers. You are investing in a whole company 

and their perspective on how they treat their 

customers, not just a piece of software. 

n Remember that no system is perfect, and no 

vendor is perfect. When checking references, 

no vendor is going to offer you an unhappy 

customer. It’s important to ask references about 

their challenges and the biggest success or value 

that they get through the relationship with the 

vendor and the functionality of the system. 

n Vendors that speak badly about other vendors 

they know they are competing with are taking 

the focus away from your goals and your solutions. 

A good sales rep representing a reputable 

vendor and product will always focus on why 

their product, and their company, has brought 

success to their clients. 

n Beware the ‘yes’ man. It’s natural to get a quick 

“yes” from your vendor when asking questions 

like “Can you do this? Does your system offer 

that?” Ask to see it and check with their references. 

n Ask for another vendor as a reference. Playing 

well with others in this age of automation 

and integration is essential. Reputable, solid 

products with experienced and knowledgeable 

employees have relationships with other 

vendors and they work well together; make 

sure that your projects and implementation will 

not be delayed because of poor performance, 

attitude or lack of respect among other vendors 

in the industry. 

Making an investment in the time and due diligence 

upfront will payoff for years to come - in a 

smooth, positive LIS deployment and continuing 

relationship with your vendor. 

Most people in 

the industry know 

who the major 

players are and 

will also know 

whether they are 

looking for a single 

vendor solution, 

a best of 

breed solution, or 

a hybrid. 

On the Web 

For related content, enter 

“Laboratory Information 

System” in the keyword 

search box at www. 



evenue cycle 

Building a 

Bulletproof 

Revenue 

Cycle 

Time to raise the bar and 

drive continuous improvement 

to stay ahead of challenges. 

By Patrick Campbell 

It’s a rough world for healthcare providers. As 

if reimbursements weren’t tightening enough 

on their own, recent industry changes have 

brought additional pressure in the form of value-based 

systems, increased regulatory complexity 

(e.g., ICD-10), and rising labor costs. 

There was a time in the past when a certain 

amount of loss was acceptable, when problems 

could be solved by adding headcount. 

Unfortunately, those luxuries are long gone. 

It’s critical today for organizations to not only 

overcome current challenges, but to have a process 

in place to identify new issues, set standards to resolve 

them, and raise the bar to drive continuous 

improvement and stay ahead of future problems. 

scott frymoyer 

Patrick Campbell is 

product manager, 

MedAptus Inc. 

Process Analysis 

Before tackling the things you already know 

about, begin by evaluating and analyzing your 

process(es) to identify anything you may not 

know. Three simple counts will produce key 

metrics you can use immediately: 

• How many unique or varied revenue 

processes exist today? 

The trick to getting an accurate count of this 

number is to interview front-line employees 

throughout the cycle. It’s common for 


39

evenue cycle 

Certain problems and challenges are common 

across healthcare providers regardless of process 

design, so it’s important to learn from others and 

avoid reinventing the wheel. 

revenue if not resubmitted, but also in terms 

of the labor required to research, correct, and 

re-submit claims within the time limit. Consider 

implementing scrubbing tools throughout the 

process--the sooner errors are caught, the easier 

they are to resolve. 

On the Web 

To view an archived 

webinar on Revenue 

Integrity, go to the webinars 

section at www. 


coding and billing staff to “just fix” problems or 

invent special exceptions instead of suggesting 

process improvements. 

• How many human touches does 

the standard process require? 

This is a count of the actions of personnel 

(whether a physician, a biller, or other staff 

member) throughout the cycle. Every touch is 

an opportunity for delay or error, so it’s important 

to know how many there are. While you’re at 

it, also identify the typical time duration of each 

step in the process. 

• What is the ideal time-to-bill? 

What is the average? 

If everyone completed their tasks as soon as 

possible, how long would it take for a claim to 

be submitted? This number isn’t zero because of 

externalities and each touch by its nature having 

some friction. By comparing these ideal durations 

with the real-world averages collected earlier, 

you can get a sense of the major slowdowns 

and lags in the system. 

Resolving Common Problems 

Certain problems and challenges are common 

across healthcare providers regardless of process 

design, so it’s important to learn from others 

and avoid reinventing the wheel. Specifically, 

examine: 

• Habitual mis-coding (E&M Levels, 

Expired Codes, etc.) 

This is an issue that coding and billing staff will 

often inadvertently obscure by diligently correcting 

errors habitually created by a physician. 

Consider providing (regularly) a combination 

of peer comparison data, code pick list updates, 

and feedback on common errors to physicians 

and other clinicians. 

• Non-compliance with 

Local Payer Requirements 

Denials are expensive not just in terms of lost 

Missed Charges 

This is the “elephant in the room” of process 

challenges, especially for the inpatient environment. 

Reconciling outpatient schedules with 

charges received is a mercifully straightforward 

process built into most practice management 

systems. Inpatient charges are much more difficult 

to manage, but electronic tools exist for 

this as well. Paper-based reconciliation is possible 

but (due to its labor intensity) best applied 

as a rolling audit and not a universal standard. 

Raising the Bar 

Creating an organizational culture of continuous 

improvement will not just prepare a provider 

group for overcoming future issues but also 

increase revenue and compliance in the present. 

This is best achieved through a series of steps. 

First, deliver a clear message to the organization 

about the key metrics of global performance, 

their current status, and group-wide 

goals for improvement including target completion 

dates. High-achieving healthcare personnel 

(like physicians) often respond positively to clear, 

concise communication about “where we are” 

and “where we need to be.” 

Next, create as much transparency to individuals 

as possible about their own performance. 

Individualized reports and performance dashboards 

(if you can provide them) will greatly aid 

this effort. In some cases it may also be appropriate 

to link compensation to individual performance 

metrics. 

Pair these global and individual metrics with 

educational resources. In general, you’ll want to 

offer a mix of group courses with targeted, individual 

training. For example, your metrics may 

reveal that a particular coder is struggling with 

complex surgical charges and needs targeted assistance 

with surgical coding. 

Finally, increment your goals (“raise the bar”), 

and repeat the process. For some groups or 

smaller goals, it will be appropriate to iterate 

quickly over just a few months. Others will find 

that an annual program of improvement is a better 

fit organizationally. 


telemedicine 

Mercy Health has found 

telemedicine to be an effective 

way to enhance patient 

access to care, resulting in 

improved patient outcomes 

and decreased costs. 

scott frymoyer/jeff leeser 

Reimagining 

Patient Care 

Telemedicine brings patients and providers together. 

By Wendy Deibert 

Wendy Deibert is vice president, 

Telehealth Services at Mercy 

Health. 

In response to evolving changes in healthcare, 

hospitals and health systems are beginning 

to think outside the box when it comes to 

the best ways to deliver quality care and keep 

costs in check. One approach gaining traction 

is telemedicine—using telecommunication and 

information technologies to provide healthcare 

from another location. Mercy Health has found 

telemedicine to be an effective way to enhance 

patient access to care, resulting in improved patient 

outcomes and decreased costs. 

Why Telemedicine? 

Mercy Health serves more than 3 million people 

across Arkansas, Kansas, Missouri and Oklahoma. 

Approximately 90 percent of the counties 

served by the organization are rural, presenting 

challenges in fostering patient access to care. 

We believed that telemedicine could overcome 

some of these difficulties, conveniently bringing 

patients and providers together. 

Our first foray into telemedicine began in 

2006 when we went live with a tele-ICU program. 

Prior to this, we had intensivists in only 

one of our hospitals: The intensive care units in 

the other hospitals were run by consulting physicians, 

some of whom were not specialized in 

critical care. Our goal was to provide the same 

level of care throughout all our hospitals, and 

that meant we had to find a way to leverage the 

expertise of our existing intensivists. Research 

shows that ICUs with intensivists at the bedside 

offer better quality care in terms of lower length 

of stay and decreased mortality. 

Within 18 months of starting the tele-ICU 

program, Mercy brought 350 tele-ICU beds online 

with each bed hardwired to a wall-mounted 

video monitor. Through this technology, we were 

able to have constant intensivist coverage in each 

ICU. In addition, experienced critical care 


41

telemedicine 

nurses can monitor the various ICUs remotely. 

Since implementing this program, Mercy’s mortality 

rate, hospital length of stay and ICU length 

of stay have dropped by 20-30%. 

In addition to a tele-ICU, Mercy also has a 

telestroke program in which we use mobile 

telemedicine carts in each of our emergency 

departments (ED). If a stroke patient comes to 

the ED, we can move the cart to the patient’s 

bedside and a specialist can begin assessing and 

treating the patient right away. This not only 

gets expert care to the patient faster—a critical 

element in limiting the potential damage 

caused by a stroke—it also reduces the disruption 

to the patient because he or she does not 

need to be moved. 

Helping More Than Just Patients 

In addition to enhancing patient care, telemedicine 

can bolster clinician recruitment and retention 

efforts. For example, it can be challenging 

to recruit a highly credentialed specialist to 

work in a small hospital, and even if you can get 

an individual to come, you may only be able to 

afford one such person. With no back-up, the 

specialist would need to be on-call year-round 

without any breaks. This punishing schedule 

impacts quality of life and leads to high physician 

turnover. 

Through telemedicine, Mercy is able to have 

back-up support for all specialists, enabling the 

organization to offer specialized care at any time 

and at any facility. We can also ensure our physicians 

maintain balance in their lives, increasing 

both satisfaction and retention. 

Telemedicine also fosters continuity of care. 

For example, within the last year in one of our 

Lead Like A Rock Star: 

Rock Solid Leadership, 

Communication, and Collaboration 

August 28-30, 2013 • Myrtle Beach, SC 

The South Carolina Medical Group Management Association 

(SCMGMA) will host its annual conference "Lead Like A Rock Star: 

Rock Solid Leadership, Communication and Collaboration", at the 

Hilton Myrtle Beach Resort and Convention Center, Myrtle Beach, 

South Carolina. The event will feature presentations of interest to 

medical practice managers, hospital VPs and directors, and physicians. 

Topics include futuristic medicine, the Affordable Care Act, 

Medicare E and M Coding, process improvement, patient 

satisfaction, as well as a healthcare panel discussion. 

Those interested in attending or exhibiting may visit our website 

at www.scmgma.com or contact 

Cindy Ott, Executive Director, at 803-387-7864 for more information. 

Being open to 

change is the key 

to getting the 

most out of this 

technology. If 

you can imagine 

it, it’s probably 

possible, which is 

what makes using 

telemedicine 

so exciting and 

rewarding. 

On the Web 

For related content, enter 

“Telemedicine” in the 

keyword search box at 


executiveinsight 

facilities, we had a pediatric neurologist resign 

and there was no backup in place to cover his patients. 

Without telemedicine, we would’ve been 

forced to shut down the service until we found 

a replacement. Instead, we refitted one of our 

stroke telemedicine carts to support pediatric 

neurology and had the service back up and running 

in a week. 

Overcoming Roadblocks 

One of the biggest challenges Mercy had when 

launching the telemedicine program was physician 

resistance. Some physicians initially struggled 

to accept this technology as an appropriate 

way to assess patients and ensure safe care. We 

found the key to overcoming hesitation was to 

identify physician champions and enlist their assistance 

in getting others on board. 

We also learned that a physician needs to experience 

telemedicine firsthand to fully appreciate 

it. The equipment has a high-definition, color 

camera that can zoom in to an area, allowing a 

physician to conduct a thorough assessment, 

examine wounds, read an IV bag and so on. By 

interacting with the equipment, physicians can 

better visualize how the technology enhances 

patient care. 

Getting Started 

There is no established blueprint for launching 

a telemedicine program. The approach we took 

was to first research current trends in the field, 

and since the technology is evolving rapidly, it’s 

important to keep attuned to what’s happening 

in the market. We also developed a strategic plan 

that outlined short-term and long-term goals. 

After that, we dove into the work, pilot testing 

different applications to see what was most beneficial 

for our organization. 

Even though Mercy Health has had a telemedicine 

program since 2006, we feel we’ve 

just scratched the surface of the technology’s 

potential. We are constantly finding ways to 

incorporate telemedicine into patient care. We 

have 72 projects under way that are integrating 

the technology into various areas, including 

school-based clinics, work site clinics, palliative 

care programs and remote home monitoring 

programs. 

Being open to change is the key to getting the 

most out of this technology. If you can imagine 

it, it’s probably possible, which is what makes using 

telemedicine so exciting and rewarding. 


1,440 n EW Yo RK m I n U t E s : 

Establishing a high-volume, 

24/7 lab to support a trauma 

center. And a pediatric ICU. 

Abbott Diagnostics worked around the clock to make it happen 

for one institution. See what, together, we can do for yours. 

Trauma centers and pediatric ICUs move fast at all hours. For one New York–area hospital, having a 

laboratory that can quickly and accurately turn a test around at any time of day—or night—is absolutely vital. 

Lives depend on it. That’s why it was important to not just install multiple systems, but to have a team 

of engineers, medical technologists and IT consultants on call to ensure the assays were up, running 

and responsive to our customer’s rigorous demands. At Abbott Diagnostics, we go beyond tests and 

instruments. We’ll partner with you to develop a solution that fits the needs of your laboratory. VIsIt 

AbbottdIAgnostICs.Com. 

Put science on your side. is a trademark of 

Abbott Laboratories in various jurisdictions. 

© 2011 Abbott Laboratories MS_11_13304/v3 

Put science on your side. 


43

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