- The transformation of the healthcare industry is not unlike a puzzle — with pieces constantly moved until the right “fit” is found. A recent report shows a slight decline in the acquisition of hospitals by each other but a steady increase in health system acquisition of services such as home care, medical group, and rehab services. At the same time, another report predicts that by the end of 2013, one-third of US doctors will be truly independent — a decline from 57 percent in 2000. These consolidations result in a frequently changing picture of today’s healthcare industry.
Horizontal consolidation of like entities — hospitals and hospitals or same-specialty physician practices with one other — is most often a strategy to produce economies of scale and to forestall competition. Collaborative care models, such as accountable care organizations (ACOs), are examples of vertical consolidation, or the banding together of different industry segments (e.g., hospitals, physician groups, home care services) to produce efficiency gains and to improve outcomes, which leads to improved financial performance.
Interoperability challenges differ with each type of consolidation. In a hospital-hospital merger or acquisition, the decision may be made to upgrade capabilities of both hospital systems by purchasing and implementing a new system to handle the data sharing and integration needs of the merged organization. Moving both hospitals to the same system is an ideal strategy to create seamless communication but there are two interoperability challenges faced by information technology (IT) staff:
The existing electronic health record (EHR) and other clinical and financial systems must be maintained and integrated throughout the implementation phase of the new system, which can take between three and five years.
All information from the multiple legacy systems located throughout each department of the hospitals must be integrated and migrated to the interim system in preparation for the new system.
While these challenges are significant, hospital IT managers have full control over the systems — the new, the old and any interim systems — which streamlines decision-making processes. The other advantage is the similarity of data in each system because both hospitals have the same reporting, claims, and financial requirements.
In a vertical integration, there may be little or no similarity in data or financial and regulatory requirements, which creates the following IT challenges:
Financial and operational constraints that prevent migration to one system for all entities;
Different regulatory and reporting requirements from a hospital’s requirements, which means existing EHRs and practice management systems must remain in place;
The need to convert data from disparate systems and different formats to enable the ability to harmonize and aggregate information that can be shared by all users;
Integration must be handled in a way that increases ease and speed of data sharing to add value to the relationships between hospitals, labs, physicians and other services.
The lack of a single healthcare informatics interoperability standard presents an additional challenge for IT staff as multiple systems are integrated. While HL7 provides a framework for the exchange of data, it is still a guideline rather than a mandated standard; it will likely be many years before the healthcare ecosystem can support a single standard for data exchange (if ever). For this reason, organizations must develop a platform that supports the exchange of information among disparate sources.
There are two approaches to the connectivity challenges faced during consolidation of multiple entities. An on-premise solution provided by hospital or ACO staff is possible, but it requires significant investment in hardware, software, space, and staff to implement and continuously maintain the system as new entities are added.
The second approach, which is financially and operationally more feasible for most organizations, is to partner with a cloud-based provider who can provide the expertise and the “space” in which data can be aggregated and harmonized to enable collaborative communications. This approach frees healthcare IT staff to focus on the organization’s daily business needs and provides a flexible platform that can easily evolve as the organization continues to change.
Mergers, acquisitions, and innovative collaborative care model development will continue to be the norm as the healthcare industry continues its transformation. Just as a jigsaw puzzle is best built on a solid surface, organizations must develop a solid platform that can support the ongoing consolidation of all pieces of the healthcare puzzle to ensure success in a collaborative care environment.
Gary Palgon, CISSP is the Vice President of Healthcare Solutions for Liaison Healthcare Informatics, which provides healthcare organizations with innovative solutions to complex integration and data management needs. He can be reached at [email protected] or on Twitter @GaryPalgon.