Healthcare IT Implications of Healthcare Reform

By John Halamka
09:14 AM

I'm often asked how Healthcare Reform will impact IT planning and implementation over the next few years.

First, some background. The Patient Protection and Affordable Care Act (HR 3590) and Health Care and Education Reconciliation Act (HR 4872)  were passed to to address several problems with healthcare in the US.   We're spending 17% of our Gross Domestic Product on healthcare, yet we have worse population health outcomes than many other industrialized societies spending half as much. Healthcare costs are rising faster than inflation. We have significant variation in practice patterns that is not explained by patient co-morbidities nor justified by comparative effectiveness evidence. We want to expand access to health insurance to 95% of the population, lower our spending growth rate, and incentivize delivery system change.

How will we do this?

Health insurance reform expands coverage, makes features and costs of plans transparent, and removes the barriers to enrollment created by pre-existing condition considerations.  

Payment reform transforms the Medicare payment systems from fee-for-service to Value Based Payment - paying for good outcomes rather than quantity of care. Pilot projects will test new payment methods and delivery models. Successful innovations will be widely implemented.

Let's look at the payment reform details that will lead to delivery system reform.

Medicare Initiatives include

  • Medicare shared savings program including Accountable Care Organizations (ACOs)
  • National pilot program on payment bundling
  • Independence at home demonstration program
  • Hospital readmissions reduction program
  • Community-Based Care Transitions Program
  • Extension of Gainsharing Demonstration

Medicaid Initiatives include

  • Health Homes for the Chronically Ill
  • Medicaid Community First Choice Option
  • Home and Community Based Services State Plan Option
  • Hospital Care Integration
  • Global Capitation Payment for Safety Net Hospitals
  • Pediatric ACOs

I believe that Accountable Care Organizations will be the ideal place to host several of these innovations including bundled payments, the medical home, and an increased focus on wellness.

All of this requires innovative IT support.  

Here are my top 10 IT implications of healthcare reform:

1.  Certified EHR technology needs to be implemented in all practices and hospitals which come together to form Accountable Care Organizations. EHRs are foundational to the capture of clinical and administrative data electronically so that data can be transformed into information, knowledge and wisdom.
2.  Health Information Exchange among the PCPs, specialists, and hospitals is necessary to coordinate care.   Data sharing will start with the "pushed" exchange of patient summaries in 2011 and evolve to just in time "pulls" of data from multiple sources by 2015.
3.  Health Information Exchange to Public Health registries is necessary to  measure population health across the community.
4.  Quality data warehousing of key clinical indicators across the ACO is necessary to measure outcomes. 2011 will be about measuring practice and hospital level quality, 2013 will be about measuring quality throughout the accountable care organization, and 2015 will be about measuring patient-centric quality regardless of the site of care.
5.  Decision support that occurs in real time is needed to ensure the right evidence-based care is delivered to the right patient at the right time - not too little or too much care, but just the right amount of care to maintain wellness.
6.  Alerts and Reminders are critical to elevate the overwhelming amount of data about a patient to action that a caregiver (or the patient) can take to maintain wellness.
7.  Home care is needed to prevent hospital readmissions, provide care that is consistent with patient preferences, and to enlist families as part of the care team. Novel IT solutions range from connected consumer health devices (blood pressure cuffs, glucometers, scales) to wireless telemetry informing clinicians about compliance with treatment.
8.  Online access to medical records, secure communication with caregivers and customized patient educational materials are needed to enhance workflow, improve coordination, and engage patients.
9.  Outcomes are challenging to measures and we'll need new innovative sources of data such as a patient reports of wellness, exercise, and symptoms.
10. Revenue Cycle systems will need to be significantly modified as we move from fee for service models to value-based payment and gainsharing when ACOs deliver higher quality care for less cost.

So there you have it - find the PCPs, specialists and hospitals you want to form an ACO then fully implement EHRs, PHRs, Quality Data Warehouses, Health Information Exchange, Decision Support Systems with alerts and reminders, homecare support including consumer healthcare device interfaces, and new revenue cycle systems. Luckily this is well aligned with Meaningful Use Stages 1,2, and 3, so you'll be doing it anyway.

For IT professionals, we truly live in interesting times.


John Halamka, MD, blogs regularly at Life as a Healthcare CIO.