In this episode, we are joined by Matt Michela, President and CEO of Life Image, to discuss the ONC’s new info-blocking rules and what they mean for providers.
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Highlights of this episode include:
- Background on the ONC’s new info-blocking rules and why they are increasing the urgency around interoperability concerns.
- What repercussions and fines can providers expect from not following the ONC’s guidelines?
- Why there is a reliance on older technology, such as CD-ROMs, to exchange data and images between providers and patients.
- Examples of compliant alternatives to CD-ROMs.
- What cost savings can providers see when moving from traditional media to digital?
- And more…
Mike Passanante: Hi, this is Mike Passanante and welcome back to the award-winning Hospital Finance Podcast®. Healthcare interoperability is still a work in progress. Recently, the Office of the National Coordinator for Health Information Technology released new info-blocking rules intended to further facilitate the exchange of healthcare information. However, many providers still rely on legacy systems and technologies that will make it expensive and difficult for them to comply with these new rules. To explain what these new rules mean for providers and what they can do to optimize their capabilities while improving their bottom lines, I’m joined by Matt Michela, President and CEO of Life Image. Matt, welcome to the show.
Matt Michela: Thanks, Mike. Good to speak with you today.
Mike: Matt, we all know interoperability has been an issue for some time in healthcare. Can you give us an overview of the ONC’s new info-blocking rules and why they are increasing the urgency around interoperability concerns?
Matt Michela: Sure, absolutely. So I guess I would say non-interoperability has actually been the great concern in healthcare for a long period of time, right? At least as long as I’ve been involved in healthcare for the last 30 years or so. And I think these challenges we’ve recognized– 30 seconds of history. In the end of the Obama administration, a bipartisan group of congressmen came together, right, to basically lay the foundation in place legislatively for dealing with data blocking and non-interoperability in healthcare, recognizing the real barriers to care and cost management that was driving across our healthcare system. And that was picked up in the Trump administration that continued in a bipartisan way to advance that legislation and move it into the regulatory process which resulted here in the Office of the National Coordinator writing down a record promulgating for a long period of collecting feedback from the industry, a set of rules that really put in place new requirements for the industry to drive better transparency and data, better access to data. And it had just a couple of components, I think, that are important here. One was it really leaned heavily into kind of the technology sector and establishing what healthcare technology standards would need to be deployed in order to ensure that we’re all, as vendors, right, starting to– that we have the ability to talk to each other and to work together. Because when we talk about healthcare standards, there’s so many– or data standards. There’s so many data standards in healthcare that our problem is not that we don’t have any standard, it’s that we have so many. And so every manufacturer, every software company, right, creates their own mechanism of understanding and storing and sharing data and if it doesn’t match up with what another vendor has used, boom, it’s not interoperable and you can’t see it and access it. Kind of like in the old days, right, where if you used a Mac, you used a Mac, and you couldn’t share your spreadsheets with somebody that used an IBM machine as an example. They became more interoperable. Healthcare is evolving into that space. So they obviously leaned into the technology standard and said, “All right. We’re going to tell everybody this is the standard you have to use, do whatever you want inside your own systems. But ultimately, you have to be able to expose data, right, using a category of a standard, right, in creating what are called APIs, which are standard ways of kind of understanding data and being able to see it, access it. So that is a very, very big deal to work through that kind of technology kind of mechanism here so that industry knows going forward what they have to do most efficiently. The second was this kind of category of, okay, now that we’re taking away industry’s barrier or excuse around the technology side of the house– yes, they have to build into it, but we’re not going to argue about healthcare standards or create new ways constantly doing it at this stage– was, let’s put in place– let’s lean into behavior, right, at data blocking. Right? For organizations that may, for their own purposes or their business model purposes or for a lack of priority, right, they just don’t give data to patients here. And ultimately, in health care, becoming more consumer oriented is a good thing. In almost every other industry it drives quality up and costs down, and so meeting this need of consumerism means you have to have access to data and patients have to do that. So the ONC basically said, “All right, here’s your technology you have to use.” They created, right, the first minimum, right, set of data. So they basically said, “Okay, and these are the types of medical information you have to be able to provide.” Right? So patient history, demographics, lab information, basic imaging information, diagnosis, pathology, claimed costs, et cetera. It’s not all of the types of health care data, and it’s pretty much kind of the low hanging fruit that people know how to deal with most easily today, but it’s a start. And they said, “This is your common data standard,” and then they said, “You have to share it with patients. And if you don’t, there will be compliance and regulatory consequences here, including what could be very, very substantial fines. So industry, start working towards that and move forward.” So that’s what the ONC has principally put in motion here, and it applies to providers, as we talk about here, as you mentioned here, but it also applies to health care insurers and payers that have their own set of requirements. That ultimately means, as a subscriber or a member of a health plan, you’ll be able to relatively soon request five years of your payment history from anything from their system. So that should allow exposing the cost and what plans have paid for services here is going to be a big missing– is going to fill a big missing gap we have for consumers to understand how to price shop and understand the consequences of their health care decisions. Now to the second point, Mike, and I know it’s a relatively long answer, but the urgency around this– there’s always been urgency, but particularly this year, I think the industry has come to understand pretty dramatically because of this pandemic the real consequences of having non-interoperability, right, in health care here. When we look at COVID patients as an example, and the CDC had done a study in the first wave of the pandemic was saying, “When patients show up and they’re initially diagnosed with COVID, does that patient have their medical records available for the physician to then be able to determine, what is their history? What are their particular issues of comorbidities or complications so they can apply appropriate treatment plan given their symptoms?” And less than 6% of all patients that presented and were diagnosed with COVID in that early period of time had any access to their medical records at all. So with this disease and that’s so varied, and so complicated, and attacks so many systems in an area where physicians had to really deploy, apply, right, their greatest judgment for 94% of all patients showing up, the physicians had to go into that battle without the data they needed to be able to treat the patient, right? That caused an untold number of patient harm here of suboptimal care and kind of an added cost. And so it became very dramatic, I think, to much of the delivery system, the clinical side, that this wasn’t a theoretical conversation or an inconvenience, right? Not having access to this medical data, not very small subset of patients, but for the majority of patients is a real quality care issue that ultimately has to be solved. And we haven’t solved it yet. But I think throughout the course of this pandemic, it’s become more and more apparent that this is not just required, but it is essential and that we have to hurry up and get this done. And I think the ONC has set a fantastic table and foundational building blocks to guide industry to get that done.
Mike: Great overview, Matt. And you mentioned in your answer a little bit about the fines and some other issues, repercussions, if you will, that can come up when a provider does not follow the ONC guidelines. Are you able to provide any additional detail on the repercussions of not following the new ONC rules?
Matt Michela: Sure. I mean, some of these financial penalties, right, can be in the thousands or ten thousands of dollars, even upwards to a quarter of a million dollars penalty for blocking data for individual patients. So when you think about a practice that may have themselves thousands of patients or tens of thousands of patients, right, a typical primary care physician, right, and again, that’s not the typical kind of data we’re talking about, but may have a panel of two, three, four thousand patients across the board here, these fines mount up substantially, right? And you don’t see to date has been relatively, and by to date I mean this year, has been relatively careful and kind and gentle about many of these enforcement actions by delaying the implementation dates that are required for healthcare technology companies to comply, right, giving them some relief in the pandemic. But nevertheless, the penalties there are really substantial. And what will happen over time on the provider side that we really have to be aware of, right, is in the past, some of your business practices block data and you didn’t even recognize, right, you’re doing it in a relatively large bureaucracy or with some policies in place. The consequences, the fines for that can be substantial. And before where you might have a patient that is a little bit inconvenienced or a little bit aggravated because they have to run around or under these rules, right, if a patient comes to you and says, “I want my data and I’m using this technology platform, this app as an example to collect my data, I’m not coming into the office, transfer it to me.” Many health care organizations historically would say, “No we’re not doing that, right? Our internal policy is no, you have to come in the office. You have to sign consent forms. You have to travel around. We’ll get it to you in a month or two months.” Those are all violations now. Providers have to supply that data. They have to provide it digitally in the means that the patient has requested it, assuming that they’re capable of doing that here and they have relatively stringent time constraints. We had and set it about 30 days but are moving, right, down to even two weeks or 15 days of a turnaround time. And I think what we’re going to find as an industry right on the provider side is that patients are going to get more local. Patients are going to– sorry, they’re being educated and are going to recognize they have rights in this regard. And they’re going to be the ones starting to notify the OMC and the compliance folks and CMS and Health and Human Services that their providers are not complying here. And this sense of patients reporting really does increase the risk. We’re moving past the place where patients are kind of historically complacent and will listen to their provider directions and much more into a consumer-oriented world where they expect responses quickly, immediately, efficiently and will start to complain if they don’t get it in larger numbers. And so as a– and as a provider, we’ve got to pay attention to this, right, because it’s very easy to get behind. And the next thing you know, you’ve got pre-patient complaints that get researched and find out that it’s been your normal business practice and affects 15,000 patients. And all of a sudden, you’re in a huge financial problem here. So you have to be very careful with that.
Mike: Matt, I want to pivot a little bit and talk about a specific area of data exchange when we talk about maybe getting behind. Given the need to streamline access to this information, it’s actually surprising that CD-ROMs are still used as widely as they are in healthcare to exchange data and images between providers and patients. Why is there still a reliance on this older technology?
Matt Michela: Great question, Mike. And when you look at the transfer, the exchange, the sharing of medical imaging here in the country, despite the fact that the technology has existed, right, to digitize it and effect a secure encrypted transfer without any degradation of the data – and that’s existed for almost a decade and a half leveraging the advantage of the category – It’s not a technology question in that it’s not mature. It is. It really is a couple of other drivers, right? One is a little bit inherent kind of delay in adoption of new technology by the delivery system, right? And folks continue to talk about the fact that we have fax machines out there. The next horrible example behind fax machines, right, is, unfortunately, CDs here for imaging. So as a matter of practice, that’s what they always did. That’s what they continue to do. That’s what their internal policies are set up to do. In many regards, it’s what people’s full-time jobs are to do. And so evolving out of that in the practice requires diligence and attention. And sometimes, it just hasn’t occurred quite frankly across the industry. The second kind of, I think, factor here, again, is a tolerance in the industry for non-interoperability. CD-ROMs, right, for imaging is a classic example of non-interoperability. Not only are there significant delays in acquiring them and producing them and were inconveniences to patients who are running around or are mailing them around, which is not as secure as it needs to be, generally, somewhere around 12-ish percent of all medical imaging that’s actually put onto a CD can’t actually be read by the physician, the group, the practice manager, etc., who has to take it and upload it and make it work, right, because the viewer isn’t quite right. The standard isn’t quite right. The disk ultimately is corrupted. It’s 3D that’s too big to fit on a CD ROM or even a DVD, right, as the technology has evolved. So even all of this effort to produce them and move it around on physical media still has material problems when you could push a button and transfer it, right? But as an institution, right, what we find is they look and they say, I’m a typical, large scale hospital and I’ve got lots of things going on. I’ve got lots of departments. Every department may be operating independently. That’s another barrier because we work with organizations that are incredibly sophisticated in digitizing their imaging and moving it around but they still have pockets of departments and practices and geographies, right, where they’ve never implemented that technology and so they’re relying on CDs. So it’s just the nature of the organization itself and how unified they are with their technology can also be a barrier to affecting some of this change and dumping the disk and digitizing what you need to do. It’s maturing, but nevertheless, still another challenge. Another component is typically in some of these organizations, you’ll have the part of the company that’s responsible– part of the delivery system that’s responsible for the image management, right? Tends to be in what they call the PACs administrator function. And they’ve got a budget and they have to pay for hardware and software and all of the rest of these kind of issues here. And if they have an image exchange partner, they’re paying a vendor and they’re paying that vendor a certain amount of money. And the more you digitize, the more you pay that vendor. So there is this unfortunate, perverse dynamic in some parts of the industry where the cost of CD management production sits out in the clinical areas, sits out in the department and is dispersed. Right? That cardiology may have a full time person doing it and appointments in oncology get delayed a week because they don’t have the images they need to schedule an appointment. Doesn’t affect my budget if I’m running the IT department in a PACs administration, right? But if I digitize it all, my budget goes up and I may not get credit for that or appreciated. So part of this issue, unfortunately, in some parts of the industry, are that the cost of these CDs, both in delays in scheduling and effects on revenue and impacts to patient care, is dispersed. But the actual cost from a technology point of view isn’t and it’s not aligned and that misalignment then takes more time, right, for organizations to get their hands around it, understand it, and then push forward. Another kind of issue here that has contributed to it is a bit of lack of priority because, again, since the accountability and the consequence of managing CDs, it may not be mine, right, in the technology world here, but it is the ability to implement brand new HER across the system or problems that have a revenue cycle management and technology there or billing issues I have. And so those issues tend to be bigger, much more impactful, sometimes hundreds of millions of dollars to solve. And they get the priority and the attention where the interoperability around imaging might fall fifth on your priority list or tenth or fifteenth. And so year over year, it gets slightly less attention. It takes a lot more effort, right, to get people to react to it across the board. Having said that, I mean, so even with our company, today, nevertheless we still have 13,000 facilities in the US who are digital. And we’re doing that every month for 12 to 15 million patients that are being referred around within the United States. So it’s being addressed at scale, but nevertheless, still, more than 50 percent of all imaging is still at CD. So there’s a long way we still have to go for those reasons.
Mike: And Matt, what are some compliant alternatives to CD-ROMs at this point?
Matt Michela: So, I mean, quite frankly, there’s a number of companies that operate in the space that offer software solutions that will connect directly to your PACS. We’re very sophisticated, either integrations into your existing EHR, which we do, and all the major EHRs so you don’t have to modify your workflow. Or lots of other flexibility to basically work off your workstation to search on a patient, acquire imaging, push a button and then transfer it to almost anywhere in the world that you want it to securely. Those solutions exist. It really is a question of just applying them. Again it’s the priority of your organization. What we found, right, at least at our company here during this year, was especially early on when the pandemic was starting, was in its first surge. Since Life Image is so heavily penetrated and the large institutions and academic and tertiary care centers and in all of the major metropolitan areas in the country, that’s where covid hit. And so, our customers were materially affected right away out of the first wave. And they recognized very early on that they really did need to be more interoperable for imaging. And we received a massive amount of requests to connect into new delivery systems, new sites, temporary field hospitals, etcetera. And in the course of three to four months, we connected virtual– I think it was somewhere in the range of 500 brand new hospitals right on the Life Image Network. Again, because of this awareness, we have to solve this problem. And so, in that period of time, right, we were just working really, really hard to advance that. That’s slowed down a bit now towards the second half of the year, which is kind of interesting, and I think is more reflective of advancing onto other types of treatment with both covid as well as returning to elective procedures here.
Mike: Matt, I suppose where you could see where there would be some low hanging fruit around operational efficiencies, over CD-ROMs. Are there any cost savings for hospitals that want to move away from CD-ROMs and into this more digital world?
Matt Michela: Sure, it’s material cost savings here. It’s not, I mean, on a margin basis, right? It’s important, right? Depending on which type of institution you are, a management of a single CD-ROM is going to cost you somewhere between $8.00 and $16.00, right? With larger facilities, with the more efficient workflows, with some of the centralized tools, with managing CDs, we’ll get it down to $8.00. Smaller facilities, midsized facilities, more rural facilities, etcetera. Folks that are managing CDs on a part-time basis along the way, it could easily be $16.00, right, for each CD. And that’s the handling, the purchase, the burning, the equipment, the staff time. So in comparison, if you digitize it, right, not only do you get– you’re basically lowering that cost, right, at scale for large institutions, for well below a dollar here. And that’s a massive marginal savings across the board when you talk about large scale institutions here. In smaller institutions that are looking for every single dollar in this terrible health care experience, right, it’s got a very clear ROI if they can pay attention to it. So it’s a very inefficient– or a very efficient-scale way, to digitize, get rid of those CDs here and make that work. So the issue of course is– in pure oil. So while this might be an eight-to-one or a sixteen-to-one savings, you know? Or rely on it in raw dollars, right? It works. What problem you’re going to have with your data system in Epic goes down, or something’s not picking up. So that’s one of the reasons organizations get confused about this. But real cost-saving. So that’s before, Mike, we talk about the impact of patients, right? And care. Which is quite frankly, it’s unmeasured here. But we have a number of institutions, right? That deal with oncology as an example. And in many cases, right? They won’t schedule a meeting with a patient. They won’t take an outside referral for initial diagnosis or for a second opinion. And let’s say, already have in hand, a patient’s medical records. And you’ve got a number of institutions that want five years of history within it. And so as a patient, you may spend 30 days collecting that information before you can actually have an oncologist come in and view it and discuss it with you. And there are cancers that cannot wait 30 days. There are cancers that progress, aggressively, in that 30-day period of waiting, right? Causes real issues. Causes significant cost in the background. Here, that’s not– this 18 to 16 dollars, a physical CD doesn’t account for that patient care opportunity, or the added cost to the healthcare system because a disease has progressed during that period of time. We have 150 stroke centers that we support, at the United States level in trauma treatment centers. And the use case here is a patient pretense in the community. And this image. And then the patient needs to be transferred to a Level 1 Trauma Center for treatment. Well, when you’re talking about stroke, again, whether it’s a bleed or a clot, right? Every minute are millions of brain cells. And so, for the image, right? We have the ability to take that image from the community pile, transfer it to the trauma center so that the team at the– care team there can analyze it, understand it. While the patient is still either inpatient community center, or frankly, in route in ambulance, or by helicopter. And to transfer that data to that staff. So that the physicians can determine what an appropriate treatment is so the patient can be treated before they even roll a door, right? Whereas unfortunately, there’s still many, many facilities in the country where the patient will be imaged and they slot that CD-Rom and tape it to their chest, and then roll out the door. And then the care team is the first time to see that data. They can spend 12 to 30 minutes in extracting the data, trying to understand it, take a look at it, and treat. And that kind of– in that kind of clinical condition, right? It’s the difference in many cases between whether the patients live or die. It’s the difference between whether Health Plan has to pay a million, or two million, or five hundred dollars for additional rehab that could’ve otherwise been avoided. So the acceleration of data, especially around imaging which is so important now, in almost every significant medical issue that we have today, is fundamentally, right? A clinical care quality of care issue, right? And it has an 8 to 16 to 1-hour life if you do it. So, this is why we come to work every day, is we recognize that this isn’t just a software issue. This is really a– this is a quality care issue for millions of patients every single– day here. And continue to advocate for this digitization and new operability, right? It’s an advocation, not just a professional expense.
Mike: Great stuff, Matt. If someone wanted to find out more about you, or Life Image, where can they go?
Matt Michela: Thank you for asking. So, you can go to lifeimage.com, which will take you to our website that will explain the services, the products, the markets, etc, we’re at. Gives you the availability to ask additional questions or talk with anybody internally at the organization that is required. Not just the salespeople, but technical folks, or whatever. So I would direct you there as a start.
Mike: Matt Michela, thanks for coming by the Hospital Finance Podcast today.
Matt Michela: Thank you, Mike, appreciate it.