Transcript Document

University of Minnesota
Information Technology in
Healthcare
Medical Industry Leadership Institute
Course: MILI/PUBH 6562
Fall Semester B, 2014
Stephen T. Parente, Ph.D.
Carlson School of Management
Department of Finance
[email protected]
Class # 2 - Translating Demand into
Information Systems
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Economic evaluation of Health IT industry
How do data & medical care fit together?
Health information systems portfolio.
Lab #1: Identifying a vendor-supplied
application.
• Primer on systems evaluation.
• Information Technology Overview
Demand vs. Need
• Economics definition of demand: The amount
of a good you’ll demand at a given price,
holding all else constant.
• Need: What you want (regardless of price).
Prefer Information Demand Rather
than Need
• You are taking into consideration the price of
the information ‘good’ you are buying.
• You have some implicit ‘utility’ of the
information you are buying and know the
trade-offs between buying more information as
opposed to other resources (e.g., labor).
Information Demand Curves
What do they say about the willingness to pay for info?
Price $10M
quoted
for info
McConnell
Memorial
Reid
Memorial
1 5 10 15 20
Ad Hoc Reports Demanded
Why Different Curves?
• Reid has set as a goal to complete 19-20
formal analyses per year.
• McConnell would not buy as much data when
the price is steeper.
• Other reasons?
What Creates Information Demand?
• Management seeks to identify sources of:
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Higher/lower cost
Higher/lower quality
High productivity (greater output, same inputs)
Higher efficiency (greater output, less cost)
• Required for Compliance
– Government
– Institutional
• Interest in Research
How Much Information is Demanded?
• Depends upon situation:
– Is it required?
– Will it need to be updated continuously to be
valuable over time?
– Will it have other unforeseen purposes?
– Are there partners to split the cost of getting the
data?
– Will obtaining this information provide ‘too much
information’?
What Will Effect the Value
of Information? - 1
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It’s not just data, it’s information
Relevance (want to compare apples to apples)
Sensitivity (broad numeric categories may not do)
Bias (systematically observing the wrong patients)
What Will Effect the Value of
Information? - 2
• Comprehensiveness (everything you need to
know)
• Timeliness (when you need to know it)
• Action-oriented (to fight the right fight)
• Performance-targeted (and claim victory)
• Cost-effective (so that an accountant won’t
blush)
Next Up: Data and Medical Care
How do they fit together?
The Days in the Life of an
‘Medical Encounter Record’
The Players
Junior
Dr. Bob’s Office
Dr. John’s Office
Junior’s Mom
The Hospital
Dr. Bob, Pediatrician
Dr. John, Surgeon
The Insurer
Today’s Encounter:
The Tonsillectomy
• Junior says he’s feeling sick.
• Mom decides to take Junior to the Pediatrician
• Dr. Bob (the Pediatrician) decides Junior needs to
have his tonsils out.
• Bob’s office bills for the office visit
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“ “ bills for throat culture
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“ “ makes a referral for Junior to see Surgeon
• PPO pays for visit & culture
• PPO approves Dr. Bob’s referral
• Surgeon John evaluates Junior for surgery.
• Talks to mom about prior medical history and
scheduling.
• Dr. John has administrative assistant set up
appointment at the hospital.
• John’s office bills for the consult
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“ “ sets up surgery date for John w/Hospital
• The hospital admitting department sets up a record
for Junior
• PPO pays for consult
• PPO approves Dr. John’s choice of hospital for
surgery.
• Mom takes Junior to the Hospital’s Admitting
Department.
• Admitting checks Mom & Junior’s health insurance
coverage (Mom is primary insurance holder).
• Admitting say they’ll admit Junior to stay
overnight.
• Mom says Dr. Bob though it was a same day
procedure. In addition, Mom is concerned about
paying an inpatient deductible.
• Admitting calls Mom’s PPO
• PPO customer service representive queries the
online ‘membership’ ship. Mom has great
coverage.
• Admitting tells overnight or same day are covered
at the same copay.
• Mom prefers same day.
The Operation
• The Hospital submits lots of bills
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Lab work
Blood
Anesthesia
ER room time
Supplies
• Surgeon John submits a claim for surgery.
• Dr. Bob submits a claim for IP consultation.
• Internal hospital systems affected:
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Inventory
Payroll
Accounts receivable
Medical records
• PPO reimburses hospital.
• PPO reimburses Dr. Bob
• PPO reimburses Dr. John
The Recovery
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Junior has a follow-up visit with Dr. Bob
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“ “ Dr. John
Dr. Bob submits claim for visit.
Dr. John submits claims for visit
PPO pays Drs. Bob & John
OTHER POST-OP
• Hospital pharmacy bills for pain medication
• Mom’s Flexible Spending Account pays for drugs.
• Lots of ice cream from Mom.
The EMR ‘Paper’ Trail:
Insurer/PPO Perspective
Patient IDProvider ID Proc $$$
DOS E/P Owner
Junior
Bob
92010 $50
4/03/12 EB.Off.
Junior
John
92040 $100 4/05/12 EJ.Off.
Junior
Hospital 350
$4200 4/10/12 EHospital
Junior
Hospital 350
-$4200 4/10/12 EHospital
Junior
Hospital 350
$2000 4/10/12 EHospital
Junior
John
43250 $2100 4/10/12 EJ. Off.
Junior
Bob
92030 $50
4/13/12 EB.Off.
Junior
John
92030 $75 4/16/12 EJ.Off.
Junior
Hospital RX200 $160 4/10/12 EHospital
Finding the Value of Information
Using the IS Portfolio Profile
• The IS Portfolio:
– A set of IS applications used by an organization
– Result of choices made over years
– Represents a finite number of categories
• The IS Portfolio Profile:
– Representation of relative importance of the
categories
HISP Strategic Performance Evaluation Approach
IS Categories
Lab #1: Identify a Vendor-supplied
Application
• Parameters:
– Client: 300 bed hospital
– Must have software features:
• Computerized master patient index
• Computerized order entry for laboratory, pharmacy and radiology
• Be suitable for (coming) federal interoperability standards
– Operating system: UNIX or Windows Server
– Must be Health Level 7 (HL7) and Meaningful Use compliant
• Assignment:
– Research using all available resources (e.g., WWW, LEXIS-NEXIS)
– Write a 1-2 page executive summary describing UP TO THREE possible vendors
and their approximate costs & include URL references(s).
– Describe CAUSAL link between system objectives & features.
– Due November 4, 5pm by email with comment – 6562 Lab #1.
The Information System
Development Process
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Systems Analysis
Select Design Approach
Design
System Implementation
System Maintenance
Information System Development Process - 1
1. Systems Analysis
• Review current information system
• Are you creating a new system of modifying a
new one?
• Establish the system requirements
• This is a process where one collects facts about
the system REQUIREMENTS and the
ENVIRONMENT it will function in.
Information System Development Process - 2
2. Selection Design Approach
• In-house
• Vendor supplied
• “Pick your architect”
Information System Development Process - 3A
3. Design
List the following:
a. System objectives
b. Output specifications
– Purpose
– Content
c. Input specifications
– Data
– Forms
– Coding Conversions
Information System Development Process
3. Design - continued:
D. Master File(s) Specifications
– Content
– Security
E. Procedures and Data Flow
– Identify the ‘cogs’ of the machine
– Use flow charts to describe how chart ‘A’ gets to
decision support system ‘G’
Information System Development
Process - 3C
3. Design - continued:
F. Cost-Benefit Analysis
– Development costs
– Operating costs
– Maintenance costs
– Benefits
» Work hours saved
» Adverse drug reactions avoided
» Increased patient demand
G. Management Approval
Cost/Benefit Example
• When does MicrohealthTM IS investment
breakeven at Clinton-Cruz Hospital?
– One time costs: $500K
– Annual costs: $300K
– Revenue Projections: $40M @ year
– Expenditures Projections: $35M @ year
– Labor cost w/Microhealth @year 2 million
– Labor cost w/o Microhealth @year 2.5 million
Information System Development
Process - 4
4. System Implementation
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“The Construction Phase”
Write or buy software
Buy new equipment
Hire and train new staff
Convert all data files (or paper records) for your
system
• System testing
Sources of Information on Vendors and Software
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Directories and Guidebooks
Exhibits at Professional Association Meetings
Internet
Direct Contact with Other Users
Hardware- and Software-User Groups
Consulting Firms
NETWORKING
Packaged Software Evaluation Criteria
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Congruence with organizational requirements
Level of satisfaction of other users
Compatibility with existing hardware & software
Ability to interface/integrate with other apps
Support available
– Training, documentation & maintenance
• Costs
– lease, add-ons, set-up fees, maint. costs
• Financial stability of vendor
Out-sourcing score card
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Prior experience
Financial stability
Credentials of personnel
Uses principles of system analysis & design
Thoughtful cost estimates vs. ‘how much do
you have?”
Information System Development
Process - 5
5. System Maintenance
• Often ignored
– Problem: once operational…..
– WHO CARES?
• Evaluation:
– Are objectives being met?
– Was the cost/benefit projection correct?
• Re-engineering plan
Health IT Hardware Overview
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Computer Components
Virtual Components Tour
Evolution of Health IT Processing
Network Fundamentals
Data Switches for the Health Internet
The Health IT Pyramid
Decision
Support Software
Life Support Software
Clinical & Financial Data
Hardware
‘Hands On’ Components of Health Information
Technology
Major Components of a
Computer System
Primary
Storage
CPU
Input
1. Arithmetic/Logic
2. Control Unit
3. Registers
Secondary
Storage
Output
Information
Control
Central Processing Unit (CPU)
• Arithmetic/Logic Unit
– e.g., if diagnosis=‘diabetes’ then count patient
• Control Unit
– home of the machine code
• Registers
– place-holders within the CPU as it processes data.
Primary Storage
• Core memory:
– Read-only memory
– Random-access memory
– Cache memory
• Started off being very expensive
• Extremely cheap today relatively to a few
years ago (32 MB, $1,280 in 1993; 32 MB,
<$1 in 2014)
Secondary Storage
• Magnetic disks (e.g., Hard drives)
• Magnetic tapes (e.g., Tape drives)
• Optical disks
– CD (700 MB)
– DVD (4,300 or 4.3 GB)
– Blu-Ray (25/50 GB)
• Smart cards
• Solid state drives (e.g., SSD / USB drives)
Input Devices
• Keyboard
• Pointing device
– mouse
– trackball
– pointing stick
• Scanner
• Handwriting recognition devices
• Voice input
Output Devices
• Printer
– Dot matrix
– Laser
– Inkjet
• Monitor
• Speakers
Welcome to Prof. Parente’s
Enterprise Server (Museum)
Motion
Activated
Security
MultiProcessor
Servers
Satellite
Uplink
Secondary Storage
Dual Mainframe Tape Drives
Secondary Storage:
Mainframe Tape Drive
One of Eight Server Fans
I/O Peripheral Slots
Dual Processors & Heat Sinks
Basic PC Entrails
CPU
Connecting the Computer to
Input & Output Devices – Old School
Keyboard
Video Port
Serial Ports
Network Port
Speaker & MIC
SCSI Port
Secondary Storage II
Floppy Drive
Hard Drive
Secondary Storage III
SCSI/SATA
Hard Drive
DVD
Primary Storage
Peripheral
Slots
RAM
Power Supply Backup & Modem
Modem
Uninterruptable
Power Supply
(UPS)
Mainframe – Original Workhorse of IT
1970s - Setting the Stage for Bigger Things
• Hardware innovations opened up new
opportunities:
– On-line computer systems
– Still used batch for big jobs (payroll)
• Minicomputers
• Packaged systems
1970s - continued
• Packages developed:
– accounts receivable
– admissions
– bed census
– inventory control
– medical records
• Turn-key packages: Vendor supplies hardware, software,
installation support and training.
• Shared systems
– use a ‘hub’
– use terminals
– forerunner of networks
1980s
• Microcomputers make rapid advances
• Institutions faced with more managers wanting
systems tailored to their needs.
• Led to Balkanization of HMIS. Why?
– Technology is cheap
– Hospital departments start buying their own stuff
– Although stuff was cheap, the new product cycle
rapidly accelerated.
1990s-Realizing integrated IS
• Radical market change in health markets has
completed radical in IT change.
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mergers
integrated delivery systems
Health reform’s promise, threat and debris
Health data standards
Internet/intranet capability
Privacy & security issues
Consumers enter the health care market informed with
MEDLINE data and clinical data from the web.
Intel processor mainstream
purchase timeline: 1981-2000
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1981: 8 bit XT 8086
1987: 16 bit AT 80286
1990: 16 bit 80386
1993: 32 bit 80486
1995: Pentium (80586)
1997: Pentium MMX/Pentium Pro (80686)
1998: Pentium II (80686 w/MMX)
1999: Pentium III (80686 Slot 2)
2000: Pentium IV above 1 Ghz.
Overview of Networks
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Central Mainframe Configuration
Client/Server Computing
File/Server Architecture
Distributed Data Processing
Central Mainframe
Client/Server
HSI Client-Server Platform
Cooling Fans
RAID Defined:
Redundant Array of
Inexpensive Disks
RAID Disk Array,
6 Drive Bays
Multi-purpose Servers
Distributed Data Processing
Network Topologies
• Bus topology
• Ring Topology
• Star Topology
Software Fundamentals
• Programming Languages
• System Management Software
– Operating systems
– Utility programs
• Application Software
– General office suite
– Statistical analysis
– Custom, visual programming design tools
Programming Language Evolution
Generation Characteristics
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Machine Language (0,1)
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Assembly Language
3
Procedural Language
4
Application Language
5
Natural Language
System Management Software
• Operating Systems
– UNIX
– LINUX
– Microsoft (Windows XP, Vista, Server 7)
• Utility programs
– File management
– Anti-virus
– Backup and security
Internet Networking 101
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LAN (local area network)
WAN (wide area network)
EDI (electronic data interchange)
TCP/IP (Internet protocol)
TCP (Transmission control protocol)
Circuit switching
The IS-way: Packet Switching
Multicasting
Lab #1: Identify a Vendor-supplied
Application
• Parameters:
– Client: 300 bed hospital
– Must have software features:
• Computerized master patient index
• Computerized order entry for laboratory, pharmacy and radiology
• Be suitable for (coming) federal interoperability standards
– Operating system: UNIX or Windows Server
– Must be Health Level 7 (HL7) and ICD10 compliant by 2012
• Assignment:
– Research using all available resources (e.g., WWW, LEXIS-NEXIS)
– Write a 1-2 page executive summary describing UP TO THREE possible vendors
and their approximate costs & include URL references(s).
– Describe CAUSAL link between system objectives & features.
– Due November 4, 5pm by email with comment – 6562 Lab #1.