This is an interesting opinion piece and partly I agree and part not but there is big bubble out there and not all will survive as we have innovation coming out our ears, but not enough collaboration.  We are already starting to see this with complicated imagemedical records system and it’s still going that way.  Mobile health is about the same if not worse with everyone having an app for every ache one has or how to exercise better, or how to find your insurer and programs that report back data with devices.  Everyone wants the winning edge here and there are those doing better than others but none are a clear outstanding winner in the long run as tomorrow one can be dethroned in a heartbeat. 

The payer side of this and cost for IT services is huge and there are tons of duplicated services there and this is one of the reasons care is so high as we have to satisfy all those transaction charges.  Cheaper drugs too are part of the expenditures but the IT side is one that many do not understand and time after time services and software are “over bought” and piece mealed  together.  This is where the real CIO comes in handy with server knowledge and cloud applications but there are not too many out there that are really well versed on everything as it takes a ton of studying and in the meantime the cost for Health IT keeps rising, again in the background and mostly out of site. 

WHAT IS THE WORLD OF HEALTH IT GOING TO DO WHEN EVERYONE RUNS OUT OF MONEY?  The answer is to get better software and cut out the transaction fees that eat us up alive.  Insurers like it though and even own some of these technologies too so it adds to their bottom line.  Actually Dr. Berwick is pretty intuitive in looking at this area with Medicare first of all with the Innovation Center as he sees it’s a big problem.

CMS Introduces The Innovation Center for Medicare & Medicaid–A Place for Collaboration

Dr. Berwick still has these folks from the 70s though in Congress that are not up to speed and ask for information from him that is public record.  These are wholly the “non participants” lacking general consumer IT literacy that are making laws today and it is scary as the tech folks on the internet talk about them all the time and this lack of technology and resistance to learn. 

Medicare Chief Berwick Scheduled to Testify Before Senate Finance Committee Next Week- A Witch Hunt or Collaboration?

Dr. Berwick in establishing this center will be employing some real Algo Men as he will need them to make it work as well as individuals who are committed to establishing solutions to real day problems.

I see it all the time even in small offices where practices are over paying for what they need and I mean this outside of a medical record program and am including the red tape practice management, billing, claims, etc. part of all this.  Some hospitals are at the crisis end of things right now, that is why we have private equity firms buying them up for a deal to turn around and make profits, but they don’t get healthcare though and only look at investments so best we can hope for is one or more of the investors to get sick and see what some of their actions and advice creates.  I always say there’s nothing like first hand experience. 

We can’t keep spending on software and consulting at this current rate and need some relief there too.  This brings me back to the intent of the post with the Medical Group Management Association's annual conference keynote from Dr. Bill Crounse of Microsoft and he makes the point very well in the fact that the need for the $150 million dollar systems need to come to a close.  He stated other countries pay far less and have better working Health IT systems.  If you read the link below you can see where I spoke to a professor in Germany who was here in the US and how we compared notes.  We are flat out oversold here on software and have a huge glut. 

Innovation Without Collaboration Is Fouling Up The US Healthcare IT System–We Need Both As We Can’t Stand on Innovation Alone

In time when all are broke that Health IT  bubble will burst when the cost is no longer sustainable and a recent report stated many doctors are getting ready to retire or do something else as when you have human lives to care for and face the Monday morning “software and analytic” quarterbacks, it’s not easy and further more it puts many in a spot of not liking their job at times due to the structure.  That is a sad state of affairs but look around as it’s happening all around you every day.  We don’t seem to be able to let Health IT take a normal and procedural course for improvement without constant distortion, overselling and viral marketing that interrupt the process.  BD 

As a result, 2011 will spark a five-year boom in IT spending. McKinsey, a consultancy, estimates that it may cost American hospitals up to $100,000 per bed to comply with the new rules—most of which will not be reimbursed by government subsidies. Health insurers may spend more to comply with the new rules than they did to sort out the Y2K software bug a decade ago.

Ah, but the reason she thinks cloud computing will be vital is revealing: capital constraints. Health providers and insurers are about to be hit financially as HIT requirements kick in just as the health reforms passed by Congress in 2010 squeeze margins. ObamaCare caps the profits of many insurers (by requiring that they spend 85% of premiums on actual care, rather than on paperwork or padding profits). And the subsidies offered for hospitals to embrace HIT do not come close to covering the likely cost incurred.

How bad could this get? Jonathan Bush, a cousin of George Bush junior and boss of athenahealth, an HIT firm, predicts that 2011 will be bloody: “Hospitals will enter a financial crisis on the scale of the subprime mortgage crisis.” He observes that hospitals are already gobbling up independent doctors’ practices at a record rate. In doing so, they often promise to preserve doctors’ salaries and cover the cost of getting EMRS. As the coming financial squeeze forces hospitals to write off computer systems, the result, he insists, will be “kaboom!”

Business: A very big HIT | The Economist


  1. Certainly cause for concern. Health IT was riding high in 2010 because of the stimulus money, but if stimulus is not enough to even make a dent in the costs for hospitals, many are going to avoid utilizing it altogether.

    But I think there is cause for hope. The Health Affairs blog published a post ( today about how the Obama administration has helped thaw the health IT market by wresting certification control away from CCHIT. They argue that it has driven prices lower.

    I'm not sure that there's really a bubble. Bubbles always burst, and I'm not convinced that health IT is heading down that path. But let's hope that the industry can come up with something sustainable and avoid a crash.


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