Healthcare has the opportunity to not only improve connections between systems, but also find cost savings and productivity gains.
Interoperability has long been a buzzword in the healthcare industry; it’s a catchall term used to explain a variety of technology woes plaguing hospitals, health systems and health plans alike. However, the concept of interoperability is really quite simple: information is easily exchanged between systems and then quickly made available for the people in need of that data.
There has been a growing need for interoperability in the industry over the last decade, as more organizations work together through new partnerships or mergers. Specifically, the introduction of accountable care organizations (ACOs) has been a great driver for interoperability. There is a breakdown when these healthcare organizations leverage disparate systems that are not compatible or rely on paper-based processes. It is important to note that disparate systems and paper-based processes are not a new phenomenon or an issue limited to different organizations working together. It often is a struggle within a single organization and is compounded the larger the organization becomes.
Interoperability, then, is supposed to be the magic fix that allows all of these systems to work together in harmony. Interoperability in healthcare has been anything but a magic fix. The federal government’s Health IT Policy Committee released a report in December 2015 describing the “challenges and barriers” of interoperability. As the chief technology officer of a healthcare technology company, I have a unique vantage point as to how organizations are struggling with the lack of interoperability. From my experience, the root problem is that for too long organizations have only been focusing on the clinical side of healthcare. It is time to go beyond the clinical side of healthcare and focus now on the administrative side to achieve interoperability.
The true costs of administrative inefficiency are hard to realize at a micro-level. For example, staff may switch between one or more screens to complete a single payment transaction. A few extra clicks for one transaction might not seem like a time-consuming process when evaluating one employee’s workflow. But when you look at it from a macro-level, the true cost becomes apparent. Consider that 16% of total healthcare spending is on administrative costs (McKinsey). The costs are not just monetary either, as 21% of physician’s time is spent on non-clinical paperwork (2016 Biennal Physicians Survey).
When healthcare organizations focus on streamlining administrative processes and workflows, the industry not only has the opportunity to expedite gains in interoperability, but it also can find significant cost savings and productivity gains. In particular, leveraging electronic transactions and integrating heterogeneous systems in the healthcare payments process represents enormous potential towards achieving interoperating and realizing its benefits. In fact, the 2016 CAQH Index Report estimates that the potential savings is $9.4 billion if healthcare adopts electronic transactions.
In this article, I have outlined a new approach to interoperability by looking to the administrative side of healthcare. Next month’s article will take a closer look at the strategies to effectively implement this change at your organization and ultimately achieve interoperability.