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E3 at Vanderbilt University Medical Center
David Posch, Nancy M. Lorenzi, and Thomas Campion
When he became chief operating officer of the Vanderbilt Medical Group in 1999, David Posch realized clinical volume staffing ratios were high in comparison to those of other outpatient groups, but appropriate given Vanderbilt’s present work processes.
Facing growth opportunities, the finances of Vanderbilt University Medical Center (VUMC) would deteriorate without proper intervention. A strategic financial plan was developed by the organization to increase patient volume and revenue by 5 percent and to decrease expenses by 2 to 3 percent per year. About the same time, the Vanderbilt University board of trustees approved the “10 by ’10” plan that the School of Medicine had developed. This plan expects the School of Medicine to be ranked in the top ten of U.S. medical schools by 2010. To attain this goal, an improved financial performance would be significant.
Posch thought that a redesigned operational work flow was essential “to get the fat out of the system.” He created a clinic redesign team—an internal multidisciplinary team with people from the clinic operations, the quality office, and the informatics department.
The clinic redesign team planned to analyze each clinic’s operations and recommend process improvements based on Dartmouth-Hitchcock’s Clinical Microsystems. The team started with one of the smaller clinics to test their methodology. The components of the methodology are highlighted in Table 13.1. Although the team’s efforts resulted in improved efficiency, costs were not substantially reduced as the macro processes remained fundamentally the same; however, altering the micro processes would mean tremendous savings.
Enter the Partnership with Informatics
Seeking process improvement, Posch approached the director of the informatics center, Dr. William Stead, about clinic redesign and automation. Posch asked Stead, “Can we incorporate information technology in different ways to remove costs, remove labor, or change the ratio of labor to work?” Removing paper processes by using an elec- tronic medical record in outpatient areas would greatly cut costs, Stead said. With paper processes eliminated, the institution would have a blank slate on which to rework its procedures for maximum efficiency. Stead assured Posch that the informatics center would work with him to develop or purchase the appropriate information systems, and the E3 project—being electronic by 2003—began.
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The macro goal became to transform the Vanderbilt healthcare systems into a model for the future, including improved clinic redesign as well as creating the enabling tech- nology tools to “transform our organization through people and systems” (TOPS).
The TOPS initiative had five interlocking components that together constituted the transformation goals:
1. Delivering the right care and only the right care (clinical guidelines, evidence-based medicine, and a reduction in variation)
2. Being able to deliver the right information when and where it is needed (the infor- mation systems and the informatics leadership in conjunction with the clinical and clinic operation leaders)
3. Quality patient interaction (listening to patients, meeting their needs, involving patients)
4. Supporting patient transactions (including parking, timely check-in, seeing the physician promptly, no waits, no delays, etc.)
5. Having a culture where employees understand and model the science of improve- ment in their daily work.
Trusting financial improvements to process redesign through information technology was a gutsy move for Posch. By betting success on a nonexistent technology product to be developed quickly and implemented efficiently—without ever disrupting work flow—Posch put his neck on the line.
VUMC Background
VUMC is a university-based comprehensive healthcare organization comprised of pro- fessional schools and wholly owned clinical facilities, including hospitals and group practices, as well as off-campus clinics. Its medical group practice participates in numer- ous joint ventures and affiliations. The medical center board, which reports to the Van- derbilt University board of trustees, oversees the institution’s $1.2 billion budget.
The Vanderbilt clinical enterprise has two primary components—hospitals and out- patient clinics. The hospital component is comprised of four divisions: the university hospital with 650 beds; the children’s hospital with 170 beds; the rehabilitation hospi- tal with 80 beds; and the psychiatric hospital with 88 beds. The outpatient clinics com- ponent includes more than 95 specialty practices that see more than 688,000 patients TABLE13.1. Assessment of and change in the current systems.
Who Goal(s) What
Clinic assessment 1. Focus on a review of each clinic’s operations. Access assessment 2. Develop recommendations for efficiency, satisfaction, Clinical operations
capacity, etc. Comprehensive work flow
3. Establish an implementation team and guide the start General operations
of the redesign effort. Readiness assessment
4. Develop a system to continuously monitor each clinic’s Redesign consulting attainment of its established goals. Space assessment
Satisfaction Billing assessment 1. To better understand the financial process and to Billing processes
collect the money billed in the shortest time. Charge capture process
per year. Ranked highly nationwide are the programs for cancer; cardiology and heart surgery; digestive tract; ear, nose, and throat; hormonal disorders; gynecology; ortho- pedics; respiratory care; rheumatology; and urology. VUMC is a major patient referral center for the geographical region.
Clinical Visioning
Posch presented his informatics-laden strategy to the chief medical officer in May 2000.
Based on recommendations from the chief medical officer and the director of the infor- matics center, the chief executive officer (CEO) for the medical center formed an exec- utive steering committee to lead the E3 process. The group was comprised of leaders who could create change, mobilize resources, maintain accountability, keep the project on track, and serve as champions for the cause. Coordinating the process was Dr. Nancy Lorenzi from the informatics center, who was in charge of organizational development, specializing in change management. With the committee assembled, the “anchor” for this outpatient enterprise transformation was in place.
After the executive steering committee, a clinical visioning group was formed in July 2000. This group consisted of twelve respected clinical people from multiple disciplines who were to formulate an image of information communication needs for desired patient care in 2004. From an initial nine-page wish list, the clinical group narrowed its scope, outlined priorities, and established key goals. Table 13.2 is an overview of the
“wish list” developed through this process.
The wish list was given to the informatics center for a feasibility assessment. At the same time a second group, the informatics brain trust, a committee comprised of half informatics center staff and half tech-savvy clinicians, was formed. The informatics brain trust developed an integrated picture of existing informatics tools and efforts, current opportunities, and future options. Supporting the clinical visioning group’s first priority for a user-friendly front end to integrate the multitude of available products, the group began with this focus. They outlined a clinician-friendly front-end design and commissioned the informatics center to design a screen layout and prototype of their plan. Immediately pleased with the results, seven informatics brain trust members began using the test product.
The number of users grew quickly and spread. At this point the product was named StarPanel. The name StarPanel was chosen for the user-friendly portion of the evolv- ing electronic medical record system called StarChart. StarPanel’s fame was spread through stories of its use. Those using the system said that it increased the just-in-time information they needed for patient care and that it was making their lives easier. The excitement about StarPanel was palpable throughout the organization.
Projects: Competition, Distraction, and Convergence
StarPanel was not the only product under consideration for E3. Two years prior, devel- opment had begun on a computerized physician order and compliance system, as well as a structured documentation system intended for use in the outpatient clinics. With institutional financing, the two systems were being developed for integration with the existing electronic charting system (StarChart) to form E3’s core products. Task com- plexity and production difficulties for these two projects delayed their timeline, but
TABLE13.2. Overview of the clinical visioning group’s goals.
Organizing
principles E3 visions
Patient flow 1. Schedule all appointments/tests—outpatient and inpatient—through a single system; the management patient’s schedule is linked to all service providers (e.g., radiology) for easy electronic
scheduling.
2. Make it easy for patients to obtain follow-up appointments. Patients can schedule their next appointment using a touch screen.
3. After a visit, provide patients with a voice mail code to obtain information regarding medications, things to do, results, etc.; or allow patients to query the office via the Internet regarding medication refills, return appointments, etc.
4. Contact patients prior to their visit with instructions to bring in medicines, records, blood pressure readings, etc.
5. Make a number of forms available, e.g., a telephone call log form database.
6. Provide better physical access to terminals, especially for handheld wireless devices.
Integrated 7. Give patients access to an abbreviated personal medical record electronically.
story about 8. Allow a number of items to be scanned and available, e.g., ABN, permission to treat, etc.
patient 9. Have all incoming faxes converted to digital format immediately.
Inside Vanderbilt University Medical Center (VUMC), develop systems to e-mail or send results, reports, etc., to a physician’s personal computer or printer. (Go from WIZ to VNET electronically.)
10. Need an electronic medical record that fits an office-based practice with a clinical decision support system.
11. Have only one history/physical, one problem list, and one current medications list.
12. Electronic progress notes that are updated with each provider contact (store).
13. User-friendly front ends to integrate systems/information (e.g., buttons/tabs that represent the history, physical, problem list, progress notes, current medications, allergies, etc.).
Actions 14. Provide automatic alerts for doctor-to-doctor contacts. Provide the ability to click on a referring physician’s name to automatically e-mail and send to the medical record.
15. An outpatient order entry system that will eliminate dose errors, medical errors, chemo, etc. Ability to order lab results beyond the clinic, allowing the patient to go directly to the test location. Diagnostic tests (lab, radiology, etc.) are coordinated with visits;
requisitions and prescriptions are electronically sent to their destination.
16. Provide a reminder system—e.g., to fill orders, trigger screenings, etc.
Capturing 17. Computer-assisted ICD-9 coding.
information 18. Need to have voice recognition readily available to assist the clinicians.
19. Electronic progress notes that are updated with each provider contact. (capture) Internal 20. Make all patient insurance information available online for authorizations/
business precertifications, etc.
knowledge 21. Complete referrals/prior approvals electronically; the system knows what insurance will pay. (This is a way to end claim denials.)
22. Provide a database of referring physicians and a computerized mechanism for making a referral to another physician within VUMC.
23. A Web-based forms page where all VUMC forms can be found.
24. Database with free text flexibility to manage population (real time, inside/outside facility, request/track referrals, etc.)
External 25. A database of referring physicians.
knowledge
Using 26. Provide the ability to easily search patient records by diagnosis, physician, etc.
information technology long term
institutional support kept their development going forward. This full-featured approach to E3 would satisfy order entry, compliance, billing, and documentation needs, but the difficulty of developing programs in these complex efforts made com- pletion by 2003 seem out of reach. On the other hand, StarPanel development was an unexpected early success. StarPanel is the comprehensive user-friendly electronic medical record for VUMC. It allows users to create a panel of patients, which enables a provider to track his or her patients in an efficient manner. StarPanel integrates patient data from multiple sources, including laboratory and pathology results, radiol- ogy reports and a link to a picture archiving and communications system (PACS), echocardiography reports, discharge summaries, physician notes, lists of problems, medications, and allergies, and physician orders, as well as other documents. StarPanel also contains a powerful messaging system to facilitate communication regarding patient care.
Documents from outside VUMC can be incorporated into the medical record uti- lizing StarScan. This feature allows providers to have a patient’s complete medical record at their fingertips and available from any location.
A faculty member proposed the creation of StarNotes, a version of the clinical note- taking tool extracted from the hospitalwide clinical provider order entry (CPOE) system. Using StarNotes, physicians create templates to enter patient visit data and notes, replacing dictation. StarNotes was another component in developing an all-in- one system and integrated nicely into StarPanel.
Early Results
One of the informatics brain trust’s early adopters, Jim Jirjis, M.D., enthusiastically embraced StarPanel. He shared the early product with other primary care physicians.
Together they decided to adopt StarPanel for the entire adult primary care center (APCC). The target site for initial implementation and development of the StarPanel project was the Vanderbilt APCC. The center is housed in a campus-based building. It is comprised of twenty-four attending physicians and seventy-one residents and is divided into four physical suites of offices and examination rooms. There are three group practices: internal medicine primary care, medicine and pediatrics, and geriatrics.
Practitioners vary in type, including physician-scientists, physician-educators, and full- time medical center clinicians and medicine residents and nurse practitioners. All attending physicians are part of a larger multispecialty medical center–owned physi- cian practice group, the Vanderbilt Medical Group. Primary care at this site services 35,000 patients and has 48,000 office visits per year. The APCC needed to invest in
$31,102 worth of new hardware for a solid technological infrastructure. See Table 13.3
TABLE13.3. Adult primary care center (APCC) overview.
Item of analysis November 2001 Annual
Visits (actual) 4,103
Visits (projected) 49,236.00
Total cost (baseline) $294,513 $4,597,165.32
Total cost (tech-enhanced) $144,917 $1,739,015.52
Net savings $149,596 $2,858,150.00
Investment (APCC suite IV deployment) $31,102 $150,000.00
Return on investment $4.81 $19.05
for an overview. The APCC’s management structure consisted of a medical director, a nurse manager, two assistant nurse managers, two administrative assistants, and a cleri- cal staff member. The APCC employed seventy-eight staff members, including patient care technicians, nurses, and clerical staff. The practice information system consisted of a mainly paper-based, traditional charting system that was not standardized through- out the four suites. Charts were kept in file rooms within each suite, and management of the charts was the responsibility of the suite’s file clerk and the other clinical staff members. Some medical information was also available in an electronic medical archive record system, which included laboratory data and various notes and reports. Most documentation and the associated work flow of patient visits, telephone calls, corre- spondence, laboratory, and imaging was contained in a paper chart. StarPanel was implemented in this milieu both as a test for the clinic and for codevelopment and enhancement of the product.
But Dr. Jirjis did more than a standard test implementation; he altered StarPanel’s foundations by guiding creation of a message basket function—an electronic tool allowing clinicians to communicate regarding patient care and easily send information to StarChart. Thus, StarPanel could be tailored around the uniqueness of the clinical work flow of each specialty clinic. This innovation made adoption of StarPanel much easier for other clinicians.
With StarPanel usage increasing and paper costs decreasing, an economics Ph.D. con- ducted a return on investment (ROI) study of StarPanel. For November 2001, in which there were 4,103 patient visits, the results were compelling: 32 percent less time and 51 percent less cost per patient visit using StarPanel meant a reduction in cost from
$294,513 to $144,917—$149,596 savings that month alone—and projected annual savings of $1.8 million for the APCC.
The study said that StarPanel cut costs of physicians, office assistants, patient care technicians, and patient service coordinators (Tables 13.3 and 13.4). Per visit the cost for physicians was cut in half to $25.82, for technicians to $1.62, and for patient service coordinators to $1.33. More time was required to enter data into StarPanel; thus the per-visit nursing costs increased from $6.13 by a nominal $0.42 to $6.55. The cost of office assistants as well as medical information assistants (those who previously pulled and transported charts) was completely removed. These employees were placed in a redeployment program and reassigned to other parts of the organization that had suf- fered losses through attrition.
The expanded pilot in the APCC had required a projected initial investment of
$150,000 for technology for the entire clinic. It seemed that StarPanel appeared ready for enterprisewide implementation to help the institution achieve its financial goals.
TABLE13.4. Adult primary care center personnel costs.
Personnel costs Visits Rate ($) Process cost ($) Direct
Physician 4,103 25.82 105,939.46
Office assistant II 4,103
Patient care technician 4,103 1.62 6,646.86
Patient service coordinator 4,103 1.33 5,456.99
Registered nurse 4,103 6.55 26,874.65
Indirect
Medical information assistant I 4,103
Personnel subtotal 4,103 35.32 144,917.96
Posch’s Dilemma
StarPanel’s success was inspiring. However, there were some issues to resolve before a housewide rollout was launched. Personality was one such issue. Dr. Jirjis was a super- champion of technology-based medical change. He had jokingly said he would like to
“have his tablet PC surgically implanted into his arm.” Dr. Jirjis made improving health care through informatics his top priority. Although other physicians in the organiza- tion were tech-savvy, future StarPanel implementations could not rely on the dynamic presence of a Jim Jirjis type at every site.
In addition to the intangible element of enthusiasm, economics also came into play.
Was the ROI analysis valid?
Several factors make it questionable:
• First, the staff time and cost numbers were best estimates, not meticulously gathered measurements. A review team was put together to audit the report and determine if, in their experience, the numbers were realistic.
• Second, the analysis did not take into account cost implications related to medical records, internal audits, finance, contracting, risk management, or legal affairs.
• Third, was the generalization of the clinic’s figures for one month (November) across the entire calendar year indicative of its true annual performance? (Could this clinic alone save $1.8 million? This seemed highly unlikely at first glance.)
Did the ROI analysis inflate cost savings by failing to recognize that the termination of medical information assistants was a one-time event? While the medical informa- tion assistant could be replaced by automation, other employee time and monetary savings would be achieved on a percentage basis across the entire worker pool. No other specific employee groups could be targeted for termination because their roles were not 100 percent replaceable by technology.
Understanding the reality of StarPanel’s impact, Posch knew that the product could save money, but he was forced to reevaluate how to calculate its savings. Based on the pilot results, Posch reasoned that one full-time employee (FTE) could be redeployed for every 10,000 patients. Although this seemed a good approach for the medicine spe- cialties, would it hold when the product was rolled out in the surgical specialty areas?
Would Posch risk his future on a pilot performed on 7 percent of the total patient population in the hope of extending it to all clinics serving 688,000 patients? What should he do?
Questions
1. What would you do?
2. What questions would you ask?
3. What would be the critical success factors?
4. If you decided yes, what would you be committing the organization to do and what would be its true value?
5. How would you design a rollout process to ensure successful adoption of the tools and capture the savings?
