Standardization of Healthcare Information Technologies: Increasing Efficiency and Patient Safety While Reducing Economic Cost

Abstract

The concept and variables pertaining to standardized healthcare information technology (HIT) are researched and discussed. Information pertaining to the benefits to HIT standardization as well as current issues within the healthcare industry which can be improved upon by said standardization will be examined. The extrapolation pertaining to HIT standardization bringing more efficiency, as well as greater patient safety and overall economic benefit will be explored and concluded upon.

Introduction

The healthcare system in the United States is an industry notorious for innovation and change. As technology and information grow and become more advanced, so does the healthcare industry in an attempt to find sophisticated methods for healing others while curing disease. As of late, rapid transformations are becoming necessary as the nation implements the Affordable Care Act, and continues to grow in population, need, and a wealth of information technology. These include new regulations that dictate minimum levels of care and the maximum allowable payments for individuals and families. This is a major shift; posing implications for insurance companies and medical professionals, as they are required to execute this care better, faster and cheaper than has been historically mandated. Other alterations necessary include the implementation of health information technology systems within the industry as a whole. While many systems are diverse, and there is no standardized method within one hospital (let alone the entire industry), operational deficiencies may be frequent due to a lack of portfolio, vendor and knowledge management functions. In moving toward a more standardized approach to HIT, an increase in efficiency throughout the industry may be reached which will aid in cutting economic costs while providing more safety to patients.

Research Literature

There has been much controversy over the changes facing the health care industry as of late, as well as several benefits. Ever since the Patient Protection and Affordable Care Act (PPACA) was enacted on March 23, 2010, and upheld by the Supreme Court on June 28, 2012, we have been seeing more radical changes historically than before (Rak & Coffin, 2013). Changes such as the prohibition of insurance companies to rescind benefits or discriminate against those with preexisting conditions are now in place. Other changes include the elimination of lifetime limits on policies, and an extension of dependent insurance to reach offspring up to the age of 26. Medicare has also been made more accessible to anyone with an income up to 133% of the federal poverty line, according to Rak and Coffin. While these changes have been a benefit to patients, there are other changes in the industry that are becoming a burden.

Burdensome changes happening within the industry in an unorganized way pertain to the implementation of health information technology (HIT) systems on a broad scale. Even though the United States healthcare system is the largest in the world with a $2.2 trillion gross domestic product (GDP) encompassing 17.3% of the total in 2009, and expected to reach 19.3% of the GDP ($4.5 trillion) by 2019, it is considered to be behind in terms of information technology when compared with other developed nations (Zhang, Seblega, Wan, Unruh, Arigo & Miao, 2013). When compared with other countries, our system can appear to be unsafe, expensive, and inefficient. One example is the fact that 44,000 - 98,000 patients die annually due to medical errors. Furthermore, adverse drug effects are estimated to kill or injure 770,000 patients each year (Classen, Pestotnik, Evans, Lloyd & Burke, 1997). These are some issues that could potentially be eliminated through the implementation of a standardized HIT system throughout the industry.

Standardized HIT systems have not been studied frequently in the past, and only a minute number have occurred in recent years. One study published in the International Journal of Medical Informatics studied healthcare technology as it relates to levels of difficulty and patient safety. Olson, Belohlav, and Cook (2012) concluded in their “Rasch Model Analysis of Technology Usage in Minnesota Hospitals” that technological capability was present as an underlying process within hospitals, and the level to which one is capable of implementing HIT will directly correlate with its success in implementing more difficult technologies. Since there is no standard amongst the healthcare industry, there is great variance between the levels to which a hospital can advance with more sophisticated HIT.

In addition to the variance between technologies, there were findings relating to higher degrees of HIT implementation to patient safety. A strong positive correlation showed that greater levels of HIT implementation in hospitals statistically pointed toward higher levels of patient safety (Olson, et al., 2012). These findings were also reported in a longitudinal study on the payoff of IT in the healthcare industry by Devaraj and Kohli (2000). It appears as though the more IT implementation a hospital has, the less likely the aforementioned accidents are to occur, thus increasing overall patient safety.

Not only is there variance pertaining to HIT from one hospital to the next, but also from the East to the West. Zhang, et al. (2013) concluded in their study of HIT adoption in U.S. acute care hospitals that Northeast, South, and Midwest facilities had higher IT adoption rates than hospitals in the West. The study also found that HIT was more prevalent in urban areas than rural. Furthermore, the implementation of HIT was broken down into three categories: Clinical, Administrative and Strategic. It was noted in the results that larger hospitals were more likely to adopt all three IT categories, while privately owned, for-profit hospitals were most likely to implement Clinical and Strategic IT.

Just as the implementation of HIT is broken into three categories, so is the lens through which healthcare reform and the American healthcare system is examined in terms of improving its performance. There is the political perspective that has been studied by Baucus (2009), the health policy perspective studied by the Institute of Medicine (2001), and the managerial perspective studied by Wood, Bhuian and Kiecker (2000). Of all perspectives, the measure of performance and patient safety has been of particular interest. This has led to subsequent research detailing the safety and quality of care within hospitals and other healthcare modalities (Alexander & Hearld, 2009). As a remedy for the identified deficiencies within the healthcare system, studies have shown that utilizing technology in healthcare is related to a number of positive results (Goldstein, Ward, Leong & Butler, 2002). These include better operational and financial performance, a reduction in errors, and improved decision making (Bates, 2002). HIT is viewed as a vital constituent in the safety and performance of health care institutions (Bates, 2003). There is a general consensus amongst the healthcare community that the solution to battling the ever-changing industry landscape is to implement HIT. What then, could be the issue in more implantation of said IT?

The main issue confronting many organizations in the implementation of HIT pertains to financial restrictions. There are considerable financial costs involved in the implementation of HIT throughout the health care industry (Poon et al., 2006). With the increase of non-standardized, innovative technology comes and increased intricacy in IT development and support to converge these differing technologies (Sutphen, 2010). An interesting point to note is that although there may be some upfront cost involved in standardizing the HIT, studies have shown its implementation saves companies money in the long run through less IT support and application costs. This affects not only the individual businesses but the industry and economy as a whole.

At its current state, the healthcare industry is comprised of several different IT systems working simultaneously with different programs and systems. There is no single system for several functions and duties within a hospital, rather there are several different systems working independently to serve the whole. There are phones, pagers, other handheld and nonintegrated mobile devices; even work stations on wheels (Gwiazdowsi & Hall, 2012). The purpose of these devices is to ensure patient safety and improve the delivery of care, however, each device has a different sound, alarm, or light in which medical staff is to respond. This can be incredibly overwhelming in the hospital environment.

In an attempt to remedy the chaos of multiple machines working independently, the push within the healthcare system is shifting toward standardization. Currently, in a typical hospital, nursing and engineering services operate in silos (Gwiazdowski, et al., 2012). There are separate devices which control the equipment alarms in a patient’s room, as well as the bed alarm. These then go to the nurse call station in the patient room, which then alerts a dome light over the room door. This is then sent to the main nurse call center which is also receiving and sharing information with individual nurse pagers, other nurse call centers, interactive keypads outside patient rooms and location systems. These systems are then connected with other systems such as report management, staff equipment and tags, base antenna stations, phone systems, other wireless phone communication systems for nurse calls, patient monitoring systems (which are also separate) pertaining to emergency, cardiac monitoring and additional monitoring which is wireless. It sounds overwhelming just describing the different systems.

It isn’t only the healthcare system with its vast technological systems which vary by brand, and from one hospital to the next, but also businesses on a holistic economic scale that are shifting toward standardization. As IT budgets restrict expenditures, and are seen as an industry that is solely paid into rather than creating revenue, the push toward standardization has been becoming more mainstream as a creative solution in reducing budget costs (Sutphen, 2010). Beuth Verlag (2000) reports research findings on standardization across a global scale, as it pertains to the economy as a whole. In this research, it was found that industry-wide standards not only had a positive impact on the entire economy but also for individual businesses that used them as instruments in strategic marketing. The use of standardized HIT systems could actually boost the profits for smaller hospitals that might not be as quick to implement them into practice as larger institutions would.

Standardized HIT systems work for businesses beyond simply boosting revenues for smaller companies. Verlag’s (2000) study found that businesses actively engaged in standards that are uniform across the industry tend to work at a higher frequency and reap benefits pertaining to competitive status against those who do not implement standards on a short and long-term scale. Other benefits of standardization noted include early access to urgent information and are able to exhibit greater success in asserting standards through the standardization process. Furthermore, when the legislature makes a technical rule, it is standardization which is the remedy. If a company is already active in utilizing standards and standardization before it becomes law, it could help avoid extra costs that would be accrued through implementing standards at a later time. It has also been shown that standardization leads to lower transaction costs which benefit the economy as a whole, as well as businesses individually.

Additional benefits that are accrued through the use of standardization include a more powerful position for companies over suppliers. Verlag (2000) found that standardization had a positive correlation with buying power over clients as the company was able to have access to a greater number of suppliers which helps businesses refrain from depending solely on one supplier. This increases competition amongst suppliers which results in lower costs for consumers. With the implementation of standards, it allows for almost a coded system of rules which can generalize between individual businesses within an industry. While it can increase competition, it is an aid in developing strategic alliances as cooperation was a positive result of standardization found in the study.

More results from the study conducted by Verlag in 2000 concluded that industry-wide standardization presented less hindrance to innovative projects than other factors such as administrative and political factors. Furthermore, standards were shown to contribute to lower accident rates. It is a positive decision for any business, but especially the healthcare industry to implement standardization into their daily practices as it has been found to reduce the liability of businesses. It is also most favorable for standards to be implemented in businesses with a product life of over five years, as this is approximately how long it takes for a company to fully integrate standardization.

Research Data

Chart #1 shows information containing the national health care expenditures in 2009. Of these expenditures, the highest percentage of costs was spent on hospital care and physician/clinical services (Waissi, 2010).

(Chart 1 omitted for preview. Available via download)

The percentage of GDP used on healthcare shows the US spends more on healthcare than other developed nations who have standardized systems in place. Chart #2 shows the expenditures per capita on health care for various nations from 2002 – 2006.

(Chart 2 omitted for preview. Available via download)

The United States is far higher in expenditures each year than any other country. In fact, the World Health Report (WHO) shows that the United States is ranked number one in the world when it comes to health expenditures per capita, yet it is only ranked 72 when it comes to the level of performance on health. Furthermore, the performance in the overall health system is ranked 37. These are some interesting facts that cause one to ponder the true motivations within the US healthcare industry.

Discussion

Given the research literature supporting standardization as it pertains to HIT systems and the economy as a whole, one can see the value and worth in implementing a standardized system within the U.S. healthcare industry. Statistically, it seems unusual that a geographic region such as the West would be further behind in IT implementation considering the number of large cities, urban areas, and hospitals that are prevalent in the West. Especially when studies show a more implemented HIT system is positively correlated with patient safety. Furthermore, one finds it alarming that the US is only ranked 72 in overall performance on health, yet we spend the most money on it. Considering that businesses have an agenda, and there is so much money being spent on an industry that doesn’t seem to be delivering the results it is intended to, one must wonder if the main goal of the US health industry is not in fact to heal the population, rather, perpetuate a multi-trillion dollar industry that is just now receiving attention pertaining to affordable costs and utilization of standardized HIT systems.

Recommendations and Application

The implementation of HIT systems could encompass a variety of methods and solutions to the key problems facing the health care industry. Suppose that all hospitals have some sort of radiology and oncology imaging software. This software varies from institution to institution and doesn’t share information within one united system. Standardizing HIT would streamline this software so that it is more cost-effective, there would be fewer IT costs and each patient could have the benefit of consistent results and testing across each and every health institution. Furthermore, with knowledge management this information could be shared within one united medical information system which accounts for administrative and health information in ensuring all patient information is current, up to date and available to all health practitioners. This could eliminate many medical mistakes or drug interaction issues.

Another way in which standardization could help the health care industry is through streamlining the medical equipment and devices used by staff. Through implementing a standardized nurse call system, there would be less chaos in terms of the aforementioned components interacting independently as silos, but all working toward the same goal. If this could be simplified into one device there could be easier, faster communication between practitioners and patients, and perhaps fewer casualties (Gwiazdowsi, et al., 2012). Other tactics involve utilizing one standardized mobile device which acts as a phone and communication device between practitioners to communicate with each other and with patients. Another innovation could be a real-time locating system. There are several different types being used which use a variety of technologies. A simple system could integrate ultrasound technology in location as this eliminates extra electronic frequencies within the hospital. There could also be a standardized method for patient monitoring which currently utilizes several separate silos working independently for the same cause. A standardized system would allow for less confusion and chaos when monitoring patients, and reduce alarm fatigue from the various different alarms which alert health care practitioners. It would even benefit to standardize the measuring of certain performance outcomes of staff to increase efficiencies such as response times to patient requests such as bedpan requests, patient medications, routine requests and overall nurse requests.

Conclusion

Although the United States is number one in health care expenditures, its ranking suffers when comparing the effect on overall health and the overall healthcare system. Could it be that this disconnect is attributed to the fact that the health care system has yet to implement a standardized system that translates across all hospitals and health care institutions in America? With the data showing just how ineffective the US is when it comes to delivering healthcare, and the number of accidental deaths that occur per year, it is a wonder that these standards have yet to be put into place. For a country that has been revered as wealthy and a leader in developed nations, one has to wonder why this nation is so far behind when it comes to health care. Is the true goal and agenda truly in optimizing health and cost benefits for the masses, or padding the pocketbooks of the elite who profit from the industry? Only time will tell which way the industry shifts, be it toward the safety of the patient or toward higher rates of spending. Now that there is more research being done pertaining to this topic it should be easier to argue for a more streamlined method of implementing healthcare IT. Perhaps these findings can serve as a caveat in motivating change toward more standardized HIT implementation now for a brighter future.

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