Providers need to develop a transition plan that addresses workflow as well as information technology to optimize the results of integration.
[The following content is sponsored by Iron Mountain.]
With the number of healthcare mergers and acquisitions continuing to grow, it's hard to keep up with the various affiliations and partnerships between providers. With the shift to meaningful use and accountable care, it will be important to increase efficiencies and consolidate processes to maximize cost savings during the merger — and beyond. Providers will need to develop a transition plan that addresses workflow as well as information technology to optimize the results of integration.
There are analogies on a personal level that bring these concepts to life. Whether you are combining households through marriage, or inviting parents or in-laws to move in, you'll need to eliminate redundancies (how many coffee makers do you need?) and consolidate technology (which cable company do you choose?). By consolidating, you'll be able to take advantage of bigger savings — while minimizing the number of bills you need to pay and vendors you need to manage. And, if you're contemplating the purchase of a new house, you want visibility into the total cost to manage the property (does it use oil or gas?), any associated risks (like a leaky roof), and the status of the infrastructure (like an aging furnace) before agreeing to the sale.
For healthcare providers, there are similar steps to take — both before and during the merger. Critical IT applications and systems may be dated, and there could be risks associated with the way this health information is managed. Not only is it necessary to understand the technology and processes in place throughout the health network, but it is also important to develop a strategy for their integration and consolidation as the health systems merge. With the proliferation of different applications and strategies throughout the health network, this effort becomes even more challenging.
In any merger situation, a critical first step is to conduct a thorough, system-wide assessment throughout the health network. The assessment should cover the breadth of health information issues, including the records and health information processes that impact costs, care and the organization's goals. The following recommended strategies have been utilized at health systems across the North America to help guide the assessment and facilitate the merger and acquisition process:
• Review your vendor portfolio, and determine what you're spending — both where and why. Do you have multiple health information management vendors duplicating efforts and costs? Having multiple vendors is not only costly in dollars, but also puts an unnecessary strain on worker productivity.
In the world of healthcare, decentralization has been the tradition. In comparison to corporate entities, healthcare organizations have been departmentally organized. The IT department has traditionally focused on core infrastructure, while clinical departments looked after their own technology, creating silos throughout the health network. With silos come complexity, inefficiency and increased cost. Subsequently, as it relates to information management, each department has their own systems and applications with their own storage administration, expense structure, and maintenance obligations.
There is certainly an opportunity to streamline this approach and reduce cost. By consolidating vendors, you can get a number of benefits. Your initial strategy may be to get consistency across some of the key information management functions, including archiving, retention and destruction, that have proliferated that across the health system. But a more powerful approach is to have consistency across these applications — with a centralized shared services model — so you have a uniform approach to your information management across functions, departments and processes.
With this approach, you can benefit through a consistent, enterprise-wide strategy that reduces the number of vendors, systems and technologies, while leveraging purchasing power and optimizing capacity.
• Fully understand potential risk areas — particularly in the area of information management. In a merger situation, many of the combining entities have different policies and practices. In an industry like healthcare, that can indicate a level of security risk and exposure. As health systems merge, the respective policies for information destruction and legal holds are often inconsistent, making it difficult to find specific documents for discovery. E-discovery costs are not the only major risk; your organization may be more susceptible to litigation, or even the ability to properly defend itself because it can't find records due to inconsistent policy application. It is also important to understand the security-related risks across the entire health system to minimize the risk of breach and avoid potential fines.
By streamlining vendors, you can implement consistent, enterprise-wide policies and procedures, thereby enhancing information security, improving compliance and enabling you to better respond in the event of a discovery request. This strategy will also enhance your ability to deliver patient care because your information is consolidated and protected in a much more consistent and compliant way.
• Evaluate the true, total costs of managing information across the health network and across all the providers involved in the merger. Include not only the costs for information storage, but also associated costs for real estate, personnel, ongoing maintenance and even your opportunity costs to get an accurate picture. Consider outsourcing or out-tasking these information management functions to optimize your resources and enhance your strategic focus.
Most organizations don't have a full understanding of what it costs to support the lifecycle of managing their information from a total cost of ownership perspective. Often time, information storage costs are "hidden" as a shared service line item that loses its granularity in budgeting. Because the true costs are not captured, they can't be measured and forecasted. In addition, many times the true costs are much greater than perceived or projected.
A key benefit of outsourcing is the visibility you have on your resource consumption; with outsourcing you can measure it, manage it and get real cost center visibility, enabling you to properly allocate costs and more accurately budget for the future. Additionally, you can change behavior around resource consumption when respective departments are responsible for funding their share. The most compelling reason to outsource, however, is to support your organization's strategic focus. This approach enables you to preserve your capital for your most strategic initiatives, including healthcare delivery and revenue generation.
• Develop a strategy to handle hybrid records across the health system. Paper is still pervasive throughout most health networks, and in a merger situation, there is a high likelihood that many of the departments and functions will be paper-based. As part of your assessment, you will need to address the full spectrum of information managed, regardless of format or location, and plan for the rapid transition from physical to electronic.
For most providers, particularly those that are well along in their EMR implementation, it is no longer necessary or cost-effective to maintain onsite storage of archival paper records. Through the development and application of retention policies across the health network, you can determine which records are past their retention dates and destroy them in accordance with policy. Frequently accessed records can be scanned, so they are readily available when requested in an electronic format. Archival paper records can also be scanned as they are requested and made available on-demand. In addition, resource-heavy production functions, such as release of information and scanning, can be outsourced to multiply your efficiencies and cost savings.
• Assess your ability to manage the storage of the growing amounts of electronic data - including PACS, RIS, HIS and electronic health records. Does your current solution maximize capacity utilization, allowing you to scale on demand? It is critical that your infrastructure can easily scale as your health system goes through the merger process and the volume of data grows? Traditionally, healthcare providers have "overbought" storage capacity in anticipation of their future needs. Because of the rapid growth of electronic health data, this overbuying can result in a significant amount of idle storage capacity that you are paying for ahead of use.
An outsourced approach to storage and information management enables you to operate with 100 percent capacity utilization for optimal cost effectiveness. With this approach, you can increase storage and support your data growth on-demand, and eliminate the planning, procurement, deployment and migration burden.
Even in the best of circumstances, planning for a merger or acquisition requires careful preparation and detailed analysis. It is an inherently difficult task to balance the information management requirements of providers and physician networks — supporting multiple departments and thousands of patients — with the dueling needs to provide easy access to information and HIPAA-level security. This challenge is magnified even further in a merger situation with each department using its own unique solutions and processes.
A well-planned strategy can unlock substantial savings throughout the process and reduce the burden on staff. Through the reduction of redundancy, providers can realize cost savings through reallocating resources and minimizing operational complexity. Additionally, from a risk perspective, providers can enhance security and compliance, and be better positioned in the event of a discovery request. Most importantly, the net result can improve the delivery of patient care by freeing up dollars and resources for care-centered initiatives.