Sean Hogan has a front-row seat for one of the great inflection points in the history of healthcare. The VP of Global Healthcare Delivery Systems for computing colossus IBM leads the development of the company’s healthcare industry solutions. Not a bad spot to be in, considering how much investment is being poured into healthcare information systems from players as diverse as Google and the U.S. government. IBM itself is looking to profit from the integration of information technology into day-to-day healthcare delivery.
MassDevice caught up with Hogan at the 2009 CIMIT Innovation Congress in Boston to ask how IT will change healthcare delivery.
MassDevice: How can data change the way we administer care and how critical is it to get this right?
Sean Hogan: There’s a tremendous opportunity to substantially change multiple aspects of healthcare delivery through better use of information technology, [to change] how we can diagnose care and our ability to anticipate and predict problems that an individual may have. There’s also the opportunity to constantly learn as care is applied and how it translates into outcomes.
If you can capture that information, aggregate it — and that’s always the problem, getting scale, especially when you have a specific condition like we heard today about epilepsy — if you take something that’s very vague like epilepsy and treat it very generally, where it’s actually a much more complicated thing. So only by getting the derivation of insights do you actually drive learning, and that’s where we have a tremendous opportunity in driving fundamental changes.
MassDevice: Is there any danger in becoming too reliant on data, of falling in love with the data and forgetting some of the things we’ve learned about providing care on a human level?
SH: We’re definitely in a period of transition, and one of the debates that plays out in healthcare is the notion of evidence-based medicine, or a standard of care and applying that care.
What you don’t want to do is standardize the way that you’re approaching people as an average person, as opposed to a specific person. I think that’s a natural tension that we’re going to wrestle with as we start to learn how best to apply information into the process of care.
But ultimately, as we can get to the application of care that’s highly personalized, but draws upon the wealth of knowledge we have from experience with multiple individuals, multiple conditions, that’s where it becomes very powerful.
MassDevice: What’s hindering every doctor in the U.S. from having electronic healthcare record keeping systems?
SH: In terms of where we are in the journey, I think we’re at an inflection. Part of the reason I think we’re at an inflection is that we’re having decreasing cost in the technology that’s available, and increasing funding that’s available to support it.
Part of the reason adoption has been a bit low is that there hasn’t been a good value proposition about what doctors can get through electronic medical records. It hasn’t been really compelling. It just adds a step, maybe it can help them be more productive in their filing, but it’s not necessarily empowering better care.
We’ve been thinking a lot about this. When you think about the kinds of technology we want to see to help serve the physician, the question we’re asking ourselves is, ‘Does it make the physician’s practice perform better?’
Because [adoption is hindered] if they’re not going to drive a better economic improvement, with the ability to see more patients or earn more money — or have a better quality of life, too, because that’s part of the equation — and then deliver better care and outcomes. So if we can deliver the combination of those two things at a price point that realizes a return, it gets interesting.
As I said earlier, declining costs of technology and new models of serving the technology, where it’s not a capital investment up front but more like a service base or subscription to the technology, changes the model as well.
MassDevice: Do you think the stimulus package and its emphasis on rewarding physicians who convert to EMRs is doing enough to drive implementation? Has IBM seen any increase from this?
SH: First, the stimulus money really flows starting in 2011, so mostly what’s been occurring so far is defining how that stimulus money will be applied and distributed; what qualifies to be reimbursed. I’m very encouraged that they’re focused on standards and they’re focused on use of technology that translates into value, usually measured in the quality of care that’s provided. So I’m encouraged by the direction they’re taking, but that money hasn’t started to flow yet.
Organizations need to start doing things next year, because by the end of 2010 they need to demonstrate that they’re doing things that will allow them to receive reimbursement in 2011.
MassDevice: In the future, how much do you see the healthcare segment driving the bottom line for IBM?
SH: Right now it’s a big part of our business, well over $5 billion today. We don’t report on that dimension, so it’s not something we break out and I can’t get into all of that. But when you think of healthcare as being one-sixth of our economy, it represents an interesting area of upside. Right now healthcare represents maybe a 20th of our total revenue.
MassDevice: Are you doing anything differently to take advantage of this new paradigm in healthcare?
SH: Of course, we’re doing many things differently in thinking about putting different components together and how you can do things differently. So you can aggregate the data in a database, you can do analytics against it and then you can engage and serve up that information through portals or communications tools. Then you can drive changes in process of care.
We’re also working on the financial mechanisms, so we’re using IBM Global Finance to help people purchase things today, knowing they can ultimately get reimbursed for them later. We’re also looking at cloud-based service models where you can acquire the technology on a subscription basis, as opposed to having to invest up front as a capital expense.