Speakers at AMM discussed how to enter the healthcare IT marketLeading off the discussion was Patrick Wilson, CEO and founder of Vital Signs Technology, an experienced healthcare IT solution provider and the 2010 chair of the Healthcare IT Community. As he pointed out, perceptions must be overcome on both sides of the table, including the opinion of some doctors that they will never get ANY federal stimulus money. With careful research and preparation, solution providers can build both their messaging and technology solutions to address the business needs of these medical professionals.
According to Wilson, “Doctors understand the need to continually update their clinical tools, so as providers, we must convince them that to protect their client and business data, their infrastructure should be upgraded as well.”
With the current healthcare IT market approaching $24 billion and projected to grow 14 percent annually through 2025, it’s well worth your time to invest time and money to properly prepare for these types of discussions with doctors.
Solution providers also need to understand what physicians don’t want, such as partners’ excuses to why their systems are down or their data isn’t available. In that regard, Wilson reminded the group that “VARs must show clients the value of the HIT systems, but also need to educate them on differences between business and consumer grade products.” Reliability is a top priority in healthcare IT.
Other strategic objectives include selling doctors on the operational and quality of care value of EMR—such as their ability to access patient information when they are away from the office and a medical emergency arises. If a patient is hospitalized and unresponsive, can the emergency room physician get the health history required to prevent drug interaction issues and streamline the diagnosis process (time is literally a life and death concern)?
Wilson points out that this market that not likely to shrink anytime soon, as we all live longer and healthcare is ongoing and becoming more complex. EMR is just one piece of a much larger healthcare system, so savvy solution providers can expect prospects and revenue to climb over the next several years, creating a great investment for most firms.
Goals of HITECH
Pam Markle, senior manager of healthcare for Ingram Micro, reviewed the goals of the HITECH act during the session, a key point to remember when designing and building a healthcare IT practice. The legislation is intended to improve the quality, safety, and efficiency of the healthcare industry, while reducing the health disparities between regions and medical practices.
Markle suggests that healthcare IT should engage patients and their families, allows each doctor to improve the coordination of care and ensure adequate personal health information security and privacy protections are in place.
Effective healthcare IT solutions should create operational efficiencies and reduce costs for doctors’ offices. That’s a long-term goal, not an immediate result. Markle cautions solution providers to set the proper expectations, as the beginning of an EMR implementation actually may decrease productivity until the systems have been up and running for a while. It takes time to get processes down pat, as the offices and VARs tweak procedures until they are best for the practice. If implemented and adjusted to meet the needs of the office, savings and other benefits will occur in short order.
Some of the advantages of EMR for medical offices include:
- Average chart delivery time declines from 18.1 minutes to 20.4 seconds.
- Chart use is reduced by 66 percent.
- Dictation and transcription costs decline.
- Medical record supply costs reduced by 55.7 percent.
- Through the elimination of third-party billing services, the average small practice can save six to seven percent of revenues collected each year.
In addition, patient care also benefits from improved coordination of records between primary care and specialists, with global (in some cases) access to records in emergency situations.
Understand the Financial Side of a Medical Practice
Despite the perception that doctors are rich with a tremendous amount of disposable income, the situation is actually quite the opposite. Many physicians are highly leveraged, especially those in private practices with their own office and staff expenses.
“The typical doctor is not wealthy, with finances similar to most small business owners,” says presenter Chris Adams, VP of sales for GreatAmerica’s Healthcare Group. “With a mean U.S. credit score of 693 and a mean of 710, the average physician’s credit score is virtually the same (710)!”
If you consider that EMR-based independent practices have been shown to save approximately $50,000 per physician, this could be a great selling point for doctors strapped with operational costs and personal debt. Adams points out that the average student loan debt for a physician is $158K, and each spends between $500 K and $1 million in insurance and operational costs each year. With federal budget discussions calling for a 29.5-percent decrease in Medicare reimbursements in 2012, their revenue is likely not going to climb as fast as their expenses. Now, consider the personal and family concerns for each doctor and you’ll understand why selling them an EMR system can be quite distracting!
Adams suggests that solution providers simplify the sale for physicians, following the process mastered by medical equipment (lab and diagnostics) and software providers. Create all inclusive offerings, monthly or per physician charges, aggressive financing rates and other programs to make healthcare IT a straightforward purchase (or recurring service) decision. Show an understanding of the doctor’s economic and business environment, and use “easy” as a baseline for value selling.
