blog.fixkp.org

People ask me sometimes why I still care about Kaiser Permanente. It’s tough to put the reasons into words, except to say that I believe in what Kaiser Permanente stands for. Do you know what it’s like to believe in a country, and just not its current administration? It’s that way with me and George. Halvorson, that is. Mr. Halvorson is destroying the organization’s principles, credibility, and integrity. While that’s painful to watch, I know his time there is temporary, and I know the people of Kaiser Permanente can repair the terrible damage he’s done once he’s gone.

That being said, I spent a few minutes redoing the voiceover for the original Broccoli ad, and I’m calling it Broccoli People. I’m no Allison Janney, but I think one important change needed to be made to the ad. The original ad ends with “We are Kaiser Permanente, and we stand for health.” I’m adding one word: people. So, the new version, Broccoli People goes: “We are the People of Kaiser Permanente and we stand for health.”

It’s pretty obvious that George Halvorson believes in profit, not in health, and certainly not in Kaiser Permanente. But, the people of Kaiser Permanente, our doctors, our nurses, they do stand for health, and they do believe in the principles Kaiser Permanente was founded upon.

The San Francisco Business Times today called me a “persistent critic” who has become “no more enamored of the healthcare giant or its CEO.” I think, the distinction of the organization and its current administration is an important one, and a distinction the paper didn’t make. While I recognize and try to bring some light to the ongoing series of lapses in patient safety and care at Kaiser Permanente, I recognize those lapses are the result of George Halvorson’s mismanagement of the organization. Cutting costs, at all costs, is a dangerous proposition for a healthcare organization, especially one as integrated as Kaiser Permanente. (You can follow and discuss, more closely, the press reports of Kaiser Permanente’s lapses over at Kaiser Thrive Exposed.)

But back to the paper. The piece also seemed to imply that George Halvorson was safe in his job, a bit of a difference from a year ago when the paper mentioned that “Halvorson [has been] under fire…for a variety of financial and other challenges facing the Oakland-based organization.” This time around, the paper says that “there’s no sign that Halvorson is in trouble with…the board.” Considering he handpicked almost every member of the board, and considering the board seems to be about as concerned about governance as Halvorson’s last board, I’m not surprised. But, I wonder, has the San Francisco Business Times ever spoken with an independent Kaiser Permanente board member? Or, for that matter, has any newspaper in California spoken to any independent Kaiser Foundation Health Plan director?

The Business Times reprinted this bit from a recent entry: “Someday, soon, George Halvorson will be gone, and Kaiser Permanente will have member representatives on its board, it will have a physician as its chief executive…and it’ll have preventive medicine again as a core focus (not as an advertising gimmick).”

Someday, soon.

This story was originally posted at justendeal.com.

When Kaiser Permanente launched the Thrive campaign in 2004, it set out to redefine the way people thought about the organization. I wrote, back in 2005: “It makes a world of difference when you’re pushing forward with a cause and people know why you’re doing it. Our cause is helping people live healthier lives.”

There are 13,000 physicians, 30,000 nurses, dietitians, health educators, pharmacists, and other caregivers at Kaiser Permanente who do go to work every day to help our members.

Yet, as Kaiser Permanente spends tens of millions of dollars each year on the Thrive advertising campaign, the organization is increasingly rolling out health plans that seem to be more about revenue and profit than about preventive medicine (or even medicine, period).

It has been disappointing to see the promise behind Thrive weaken, because I recognized it as a campaign that could have really been transformational for the organization, and not just transformational for the organization’s external image.

Still, when I see a piece like Saturday, one of the two new spots for 2007, I realize there’s still hope for Kaiser Permanente, because for all the disappointing and disheartening stories of our failures, there are still so many people we help, every day. But, that’s another story for another day. So, Saturday. It isn’t flashy. It doesn’t try to sell you anything. It’s just a few shots from a day in the life of one Kaiser Permanente member, who happens to be a cancer survivor. It’s not too often that you can call a commercial “beautiful,” but Saturday is just that.

Here’s the longer, ninety-second version of Saturday…

There’s also a shorter, thirty-second version, which you can see here. (I think Saturday is the best spot from the campaign, even better than Signs. On the flip side, the other new ad, Kid Wisdom, is probably the worst. Go figure.)

My first major in college was public relations, so I pay attention to stuff like this maybe more than I should. But Thrive was, and I hope still is more than just advertising. It is a message. It could be a promise, a promise that if you are (or become) a Kaiser Permanente member, we’ll help you live your life healthier, and we’ll help you get better if something bad happens, and we’ll do all of this, in ways that most other healthcare organizations can’t or won’t. Someday, soon, George Halvorson will be gone, and Kaiser Permanente will have member representatives on its board, it will have a physician as its chief executive, it will have an empowered member’s ombudsman, and it’ll have preventive medicine again as a core focus (not as an advertising gimmick).

One day, soon, Kaiser Permanente will again stand for health.

This story was originally posted at justendeal.com.

Call it HealthConnect, Take Two. Only this time, replace Kaiser Permanente with Sutter Health.

Tim, over at HIStalk, was the first to pick up a story by Chris Rauber covering Sutter’s Epic Systems implementation. The guy in charge over at Sutter, Jerry Padavano, wants to be clear: “I’ve learned from Kaiser’s missteps, and we’re all learning from one another.”

Indeed. They learned a lot. Sutter’s original project budget was $150 million. They’re, so far, up to $500 million. HealthConnect is going to wind up upwards of five times over budget. Sutter is pulling it in at just three times over!

Alright, that was a cheap shot. Cost is important, but as Tim points out in his Universal Rules for Big EMR Rollouts™, maybe the key goal for any electronic medical record project is to get it up and running, “hopefully without killing patients in the process.”

There’s no word from Sutter on reliability or downtime, although the six hospitals aren’t expected to all be live until 2011, so they may still be a bit aways from having any feeling about that. Maybe they will address downtime ahead of time, and maybe that’s one point they will have learned from Kaiser Permanente?

Speaking of HealthConnect… Kaiser Permanente, by my estimates, has now spent upwards of $5 billion on the project (according to Kaiser Permanente: $3.2 billion; according to the Los Angeles Times: $4 billion). Five of our nearly forty medical centers are now live, which, at this rate, means they’re rolling out about three new hospitals a year.

The project was supposed to be completed “nationally” by late 2006. (Don’t laugh.) The outpatient portion now won’t be finished until well into 2008. The inpatient portion now isn’t expected to be completed before 2012.

And that $5 billion spent so far? That’s primarily just for outpatient. Considerably more funding will be spent on the remainder of the inpatient portion. The nearly $100 million figure Sutter is seeing about matches what KP has spent so far to bring hospitals up on HealthConnect. That means an estimate of as much as $3.3 billion more in implementation costs, although the last actual amount budgeted to HealthConnect that I saw was over $4.2 billion from 2008 through 2012.

Assuming the largest figure is the more accurate one (it always is with HealthConnect), that would mean the total, almost ten-year cost of creating an electronic health record network for Kaiser Permanente will come out to over $9 billion. Ten years. $9 billion. The original estimate? Three years and $1.8 billion. (Why did Bruce Turkstra and Cliff Dodd leave Kaiser Permanente, again?)

So, back to Epic.

Let me say that I agree that Epic, today, has one of the best electronic medical record platforms out there when it comes to features. Many of the problems at Kaiser Permanente were infrastructure: poor desktop deployment planning, lousy network design, inadequate change management processes, and so forth, which led, in part, to the poor reliability of HealthConnect. The issue, as I alluded to in the post on IBM and KP getting back together, is that Epic either didn’t try or was ineffective when it came to helping Kaiser Permanente plan adequately for the project, let alone all the contingencies. You’ll find the same problems at Allina, and now at Sutter (both Epic installs), and at any number of other healthcare organizations and hospitals that are transitioning to electronic medical records, regardless of the vendor.

Yet, the key goal for KP, and it appears Sutter, has always been some elusive ability to “improve” billing. The article on Sutter, which has 26 hospitals, points out that the six chosen facilities for the Epic deployment were picked because they account for “roughly half of overall patient volume.” George Halvorson is on the record time and again saying KP desperately needed Epic for the tide of health savings account members that would be coming along any day (you’re not still holding your breath, are you?).

So, as these projects have their top priorities set in billing, the “ideal” of patient safety and the promise of preventing medical errors have taken a back seat. To this day, HealthConnect has only rudimentary procedures in place to track (let alone processes to actually deal with) potential medical errors. While there’s a lot of promise for intelligent diagnosis support and error detection, you won’t find hardly any of that promise in HealthConnect, and I doubt you’ll find much of it in Sutter, either.

Which, I think, means this phase of electronic medical record deployments in the United States will largely be eventually written off as a failure. Perhaps the only saving grace is that these deployments might, might be laying the groundwork for a better round yet to come (through workflow improvements, network infrastructure upgrades, and so forth).

Time (and lots of money) will tell.

This story was originally posted at justendeal.com.

Update: In related news (to the post below), KP today said it has cut 175 positions from KP-IT headquarters in Pleasanton. Nearly two weeks ago, KP said it was laying off 100 employees, so it is not yet clear whether the the 175 figure is an additional round of layoffs or just an upward revision of the original figures released.

You might already know that not a dime of corporate income tax will be paid on that $2.5 billion in profit Kaiser Permanente has made so far this year. That’s because the Kaiser Foundation Health Plan and Hospitals side of Kaiser Permanente long ago applied to the Internal Revenue Service and was granted tax exemption as a “charitable” organization under section 501(c)(3) of the Internal Revenue Code.

What makes Kaiser Permanente different from, say, WellPoint, which owns Blue Cross of California? WellPoint has to pay federal and state income taxes, so why not Kaiser Permanente, you ask? Theoretically, the $800 million that Kaiser Permanente pays out to various community organizations makes it more charitable than WellPoint, which gives away about $300 million each year through its various foundations. Of course, WellPoint is also a publicly-traded company, with shareholders who get a cut of its $3 billion in profit each year. On the flip side, all of Kaiser Permanente’s profit is supposed to go back into the community or into its hospitals (incidentally, both areas which have seen their funding cut significantly recently).

Otherwise, the big requirement that Kaiser Permanente set for itself a number of years ago is that it should operate for the “public benefit,” and that “its assets are irrevocably dedicated to public and charitable purposes.”

Which, at last, brings me to my topic of the day: how is eliminating jobs in California, and moving those jobs to India, Russia, the Philippines, China, and Israel “benefitting” Californians? (More than two-thirds of Kaiser Permanente members are in California, for what it’s worth.)

Two years ago, the California State Auditor did a report on offshoring by organizations which receive money from state contracts. The audit found Kaiser Permanente was one of six out of 39 audited organizations that shipped a portion of its workload to other countries. In the case of Kaiser Permanente, the state auditor found a “small portion” of the dollars the state paid the organization ultimately wound up employing someone in another country, instead of in California.

At that time, I believe about 100 of about 500 employees in the application support division within the organization’s information technology department were offshored. While those figures are important, the big difference is in cost: Kaiser Permanente spent about $107,000 in salary and benefits for the California workers, compared to only about $47,000 for the offshore workers. The direct amount of pay eliminated from the California economy? About $10 million.

No big deal, you say? The application support division offshoring was a test. An experiment. To see how well offshoring worked. Sadly for us, it went pretty well. At that time, about a fifth of the application support team was offshored. The new head of KP-IT, Phil Fasano, has a strong need to continue to cut costs (to keep his own job). What if a fifth of all of Kaiser Permanente’s information technology workforce was offshored? The total direct cost to the California workforce economy would be upwards of $110 million.

So, an organization that is specifically mandated to operate for the public benefit, which has “irrevocably” dedicated all its resources to benefit Californians, is offshoring a significant portion of its workforce. Does eliminating California jobs to cut costs, and shipping those jobs overseas fit within the requirements of a not-for-profit?

I think it’s very difficult to justify, especially for a not-for-profit that’s generating nearly $1 billion in profit every few months, tax free.

What do you think?

This story was originally posted at justendeal.com.