health information technology - tenet...
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Health Information TechnologyIMPACT Program Overview
Liz Johnson and Paul BrowneApplied InformaticsOctober 18, 2012
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Forward-Looking Statements
Certain statements contained in this presentation constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements are based on management's current expectationsand involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results to be materially different fromthose expressed or implied by such forward-looking statements. Such factors include, among others, the following: the passage of heath carereform legislation and the enactment of additional federal and state health care reform; other changes in federal, state and local laws andregulations affecting the health care industry; general economic and business conditions, both nationally and regionally; demographic changes;changes in, or the failure to comply with, laws and governmental regulations; the ability to enter into managed care provider arrangements onacceptable terms; changes in Medicare and Medicaid payments or reimbursement; liability and other claims asserted against the Company;competition, including the Company’s ability to attract patients to its hospitals; technological and pharmaceutical improvements that increase thecost of providing, or reduce the demand for, health care; changes in business strategy or development plans; the ability to attract and retainqualified personnel, including physicians, nurses and other health care professionals, and the impact on the Company’s labor expenses resultingfrom a shortage of nurses or other health care professionals; the significant indebtedness of the Company; the Company's ability to integrate newbusinesses with its existing operations; the availability and terms of capital to fund the expansion of the Company's business, including theacquisition of additional facilities; the creditworthiness of counterparties to the Company’s business transactions; adverse fluctuations in interestrates and other risks related to interest rate swaps or any other hedging activities the Company undertakes; the ability to continue to expand andrealize earnings contributions from the revenue cycle management, health care information management, capitation management, and patientcommunications services businesses under our Conifer Health Solutions (“Conifer”) subsidiary by marketing these services to third party hospitalsand other health care-related entities; and its ability to identify and execute on measures designed to save or control costs or streamline operations.Such factors also include the positive and negative effects of health reform legislation on reimbursement and utilization and the future designs ofprovider networks and insurance plans, including pricing, provider participation, coverage and co-pays and deductibles, all of which containsignificant uncertainty, and for which multiple models exist which may differ materially from the company's expectations. Certain additional risksand uncertainties are discussed in the Company’s filings with the Securities and Exchange Commission, including the Company’s annual report onForm 10-K and quarterly reports on Form 10-Q. The information contained in this presentation is as of October 18, 2012. The Company specificallydisclaims any obligation to update any forward-looking statement, whether as a result of changes in underlying factors, new information, futureevents or otherwise.
Non-GAAP Information
This presentation includes certain financial measures such as Adjusted EBITDA, which are not calculated in accordance with generally acceptedaccounting principles (GAAP). Management recommends that you focus on the GAAP numbers as the best indicator of financial performance.These alternative measures are provided only as a supplement to aid in analysis of the Company. Reconciliation between non-GAAP measures andrelated GAAP measures can be found in the Company’s second quarter earnings release issued on August 7, 2012.
• Health Information Technology (HIT) – term that generally refers to advanced clinical information systems but can be applied more broadly to include any information technologies used in healthcare
• Meaningful Use (MU) – a federal program designed to encourage the adoption of HIT by physicians and hospitals, the program includes incentive payments for meeting defined criteria for the implementation and usage of advanced clinical information systems
• IMPACT – Tenet’s program for meeting Meaningful Use requirements and, more broadly, to advance clinical process improvement and prepare for new payment methodologies that link payment to clinical outcomes, IMPACT is an acronym for Improving Patient Care through Technology
Key Terms
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• Industry Evolution and the Role of HIT
• Meaningful Use Program
• IMPACT Program
• Tenet Current Status
• Value
• Tenet Differentiators
Discussion Outline
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Healthcare Industry Evolution
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Healthcare Information Technology (HIT/MU)
Comparative Effectiveness
Research (CER)
Payment Reform
(VBP/ACO)
Intersecting Reform Elements
Meaningful Use Program Overview
Data capture and sharing
Advanced clinical processes
Improved outcomes
Conceptual Approach to Meaningful Use
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• IMPACT Vision To provide the right information when and where it’s needed to improve
the care and life of every person in the communities that we serve
• IMPACT Mission Electronic Health Record in all Tenet facilities by 2015 High levels of clinician adoption Share health information in our hospitals and across our communities
IMPACT Vision and Mission
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IMPACT Core Technology Components
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Inpatient clinical documentation Computerized Physician Order Entry (CPOE) Bar Coded Medication Administration (BCMA) Bedside Medical Device Interfaces (BMDI) Pharmacy Lab Radiology Surgery Scheduling Clinical Decision Support ePrescribing
• 49 Acute Care Hospitals
• 30,000+ Users
• 9m+ Monthly Digital Chart Accesses
• 24m+ Monthly Digital Orders
• 150 Terabytes of Data
• 10m+ Unique Patient Records
IMPACT Scope and Scale
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The scope and scale of IMPACT create an unparalleled opportunity for analytics-driven clinical process improvement.
26 hospitals completed 14 hospitals in progress 9 hospitals starting by January 2013Coral Gables
DelrayDesert RegionalDes PeresDoctors – White RockFlorida Medical CenterFrye RegionalGood SamaritanHialeahJohn F. KennedyNacogdochesNorth ShorePalm Beach Gardens
BrookwoodCentral CarolinaDoctors – MantecaDoctors – ModestoFountain ValleyHahnemann UniversityHouston NorthwestLakewoodLos AlamitosNorth FultonPiedmontSt. Christopher’sSt. Francis ‐ BartlettSt. Francis ‐Memphis
Atlanta MedicalCentennialCoastal CarolinaCypress FairbanksEast CooperHilton HeadLake PointePark PlazaSouth Fulton
IMPACT Current Status
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Palmetto GeneralPlacentiaProvidence MemorialSaint Louis UniversitySan Ramon Sierra Medical CenterSierra Providence EastSierra VistaSpalding RegionalSt. Mary’s Medical Sylvan GroveTwin CitiesWest Boca
53% of Tenet hospitals have completed implementation, the remaining hospitals are targeted to complete implementation by mid-2014
Computerized Physician Order Entry
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Stage 2 Meaningful Use CPOE Requirement (effective Oct 1,2013) - Sixty percent (60%) medications, 30 % of radiology, and laboratory orders be placed using CPOE
Meds
Lab &
Rad
All Tenet hospitals live on IMPACT systems are meeting Meaningful Use Stage I CPOE requirements. Eleven hospitals are already meeting Meaningful Use Stage 2 requirements.
Meaningful Use Stage 2 CPOE Performance – as of September 2012
Stage 2 Required Performance Levels
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2009 2010 2011 2012 2013 2014 2015 2016 2017
Healthcare IT (HIT) Program Expense(1) $12 $21 $41 $50 $38 $26 – – –
HIT Incentives – – $55 $34 $75 $75 $50 $25 $5
EBITDA Impact ($12) ($21) $14 ($16) $37 $49 $50 $25 $5
HIT Capital Expenditures $49 $64 $66 $141 $80 $32 – – –
Foundation Systems (# Go-Live) – 7 13 10 19 – – – –
CPOE Systems(# Go-Live) – – 7 19 14 9 – – –
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HIT Investment Summary
___________________________1. Excludes recurring clinical support operating expenses and HIT benefits to operating performance.
Positive net impact on EBITDA starting in 2013
($ in millions)
Penalties avoidedby achieving
“Meaningful Use”(Net present
value of $315mm)
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EBITDA contribution from IMPACT becomes positive in 2013 – a $53m change from 2012
HIT Benefits Opportunity Areas
Clinical Benefits
• Improved quality measures
• Reduced adverse drug events
• Decreased non-formulary drug use
• Decreased duplicate lab and radiology tests
Financial Benefits
• Reduced formsand paper costs
• Improved charge accuracy
• Reduced payment denials
• Reduced transcription costs
Operational Efficiencies
• Decreased order turn-around time
• Decreased chart abstraction time
• Improved nursing productivity
• Improved pharmacy productivity
Satisfaction Benefits
• Improved patient satisfaction
• Improved employee satisfaction
• Improved physician satisfaction
Industry experience is demonstrating benefits of electronic health records in many areas including …
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• Duplicate Lab Tests Avoided = 211,162 (2.8%)
• Duplicate Radiology Tests Avoided = 24,815 (2.4%)
• Reduced Medication Administration Events = 157,550 (0.8%)
• Potential Adverse Drug Events Identified = 2,381
• Paper Cost Reduction = $1m+
HIT Benefits at Tenet – Early Results
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Cumulative measures for hospitals live on IMPACT systems through September 2012
Tenet’s early results indicate significant benefits can be realized from the investment in IMPACT.
• Early Mover
• Common Clinical Platform
• Integration with Process Improvement
• Population Health and Acute Care Expertise
Tenet Differentiators
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Tenet is one of the few (<10) health systems in the US that have the geographic reach and deep expertise to identify and eliminate unnecessary variation in care – we have the social obligation and the business imperative to do so!