DISSERTATION PROPOSAL DEFENSE ARGOSY UNIVERSITY COLLEGE OF BUSINESS

August 10th, 2015

Candidate: Joseph C. Makres

Dissertation Chair: Dr. David Hancock

Dissertation Member: Dr. Steve Shao

A HEALTHCARE MANAGEMENT PROBLEM FOR TODAY’S HEALTHCARE EXECUTIVES

Today’s Healthcare Environment Healthcare Consultant Perspective

CIOs looking for guidance on what strategy / approach to take for their particular organization

$100 Million Dollar Investment

Maximum reimbursement with the highest quality care

Data/literature lacking on VBP Program performance and health information technology strategies

Literature and information on EMRs and financial metrics available – only at application level

Healthcare executives looking for answers

PROBLEM

Uncontrolled U.S. Healthcare Expenditures

Poor Quality Performance

Increased financial investment in health information technology (HIT)

Fragmented healthcare system

Disparate HIT applications without integration

Transformational change to reimbursement model

Fee-for-service to value-based care

Failed HIT implementation can cost millions

How to determine HIT return on investment

WHAT IS THE PROBLEM

Real-world Example:

Disparate Systems

Care Coordination

Patient-Centered Care

PURPOSE

Examine whether HIT can improve quality, increase efficiency, and reduce costs

$20 billion allocated to HIT in 2009 ARRA

Hospital reimbursement based on Quality not quantity

Value-Based Purchasing (VBP) Program (1.5% in 2015)

Accountable Care Organization (ACO) contracts

Literature identifies three key HIT management strategies

How do they impact quality outcomes

How do improve efficiency

Does more or less integration improve performance

#2 How have HIT management strategies changes over time?

SIGNIFICANCE

Managerial decision-making Healthcare executives making multi-hundred million dollar decisions What is the best way to organize their IT department, HIT applications,

and overall HIT management strategy to achieve the greatest ROI Improve patient satisfaction Increase overall quality of care How will we meet Meaningful Use and receive Medicare’s financial

incentive Stage 1 Stage 2

Effective HIT management requires: Planning Coordination Work Redesign Change Management

Study will help healthcare executives evaluate and make important decisions on which HIT management strategy provides them with the best quality of care for patients and maximum financial reimbursement!

RESEARCH QUESTIONS

Are there significant differences in VBP Total Performance Scores for acute-care hospitals pursuing single-vendor, best-of-breed, or best-of-suite HIT management strategies?

Null Hypothesis No significant difference in performance between HIT

management strategies

Has the proportion of HIT management strategies within the acute-care hospital population changed over time?

Null Hypothesis HIT management strategy proportions have not

changed over time

THEORETICAL PERSPECTIVE

Value-Based Purchasing Programs

Ability to change provider behavior

Davis & Damberg

Principal-Agent Theory

Environmental Uncertainty

Changes to reimbursement method

Compliance with payer demands/contracts

Interoperability & HIT

Resource Dependency Theory

Pfeffer & Salancik (1978)

Kazley & Ozcan (2007)

Menachemi, Shin, Ford, & Yu (2011)

HOW

Quantitative, non-experimental, cross-sectional analysis with longitudinal component

Data

HIMSS Analytics Database (2009 & 2012)

Value-Based Purchasing – Total Performance Score

Fiscal year 2015

One-way ANOVA with post hoc pairwise comparisons

Chi-square goodness of fit

Simple Regression for each strategy

SIGNIFICANT LITERATURE REVIEW FINDINGS

SIGNIFICANT LITERATURE

Over 130 references

Briggs (2003) Identified and labeled health IT strategies into

separate categories based on other industries Single-Vendor (SV) - enterprise-wide planning software

products are designed to integrate administrative, clinical, and strategic applications across multiple locations and provide hospitals with out-of-the box solutions

Best-of-Breed (BoB) - offer more suitable products for the needs of any department adopting this technology because they offer richer domain-specific functionality, and since they are designed for a specific department result in greater buy-in from staff

Best-of-Suite (BoS) - are a mix between BoB and single-vendor approaches where hospitals use one package of applications as the basis for integrating all other applications within specific functional units

LITERATURE REVIEW

Kazley & Ozcan (2007) Linked hospital use of HIT to securing necessary resources

(i.e. patient demand and financial reimbursement) under a Resource Dependence Theory perspective

Burke, Yu, Au, & Menachemi (2009) First to identify frequency of IT management strategies

pursued by U.S. hospitals SV (61%)

BoS (29%)

BoB (10%)

In-house (<1%)

Hospital characteristics associated with one strategy over another Larger hospitals – BoS or SV Strategy

Small & Medium Hospitals – SV Strategy

LITERATURE REVIEW

Ford, Menachemi, Huerta, & Yu, (2010) Hospitals using BoS approach had fully implemented

HIT systems in significantly greater proportions than did hospitals employing either of the other strategies

Menachemi, Shin, Ford, & Yu, (2011) Number of managed care contracts per hospital (rate

of change or innovation) was negatively associated with SV

Complexity (market competition) was positively associated with BoB

Greater environment munificence negatively associated with SV approaches* When access to resources is high, hospitals tend to choose

BoS strategies

Resource Dependency Perspective

METHODOLOGY – PARTICIPANT SELECTION

U.S. acute-care, non-Veterans Administration hospitals

Both databases

Participants in HIMSS Analytics Survey

Participants in Medicare VBP Program

Burke et al. (2009), Ford et al. (2010), Menachemi et al. (2011)

2008 HIMSS Analytics Database – HIT Management Strategy

METHODOLOGY – RESEARCH INSTRUMENT

Secondary Data Resources

2009 & 2012 HIMSS Analytics Database Survey

2009 Microsoft Access dataset

2012 Microsoft Access dataset

Granted access to HIMSS Analytics + Dorenfest Institute for Health Research Database

Hospital VBP Program Results

Fiscal Year 2015

Over 3,000 acute-care hospitals

Data collected through the Hospital Inpatient Quality Reporting (IQR) Program (CMS, 2013)

Publicly available data

METHODOLOGY – VALIDITY & RELIABILITY

Burke et al. (2009), Ford et al. (2010), & Menachemi et al. (2011) Collected HIT management strategy selection from 2008

HIMSS Analytics Database

One-way ANOVA statistical test Normal distribution verification

Commonly used test to determine if sample populations have equal variances (Lind, Marchal, & Wathen, 2010).

Chi-square goodness-of-fit Normal distribution verification

Commonly used test for expected frequencies (Lind, Marchal, & Wathen, 2010)

Utilized by Menachemi et al., (2011)

METHODOLOGY – DATA ANALYSIS

Data matching

Medicare provider number

Same methodology as Burke et al. (2009), Ford et al. (2010), & Menachemi et al. (2011)

Statistical Procedures

SPSS Premier Grad Pack V22.0

METHODOLOGY – LIMITATIONS/DELIMINATIONS

First study to attempt correlation between HIT management strategies and VBP performance

Participants focus on acute-care U.S. hospitals Not Included: Provider Groups/Networks Home health

facilities, skilled nursing facilities

VBP performance data relatively new and evolving rapidly which will limit ability to generalize about future situations

Dependent on secondary databases not under control of investigator

Control variables, organizational characteristics, and/or environmental characteristics

Scalability Examine individual departments, not entire hospital?

SIGNIFICANCE TO HEALTHCARE COMMUNITY

Healthcare Executives & Management Limited data available linking HIT to VBP performance

Healthcare industry is fragmented (Porter & Tiesberg, 2006), but so is HIT within individual hospitals.

Several studies have already examined relationship between the number of HIT systems and financial performance (FFS not P4P)

First study that looks at performance through pay-for-performance reimbursement instead of traditional DRG-based payments

This study will shed some light on how effective these changes have been at achieving the National Quality Strategy’s strategic objectives and triple aim of better care, better health, and lower costs.

REFERENCES Briggs, B. (2003). The main event: Best-of-breed vs. single-source. Health Data Management,

11(6), 41-4, 46-8. Retrieved from http://search.proquest.com/docview/219533182?accountid=34899

Burke, D. E., Yu F., Au, D., & Menachemi, N. (2009). Best of breed strategies: Hospital characteristics associated with organizational HIT strategy. Journal of Health Information Management, 23(2), 46-51.

Creswell, J. (2009). Research design: Qualitative, quantitative, and mixed methods approaches, (3rd ed.). Thousand Oaks, CA: Sage Publications.

CMS. (2013). FY-2013 Frequently Asked Questions About Hospital Value-Based Purchasing Program. Retrieved from http://www.hospitalcompare.hhs.gov

Ford, E. W., Menachemi, N., Huerta, T. R., & Yu, F. (2010). Hospital IT adoption strategies associated with implementation success: Implications for achieving Meaningful Use. Journal of Healthcare Management, 55(3), 175-188.

Helton, J. R. (2011). Assessing the impact of electronic health record technology adoption on hospital labor efficiency. (Order No. 3459837, The University of Texas School of Public Health). ProQuest Dissertations and Theses, 153. Retrieved from http://search.proquest.com/docview/875816135?accountid=34899. (875816135).

Kazley, A. S., & Ozcan, Y. A. (2007). Organizational and environmental determinants of hospital EMR adoption: A national study. Journal of Medical Systems, 31(5), 375-84. doi:http://dx.doi.org/10.1007/s10916-007-9079-7

Lind, D. A., Marcha, W. G., & Wathen, S. A. (2010). Statistical Techniques in Business and Economics (14th e.d.). McGraw-Hill Companies, Inc., New York, NY

Menachemi, N., Shin, D. Y., Ford, E., & Yu, F. (2011). Environmental Factors and Health Information Technology Management Strategy. Health Care Management Review, 36(3), 275-285

Pfeffer, J., & Salancik, G. R. (1978). The External Control of Organizations. Stanford University Press, Stanford, CA.

APPENDIX

Follow Up Question & Answer

SIGNIFICANT / IMPORTANT TERMS

HIT Management Strategies Single-Vendor

Best-of-Breed

Best-of-Suite

Hospital Value-Based Purchasing (VBP) Program Total Performance Scores

Process of Care Measures

Outcomes Measures

Patient Satisfaction

Efficiency Measures (Medicare Spending per Beneficiary)

American Recovery & Reinvestment Act (ARRA)

Patient Protection & Affordable Care Act (PPACA)

Health Information & Management Systems Society (HIMSS)

Health Information Technology for Economic and Clinical Health (HITECH Act)

METHODOLOGY – DATA ANALYSIS

Hypothesis 1

One-way Analysis of Variance

Post hoc pairwise comparisons

Scheffe’s Tests

Hukey’s Test

LSD

Bonferri’s test

Pearson’s Correlation Coefficient

Hypthesis 2

Chi-Square & Simple Regression (Goodness of Fit)

Analyze HIT management strategy proportion over time

PURPOSE & RESEARCH QUESTION

Hospitals & Providers

HIT Investments

IT Resources

Purchasing Strategies

Return on Investment

Payers & Reimbursement Reform

Value-Based Purchasing (VBP) Programs

Pay-for-Performance Contracts

Accountable Care Organizations

Bundled Payment Contracts

Do HIT investments lead to better quality and efficiency outcomes for hospitals and patients?

PROBLEM BACKGROUND

2009 ARRA legislation increased hospital & provider investment in health information technology (HIT) Massive adoption of HIT application and systems through

EHR Incentive Program “Meaningful Use”

2010 Affordable Care Act introduced new reimbursement method – Value-Based Purchasing (VBP) Program Significant departure from traditional fee-for-service

reimbursement to one based on quality, outcomes, & performance

Hospital, Providers, & Payers Improve patient quality & outcomes by restructuring

payment system Reliance on HIT to deliver efficiency and coordination

necessary to achieve quality & performance objective while at the same time lower out-of-control healthcare expenditures

PROBLEM & BACKGROUND INFORMATION

Healthcare Reform Reimbursement Model Experiments

Quality or Value-based Care Concept

Affordable Care Act (2010) Hospital Value-Based Purchasing Program

American Recovery & Reinvestment Act (2009) The Health Information Technology for Economic & Clinical

Health (HITECH) Act The Office of the National Coordinator of Health Information

Technology (ONCD) $20 Billion toward HIT CMS EHR Incentive Program “Meaningful Use”

ACA & ARRA Combined Objective & Outcomes Quality & Efficiency Improvement Care Coordination & Information Sharing Data Analytics: Predictive Modeling Workflow & Process Redesign

PROBLEM & BACKGROUND

Hospitals Costs

Quality of Care

Efficiency

Cost Containment

Health Information Technology (HIT) Investments

Value-Based Purchasing

Care Coordination

Pay-for-Performance

Accountable Care Organizations

Bundled Payment Contracts