4 Standing on the Shoulders of Giants – In the White House
13 Farewell, Farzad! Outgoing visionary championed EHRs
CMS opens window, invites review of hospital charges
CAQH’s leadership builds bridges,opens doors to a streamlined future where health IT flows easily, well
robe Bob Bowman’s interest in processes and you’ll find yourself plunged deep into the past. Currently focused on administrative simplification, Bob began his professional career as an archeologist, specializing in the Iron and Bronze ages and studying cultures thousands of years old. Prototyping, data collection and analysis, the evolution of artifacts over time: it’s not a stretch to see how that knowledge fed Bowman’s later zest for improving the intricacies of the healthcare system overall. Bowman works with providers, payers, clearinghouses, vendors and many other healthcare organizations around the country on behalf of CAQH®, a nonprofit based in Washington, DC. The group serves as catalyst for industry collaboration on initiatives that simplify healthcare administration. CAQH
CAQH: Due Process
has worked to reduce inefficiencies in healthcare administration for over a decade, and its efforts are increasingly bearing fruit, as documented by growing participation, new initiatives and clear metrics. continued on page 5
From the White House we walked a few blocks down Pennsylvania Avenue to the Willard Hotel for dinner. Ulysses S. Grant stayed at this hotel, and so did President Abraham Lincoln. Martin Luther King, Jr., wrote his â€œI Have a Dreamâ€? speech here in 1963.
The Willard Hotel
Standing on the Shoulders of Giants –
In the White House e traveled from the country’s farthest points to be together. But physical distance by itself wasn’t important. The significance of our journey to the nation’s capital couldn’t be measured in miles alone. The invitation to the White House reflected the stories of untold Sikh immigrants over many decades. The power of their lives and sacrifices were on my mind as I joined other business leaders in a special ceremony held in July at the White House. America fully embraced me and gave me the chance to
survive and thrive. Values of my faith, Sikhism, and U.S.
founding principles coincided to give me the strength to create an opportunity for myself.
continued on page 9
Outgoing ONC leader Mostashari restates urgent case for surmounting the digital divide in U.S. medicine The message was familiar: technology is foundational to improving healthcare. As delivered by Dr. Farzad Mostashari, however, the words took on particular poignancy. One day earlier the National Coordinator for Health Information Technology announced his coming departure. This August 7 joint session with the Center for Medicare & Medicaid Services was among his last such official presentations. And the Dr. Farzad Mostashari
much-admired pioneer in health technology chose the
National Coordinator for Health Information Technology
occasion to focus not on what has been accomplished, but upon how much remains to be done.
Arguing that EHRs not only invite engagement
but empower patients and caregivers, Mostashari
tirelessly promoted their adoption along with demonstrations of meaningful use.
A well-regarded advocate of digital healthcare, Mostashari has drawn heat throughout his tenure with the Department of Health & Human Services. Arguing that EHRs not only invite engagement but empower patients and caregivers, Mostashari tirelessly promoted their adoption along with demonstrations of meaningful use. Doing so provoked ire from those in the industry who maintained that he inflated the benefits of EHRs while downplaying their expense. http://www.healthit.gov/newsroom/webinars » If critics expected Mostashari to soften his position in the final days of office, they were mistaken. The charismatic leader emphasized that the federal government would continue to “clearly signify its commitment to health information exchange, and to the concept that a patient’s information should flow wherever the patient goes and should be available.” Mostashari acknowledged that the state of interoperability remains disconcertingly slow and fragmented. He called for a more rapid pace and broader out-
continued on page 10
continued from front page
The CAQH Committee on Operating
out resistance. Pockets in the indus-
Rules for Information Exchange—
try failed to see the need for national
CORE®—was designated by the De-
operating rules given that some re-
partment of Health and Human Ser-
quirements can be challenging to meet.
vices to perform a critical role. The
According to Bowman, a CAQH CORE
group is the authoring entity for all
manager, “Education and outreach has been critical to the process. The CORE integrated model includes a clear and multi-pronged commitment to provide widespread education about the Operating Rules. We purposefully sought to reduce anxiety and build knowledge in this area through information.”
"People tell us, ‘this isn’t as hard as I thought it was.’ "
Increased understanding—produced through regular webinars, public prethree sets of Operating Rules mandated
The CORE integrated model includes a clear and multipronged commitment to
provide widespread education about the Operating Rules.
by the Patient Protection and Affordable Care Act. CAQH CORE has already developed the first two sets, which include the Electronic Funds Transfer & Electronic Remittance Advice operating rules. Now CAQH CORE is developing the third set to address and support a range of administrative transactions. The Operating Rules increase interoperability and streamline transactions. That not only reduces waste, but also indirectly betters clinical quality, because it frees providers to spend more time with patients.
sentations, organizational-tailored implementation tools, stakeholder-specific test scripts, conference calls and a revitalized website, among many other venues—carries a host of collateral benefits, Bowman explains. “People tell us, ‘this isn’t as hard as I thought it was.’” Better still, participants turn into champions who want to contribute to industry outreach and improvement. “Once they better understand the operating rules and their benefits, they become advocates for their use in other transactions.” Due to the diverse causes of inefficiency in the healthcare system, a steady
"We purposefully sought
to reduce anxiety and build knowledge in this area
through information." CAQH CORE is a multi-stakeholder industry collaboration working to simplify administrative exchange. The adoption
of operating rules has not been with-
stream of CAQH initiatives (beyond CAQH CORE) targets various aspects of the industry. For example, recent CAQH research pegged an opportunity to improve coordination of benefits processes, which could result in potential savings of $800 million annually for providers, health plans, government and other healthcare stakeholders. Introduced this spring, the CAQH Solution, continued on page 11
Kerry Waltrip Senior Vice President, Sales
WHAT’S BREAKING AT EDIFECS
New VP sees bright future in healthcare IT, both here and abroad ismarck, Beveridge, National Health Insurance or Out-ofPocket: one of these four models (or some version) characterizes how most of the world delivers and pays for healthcare. But differing systems aside, all nations share one problem: curbing runaway costs. That’s among the reasons Kerry Waltrip is confident “tremendous opportunity” exists for healthcare IT solutions not just in the United States but on an international scale. Waltrip joined Edifecs in February and brings a background steeped in healthcare IT. The company’s new senior vice president for sales previously held the same position at M*Modal; before that he led Thomson Reuters’ healthcare business. Areas of oversight included HIM analytics, diagnostic imaging, computerassisted coding, revenue cycle management and speech recognition. Altogether Waltrip gained a wideranging, ground-level view of care delivery.
While impediments exist to the adop-
the problem, according to Waltrip. Poor
tion of technology in the provider envi-
communication remains too prevalent
ronment, remarkable progress can be
and it is an example of a low-tech fail-
documented as well, Waltrip believes.
ure with big consequences. “Misunder-
In particular he cites the proliferation of
standing drives waste, undermines the
EHRs. “It’s no longer possible to derail
quality of care and promotes fraud.”
EHRs or electronic documentation because isolated physicians find it ‘inconvenient’ or too difficult to implement. We’ve absolutely crossed a divide in this area.”
Automation not only speeds efficiency within an organization but makes it easier for peak-performing hospitals and clinicians to share best practices. That makes it an exciting time for
Figures bear Waltrip out. A Journal of
vendors producing innovations encour-
the American Medical Association study
aging collaboration, Waltrip believes.
said only 17 percent of physicians used
Meetings with Edifecs’ customers
EHRs in 2008. Earlier this summer
have already given him confidence in
United States Department of Health
the company’s dedication to providing
and Human Services Secretary Kath-
solutions. “They trust us to deliver on
leen Sebelius reported that more than
50 percent of doctors’ offices and 80 percent of eligible hospitals would have EHRs in place by the close of 2013.
transparency and integrity, Waltrip
a consistent patient narrative, Waltrip
versal themes and common standards about quality and prevention in general.” That’s easier said than done, Kerry admits. He cites the experience of one large health insurer that has been aggressively pioneering accountable care organizations. “When they studied
We need to come together
around universal themes and common standards about quality and prevention in general.”
increasingly be called upon to demon-
prove clinical documentation and create
We need to come together around uni-
the healthcare industry.
the industry, healthcare vendors will strate the responsibilities of education,
same way in the healthcare industry.
things the same way in
Just as has happened elsewhere in
That said, much work remains to im-
says. “We tend not to look at things the
“We tend not to look at
While the government has stirred great momentum in the form of stimulus money, policies and mandates, it can’t be expected to fix every difficulty healthcare faces. “Government isn’t going to solve these problems. Private industry will.” Waltrip is a graduate of California Lutheran University. He lives in Granite Bay, California with his wife, Christina.
initial ACO data the results were all over the map—good and bad. It wasn’t easy to draw lessons and conclusions.” But Waltrip is optimistic the research will increasingly yield value. Decades of comparing oranges to apples complicate the already difficult matter of clinical measurement, he says. “Finally good health outcomes should be rewarded, not just random treatment.” Technology solves part—but not all—of
Now you see us—Edifecs in the news
John Kelly was featured in a midsummer story about health insurance marketplaces. CNBC reporter Dan Mangan quoted Kelly in a piece gauging whether states relying upon the federally-facilitated exchange—primarily red on the political spectrum—could actually see greater enrollment rates than the blue. (The federally-facilitated exchange uses online for-profit insurance portals to help enroll consumers.) A former CIO, Kelly was affiliated with the Commonwealth of Massachusetts and Harvard Pilgrim before joining Edifecs as a principal business adviser earlier this year. Deepak Sadagopan was highlighted in On The Record, a national industry publication; he discussed the subject of dual coding in response to the ICD-10 transition. Edifecs’ general manager of clinical solutions spoke about how soon providers should begin coding in ICD-10 to soften operational and financial impacts. Sadagopan noted that while there was little doubt productivity would suffer, “with the appropriate budgeting and training in place, providers and medical coders can minimize the impact associated with the transition.”
Best workplace – by anybody’s measure
The Puget Sound Business Journal’s annual list of best workplaces included Edifecs—for the third straight time. This year more than 300 companies were nominated. Employees were then invited to complete surveys. According to the Journal’s publisher, Gordon Prouty, only scores from questionnaires determined finalists. “You can’t pay to be on our list. Finalists are evaluated by their employees in the areas of environment, opportunities and benefits provided.” The Journal’s nod wasn’t the only recognition Edifecs received this summer. In August, Modern Healthcare also named Edifecs a best workplace. This designation, which evaluates employers on a national basis, was a first for Edifecs.
Vermont selects HIX Integration Solution
Blue Cross and Blue Shield of Vermont, the state’s largest insurer, has selected Edifecs as its technology partner in preparation for integration with Vermont Health Connect. Vermont Health Connect is the health insurance marketplace which expects to enroll more than 100,000 residents beginning between now and March 31, 2014. Of key concern for health plans during the first year or two of operating on an HIX are changes and disruptions that will occur as state exchanges, the federal government and the healthcare industry work toward stable processes. The Edifecs HIX Integration Solution serves as a “guardian” for a health plan’s HIX business—shielding and monitoring interactions with HIXs, financial institutions and the federal government. It ensures that only accurate and timely information is sent to core membership systems or reported to the federal government.
Acquisition of patent underscores Edifecs vow: transforming healthcare
Edifecs’ medical concept ontology—originally developed by Drs. Paraq Patel and Abhishek Jacob—is now based on patented algorithms. The medical concept database already differentiated the company in the ICD-10 market. According to company leaders, Edifecs’ scientific and methodical approach is unique; accurate mapping is the foundation for any medical code migration project. They add that manual translation approaches such as GEMs and other mapping content rely heavily upon individual decision-making by medical coders and clinicians. Edifecs’ technology and content render the process more methodical and its mappings more reliable.
continued from page 3
The occasion was the 100th anniversary
in Bellevue, Washington, Edifecs associ-
of the arrival of Bhagat Singh Thind, a
ates are located across the United States
Sikh and pioneer in the American armed
and at satellites in India, Moldova an the
forces. Members of the White House staff
used the forum to provide updates on policy initiatives, such as the recent immigration reform bill. They stressed the importance of the Sikh community, its contributions and notable business acumen. We discussed how to ensure opportunity for those who come after us, and the Obama administration’s desire to maintain a dialog in the years ahead.
My colleagues at the White House cel-
I was honored to be among the three
ebration shared my sense of awe and
business entrepreneurs asked to address
gratitude for our inclusion in this histor-
the group. I confess I was a little nervous
ic event. Here’s how Charanjeet Singh
at the prospect. In the end the words
Minhas, CEO of a Delaware IT company,
came easily, as they usually do when the
described the day: “The group of Sikh
subjects are my relationship with the
business leaders who met in the White
United States or the company I started,
House to discuss, evolve and improve the
path of progress, equality and prosperity
The audience of around 150 heard about the fundamental shift in healthcare
were left in no doubt that America is for you, Sikhs, and all.”
and our company’s role in accelerating
From the White House we walked a few
reform for major insurers and health
blocks down Pennsylvania Avenue to the
systems. The saga of Edifecs—how we
Willard Hotel for dinner. Ulysses S. Grant
persevered past a financial low point—
stayed at this hotel, and so did President
was also shared. Mostly I spoke from
Abraham Lincoln. Martin Luther King, Jr.,
the heart about my immigration to the
wrote his “I Have a Dream” speech here
United States. Here is one of things I said:
“America fully embraced me and gave me the chance to survive and thrive. Values of my faith, Sikhism, and U.S. founding principles coincided to give me the strength to create an opportunity for myself.”
House to discuss, evolve and
improve the path of progress, equality and prosperity were
left in no doubt that America is for you, Sikhs, and all.
yet again of the millions who paved the way for us, whose hardships and contributions left such a rich legacy. Could they ever have imagined this day in the White House? “If I have seen farther it’s because
values for our internal community. These
I sat on the shoulders of giants,” Newton
include innovation, respect and communi-
once said. That truth is both humbling
cation. We believe these qualities are vital
and a call to push harder, to achieve still
and instrumental to growth. Success is
with professional ones. Headquartered
leaders who met in the White
These brushes with history reminded me
Recently Edifecs adopted a set of core
unlikely when internal standards conflict
The group of Sikh business
Sunny Singh Edifecs CEO & President
continued from page 4
look. Interoperability, he stressed, must take place across a spectrum, including home healthcare and long-term care. “We need to get smarter and acquire the best thinking from IT, payment and provider” to shore the business case. Regrettably, the business case for HIE remains less than compelling, Mostashari said, and he warned that it would take strong steps on many levels to change that picture, beginning with clear rewards for coordination. “Information exchange is a critical enabler of new payment models succeeding.” “As National Coordinator he brought energy, enthusiasm, and momentum to healthcare IT. He inspired, challenged, and influenced with informal authority, never a heavy hand. Hundreds of people volunteered to support his vision out of respect for his ideas and a sense that it was the right thing to do.”
-JOHN HALAMKA Other factors highlighted by Mostashari and speakers Dr. Patrick Conway and Cindy Mann, both of CMS, included the need for boots-on-the-ground implementation support, articulation of a clear vision for the future. The three also stressed the development of policies and programs encouraging providers to routinely share information across healthcare settings would continue.
“ The patient’s information should flow wherever the
patient goes and should be available.”
Vendor assistance was another under-used resource, Mostashari said. “We can’t rely on one thing to achieve our goals…we need a sustained one across the whole healthcare system and we’re committed to incremental but strategic change.” In a letter announcing the change at ONC, HHS Secretary Kathleen Sebelius praised Mostashari for having “seen through the successful design and implementation of ONC’s HITECH programs, which provide health IT training and guidance to communities and providers; linked the meaningful use of electronic health records to population health goals; and laid a strong foundation for increasing the interoperability of health records.” “Some people seek fame and fortune. Some just want to make the world a better place,” wrote emergency physician and industry blogger Dr. John Halamka of Mostashari. Earlier this month Mostashari announced he would soon join the Engelberg Center for Health Reform at the Brookings Institution.
continued from page 5
COB Smart™, offers a single source of
regard for the iterative approach. Take
timely, accurate coverage status, en-
the case of the Operating Rules. CAQH
abling providers to properly bill insurers.
CORE began developing voluntary
Industry-wide participation is expected
Operating Rules via phases in 2005,
to amplify the impact of the initiative,
well before the recent ACA mandates.
smoothing the claims process for all
CAQH CORE Phase I targets eligibil-
ity. CAQH CORE Phase II adds to the
The COB initiative follows CAQH’s highly successful Universal Provider Datasource®, used by over 700 of the nation’s leading health plans, hospitals and healthcare organizations. More than 1.1 million providers self-report their professional and practice information to UPD and are simplifying credentialing at a savings that’s estimated to top $135 million annually. Debuting a decade ago, the UPD still draws 7,000 new participants each month.
requirements for eligibility and also includes the claim status transaction. CAQH CORE Phase III includes rules for EFT and ERA transactions. A number of studies confirmed the economic payoff to plans which voluntarily adopted the CAQH CORE Phase I Operating Rules.
“Large health plans and vendors recognized the significance and came
aboard some time ago. But
the smaller providers can be difficult to reach.”
Longitudinal research by IBM studying health plans covering 33 million lives showed that the CAQH CORE Phase I Operating Rules could yield industry savings of $3 billion dollars over three
More than 130 health plans, hospitals, vendors, clearinghouses, trade associations and other industry leaders participate in CAQH CORE. Collectively they represent over 150 million lives or 75 percent of the commercially insured plus Medicare and some state-based Medicaid. Bowman has been with CAQH CORE for five years. Previous roles at Humana and Xerox broadened his perspective about the impediments even the best approaches face in the healthcare industry.
Bob Bowman years. Another—assessing CAQH CORE
Take Bowman’s own moment of truth.
Phase II—showed the Operating Rules
While building out the ability for provid-
decreased claims denials. This was also
ers to receive Electronic Funds Transfer
significant because “addressing these
and Electronic Remittance Advice, pro-
is very labor-intensive for providers,”
viders had to complete a paper enroll-
ment form and then submit it through the post office or via fax. The irony was striking. So the next step was to implement an electronic, automated means to enroll providers to receive these transactions. That experience instilled a practical
The first phases of CAQH CORE Operating Rules – which later were adopted
“In the current environment nobody can afford to wait
for payment, especially not the provider. Real-time
transactions are critical to survival.”
as the first two sets of federally-mandated Operating Rules – yield significant cost-savings. However, the third set of mandated Operating Rules is “transfor-
mational … because it carries the poten-
tive has since come under the aegis of
tial to reduce administrative expenses by
CAQH—estimates that the country could
billions of dollars over the next decade
realize as much as $30 billion in savings
alone,” Bowman says.
with the widespread adoption of basic
Granted, the third set of rules is much more complicated, and covers transactions, claims and encounters, enrollment and disenrollment, health plan premiums referral, certifications, and authorizations. “Essentially the third
electronic administrative transactions. Founded in 2008 and representing all facets of the healthcare industry, the CAQH Index creates a national reference for raising awareness and monitoring progress toward business efficiency.
set of rules allows the industry to cre-
Also critical to ongoing efficiency is the
ate a path to begin transformation on
continuing drive for improvement in the
the remaining transactions,” Bowman
industry generally. “We’re proud of the
breadth of our operating rule education.
Supporting the success of the third set— to take effect January 1, 2016—means enlisting all of the skills CAQH CORE has carefully nurtured since its inception in 2005. That includes building consensus with diverse stakeholders and learning their individual perspectives. The process won’t be easy, Bowman acknowledges. “Large health plans and vendors recognized the significance and came aboard some time ago. But the smaller providers can be difficult to reach.”
We’re getting a lot of feedback that it’s working very well. But there’s no doubt that answers—for that matter questions, too—need to come from an array of diverse sources.” CAQH will continue to not only educate the industry on the operating rules, but will also look for other
“Ideal healthcare . . . is a seamless process, from
scheduling on a mobile device to receiving appropriate care, and knowing exactly what
your co-pay and deductible are before leaving the
physician’s office. Real-time
information shouldn’t be an
idealized state. It’s a goal we
should be marching toward.”
causes of inefficiency and tackle those areas through their integrated model. Bowman is clear about what quality healthcare should look like. “It’s a seamless process, from scheduling on a mobile device to receiving appropriate care, and knowing exactly what
An estimated 10 percent of healthcare
your co-pay and deductible are before
expenditures in 2009—$289 billion—can
leaving the physician’s office. Real-time
be chalked up to administrative costs
information shouldn’t be an idealized
and those divide evenly between pro-
state. It’s a goal we should be marching
vider and payer. As more of the health-
care burden shifts from employers and payers, providers will increasingly be chasing patients for co-pays and uncovered expenses. Not only will that accentuate the providers’ financial problems
LINKS www.caqh.org/ORMandate_EFT.php » www.ushealthcareindex.org/index.php »
it will compound the consequences of delayed transactions. “In the current environment nobody can afford to wait for payment, especially not the provider. Real-time transactions are critical to survival,” Bowman believes. A 2010 report published by the U.S. Healthcare Efficiency Index™—the initia-
CMS website opens window on hospital charges; officials seek help in explaining wide variations century ago the cost of healthcare in the United States was minimal, and that made sense. Physicians carried very few tools in their medical arsenal and thus had little to offer patients. A vaccine existed for only one disease—smallpox. More than 90 percent of births occurred in the mother’s home. Today the situation is vastly different; in fact, Americans pay more for their care than anyone else in the world. Unfortunately, clarity about prices hasn’t grown along with the sheer volume of services. New federal reports released this summer—comparing charges for common inpatient and outpatient procedures—reveal bewildering inconsistency. Available on the Centers for Medicare and Medicaid Services website, separate links provide fees for the 100 most common inpatient procedures and 30 most typical outpatient services as reported by several thousand hospitals. While medical facilities have reported their charges at various times in the past, a host of contingencies made these figures less than credible. The numbers posted by the CMS, in contrast, represent unprecedented scope and size, representing approximately 60 percent of Medicare payments in 2011.
"Our mission and goal from the ACA is to make the
healthcare marketplace more transparent."
Deputy administrator Jonathan Blum described the mammoth effort as part of “our mission and goal from the ACA to make the healthcare marketplace more transparent.” While Blum said he anticipated minor variation in hospital charges he was unprepared for the wide incongruity the data ultimately showed. Cost of a joint replacement, for example, ranged from $5,300 to $223,000 in different states. Prices for heart-failure treatment could fall between $9,000 and $51,000 within the very same city. Common explanations—the unique situation of academic teaching centers, or illness severity among an institution’s average
patients—simply don’t account for the extraordinary discrepancies, Blum said,
explaining that DRGs are already weighted for these and many other factors, for such as wages in a particular geographic location. He added that, “we have done analysis ourselves, but clearly more folks are needed to dig in and help reform a complicated marketplace.” Interest in fee drivers isn’t an arbitrary exercise for the federal government, essentially the nation’s largest health insurer. While Blum acknowledges that few if any individuals pay the full listed charges, opening the information to public view and engaging discussion “allows people to more broadly examine disparities and why variations exist. Why is there such a discrepancy between hospital charges and what Medicare says is a fair price?” Insurance companies, public interest groups and the average individual all conceivably have a stake in understanding the rationale behind hospital charges, Blum believes. Response to the CMS action was mixed, with some experts asserting it did little to explain why charges were so uneven. Hospital industry leaders called
"The problems facing
American healthcare took decades to create. It will
clearly require concerted, collective thinking from
across the industry to turn the situation around. I’m confident we’ll succeed."
for greater exploration of the equally irregular fees industries charge providers in different areas for the same medical products. As a recent New York Times article noted, this applies not just to expensive technology but simple commodities like saline solution. According to AHIP, increasing and accelerating consolidation of hospitals also figures into pricing.
EXPLORE HOSPITAL CHARGES ON THE CMS WEBSITE. http://www.cms.gov/Research-Statistics-Data-and-Systems/StatisticsTrends-and-Reports/Medicare-Provider-Charge-Data/