UCSF Medical Center CEO Explains: Why Epic

He was on the recent HealthTech Capital conference panel about the challenges that the health care ecosystem at large creates for his physicians. Yet the CEO of UCSF Medical Center Mark Laret found himself explaining why an internal decision ― the decision to contract with Epic Systems for an electronic health record deployment ― was a good one.

The question was apt. Many health care wonks nutty about the EHR space would love to bump into the CEO of a big hospital, grab him by the shoulders and ask: Why Epic??

“I think Epic is successful,” Laret answered, “not because it’s so good, but because the others are so bad.”

Despite this explanation, every time Epic gets another deal, hearts sink. Many feel there’s got to be a better way. The UCSF deployment cost more than $160 million. In May, Partners HealthCare in Boston initiated a 10 year deal with the vendor that will cost between $600 and $700 million. Journalist Zina Moukheiber wrote in Forbes that New Hampshire’s Dartmouth-Hitchcock Medical Center said 2012 would be a year of weak operating performance due to expenses related to Epic.

Former CEO of Beth Israel Deaconess Medical Center Paul Levy has likened the hold that Epic has on its customers to Stockholm syndrome ― the phenomenon that occurs during a hostage situation when victims begin to experience positive feelings toward their captors.

“What is striking about this company is the degree to which the CEO has made it clear that she is not interested in providing the capability for her system to be integrated into other medical record systems,” Levy wrote.

Yet Epic’s ability to communicate internally between more than 150 clinics and UCSF’s emergency department and hospital is exactly why it was chosen, Laret said. UCSF’s first attempt at an electronic health record lacked interoperability.

“While the medical center coordinated efforts to customize the system, departments just didn’t talk to one another; each one had developed its own workflow pattern and way of doing things,” Elise Singer, chief medical officer of the California Health Information Partnership and Services Organization said in a 2011 article.

Laret conceded that Epic’s system was surprisingly underdeveloped, especially considering how many installations the vendor has been responsible for. It’s not self-learning, and it doesn’t improve over time, he said. However, the key for UCSF is that it passes the rigor test. It’s clunky, but it’s sturdy. And importantly, it stands above the rest when it comes to data security.

“This is where so often many find the small vendors just don’t cut it,” Laret said. “You get it in and it just doesn’t hold up in big environments.”

Returning to the panel’s focus on the unmet needs of providers, Laret had more to say. Technology has the potential to fill some gaps in the hospital setting, but UCSF — and likely many other hospitals like it — can’t give much time or thought to a new product if it isn’t immediately evident how it will save the hospital money.

“What we’re looking for is things that are going to stand up in our organization, compliment the workflows that we have, move us ahead, and drive down costs. If you can come in with something that’s neutral on everything, but saves us a ton of money, we’re interested,” Laret said.

But before UCSF tries to implement a brand new product, the hospital wants to see that it has been tried and validated by another large hospital. Medical centers don’t want to be the first to stress test something new because of the financial costs involved and because of the distractions it presents providers with.

This leads to a chicken or the egg problem. If hospital implementation isn’t possible without hospital validation, where do you begin? Epic’s big break came when Meaningful Use put EHRs in high demand. Where will other tech companies find their Meaningful Use-like opportunity?

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