[Senate Hearing 111-157]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 111-157

       INVESTING IN HEALTH IT: A STIMULUS FOR A HEALTHIER AMERICA

=======================================================================

                                HEARING

                                 OF THE

                    COMMITTEE ON HEALTH, EDUCATION,
                          LABOR, AND PENSIONS

                          UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                                   ON

EXAMINING THE INVESTING IN HEALTH INFORMATION TECHNOLOGY (IT), FOCUSING 
                  ON STIMULUS FOR A HEALTHIER AMERICA

                               __________

                            JANUARY 15, 2009

                               __________

 Printed for the use of the Committee on Health, Education, Labor, and 
                                Pensions


  Available via the World Wide Web: http://www.gpoaccess.gov/congress/
                                 senate




                  U.S. GOVERNMENT PRINTING OFFICE
46-710 PDF                WASHINGTON : 2009
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing 
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC 
area (202) 512-1800 Fax: (202) 512-2104  Mail: Stop IDCC, Washington, DC 
20402-0001



          COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS

               EDWARD M. KENNEDY, Massachusetts, Chairman

CHRISTOPHER J. DODD, Connecticut     MICHAEL B. ENZI, Wyoming
TOM HARKIN, Iowa                     JUDD GREGG, New Hampshire
BARBARA A. MIKULSKI, Maryland        LAMAR ALEXANDER, Tennessee
JEFF BINGAMAN, New Mexico            RICHARD BURR, North Carolina
PATTY MURRAY, Washington             JOHNNY ISAKSON, Georgia
JACK REED, Rhode Island              JOHN McCAIN, Arizona
BERNARD SANDERS (I), Vermont         ORRIN G. HATCH, Utah
SHERROD BROWN, Ohio                  LISA MURKOWSKI, Alaska
ROBERT P. CASEY, JR., Pennsylvania   TOM COBURN, M.D., Oklahoma
KAY R. HAGAN, North Carolina         PAT ROBERTS, Kansas
JEFF MERKLEY, Oregon

           J. Michael Myers, Staff Director and Chief Counsel

     Frank Macchiarola, Republican Staff Director and Chief Counsel

                                  (ii)

                            C O N T E N T S

                               __________

                               STATEMENTS

                       THURSDAY, JANUARY 15, 2009

                                                                   Page
Mikulski, Hon. Barbara A., a U.S. Senator from the State of 
  Maryland, opening statement....................................     1
Cochran, Jack, M.D., FACS, Executive Director, The Permanente 
  Federation, Oakland, CA........................................     4
    Prepared statement...........................................     6
Corrigan, Janet, Ph.D., President, The National Quality Forum, 
  Washington, DC.................................................    11
    Prepared statement...........................................    13
Neupert, Peter, Vice President, Microsoft Health Solutions, 
  Redmond, WA....................................................    17
    Prepared statement...........................................    18
Grealy, Mary, President, Healthcare Leadership Council, 
  Washington, DC.................................................    24
    Prepared statement...........................................    25
Melvin, Valerie, Director, Information Technology, The Government 
  Accountability Office (GAO), Washington, DC....................    33
    Prepared statement...........................................    34

                          ADDITIONAL MATERIAL

Statements, articles, publications, letters, etc.:
    Kennedy, Hon. Edward M., a U.S. Senator from the State of 
      Massachusetts..............................................    54
    Enzi, Hon. Michael B., a U.S. Senator from the State of 
      Wyoming....................................................    55
    Murray, Hon. Patty, a U.S. Senator from the State of 
      Washington.................................................    55
    Article--Reinventing Healthcare Through Health Information 
      Technology.................................................    23

                                 (iii)

  

 
       INVESTING IN HEALTH IT: A STIMULUS FOR A HEALTHIER AMERICA

                              ----------                              


                       THURSDAY, JANUARY 15, 2009

                                       U.S. Senate,
       Committee on Health, Education, Labor, and Pensions,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:00 a.m. in 
Room SD-430, Dirksen Senate Office Building, Hon. Barbara A. 
Mikulski, presiding.
    Present: Senators Mikulski and Merkley.

                 Opening Statement of Senator Mikulski

    Senator Mikulski. Good morning, everybody. The Working 
Group on Quality Healthcare will come to order. This is the 
very first hearing that this working group is going to have. We 
are going to begin quite promptly.
    We want to acknowledge that Senator Enzi cannot be here 
because of scheduling conflicts, and also Senator Alexander.
    But today is a wonderful and exciting day in the Senate. We 
will be welcoming a new Senator from Illinois, and we are going 
to be saying good-bye to two very special Senators, Biden and 
Clinton, and they will be getting their farewell speeches.
    So we would like to move expeditiously, but robustly in 
this hearing so that we can, more of us, be done by 11:00 a.m. 
so that we could at least be there for part of the farewells.
    So I am going to move this along, but I think we need to 
move healthcare along. So this is the spirit of the committee.
    First of all, this is a working group established by 
Senator Kennedy on quality. The theme of this working group 
will be called ``Quality Healthcare: The Means for Saving Lives 
and Saving Money.''
    Health reform is absolutely on the national agenda. The 
content will be extremely difficult, but the process is 
something that we can do.
    In the spirit of both our President-elect, Mr. Obama, and 
also the Democratic Party, we want to reach out to our 
Republican colleagues to assure them that the working groups on 
this committee will continue the spirit of bipartisanship that 
has been established by both Senator Kennedy and Senator Enzi.
    They have set the tone. They have set the process, and they 
have actually set the methodology. And we intend to do that.
    It is not the Democratic intent to have a healthcare reform 
bill that will squeak by by a vote or two. We want it to pass, 
if not unanimously, to pass in a robust way. And we think the 
way you do good legislation is to have good manners, and good 
manners starts with a good process.
    We had an excellent model here in the way we worked on 
higher education and some of the others in the last committee. 
Senator Enzi said it well yesterday when he said because of the 
way they worked together, the once most cantankerous committee 
in the Senate is now one of the most productive. That is the 
way we are going to be here.
    Senator Kennedy has established three working groups--one 
on coverage that Senator Bingaman chairs, one on prevention 
that Senator Harkin chairs, and the one on quality that I 
chair. So today is my kickoff in a series of hearings on 
quality. And to use a well-known phrase, ``I am fired up and 
ready to go.''
    When it comes to healthcare, we want to also, in that 
spirit of bipartisanship, let others know that we have reached 
out by making sure we had bipartisan witnesses. We invited 
really the experience and insights of former House Speaker Mr. 
Gingrich and our very beloved colleague Dr. Bill Frist and also 
Senator Snowe because of her quite broad experience in dealing 
with particularly the health IT and the Finance Committee. They 
couldn't come, but we welcome their ongoing advice and input on 
this.
    Our witnesses today, I think, represent a great deal of 
experience and knowledge, and, wow, do we need you. And at the 
same time, we think it represents broad views--Jack Cochran 
from Permanente Federation; Peter Neupert from Microsoft; Janet 
Corrigan from the National Quality Reform; Val Melvin, a sister 
University of Maryland graduate, from GAO; and Mary Grealy of 
the Healthcare Leadership Council.
    The purpose today is to talk about health IT, and everybody 
sees it as a silver bullet. Well, we believe it is one of the 
major tools and that we cannot do healthcare reform without it. 
It is also being discussed in the stimulus. So we want to get 
the best views and the best thinking.
    We know that under the Wired Act of the previous Congress, 
a lot of thinking is already going on, and we are going to add 
to that. What we want is, No. 1, health information technology 
to be patient centered and patient secure. We want it to be 
interoperable. Because if it is not interoperable, it is not 
going to function.
    We don't want another techno boondoggle. As someone who 
appropriates for the Commerce, Justice, and Science Committee, 
I am really familiar with a lot of things that we did on 
interoperability. The CJS bill had the terrible problem with 
the FBI when we wanted interoperable case files and field 
offices, and we ended up spending over $1 billion, and it 
wasn't worth a warm spit.
    Well, you get where I am heading here. So we don't want 
techno boondoggles. We want techno opportunity. And most of 
all, it has got to be user-friendly so that it will be adopted 
particularly in clinical practice, where there is wonderful 
onesie, twosie doctors out there, particularly often in our 
rural communities. So we have got a lot to listen to.
    Over the years, every major group from IOM to others have 
talked about why we need health IT. Every industrial Nation has 
it. Germany, UK, Australia lead the way. Our survey showed that 
only 4 percent of physicians have electronic health records. 
Very few have access to it, and what we do have is certainly 
not even beginning interoperable.
    And it might very well be that even within an acute care 
facility, surgery might have one, but maybe that is orthopedic 
surgery. But they are not linked to cardiology or with the 
diabetes. And for many of our patients, they come in with more 
than one thing going on in their lives.
    So we have got a lot to listen to. We think there is 
tremendous potential in this--quality improvements, 
efficiencies in medical utilization, economic savings. Just 
think of the idea of preventing costly medical errors by 50 to 
90 percent and also particularly avoidable medication errors.
    Helping doctors with clinical decision support systems, 
reminding them when they are going to schedule a test, and 
hoping to see if there is patient compliance in following up. 
To that diabetic, gosh, let us make sure and ask did they 
really go to the ophthalmologist? Gee whiz, the record shows 
you didn't, and we talked about it 3 months ago.
    Efficiencies could mean cutting the cost of delivering 
care, duplicated or inappropriate diagnostic tests, reducing 
paperwork, promoting the appropriate use of prescription drugs, 
actually even being able to read prescriptions. Wow.
    However, the potential of health information technology is 
easier predicted than achieved. Our challenge is to develop it, 
fund it, and promote its use and always keep it fresh and 
contemporary.
    We have got a lot to talk about today. So instead of 
listening to myself talk, I want to listen to you. So I am 
going to just bring to the committee's attention this 
outstanding panel, and I really want to welcome you with 
enthusiasm for being here.
    I am going to do all of the introductions now. And then we 
are just going to start with Mr. Cochran and go all the way 
down, and Ms. Grealy, you are going to be the wrap-up hitter, 
OK?
    We are going to welcome Dr. Jack Cochran, who is the 
executive director of Permanente Federation. I have been 
reading your ads, and I have been reading about you. We really 
understand that you have extensive experience in health IT, and 
your executive experience and actually this hands-on practical, 
how does it go in clinical practices. All of the pluses, and we 
want to hear the minuses.
    Janet Corrigan, you are the CEO of the National Quality 
Forum and a board member of IOM. We know that you have written 
a number of IOM reports, and you have shaped the thinking of 
Congress to improve healthcare quality. We want to know how we 
can use this to improve the delivery of healthcare. And really, 
you have seen a lot of it now.
    Mr. Neupert, you bring the private sector experience from 
Microsoft. We know that we can't develop this system in-house. 
This is not a system that is going to be developed inside of 
HHS. We know that inside HHS and working with other appropriate 
Government agencies like NIST, we are going to establish the 
national standards.
    But we are going to count on the private sector to help us 
achieve this. So we need to hear your ideas on not only the 
technology, but how the technology can continue to be 
modernized as we go along.
    This isn't like building an airfield, where much is made 
about the super information highway. You know, when you build 
I-95, you don't have to build a new I-95 every 6 weeks or every 
6 months or every 6 years. We have got to do potholes and speed 
bumps. But one of our questions is after they build it and we 
have got them to come, how do we keep them coming and make it 
worthwhile? And who is going to pay for it?
    Ms. Grealy, you come from the Health Leadership Council, 
which represents a wide range of business healthcare interests. 
We want you at the table. We know that you have tremendous 
insight in what needs to be developed, but I think you bring 
both the concept of operationality, functionality, but also 
cost, cost, cost.
    Not only who is going to pay for it, but who is going to 
keep on paying for it? Because sustainability and continuing to 
modernize is going to be one of the issues.
    Then, of course, we are going to turn to Valerie Melvin, 
the director of IT at GAO, a graduate, as I said, of the 
University of Maryland. She has received many awards and has 
looked extensively at the standard-setting process, and this 
gives me heartburn.
    You don't give me heartburn, but--
    [Laughter.]
    Senator Mikulski [continuing]. But really, we know the VA 
development. I am really proud of the VA facility in Maryland 
that pioneered this. But you have seen a lot, and we really 
need to discuss the standards.
    Having said that, we are just going to get right to the 
testimony. Actually, you know, Ms. Melvin, I think I am going 
to wind up with you because you are the standards lady, and I 
think it will be very useful after we listen to this content-
rich discussion that we wrap up with you with really--well, you 
know, a lot was said about Joe the plumber, but we are going to 
talk about Ms. Melvin, the interoperable lady here.
    You are going to help us with, really, setting the 
standards and so on. So I will stop.
    Mr. Cochran, let us start with really something working in 
the real world and what we need to know about your extensive 
experience at Kaiser, one of the true flagships in the 
delivering of healthcare.

STATEMENT OF JACK COCHRAN, M.D., FACS, EXECUTIVE DIRECTOR, THE 
               PERMANENTE FEDERATION, OAKLAND, CA

    Dr. Cochran. How am I doing?
    Senator Mikulski. You are doing great.
    Dr. Cochran. I get 6 seconds back. I am Dr. Jack Cochran, 
the executive director of the Permanente Federation, which is 
the national umbrella organization for the eight regional 
Permanente medical groups, which employ more than 14,000 
physicians who care for 8.7 million members of Kaiser 
Permanente. I appear today on behalf of the National Kaiser 
Permanente Medical Care Program, the Nation's largest 
integrated delivery system.
    As Congress considers ways to stimulate the economy, it 
should explore investing in the Nation's healthcare delivery 
system. I am delighted to be here to discuss how promoting the 
effective use of information technologies can improve 
healthcare quality and efficiency and literally save lives.
    In 2003, Kaiser Permanente began the KP HealthConnect 
Project. KP HealthConnect is a comprehensive health information 
system that includes one of the most advanced electronic health 
records available.
    Today, KP HealthConnect securely connects 8.7 million 
people to their physicians, their healthcare teams, their 
personal health information, and the latest medical knowledge. 
With the support of a shared clinical record, we have 
experienced tremendous breakthroughs in coordination of care, 
patient safety, and clinical quality.
    Some key lessons we have learned about implementing and 
gaining value from an HIT system are, No. 1, implementing 
health information technology in a clinical setting is 
disruptive. You should expect a reduction in productivity for 
the first few months and should not expect immediate cost 
savings.
    You have to go slow to go fast in many ways because the 
initial stages of implementation must be well thought out. 
Patience and persistence is key, and physician leadership is 
critical.
    No. 2, implementing the technology is a first step. A much 
more crucial evidence is figuring out how to translate the data 
collected in the system into useful information and delivering 
value. It is not just about digitizing the visit. It is about 
using the data from that visit and other sources to inform and, 
ultimately, transform care delivery. And once again, physician 
leadership is essential.
    Physician input can lead to the creation of tools that 
organize the data into clinical decision support tools, disease 
registries, and other applications that help caregivers more 
effectively care for their patients. HIT can help facilitate 
processes like medication reconciliation at critical 
transitions of care, such as from the hospital to the home.
    And one of the greatest lessons, No. 3, that we have 
learned is how much patients value using online tools to 
interact with us and manage their health. Our personal health 
record, My Health Manager, has more than 2 million active users 
who are taking advantage of such robust features as securely e-
mailing their doctors, accessing lab tests, scheduling 
appointments, refilling prescriptions.
    Having patients involved in their care in this way results 
in more engaged patients, ultimately better care, especially 
for those with chronic conditions.
    So, as you consider the economic stimulus package, Congress 
should be clear about what returns it wants on its investment. 
Rather than rewarding providers for simply purchase or 
implementation of IT, dollars should be tied to actual usage 
and the value derived in terms of process improvements and 
health outcomes.
    Incentives must be focused not simply on ensuring that a 
physician office has implemented an EHR, but incorporating a 
requirement that these systems are interoperable using 
federally sanctioned standards. And while not perfect, our 
experience has been that these standards are available now.
    Finally, done well, we believe an electronic care support 
system can help to restore and enhance the physician's healing 
mission. Maximizing access to information for the clinician 
means optimizing care for the patient.
    The right systems provide more time with patients, better 
information about care, and less time with traditional 
paperwork. The right system also needs to be focused on the 
patient's needs for affordable, well-informed, customized, and 
compassionate care, and we believe that health IT is needed to 
support our Nation's healthcare reform agenda and help our 
Nation fulfill its ethical responsibility to improve healthcare 
access, reduce costs, and ensure quality of care for all.
    Thank you.
    [The prepared statement of Dr. Cochran follows:]
           Prepared Statement of John H. Cochran, M.D., FACS
    Senator Mikulski and Senator Enzi and other distinguished members 
of the committee, thank you for the invitation to be here today. I am 
Dr. Jack Cochran, the Executive Director of The Permanente Federation, 
the national umbrella organization for the regional Permanente Medical 
Groups. The Permanente Medical Groups employ more than 14,000 
physicians, who care for approximately 8.7 million Kaiser Permanente 
members. I appear today on behalf of the national Kaiser Permanente 
Medical Care Program, the Nation's largest integrated health care 
delivery system.
              the promise of health information technology
    As Congress considers ways to stimulate the economy, it should 
explore investing in the Nation's health care delivery system. I am 
delighted to be here to discuss how promoting the effective use of 
health information technologies can improve health care quality, 
efficiency, and literally save lives.
    Medicine is far behind other industries in adopting and leveraging 
information technologies. While other industries have been quick to 
automate, the health care industry has often been slow to adopt.
    Individual medical records, medication lists, along with the latest 
medical research and up-to-date information on applicable clinical 
trials must be available for clinicians and patients at the click of a 
mouse. Under appropriate patient confidentiality safeguards, secure 
electronic health records (EHRs) should allow various health care 
providers across vast geographic spans to collaborate and coordinate 
care for their patients based on current, comprehensive clinical 
information. The economic stimulus package should promote the 
development of effective, interoperable clinical information systems 
and the skills to use them.
    But it is important to link these improvements in processes with 
systemic changes in financial incentives to continually advance the 
effectiveness and reliability of health care delivery. As you know, our 
Nation's health care delivery system is fragmented, disorganized, and 
hampered by ineffective and perverse incentives for quality and 
efficiency. Health information technology (HIT) is one critical tool 
that can help move our system toward a highly functioning, organized, 
patient-centered one. However, it is important that these investments 
be strategic and worthwhile. As one wise policymaker quipped, ``making 
the wrong investments in HIT could simply result in doing the wrong 
things faster.''
                           kaiser permanente
    When she invited me to speak today, Senator Mikulski asked me to 
share some of the lessons we've learned in developing what we believe 
is the world's largest civilian deployment of an EHR. As Senator 
Mikulski knows, we are proud to serve members in the State of Maryland. 
We also provide health care to nearly nine million individuals in eight 
other States including California, Oregon, Colorado, Georgia, Hawaii, 
Ohio, Virginia, Washington, and the District of Columbia.
    At Kaiser Permanente, we have found strength and opportunity 
through the fundamental and often unique partnerships within our 
organization: the physician and patient relationship; the collaboration 
between labor and management; the linkage of clinical research to 
improved care delivery; our investments and involvement in the 
communities we serve; and the shared coordination of care across 
inpatient, outpatient, ancillary services, and all the settings of care 
delivery.
    In 2003, Kaiser Permanente began the KP HealthConnectTM project. KP 
HealthConnect is a comprehensive health information system that 
includes one of the most advanced electronic health records available. 
Our success with this endeavor is the result of decades of work 
developing health records and training physicians and staff to use 
them. This experience spanned most of our operating regions. For 
example, the Colorado region, where I practiced, had a complete 
electronic health record beginning in 1997.
    Today, KP HealthConnect securely connects 8.7 million people to 
their physicians, their health care teams, their personal health 
information, and the latest medical knowledge, leveraging the 
integrated approaches to health care available at Kaiser Permanente.
    Kaiser Permanente has made a huge investment in HIT, both 
financially and philosophically. We believe it has the power to 
transform the way we deliver health care and improve patient health.
                physician adoption and acceptance of hit
    In April 2008, we completed implementation of KP HealthConnect in 
every one of our 421 medical office buildings, ensuring that our 14,000 
physicians and all other ambulatory caregivers have appropriate 
electronic access to their patient's clinical information. In addition, 
we have completed the deployment of inpatient billing; admission, 
discharge, and transfer; and scheduling and pharmacy applications in 
each of our 32 hospitals. Now, we are in the midst of an aggressive 
installation schedule for bedside documentation and computerized 
physician order entry (CPOE). As of the end of 2008, we had 25 of our 
32 hospitals fully deployed. (An interesting anecdote: the new 
hospitals we are building in California as a response to the seismic 
upgrade requirements are being built without medical record rooms.)
    Now, you may ask, did this all happen easily? Did our physicians 
and nursing staff immediately embrace our EHR? The simple answer is, 
no. Any major transition like this requires fundamental change in 
workflows. We had to build in time for testing, training, and some 
belly aching too. But if we tried to take KP HealthConnect away from 
any of our doctors and nurses now, a riot would ensue.
    Implementing HIT in a clinical setting is tremendously disruptive. 
You have to expect about a 20 percent reduction in productivity in the 
first 3 to 6 months, and you should not expect immediate cost savings. 
You have to go slow to go fast. Initial stages of implementation must 
be well planned and tested. Patience is key, and physician leadership 
is critical.
    Change can cause apprehension and concern. If not handled properly, 
it can also interfere with the quality of care that is delivered. In an 
outpatient setting, you can build in time for training by scheduling 
patients differently or making sure you do not implement a new IT 
system during flu season, for example. In an inpatient setting, you 
simply do not have the same flexibility, so the challenges are 
different.
    At first, Permanente physicians were reluctant to complete after-
visit summaries as a written acknowledgement of everything that was 
discussed during the visit. These after-visit summaries are stored in 
each patient's EHR. Because patients can access them later, the 
summaries can help remind them about what they and their doctors 
discussed regarding medications, follow-up treatment, etc. Primary care 
providers who give their patients an after-visit summary typically 
score an average of 14 points higher on satisfaction surveys.
    Since the deployment of our integrated medical record, we have 
begun to see major advances in using health information systems as a 
diagnostic tool (for identifying and understanding patients with 
certain risk factors) as well as for appropriate therapeutic 
intervention (for encouraging adherence and for intensification or 
moderation of therapy when needed).
    The EHR has allowed our physicians to be more efficient by giving 
them better practice management and communication tools that help them 
reduce unnecessary visits and phone calls. Today, our doctors don't 
ask, ``How many patients can I see? '' but rather, ``How many problems 
can I solve? '' Data gathered in three of our regions (Colorado, 
Hawaii, and the Northwest) demonstrate how implementing an EHR lowers 
both primary and specialty care office visit rates by enabling the 
clinician to resolve certain issues for patients with fewer face-to-
face contacts. For example, a simple response to an e-mail may be all 
that a patient needs from his or her doctor. Because our system allows 
our physicians to view appropriate medical information online, patients 
and physicians can interact with each other when it's most convenient 
for both of them.
                 patient acceptance and adoption of hit
    One of our greatest lessons has been how much KP members value the 
ability to use online tools to manage their health. Launched in 2005, 
our personal health record, My Health Manager, now has more than 2 
million active users. This represents the largest user base of online 
personal health records (PHRs) in the United States. Using direct links 
to actual clinical and operational systems, we are able to provide our 
members with access to robust features, including access to lab test 
results, appointment scheduling, prescription refills, and even the 
ability to securely e-mail their doctors. To date, our members have 
viewed over 56 million lab test results online, sent over 5 million 
secure e-mail messages, made over 2 million online visits to book and 
review future appointments, and logged over 1 million online visits to 
view past office visit information.
    With secure e-mail messaging, patients can communicate with their 
doctors at any time, from anywhere. Demonstrating the growing consumer 
interest in e-visits, our patients send more than 300,000 secure e-mail 
messages each month to their doctors and care teams. The average 
doctor's visit takes 3 hours out of an individual's day, so members 
value the ability to use My Health Manager on kp.org to handle routine 
health care needs, including refilling their prescriptions, which can 
be delivered directly to their home or a pharmacy. Results from a study 
published in the American Journal of Managed Care showed an 8 percent 
reduction in office visits and a 14 percent reduction in phone calls 
among My Health Manager users.\1\ The study also confirmed that secure 
messaging is used primarily for non-urgent issues; nearly two-thirds 
were coded as ``brief '' or lower.
---------------------------------------------------------------------------
    \1\ Zhou YY, Garrido T, Chin H, Wiesenthal A, Liang L, ``Patient 
Access to an Electronic Health Record with Secure Messaging: Impact on 
Primary Care Utilization,'' American Journal of Managed Care. July 
2007; 13: 418-424.
---------------------------------------------------------------------------
                   transforming health care delivery
    While we have documented some specific dollar savings, our greatest 
benefits are improvements in clinical and service quality. With 24/7 
access to comprehensive health information, our care teams are able to 
coordinate care at every point of service--physician's office, 
laboratory, pharmacy, hospital, on the phone, and even online. Unlike 
the paper chart locked in a physician's office, an EHR can be shared 
among all physicians caring for a patient. For example, when a patient 
comes into the Emergency Department at 2 am: (1) there will be no 
duplication of effort to collect data that already exists; (2) the 
insights of one physician are more easily available to others; and (3) 
care can be better coordinated. Our early results demonstrate what 
Crossing the Quality Chasm predicted: HIT helps to make care safer, 
more effective, patient-centered, timely, efficient, and equitable.
    Through our experience with KP HealthConnect, we have found that 
implementing the technology was just the first step. A far more crucial 
endeavor is determining how to translate the data collected within the 
system into useful information that will deliver value. It's not just 
about digitizing the visit--it's about using the data from that visit 
and other sources to inform and ultimately to transform care delivery.
    For example, our use of HIT and our comprehensive approach 
(partnership of primary care providers, cardiologists, nurses, and 
pharmacists with accountability across the continuum of care--
preventive, chronic, and acute) have significantly reduced emergency 
department visits and mortality. In Colorado, we have seen a 76 percent 
reduction in cardiac mortality for those who participated in our 
Collaborative Cardiac Care Service compared with those who received 
regular treatment.\2\ Based on NCQA data, as compared to the national 
HMO average, we prevent more than 280 cardiac events annually in 
Colorado. This improvement saves $2 million in annual hospital costs. 
In northern California, if you are a member of Kaiser Permanente, you 
have a 30 percent less chance of dying of heart failure compared to a 
member of the general population. In Oregon and Washington, by using KP 
HealthConnect in a new Regional Telephonic Medicine Center staffed with 
emergency room physicians and advice nurses, we have achieved an 11 
percent reduction in the number of members who need to visit the 
emergency room between the hours of 12 noon and 10 p.m. In southern 
California, from 2004 to 2007, combining the power of our IT systems 
and our integrated delivery model, we were able to increase mammography 
screening rates for women aged 50-69 from 80 percent to nearly 90 
percent.
---------------------------------------------------------------------------
    \2\ Sandhoff, B., Kuca, S., Rasmussen, J., Merenich, J., 
``Collaborative Cardiac Care Service: A Multidisciplinary Approach to 
Caring for Patients with Coronary Artery Disease,'' The Permanente 
Journal. Summer 2008, 12:3; 4-11.
---------------------------------------------------------------------------
    This last example was highlighted for me by a recent letter that 
puts a human face on these statistics:

          Early last year, I came to your facility to have a foreign 
        body removed from my eye. I visited your Ophthalmology 
        Department, and your competent staff dealt with this minor 
        emergency.
          What made this visit so meaningful was my interaction with 
        your nurse after my visit with the doctor. In addition to 
        giving me some after-visit instructions, she noticed in the 
        computer that I needed a mammography exam. I had been reminded 
        before, but I tend to be too busy to take care of my own 
        health. This time the nurse was very insistent. She even made 
        me an appointment so I could walk in and get an exam within the 
        hour. Since I did not have to wait too long, I had an exam done 
        that day. Well, they found a mass in my right breast, and it 
        was cancer. I have gone through chemotherapy and radiotherapy, 
        and today I am cancer free.
          I am convinced that I am alive today because of your 
        organization's focus on my total health. My interaction with 
        your entire health care system has been nothing but positive. I 
        am especially appreciative to the young nurse who took the time 
        to convince a stubborn old lady to take responsibility for my 
        health.
          Thank you for giving me many more years to thrive.

    This letter describes a simple act by one of our nurses that was 
possible only because the nurse had access to that patient's 
information, acted on it, and was part of an integrated health care 
system that encourages this series of events.
    KP HealthConnect also allows us to share content across all 
regional facilities, providing the best technical platform to 
disseminate drug formulary changes, best-practice alerts, and automated 
clinical guidelines to the entire enterprise. Our members can move 
through any facility within a given region, and their clinical and 
administrative information will follow them.
    As an example, during the 2007 wildfires in San Diego, when Kaiser 
Permanente facilities within the fire lines closed, we contacted 
members and directed them to open facilities. When our members arrived 
at these new facilities, their new care teams had appropriate access to 
their records via KP HealthConnect, ensuring continuity of care in a 
time of crisis.
    When we started down this path, Kaiser Permanente faced many of the 
same barriers that other health care organizations and providers face 
today when they start to utilize HIT to improve care delivery. These 
barriers involve both process (e.g., complexity of health care is 
increasing, workflows will be disrupted, end-to-end patient-centered 
view is not well known) and technology (e.g., data is ``locked away'' 
in various paper files, applications, and databases; data standards, 
interoperability standards, usability standards must be integrated). I 
am here to tell you that these issues can be overcome.
    Kaiser Permanente and other multi-specialty groups like Group 
Health Cooperative, Intermountain Healthcare, and Geisinger can set the 
gold standard with a sophisticated EHR and integrated care delivery 
systems. Harder to overcome are the misaligned incentives in systems 
that are not vertically integrated, because these do not encourage 
providers to re-design care delivery to incorporate evidence-based care 
processes for improving quality and effectiveness. As a nation, we can 
decide to create payment incentives that reward health professionals 
who share information, who learn from each other, and who hold 
themselves and one another accountable in order to generate the best 
health outcome at the most reasonable cost for each patient.
                      an interoperable hit system
    Congress has the ability to create a system that is truly 
interoperable. Today, far too often, our systems speak different 
languages. Even when electronic information exists for patients, 
critical clinical information can be lost during an emergency or when 
patients transfer from one system to another because the different 
systems simply cannot communicate with one another.
    After discussing interoperability of medical records for years, 
Kaiser Permanente recently demonstrated successful data exchange of 
health records involving our shared patient population with the 
Veterans' Administration. This demonstration project uses test data for 
fictitious patients, but it also shows that privacy and security 
requirements will work to protect real patient data. The demonstration 
uses the national interoperability standards recognized by the 
Department of Health and Human Services (HHS), proving they work in the 
real world.
    Sound HIT policy should stress the critical importance of 
standards-based interoperability to achieve coordinated patient-
centered health care. The ability of separate HIT systems to 
interconnect with each other depends on uniform adherence to strictly 
defined standards. Most of these standards exist today. Kaiser 
Permanente supports the HHS-adopted interoperability standards selected 
by the Healthcare Information Technology Standards (HITSP) and used in 
the National Health Information Network (NHIN).
    Only when these existing technical standards are used consistently 
across the delivery system will HIT be able to achieve its promise for 
both direct care of individual patients and for population-based care.
    Connected HIT will not be adopted by most clinicians and 
institutional providers without mandates or a system of incentives and 
penalties that are materially more advantageous or costly to providers 
than those outlined in current and previous proposals. For instance, 
one approach could use Medicare conditions of participation (COP) as a 
means to promote adoption, with metrics for adoption of HIT, determined 
by the Secretary and used by HHS as benchmarks. Achieving benchmark 
measures for HIT could trigger loan forgiveness or incentive payments.
    Above all, dollars should be attached to outcomes. For example, 
organizations that receive HIT incentives could be required to adhere 
to certain clinical care pathways or demonstrate that they have 
``functional EHRs.'' This may mean that their EHR must show it is 
capable of sending and receiving lab, pharmaceutical, and other 
clinical information--not just payment claims information.
    HIT system functions and interoperability are essential 
cornerstones for policies such as primary care-centered medical homes, 
coordination of care for chronic conditions, value-based care, 
comparative effectiveness research, and pay-for-performance/pay-for-
quality initiatives. Some EHR-systems come as ``blank slates,'' with 
functionality, but without built-in clinical content or knowledge; 
these systems demand tremendous amounts of time, skill, and energy to 
harness the tools to the purpose of actually improving quality. Linking 
the implementation of HIT to health system reforms is essential. To 
promote appropriate and clinically effective uses of HIT over the mere 
acquisition of technology, the Secretary of HHS should develop and 
implement measures for HIT connectivity and data exchange as well as 
measures for EHR-based quality reporting.
                                privacy
    All consumers should be able to rely on appropriate and consistent 
minimum levels for privacy and security protections among all 
entities--both public and private--that access or use individual health 
information. A high level of trust in these protections is crucial for 
HIT to succeed. It will be important for Congress to strike an 
appropriate balance between the competing interests of protecting 
privacy concerns versus advancing HIT, EHRs, and public health 
initiatives. Both can be achieved. Today, many State laws risk slowing 
down the rate of progress by allowing consumers to opt out of disease 
registries and other community health initiatives due to privacy 
concerns.
    We believe that HIPAA should remain the basis of new privacy rules. 
However, privacy policy also must cover personal health data 
consistently, regardless of what entity holds the records. Privacy 
requirements can achieve better protection for consumers without adding 
to the cost of HIT, changing the practice of medicine, or creating 
medical liability issues.
    There are good models in State law for guarding against security 
breaches in ways that do not impede access to health information by 
clinicians; it is important to remember that the lack of appropriate 
and complete health information for clinicians who are treating a 
patient can also endanger that patient's life.
    In our experience, California law provides a model for breach 
notification that is clear and consistent across all types of entities, 
events, and circumstances. We believe HIPAA disclosure accounting for 
treatment, payment, or health care operations purposes would add a 
significant amount to the total cost of HIT implementation and could 
harm the practice of medicine by disrupting clinical workflows. HIT 
innovators should not be penalized by regulations that force 
unnecessary or disproportionate system overhauls to achieve compliance, 
especially when such modifications will consume resources that could be 
spent to deliver high quality care. Efficiency should be a goal of new 
investments and rules.
               improving safety, quality, and efficiency
    The real objective of HIT in the economic stimulus package should 
not be technology, but rather to improve safety, quality, and 
efficiency.
    At Kaiser Permanente, we believe the keys to the solution will be 
health care led by clinicians, integrated with functional IT systems, 
and staffed with innovative, enthusiastic, computer-enabled health care 
professionals.
    Having HIT and the means to exchange information will do us little 
good if we do not foster and support better information about the 
effectiveness of care, including the relative benefits, risks, and 
costs of treatments and services. We need a robust Federal commitment 
to comparative effectiveness research so that health professionals can 
ensure that each individual patient gets the care that is right for him 
or her. Reforms must also ensure that patient information can be used 
not only to optimize care for one specific patient but also to improve 
care for all patients through, for example, the development of clinical 
care guidelines and disease management protocols. These goals require 
the use of patient information and appropriate access to patient 
records, with privacy safeguards as currently required under HIPAA 
rules.
    Ultimately, however, to effect real change, provider payment 
systems should be based on value rather than the number of procedures, 
drugs, tests one orders--regardless of whether the best evidence calls 
for such action. To keep coverage affordable and to really fix our 
broken health care system, we must change the way we deliver and pay 
for health care. Financial incentives must be changed so that plans 
compete on quality and efficiency, providers are rewarded for quality 
and keeping their patients healthy rather than for the volume of 
services delivered, and individuals are encouraged to seek high-quality 
care and to be more actively involved in maintaining their own health.
    We believe a computerized care support system that is well-designed 
and implemented appropriately can help restore and enhance the 
physician's healing mission. Maximizing information available to the 
clinician means optimizing care for the patient. The right systems will 
yield more time with patients, better information about care, and less 
time with traditional paperwork. The right systems also must focus on 
the patient's need for affordable, well-informed, customized, and 
compassionate care. We believe a new HIT system will support our 
Nation's health care reform agenda and can help our Nation fulfill its 
ethical responsibility to improve health care access, reduce costs, and 
ensure quality care for all.
    We look forward to working with you to achieve these goals.

    Senator Mikulski. Well, you have covered a lot of ground. 
And just looking at your testimony; we could just spend all 
morning in a dialogue with you, and we will be coming back. 
Thank you. And thank you for being within the time limit.
    Ms. Corrigan.

  STATEMENT OF JANET CORRIGAN, PH.D., PRESIDENT, THE NATIONAL 
                 QUALITY FORUM, WASHINGTON, DC

    Ms. Corrigan. Chairwoman Mikulski and members of the 
committee, thank you for inviting me here today to talk about 
health information technology and quality.
    My name is Janet Corrigan. I am the president and CEO of 
the National Quality Forum. NQF is a private sector standard-
setting organization whose mission is to improve the quality of 
American healthcare by setting national priorities and goals 
for performance improvement and endorsing standardized 
performance measures that can be used to assess, publicly 
report, and, most important, improve performance on the front 
line.
    A standardized performance measurement and reporting system 
is a core building block for creating a higher quality, more 
affordable healthcare system, and it is necessary to 
successfully implement virtually all reform strategies, 
including changes in payment policies, public reporting, and 
regulatory oversight. Investing in health information 
technology is critical to that standardized measurement and 
reporting system.
    I commend the committee for focusing attention on how HIT 
investments can achieve maximum benefit, both for our economy 
and the quality of care our patients receive. You have probably 
heard it said that a crisis is a terrible thing to waste. And 
as unfortunate as they are, crises provide a prime opportunity 
to force clear thinking and prioritization of our actions and 
investments.
    In my comments today, I am going to focus on the linkage 
between HIT investments and improvements in patient care. More 
specifically, I will cover three points. First, Federal funding 
to promote adoption of HIT is an essential foundation for 
improving safety, quality, and affordability, and we should 
make substantial investment now.
    Second, investments in HIT will result in far greater 
improvement in patient care if steps are taken to ensure that 
electronic health records and personal health records possess 
the necessary capabilities to support performance measurement, 
reporting, and improvement.
    And third, HIT investments and incentives should be tied to 
the effective use of HIT to improve safety, outcomes, and the 
experience of care, not just having the technology in place.
    We are making progress in improving healthcare performance, 
but it is happening at a slower pace than it should. There are 
many examples of efforts to improve quality in virtually all 
types of settings that are substantial and lifesaving. But our 
healthcare system lacks the ability to bring these innovations 
to scale.
    One of the reasons for this slow rate of improvement is 
that our current healthcare delivery system is extraordinarily 
fragmented. HIT can facilitate the exchange of patient 
information and communication between providers and across 
settings.
    Much of the healthcare sector lacks critical organizational 
supports that are needed to manage patients across their entire 
episode of illness. I want to emphasize that HIT alone is not 
enough to transform the delivery system. HIT is a tool. It must 
be used effectively.
    Investments in HIT will have the greatest impact if pursued 
within a broader policy agenda that encourages the development 
of higher levels of organizational capacity in all practice 
settings.
    The second point I want to make is that for investments in 
HIT to have the greatest impact, EHRs and PHRs must be capable 
of capturing the necessary data to calculate measures and to 
provide clinical decision support to providers to enhance 
performance. Efforts are now well underway to create a bridge 
between the quality community and the HIT community.
    In 2007, with initial support from AHRQ, NQF established 
the Health Information Technology Expert Panel. The initial 
work of HITEP has focused on identifying types of data that 
must be captured in EHRs to calculate performance measures that 
are currently used by Medicare for public reporting purposes.
    HITEP works closely and collaboratively with the Health 
Information Technology Standards Panel that translates the 
quality dataset into HIT standards and with the Certification 
Commission for Health Information Technology to promote the 
development of EHRs capable of supporting performance 
measurement and improvement. I encourage you to build on this 
important collaborative work and not to reinvent the wheel.
    My third and last point is that Federal funding to promote 
the adoption of HIT will only result in improvements in care if 
HIT systems are effectively used to perform key value-enhancing 
functions, including the exchange of data on prescriptions, 
laboratory tests, and imaging procedures, and developing 
evidence on the safety and effectiveness of the treatments.
    Interoperability and technical capabilities are important, 
but not enough. Investments should be tied to changes in care 
delivery that translate into real improvements in patient 
safety and clinical outcomes.
    To support that need, NQF has endorsed a set of performance 
measures emphasizing HIT in five areas and its use--in 
electronic prescribing, interoperability, care management, 
quality registries, and the medical home.
    In conclusion, NQF supports Federal funding to promote 
adoption of HIT as an essential foundation for improving 
safety, quality, and affordability. But it is important to 
invest wisely. The investment will yield far greater returns in 
terms of higher quality, more affordable care if EHRs and PHRs 
are built with the necessary capabilities to support 
performance measurement and improvement and if investments are 
tied to the effective use of HIT to enhance patient care.
    Thank you very much.
    [The prepared statement of Ms. Corrigan follows:]
              Prepared Statement of Janet Corrigan, Ph.D.
    Chairman Kennedy, Chairwoman Mikulski, Ranking Member Enzi and 
members of this committee, thank you for inviting me here today to talk 
about Health Information Technology (HIT) in the stimulus package, and 
its potential to help us move toward making higher-performing, lower-
cost healthcare available to every American.
    My name is Janet Corrigan. I am the President and CEO of the 
National Quality Forum. NQF is a private sector standard-setting 
organization with more than 375 members representing virtually every 
sector of the health care system. NQF operates under a three-part 
mission to improve the quality of American health care by:

     setting national priorities and goals for performance 
improvement;
     endorsing national consensus standards for measuring and 
publicly reporting on performance; and
     promoting the attainment of national goals through 
education and outreach programs.

    NQF endorsement, which involves rigorous, evidence-based review and 
a formal Consensus Development Process, has become the ``gold 
standard'' for health care performance measures. Major health care 
purchasers, including the Centers for Medicare & Medicaid Services, 
rely on NQF-endorsed measures to ensure that the measures are 
scientifically sound, relevant and help standardize and raise the bar 
for performance across the industry. To date, NQF has endorsed more 
than 500 measures. A standardized performance measurement and reporting 
system is a core building block for creating a higher quality, more 
affordable health care system, and is necessary to successfully 
implement virtually all reform strategies. Investing in health 
information technology is critical to routinely assessing performance.
    I commend the committee for focusing needed attention on how HIT 
investments can achieve maximum benefit--both for our economy and the 
quality of care our patients receive. You've probably heard it said 
that a crisis is a terrible thing to waste. Crises provide a prime 
opportunity to force clearer thinking and prioritization of our actions 
and investments. I believe this to be true of the current economic 
crisis and Congress and the Administration's efforts to address it, 
particularly when it comes to healthcare.
    Healthcare spending and our economy are inextricably linked. We can 
no longer sustain healthcare spending at a rate that will reach more 
than 20 percent of the GDP by 2020. After a stock market freefall in 
2008, the Nation's financial condition dropped to what is considered 
the worst economy in 70 years. Experts now agree that we have not yet 
hit bottom and that 2009 may bring the worst conditions faced in 
generations. We cannot continue to act as we always have. We can no 
longer afford the health care system we have, particularly considering 
that 30 percent of spending is wasteful--$600-$700 billion spent on 
care that is often unnecessary and even harmful care. HIT is not just a 
good idea, not just an innovation--HIT is essential if we hope to 
achieve the goals we have set to achieve higher quality, affordable 
care that fuels rather than drains our economy.
    In my comments today, I am going to focus on the importance of 
strengthening the linkage between HIT investments and improvements in 
patient care. More specifically, I intend to cover three points. First, 
Federal funding to promote adoption of HIT is an essential foundation 
for improving health care safety, quality and affordability. Second, 
investments in HIT will result in far greater improvement in patient 
care if steps are taken to ensure that electronic health records (EHRs) 
and personal health records (PHRs) possess the necessary capabilities 
to support performance measurement, reporting, and improvement. Third, 
HIT investments and incentives should be tied to the effective use of 
HIT to improve patient safety, outcomes and experience of care, not 
just having it.
                    hit's role in improving quality
    We are making progress in improving healthcare performance, but it 
is happening at a slower pace than it should. For example, the National 
Health Care Quality Report shows an average annual improvement of only 
1.9 percent on a selected set of performance measures between 2000 and 
2004. By contrast, the rate of healthcare expenditures grew 7.6 percent 
during the same time period. There is entrenched over-use, mis-use and 
under-use of services. These gaps in quality, use and access affect 
everyone, but place the greatest burden on minorities. Efforts to close 
the disparities gap have to date had little impact.
    There are many examples of efforts to improve quality in hospitals, 
small and large ambulatory practices, and long-term care settings that 
have been substantial and life-saving. But the health care sector lacks 
the ability to bring these innovations to scale; best practices in care 
delivery may take years if not decades to spread throughout a community 
and the Nation.
    One reason for this slow rate of improvement is that our current 
health care delivery system is extraordinarily fragmented. The average 
Medicare patient sees two primary care physicians and five specialists 
annually, across a median of four different practices. The 
fragmentation of care is even more pronounced for patients with chronic 
conditions; for example, a Medicare patient with coronary artery 
disease sees three primary care physicians and seven specialists in a 
given year. This kind of fragmentation, particularly for the 
chronically ill, makes it extremely challenging to coordinate care and 
share information in a timely way that is responsive to patients' 
needs. HIT can facilitate the exchange of patient information and 
communication between providers and across care settings, which can 
create safer, more effective and patient-centered care.
    Much of the health care sector lacks critical organizational 
supports necessary to consistently provide effective, safe and 
efficient care across the entire patient-
focused episode. HIT is one of those critical organizational supports, 
but I want to emphasize that HIT is not enough on its own to transform 
the delivery system. HIT is a tool that must be used effectively. In 
its landmark report, Crossing the Quality Chasm, the Institute of 
Medicine emphasized the importance of using HIT to:

     Design care processes based on best practices.
     Translate new clinical knowledge and skills into practice.
     Support the work of multi-disciplinary teams.
     Enable the coordination of care across patient conditions, 
services and settings.
     Measure and improve performance.

    Investments in HIT will have the greatest impact if pursued within 
a broader policy agenda that encourages the development of higher 
levels of organizational capacity in all practice settings.
    Investment in HIT now will also enable more effective 
implementation of other elements of a comprehensive reform agenda over 
the coming years including: availability of information on the 
effectiveness of alternative treatments; reform of payment programs to 
promote value; and informed patient choice and shared decision-making. 
Virtually all of these strategies will require more comprehensive 
performance information than is currently available--performance 
information on the entire patient-focused episode including measures of 
patient outcomes, care processes, and resource use.
       hit that supports performance measurement and improvement
    Funds for HIT included in the stimulus provide an opportunity to 
take important steps towards the establishment of a secure, 
interoperable, nationwide health information network. With strong 
leadership from the Office of the National Coordinator, working 
collaboratively with a wide variety of stakeholders, a good deal of 
progress has been made in recent years. The current state of the 
technology and standards is adequate to support this investment now.
    At the same time, we should continue our efforts to ensure that 
EHRs and PHRs possess the necessary capabilities to support performance 
measurement, reporting, and improvement. In short, EHRs and PHRs must 
capture the necessary data to calculate measures; and provide clinical 
decision support (CDS) to providers to enhance performance. 
Establishing an HIT infrastructure to fully support performance 
measurement and improvement requires close and ongoing collaboration 
between the ``quality community'' and the ``HIT community.''
    Efforts are now well underway to create such a ``bridge.'' In 2007, 
with initial support from the Agency for Healthcare Research and 
Quality and pursuant to recommendations of America's Health Information 
Community (now a public-private partnership known as the National 
eHealth Collaborative), NQF established the Health Information 
Technology Expert Panel (HITEP), chaired by Paul Tang, M.D., Palo Alto 
Medical Foundation. The initial work of HITEP has focused on 
identifying the types of data that must be captured in EHRs to 
calculate the performance measures that are currently used by Medicare 
for public reporting purposes. HITEP is now working collaboratively 
with the Health Information Technology Standards Panel (HITSP), to 
translate the ``Quality Data Set'' into HIT standards, and the 
Certification Commission for Health Information Technology, to promote 
the development of EHRs capable of supporting performance measurement 
and improvement.
    I encourage you to build upon this important collaborative work and 
not to reinvent the wheel. The ``Quality Data Set'' will support both 
public reporting and enhanced patient care. It will enable both real-
time feedback to clinicians on their performance and clinical decision-
support (i.e. prompts and reminders to a clinician to ask a question or 
supply a drug; alerts that inform a clinician that something is amiss, 
such as a drug being prescribed that will react badly to another 
prescribed drug).
               incentives for using, not just having hit
    Federal funding to promote the adoption of HIT will only result in 
improvements in care if HIT systems are used to perform key value-
enhancing functions, including:

     exchanging data on prescriptions, laboratory tests, and 
imaging procedures;
     developing evidence on the safety and effectiveness of 
treatments; and
     reporting on safety, quality and affordability.

    Interoperability and technical capabilities are important, but 
investments will prove most effective if tied to process changes that 
improve patient safety and clinical outcomes, while making the health 
care experience more meaningful.
    HIT investments and incentives should be tied to the effective use 
of HIT to improve patient safety, outcomes and experience of care, not 
just having it. To support this need, NQF has endorsed a set of 
performance measures emphasizing HIT use in five areas: electronic 
prescribing, interoperability/information exchange, care management, 
quality registries, and the medical home. For example, the two care 
management measures endorsed by NQF assess the use of HIT to identify 
specific patients in need of care, track their preferences and lab 
results, and assist the clinician in providing evidence-based care 
according to national guidelines using automated alerts and reminders. 
To ensure information about patients doesn't fall through cracks in the 
healthcare delivery system, the first of these NQF measures addresses 
HIT used during a patient-clinician visit and the second addresses 
capturing and sharing clinical results between visits.
    In conclusion, the NQF supports Federal funding to promote the 
adoption of HIT as an essential foundation for improving health care 
safety, quality and affordability, but it is important to invest 
wisely. This investment will yield far greater returns in terms of 
higher quality, more affordable care, if steps are taken now to ensure 
that EHRs and PHRs possess the necessary capabilities to support 
performance measurement and improvement; and if investments are tied to 
the effective use of HIT to enhance patient care.
    Thank you again for your focus on how HIT can drive improvements in 
healthcare quality and efficiency.
                                 ______
                                 
                                Summary
    The NQF supports Federal funding to promote the adoption of health 
information technology (HIT) as an essential foundation for improving 
health care safety, quality and affordability, but it is important to 
invest wisely. This investment will yield far greater returns in terms 
of higher quality, more affordable care, if steps are taken now to 
ensure that EHRs and PHRs possess the necessary capabilities to support 
performance measurement and improvement; and if investments are tied to 
the effective use of HIT to enhance patient care.
                    hit's role in improving quality
    HIT is one critical organizational support; however HIT is not 
enough on its own to transform the delivery system. HIT is a tool that 
must be used effectively. Investments in HIT will have the greatest 
impact if pursued within a broader policy agenda that encourages the 
development of higher levels of organizational capacity in all practice 
settings. Investment in HIT now will also enable more effective 
implementation of other elements of a comprehensive reform agenda over 
the coming years including: availability of information on the 
effectiveness of alternative treatments; reform of payment programs to 
promote value; and informed patient choice and shared decisionmaking. 
Virtually all of these strategies will require more comprehensive 
performance information than is currently available--performance 
information on the entire patient-focused episode including measures of 
patient outcomes, care processes, and resource use.
       hit that supports performance measurement and improvement
    Funds for HIT included in the stimulus provide an opportunity to 
take important steps towards the establishment of a secure, 
interoperable, nationwide health information network. The current state 
of the technology and standards is adequate to support this investment 
now. EHRs and PHRs must capture the necessary data to calculate 
measures; and provide clinical decision support (CDS) to providers to 
enhance performance. Establishing an HIT infrastructure to fully 
support performance measurement and improvement requires close and 
ongoing collaboration between the ``quality community'' and the ``HIT 
community.''
    Efforts are now well underway to create such a ``bridge.'' In 2007, 
NQF established the Health Information Technology Expert Panel (HITEP), 
chaired by Paul Tang, M.D., Palo Alto Medical Foundation. The initial 
work of HITEP has focused on identifying the types of data that must be 
captured in EHRs to calculate the performance measures that are 
currently used by Medicare for public reporting purposes. HITEP is now 
working collaboratively with the Health Information Technology 
Standards Panel (HITSP), which is translating the ``Quality Data Set'' 
into HIT standards and the Certification Commission for Health 
Information Technology (CCHIT), which promotes the development of EHRs 
consistent with national standards.
    The NQF recommends that future efforts build upon this important 
collaborative work and not to reinvent the wheel. The ``Quality Data 
Set'' will support both public reporting and enhanced patient care. It 
will enable real-time feedback to clinicians on their performance and 
clinical decision-support.
               incentives for using, not just having hit
    Federal funding to promote the adoption of HIT will only result in 
improvements in care if HIT systems are used to perform key value-
enhancing functions, including: exchanging data on prescriptions, 
laboratory tests, and imaging procedures; developing evidence on the 
safety and effectiveness of treatments; and reporting on safety, 
quality and affordability.
    HIT investments and incentives should be tied to the effective use 
of HIT to improve patient safety, outcomes and experience of care, not 
just having it. To support this need, NQF has endorsed a set of 
performance measures emphasizing HIT use in five areas: electronic 
prescribing, interoperability/information exchange, care management, 
quality registries, and the medical home. To ensure information about 
patients doesn't fall through cracks in the healthcare delivery system, 
the first of these NQF measures addresses HIT used during a patient-
clinician visit and the second addresses capturing and sharing clinical 
results between visits.

    Senator Mikulski. Thank you. That was excellent. It really 
complements with what Mr. Cochran says and this whole issue of 
not only having it, but using it. So it has got to be usable, 
and then this buy-in from the physicians.
    Well, I think that is a good time now to turn to our 
private sector experience, and Mr. Neupert, let us hear from 
the microchip crowd.
    [Laughter.]

 STATEMENT OF PETER NEUPERT, VICE PRESIDENT, MICROSOFT HEALTH 
                     SOLUTIONS, REDMOND, WA

    Mr. Neupert. Thank you, Senator Mikulski.
    My name is Peter Neupert, and I am the corporate vice 
president of Microsoft's Health Solutions Group.
    For over a decade, Microsoft has increased its commitment 
to health, developing software solutions supporting both 
consumers and businesses. And I am glad you are fired up 
because I am, too.
    We have a powerful vision of the future. We see a dynamic 
patient-centric health system that transforms how physicians 
provide care and individuals manage their health, a totally 
connected network enabling the seamless exchange and reuse of 
health data.
    Across the healthcare industry today, there are examples of 
organizations starting to realize this vision. The Marshfield 
Clinic, Kaiser Permanente, the Department of Veterans Health 
Affairs, and many others whose leadership thought about clear 
outcomes and embraced technology as a means to drive improved 
outcomes, efficiency, quality, and a reduction of costs. They 
built patient-centric, connected systems.
    We believe that these kinds of successes need to be scaled 
nationally. We can expand on these successes and embrace their 
core ideals by doing the following three things.
    First, we must drive the right health outcomes and payments 
to incent innovation. We must build an industry focused on 
lifelong wellness and reward caregivers when diseases and 
conditions do not develop. We need to reward doctors who 
provide preventive care and allow them to innovate in 
delivering care in new connected electronic ways.
    Second, we must connect and share data among and between 
health organizations. Having access to a lifetime record of 
treatments, prescriptions, and tests will allow individuals and 
healthcare providers to make better medical decisions, reduce 
wasteful spending, and increase the quality of care. Health 
data is and should be treated as a valuable asset.
    Third, we must empower consumers to be stewards of their 
own health data. Just as credit scores represent a lifetime of 
active and passive financial decisions and transactions, so 
should health data. We must help consumers to start building 
their health data into a lifelong asset, to manage it over 
time, and to share with those who support them in making key 
health decisions. We should begin today, with the health data 
that already exists electronically.
    To move forward, we recommend that the public and private 
sectors take the following five steps. First, encourage 
innovation in health IT by setting out objective goals and 
criteria, not by mandating specific technologies or development 
models.
    Second, reward innovative doctors who make the Internet the 
foundation for the patient-physician connection.
    Third, provide incentives for sharing data today.
    Fourth, focus on making data interoperable today, not 
waiting for future standards and insist that vendors separate 
data from their applications.
    And fifth, and last, enable the private sector to develop 
an information infrastructure that connects data, systems, and 
people.
    When we wanted to go to the Moon, we didn't focus on 
building the rocket. We set the goal of landing on the Moon, 
and we used money, technology, and innovation to make it 
happen. Once health objectives are set, stakeholders in the 
health ecosystem can figure out the right technology to reach 
these goals.
    Microsoft looks forward to collaborating with the public 
sector and others in industry to drive real change in our 
healthcare system.
    Thank you for the opportunity to appear before you today.
    [The prepared statement of Mr. Neupert follows:]
                  Prepared Statement of Peter Neupert
    Chairman Kennedy, Ranking Member Enzi, and distinguished members of 
the committee, my name is Peter Neupert, and I am Corporate Vice 
President of Microsoft's Health Solutions Group. Thank you for the 
opportunity to share Microsoft's perspective on investments in health 
IT. We appreciate how much time and attention the committee has spent 
on this critical issue, and we commend you for your work in advancing 
the debate on information technology as part of healthcare reform.
    My testimony begins by describing what we believe to be the future 
of U.S. healthcare--a totally connected, patient-centric system. It 
explains how technology can help make that future a reality by 
encouraging better outcomes and innovation, connecting patient data, 
and empowering consumers to be stewards of their own health. It then 
outlines ways in which the public and private sectors can work together 
to create an efficient, data-driven healthcare system, benefiting 
patients, healthcare providers, and the overall U.S. economy. Finally, 
it concludes by describing Microsoft's existing investments in health 
IT and how they are being implemented today.
    i. the future: the u.s. health system transformed by technology
    At Microsoft, we envision a dynamic, patient-centric health system 
that transforms the way physicians provide care and individuals manage 
their own health--a totally connected network that delivers predictive, 
preventive, and personalized medicine in an accessible, affordable, and 
accountable way. Specifically, we see:

     Patients as consumers.--Experiencing more control, more 
convenience, better service, and ultimately better value for what they 
spend on healthcare.
      Physicians as knowledge workers.--Professionals getting 
the right data in the right format at the right time to provide the 
best treatment and preventive care.
      New interactions among the key members of the healthcare 
ecosystem.--Physicians, patients, pharmacies, researchers, and 
insurance providers benefiting from a new flow of data to make better, 
faster decisions.
      The extension of modern healthcare to the virtual 
space.--Patients getting care when they want it, wherever they need it, 
thanks to virtual medical clinics, virtual doctor visits, virtual lab 
results, medical homes, and personalized medicine based upon genomic 
data.
      A learning healthcare system.--One that measures 
everything, identifies errors, and makes improvements in order to 
deliver value.\1\
---------------------------------------------------------------------------
    \1\ Institute of Medicine Roundtable on Evidence-Based Medicine, 
Learning Healthcare System Concepts v. 2008 (2008).

    In summary, it is a world where everyone in the health ecosystem 
has the right information at the right time with computer-assisted 
decision support, enabling the seamless exchange and re-use of data. 
Health data is the asset that drives an efficient, high-quality, value-
based, evidence-focused future for medicine.
   ii. the blueprint: building a scalable, patient-centric health it 
                                 system
    We all know that information technology is a vital component in 
improving our healthcare system. But simply spending more money on 
information technology, without considering all the factors driving 
behavior in our healthcare system, is unlikely to lead to better health 
outcomes. There have been many investments in technology that did not 
solve the problems of better quality outcomes, increased access, or 
reduced costs.
    However, across the healthcare industry today, there are many 
examples of successful technology investments--the Marshfield Clinic, 
Kaiser Permanente, the Department of Veterans Affairs, and others. 
These are organizations whose leadership thought about clear outcomes 
and embraced technology on many different levels to drive improved 
efficiency, quality, and a reduction of costs across their systems. In 
essence, they created patient-centric systems. We believe that these 
are the kinds of successes that need to be scaled nationally.
A. Driving the Right Health Outcomes and Payments to Incent Innovation
    An industry focused on lifelong wellness and outcomes would reward 
caregivers when diseases and conditions do not develop.
    The problem with our current healthcare system is that it is 
designed to care for people who are ill, not to keep people healthy. 
For example, we focus on providing episodic treatment and medication to 
diabetics instead of asking how we can raise awareness of diabetes risk 
factors and prevent people from developing diabetes in the first place. 
The system is this way because we do not reward doctors who provide 
preventive care or innovative services.
    Doctors typically receive a flat fee for each treatment they 
perform, regardless of the quality of the care, and the amount of the 
fee is set by a bureaucracy of insurers, health plans, and regulators. 
In this fixed-price system, there is no incentive for providers to 
improve customer satisfaction. Most physicians are not reimbursed for 
telephone or e-mail consultations, let alone more advanced uses of 
technology. Doctors who attempt to innovate--for example, by investing 
in systems to collect data from patients remotely--end up delivering 
better care but making less money.
    In health-related areas where prices are set by the market, such as 
veterinary medicine, dentistry, and cosmetic surgery, providers do a 
much better job of investing in services that attract customers. For 
example, pet owners willingly pay for veterinarians who make house 
calls, maintain electronic medical records, remind owners to bring 
their pets in for scheduled vaccinations, call to make sure the pets 
are taking their pills, and are available for e-mail or telephone 
consultations. Veterinarians compete on price and quality, so they are 
constantly looking for innovations that allow them to provide better 
service and improve customer satisfaction. Because technology is often 
a source of innovation, veterinarians are quick to embrace new 
technologies that fuel better service and better patient care. We need 
to learn from these examples.
B. Connecting and Sharing Data Among and Between Health Entities
    We believe the first step is to connect the many medication lists, 
laboratory test results, and diagnostic images that are already 
maintained electronically. Eventually, we can build a lifetime record 
of treatments, prescriptions, and tests that allows individuals and 
healthcare providers to make better medical decisions, reduce wasteful 
spending, and increase the quality of care.
    Our current system is built around the idea of a specific provider 
prescribing specific treatment for a specific condition. Patients' 
health data is locked inside each provider's silo, without being 
connected or shared. Physicians are forced to either make treatment and 
prescription decisions without all available clinical data, or else 
waste time and resources attempting to aggregate data. MedStar Health's 
Washington Hospital Center estimates that 60 percent of a clinician's 
time is spent searching or waiting for information, with only 16 
percent spent on direct patient care.\2\
---------------------------------------------------------------------------
    \2\ Microsoft Health Solutions: Helping People Live Longer, 
Healthier Lives (June 26, 2007).
---------------------------------------------------------------------------
    The right investments in health IT can tear down these silos, 
offering patients and doctors a holistic picture of a patient's health 
history and thereby improving care. Consider chronic diseases, which 
account for over 75 percent of healthcare spending.\3\ Even though most 
care for chronic diseases occurs at home, data from at-home care is not 
integrated with data available at the hospital or at the doctor's 
office. Individuals and providers would all benefit if, for example, 
patients with diabetes could upload their blood glucose readings to a 
Web site that offered personalized advice and guidance; receive 
information alerts regarding changes in recommended treatment or 
behavior; share their results with a supportive community of fellow 
patients; and securely transmit readings to their clinician. Patients 
would have more information on managing their condition, would be in a 
better position to prevent acute incidents, and would need to make 
fewer trips to the doctor. Treating physicians would have a greater 
ability to understand their patients' health over time, allowing them 
to identify the best treatment for existing patients and to help people 
who are at risk of developing the disease in the future.
---------------------------------------------------------------------------
    \3\ Centers for Disease Control and Prevention, Chronic Disease 
Overview (Nov. 20, 2008), http://www.cdc.gov/nccdphp/overview.htm.
---------------------------------------------------------------------------
    c. empowering consumers to be stewards of their own health data
    Finally, we need to empower consumers to manage their health data. 
Just as credit scores represent a lifetime of active and passive 
financial decisions and transactions, so should health data. We must 
help consumers to start building their health data into a lifelong 
asset, to manage it over time, and to share with those who support them 
in making key decisions both within and outside of the health system.
    Today, in order to manage their health, consumers must deal with 
both paper documents and electronic files. They fill out form after 
form, calling multiple doctors' offices for appointments. Few people 
have the resources to keep track of medication lists, vaccination 
histories, appointment calendars, lab results, diet plans, exercise 
schedules, and all the other components of health data. Many have 
little knowledge of how to prevent disease and little, if any, support 
for managing their healthcare.
    Now imagine if consumers could connect all their health and 
wellness data electronically, share it securely from provider to 
provider, and keep it in one place over time, no matter the doctor or 
the insurance company. They would have all the relevant data at their 
fingertips, accessible at any time and any place. They could sign up 
for services that would provide personalized alerts and information. 
They could track fitness goals across numerous devices, such as 
exercise bikes that monitor vital signs, smart watches that record the 
number of miles run, and scales that measure body fat as well as 
weight. They could research relevant medical conditions online and 
interact with support groups so that they would be better prepared and 
informed for their next visit to the doctor. They could share data with 
their support systems and make better health decisions for themselves 
and their families.
    We believe technology can make this vision a reality. The Internet 
and online social networks have already become an everyday resource for 
consumers seeking information in order to make health decisions, but 
what is missing is a way to link this information back to the 
individual's personal health history. And consumers are ready for it:

     78 percent of Americans favor giving doctors the ability 
to share access to their medical records if done with their 
permission.\4\
---------------------------------------------------------------------------
    \4\ Council for Excellence in Government et al., The American 
Public on Healthcare: The Missing Perspective (2008), http://
www.excelgov.org/Programs/ProgramDetail.cfm?ItemNumber=
9404.
---------------------------------------------------------------------------
     66 percent see value in including their own information 
anonymously in a large database to help researchers.\5\
---------------------------------------------------------------------------
    \5\ Id.

    Pharmacy benefit managers maintain medication lists electronically, 
and many hospitals digitally record laboratory test results and 
diagnostic images. As a first step in empowering consumers, we could 
require providers to give patients electronic copies of any data that 
is already available in electronic format. Providing consumers with 
access to their healthcare data in a secure and private way, and 
allowing them to keep it in one place over time and share it from 
provider to provider, will permit them to make the best daily decisions 
about their health. It also will enable healthcare professionals to 
deliver better care.
        iii. the next steps: recommendations for moving forward
    Microsoft has learned a great deal over the past several years as 
we have worked to improve healthcare through information technology. We 
know that just spending more money on health IT will not solve the 
problems in today's healthcare system. We believe the right investments 
are those that focus on the right outcomes. We believe that it is 
essential that data be connected and shared so that consumers and 
health enterprises can build their health data assets over time.
    To achieve our vision will require that the public and private 
sector take several steps, including:

     Encourage innovation in health IT by setting out objective 
goals and criteria, not by mandating specific technologies or 
development models. Hundreds of innovative health IT products and 
services are available on the market today, and many companies are 
investing large sums to develop new technologies and solutions. Even as 
they compete, however, companies are collaborating to enable their 
products to work together and share information regardless of their 
underlying development, licensing, or business models. To take one 
example, Microsoft's HealthVault can interface with the open source 
VistA EHR system and other open source healthcare applications.
    As Congress considers how best to spur the broad adoption of health 
IT systems, it should take care not to mandate or prescribe any 
particular technology or development model. Doing so could deprive 
healthcare providers of the best available solutions, exclude scores of 
American companies and workers from competing to supply these 
solutions, and weaken incentives for further private-sector investment 
and R&D--just when we as a Nation should be trying to strengthen these 
incentives. To the extent Congress seeks to influence the development 
or adoption of health IT systems, it should set forth objective, 
technology-neutral goals and criteria that these systems should meet, 
such as those relating to security, privacy, interoperability, and 
total cost of ownership. It should then open the door to all companies 
to compete for the opportunity to supply health IT solutions that 
satisfy these criteria.
     Reward innovative doctors who make the Internet the 
foundation of the patient-physician connection. The Internet has 
created a society that has access to, and demands access to, up-to-date 
information around the clock. Patients need information about their 
medical conditions, appropriate drugs or treatments, pre-procedure 
instructions, and post-visit follow-ups. The Internet is the most 
efficient way for doctors to provide the ``trusted information'' that 
consumers want. But the fixed-price nature of physician reimbursement 
means that innovative doctors have no incentive to deliver this kind of 
additional service. Physicians should be encouraged to embrace basic 
Internet technologies that allow them to communicate more effectively 
and consistently with their patients.
     Provide incentives for sharing data. We believe that it is 
critical to seamlessly connect data and empower individuals to take 
control of their health and wellness. We hope that those in the public 
sector will facilitate the transformation of health data into a vital 
asset by removing barriers to data sharing and providing incentives for 
data exchanges that reduce costs, increase value, and improve the 
quality of care.
     Focus on making data interoperable today, not waiting for 
standards tomorrow, and insist that vendors separate data from 
applications. Microsoft is committed to the development of 
interoperability standards and works diligently with the rest of the 
industry to reach consensus on those standards, but exchanging 
healthcare data cannot wait--we need a migration path now. Today, data 
is too often used for a single application or a single purpose, then 
thrown away once that purpose is complete. We can use metadata--the 
details that describe the data and how it has been captured--to ensure 
that data is kept alive and made available for reuse, no matter what 
its original application or purpose. By insisting that vendors supply 
IT that allows data transfers to and from other non-vendor 
applications, we can get data moving better and faster between 
different systems today, without waiting for standards that may take 
years to complete. Better use of metadata will pave the way for 
integrating legacy data with standards-based data once these standards 
are more widely adopted.
     Enable the private sector to develop an information 
infrastructure that connects data, systems, and people. To move from 
today's fragmented delivery system to tomorrow's connected network, we 
need technology infrastructure--``plumbing''--that allows data to flow 
freely throughout the system and be reused. Without it, we will 
recreate our disconnected paper system in the virtual space. This 
infrastructure must be (1) flexible, to enable many different players 
across the ecosystem to do what they need to do; (2) interoperable, to 
leverage existing standards and infrastructure investments that work 
toward more unified ways of organizing and sharing data; (3) scalable, 
to adapt to the rate of medical and technology advances; and (4) secure 
and private, to foster consumer trust.
        iv. how microsoft can help: our investments in health it
    More than 12 years ago, Microsoft started making investments in the 
health industry. We saw software and the Internet as essential tools to 
transform healthcare, as they have so many other industries--opening 
new ways of working, new ways of communicating, and new economics. We 
have steadily increased our investments and commitment to health 
globally. Our vision was simple--to improve health around the world 
through software innovation. From the beginning, we have thought about 
improving health in the developed world as well as developing 
economies. We have focused globally on openness and interoperability to 
drive truly scalable solutions that can benefit all.
    We are concerned with the current focus on electronic medical 
records (EMRs) as a panacea. While some forms of EMRs are necessary, 
they represent only a part of the solution. The future vision we 
describe is far broader than simply making records electronic.
    We have a set of solutions in the market facilitating the 
connection and sharing of data for consumers and large health systems 
to help them build their health data assets.
A. Empowering Consumers to Access, Consolidate, and Share Their Health 
        Data
    For consumers, we launched HealthVault, a privacy and security-
enhanced data storage and sharing Internet-based platform. People can 
use HealthVault to store copies of their health records from providers, 
plans, pharmacies, schools, government, or employers; upload data from 
home health devices like blood glucose monitors and digital scales; 
provide data to health care providers, coaches, and trainers; and 
access products and services to help improve their health. We worked 
with leaders across the industry to ensure that the right privacy and 
security standards would be in place, and we are seeing momentum 
starting to happen. Since launching, we have enabled 50 devices, have 
40 live applications--services on top of HealthVault such as PHRs, 
alert services, etc.--and signed 91 partners across the country, 
including leading organizations like Aetna, Kaiser Permanente, 
Cleveland Clinic, and the Military Health System.
    Of particular note is a pilot project with Cleveland Clinic that 
could have a wide-ranging impact on care--extending care to the home 
from traditional hospitals and doctors' offices. It is the first pilot 
in the country to follow multiple diseases (it addresses chronic 
disease management in the areas of diabetes, hypertension, and heart 
failure) in the clinical delivery setting using multiple at-home 
devices including glucometers, heart rate monitors, weight scales, and 
blood pressure monitors. Patients enrolled in the pilot upload device 
data to HealthVault using a home computer, and Cleveland Clinic 
downloads the data into the patients' Cleveland Clinic MyChart 
accounts, creating an online log of the readings available for 
physicians. We are particularly excited about the results of the pilot. 
Monitoring constant data, and having it shared in an efficient way with 
physicians, can result in better quality of life and increased 
efficiency. Even possible is the avoidance of acute care incidents, 
impacting expense.
B. Empowering Health Systems to Provide Patient-Centric Care
    For hospitals and health systems, just under a year ago, we 
launched Amalga, our family of data sharing and intelligence solutions, 
which connect a hospital's or health system's existing legacy systems 
and any new systems. This allows patient data to be viewed and queried 
holistically, enabling a shift from departmentally focused systems to 
more patient-centric systems. Amalga has been adopted by many leading 
health organizations--Johns Hopkins, New York Presbyterian, Mayo 
Clinic, MedStar Health, St. Joseph Health System, Moffitt Cancer Center 
and Research Institute, District of Columbia Primary Care Association, 
Wisconsin Health Information Exchange, Novant Health, Children's 
Healthcare of Atlanta, and the University of Washington.
    Of particular note is the Wisconsin Health Information Exchange 
(WHIE), the first health information exchange to use Amalga. Eight 
months ago, the WHIE set specific goals to improve physician 
decisionmaking and quality care in their emergency rooms. The project 
aggregates patient data from State Medicaid claims, 13 area hospitals, 
and more than 110 hospital-associated clinics in southeast Wisconsin. 
Amalga presents a single view of aggregated patient data, in real-time, 
to emergency department doctors at five area hospitals. Gaining a 
comprehensive view of a patient--including pharmacy prescription data, 
imaging and lab procedures, current and previous diagnoses as well as 
hospital admission, discharge, and transfer records--enables emergency 
room doctors to make fully informed decisions about the patient's care 
in time-critical situations. The benefits include reduced errors, more 
efficient care (physicians can see if tests have already been done so 
that tests are not repeated), and more effective ways to treat patients 
(physicians can see if patients have been to the ER multiple times, 
enabling them to follow up more aggressively or put patients on a 
different care routine to avoid further ER visits).
    The early success of the WHIE Project has prompted Humana, one of 
the Nation's largest health benefits companies, to provide an incentive 
to providers for utilization of the WHIE. As part of its emergency care 
initiatives, Humana has entered into a pilot program with the WHIE. In 
this program, Humana recognizes the value of applying health 
information exchange technology, and its impact on avoiding duplication 
of services, and has agreed to provide a WHIE-administered incentive to 
ER physicians for utilization of the tool.
    As we move into 2009 and beyond, we will expand our products and 
develop a new generation of software and services to help support and 
speed the move towards efficient, data-driven medicine.
    When we wanted to go to the moon, we did not focus on spending 
exorbitant amounts of money to build a rocket. We set the goal of 
landing on the moon, and we used money, technology, and innovation to 
make it happen. Once health objectives are set, stakeholders in the 
health ecosystem can figure out the right technology to reach the goals 
as efficiently and effectively as possible.
    Microsoft looks forward to collaborating with the public sector and 
others in industry to drive real change in our healthcare system. Thank 
you for the opportunity to appear before you today.
                                 ______
                                 
      Reinventing Healthcare Through Health Information Technology
                               the future
    Dynamic, Personalized, Consumer-Driven Healthcare. At Microsoft, we 
have a powerful vision for how technology can improve healthcare, much 
broader than simply the use of electronic medical records. We envision 
a connected health ecosystem that delivers predictive, preventive, and 
personalized care. We see:

     Patients as consumers.--Experiencing more control, more 
convenience, better service, and ultimately better value for what they 
spend on healthcare.
     Physicians as knowledge workers.--Professionals getting 
the right data in the right format at the right time to provide the 
best treatment and preventive care.
     A learning healthcare system.--One that measures 
everything, identifies errors, and makes improvements in order to 
deliver value.

    This new system will enable a data-centered approach to healthcare 
that shifts the priorities from treatment and cure to prevention and 
lifelong wellness.
                             the blueprint
    A Scalable, Patient-Centric Health IT System. Instead of allowing 
healthcare professionals to control the patient experience and 
healthcare facilities to control patient records, individuals are now 
poised to take greater responsibility for their overall health and 
wellness. Technology can drive this transformation by:

     Encouraging better outcomes and more innovation. Under 
today's flat-fee system, most physicians are not reimbursed for 
telephone or e-mail consultations, let alone more advanced uses of 
technology. In contrast, providers who compete on price and quality are 
constantly looking for ways to improve service.
     Connecting patient data. Because patients' health data is 
locked in silos, physicians are forced to either make treatment 
decisions based on incomplete data, or else waste time and resources 
aggregating information. A complete health history would enable 
providers to make better medical decisions, decrease wasteful spending, 
and increase the quality of care.
     Empowering consumers. If consumers could connect all their 
health and wellness data electronically, share their data securely with 
different providers, and keep it in one place over time, they would 
have information at their fingertips to make better choices about 
physicians, care options, and ways to improve their overall well-being.
                             the next steps
    Recommendations for Moving Forward. To facilitate the use of health 
IT, we need to:

     Encourage innovation in health IT by setting out objective 
goals and criteria, not by mandating specific technologies or 
development models. The proposed ``open source'' preference would 
disadvantage a broad range of innovative, cost-effective health IT 
offerings already available in the market and undermine incentives for 
further industry investment in health IT. Rather than require the 
Administration to adopt a particular technology or development model, 
Congress should establish a framework based on objective, neutral 
criteria and then encourage all companies to compete on the merits.
     Reward innovative doctors who make the Internet the 
foundation of the patient-physician connection. Physicians should be 
encouraged to embrace basic Internet technologies that allow them to 
communicate more effectively and consistently with their patients.
     Provide incentives for sharing data. Removing barriers on 
data sharing and providing incentives for data exchanges would help 
shift healthcare economics, from expensive acute care setting to smart 
services in the home.
     Focus on making data interoperable today, not waiting for 
standards tomorrow, and insist that vendors separate data from 
applications. Vendors need to supply IT that allows data to be 
separated from applications and made available for reuse. Metadata-
driven interoperability can get data moving better and faster between 
different systems today.
     Enable the private sector to develop an information 
infrastructure that connects data, systems, and people. A system that 
is flexible, interoperable, scalable, private, and secure will ensure 
that data flows freely and is reused.

    Microsoft is developing health IT solutions that facilitate the 
connection and sharing of data. We look forward to collaborating with 
the public sector and others in industry to drive real change in our 
healthcare system.

    Senator Mikulski. That was excellent and meaty. I hope you 
are not recommending that we develop a health score because for 
each and every one of us, there would be a lot of pass and 
fails going along with it. But I think this is exactly what we 
were looking for.
    Before we go to you, Ms. Grealy, I want to acknowledge and 
welcome a new member to the HELP Committee, Senator Merkley 
from the State of Oregon.
    Senator, we welcome you and look forward to your active 
participation. We are taking our testimony, and I will be 
asking some questions, and we will be sure to turn to you.
    Senator Merkley. Thank you very much.
    Senator Mikulski. Ms. Grealy.

  STATEMENT OF MARY GREALY, PRESIDENT, HEALTHCARE LEADERSHIP 
                    COUNCIL, WASHINGTON, DC

    Ms. Grealy. Chairman Mikulski and members of the committee, 
I want to thank you on behalf of the members of the Healthcare 
Leadership Council for this opportunity to testify on health 
information technology as a vital component of both economic 
recovery and healthcare reform.
    Last Sunday on ABC News, President-elect Obama expressed 
again his determination to invest in health information 
technology to make our healthcare system better, to reduce 
medical errors, and to save Americans money. We could not be 
more supportive of the President-elect's priorities.
    There is considerable evidence of the impact, both on our 
finances as well as our well-being, of HIT. Let me cite just 
one example.
    One of our members, NorthShore University HealthSystem of 
Evanston, IL, has an electronic health record system that was 
implemented in 2003. Today, over 50,000 NorthShore patients can 
schedule appointments, refill prescriptions, or communicate 
with their doctors via the Internet.
    Thanks to the ability to immediately check whether patients 
are receiving conflicting medicines, they have reduced 
medication error rates by 80 percent.
    Senator Mikulski. Whoa.
    Ms. Grealy. Thanks to the ability also to quickly identify 
infections in patients upon admission and their ability to 
manage those infected patients, they have reduced their MRSA 
infections by 70 percent.
    Well, it is no wonder that HHS estimates savings as high as 
$400 billion over a 5-year period if we implement a national 
health information network. But how do we get to this bright 
future?
    There are three critical steps. The first is to create 
funding mechanisms to assist healthcare providers with the 
large infrastructure investments necessary for them to take 
part in the HIT revolution.
    As you noted, only a small percentage of physician offices 
and 20 to 25 percent of hospitals have adopted an electronic 
record system, and the predominant obstacle cited is cost. 
Investing in HIT through economic recovery or stimulus 
legislation would be a tremendous catalyst.
    Second, we need to encourage innovation in the field of 
standards development and foster innovation, which is 
absolutely essential to achieving nationwide interoperability. 
We firmly believe that the private sector should work 
collectively to develop a road map for an effective, efficient 
health information exchange.
    The newly announced National eHealth Collaborative is 
poised to do effective work in this regard, and it is an 
important responsibility for the Federal Government to ensure 
that all involved stakeholders are at that collaborative table.
    And finally, the Healthcare Leadership Council believes 
that engendering patient and consumer trust in the electronic 
exchange of information will be paramount to successful 
implementation of HIT. Progress hinges on striking a critical 
balance, protecting privacy while ensuring that medical 
professionals have ready access to the information that they 
need to save lives and provide quality care.
    As I noted earlier, Senator Mikulski, the evidence is 
clear. HIT development will pay substantial dividends in the 
form of healthier Americans, improved care, and lower cost. Our 
members have absolutely seen the return on the investment that 
they have made.
    Including HIT funding in the economic recovery stimulus 
measure will be a down payment on a brighter future that 
deserves our enthusiastic support. We look forward to working 
with you not only on HIT, but also on that larger issue of 
healthcare reform.
    Thank you.
    [The prepared statement of Ms. Grealy follows:]
                  Prepared Statement of Mary R. Grealy
    Senator Mikulski and other members of the committee, I want to 
thank you on behalf of the members of the Healthcare Leadership Council 
(HLC) for the opportunity to testify on health information technology 
(HIT) funding as an important component of economic stimulus and its 
role in health care reform.
    My name is Mary Grealy and I am president of the Healthcare 
Leadership Council (HLC), a not-for-profit membership organization 
comprised of executives of the Nation's leading health care companies 
and organizations. Fostering innovation and constantly improving the 
affordability and quality of American health care are the goals uniting 
HLC members.
    Last May, HLC released Closing the Gap: A Proposal to Deliver 
Affordable, Quality Health Care to All Americans. This proposal 
represented months of work and collaboration among HLC members and an 
acknowledgment that health care must be delivered more efficiently, 
safely, and effectively in this country. Widespread adoption of HIT 
affords us the opportunity to accomplish all of those things and more. 
Members of HLC--hospitals, academic medical centers, health plans, 
pharmaceutical companies, medical device manufacturers, biotech firms, 
health product distributors, and pharmacies--have seen firsthand what 
widespread adoption of HIT can mean to patients.
    Several HLC member organizations are among the pioneers of health 
information technology. The collective experiences and achievements of 
these early adopters leads us to believe that HIT has the capability to 
transform our health care system by providing increased efficiencies in 
delivering health care; contributing to greater patient safety and 
better patient care; and achieving clinical and business process 
improvements. In combination with improvements to health care payment 
and delivery systems, HIT could have an even greater impact on 
improving health outcomes and lowering costs.
    While many HLC members have embraced the promise of HIT, as many 
have testified before this and other committees of Congress in the past 
few years, physician and hospital uptake of this technology has been 
slow to date. Health care lags behind other industries in embracing 
information technology. When surveyed as to the reasons why they are 
hesitant to ``go electronic,'' non-adopters often cite many reasons--
ranging from confusion or lack of understanding of new systems to 
liability concerns. But time and again, cost is identified as the most 
substantial barrier to widespread adoption and use of HIT.
    In my testimony I will discuss the ways in which HIT brings greater 
quality and value to our health care system. I've included as part of 
my written statement an attachment (see Attachment 1) that describes 
how various HLC member companies and organizations have already 
achieved significant success utilizing information technology.
    I also will outline the need for congressional action to remove 
barriers to nationwide adoption of HIT by creating funding mechanisms 
to assist health care providers with the sizable IT infrastructure 
investments that are necessary if they--and their patients--are to be 
part of this technological revolution. Lastly, I will address the need 
for Congress to oversee the development of national, uniform standards 
and address privacy concerns as part of an interoperable health 
information network.
                          the benefits of hit
    HIT holds the potential to move our country toward truly patient-
centered health care. The value proposition of HIT is putting tools in 
place to empower patients and physicians to make better decisions with 
more information at their fingertips. At the consumer level, HIT will 
help patients navigate their health care journey and arm them with 
decisionmaking abilities that have been elusive due to the lack of 
meaningful and actionable information at their disposal. This would 
lead to improvements in care management by empowering patients, their 
care givers and providers with critical information to improve care 
continuity and health outcomes.
    Many HLC members are using electronic health records and other 
forms of HIT and documenting their successes. For instance, one of our 
members, NorthShore University HealthSystem of Evanston, IL, has 
operated a patient-centric electronic health record (EHR) system since 
2003. Over 50,000 of NorthShore's patients enjoy a direct link to the 
system on their home computers and PDAs, which enables them to schedule 
appointments online, refill prescription drug orders, and communicate 
with their primary care providers.
    Since that time, NorthShore has garnered concrete evidence that 
EHRs are a critical tool that can improve care quality and patient 
satisfaction, as well as create efficiencies that lead to a positive 
return on investment. For example, they have cut in half the amount of 
time it takes to deliver the first dose of medication to an inpatient 
because of the speed with which they can check the possibility of 
conflicting medications or allergic reactions. This has resulted in a 
medication error reduction rate of close to 80 percent.
    Furthermore, a March 2008 study in The Annals of Internal Medicine 
that was also reported in The Wall Street Journal, demonstrated a 70 
percent reduction in MRSA infections at the three hospitals in 
NorthShore's system. The use of HIT to identify infections and manage 
affected patients across the health care system was crucial to this 
undertaking.
    HLC believes that the establishment of similar nationwide health 
information connectivity among physicians, and health care 
professionals such as home health aides, care managers, health plans, 
and others across the continuum of care, will dramatically improve both 
the quality and effectiveness of care. That is not to say that we 
believe HIT is the ``silver bullet'' that will address all of the 
health care challenges we face. We believe, though, that combined with 
comprehensive health system reform, HIT is a critical component in 
lowering health care costs over the long-term and providing safe, 
effective, efficient and equitable patient care.
    Another way in which HIT would improve quality is by reducing or 
eliminating duplicative medical care and over-utilization, which the 
National Priorities Partnership has identified as one of the six areas 
on which quality improvement efforts should focus. William Yasnoff, 
former Senior Advisor on the National Health Information Infrastructure 
for the U.S. Department of Health and Human Services (HHS), posits that 
20 percent of all laboratory tests and radiology studies are redundant, 
performed because the results of previous tests are not available at 
the point of care. HHS estimates that nationally, savings could reach 
more than $400 billion through the implementation of a national health 
information network.
    Perhaps the greatest benefit of HIT is its potential to reduce 
medical errors. As is the case in other industries, technology in 
medicine will help to prevent the incidence of human error. A February 
2008 USA Today article and an Auburn University study show that as 
Americans age, the projected odds of getting a prescription that 
results in a serious, health-threatening error is about 1 in 1,000. 
That could amount to 3.7 million such errors a year, based on 2006 
national prescription volume. (USA Today. ``Five-year-old Took Wrong 
Medication for Two Months.'' Brady, E. and McCoy, K., 2/12/08)
    The HHS projects that medication errors alone cost the health care 
system $76 billion per year (Yasnoff). For example, one of the most 
common errors in medication use history occurs when a patient or other 
caregiver forgets to tell a physician or nurse about a medication that 
is taken at home; a computerized physician order entry system cannot 
detect this omission without linkage to a community pharmacy database, 
which could integrate the patient's medication history with the 
physician's electronic record for that patient. This all points to the 
need for a unified EHR to serve as a single source of comprehensive 
clinical information across settings.
    By having patient data, including laboratory and radiographic 
results, instantly available to the patient and any provider of the 
patient's choice via an interconnected network, HIT improves the 
ability of health care professionals and patients to make more informed 
decisions and avoid providing duplicative and redundant services. 
Furthermore, reconciliation of medications will decrease the likelihood 
of omission errors when medications are included in a unified EHR. 
Thus, errors of omission and commission can be prevented; both 
resulting in savings and, even more importantly, enhanced patient 
safety.
    HLC member companies have already demonstrated that medical errors 
can be reduced by deploying proven technologies, including bedside bar-
coded medication administration systems, widespread e-prescribing, and 
secure online, ``anytime, anywhere'' access for physicians to critical 
patient medication information.
    Widely-implemented, interoperable and effectively utilized HIT also 
maintains the capability to improve population health by enabling 
advances in critical, oftentimes lifesaving, efforts. For example, data 
which could assist in early detection of a bioterrorism event include 
many categories of information, much of which would be derived from 
hospital computer systems, clinical laboratories, electronic health 
record systems, medical examiner recordkeeping systems, and 911 call 
center computers. Other efforts, such as monitoring the safety of drugs 
and devices through post-market safety surveillance, as well as linking 
interoperable standards to health care quality reporting efforts, are 
an important means to improving quality and value in our health care 
system.
    Pressure is mounting for reform of current payment policy to 
encourage quality improvement, transparency and efficiency. 
Consequently, there is a growing need to measure the efficacy and 
efficiency of health care delivery. HLC believes the health care 
delivery system needs rapid adoption of HIT interoperability standards 
that not only facilitate the clinical management of an individual 
patient but that also support the ready aggregation of data for quality 
and safety measurement and reporting.
    Currently, most EHRs cannot transmit quality data for reporting. As 
a result, hospitals must use a manual and resource intensive process to 
report mandatory quality data. It is not uncommon to see a nurse 
reviewing a patient record in an EHR, writing down the information 
needed and then entering that information into a quality reporting tool 
because there is no way to automatically extract the required data from 
the EHR to feed the quality reporting tool. To alleviate this problem, 
the Federal Government should require the adoption of transaction and 
semantic interoperability standards for the storage and transmission of 
data captured within EHRs. Further, the standard-format data captured 
in EHRs should be readily accessible to be transmitted to quality 
reporting systems.
    Lastly, there is growing interest in comparative effectiveness 
research and evidence-based medicine to assist providers in evaluating 
the best care for patients. A well-functioning HIT system would be a 
crucial component of disseminating comparative effectiveness 
information to providers at the point of care. HIT tools such as 
Clinical Decision Support help providers gain easier access to the most 
current practice guidelines and evidence-based medicine information 
during patient encounters. Furthermore, initiatives aimed at chronic 
disease management are much more easily facilitated by an automated 
health care system.
                federal funding to spur adoption of hit
    Given the benefits of HIT to the Nation's health care system, HLC 
believes that it is critical that the Federal Government invest funds 
to promote the widespread implementation of HIT.
    Though some providers have begun the transition to electronic 
medical records (EMR), most medical records are still stored on paper. 
The United States lags behind many other countries in its use of EMRs. 
Only 15 to 20 percent of U.S. physician offices and 20 to 25 percent of 
hospitals have adopted some version of an EMR system, and the majority 
of these systems can't effectively interconnect through networks to 
coordinate care with other health care providers. (RAND)
    In 2003, HLC established a Technical Advisory Board, comprised of 
clinicians and others with information technology expertise within HLC 
and other organizations, to provide insights regarding their HIT 
implementation experiences. In this and other more recent surveys, the 
high cost of HIT systems is repeatedly cited as a barrier to effective 
implementation. In addition to the front-end cost of investment, there 
are significant initial and ongoing maintenance and operational costs 
for HIT, including software, hardware, training, upgrades, and 
maintenance. Systems are virtually unaffordable for those providers who 
do not have ready access to the operating capital needed for such an 
investment. This reality is especially prevalent among rural providers, 
who are most likely to need help overcoming the financial and 
workforce-based barriers to connecting their practices to a nationwide 
system.
    To date, while there has been considerable discussion and desire to 
enact legislation that would provide this much-needed capital, Congress 
has yet to complete action. Investing in HIT through an economic 
recovery package will help lead the way toward a ``recovery'' of our 
Nation's health care system. HLC believes that the Federal Government 
should provide a robust impetus to the Nation's implementation of HIT 
through financial incentives and funding mechanisms to help providers 
defray the huge costs of acquiring and operating HIT. Congress has 
significant interest in doing so both as a major payer of health care, 
through the Medicare, Federal Employee Health Benefits Program, and 
other Federal programs, and to further the quality of the Nation's 
health at-large. For example, as evidenced during natural disasters 
such as Hurricane Katrina, interoperable HIT is a critical component to 
successful public health responses during emergency situations.
    While grants and contracts from the Agency for Healthcare Research 
and Quality (AHRQ) and the Office of the National Coordinator for 
Health Information Technology (ONCHIT) help to support the development 
of a national information network, we need to do more to get every 
provider using electronic health records now.
    HLC advocates the implementation of multiple HIT funding 
mechanisms. These could include:

     payment rewards or ``add-ons'' for health care services 
administered in conjunction with the use of HIT;
     a revolving low-interest loan fund with debt forgiveness 
in accordance with specified criteria, such as long-term savings to the 
Medicare trust fund
     tax incentives for physicians, hospitals, and other health 
care entities;
     reimbursement incentives based on improved patient 
outcomes;
     matching private funds with public funds through grants 
from the HHS; and
     revising the exceptions to the physician self-referral 
(Stark) and anti-kickback rules that allow hospitals to share their HIT 
investment with physicians.

    We look forward to working with the committee to determine how 
Congress might best be able to assist in this regard.
    It is important to note that funding initiatives need not be 
limited solely to promoting physician uptake of EHRs. HIT systems such 
as safe medication technologies, e-prescribing, telemedine, and 
educational and training initiatives will all need to be part of a 
successful strategy to digitize our health system. Expanded funding 
directed not only to physicians and hospitals, but also to other health 
care professionals who touch all aspects of the delivery of care 
supports a tangible move from reactive, episodic care to a fully-
integrated continuum of care.
             national standards to insure interoperability
    In the area of standards, several public and private sector 
initiatives are making great strides in identifying and developing HIT 
interoperability standards that will enable disparate systems to 
``speak the same language.'' The Health Information Technology 
Standards Panel (HITSP) has made considerable progress testing these 
standards, and the work of the Certification Commission for Health 
Information Technology (CCHIT) complements these efforts by certifying 
that products are compliant with criteria for functionality, 
interoperability and security. This will help reduce provider 
investment risks and improve user satisfaction.
    Aside from cost, providers also routinely express concerns that 
systems they choose to purchase now could become second-rate or 
obsolete. Continuing the standards development and certification work 
that is already in progress can help assure them that systems they 
adopt now can be easily upgraded to facilitate ongoing 
interoperability.
    HLC believes, first and foremost, that in setting national 
standards to ensure interoperability, we must also continue to 
encourage innovation in the field of standards development. We firmly 
believe that the private sector should work collectively to develop a 
roadmap for effective health information exchange that specifies the 
priorities and the standards necessary to make such an exchange 
possible. The newly announced National eHealth Collaborative, formerly 
the AHIC Successor, is poised to continue the important work that the 
American Health Information Community started. Such standards will 
foster smooth and efficient communications and cooperation, regardless 
of individual system structure or architecture. Among other things, 
this work should address the increasing need for data, connectivity, 
interface, and communications standards. The health care industry also 
needs standards for commonly accepted clinical definitions, vocabulary, 
and terminology. Currently, a great deal of data goes into systems, but 
little automatically comes out in a way that readily supports health 
care providers and researchers.
    While it may seem appropriate to write standards-setting into 
statute, care should be taken to assure that existing activities are 
not duplicated or hampered by new efforts. The Federal Government can 
assist these activities by ensuring that all interested stakeholders 
are seated at these collaboratives (including those representing public 
entities) and that standards being developed align with the policy 
goals for national HIT. Harmonized technical standards to facilitate 
reporting quality measures, for example, would be one such requirement.
                                privacy
    With the development of electronic data exchange comes renewed 
concern over the privacy and security of health information. HLC has a 
longstanding involvement in the debate over health privacy and, through 
its chairing of the Confidentiality Coalition, played an integral role 
in the promulgation of the Health Insurance Portability and 
Accountability Act (HIPAA) Privacy and Security rules.
    HLC strongly believes that engendering patient and consumer trust 
in EHR and other applications will be paramount to successful 
implementation of HIT. Thus, we continue to advocate for a balanced, 
consensus-driven approach to setting privacy policy as it relates to 
HIT. We recognize that, as we move towards widespread use of HIT, some 
aspects of the HIPAA Privacy Rule will need to be updated to meet these 
emerging privacy and security concerns. For example, meaningful 
notification of privacy or security breaches is an important 
improvement necessary to protect individuals whose identifiable health 
information has been compromised. We also have proposed that holders of 
personal health information not covered under HIPAA be held accountable 
to equitable and enforceable privacy standards.
    Developing a multi-state, interoperable system depends not only on 
national technical standards but also on national uniform standards for 
confidentiality and security. Because the HIPAA Privacy Rule's 
preemption standard permits significant State variation, providers, 
clearinghouses and health plans are required to comply with the Federal 
law as well as many State privacy restrictions that differ to some 
degree from the Federal HIPAA Privacy Rule.
    We believe congressional action to establish a uniform Federal 
privacy standard is vital in order to ensure the viability of a 
national health information network. State health privacy protections 
vary widely and are found in thousands of statutes, regulations, common 
law principles and advisories. Health information privacy protections 
can be found in a State's health code as well as its laws and 
regulations governing criminal procedure, social welfare, domestic 
relations, evidence, public health, revenue and taxation, human 
resources, consumer affairs, probate and many others. Virtually no 
State requirement is identical to the Federal rule.
    Addressing this issue appropriately will be essential to achieving 
the interoperability necessary to improve the quality and cost 
effectiveness of the health care system--while still assuring patients' 
confidence that their information will be kept private.
                               conclusion
    In looking at the original HIT recommendations that HLC developed 
and issued in 2004, it is clear that there has been progress since that 
time.
    Legislation to facilitate greater adoption of HIT enjoys bipartisan 
support and continues to gain momentum. Senate action in the past 2 
years suggests that we are close to reaching consensus on the details 
surrounding HIT policy, such as standard setting and privacy and 
security policy. We believe that legislation that would begin to build 
an HIT infrastructure offers Congress a clear and important opportunity 
to improve our health care system. By creating a dedicated funding 
source and facilitating the development, adoption, and use of 
interoperable standards, legislation can focus on areas in which 
Congress must act to remove barriers to widespread adoption.
    HIT expansion alone will not enable us to close the gap between the 
health care system we have today and the one we are capable of 
achieving. We all agree that we need reforms to achieve greater quality 
for patients and value for our dollar. The electronic exchange of 
health information will be crucial to long-term goals to overhaul our 
health care system. Working to build a virtual HIT infrastructure today 
will pay dividends over the long-term in the form of healthier 
Americans, safer care, and lower costs. For that reason, including 
significant funding in the economic recovery package to assist 
providers and others to adopt HIT would serve as an important down 
payment on the future of our Nation's health and long-term economic 
sustainability.
    The Healthcare Leadership Council appreciates this opportunity to 
testify on HIT. Any questions about my testimony or these issues can be 
addressed to me or to Ms. Tina Grande, Senior Vice President for 
Policy, Healthcare Leadership Council (telephone 202-452-8700, e-mail 
[email protected]).
                                 ______
                                 
  Attachment 1.--Examples of HLC Member Organizations' Successes with 
                     Health Information Technology
     Aetna's ActiveHealth CareEngine(r)-powered personal health 
record (PHR) helps over 8 million members manage and organize their 
health data so that they can work with their physicians to make 
informed decisions. Aetna will make this tool available to more members 
by the end of 2009. Aetna has also partnered with RxHub and the 
National e-Prescribing Patient Safety Initiative (NEPSI) to improve 
physician access to decision-support information and e-prescribing 
technology.
    Aetna was the first health insurer and one of the first employers 
to sign the statement of support for the Department of Health and Human 
Services' ``Four Cornerstones of Value-Driven Health Care,'' which 
calls for the development and use of HIT, as well as tools that provide 
quality and pricing information to consumers. To that end, Aetna has 
developed an innovative price and clinical quality transparency program 
to provide members with doctor and facility specific information.
    Aetna is one of the Nation's leaders in health care, dental, 
pharmacy, group life, and disability insurance, and employee benefits. 
They are one of the Nation's leading diversified health care benefits 
companies, serving approximately 37.2 million people with information 
and resources to help them make better informed decisions about their 
health care.
     Amerinet is a group purchasing organization that promotes 
quality health care delivery and helps all types of providers more 
effectively manage expenses. They specialize in solutions related to 
technology, clinical operations, data management, executive-level 
decisions, and supply chain management.
    An Amerinet member, the Virginia Mason (VM) Medical Center, is a 
private, non-profit organization that offers a system of integrated 
health services made possible through its large, multispecialty group 
practice of more than 480 physicians. Virginia Mason has been testing 
telemedicine services in rural areas throughout Washington State and 
Alaska for over 10 years, including a live, interactive video feed 
between VM and other remote clinics in the Pacific Northwest. This 
capability allows them to provide real-time information and store-and-
forward communications related to a variety of medical fields, 
including radiology, dermatology, cardiology, and others, to a region 
that has been identified as lacking a sufficient health professional 
workforce. VM is able to use this service to transmit radiological 
studies, consult on diagnosis and referral, and conduct pre- and post-
surgical examinations.
     Ascension Health is the Nation's largest Catholic and 
largest nonprofit health system, serving patients through a network of 
hospitals and related health facilities providing acute care services, 
long-term care, community health services, psychiatric, rehabilitation 
and residential care.
    Spearheaded by Ascension Health, the Austin, Texas-based, Indigent 
Care Collaboration (ICC) has demonstrated the effectiveness of HIT in 
improving health care for the uninsured and underinsured. Drawing from 
funding through Federal and foundation grants, this community 
collaborative built I-Care, an integrating information structure 
providing for a shared patient record. This HIT system enables the area 
safety net providers, including hospitals and outpatient clinics and 
health centers, to obtain on a real-time basis a record for each 
patient's previous health care encounter. It also permits the ICC to 
map patients and diagnoses for health care planning and research; 
document, monitor, and manage diseases in the population, and measures 
the effects of policy changes on populations in the local region. In 
addition to improving the health and lives of vulnerable patients, ICC 
has become a self-sustaining business model upon which other 
communities can draw for expertise and inspiration.
     BlueCross BlueShield of Tennessee is an independent, not-
for-profit, locally governed health plan company that provides health 
insurance benefits to Tennessee business customers and plan members.
    SharedHealth, an independent subsidiary of BlueCross BlueShield of 
Tennessee, is the largest public-private electronic health information 
exchange in the United States and has made TennCare the only Medicaid 
program in the country to convert all its beneficiaries to an 
electronic health record application at the point of care.
    By replacing paper-based systems with advanced technologies, 
TennCare effectively links authorized clinicians and patients with 
secure, up-to-date information at the point of care via an encrypted 
web-based system, including previous medical visits, service 
utilization, lab results, medications, allergies, and immunizations. 
The system also allows physicians to e-prescribe and will soon have 
additional function-
ality related to chronic care management.
    Recent third-party studies have indicated that consistent 
utilization of SharedHealth increases clinician efficiency by 17%, 
resulting in savings of approximately $59 per episode of care and $9 
per medication prescribed electronically.
     Hospira is a global specialty pharmaceutical and 
medication delivery company dedicated to Advancing WellnessTM by 
developing, manufacturing and marketing products that help improve the 
productivity, safety and efficacy of patient care. To meet the needs of 
hospitals working to minimize errors, adhere to the best clinical 
practices, maintain continuity of care standards and fully utilize 
infusion devices, Hospira developed Hospira MedNet Software. Hospira 
MedNet Software is a server-based suite of applications designed to 
connect data from a hospital's drug information library to infusion 
devices throughout the hospital to monitor, control and provide reports 
at the device, group or systemwide levels.
    The adoption by hospitals of ``smart pumps,'' infusion pumps with 
safety software, helps to prevent medication errors at the patient's 
bedside. The system helps hospitals define medication dose limits and 
track intravenous drug delivery to help prevent errors. It involves 
hospital pharmacists with the rest of the hospital team to develop and 
program best-practice dose recommendations for the infusion of drugs 
into a database that can then be transferred to the pump. HLC members, 
Cardinal Health and Baxter International, also manufacture similar 
devices.
     The Marshfield Clinic is one of the largest private, 
multispecialty group practices in the United States today and includes 
over 750 physicians in 84 medical specialties and subspecialties 
located in over 40 centers throughout northern, central and western 
Wisconsin. Although Marshfield Clinic has become synonymous with the 
city of Marshfield, Wisconsin, the Clinic's ``community'' goes well 
beyond the immediate area, embracing nearly all of Wisconsin and much 
of Michigan's Upper Peninsula. Patients from every State in the Nation 
and 25 foreign countries were seen in the Clinic system during fiscal 
year 2006.
    As part of its participation in the 3-year CMS Physician Group 
Practice (PGP) Demonstration, Marshfield Clinic has relied on 
substantial investments made in tools such as their long-established 
telemedicine initiative and an EHR. Using the data in the EHR at the 
point of care ultimately allowed clinicians to deliver higher quality 
care at a more efficient rate. CMS recently announced that Marshfield 
was successful over the first-year of the project in improving quality 
of care while controlling costs to Medicare.
    Marshfield Clinic has been pioneering integrated computer 
technology for patient care for nearly 20 years. The Clinic is 
chartless as of 2007. Wireless tablet computers allow access to EMRs 
and prescription writing through an advanced electronic prescribing 
program called Medications Manager. Marshfield also employs an 
application called iList that allows providers to quickly identify and 
reach out to patients that have one of three chronic illnesses--
diabetes, heart failure, or hypertension--yet do not meet all of their 
recommended health goals.
     Mayo Clinic is a non-profit medical practice dedicated to 
the diagnosis and treatment of virtually every type of complex illness. 
Mayo provides clinic and hospital services at its locations in 
Rochester, MN; Jacksonville, FL; and Phoenix and Scottsdale, AZ.
    The Automation of the Clinical Practice (ACP) at Mayo Clinic in 
Jacksonville, FL is a project undertaken in 1993 to encompass the 
computer-based patient record with the addition of the mechanisms for 
automated charging and order creation by physicians. This vision was 
crystallized and communicated as the ``paperless'' practice of medicine 
that would increase patient safety and improve physician effectiveness 
while at the same time driving down expenses. The last paper-based 
record was circulated in January 1996 and the integrated outpatient 
practice continues to the present day.
    The Automated Clinical Practice program involves all clinical 
users. The areas that are automated now include most aspects of the 
practice and examples include:

      An electronic medical record (EMR) including all clinical 
documents, orders, scheduling, and laboratory.
      A fully electronic filmless radiology department with 
speech recognition for radiologist documentation.
      An automated Intensive Care Unit with EMR integration and 
bedside medical device interfaces directly to the EMR.
      Inpatient and outpatient surgery areas consisting of 
surgical scheduling, material management, and nursing documentation.

    From this level of automation patient safety initiatives have been 
possible. For example:

      Orders automatically generate task lists for nursing, 
respiratory, etc., in the hospital.
      Automated fall risk assessment and Braden skin scale 
assessment are generated in the hospital.
      A medical data warehouse allows free text searching 
against the entire repository of millions of documents in the EMR for 
patient care and research.
      An infectious disease application allows bioterrorism 
surveillance and automated infection control monitoring.

    Dictating notes shifted work from the physician and improved both 
legibility and medical record turnaround time. The system allowed for 
real time availability of clinical information (notes, Lab, X-ray, and 
other results), automatic checking for duplicate redundant orders, 
simultaneous access to the same patient chart, improved ability to 
answer ad hoc questions for patient calls, more timely response from 
physicians when patients have questions, and improved flow of 
information to the physician enabling him or her to have a more 
``complete'' picture of what is known about the patient's condition at 
the time of the appointment. Savings to the organization have been 
significant.
     McKesson and their subsidiary, McKesson Provider 
Technologies, deliver vital pharmaceuticals, medical supplies, and HIT 
solutions that touch the lives of more than 100 million patients each 
day. McKesson is the world's largest health care services company and a 
leader in wholesale delivery of medicines and health care products.
    Customers of McKesson Provider Technologies, a leader in the 
distribution and deployment of HIT solutions, have demonstrated the 
benefits of implementing HIT firsthand. One hospital that introduced 
bedside bar-code scanning of medications reduced its already-low 
medication error rate by 80 percent and sustained that rate for over 10 
years. Additionally, a clinic in the process of deploying an ambulatory 
EHR and e-prescribing system reduced nurse time spent on charts by 24 
percent and increased time spent with patients by 16 percent. 
Similarly, transitioning to electronic charts at a rural medical center 
cut the average nurse daily paperwork by 1.5 hours. Examples like these 
and many more demonstrate the potential for HIT to improve the quality 
and efficiency of care, allowing clinicians to spend more time and 
resources on providing better care to patients and less time on 
burdensome paperwork.
     Pfizer is the world's largest research-based biomedical 
and pharmaceutical company, with corporate headquarters located in New 
York and major research and development locations in the United States 
and England.
    Since March 2006, Pfizer has been working with a small group of 
other pharmaceutical companies, including other HLC member 
organizations, to evaluate and explore how clinical research could be 
improved by leveraging the National Health Information Network (NHIN) 
and other Health Information Exchanges through an effort called the 
NHIN Slipstream Project. This group explored many important ways that 
the exchange of health information could improve patient health through 
the research, development, and commercialization of new therapies, and 
determined that the three most important areas of initial focus in the 
ONC NHIN process are: post-marketing drug safety surveillance, 
connecting patients to clinical trials, and establishing appropriate 
care standards through outcomes, pharmacoeconomic, and personalized 
medicine research.
    Pfizer has also participated in the Cancer Biomedical Informatics 
Grid (caBIG), a voluntary network individuals and institutions to 
enable the sharing of data and tools related to cancer research. caBIG 
is a partnership between the National Cancer Institute (NCI) and the 
private sector to facilitate integration of clinical information and 
the growing volume of genomic and proteomic data for the purpose of 
advancing development of new therapies. In conjunction with 80 
companies as well as NCI, NIH, and FDA, Pfizer is working on the CRIX 
(Clinical Research Information eXchange) initiative to expand the caBIG 
vision from cancer to other therapeutic areas. caBIG is being built on 
open source, open access, open development, and federation principles.

    Senator Mikulski. Thank you. And just the data that you 
gave on saving--I remember earlier in my own remarks, I said 
quality is about saving lives or improving the delivery of 
service and then saving money. And what you are saying, we 
already have demonstrable evidence that in very specific areas, 
even in so-called e-prescribing, it has had a tremendous 
impact.
    Really, you know, my background is that of a social worker. 
And I love case examples because I think that is when you can 
get the picture of really what is the impact. But in listening 
to Mr. Cochran, what are some of the speed bumps and potholes 
not only in the technology, because we will focus on developing 
the technology. But it is really people--providers, including 
nurses, physician's assistants, diabetic educators who know 
what the doctors told the patient--I think this is what you are 
talking about.
    Because it is a network even among a variety of providers, 
not only M.D. to M.D. Am I correct in that?
    Ms. Grealy. Right.
    Senator Mikulski. Yes, OK.
    Well, now, Ms. Melvin, let us hear from GAO.

STATEMENT OF VALERIE MELVIN, DIRECTOR, INFORMATION TECHNOLOGY, 
   THE GOVERNMENT ACCOUNTABILITY OFFICE (GAO), WASHINGTON, DC

    Ms. Melvin. Thank you, Madam Chairwoman, Senator Merkley.
    I am pleased to be here today to comment on Federal efforts 
to advance the use of health information technology. Properly 
implemented, technology can, as you have noted, help make 
patients' information more readily available to healthcare 
providers, help reduce medical errors, and contribute to 
streamlined administrative functions, all of which could help 
improve the efficiency and the quality of healthcare.
    Yet achieving the transition to a nationwide capability is 
a complex endeavor involving many stakeholders, technologies, 
and activities, and the best way to accomplish this has been 
subject to much debate.
    Over the years, our various reviews of Federal health IT 
initiatives have determined that a successful transition will 
require addressing a range of important issues, as have been 
noted here today, three of which I am highlighting.
    First, clearly defined health IT standards are needed to 
allow different systems to work together and to provide the 
right people access to the information they need. For example, 
technology standards must be agreed on, and a host of content 
issues must be addressed, such as the need for consistent 
medical terminology.
    We previously recommended that HHS build the mechanisms and 
structures for defining such standards, and the National 
Coordinator for Health IT responded by tasking key 
organizations to address this issue. However, while progress 
has been made, continued work on standards initiatives remains 
essential to extend the use of health IT and fully achieve its 
potential benefits.
    Second, because achieving interoperable health IT involves 
many stakeholders, technologies, and activities over an expanse 
of time, it is important that they be guided by comprehensive 
plans that include milestones and performance measures to allow 
the results of activities to be monitored and assessed and 
corrective actions to be taken as needed.
    Yet across our work at HHS and elsewhere, we have seen 
repeated instances in which planning activities have not been 
sufficiently comprehensive. A framework for strategic action 
that the national coordinator released in July 2004 lacked 
these components, and we have noted similar management 
weaknesses in DOD's and VA's health IT efforts.
    Last July, HHS released a new strategic plan. And if the 
milestones and measures contained therein are appropriate and 
properly implemented, this could help to further overall 
progress toward an interoperable health IT infrastructure.
    Finally, a consistent approach to privacy protection is 
needed to help encourage public acceptance and adoption of 
electronic health records. We have identified key privacy 
principles and challenges that this approach would need to 
address, such as obtaining individuals' consent to use and 
disclose their personal health information.
    Although HHS has begun to establish such an approach, more 
is needed, including a process to ensure that key privacy 
principles and challenges we identified are fully and 
adequately addressed.
    Madam Chairwoman, this concludes my prepared statement, and 
I would be happy to respond to your questions.
    [The prepared statement of Ms. Melvin follows:]
                Prepared Statement of Valerie C. Melvin
                               Highlights
                         why gao did this study
    As GAO and others have reported, the use of information technology 
(IT) has enormous potential to help improve the quality of health care 
and is important for improving the performance of the U.S. health care 
system. Given its role in providing health care, the Federal Government 
has been urged to take a leadership role to improve the quality and 
effectiveness of health care, and it has been working to promote the 
nationwide use of health IT for a number of years. However, achieving 
widespread adoption and implementation of health IT has proven 
challenging, and the best way to accomplish this transition remains 
subject to much debate.
    At the committee's request, this testimony discusses important 
issues identified by GAO's work that have broad relevance to the 
successful implementation of health IT to improve the quality of health 
care.
    To develop this testimony, GAO relied largely on its previous work 
on Federal health IT activities.
     Health Information Technology--Federal Agencies' Experiences 
          Demonstrate Challenges to Successful Implementation
                             what gao found
    Health IT has the potential to help improve the efficiency and 
quality of health care, but achieving the transition to a nationwide 
health IT capability is an inherently complex endeavor. A successful 
transition will require, among other things, addressing the following 
issues:

     Establishing a foundation of clearly defined health IT 
standards that are agreed upon by all important stakeholders. 
Developing, coordinating, and agreeing on standards are crucial for 
allowing health IT systems to work together and to provide the right 
people access to the information they need: for example, technology 
standards must be agreed on (such as file types and interchange 
systems), and a host of content issues must also be addressed (one 
example is the need for consistent medical terminology). Although 
important steps have been taken, additional effort is needed to define, 
adopt, and implement such standards to promote data quality and 
consistency, system interoperability (that is, the ability of automated 
systems to share and use information), and information protection.
     Defining comprehensive plans that are grounded in results-
oriented milestones and measures. Using interoperable health IT to 
improve the quality and efficiency of health care is a complex goal 
that involves a range of stakeholders, various technologies, and 
numerous activities taking place over an expanse of time, and it is 
important that these activities be guided by comprehensive plans that 
include milestones and performance measures. Without such plans, it 
will be difficult to ensure that the many activities are coordinated, 
their results monitored, and their outcomes most effectively 
integrated.
     Implementing an approach to protection of personal privacy 
that encourages public acceptance of health IT. A robust approach to 
privacy protection is essential to establish the high degree of public 
confidence and trust needed to encourage widespread adoption of health 
IT and particularly electronic medical records. Health IT programs and 
applications need to address key privacy principles (for example, the 
access principle, which establishes the right of individuals to review 
certain personal health information). At the same time, they need to 
overcome key challenges (for example, those related to variations in 
States' privacy laws). Unless these principles and challenges are fully 
and adequately addressed, there is reduced assurance that privacy 
protection measures will be consistently built into health IT programs 
and applications, and public acceptance of health IT may be put at 
risk.
                                 ______
                                 
    Mr. Chairman and members of the committee: I am pleased to be here 
today to comment on Federal efforts to advance the use of health 
information technology (IT). Studies published by the Institute of 
Medicine and others have long indicated that fragmented, disorganized, 
and inaccessible clinical information adversely affects the quality of 
health care and compromises patient safety. Further, long-standing 
problems with medical errors and inefficiencies have contributed to 
increased costs of health care. With health care spending in 2007 
reaching approximately $2.2 trillion, or 16 percent of the U.S. gross 
domestic product, concerns about the costs of health care have 
continued to grow, and have prompted calls from policymakers, industry 
experts, and medical practitioners to improve the U.S. health care 
system.
    As has been recognized by you and other members of Congress, as 
well as President Bush and President-elect Obama, the use of 
information technology to electronically collect, store, retrieve, and 
transfer clinical, administrative, and financial health information has 
great potential to help improve the quality and efficiency of health 
care. The successful implementation of health IT offers promise for 
improving patient safety and reducing inefficiencies and has been shown 
to support cost savings and other benefits. At the same time, 
successfully achieving widespread adoption and implementation of health 
IT has proven challenging, and the best way to accomplish this goal 
remains subject to much debate. According to the Department of Health 
and Human Services (HHS), only a small number of U.S. health care 
providers have fully adopted health IT due to significant financial, 
technical, cultural, and legal barriers, such as a lack of access to 
capital, a lack of data standards, and resistance from health care 
providers.
    Given its role in providing health care, the Federal Government has 
been urged to take a leadership role to improve the quality and 
effectiveness of health care and has been working to promote the 
nationwide use of health IT for a number of years. In April 2004, 
President Bush issued an executive order that called for widespread 
adoption of interoperable electronic health records by 2014,\1\ and 
HHS, in turn, initiated activities to advance the nationwide 
implementation of interoperable health IT. In addition, for the past 
decade, the Departments of Defense (DOD) and Veterans Affairs (VA) have 
been pursuing initiatives to share data between their health 
information systems. In an effort to expedite the exchange of 
electronic health information between the two departments, the National 
Defense Authorization Act for Fiscal Year 2008 \2\ included provisions 
directing the two departments to jointly develop and implement, by 
September 30, 2009, fully interoperable \3\ electronic health record 
systems or capabilities.
---------------------------------------------------------------------------
    \1\ Executive Order 13335, Incentives for the Use of Health 
Information Technology and Establishing the Position of the National 
Health Information Technology Coordinator (Washington, DC: Apr. 27, 
2004).
    \2\ Pub. L. No. 110-181, Sec. 1635 (2008).
    \3\ Interoperability is the ability of two or more systems or 
components to exchange information and to use the information that has 
been exchanged.
---------------------------------------------------------------------------
    Since 2001, we have been reviewing aspects of the various Federal 
efforts undertaken to implement information technology for health care 
and public health solutions. We have reported both on HHS's national 
health IT initiatives as well as on DOD's and VA's electronic health 
information sharing initiatives.\4\ Overall, our studies have 
recognized progress made by these departments, but we have also pointed 
out areas of concern that could jeopardize their success in advancing 
the use of interoperable health IT. At your request, my testimony today 
discusses important issues identified by our work that have broad 
relevance to the successful implementation of health IT to further 
improve the quality of health care.
---------------------------------------------------------------------------
    \4\ GAO, Computer-Based Patient Records: Better Planning and 
Oversight by VA, DOD, and IHS Would Enhance Health Data Sharing, GAO-
01-459 (Washington, DC: Apr. 30, 2001); Computer-Based Patient Records: 
VA and DOD Efforts to Exchange Health Data Could Benefit from Improved 
Planning and Project Management, GAO-04-687 (Washington, DC: June 7, 
2004); Health Information Technology: HHS Is Taking Steps to Develop a 
National Strategy, GAO-05-628 (Washington, DC: May 27, 2005); Health 
Information Technology: HHS is Continuing Efforts to Define its 
National Strategy, GAO-06-1071T (Washington, DC: Sept. 1, 2006); 
Information Technology: DOD and VA Have Increased Their Sharing of 
Health Information, but More Work Remains, GAO-08-954 (Washington, DC: 
July 28, 2008); Health Information Technology: HHS Has Taken Important 
Steps to Address Privacy Principles and Challenges, Although More Work 
Remains, GAO-08-1138 (Washington, DC: Sept. 17, 2008); and Electronic 
Health Records: DOD and VA Have Increased Their Sharing of Health 
Information, but Further Actions Are Needed, GAO-08-1158T (Washington, 
DC: Sept. 24, 2008).
---------------------------------------------------------------------------
    In developing this testimony, we relied largely on our previous 
work. We conducted our work in support of this testimony between 
December 2008 and January 2009 in Washington, DC. All work on which 
this testimony is based was performed in accordance with generally 
accepted government auditing standards. Those standards require that we 
plan and perform audits to obtain sufficient, appropriate evidence to 
provide a reasonable basis for our findings and conclusions based on 
our audit objectives. We believe that the evidence obtained provides a 
reasonable basis for our findings and conclusions based on our audit 
objectives.
    In summary, transitioning to a nationwide health IT capability is 
an inherently complex endeavor. Achieving this transition and the 
potential efficiencies and quality improvements promised by widespread 
adoption of health IT will require consideration of many serious 
issues, including the need for a foundation of clearly defined health 
IT standards that are agreed upon by all important stakeholders, 
comprehensive planning grounded in results-oriented milestones and 
measures, and an approach to privacy protection that encourages 
acceptance and adoption of electronic health records.
     Developing, coordinating, and agreeing on standards are 
crucial for allowing health IT systems to work together and to provide 
the right people access to the information they need. Any level of 
interoperability depends on the use of agreed-upon standards to ensure 
that information can be shared and used. Developing and implementing 
health IT standards requires structures and ongoing mechanisms that 
include the participation of the relevant stakeholders, in both the 
public and private health care sectors who will be sharing information. 
Although important steps have been taken, additional effort is needed 
to define, adopt, and implement such standards to promote data quality 
and consistency, system interoperability, and information protection.
     Using interoperable health IT to improve the quality and 
efficiency of health care is a complex goal that involves a range of 
stakeholders, various technologies, and numerous activities taking 
place over an expanse of time; in view of this complexity, it is 
important that these activities be guided by comprehensive plans that 
include milestones and performance measures. Milestones and performance 
measures allow the results of the activities to be monitored and 
assessed, so that corrective action can be taken if needed. Without 
comprehensive plans, it will be difficult to ensure that the many 
activities are coordinated, their results monitored, and their outcomes 
integrated.
     An important consideration in health IT is an overall 
approach for protecting the privacy of personal electronic health 
information. The capacity of health information exchange organizations 
to store and manage a large amount of electronic health information 
increases the risk that a breach in security could expose the personal 
health information of numerous individuals. Addressing and mitigating 
this risk is essential to encourage public acceptance of the increased 
use of health IT and electronic medical records. We have identified \5\ 
key privacy principles that health IT programs and applications need to 
address \6\ and key challenges that they need to overcome.\7\ Unless 
these principles and challenges are fully and adequately addressed, 
there is reduced assurance that privacy protection measures will be 
consistently built into health IT programs and applications, and public 
acceptance of health IT may be put at risk.
---------------------------------------------------------------------------
    \5\ GAO, Health Information Technology: Early Efforts Initiated but 
Comprehensive Privacy Approach Needed for National Strategy, GAO-07-238 
(Washington, DC: Jan. 10, 2007).
    \6\ We based these privacy principles on our evaluation of the HHS 
Privacy Rule promulgated under the Administrative Simplification 
provisions of the Health Insurance Portability and Accountability Act 
of 1996 (HIPAA), which define the circumstances under which an 
individual's health information may be used or disclosed. For example, 
the uses and disclosures principle provides, among other things, limits 
to the circumstances in which an individual's protected health 
information may be used or disclosed by covered entities, and the 
access principle establishes individuals' rights to review and obtain a 
copy of their protected health information held in a designated record 
set. For more details, see GAO-07-238.
    \7\ We identified key challenges associated with protecting 
personal health information based on input from selected stakeholders 
in health information exchange organizations. These challenges are 
understanding and resolving legal and policy issues (for example, those 
related to variations in States' privacy laws); ensuring that only the 
minimum amount of information necessary is disclosed to only those 
entities authorized to receive the information; ensuring individuals' 
rights to request access and amendments to their own health 
information; and implementing adequate security measures for protecting 
health information. See GAO-07-238.
---------------------------------------------------------------------------
                               background
    Health care in the United States is a highly decentralized system, 
with stakeholders that include not only the entire population as 
consumers of health care, but also all levels of government, health 
care providers such as medical centers and community hospitals, patient 
advocates, health professionals, major employers, nonprofit health 
organizations, insurance companies, commercial technology providers, 
and others. In this environment, clinical and other health-related 
information is stored in a complex collection of paper files, 
information systems, and organizations, but much of it continues to be 
stored and shared on paper.
    Successfully implementing health IT to replace paper and manual 
processes has been shown to support benefits in both cost savings and 
improved quality of care. For example, we reported to this committee in 
2003 \8\ that a 1,951-bed teaching hospital stated that it had realized 
about $8.6 million in annual savings by replacing outpatient paper 
medical charts with electronic medical records. This hospital also 
reported saving more than $2.8 million annually by replacing its manual 
process for managing medical records with an electronic process to 
provide access to laboratory results and reports. Other technologies, 
such as bar coding of certain human drug and biological product labels, 
have also been shown to save money and reduce medical errors. Health 
care organizations reported that IT contributed other benefits, such as 
shorter hospital stays, faster communication of test results, improved 
management of chronic diseases, and improved accuracy in capturing 
charges associated with diagnostic and procedure codes.
---------------------------------------------------------------------------
    \8\ GAO, Information Technology: Benefits Realized for Selected 
Health Care Functions, GAO-04-224 (Washington, DC: Oct. 31, 2003).
---------------------------------------------------------------------------
    There is also potential benefit from improving and expanding 
existing health IT systems. We have reported that some hospitals are 
expanding their IT systems to support improvements in quality of care. 
In April 2007, \9\ we released a study on the processes used by eight 
hospitals to collect and submit data on their quality of care to HHS's 
Centers for Medicare & Medicaid Services (CMS). Among the hospitals we 
visited, officials noted that having electronic records was an 
advantage for collecting the quality data because electronic records 
were more accessible and legible than paper records, and the electronic 
quality data could also be used for other purposes (such as reminders 
to physicians). Officials at each of the hospitals reported using the 
quality data to make specific changes in their internal procedures 
designed to improve care. However, hospital officials also reported 
several limitations in their existing IT systems that constrained the 
ability to support the collection of their quality data. For example, 
hospitals reported having a mix of paper and electronic systems, having 
data recorded only as unstructured narrative or other text, and having 
multiple systems within a single hospital that could not access each 
other's data. Although it was expected to take several years, all the 
hospitals in our study were working to expand the scope and 
functionality of their IT systems.
---------------------------------------------------------------------------
    \9\ GAO, Hospital Quality Data: HHS Should Specify Steps and Time 
Frame for Using Information Technology to Collect and Submit Data, GAO-
07-320 (Washington, DC: Apr. 25, 2007).
---------------------------------------------------------------------------
    This example illustrates, among other things, that making health 
care information electronically available depends on interoperability--
that is, the ability of two or more systems or components to exchange 
information and to use the information that has been exchanged. This 
capability is important because it allows patients' electronic health 
information to move with them from provider to provider, regardless of 
where the information originated. If electronic health records conform 
to interoperability standards, they can be created, managed, and 
consulted by authorized clinicians and staff across more than one 
health care organization, thus providing patients and their caregivers 
the necessary information required for optimal care. (Paper-based 
health records--if available--also provide necessary information, but 
unlike electronic health records, do not provide automated decision 
support capabilities, such as alerts about a particular patient's 
health, or other advantages of automation.)
    Interoperability may be achieved at different levels (see fig. 1). 
For example, at the highest level, electronic data are computable (that 
is, in a format that a computer can understand and act on to, for 
example, provide alerts to clinicians on drug allergies). At a lower 
level, electronic data are structured and viewable, but not computable. 
The value of data at this level is that they are structured so that 
data of interest to users are easier to find. At still a lower level, 
electronic data are unstructured and viewable, but not computable. With 
unstructured electronic data, a user would have to find needed or 
relevant information by searching uncategorized data.


    It is important to note that not all data require the same level of 
interoperability. For example, computable pharmacy and drug allergy 
data would allow automated alerts to help medical personnel avoid 
administering inappropriate drugs. On the other hand, for such 
narrative data as clinical notes, unstructured, viewable data may be 
sufficient. Achieving even a minimal level of electronic 
interoperability would potentially make relevant information available 
to clinicians.
    Any level of interoperability depends on the use of agreed-upon 
standards to ensure that information can be shared and used. In the 
health IT field, standards may govern areas ranging from technical 
issues, such as file types and interchange systems, to content issues, 
such as medical terminology.
     For example, vocabulary standards provide common 
definitions and codes for medical terms and determine how information 
will be documented for diagnoses and procedures. These standards are 
intended to lead to consistent descriptions of a patient's medical 
condition by all practitioners. The use of common terminology helps in 
the clinical care delivery process, enables consistent data analysis 
from organization to organization, and facilitates transmission of 
information. Without such standards, the terms used to describe the 
same diagnoses and procedures may vary (the condition known as 
hepatitis, for example, may be described as a liver inflammation). The 
use of different terms to indicate the same condition or treatment 
complicates retrieval and reduces the reliability and consistency of 
data.
     Another example is messaging standards, which establish 
the order and sequence of data during transmission and provide for the 
uniform and predictable electronic exchange of data. These standards 
dictate the segments in a specific medical transmission. For example, 
they might require the first segment to include the patient's name, 
hospital number, and birth date. A series of subsequent segments might 
transmit the results of a complete blood count, dictating one result 
(e.g., iron content) per segment. Messaging standards can be adopted to 
enable intelligible communication between organizations via the 
Internet or some other communications pathway. Without them, the 
interoperability of health IT systems may be limited, reducing the data 
that can be shared.
    Developing interoperability standards requires the participation of 
the relevant stakeholders who will be sharing information. In the case 
of health IT, stakeholders include both the public and private sectors. 
The public health system is made up of the Federal, State, tribal, and 
local agencies that may deliver health care services to the population 
and monitor its health. Private health system participants include 
hospitals, physicians, pharmacies, nursing homes, and other 
organizations that deliver health care services to individual patients, 
as well as multiple vendors that provide health IT solutions.
    Federal Health IT Efforts Highlight Importance of Establishing 
    Standards, Developing Comprehensive Plans, and Ensuring Privacy
    Widespread adoption of health IT has the potential to improve the 
efficiency and quality of health care. However, transitioning to this 
capability is a challenging endeavor that requires attention to many 
important considerations. Among these are mechanisms to establish 
clearly defined health IT standards that are agreed upon by all 
important stakeholders, comprehensive planning grounded in results-
oriented milestones and measures, and an approach to privacy protection 
that encourages acceptance and adoption of electronic health records. 
Attempting to expand the use of health IT without fully addressing 
these issues would put at risk the ultimate goal of achieving more 
effective health care.
 mechanisms and structures for harmonizing and implementing health it 
           standards are essential to enable interoperability
    The need for health care standards has been broadly recognized for 
a number of years. In previous work, we identified lessons learned by 
U.S. agencies and by other countries from their experiences. Among 
other lessons, they reported the need to define and adopt common 
standards and terminology to achieve data quality and consistency, 
system interoperability, and information protection.\10\ In May 2003, 
we reported that Federal agencies recognized the need for health care 
standards and were making efforts to strengthen and increase their 
use.\11\ However, while they had made progress in defining standards, 
they had not met challenges in identifying and implementing standards 
necessary to support interoperability across the health care sector. We 
stated that until these challenges were addressed, agencies risked 
promulgating piecemeal and disparate systems unable to exchange data 
with each other when needed. We recommended that the Secretary of HHS 
define activities for ensuring that the various standards-setting 
organizations coordinate their efforts and reach further consensus on 
the definition and use of standards; establish milestones for defining 
and implementing standards; and create a mechanism to monitor the 
implementation of standards through the health care industry.
---------------------------------------------------------------------------
    \10\ GAO, Health Information Technology: HHS Is Taking Steps to 
Develop a National Strategy, GAO-05-628 (Washington, DC: May 27, 2005).
    \11\ GAO, Bioterrofism: Information Technology Strategy Could 
Strengthen Federal Agencies' Abilities to Respond to Public Health 
Emergencies, GAO-03-139 (Washington, DC: May 30, 2003).
---------------------------------------------------------------------------
    HHS implemented this recommendation through the activities of the 
Office of the National Coordinator for Health Information Technology 
(established within HHS in April 2004). Through the Office of the 
National Coordinator, HHS designated three primary organizations, made 
up of stakeholders from both the public and private health care 
sectors, to play major roles in identifying and implementing standards 
and expanding the implementation of health IT:

     The American Health Information Community (now known as 
the National eHealth Collaborative) was created by the Secretary of HHS 
to make recommendations on how to accelerate the development and 
adoption of health IT, including advancing interoperability, 
identifying health IT standards, advancing nationwide health 
information exchange, and protecting personal health information. 
Created in September 2005 as a Federal advisory commission, the 
organization recently became a nonprofit membership organization. It 
includes representatives from both the public and private sectors, 
including high-level officials of VA and other Federal and State 
agencies, as well as health systems, payers, health professionals, 
medical centers, community hospitals, patient advocates, major 
employers, nonprofit health organizations, commercial technology 
providers, and others. Among other things, the organization has 
identified health care areas of high priority and developed ``use 
cases'' for these areas (use cases are descriptions of events or 
scenarios, such as Public Health Case Reporting, that provide the 
context in which standards would be applicable, detailing what needs to 
be done to achieve a specific mission or goal).
     The Healthcare Information Technology Standards Panel 
(HITSP), sponsored by the American National Standards Institute \12\ 
and funded by the Office of the National Coordinator, was established 
in October 2005 as a public-private partnership to identify competing 
standards for the use cases developed by the American Health 
Information Community and to ``harmonize'' the standards.\13\ As of 
March 2008, nearly 400 organizations \14\ representing consumers, 
healthcare providers, public health agencies, government agencies, 
standards developing organizations, and other stakeholders were 
participating in the panel and its committees. The panel also develops 
the interoperability specifications that are needed for implementing 
the standards. In collaboration with the National Institute for 
Standards and Technology, HITSP selected initial standards to address, 
among other things, requirements for message and document formats and 
for technical networking. Federal agencies that administer or sponsor 
Federal health programs are now required to implement these standards, 
in accordance with an August 2006 Executive Order.\15\
---------------------------------------------------------------------------
    \12\ The American National Standards Institute is a private, 
nonprofit organization whose mission is to promote and facilitate 
voluntary consensus standards and ensure their integrity.
    \13\ Harmonization is the process of identifying overlaps and gaps 
in relevant standards and developing recommendations to address these 
overlaps and gaps.
    \14\ Members include representatives from the following sectors: 
clinicians; providers; safety net providers and their representative 
organizations; vendors that develop, market, install, and support 
health IT products; healthcare purchasers or employers; healthcare 
payers or health insurance companies; public health professionals; 
national organizations with a broad representation of stakeholders with 
an interest in healthcare IT standards; clinical and health-services 
researchers' representative organizations; Federal, State, and local 
agencies; coordinating bodies with responsibilities for and/or a 
relationship to healthcare IT used in the public sector; and consumer 
organizations with an interest in health IT standards.
    \15\ Executive Order 13410, Promoting Quality and Efficient Health 
Care in Federal Government Administered or Sponsored Health Care 
Programs (Washington, DC: Aug. 22, 2006).
---------------------------------------------------------------------------
     The Certification Commission for Healthcare Information 
Technology is an independent, nonprofit organization that certifies 
health IT products, such as electronic health records systems. HHS 
entered into a contract with the commission in October 2005 to develop 
and evaluate the certification criteria and inspection process for 
electronic health records. HHS describes certification as the process 
by which vendors' health IT systems are established to meet 
interoperability standards. The certification criteria defined by the 
commission incorporate the interoperability standards and 
specifications defined by HITSP. The results of this effort are 
intended to help encourage health care providers throughout the nation 
to implement electronic health records by giving them assurance that 
the systems will provide needed capabilities (including ensuring 
security and confidentiality) and that the electronic records will work 
with other systems without reprogramming.\16\
---------------------------------------------------------------------------
    \16\ In May 2006, HHS finalized a process and criteria for 
certifying the interoperability of outpatient electronic health records 
and described criteria for future certification requirements. 
Certification criteria for inpatient electronic health records were 
finalized in June 2007. To date, the Certification Commission reports 
that it has certified about 140 products offering electronic health 
records.

    The interconnected work of these organizations to identify and 
promote the implementation of standards is important to the overall 
effort to advance the use of interoperable health IT. For example, 
according to HHS, the HITSP standards are incorporated into the 
National Coordinator's ongoing initiative to enable health care 
entities--such as providers, hospitals, and clinical labs--to exchange 
electronic health information on a nationwide basis. Under this 
initiative, HHS awarded contracts to nine regional and State health 
information exchanges as part of its efforts to provide prototypes of 
nationwide networks of health information exchanges.\17\ Such exchanges 
are intended to eventually form a ``network of networks'' that is to 
produce the envisioned Nationwide Health Information Network (NHIN). 
According to HHS, the department planned to demonstrate the experiences 
and lessons learned from this work in December 2008, including defining 
specifications based upon the work of HITSP and standards development 
organizations to facilitate interoperable data exchange among the 
participants, testing interoperability against these specifications, 
and developing trust agreements among participants to protect the 
information exchanged. HHS plans to place the nationwide health 
information exchange specifications defined by the participating 
organizations, as well as related testing materials, in the public 
domain, so that they can be used by other health information exchange 
organizations to guide their efforts to adopt interoperable health IT.
---------------------------------------------------------------------------
    \17\ These exchanges are intended to connect providers and patients 
from different regions of the country and enable the sharing of 
electronic health information, such as health records and laboratory 
results. DOD, VA, and the Indian Health Service are participating in a 
Federal component of this initiative.
---------------------------------------------------------------------------
    The products of the Federal standards initiatives are also being 
used by DOD and VA in their ongoing efforts to achieve the seamless 
exchange of health information on military personnel and veterans. The 
two departments have committed to the goal of adopting applicable 
current and emerging HITSP standards. According to department 
officials, DOD is also taking steps to ensure compliance with standards 
through certification. To ensure that the electronic health records 
produced by the department's modernized health information system, 
AHLTA,\18\ are compliant with standards, it is arranging for 
certification through the Certification Commission for Healthcare 
Information Technology. Both departments are also participating in the 
National Coordinator's standards initiatives. The involvement of the 
departments in these activities is an important mechanism for aligning 
their electronic health records with emerging Federal standards.
---------------------------------------------------------------------------
    \18\ AHLTA originally was an acronym for Armed Forces Health 
Longitudinal Technology Application. The department no longer considers 
AHLTA an acronym but the official name of the system.
---------------------------------------------------------------------------
    Federal efforts to implement health IT standards are ongoing and 
some progress has been made. However, until agencies are able to 
demonstrate interoperable health information exchange between 
stakeholders on a broader level, the overall effectiveness of their 
efforts will remain unclear. In this regard, continued work on 
standards initiatives will remain essential for extending the use of 
health IT and fully achieving its potential benefits, particularly as 
both information technology and medicine advance.
    comprehensive planning with milestones and performance measures 
               is essential to achieving health it goals
    Using interoperable health IT to help improve the efficiency and 
quality of health care is a complex goal that involves a range of 
stakeholders and numerous activities taking place over an expanse of 
time; in view of this complexity, it is important to develop 
comprehensive plans that are grounded in results-oriented milestones 
and performance measures. Without comprehensive plans, it is difficult 
to coordinate the many activities under way and integrate their 
outcomes. Milestones and performance measures allow the results of the 
activities to be monitored and assessed, so that corrective action can 
be taken if needed.
    Since it was established in 2004, the Office of the National 
Coordinator has pursued a number of health IT initiatives (some of 
which we described above), aimed at the expansion of electronic health 
records, identification of interoperability standards, advancement of 
nationwide health information exchange, and protection of personal 
health information.\19\ It also developed a framework for strategic 
action for achieving an interoperable national infrastructure for 
health IT, which was released in 2004. We have noted accomplishments 
resulting from these various initiatives, but we also observed that the 
strategic framework did not include the detailed plans, milestones, and 
performance measures needed to ensure that the department integrated 
the outcomes of its various health IT initiatives and met its overall 
goals.\20\ Given the many activities to be coordinated and the many 
stakeholders involved, we recommended in May 2005 that HHS define a 
national strategy for health IT that would include the necessary 
detailed plans, milestones, and performance measures, which are 
essential to help ensure progress toward the President's goal for most 
Americans to have access to interoperable electronic health records by 
2014. The department agreed with our recommendation, and in June 2008 
it released a 4-year strategic plan. If the plan's milestones and 
measures for achieving an interoperable nationwide infrastructure for 
health IT are appropriate and properly implemented, the plan could help 
ensure that HHS's various health IT initiatives are integrated and 
provide a useful roadmap to support the goal of widespread adoption of 
interoperable electronic health records.\21\
---------------------------------------------------------------------------
    \19\ In prior work, we described programs that other divisions 
within HHS, such as the Agency for Healthcare Research and Quality and 
the Health Resources and Services Administration, administer to provide 
funding to organizations engaged in building and testing health IT 
systems, standards, and projects. See GAO-05-628 for a description of 
these activities.
    \20\ GAO, Health Information Technology: HHS is Taking Steps to 
Develop a National Strategy, GAO-05-628 (Washington, DC: May 27, 2005).
    \21\ In another example, as a result of the 2007 study of hospital 
quality data collection mentioned earlier, we recommended that the 
Secretary of HHS identify the specific steps that the department 
planned to take to promote the use of health IT for the collection and 
submission of these data, and that it inform interested parties of 
those steps and the expected timeframe, including milestones for 
completing them.
---------------------------------------------------------------------------
    Across our health IT work at HHS and elsewhere, we have seen other 
instances in which planning activities have not been sufficiently 
comprehensive. An example is the experience of DOD and VA, which have 
faced considerable challenges in project planning and management in the 
course of their work on the seamless exchange of electronic health 
information. As far back as 2001 and 2002, we noted management 
weaknesses, such as inadequate accountability and poor planning and 
oversight, and recommended that the departments apply principles of 
sound project management.\22\ The departments' efforts to meet the 
recent requirements of the National Defense Authorization Act for 
Fiscal Year 2008 provide additional examples of such challenges, 
raising concerns regarding their ability to meet the September 2009 
deadline for developing and implementing interoperable electronic 
health record systems or capabilities. In July 2008, we identified 
steps that the departments had taken to establish an interagency 
program office and implementation plan, as required. According to the 
departments, they intended the program office to play a crucial role in 
accelerating efforts to achieve electronic health records and 
capabilities that allow for full interoperability, and they had 
appointed an Acting Director from DOD and an Acting Deputy Director 
from VA. According to the Acting Director, the departments also have 
detailed staff and provided temporary space and equipment to a 
transition team. However, the newly established program office was not 
expected to be fully operational until the end of 2008--allowing the 
departments at most 9 months to meet the deadline for full 
interoperability.
---------------------------------------------------------------------------
    \22\ GAO, Computer-Based Patient Records: Better Planning and 
Oversight by VA, DOD, and IHS Would Enhance Health Data Sharing, GAO-
01-459 (Washington, DC: Apr. 30, 2001) and Veterans Affairs: Sustained 
Management Attention is Key to Achieving Information Technology 
Results, GAO-02-703 (Washington, DC: June 12, 2002).
---------------------------------------------------------------------------
    Further, we reported other planning and management weaknesses. For 
example, the departments developed a DOD/VA Information 
Interoperability Plan in September 2008, which is intended to address 
interoperability issues and define tasks required to guide the 
development and implementation of an interoperable electronic health 
record capability. Although the plan included milestones and schedules, 
it was lacking many milestones for completing the activities defined in 
the plan. Accordingly, we recommended that the departments give 
priority to fully establishing the interagency program office and 
finalizing the implementation plan. Without an effective plan and a 
program office to ensure its implementation, the risk is increased that 
the two departments will not be able to meet the September 2009 
deadline.
 establishing a consistent approach to privacy protection is essential 
          for encouraging acceptance and adoption of health it
    As the use of electronic health information exchange increases, so 
does the need to protect personal health information from inappropriate 
disclosure. The capacity of health information exchange organizations 
to store and manage a large amount of electronic health information 
increases the risk that a breach in security could expose the personal 
health information of numerous individuals. Addressing and mitigating 
this risk is essential to encourage public acceptance of the increased 
use of health IT and electronic medical records.
    Recognizing the importance of privacy protection, HHS included 
security and privacy measures in its 2004 framework for strategic 
action, and in September 2005, it awarded a contract to the Health 
Information Security and Privacy Collaboration as part of its efforts 
to provide a nationwide synthesis of information to inform privacy and 
security policymaking at Federal, State, and local levels. The 
collaboration selected 33 States and Puerto Rico as locations in which 
to perform assessments of organization-level privacy- and security-
related policies and practices that affect interoperable electronic 
health information exchange and their bases, including laws and 
regulations. As a result of this work, HHS developed and made available 
to the public a toolkit to guide health information exchange 
organizations in conducting assessments of business practices, 
policies, and State laws that govern the privacy and security of health 
information exchange.\23\
---------------------------------------------------------------------------
    \23\ In June 2007, HHS reported the outcomes of its privacy and 
security solutions contract based on the work of 34 States and 
territories that participated in the contract. A final summary report 
described variations among organization-level business practices, 
policies, and laws for protecting health information that could affect 
organizations' abilities to exchange data.
---------------------------------------------------------------------------
    However, we reported in January 2007 that HHS initiated these and 
other important privacy-related efforts \24\ without first defining an 
overall approach for protecting privacy. In our report, we identified 
key privacy principles and challenges to protecting electronic personal 
health information.
---------------------------------------------------------------------------
    \24\ Our January 2007 report (GAO-07-238) describes various 
privacy-related efforts incorporated into HHS's overall health IT 
initiative, including the activities of the American Health Information 
Community, the Healthcare Information Technical Standards Panel, the 
Certification Commission for Healthcare IT, and the Nationwide Health 
Information.
---------------------------------------------------------------------------
     Examples of principles that health IT programs and 
applications need to address include the uses and disclosures 
principle, which provides limits to the circumstances in which an 
individual's protected heath information may be used or disclosed, and 
the access principle, which establishes individuals' rights to review 
and obtain a copy of their protected health information in certain 
circumstances.\25\
---------------------------------------------------------------------------
    \25\ We based these privacy principles on our evaluation of the HHS 
Privacy Rule promulgated under the Administrative Simplification 
provisions of the Health Insurance Portability and Accountability Act 
of 1996 (HIPAA), which define the circumstances under which an 
individual's health information may be used or disclosed.
---------------------------------------------------------------------------
     Key challenges include understanding and resolving legal 
and policy issues (for example, those related to variations in States' 
privacy laws), ensuring that only the minimum amount of information 
necessary is disclosed to only those entities authorized to receive the 
information, ensuring individuals' rights to request access and 
amendments to their own health information, and implementing adequate 
security measures for protecting health information.\26\
---------------------------------------------------------------------------
    \26\ We identified key challenges associated with protecting 
personal health information based on input from selected stakeholders 
in health information exchange organizations.
---------------------------------------------------------------------------
    We recommended that HHS define and implement an overall privacy 
approach that identifies milestones for integrating the outcomes of its 
privacy-related initiatives, ensures that key privacy principles are 
fully addressed, and addresses challenges associated with the 
nationwide exchange of health information.
    In September 2008, we reported that HHS had begun to establish an 
overall approach for protecting the privacy of personal electronic 
health information--for example, it had identified milestones and an 
entity responsible for integrating the outcomes of its many privacy-
related initiatives.\27\ Further, the Federal health IT strategic plan 
released in June 2008 includes privacy and security objectives along 
with strategies and target dates for achieving them.
---------------------------------------------------------------------------
    \27\ GAO, Health Information Technology: HHS Has Taken Important 
Steps to Address Privacy Principles and Challenges, Although More Work 
Remains, GAO-08-1138 (Washington, DC: Sept. 17, 2008).
---------------------------------------------------------------------------
    However, in our view, more actions are needed. Specifically, within 
its approach, the department had not defined a process to ensure that 
the key privacy principles and challenges we had identified were fully 
and adequately addressed. This process should include, for example, 
steps for ensuring that all stakeholders' contributions to defining 
privacy-related activities are appropriately considered and that 
individual inputs to the privacy framework are effectively assessed and 
prioritized to achieve comprehensive coverage of all key privacy 
principles and challenges. Without such a process, stakeholders may 
lack the overall policies and guidance needed to assist them in their 
efforts to ensure that privacy protection measures are consistently 
built into health IT programs and applications. Moreover, the 
department may miss an opportunity to establish the high degree of 
public confidence and trust needed to help ensure the success of a 
nationwide health information network. To address these concerns, we 
recommended in our September report that HHS include in its overall 
privacy approach a process for ensuring that key privacy principles and 
challenges are completely and adequately addressed.
    Lacking an overall approach for protecting the privacy of personal 
electronic health information, there is reduced assurance that privacy 
protection measures will be consistently built into health IT programs 
and applications. Without such assurance, public acceptance of health 
IT may be at risk.
    In closing, Mr. Chairman, many important steps have been taken, but 
more is needed before we can make a successful transition to a 
nationwide health IT capability and take full advantage of potential 
improvements in care and efficiency that this could enable. It is 
important to have structures and mechanisms to build, maintain, and 
expand a robust foundation of health IT standards that are agreed upon 
by all important stakeholders. Further, given the complexity of the 
activities required to implement health IT and the large number of 
stakeholders, completing and implementing comprehensive planning 
activities are also key to ensuring program success. Finally, an 
overall privacy approach that ensures public confidence and trust is 
essential to successfully promoting the use and acceptance of health 
IT. Without further action taken to address these areas of concern, 
opportunities to achieve greater efficiencies and improvements in the 
quality of the Nation's health care may not be realized.
    This concludes my statement. I would be pleased to answer any 
questions that you or other members of the committee may have.
                      contacts and acknowledgments
    If you should have any questions about this statement, please 
contact me at (202) 512-6304 or by e-mail at [email protected]. Other 
individuals who made key contributions to this statement are Barbara 
Collier, Heather Collins, Amanda C. Gill, Rebecca LaPaze, and Teresa F. 
Tucker.

    Senator Mikulski. Thank you very much, Ms. Melvin. It is 
exactly what we had hoped to hear.
    I am going to move right into my questions, and I am going 
to take about 7 minutes and then turn to Senator Merkley. And 
then, if we have time, we will come back for a second round.
    But first, I want to say to the panel and to the many 
people in this room, this isn't the only conversation we are 
going to have. It might be the only formal hearing, but this 
isn't the only conversation.
    I am asking my staff as well as our Republican colleagues, 
particularly Senator Enzi's staff and whoever else he will 
designate, that we can have this to get it right.
    I didn't want this to become an appropriations hearing on 
the stimulus package, but I have to ask a question about what 
will be before us in the stimulus package. Let me give 
background quickly to my own thinking, and then I am going to 
turn to your thoughts and recommendations.
    There is great desire in our country for change, and one of 
the areas is in healthcare. Our President has got it, and he 
wants to do it. The appointment of Senator Daschle, soon to be 
our Secretary of Health and Human Resources as well as the 
health czar. They want to move on health IT. You heard it on 
TV. We hear it everywhere.
    I was a little skeptical of this. So let me tell you my 
skepticism, and it goes back because in my other committees I 
have watched where we dashed ahead with unbelievably good 
intentions, the will of the American people behind us, and we 
threw a lot of money at stuff. And we ended up with boondoggle.
    I can't go there again, and we can't afford to go there 
again. We can't afford to waste time on a fool's journey or 
waste money. We just don't have either one.
    I want to work with our President and really then move 
health IT in the stimulus. So here is my question. We know 
about the interoperable challenges. We know about privacy. And 
for all in this room, from our ACLU friends and others who 
really raise the voice of privacy, we want to consider that.
    I want to focus, as you do in healthcare, we need to be 
measured for performance and outcome. Having said that, 
conceptual language in the healthcare stimulus, could we be 
sure that when we spent it, we are achieving the goals?
    Because there is fair unanimity here in what needs to be 
achieved. There is no difference of opinion. And so, my 
question is, No. 1, do you think we ought to put it in the 
stimulus? And No. 2, what, in addition to adequate funding, 
should we do? And should we be very prescriptive?
    Could you share your thoughts because we are going to be 
marking up next week or the week thereafter, and I want to get 
it right. I am going to work with Tom Harkin and Senator Inouye 
and Senator Thad Cochran because it will move to 
appropriations. But we would like, really, your thinking.
    Or do you think we should wait on it? Do you think we 
should wait? And if we don't wait, how can we get it right so 
that we make a down payment on what we need to do?
    I am just going to go down the room in the way we testified 
on that.
    Dr. Cochran. Well, I appreciate, No. 1, your recognition to 
be skeptical of how things have seemed simple in the past and 
didn't turn out to be as simple. I think the desire for the 
change in healthcare, we ought to all understand it is about 
time that this country of such great wealth needs to take a 
better view of the holistic healthcare system.
    I think that we can debate, and I think what I heard this 
morning was a lot of agreement around the issues of 
interoperability and privacy and that sort of thing. What I 
would say when you look at the funding and the totality of the 
planning of health reform, to me, would be to really understand 
holistically the complexity of the issues and not try to find 
quick fixes.
    Health IT is a perfect example that could be an investment 
that really costs a lot of money and not get any returns 
because it wasn't tied to significant improvements in 
workflows, delivery system, and the way healthcare is paid for.
    I came originally from a private surgical practice, became 
a Permanente physician, went from fee for service to a 
different model. And the way we pay for healthcare can be very 
perverse in terms of does it really enable us to provide great 
quality?
    We have in our coding for fee-for-service medicine 10,000 
codes for treatments and interventions, and we have very few 
codes or none for outcomes and cure and treatment. So when you 
plan this process, health IT is not a silver bullet. Financing 
is not the only answer.
    Resourcing healthcare personnel and some of those things to 
build up the capabilities of more social workers and more 
nurses and more primary care physicians, I think it has to be 
looked at holistically.
    The Clinton plan was very holistic but lost a lot of 
political steam and lost a lot of acceptability. I think the 
way that the President-elect is approaching it is very 
formidable because he is really looking for input and being 
very interactive.
    So I would say that the silver bullet is not IT. It is not 
in any necessarily financing mechanism. But if you are going to 
really make a difference, you have got to look at all of those 
factors. And I think what I have heard this morning is an awful 
lot of congruence around some of the issues that you are 
facing.
    Senator Mikulski. Thank you.
    Ms. Corrigan.
    Ms. Corrigan.Yes, it is a wonderful question, Senator. I 
think that some investment in health information technology in 
the stimulus bill is very appropriate at this time. However, it 
needs to be viewed in a broader context and a broader policy 
agenda.
    I would encourage a multi-pronged approach, that there be 
initial support to encourage investments in health information 
technology in the stimulus bill, but that that be health 
information technology that has been demonstrated to possess 
the necessary capabilities to actually perform some of those 
important functions that will result in better care.
    For example, it is certainly appropriate to invest in HIT 
that is capable of exchanging data on prescriptions, laboratory 
tests, and other critical information. But we need to know that 
that functionality is there. That is what we should be paying 
for.
    I think a second part, though, of a broader strategy is to 
begin to align our payment systems much better with paying for 
actual outcomes and improvements in patient care. That, in 
turn, will reward those who not only invested in good HIT with 
the necessary functionality, but put it to effective use.
    Senator Mikulski. Mr. Neupert.
    Mr. Neupert. I need to support the views of the prior 
speakers. I think payment reform is an important first step so 
that the right actions are motivated. But I would say that one 
additional comment is the data exist today. We don't need to 
just invest in creation of new electronic data.
    I really would focus the near-term stimulus to leverage the 
existing data assets that are out there--prescriptions held by 
the pharmacy benefit managers or the pharmacies, labs that are 
held by the national labs--Quest, LabCorp--large health 
systems, and images.
    If we can just get those data starting to move today in 
health information exchanges, we can go a long ways toward 
enabling and empowering both consumers and their physicians to 
deliver better outcomes right away. Then we can do the hard 
work of thinking about, holistically, how do we reform the 
system?
    Senator Mikulski. I am going to turn to you, Ms. Grealy. 
But just a quick follow-up to you, Mr. Neupert, because I think 
many of my colleagues--because we are not geeks and techno 
wizzes here, though we ought to be more with it. But I think 
some envision like a national healthcare record that exists 
like your Social Security record.
    I think what you are saying and what others have also 
indicated is that this is going to be a network of networks. So 
that, for example, I have a primary care doc who is a physician 
who has privileges at Mercy Hospital. Any acute care I have 
needed has been--mine would either be Mercy, Hopkins, or 
University of Maryland. But my point is, they will each have 
their own, and my blood work is being done by Quest.
    So what you are saying is meet the networks that are 
already networking and then the stimulus, in other words, don't 
think of it like a Social Security record, think of it as a 
network of networks. Am I correct? And then, as we do the 
stimulus, get started with the networks that exist and could 
already begin to network?
    Mr. Neupert. Yes. In many regards, the data is there today. 
We have to think of there is not going to be one record. There 
are going to be multiple records.
    Hopkins needs to have its copy of your stuff. University of 
Maryland, if they treated you, needs to have your copy. But 
you, as a consumer, could have the longitudinal copy and share 
it appropriately.
    That is the important thing, that the data is embedded in 
many of these systems already. It is not that hard to extract 
it. We have the knowledge, the technical capabilities today to 
make that available in an effective way, and then you start to 
see the network of networks start to happen.
    Right now, they are all closed systems, and it is getting 
those open and sharing which is the most important first step, 
in our opinion.
    Senator Mikulski. OK. Ms. Grealy.
    Ms. Grealy. Well, I think Mr. Neupert made a very critical 
point, and that is critical data, rather than the whole 
enchilada, as it were. That with imaging data, lab test data, 
those really are the critical components that you want to share 
among these various providers.
    I often use a very personal example of trying to help my, 
at the time, 89-year-old father, who was on dialysis, also 
being treated for cancer, doing radiation treatment five times 
a day. And the various providers--I spent 1 day--this is in 
Fort Lauderdale, FL--going to six different appointments.
    And for each time to have to hand over a paper copy or have 
the dialysis center fax the latest blood test work, I mean it 
was ridiculous and harmful for the patient. So I think that is 
what it is all about. We do have the technology. We do have the 
data. We can start doing this now.
    As Janet Corrigan said, let us think on parallel tracks. We 
would like to see in the stimulus package loans and grants to 
really facilitate those that have taken this on, that have 
taken the leadership and help others come onboard with e-
prescribing and a whole host of other things.
    We need to do more work on establishing the standards. A 
lot of good work has happened already, and I think all of us 
want to make sure that we don't duplicate what has already been 
done. Let us go ahead and build on it.
    Then most importantly, I think, is not to be overly 
prescriptive. There is a lot of innovation out there. We want 
to foster that innovation. We can share the critical data, but 
I think each system will want to tailor their system to their 
particular needs. But we want to make sure that the critical 
data components are interoperable and can be shared for 
patients.
    And as I noted in my testimony, we can see some very short-
term, very dramatic results, and we also can see a financial 
return on the investment that has been made.
    We have had members--I will use Baylor as an example. They 
knew this was the right thing to do. They did not expect to 
save money on it, and they have been very pleasantly surprised 
to see that return on the investment that they have made.
    Senator Mikulski. Ms. Melvin.
    Ms. Melvin. Yes, speaking from an accountability 
perspective, obviously, the most important aspect that we see 
is a comprehensive approach to doing this.
    And within that approach, where you are looking for the 
ultimate outcomes in terms of what you are trying to achieve, 
we think that it is important--and recognizing, again, what has 
been said about the number of initiatives that are already 
being undertaken--to take from those lessons learned, to see 
how successes can be applied, to see what has worked already, 
what hasn't worked, and to incorporate that into an overall 
strategy or a framework, if you will, or a plan for how and 
what is necessary to move forward.
    Also trying to work at this in an incremental approach. I 
think I have heard today some emphasis on the fact that this is 
not something that you want to do very quickly. It is not 
something that has proven itself to be able to be done very 
quickly, as VA and DOD's experiences have already shown.
    However, having an incremental approach would have the 
benefit of allowing opportunities to step back momentarily, 
assess what has worked, and to perhaps readjust and make 
changes along the way. But at the same time to carefully 
consider all of the experiences that have already been 
undertaken and what opportunities there are for greater 
enhancement in terms of quality of care and the successes 
associated with that.
    The demonstrated uses relative to the assistance that can 
be provided. Oversight is another area that I would advocate 
for early efforts toward. From the standpoint that, as I have 
said in my statement, it is important to know what it is you 
are trying to achieve, and it is important to have measures for 
being able to assess your progress once you have gotten there.
    So, from that standpoint, having some interim measures to 
work toward a final outcome would be, in our view, an important 
factor to have reflected early on in the process.
    Senator Mikulski. Well, I appreciate this comment because 
there is a consensus. Go ahead with it. Be skeptical because 
that is a good thing. But don't use your skepticism to stop 
you, but to look at this in a well-paced, prudent way, looking 
at the endgame, which is that, ultimately, we will be doing 
health insurance or health reform.
    We want to keep the word ``health'' and not just be looking 
at this as a new insurance scheme. But look at where we are 
going to be heading. And I think there is agreement on what 
needs to be accomplished.
    When you look at your testimony, what Dr. Bill Frist has 
said, what Newt has said, we all know the ultimate endgame that 
we want to achieve with health IT and even with health reform, 
which is improving patient care, management of chronic illness.
    When you have an acute incident, everyone has access to 
what they need to know about you, and also you have to take 
responsibility for your own healthcare by keeping those 
appointments and asking those right questions.
    I think these are excellent recommendations. I am going to 
ask when this is over, though, for my staff to have a little 
bit not from podium-dais to you, but to really talk about what 
you think would be essential so that Senator Harkin and those 
of us who are the appropriators working with Kennedy and Enzi 
can get into it.
    I have some other questions, but now I am going to turn to 
Senator Merkley now for questions that he might have.
    Senator Merkley. Thank you very much, Madam Chair.
    And thank you for your testimony this morning.
    I want to clarify what this looks like from the point of 
view of your average American. For example, consider the fact 
that I have had many different health records that have been 
built up and held in these different networks, and I am now 
back here in Washington, DC. Perhaps I have a health incident, 
and so the physician of the Capitol is going to access my 
records.
    Is he going to do that by name, by Social Security number? 
Is he going to need a password? Is he going to see a list of 
networks that have information, or is he going to be able to 
use a simple identifier in order to gain access to the entire 
set of records?
    If one of you could just take that on and help clarify the 
vision as you see it from the consumer's point of view?
    Mr. Neupert. At Microsoft, we have developed a service 
called HealthVault, which allows you to keep your own copy of 
the records.
    Senator Mikulski. Excuse me, Mr. Neupert. What is it 
called? Health what?
    Mr. Neupert. HealthVault.
    Senator Mikulski. Vault.
    Mr. Neupert. Vault, as in safe, secure, private, yours, 
with a key.
    Our vision doesn't imagine connecting all of those 
electronic systems to each other. That would be very 
complicated and might be kind of slow. But it is very easy to 
connect each of those electronic systems to this one hub, or 
Google has a competitive one, and there could be more than one 
of these.
    But just like you choose what bank or financial institution 
you want to keep your assets in, you ought to be able to choose 
where you want to store your critical health data assets. All 
you need to do is be able to make sure that it is connected to 
each of those providers and to the pharmacy.
    Because lots of health happens not just in the doctor's 
office. Some of it happens at home. You might want to keep your 
weight. You might want to keep your exercise workout stuff 
because those are important attributes. What you eat are 
important attributes to your total health.
    And then, when that acute incident happens, what you want 
is an easy mechanism for the provider of service for you to 
share, and this solves many of the privacy issues because you 
can choose with whom you want to share your critical 
information at every point in time and what part of that record 
you want to share out.
    So we took a different approach to trying to solve that 
problem, and it exists today, and it is free for consumers.
    Senator Merkley. If I am critically injured, how does the 
emergency room access that information?
    Mr. Neupert. There are lots of solutions to that problem. 
The simplest solution is for you to carry something that gives 
a particular code for them to get access to it.
    Senator Merkley. Did you want to add something?
    Dr. Cochran. Yes. First of all, the tension at the level of 
the consumer is if you are injured or you are sick, you want 
people to have access to that data. You want to make sure they 
got it through a system that was very secure and very private, 
which goes back to basically the Hippocratic Oath anyway, that 
that is what physicians want.
    So in a great world, an ideal world progressively. For 
example, we are an organization that if we were a State, we 
would be the 12th biggest State. So we have millions of 
members, many locations. When we talked earlier about how 
physicians were a little reluctant at first, it was hard 
because it disrupted their day. They weren't used to having a 
computer between them and the patient.
    You could not get the computer out of their office. They 
absolutely love it, and it is because of that, it is because 
the information is available. It is secure.
    If you are seeing a primary care physician with chest pain, 
and you have an old cardiology appointment, they can both be 
looking at your record at the same time and conferring with 
each other, in State, out of State. So in a perfect world, if 
we are large and leverageable, it could be done on a more 
national level for members and patients who have got to get to 
that security and privacy belief system before they are ever 
going to want to have that happen.
    It creates a very safe system for people because if they 
have idiosyncratic diseases or complexity, they carry it around 
on a piece of paper in their wallet or they carry it in an EHR, 
which is very progressive, or PHR. But right now, you are 
really kind of on your own. And so, it is not a very safe way 
to have intercurrent disease.
    Senator Merkley. Thank you for helping clarify that.
    My wife works as a nurse for Providence, which has received 
many awards for being one of the most wired hospitals, very 
high technology use. However, it is much harder to get rural or 
smaller institutions involved, and what kinds of efforts do we 
need to really make the IT solutions reach out and connect to 
the rural parts of our country?
    Ms. Grealy. I think this is probably where we have the 
greatest potential for seeing that return on the investment, 
whether we are talking about telemedicine or being able to 
share this information about patients over a broad geographic 
area.
    I would say the key component for those facilities is going 
to be the financial support in order to implement and adopt 
these systems, and I think it can make a tremendous difference 
in helping patients in those rural areas have access to high-
quality health-
care.
    Ms. Corrigan. Yes, and Senator, part of this has to do with 
encouraging the development of more organized systems of care. 
We have a two-class system right now in the country for those 
who have access to HIT-enabled care and those who don't.
    If you look at the organized systems, whether it is Kaiser 
Permanente, it is the Veterans Health Affairs, it is Mayo, or 
Geisinger system--it doesn't have to all be multispecialty 
groups, but an organized system--they have upwards of 95 
percent that have fully functional, sophisticated health 
information technology systems in place. And those who receive 
their services within a system like that are getting higher 
quality, more affordable care.
    It is when you move out into communities that are highly 
fragmented where those relationships do not yet exist. So part 
of the solution here is to encourage the development of those 
relationships.
    Mary Grealy mentioned Baylor earlier, and they have gone 
down the road in the last 5 years or so to really begin to 
reach out to the physicians that are the heavy admitters to the 
Baylor health system and to begin to work with them 
collaboratively on installing electronic health records that 
have connectivity with the rest of the system.
    So I think one of the keys here is to break down barriers, 
and there are some important policy barriers to those 
relationships developing. The Stark anti-kickback legislation, 
I think, has unfortunately become a barrier to hospitals 
working with the physicians in the community to help them get 
the technological support and capital they need to be able to 
be a part of an EHR system and exchange information together.
    Senator Merkley. Thank you very much, and my time has 
expired.
    Senator Mikulski. Senator, first of all, those were 
excellent questions that I think all of us would share. It 
shows you are going to be a really active and great member of 
our committee, and again, we welcome you.
    I just want to, first, ask unanimous consent that all full 
statements of our panelists be included in the record. Second, 
I want to be sure that we have unanimous consent that any 
Senator who wishes to place a statement in the record on this 
topic can. All Senators who might have additional questions 
will submit them.
    I know that Senator Enzi in particular has a list of 
questions. I believe Senator Alexander and some others do. So 
anybody that has questions, they will be submitting those in 
writing.
    I am going to ask one final question, and then this 
committee will adjourn. This goes to interoperability, and 
really, I am going to go right to you, Ms. Melvin.
    Because we have many good ideas--we could be talking about 
the health manager that Kaiser has, the HealthVault that Micro 
has, the need to know as part of privacy, etc., but if this 
isn't interoperable, nothing is going to achieve our goals.
    I looked at the chart of approval that is set over at HHS, 
and also our outgoing Secretary even wrote an op-ed in the Post 
about this. Ms. Melvin, what do you think we can do now? 
Particularly, do you think we need to streamline the 
interoperable process? How can we work on that now?
    Then I invite our panel to submit to us even additional 
thoughts about how we can get this interoperability thing going 
now and have a streamlined, but ongoing process.
    Ms. Melvin. What I would emphasize is prioritization. I 
think that is probably the key. Whether that ultimately results 
in a streamlined process or perhaps a process that over time 
results in the ultimate outcome, the key, I think, will be to 
look at what are the significant clinical needs? What are the 
significant outcomes and results that are desired early on 
based on experiences that have already been proven through the 
initiatives that have been undertaken?
    And use that information to drive what priority needs might 
be the ones that you focus on initially. We have seen VA do 
that in its work relative to specific types of information that 
needed to be in its medical record. I would say VA and DOD, as 
they have attempted to incorporate interoperability into their 
sharing efforts. And as a result of that, they have identified 
some key data that can be shared.
    But one thing that is important to remember is that in 
terms of interoperability, and I have noted this in my 
statement, is that there are different levels. And not all 
levels are necessary for all aspects of healthcare.
    It is important to figure out what needs to be done and to 
establish priorities for when they need to be done, and to let 
that drive what the ultimate outcomes will be relative to how 
standards are implemented and what particular data exchanges 
are taking place, when, and for what purposes.
    Senator Mikulski. So, as we develop interoperability, we go 
for the goals that have been set here, that, ultimately, 
whatever we are developing should be improving healthcare 
outcomes and enabling all who are involved in patient care to 
be able to do this.
    But to go to what Mr. Neupert said, we can begin now with 
what is already being developed in some ways by national 
systems like the bloodwork people.
    Ms. Melvin. There are important examples, very good 
examples out there relative to what has been done and what is 
capable of being done that do serve as great input to making 
decisions on what are key and primary efforts to focus on.
    Senator Mikulski. Well, I looked at the chart. You have 
HHS, the Secretary. He has a policy recommendation for review 
and approval group. Then he has the Office of National 
Coordination. He has three things under him. You have the 
American Health Information Community, which has nine 
Government agencies. I mean, you have--we could be Rube 
Goldberg here.
    But we are going to leave that to our Secretary of Health 
to streamline. I think what we need to do is take your input. I 
think you have given us excellent guiding principles over what 
we need to do and also what we need to be considering in the 
health stimulus.
    We really look forward to ongoing conversations with you, 
with that which is represented in this room, with our privacy 
people, lead groups like the ACLU, and so that we are mindful 
of that because they have very good insights, and they often 
raise questions we don't always think about.
    But at the end of the day, we want to improve patient 
healthcare and have providers be able to have the tools they 
need or what they need to know and what they need to know from 
each other.
    This has been excellent. We would like to pursue this in 
more detail, and we are going to continue to do that. I view 
this hearing as a down payment on ongoing discussions on health 
IT.
    Thank you very much for participating, and any additional 
information to be submitted is most welcome.
    This committee will stand adjourned, subject to the call of 
the Chair. Thank you.
    [Additional material follows.]

                          ADDITIONAL MATERIAL

                 Prepared Statement of Senator Kennedy

    In this new century of the life sciences, almost every day 
brings new medical breakthroughs and extraordinary scientific 
discoveries. Biotechnology has created undreamed-of solutions 
to longstanding medical challenges. Conditions which once 
required invasive surgery can now be treated through 
increasingly less costly procedures. The human genome project 
has begun to solve some of the most profound medical mysteries, 
inspiring scientists to find better ways to treat cancer, 
diabetes, Alzheimer's Disease, and other major illnesses.
    Our health care system itself, however, is still plagued by 
staggering inefficiencies. With the cost of health care 
approaching 20 percent of our gross domestic product, serious 
action is required to turn back this tide of rising costs. We 
need to recognize that the technology revolutionizing the 
development of new treatments can also increase patients' 
access to good care at a much lower cost.
    In recent years, information technology has transformed 
many industries ranging from telecommunications to financial 
services. Yet, the health care industry continues to lag behind 
in implementing information technology, even though the 
potential for major improvement has been known for years.
    Today, one in every seven primary care visits is undercut 
by missing medical information. More than 40 percent of 
Americans have been victims of preventable medical errors, and 
as many as 100,000 Americans die each year because of such 
errors. In a nation that spends more on health care than any 
other country, and that has the best doctors, nurses, 
hospitals, and scientists in the world, such errors are 
intolerable.
    Information technology can reduce these errors 
significantly. Yet the gap is widening each year in 
implementing it. It now costs a physician's office about 
$40,000 to install a new IT system. Increasingly, our public 
hospitals and community health centers remain in the dark ages 
of health technology, while health institutions with financial 
means are implementing life-saving, cost-effective systems. 
Estimates by the RAND Corporation indicate that the widespread 
adoption of electronic health records could save up to $160 
billion a year.
    So far, the vast majority of investment in IT has come from 
the private sector. But Federal grants such as those proposed 
in the last Congress would enable the health care industry to 
convert individual examples of health IT success into a 
national trend.
    The advantages of health IT must obviously be accompanied 
by careful protection of patient privacy. Many of us have been 
working with the provider and patient communities to develop 
strong privacy protections, including notice to patients when 
their medical information is wrongly disclosed. We also commend 
Secretary-Designate Tom Daschle's commitment to work on patient 
privacy, information security, and appropriate uses of health 
IT in health reform.
    I look forward to working closely with my colleagues on the 
HELP and Finance committees and with the incoming Obama 
administration to ensure that our promise of a coordinated 
health care system is delivered to the American people. Thank 
you, Senator Mikulski, for bringing this important issue to 
light.

                   Prepared Statement of Senator Enzi

    I would like to begin by thanking Senator Mikulski for 
holding this hearing today and thanking the witnesses who are 
before us.
    I have been working on increasing the adoption of health 
information technology for the past 4 years and I am hopeful 
that this is the year when we can finally get something done. I 
believe that promoting widespread use of health information 
technology (health IT) will help to reduce health care costs 
and improve health care quality. Investing in health IT will 
pay enormous dividends not just in dollars saved, but more 
importantly, in lives saved.
    In order for health IT to achieve this potential, however, 
it must be interoperable. Simply throwing around taxpayer 
dollars as an investment in health IT is not a solution. We 
need to establish consensus standards so that doctors will not 
have to worry that the IT investment they make today will be 
obsolete tomorrow. Purchasing health IT software should not be 
like investing in compact discs the day before iTunes 
launched.&
    Any investments made in health IT need to be coupled with a 
requirement that purchases comply with technology standards 
harmonized by the Healthcare Information Technology Standards 
Panel and certified by the Certification Commission for Health 
IT. Additionally, I urge the President-elect to ensure all 
Federal investments in health IT are fiscally sustainable and 
financially sound.
    I look forward to working with President-elect Obama and 
Senator Daschle to build upon the progress of the Bush 
administration. Greater adoption of health IT also presents an 
opportunity to increase the privacy and security of patient 
records. Health IT systems can build in protections and 
tracking mechanisms that are impossible to achieve with a 
paper-based system. In some of these instances it may be 
necessary to take a fresh look at the current privacy and 
security rules, but I urge my colleagues to proceed with 
caution.
    It is critical to strike the right balance between patient 
privacy and proper access to health information. If information 
is wrapped up in so much red tape that doctors and their staff 
are not able to access it when they need it, patients will 
suffer the consequences. It will take time and hard work, but 
we must find the right balance so patient care does not suffer.
    In closing, I would like to reiterate that my primary 
reason for pursuing health IT legislation is to increase the 
quality of health care. I hope that any legislation that moves 
forward achieves that goal. I look forward to working with all 
of you during this Congress to increase the adoption of health 
information technology and improve the quality of health care 
in this country.

                  Prepared Statement of Senator Murray

    I am pleased that this hearing is being held so we can 
discuss how to expand the use of information technology in the 
health care system.
    I've been a longtime advocate for increasing the use of IT 
to improve health care, especially to create electronic health-
record systems.
    And in my home State of Washington, I've been proud to 
support efforts to use IT to expand access to health care in 
remote communities--as well as to improve care for everyone.
    On the national level, I think IT has the potential to 
revolutionize our health care system.
    And it's critical that we make these investments now--
especially in light of the economic crisis. Layoffs are on the 
rise, families are losing their health insurance, and that 
means more and more people are going without health care to 
save money.
    We need to talk seriously about ways to reduce health care 
costs and improve care.
    And I want to extend a special thanks to Peter Neupert from 
Microsoft Health Solutions for being a panelist.
    Microsoft has been a leader in the effort to create 
electronic medical records and make them available to doctors 
and administrators in real time. They're developing ways to 
help doctors make better decisions about how to treat 
patients--and they're helping administrators plan how to use 
hospital resources.
    Microsoft is already working with health care providers 
around the country, including Seattle Children's Hospital and 
the University of Washington. I'm sure that their valuable 
experiences will be useful as we move to expand health IT.

    [Whereupon, at 11:06 a.m., the hearing was adjourned.]

