GUERRA: We’ve heard that small hospitals are struggling to comply with meaningful use and the 10 percent CPOE requirement.  

PITCHER: You’re right on the mark. For these hospitals, it’s difficult. Oftentimes, due to both dollar constraints and resource constraints, they’re challenged and they’re playing catch up to the larger hospitals, who have mostly adopted their clinical technologies. Many of these critical access hospitals are just getting started now, and even then only being forced because of ARRA.

GUERRA: KLAS recently issued a report entitled, “Closing the IT Gap: Critical Access to 50 Bed Hospitals.” What got you interested in this space? Did you see there was a demand for information among these hospitals?

PITCHER: That is exactly what happened. In fact, I want to hedge that. We, oftentimes, are focused on the larger hospitals, but with ARRA coming out, IT became a must for all hospitals. So we felt there was an opportunity to address some of their concerns, to answer some questions for smaller hospitals who are perhaps lagging, in terms of technology. We just felt it was perfect timing to put this report out and, hopefully, get this information into the right hands.

GUERRA: Did you have any expectations going in about what you would find?

PITCHER: There were not a lot of expectations. I think the initial expectation was we had an idea of which vendors would play in this space, and that really held true. We certainly had expectations that Healthland, HMS, and CPSI were going to be the major players.

Beyond that, there were no expectations. Some of the results were kind of interesting, especially as it relates to the performance scores of Healthland in comparison to their competitors. Their scores stood up, stayed the same; whereas some of the other scores fell away. So the smaller the hospital, the worse the scores became for some data elements within our study.

GUERRA: Healthland has been around for a while, formerly as Dairyland. They may not have that much name recognition unless you realize the organization does have a long track record, correct?

PITCHER: Yes, I don’t know how much name recognition they have with Healthland. Certainly, I think Dairyland had great name recognition. I don’t know whether the industry connects the two. The other two – HMS and CPSI – also have long track records.

GUERRA: So there were some interesting data points, but nothing really startling about the findings?

PITCHER: I hate to focus on a particular vendor’s performance, but I was a little bit startled to see how the Healthland scores outperformed the other competitors in 34 of the 39 measurements that we checked. And that wasn’t the case when we measured them, say, in an overall community hospital perspective. That is, if we’re looking at the vendors and including all of the customer base from HMS and CPSI, then that doesn’t hold true, but as soon as we filtered that out, then some of those better scores for the other two vendors fell away.

GUERRA: Break that down for me – does that mean they’re better or they’re not better?

PITCHER: I’m hedging here because what I don’t want to do is focus on one vendor. I would think it indicates to me that the technology has become more challenging for a critical access hospital with limited resources.

GUERRA: In the interviews I’ve done with small hospital CIOs and IT directors, I was surprised to hear that money was not the barrier I thought it would be. Does that make sense to you?

PITCHER: That makes sense to me in the context of recent events. I wouldn’t agree with that if we were to look at a longer timeline, and I would say hospitals typically have complained about the cost associated with technology, which is why many of these hospitals have lagged in clinicals. I think to put your comment into context we have to think of the dollars associated with meaningful use. In that case, these hospitals really feel it’s imperative to put these technologies in place, and so maybe the revenue constraints are less important at this juncture.

GUERRA: I did hear a lot of trepidation about CPOE, and getting the independent physicians to embrace it.

PITCHER: There are a couple of elements there. One, almost irrespective of the technology you’ve put in place, physicians tend to be resistant to this because it impacts the way they have done business for years. They don’t want to see themselves as order-entry clerks or putting data in. So therefore, the customers across all of the vendors’ customer bases face that same challenge. It’s a little easier if you’re dealing with the hospitalist, a physician who is employed by you, then you can mandate use. But if they’re not, how do you get those physicians to use it? So the key is to have technology that is simple, intuitive, easy to use, and that’s where the vendors in this area struggle.

So we show some good adoption, especially CPSI with CPOE, but there isn’t necessarily a lot of physician affinity for the technology. And then, as it relates to Healthland and HMS, it’s really hard for us to measure physician affinity because they don’t have a lot of measurable sites. I think each of them had a couple of CPOE sites.

GUERRA: One of your main findings was that small hospitals are generally not happy with the vendors. I was surprised by that because I expected them to be more passive. Does that make sense?

PITCHER: It certainly does make sense and, as the study pointed out, there are not a lot of benefits to a hospital of this size tackling integration because it adds layers of difficulty. They don’t want to deal with interface engines and HL-7 messaging. So they really are seeking a single-vendor solution as much possible to reduce the amount of resources they have to put into managing this technology.

GUERRA: You talked about the architecture, which was interesting, and it seemed like the vendors in this niche did not have the more advanced Web-based architecture. Do you think that’s going to be a major issue? Is that going to limit these vendors?

PITCHER: I think it’s going to be a major issue if the vendors don’t address that. I think the market is going to force them to address that if they’re going to remain competitive, and we see that already with a couple of the vendors. First of all, McKesson’s technology is newer. We see what HMS is doing with Java, and we’re watching to see what some of the other vendors are doing.  

GUERRA: It seems the jump from whatever the applications were originally built in to some native Web-based environment is very difficult because it’s such a big project. It’s painful to move your customers, and you undoubtedly lose some.  

PITCHER: Well, it really becomes additionally challenging when you’re still dealing with the technology that perhaps was originally introduced 20 years ago, and you’re trying to deal with new presentation layers through the Web, etc. It’s very difficult to bridge old technologies with new technologies for that presentation layer.

McKesson, for example, took a different approach. With Paragon they started from scratch, built it all over with new technology. I think that’s probably going to pay off for them in the long run.

GUERRA: It’s better in the long run, as long as you survive the short run.   

PITCHER: Yes.

GUERRA: Do you have any advice for small hospital CIOs and IT directors?

PITCHER: I have some limited advice – missteps, false starts can be a killer; they can almost take the hospital out of the game because you don’t have the ability to restart CPOE, for example, or some of these other technologies. If you lose your position on the first pass with this, you may not get them back. It’s going to be critical to select the appropriate vendor and make sure the vendor offers what you need. Again, it becomes an issue of capital resources. Hospitals don’t have the ability, the wherewithal to step back and make a new selection. Timelines are critical, so good selection and good planning are critical to this entire process.

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