Northrop Grumman health care strategy focuses on flexibility
Rapidly changing market forces companies to stay on their toes
EDITOR’S NOTE: This is the second part of a two-part interview with Northrop Grumman’s Amy King, vice president, health IT.
Click here for part one
Staying up to date on developments in health IT is no mean feat. But Northrop Grumman civil health IT vice president Amy King has an advantage: She’s been a leader in the field since it was less a field than a glimmer of things to come. Washington Technology contributing editor Sami Lais recently spoke with King about the challenges, opportunities and constraints of maintaining and growing a big health IT contracting company.
WASHINGTON TECHNOLOGY: You’re doing some kind of health technology work for pretty much every federal agency, but a recent win, for $34 million from the Centers for Medicare and Medicaid Services (CMS), is to develop the National Level Repository. What is that?
KING: It’s a data repository for administration and incentive payments of Medicare and Medicaid programs to medical professionals, hospitals and other organizations. It’s part of the Health IT for Economic and Clinical Health Act, for the incentive payments for any hospital or doctor that adopts electronic health records (EHR). CMS has lots of money to incentivize these doctors and hospitals to adopt the technology. But they have to demonstrate "meaningful use."
WT: The Health and Human Services Department in July released a definition of what constitutes “meaningful use” of EHR technology. Medical professionals must meet those criteria to qualify to get an incentive payment.
KING: Yes. It means we have to have a system up and running and making payments by January.
WT: And CMS added to that with its concurrent release of a rule on the minimum requirements that medical professionals must meet through their use of “certified EHR technology” to qualify for an incentive payment?
KING: That means that we know, at least for now — everything is subject to change, what exactly is required, what EHR solutions must provide to qualify for use under the incentive program by medical providers.
WT: The third part of the July 13 announcements was an Office of the National Coordinator for Health IT (ONC) final rule on standards and certification criteria for “certified EHR technology.” But it’s a final rule on the temporary EHR incentive programs. The final rule on the permanent program won’t be released until 2012?
KING: Exactly. The temporary incentive program was instituted to get the incentive money moving.
The permanent program gives us the time we need to build a flexible system for CMS so they’ll be ready to change as rulings occur and legislation is passed, so they can be agile and flexible in reacting to changes and meeting the demand of people adopting the health technology.
WT: OK, but here’s something I’m still confused about. The final rule on a temporary certification program for EHR technology, issued June 18, says adopters must use "certified EHR technology" to get an incentive payment. For a company to get its EHR solution certified, it has to go to an ONC-Authorized Testing and Certification Body (ATCB). But there are no ATCBs. So how does that work?
KING: That’s a great question; that one I don’t have an answer to. [Laughs.] There are so many moving parts, and there is so much going on in health IT today, you almost have to have a cheat sheet or score card to keep track of what’s going on, whether that’s on the military health side, the Veterans Affairs Department, the CDC or CMS. And then there’s the broad brush of health care reform that touches everything down into the states. States have a lot of changes they have to make to their systems in place by 2014, and some of them haven’t even started planning, let alone put out requests for proposals.
I call it a tsunami of opportunities that are going to be coming upon us in the future. We feel that our presence -- our footprint in the federal, state and local government space -- gives us a certain advantage to go after some of these opportunities and really connect the dots.
WT: Let’s talk about some of the opportunities out there. Let’s start with the National Institutes of Health’s Chief Information Officers Solutions and Partners acquisition. NIH just got the go-ahead on CIO-SP 3. Northrop Grumman’s TRW acquisition in 2002 came with a spot on CIO-SP 2, which was worth $20 billion. CIO-SP 3 is worth $40 billion. That’s a lot of potential.
KING: Yes, but NIH never hit the ceiling on [CIO-SP 2], so it’s hard to say how big the CIO-SP 3 contracts are going to be.
The other thing is that in the federal health marketplace, all of our customers have their own indefinite-delivery, indefinite-quantity contracts. So CMS has [its] own, Social Security is about to award theirs, the Food and Drug Administration has theirs, the Centers for Disease Control is about to award theirs. Transformation Twenty-One Total Technology (T4), the one for the Veterans Affairs Department is a $12 billion dollar contract. [Proposals were due Aug. 31.]
Q: And with each agency working off its own contract, you have to do separate proposals for each agency and each task order.
KING: Yes. You get the ‘hunting license’ but then you have to bid on each of the task orders underneath. A company may feel it has to step up and get the hunting license, but then there’s also the money to invest and respond to proposals before you can get a chunk of that $40 billion. A lot of people have been questioning the sanity and the need of that process.
There’s also been a lot of concern that each of these agencies, instead of using the CIO-SP 3 vehicle at NIH, are having their own separate vehicles.
Q: Why do you think agencies want their own?
KING: I think some parts of HHS want to have control of the contract. And when you go to CIO-SP 3, you’ll pay a fee, so they may think they’re saving money by having their own acquisition and contracting organization.
It’s the same with VA’s $12 billion T4 contract; it’s going to be administered by VA’s acquisition center up in New Jersey. They had been using CIO-SP 2 and other vehicles, but now they won’t because they’ll be using their own. That’s a five-year contract, so if you want to play in VA, you need to win one of those awards and then compete on the task orders that come under it, and there will be hundreds of task orders that will be coming out across all of these vehicles. It’s going to be a very, very busy time over the next several years.
WT: What would you say is your biggest challenge today in health IT?
KING: I think the biggest challenge is trying to stay focused and bring the best solutions to our customers. Depending on the customer, there’s a whole range of significant challenges.
That could be budget challenges.
They may have acquisition challenges: What vehicles do they use if they don’t have their own or if they have their own, but just don’t have it in place yet.
Technology itself also can be a challenge -- [for example] maybe they’re locked into a technology and they need to get out of it.
Q: And the challenge at the top of the list will vary, at least in degree, from one agency to another.
KING: Yes, but it’s our challenge to take all of that into consideration and pull together the best solutions for each customer and do it in an expedited manner.
In bringing these integrated solutions to the table, however, is where leveraging the breadth of Northrop Grumman — taking technologies that are being used elsewhere and tweaking them and applying them to a health customer’s problem — is our biggest challenge. We’re trying to get our information out there.
WT: As broad a technology base as Northrop Grumman provides, you're bound to have partners, subcontractors, people you go to for additional resources you may need. How do companies find out what you might need and how do they best approach you to suggest a partnership?
KING: To solve our customers’ business problems, we bring together the best team possible. Depending on our customers’ needs, our partners could be product companies, other systems integrators, service-disabled and veteran-owned businesses, small businesses or universities. In many instances, our partners are already a part of our team for large IDIQ and/or GWAC contracts.
As the government customers issue task orders, we notify our teaming partners and work with them to determine the best fit to provide the required solutions and services. Alternatively, potential partners often reach out to Northrop Grumman through our online supplier portal OASIS
and share with us their subject matter and solution expertise that can benefit a customer and solve their business problem.
We also work proactively with service disabled and veteran-owned businesses as well as minority and women-owned small businesses to mentor and promote their services and feature them prominently in our proposals and projects.
WT: One last news item I wanted to get your response to: VA and the Defense Department have agreed on a single personal identifier for service members and veterans. That should make it easier for DOD’s Armed Forces Health Longitudinal Technology Application (AHLTA), which Northrop Grumman helped develop in 2005, to communicate with VA’s system.
KING: That’s definitely a step in the right direction. We have quite a few veterans who work at Northrop, and we hear quite a few stories about what they have to do to get their benefits, whether it’s education benefits or disability benefits.
WT: So you’re really motivated.
KING: It makes me think that we [at Northrop Grumman and other organizations] get a little — what’s the word? — complacent when we just go to our website and pick and choose our benefits.
But they have to call this number or go to that site; there’s no central place they can go or way to access their benefits. It’s quite cumbersome, so it’s nice that DOD and VA are moving in the right direction.
The whole Virtual Lifetime Electronic Record [VLER] program is going to be quite beneficial also. Whether it’s their personnel records, health records, information about their benefits, once the Joint VLER comes to fruition, it’s going to be quite powerful and useful for veterans and anyone in the military and their families.
WT: You’re right about things changing fast. A year ago, VLER seemed impossible. With the single personal identifier, military personnel can get some continuity when they leave active duty for veteran status.
KING: Not only that, but think of how many systems are involved and how they haven’t talked to each other. And now, because of this [push for] interoperability, not only will it all work together, we’ll also have a more informed consumer.
I see people carrying a whole stack of folders, X-rays, tests, records, just so they have all the information. Because a lot of people have had patient safety [and] medical error issues.
That’s another reason for the importance of interoperability and the need for sharing of information across systems. It really is a matter of life and death.