Report Lauds Infotech for Health Care

Council on Competitiveness says infotech can help health-care providers supply better, cost-effective care

P> With technology getting blamed for recent corporate downsizings, the Council on Competitiveness has news about the role of technology as a force for good. According to a report released by the council, information technology can help doctors and other health-care providers supply better and more cost-effective patient care. The Washington, D.C.-based council released "Highway to Health: Transforming U.S. Health Care in the Information Age," at a March news briefing.

"Our study, we believe, offers real solutions to health-care problems," said John Yochelson, the council's president.

The report suggested that information technology can immediately improve health-care delivery and reduce costs. Among the top dilemmas that confront health-care providers is the lack of information systems integration across the industry. The report calls mostly for a market approach to applying information technology in the health-care industry. It also calls for government action to clarify public policies to enable the private sector to develop new technology, such as software tools for medical diagnoses.

The failure of health-care providers to purchase information systems and to adopt integration strategies is cited as a major factor in driving up health-care costs and creating inefficiencies among health-care providers.

According to the report, the health-care industry has not invested as high a share of revenue in information technology as other information-intensive industries, such as banking and finance. A survey cited in the study showed that the top systems spenders in the banking industry invested 5 percent of revenues on information systems. The top spenders in the financial industry invested an average of 7.5 percent of revenues on infotech. In contrast, the major health-care companies spent only 1.8 percent of revenue on information technology.

Failure to integrate information systems among major health-care providers and companies has led to increasing administrative costs and errors. The report cited a survey that showed 11 percent of laboratory tests are reordered because of lost results, and 30 percent of treatment orders are not documented at all in American hospitals and clinics.

The report said the model for health-care decision-making is one of decentralization, and individual medical departments tend to address only their own needs.

"We need to link these islands of automation together," said Richard Barker, general manager of the Healthcare Solutions division at IBM.

Barker said the federal government can spur the private sector to adopt information technology through its role as a purchaser of services, rather than as a regulator.

Another dilemma in medical research is the Food and Drug Administration's lack of definitive regulation on medical decision-support software.

FDA rules discourage medical researchers from sharing medical decision-support software. The FDA announced in May 1995 that it would modify previously published draft policies, according to the report.

"This is clearly a case of technology outstripping regulation," said Rosenman, the leader of the team that completed the medical research and education portion of the study.

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