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IT Decisions Hang On Supreme Court Healthcare Ruling (InformationWeek)

Supreme Court's ruling on the constitutionality of healthcare reform legislation could influence the direction of health IT.

March 28, 2012 01:00 PM

Marianne Kolbasuk McGee
Senior Writer, InformationWeek  

It seems like healthcare providers are always faced with uncertainty. That uncertainly has reached a tipping point this week as the Supreme Court hears arguments over the constitutionality of healthcare reform's mandate for U.S residents to purchase coverage. How does all this uncertainty impact healthcare providers' IT plans? That depends.

Most of the big government mandates that healthcare providers are struggling with right now from an IT perspective aren't directly linked to the Patient Protection and Affordable Care Act signed into law in 2010. In fact, the biggest government-related IT burdens on healthcare providers come from other legislation: the HITECH Act's program that encourages the adoption and Meaningful Use of health IT systems, including electronic medical records. For now, financial incentives are being awarded to healthcare providers who comply with MU, but financial penalties will begin kicking in for those who don't adhere after 2014.

More burdensome than the Meaningful Use programs, however, is the mandate for ICD-10 conversion, which greatly expands the number of diagnostic and in-patient procedures that billing, clinical, and other systems use. As most health professionals know by now, the deadline for ICD-10 is currently in limbo. While the ICD-10 conversion deadline had been set for Oct. 1, 2013, the Centers for Medicare and Medicaid Services announced last month that it will extend the deadline, but the new date hasn't been set yet.

This all amounts to plenty of tech-related pressures and uncertainties for healthcare providers to work through on top of all the other issues they're dealing with, both IT- and non-IT related.

Uncertainty about healthcare reform's fate isn't exactly new. Opponents and proponents for change have been fighting their causes long before and after the legislation was signed into law. What's new is that the Supreme Court is finally hearing the arguments, and it is expected to rule by June on whether or not to keep the individual mandate provision, and whether or not the rest of the legislation might get overturned in the process. The activity in the Supreme Court is like a drip of cooking grease on a smoldering barbeque: Just before that sudden burst of flame subsides, all you can do is guess how the steak will turn out. Is it so overcooked you need to throw it out and start over, or is it something you can work with?

Even if healthcare reform is overturned, the IT-enabled transformation that's been underway with many healthcare providers will likely continue.

"It's important to remember that there are Accountable Care Organizations--with capital letters--from CMS, and accountable care that the industry has been moving toward with pay for outcomes, pay for performance, value-based purchasing," said Dr. Harry Greenspun, senior advisor for healthcare transformation and technology at Deloitte Center for Health Solutions.

Being paid for performance and for the outcomes of patient populations, including those with chronic diseases like diabetes, requires healthcare providers to share risk. But "in order to take on risk, you need to collaborate, coordinate, and analyze," said Greenspun in an interview with InformationWeek Healthcare. "The more you collaborate, the more risk you can take on, and that's driving a lot of the push for doing more in IT, EMR, data sharing."

Regardless of what happens with the Supreme Court, some healthcare providers--including some that are part of CMS's Pioneer ACO program that was created under healthcare reform--are set to move ahead with the IT-fueled transformations they already have underway.

"As one of the Pioneer ACOs--five of the 32 are in Massachusetts--Beth Israel Deaconess [Medical Center] believes that global payments, risk, and reimbursement based on quality are the future, regardless of the Supreme Court actions," said Beth Israel Deaconess CIO John Halamka in an email interview with InformationWeek Healthcare. "Hence we've invested in healthcare information exchange, data aggregation, and business intelligence tools that will enable us to coordinate care and keep our patients well instead of just treating them when they are sick," he said. That focus will continue at BIDMC.

But IT-related investments needed to fulfill other parts of healthcare reform's mandates are shakier for some organizations since it's uncertain whether the business initiatives tied to them will move forward.

For instance, when it comes to the IT investment needed by states and payers to build state health insurance exchanges that allow the uninsured to shop for insurance under the current individual mandate, well, that's up on the air.

"When you parse out what's part of state insurance exchanges, you need to set up online services, link with tax records, and more--there's tremendous work involved," Greenspun said. Even if the mandate stands, "states could hedge their bets and look to the feds to run their exchange," he said.

Still, even if the law is overturned and there is no longer an individual mandate compelling the uninsured to purchase coverage, states and healthcare providers will be left dealing with their own budget nightmares, including tightening Medicaid funding and unrelenting doubt about getting paid for treating the poor and uninsured.

"There's uncertainty in the payment atmosphere and budgets," and that impacts IT planning, said Greenspun. "It's a difficult time for decision making."

Once the Supreme Court makes its ruling, however, some of that uncertainty will lift, and healthcare providers should have a less hazy view about the direction they need to go and how to proceed with IT for their own transformation.