Jacob Reider M.D: CMIOs Need To Be True Transformational Leaders

Since leaving his position as Deputy National Coordinator for Health IT and CMIO at the Office of the National Office Health IT in October 2014, Jacob Reider, M.D. has been consulting widely in healthcare, including with a few healthcare IT vendor startup companies, as well as speaking widely at conferences, and continuing to participate actively in the healthcare policy arena.

At a time when the policy and reimbursement landscape is shifting very rapidly in healthcare, and when clinical informaticists, including CMIOs, are becoming more and more essential to transforming U.S. healthcare delivery, Dr. Reider spoke with HCI Editor-in-Chief Mark Hagland just shortly before the members of AMDIS—the Association for Medical Directors of Information Systems—hold their annual Physician-Computer Connection Symposium, to be held, as in past years, at the Ojai Valley Inn and Spa in Ojai, California, this time June 24-26. Below are excerpts from that interview.

It seems in some ways as though we’re at an inflection point in the journey towards the new healthcare, with regard to tipping forward into accountable care, population health, and other concepts in a bigger way. What are your thoughts on all this?

I would agree that we’re migrating towards different cultural norms that would align with the principles of value-based care. And I think we see two different possible scenarios emerging and possibly merging. One involves fully engaged, all-in, entrepreneurial thinkers, who are just doing it, in terms of value-based care. Examples are [the Miami Gardens, Fla.-based] ChenMed Health, [the Seattle-based] Qliance, and [the Cambridge, Mass.-based] Iora Health. Those are three organizations, each run by a visionary leader who wants to align their organization with the best interests of the individual—notice that I don’t say patient. So when the individual’s needs are perfectly aligned with the business interests of everybody taking care of their health, then everything fits together, and an amazing transformation occurs.

Some people have talked about the “quadruple aim”—the “Triple Aim,” plus a fourth aim, provider happiness, in addition to better care, lower cost, and a better patient experience. And ultimately there is also patient happiness… and maybe even payer happiness and UPS driver happiness! Are there others in the continuum whose happiness we should care about? Yes. Still, it’s not necessary to focus too much on provider happiness; I’m saying if we focus on that, we miss big-picture aims. Instead, if we align everything correctly, the providers will be happy.

And in those three organizations, one immediately recognizes that something is different. The atmosphere is lighter. You don’t see patients arguing with someone at the front desk. And often, the patients are happier because the providers are coming to them, sometimes virtually. And interestingly, every one of those organizations, they’ve created their own IT solutions to support patients, rather than to maximize reimbursement. People talk about note bloat, and doctors are getting 10 pages of documentation from the ER, and doctors can’t even figure things out. We’ve built solutions designed to solve the problem of needing to maximize billing.

But by thinking about this differently, they’re doing something different. They’re building solutions themselves around individuals, or patients. Not around billing. The difference is that we have the IT now. In the capitation of the 1990s, we couldn’t truly build IT-facilitated care systems that we can now. We didn’t have the IT infrastructure; it wasn’t as fluid, flexible, or ubiquitous. Now people are carrying computers in their pockets; their called phones. But they’re 10X as capable as the desktop computers of ten years ago. So there are going to be these little all-in activities and they’ll spread in a sort of michotic way. They’ll sort of bubble up, split in half, and replicate themselves all over the country.

And these all-in folks will attract clinicians, patients, and payers. That will be the revolutionary migration towards value0based care. Everything will be new, and those who join those organizations will be joining organizations that will be transforming everything.

The other trajectory is the evolutionary migration towards value-based care through accountable care vehicles. And while that will work, it is not sufficient to get there in the new term. I would say a seven-to-ten-year path towards the Triple Aim.

Those truly revolutionary organizations are smaller and less-known, then?

Yes, and that’s OK. Honda was smaller and less-known in 1973, right? I’m a big fan of Clay Christensen [Clayton Christensen, the Harvard Business School professor], and his model of disruptive innovation. It is in fact the small, disruptive leapfrogger, that defines the future, right? Look at Apple, compared to IBM and Microsoft. There was no way that Apple was going to disrupt IBM and Microsoft, right? But who has the biggest market cap [market capitalization] now? Other examples: Canon and Xerox, and Elon Mosk and the Tesla.

Are you at all concerned about the ongoing consolidation taking place among both healthcare provider organizations and health plans? Is all this bulking up a misdirection of energies in the current healthcare landscape?

Not at all. Christensen would predict exactly this. The incumbent markets are very strong and in fact will consolidate, because as margin starts to erode, there is a pressure for the smaller and less efficient markets to consolidate. Look at U.S. Steel in the 1970s, a consolidation of many smaller companies, and yet they were disrupted by a t8iny steel company called NuCor, which had massively lower overhead.

So we’ll continue to see consolidation, but then decreasing agility on the part of the incumbents, and then disruption from smaller players. The incumbents will say, they’re too small, they’re operating on a 7-percent margin and we’re operating on a 32-percent margin. But then what happens is that Iora grows and grows and grows.

But this dynamic has been borne out in market after market after market. So we’ll see both. And nobody at Epic or NextGen or Allscripts or eClinicalWorks is making a bad decision; they’re making good decisions at the market they see. But the market is becoming saturated. And the government is getting concerned now over “information-blocking,” but in fact, it’s not information-blocking, but the fact that vendors are charging to turn on aspects of capabilities, because their margins are going down. But that’s unsustainable, because there are companies that are commoditizing the market for interfaces. So we will see the interoperability costs way down, and will imperil the big EHR companies. So you’re seeing that Epic has changed their fee structure for exchange of clinical documents with non-Epic facilities; they had previous charged a transaction fee, so that if you wanted to send data to a non-Epic environment or receive data from a non-Epic environment, they used to charge a transaction fee. They have eliminated that fee. I don’t know why, but suspect it’s because of pressure they’ve been receiving. They’re doing fine financially, but companies that do rely on fees like that for transactions will be threatened, because the market simply won’t tolerate that.

Where do you see CMIOs in this whole landscape? How do you see the CMIO role evolving forward in all this?

I agree with you that it’s evolving. And I also agree that the right person for the CMIO role is no longer the technical expert, or even as it was very recently, the bridge between the CIO and the physicians. Two years ago, David Muntz and I spoke at AMDIS. And what we were groping for was, how does the CIO-CMIO relationship fit into tomorrow’s IT world? Because this is really, really hard. As you know, the CIO has been bred differently from the CMIO; they think differently, have been trained differently, and focus on different priorities. No one’s right or wrong. But they need to work together, because these two cultures of, essentially, technical plumbing and clinical optimization, need to be working together towards the right new tomorrow.

So if the right new tomorrow is a care delivery setting that truly focuses on the best interests of the individual, and these two individuals are aligned with that, then things can be great. But if the CIO reports to either the CFO or COO, which often happens, those people in those titles are focused on revenue, and focused on this quarter’s revenue, and maybe, if they’ve got a really long view, this year’s revenue. And in fact, their performance is assess based on revenues. It may or may not be based on anything clinically significant.

But of course with readmissions reduction and value-based purchasing under the Affordable Care Act, even CFOs’ minds are changing now, correct?

Oh yes, I agree. They are beginning to think about these things. So yes, readmissions is one silo they have to think about. And quality measures are another silo. And your Inpatient Quality Reporting Scores, and your outpatient PQRS, are becoming increasingly become important, and private payers are increasingly focus on all that, too. But still, we’re talking about silos of quality, and for wont of better vocabulary, people are checking off boxes and treating to the test. An example of that is the bundled payments program, which has been extraordinarily successful, and they’re reducing costs for specific bundles by up to 40 percent; but where there aren’t bundles, no change is occurring.

So the system has definitely demonstrated, through slivers of activity, that transformational change can take place. So everything is completely fragmented. And my front-desk person doesn’t know how to respond. If a patient is in a value-based program, I want to send them to a nurse and have them drink lots of orange juice, and if they’re FFS, we want to bring them in right away; but that’s nuts. It’s the schizophrenia of the migration towards value-based care that we’ll be managing, in an evolutionary setting, whereas in an all-in organization like Iora, you don’t have that conflict.

So back to CMIOs—the CMIO needs to be a true leader in helping their organization migrate towards that transformation. So it’s about defining a vision and inspiring everybody to let go of the traditional ways in which they’ve defend their businesses, and really inspiring people to get fired up about what’s best for the individual. And the CMIO knows what’s possible and not, and shouldn’t set expectations beyond the possible, in medicine or in IT. And they went to medical school to help people. And it’s about making communities healthier. So when the CMIO weaves those two attributes together—the attribute of knowledge of information technology, and the attribute of knowledge of what’s possible in medicine, as well as the passion—they really can help transform organizations in the service of the health of communities. Not more health care, more health.

What’s your sense of CMIOs’ preparedness for this, as a group?

I can’t give a percentage, of course, but every year, I’m seeing the CMIOs getting closer and closer to being visionary, inspired, thoughtful, humble guides towards perfection in health. That’s what we’re seeking. I see the CMIO evolving towards that, and of course, it’s a challenge for many, because this may not be the role for which they’re hired. They may have been hired to placate the physicians, get the install done, and manage the doctors. So if they were hired to do that, it then is harder for them to build the confidence of senior leadership, yet many times, I’ve seen them do this over and over. When they become the lightning rod for inspiration of the CEO, medical staff, and community leaders, they show what’s possible.

And the CIO-CMIO can be transformational together.

Yes, absolutely. But it takes a special CMIO to do that and a special CIIO to do that.