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Health IT startups welcome at health systems, if they can show value

Coming up with an idea for a business is tough enough. Making a sale is a whole different ballgame, particularly when it comes to health IT and a rapidly consolidating market filled with massive health care systems.

Phil Loftus
"We actually get hundreds of approaches every day from vendors trying to sell us something," said Philip Loftus, CIO of Aurora Health Care, a 15-hospital organization based in Milwaukee.

Loftus and three other healthcare CIOs discussed how entrepreneurs can get their attention and engage health systems in pilot technology projects in a session at the Start Me Up Emerging Healthcare IT Meetup Day prior to the start of the 11th annual WTN Media Digital Health Conference this month. Their advice? Show value. Know the organization's needs. Approach the right person. Make it easy for the implementation team and the end user.

GeneThomas
"It starts with value," advised Gene Thomas, CIO of Gulfport Memorial Hospital in Gulfport, Miss. "I don't have a lot of time to spend on something that doesn't have a quantitative value proposition that's fairly predictable and fairly obvious to understand."

He also does not have a lot of money to spend in the current environment, particularly since Gulfport Memorial is heavily reliant on government payers. "Almost everybody in healthcare is making money except the providers," said Thomas, himself a former entrepreneur.
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"It's a tough market out there if you're trying to sell into institutions that happen to have a high payer mix that Medicare and Medicaid. You're going to need to make sure that you show the value," Thomas said.

Loftus agreed. "Increasingly what we are focused on is the value proposition we get from our investments in IT. We see IT as a real value for the organization," he said.

According to Loftus, value does not have to be in the monetary sense as long as it addresses an institutional goal or need. It could mean improving outcomes, boosting patient satisfaction or reducing length of stay.

"The more you can link a proposal to one of those goals and a measurable outcome against it, I think that's going to be the most likely thing to drive us in terms of both getting our attention and ultimately in getting our dollar of investment," Loftus said.

Thomas noted that diabetes, obesity and hypertension are rampant in southern Mississippi. He said an outside group approached Gulfport Memorial's diabetes care group with better analytics and better ways to control patients, so that company partnered with physicians on the medical staff. "They actually moved the needle, so we are probably going to bring that project in-house," Thomas said.

As a single hospital, Gulfport Memorial might be easier for a startup company to approach and navigate. That also appears to be the case at Fort HealthCare, a small provider in Fort Atkinson, Wis. "We are a very good test-bed site just because of our size. We can do a lot of things very quickly and easily and rapidly," said Fort CIO James Dahl.

Like the others, Fort is looking for value from its IT investments. "As the cost constraints continue to hit all of us, I think it's shifting the paradigm for us a little bit in terms of we can do less with less." Fort may cut back in some areas, but also might be looking for "what's good enough" with new approaches, Dahl said.

"It gives us opportunities, especially for startups and creative thinking, to do things differently," Dahl explained.

Still, the CIO might not be the best person to approach with an IT idea.

"It depends on what the solution is," said Dave Lundal, vice president and regional CIO for Dean Clinic in Madison and the related SSM Health Care of Wisconsin.

Lundal said he usually focuses on the larger business initiatives, such as business intelligence and telehealth. "In that situation, I'm not a bad person to start with," he said.

"There are a lot of other aspects, though, of technology that we're doing across our organization that I am not the best person to start with because, A, my time is consumed with these other things and, B, there are people that can really identify what the value is, what the pitch is, and they can negotiate ways to get this through the organization," Lundal explained.

At Aurora, Loftus said he rarely gets to make the final decision on IT purchases. "The most common decision-makers in IT would be the area VPs, particularly for the big projects, but for some of the small projects, it can also be the [program] directors or the managers who become enthusiastic about them," Loftus explained.

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