Cloud computing, also called Software as a Service or SaaS, has particular value in the healthcare industry.  It is inexpensive, ubiquitous, and secure.  All data and applications are stored on secure servers accessible from anywhere there is Internet access.

Healthcare IT is, as usual, lagging behind the rest of the universe.  We have taken this technology and applied it to several niches within healthcare.  Our particular focus is compliance.   There are many sets of rules promulgated by agencies such as Medicare which require all sizes and shapes of healthcare organizations to demonstrate that they are in compliance.  These are enforced through unannounced surveys and the consequences for failure are high. 

Recently Congress required Medicare to develop a program to decrease fraud and abuse and increase patient safety within the Durable Medical Equipment (DME) industry.  Ten agencies were given authority to develop standards and certify that their clients met these standards.  A cottage industry developed around helping DMEs prepare for accreditation surveys.  This primarily consisted of consultants offering manuals and on-site training.

“History tells us that major new growth markets coalesce when products, processes, and information technologies let less highly paid groups of people do things in more convenient settings.” By Clayton M. Christensen, Richard Bohmer and John Kenagy, Harvard Business Review, September-October 2000

Accreditation Helper developed a model called “Web Tools with a Human Touch” which used cloud computing coupled with a human “Helper” to offer advice and support.  Instead of high priced on-site consultants, the helpers work from home and are people who have worked in a DME and been through multiple surveys.  In the summer of 2007 the founders secured a leading edge software developer using the latest tools (Ruby on Rails), found a domain expert with both the content and the process needed, and built this new system.  Two years later hundreds of users use this on a daily basis and a recent customer satisfaction survey revealed that 98.8% of respondents would recommend, or already have recommended us to another provider.

Several new opportunities have presented themselves to our team.  Within the DME industry the focus is shifting to accreditation maintenance and we are in discussions with accrediting agencies concerning them adopting our cloud computing technology to help them manage their clients.  Our maintenance program gives each provider a monthly set of tasks to perform to stay in compliance.  As they accomplish these tasks, including QI studies, they sign off with a date, time, and person who accomplished the tasks.  They are then given a score for that month.  If they are at 90 or above they are ready for a successful unannounced survey.

And most interestingly there are new HIPAA requirements that will force hundreds of thousand of healthcare business associates to comply with new regulations.  We have recruited the domain expert, started loading the content, made an agreement with a marketing and distribution network, and have built the first version of Compliance Helper.

On May 28, 2008 Accreditation Helper (AH) received an email from Ed Barrett, VP Marketing, Care Rehab, www.carerehab.com  stating that they were looking for assistance in obtaining accreditation from CHAP.  Care Rehab offers a comprehensive line of safe, effective, easy-to-use, cutting edge medical devices, including traction products, electrotherapy products, biofeedback products and supplies, through a network of physical therapists and independent sales people.

Jack Anderson, CEO of AH contacted him and learned that their’s was an urgent need, due to a potential contract which required accreditation by September 15, 2008.  Jack suggested that The Joint Commission (TJC) accreditation would have a higher value to payers based on his experience negotiating contracts with payers such as Blue Cross, United, and Aetna.  Ed agreed to switch to TJC as the accrediting agency and signed a contract on June 26.

This was a large project with 10 users trained at Care Rehab using the step by step process and Internet delivery method of the AH system with a personal Helper, Jill Martin, assisting them. 

TJC assigned two surveyors for a five day survey due to the scope of the project.  At the end of this intensive survey Care Rehab had a perfect score with no Requirements For Improvement (RFI).  They were accredited as of September 12, 2008.

Ed said that they could have never made the deadline without AH tools, technology, and the support of their personal Helper, Jill Martin. They not only got that contract but have used their JCAHO accreditation as a tool to get several more contracts with private payers.

To protect this valuable asset Care Rehab has contracted for the Care, accreditation maintenance service from AH.  CMS and TJC both do unannounced surveys but with Care they are assured that are “Survey Ready” at all times.

http://www.cms.hhs.gov/MedicareProviderSupEnroll/Downloads/DMEPOSAccreditationMIPPA-FactSheet.pdf

 This leaves very little leeway for those who have not yet started.

The director of ACHC predicts that there are 30,000 DMEs still to be accredited which means over 2,000 per month for the next year.  Good luck!

I have been guessing that the number of unaccredited DME that will have to get accredited is 20,000; however ACHC was recently quoted in HMEnews as saying it is 30,000.  That means that the accreditation industry must handle somewhere around 2,000 per month for the next twelve months.  This going to be crazy and believe me you don’t want to be in the last group trying desparately to get surveyed.

An interesting new situation is that we are being approached by physican offices that want to get their DME operation accredited.  Apparently in the past physicians felt that they could dispense DME products without being accredited, but CMS has now made it clear that anyone wanting to bill Part B for products and services that come under the heading DMEPOS, which stands for Durable Medical Equipment, Prosthetics, Orthotics, and Supplies must get accredited.

With reimbursement shrinking everywhere I am sure that we will see a large number of orthopedic and podiatric offices wanting to tap into this revenue stream.  It could set up a awkward situation for those physicans who formerly referred these patients to a DME provider.  Of course the DME provider has a new challenge here also.  After nearly forty years in healthcare I shouldn’t be surprised at the the byzantine nature of this sector but here is another example.

So you will have to get accredited but it does not have to be a burden.  Done correctly accreditation can make your business operate more efficiently, increase staff morale, raise your image within your community, and make you more money.

That sounds like a tall order but in my seven years of helping healthcare facilities get accredited, 90% have reported these improvements after going through the accreditation process.  There are always 10% who don’t get the message, but we will assume that you are not in that group.

How does this work?  Good business processes need to be embedded in your organization through written policies and procedures.  This is the core of the accreditation process.  Employees need to know these, follow them in their daily duties, and know where to find them when they have questions. 

Quality improvement is an essentil element of accreditation.  As you are working on QI you will acquire data which will tell you the level of quality you have achieved.  This can be used to tell payers, patients, and providers that you are a high quality organization.

By networking with other accredited DME companies it is possible to get private payers to admit you to their networks.  This quality network can also bring new revenues to you from referring physicians and hospitals.

My next blog will talk about why you should get accredited by the biggest, oldest, and best recognized accrediting body, The Joint Commission or JCAHO.

In general everyone I talk to has accepted accreditation as a necessary and reasonable requirement for DME providers.  The two major short terms benefits will be driving the bad actors out of business as well as the very small providers who were basically dabbling in DME as a side line of business.  This could result in as many as 40,000 fewer supplier numbers in the industry which should be beneficial to the survivors. 

I will write next on the potential impact of accreditation on a provider and the beneficial aspects of accreditation above and beyond getting to keep your supplier number.

This triggers some interesting dynamics for those who are just getting started on the process of preparing for survey.  It takes months to prepare so most will not be ready by May 14, but if they apply before they are ready they run the risk of an unannounced survey before they are ready.   Undoubtedly we will see a lot of risk takers apply just before the deadline and then cross their fingers or perhaps say an extra prayer.

The October 31 deadline is really immaterial.  If you applied on May 14th or before you will probably be surveyed long before then.

The big question for the agencies and those of us who help with preparation is how many are going to show up between now and May 14th.  It should be thousands and I am not sure the industry is ready for that.  We have an advantage with our web approach because it is much easier to scale up than an on-site approach.  The people selling policy and procedure manuals will get an initial rush but many of their clients end up needing more help.

Now all we need are the numbers from the 2007 contracts so people can try and figure out whether the margins are sufficient to support their business models.  I would expect a large droput rate and then new providers with newer business models entering the market.

At any rate, let the games begin.