Kaiser Permanente Contract Drives Connectivity and Interoperability

Caryn M. Silverman

July 1, 2007

6 Min Read
Kaiser Permanente Contract Drives Connectivity and Interoperability

In the past, medical device manufacturers may not have paid much attention to the surging importance of healthcare information technologies (IT) or to the growing trend toward greater connectivity and interoperability among medical technology products. But language now being included in vendor contracts by Kaiser Permanente (Oakland, CA), may make it a lot more difficult for medtech companies to ignore those trends.

Kaiser Permanente is an integrated managed care organization that employs almost 13,000 physicians and operates 37 hospitals in nine states. In the past year, the organization has introduced into many of its contracts with medtech manufacturers language that, in effect, holds the manufacturer responsible for ensuring the interoperability of its devices with the hospital's clinical information system.

Although the particular language started showing up in contracts more than a year ago, Kaiser's policy is not yet widely known in the medtech industry. In response to queries, Kaiser confirmed the presence of the contract language, but declined to comment further on the initiative. A portion of the new language reads as follows.

Supplier agrees to participate with [Kaiser] in the development of a medical device plug-and-play integration standard (the 'integration standard'), and where, in supplier's sole judgment, it determines participation to be commercially, legally, practically, and otherwise viable, will make reasonable efforts to conform to the integration standard when approved and formulated by the parties in writing. Until the integration standard is approved and formulated by the parties in writing, supplier intends to continue . . . to provide open interfacing protocols to enable third parties and end-users to access data from its products, as defined in the agreement.

The contract language acknowledges that there is no common industry standard for medical device integration, but requires medtech manufacturers to demonstrate that their products can be successfully interfaced with Kaiser-designated third-party solutions to achieve network interoperability.

One of the primary objectives of Kaiser's medical device plug-and-play contract language is to ensure device interoperability with the organization's electronic medical record (EMR) system. Kaiser's HealthConnect is the largest privately run EMR in the world. It is essentially a rebranded system manufactured and deployed by Epic Systems Corp. (Verona, WI).

The contract language also stipulates that the supplier must demonstrate successful device interoperability through testing at a Kaiser-designated facility or an approved independent lab. If the medical device fails to communicate adequately on the network, the hospital can request to have it removed at the manufacturer's expense.

Gee:Radical stuff.

Tim Gee, principal of Medical Connectivity Consulting (Beaverton, OR) describes the potential impact of Kaiser's move as "huge." Gee expects other hospitals to follow suit and says that a large, prestigious medical center in the northeastern United States is expected to announce a similar program shortly. " This is radical stuff that places the systems integration role firmly on the shoulders of the medical device vendor," says Gee.

At a conference earlier this year, Julian Goldman, MD, an anesthesiologist at Massachusetts General Hospital and founder of the Medical Device Plug-and-Play Interoperability Program (both in Boston), cited a Kaiser study indicating that device interoperability would improve patient safety, efficiency, and overall quality of care while offering significant savings. However, Kaiser also notes the significant cost of implementation and deployment—more than $10,000 per bed. The hospital chain projects that over the next 10 years it will spend $100 million annually to update devices and technology infrastructure to achieve connectivity. Having a common device communication standard would reduce costs by 30%, according to Kaiser.

Goldman:Cooperation needed.

Goldman notes that achieving industry standards for systemwide connectivity and device interoperability "won't be easy—and it won't be cheap." The Medical Device Plug-and-Play Interoperability Program, along with other organizations, is actively shaping national standards that will be acceptable to both medical authorities and participating device manufacturers. "To make this work, we need the cooperation of institutions, device makers, medical professionals, and other stakeholders," says Goldman.

Device manufacturers have traditionally not been active participants in standards development for medical IT initiatives or at forums on clinical connectivity and device interoperability. Over the past year, medical device companies have seemed to be paying more attention to activities in this field. Nevertheless, says Gee, "While there may be more names on association rosters, if truth be known, the number of active medical device manufacturers in this arena is less than 10."

It's no secret that the medtech industry has traditionally preferred proprietary standards that, in effect, impose a single-vendor solution on a hospital or healthcare facility. But now, hospitals are balking at this traditional practice of medical device companies. They want open standards as they implement vendor-neutral clinical information networks.

Many medical devices are interfaced with hospital clinical information systems and electronic medical record systems by third-party systems integrators that, in essence, can tweak a device's particular application programming interface (API) or hardware ports to achieve communications capability with other devices on the network. Until industrywide device interface standards are agreed upon and developed—which may be a long way off—this interim solution will likely prevail.

Providers of medical device data integration products and services include such companies as Capsule Technologie (Paris), Digi International (Minnetonka, MN), iLink Systems (Bellevue, WA), HEI (Minneapolis), InterSystems (Cambridge , MA), NeoTool (Plano, TX), Sensitron (San Mateo, CA), and others. While most of these are proprietary solutions, the open-source community is also getting involved in medical device integration.

Teichrow:Cooperation needed.

Mirth, an open-source, cross-platform interface engine, is described by its developer, WebReach Inc. (Irvine, CA), as an HL-7 interface engine with the usability of a Swiss army knife. (HL-7 is the dominant data exchange messaging standard in the healthcare industry.) According to WebReach president Jon Teichrow, "Mirth is the most widely downloaded open-source software for health information exchange. Mirth appliances, combined with our open-source software, enable organizations to quickly upgrade the healthcare enterprise with a dedicated HL-7 messaging infrastructure."

Teichrow says that most of his business comes from hospital IT departments, but he is getting an increasing number of requests from medical device manufacturers with questions about connectivity and device interoperability. The company expects to announce a 'solutions provider' contract with a major medtech firm soon. Teichrow also notes that medical OEM versions of Mirth solutions could be readily developed.

It is expected that more hospitals will follow Kaiser Permanente's lead in placing the responsibility for clinical connectivity and device interoperability directly on medtech vendors. Manufacturers will need to take a more active role in addressing these issues—lest they lose out to competitors who recognize the profound significance this development, which WebReach's Teichrow calls a "sea change."

© 2007 Canon Communications LLC

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