Microsoft PowerPoint - Sachs_The Role of by Jose Vallejo

The Future of Emergency Care in the United States Health System The Role of Technology on Future Emergency Care Michael A. Sachs Chairman msachs@sg2.com June 25, 2004

1560 Sherman Avenue

Evanston, Illinois 60201

www.sg2.com

Agenda Sg2…Who We Are Future Demand on Emergency Care Technology Solutions to Care Delivery Challenges The Path to Change

Agenda Sg2…Who We Are Future Demand on Emergency Care Technology Solutions to Emergency Care Challenges The Path to Change

Sg2’s Focus

What’s Going to Happen When It’s Going to Happen What’s the Impact … and the actionable strategies

Sg2 Team Covers the Industry Publicly Publicly Available Available Utilization Utilization Data Data Sets Sets

Demographic Demographic and and Sociocultural Sociocultural Data Data and and Research Research

FDA FDA CMS CMS

Claims Claims Database Database

Impact Impact of of Change™ Change™ Database Database and and Edge Edge Analysis Analysis

Clinical Clinical and and Management Management Conferences Conferences

Clinical Clinical Advisors Advisors and and Clinical Clinical Experts Experts at at Member Hospitals Member Hospitals

Example

Annual Growth Rate for CT Angiography

Benefit Design and Impact of Consumer-Driven Health Plans

Timing and Volume Impact of Evolving Minimally Invasive Surgical Approaches

Impact of Change™ Model

Population

Economy

Impact of Change™ Forecaster

Inpatient Inpatient Discharges Discharges and and Days Days

Sociocultural Payment Technology

Emergency Emergency Department Department Visits Visits

Outpatient Shift

2002 - 2012

Outpatient Outpatient Volumes Volumes

Sg2’s Edge Core Topics Clinical Services

Economics and Payment

Organization and Delivery

Cancer Care Cardiovascular Services Chronic Diseases Imaging Services Infectious Disease Neurosciences Orthopedics Pediatrics Surgical Services Women’s Health

Commercial Health Insurance Consumer Driven Health Plans Disease Management Health Care Economic Forecast Medicaid Medicare Payment Patient as Payer Payment for Technologies Payment Redesign

Clinical Enterprise of the Future E-Care: Telemedicine Emergency Departments Intensive Care Unit Lab of the Future Medical Privacy Medical Workforce Outpatient Care Pharmacy of the Future Physician Organizations Point of Care Technology Procedure Centers Self-Care Specialty Hospitals Wiring Clinical Care

Agenda Sg2…Who We Are Future Demand on Emergency Care Technology Solutions to Emergency Care Challenges The Path to Change

ED is a Window on the Community Economy Sociocultural

Population Care Organization

Consumerism

Medical Practice

Technology

Competition

Confidential and Proprietary ÂŠ 2004 Sg2

EDs Serve Multiple Patient Types Types of ED Patients

Current Major Emergency Care Issues

Trauma and Accidents

Inappropriate Utilization

Acute Medical Insults

Medical Errors

Chronic Conditions

Delays in Treatment

Primary Care (Non-emergency)

High Costs

Confidential and Proprietary ÂŠ 2004 Sg2

ED Visits are Increasing Emergency Department Visits US Market, 1992-2002

1992-2002 23% Total Growth

Visits (Thousands)

120,000

As Compared to 10% US Population Growth

100,000

80,000

60,000 1992

1993

1994

1995

1996

1997

1998

1999

Sources: Division of Care Statistics, National Center for Health Statistics; CDC NHAMCS 2002 ED Summary, 2004; US Census Confidential and Proprietary ÂŠ 2004 Sg2

2000

2001

2002

ED Use Rates are Also Increasing Emergency Department Use Rates US Market, 1992-2002 Number of Visits Per 100 Persons Per Year

1992-2002 9% Total Growth

25 1992

1993

1994

1995

1996

1997

1998

Sources: Division of Care Statistics, National Center for Health Statistics; CDC NHAMCS 2002 ED Summary, 2004 Confidential and Proprietary ÂŠ 2004 Sg2

1999

2000

2001

2002

EDs Treat a Broad Range of Problems Emergency Department Visits by the Top 20 Diagnoses US Market, 2002 (Millions) Injury Other upper respiratory infection Abdominal pain Chest pain Otitis media Headache Back problem Urinary tract infection Viral infection Other lower respiratory infection Asthma Skin infection COPD Allergy Fever of unknown origin Gastrointentinal Pneumonia Bronchitis Nausea/vomiting Dysrhythmia

30.6 6.7 4.0 3.1 2.7 2.7 2.6 2.3 2.1 2.0 1.9 1.8 1.7 1.4 1.4 1.3 1.3 1.2 1.0 1.0

Sources: CDC NHAMCS: 2002 data; Sg2 Analysis, 2004 Confidential and Proprietary ÂŠ 2004 Sg2

Top 20 diagnoses represent 66% of total ED visits.

Treatment for Complex Medical Problems Can Be Expedited Emergency Department Average Hours Per Visit* by the Top 20 Diagnoses US Market, 2002 (Hours) Injury Other upper respiratory infection Abdominal pain Chest pain Otitis media Headache Back problem Urinary tract infection Viral infection Other lower respiratory infection Asthma Skin infection COPD Allergy Fever of unknown origin Gastrointestinal Pneumonia Bronchitis Nausea/vomiting Dysrhythmia * From arrival time to discharge time Sources: CDC NHAMCS: 2002 data; Sg2 Analysis, 2004 Confidential and Proprietary © 2004 Sg2

2.3 2.2 4.3 4.7 2.0 3.0 2.8 3.7 2.9 3.7 3.1 2.9 2.9 2.0 3.8 3.3 4.3 2.7 3.1 4.4 14

Average = 3.2

Technology Examples to Reduce Treatment Time

CT angiography

Rapid diagnostics

Handheld/portable ultrasound

Functional MRI

Electronic medical record

Clinical decision support system

ED Utilization is Driven by the Elderly and Young adults Emergency Department Use Rates US Market, 2002

Visits per 100 Persons Per Year

70 61.1 60 50 40

39.7

43.6 39.2

37.5

Overall ED Use Rate 38.9

30.1

30 20 10 0 Under 15

15-24

Source: CDC NHAMCS 2002 ED Summary, 2004 Confidential and Proprietary ÂŠ 2004 Sg2

25-44

45-64

65-74

Over 75

Aging Will Increase Utilization and Acuity of Care Elderly* and Upper Middle-age Population US Market, 1970 - 2050

Population (Millions) 140

Age 55-64

Age 65-84

Age 85+

120 100 80 60 40 20 0 1970 Elderly* as % of 9.8% Total Population

1980

1990

2000

2010

2020

2030

2040

2050

11.3%

12.6%

12.4%

13.0%

16.3%

19.7%

20.4%

20.7%

Note: Data for 2010 – 2050 projections based on Census Bureau’s Interim Projection by Age, Sex, Race, and Hispanic Origin Source: U.S. Census Bureau *Elderly population consists of both the 65-84 and 85+ age cohorts 16 Confidential and Proprietary © 2004 Sg2

Cardiovascular Disease Prevalence Will Increase Projected Population with CVD (millions) US Market, 2000–2010 Male 31

Female 33

CVD prevalence grows by 18% as “Baby Boomers” reach 65+ years.

2000

2010

Neurological Disease Prevalence Will Increase Number (Thousands)

Overall Disease Prevalence US Market, 2000 â&#x20AC;&#x201C; 2010

9,000

2000

2005

2010

8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Parkinson's Confidential and Proprietary ÂŠ 2004 Sg2

Epilepsy 18

Stroke

Alzheimer's

Patients with Multiple Diseases Will Also Increase Growth in Chronic Disease, 1995-2030 Number of People with Chronic Conditions

180 Percent of the 49.2% Population with a 170 48.8% Chronic Condition 171 48.3% 160 164 47.7% 157 150 47.0% 149 140 46.2% 141 45.4% 130 133 44.7% 125 120 118 110 100 1995 2000 2005 2010 2015 2020 2025 2030 Sources: Rand Corporation; Partnership for Solutions Confidential and Proprietary ÂŠ 2004 Sg2

Poor patient management of chronic diseases and poly-pharmacy issues attribute to increased ED utilization.

Hospital Quality Initiatives Will Reduce ED Readmissions Hospital Quality Initiative (HQI)

Source: CMS Confidential and Proprietary ÂŠ 2004 Sg2

Growing Health Care Costs Have Led to Insurance Changes Annual Employment Cost Trends 1982 – 2003

Annual Percent Change

25 20 15 Health Insurance

10 5

Total Compensation GDP

0 1982

1985

1988

1991

1994

1997

2000

ED utilization by insured persons will continue to increase: Patients rejected from the managed care gatekeeper models Accessibility to treatment Reduced access to primary care physicians Sources: (GDP) Bureau of Economic Analysis, US Department of Commerce, 2004 (Employer Cost Data) Bureau of Labor and Statistics, US Department of Labor, 2004 Confidential and Proprietary © 2004 Sg2

2003

Patient Cost-Sharing Will Reduce Non-Emergent Care Volume Relative Share of Premium Cost: Employers vs. Workers, 2000 and 2003 Employer Contribution Worker Contribution

$2,137

2000

$334

Single

Average Annual Deductibles for Single PPO Coverage: 2000 - 2003

$2,875

2003

$508

2000

$4,819

$1,619

Family

$6,656

2003

$2,000

$4,000

$2,412

$6,000

$8,000 $10,000

Source: KFF/HRET Employer Health Benefits Confidential and Proprietary ÂŠ 2004 Sg2

2003

$275

2002

$251

2001

$201

2000

$175

+57%

ED Volume Will Increaseâ&#x20AC;&#x201C;Urgent Care More Than Emergent Visits (Thousands)

Forecast of Emergency Department Visits Emergent vs. Urgent* ** US Market, 2002-2012

2002-2012 Total Growth

140000 120000

Overall

13%

Urgent

15%

100000 80000 60000

Actual

Forecast

40000 20000

Emergent

0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 * Visits with unknown or no triage status are proportionally distributed to urgent and emergent volumes ** Emergent visit is defined as a visit in which the patient should be seen in less than 15 minutes. Urgent volume includes all other ED visits Sources: CDC NHAMCS: 2000-2002 data; IoC Analysis, 2004 Confidential and Proprietary ÂŠ 2004 Sg2

Demographic Growth the Largest Driver of Volume Components Attributed to Emergency Department Volume Percent Changes Emergent vs. Urgent* US Market, 2002-2012 (Cumulative Changes)

Emergent Cases

Urgent Cases 0.4% 8.6%

0.1%

-3.4% -0.8%

1.2% -4.9% 11.8%

15.3%

-0.4%

10.5%

7.7%

Consumerism Payment Total and Economic Percent Change Sociocultural Technology

Demographics

Consumerism Payment Total Percent and Economic Change Sociocultural Technology

* Emergent visit is defined as a visit in which the patient should be seen in less than 15 minutes. Urgent volume includes all other ED visits Sources: CDC NHAMCS: 2000-2002 data; IoC Analysis, 2004 Confidential and Proprietary ÂŠ 2004 Sg2

Key Trends Will Impact Each Patient Type Differently Emergency Department Volume Distribution by Type of Patients US Market, 2002 (Percent) 100% = 110.2 million visits Statins for atherosclerosis Noninvasive coronary angiography (CTA) Implantable cardioverterdefibrillators (ICDs)

Acute Medical Insults 10%

Chronic Conditions 15% Anti-inflammatory agents for COPD (next generation) Anti-IgE monoclonal antibodies for chronic asthma Disease management Trauma and Accidents 34%

Polysaccharide vaccines for Primary Care pneumococcal disease (Non-emergency) Increased cost sharing Increased uninsured 41% population due to high premiums Real time PCR Proton pump inhibitors Economic rebound Access to technology Increasing societal dependence on ED

Highest Impact Technologies or Factors for Each Patient Type

Pharmaceutical Advances Will Impact Emergency Care Forecasted Technology Impact On ED Visits By Select Technology Class US Market, 2002 - 2012 Cumulative Impact (Thousands)

200 Implantibles/Nanotechnology

0 -200

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Minimally Invasive Energy delivery (e.g., CRTs)

-400 -600

Protein-based

-800 -1000 -1200

Targeted drug therapies

-1400 -1600

Vaccines

-1800

Confidential and Proprietary ÂŠ 2004 Sg2

Agenda Sg2…Who We Are Future Demand on Emergency Care Technology Solutions to Emergency Care Challenges The Path to Change

ED Volumes Are Rising, But EDs are Declining–More Volume Per ED Number of Emergency Departments US Market, 1992-2001 A decline of 13%, due to hospitals closing their EDs

4,652

4,037

2002 28

Technology Changes Care Deliveries Molecular Medicine Redefining disease and treatments

Imaging Reducing the unknown

Implantables Keeping parts working longer

Minimally Invasive Surgery Reducing patient trauma and shifting locations of care

Entering the Era of Targets 1. Disease is in the cell 2. Precision in treatments 3. Decentralization of care

Confidential and Proprietary ÂŠ 2004 Sg2

New Care Delivery Models Will Emerge to Promote Efficiency Current ED Care Delivery

Serial Management

Future ED Care Delivery

Bedside/ Decentralized Care

Parallel Processing

Operational Innovations

Traditional Triage

Confidential and Proprietary ÂŠ 2004 Sg2

Medical IT

Anticipatory Processing

Technology Will Impact the ED in Multiple Ways

Advancements in Clinical Technology

Enterprisewide Operational Innovations

Confidential and Proprietary ÂŠ 2004 Sg2

ED-Specific Technology and Care Pattern Changes

Clinical Technologies will Change the ED Patient Mix and Reduce ED Utilization Mismatch

High Impact Technologies on ED Volume Advancements in Clinical Technology

Devices ICDs VADs Chronic disease management Medical therapies Statins Polysaccharide vaccines for pneumococcal disease

ICD Utilization Will Continue to Grow as Indications Expand-Expect More ED Visits ICD Innovations US Market, 1980-2000

ICD Utilization for Approved Indications

1980s

Number of patients with ICD implanted per year

2000

Cardiac surgeon

Electrophysiologist or surgeon

Device size

120-140 cm3

≤ 40 cm3 Pectoral incision

Implant site/Incision

Median sternotomy or lateral thoracotomy 2-4 hours

1 hour

Physician

Procedure time Mortality

120 100 80 60 40 20

2.5%

< 0.5%

3-5 days

1 day

Battery life

18 months

Up to 9 years

Annual ICD market

0-2,000 per year

80,000 per year

ALOS

(thousands)

0 Cardiac Arrest

High Risk Post-AMI

The positive impact of ICDs on ED volume is mitigated by the new generation of “smart” pacemakers and ICDs, which include home monitoring systems that transmit detailed cardiac information to the physician offices.

VT/VF Non- VT Tolerated tolerated

LVADs Will Improve Patient Survivability and Will Generate Additional ED Visits Surgical Technology Example: Left Ventricular Assist Devices (LVADs) REMATCH* Study Results: Serious Adverse Events and Death, Rates Per 100 Patient Days LVADs vs. Optimal Medical Management (OMM) Device Thrombosis Pump Inflow or Outflow Infection Driveline or Pocket Infection LVAD Periop Bleeding LVAD Related RHF Psychiatric Episode Hepatic Dysfunction Renal Failure Non-periop MI Syncope Arrhythmias:SVA with cardioversion Arrhythmias:VA with cardioversion Arrhythmias:Cardiac Arrest Thromboembolic Event Sepsis Localized Infection Bleeding Neurologic Dysfunction Death 0.2

0.1

LVADs LVAS OMM OMM

0.1

0.2

rate per per 100 days Rate 100patient Patient Days * Randomized Evaluation of Mechanical Assistance for Treatment of Congestive Heart Failure Source: NEJM, 2001; Dr. Eric Rose 35 Confidential and Proprietary ÂŠ 2004 Sg2

0.3

0.4

Disease Management Will Prevent Patient Readmission and ED Use Disease Management Example: Congestive Heart Failure Overview of CHF Tel-Assuranceâ&#x201E;˘ Process

Four-Year Validation of CHF Disease Management Program Sample Hospital, 2001 Hospitalizations Pre-

Patient phones with weight and symptom report Readjusts medications, counsels and educates, triages cases

1. 2. 3.

Computer collects daily touch-tone answers Algorithms trigger exception reports Patients who have not called receive automated outbound reminder

800

Weight gain/loss or symptomatic

700 600

-46%

500 400 300 200

Reviews adherence to medications and diet

Post-Disease Management

CHF nurse assesses patient via telephone

-50%

100 0

CHF All Hospitalizations Hospitalizations Source: UCLA Medical Center, 2002; Journal of the American Geriatric Society, 1990 Confidential and Proprietary ÂŠ 2004 Sg2

Statins Will Reduce Chest Pain Presentations to ED Prescriptions (thousands)

Statin Prescription Growth US Market, 1999-2003

Future statin prescription growth will continue due to:

1999-2003 Total Growth 60%

3,000

Personalized medicine and pharmacogenomics

2,500

Combined therapy with advanced cholesterol treatment, including synthetic HDL infusions and cholesterol vaccines

2,000

1,500 1999

2000

Over 3 million people present to the ED with chest pain

2001

2002

2003

Impact Statins have been shown to reduce the incidence of coronary events by 35%, causing a significant impact on reducing ED visits Issues Poor statin adherence among patients treated for primary and secondary prevention of CHD due to copayment costs

Sources: CDC NHAMCS: 2002 data; JP Morgan Prescription Pad, 2003; Journal Gen Intern Med 2004; Sg2 Analysis, 2004 Confidential and Proprietary ÂŠ 2004 Sg2

Pneumococcal Vaccines Will Reduce ED Visits Heptavalent pneumococcal conjugate vaccine (PCV-7) has been in widespread use since FDA approval in 2000. More than 2.6 million patients presented to ED with otitis media and eustachian tube disorders in 2002 PCV-7 has been shown to be immunogenic for children under 2 years old. This age group was not protected by the traditional 23-valent vaccines Herd immunity, decline in pneumococcal disease in older children and adults, has also been observed Overall efficacy of all pneumococcal vaccines in preventing invasive disease is approximately 60%. ED visits of these patients will continue to decline

* Prior to vaccine approval (4/95 – 3/00) and after approval (4/00 – 3/02) Sources: CDC NHAMCS: 2002 Emergency Department Summary, March 2004; Pediatric News and Family Practice News, 2003; Sg2 Analysis, 2004 Confidential and Proprietary © 2004 Sg2

Operational Innovations Will Reduce Medical Errors and Wait Time at the ED

High Impact Technologies on ED Efficiency Web-based health services Electronic medical record (EMR) Clinical decision support systems (CDSS) Enterprise-wide Operational Innovations

Hospitalist and intensivist models Remote ICU monitoring

Web-based Health Services Will Improve Access to Primary Care

Confidential and Proprietary ÂŠ 2004 Sg2

Adoption of EMR Will Reduce Medical Errors Hospitals are adopting EMR. About 19% of health care providers have implemented a fully operational EMR system. An additional 37% are currently in the process of implementing. Impact of EMR in Emergency Care Settings Paperless ED with EMR for triage, patient tracking, registration, order entry, nursing and physician documentation, discharge instructions and prescription writing Reduction in medical errors with immediate access to patient records National computerized information systems, as reported by IOM, required to significantly reduce medical errors and acceleration of EMR adoption/ implementation Sources: HIMSS, 2004; IOM, 2003; Sg2 Analysis, 2004 Confidential and Proprietary © 2004 Sg2

Clinical Decision Support System Will Expedite and Promote Appropriate Care

Scientific Evidence

Clinician Experience

Point of care “on demand” “just in time” information for decision making

Ethics and Values

Information Technologies

Impact of Evidence-Based Clinical Decision Support System in Emergency Care Settings Improved accuracy in clinical decision making with customized diagnosis and treatment based on evidence-based guidelines and up-to-date protocols Increased staff productivity with operational efficiency through real-time, patient-specific decision support Faster patient throughput

Intensivist and Hospitalist Models Will Streamline Hospital Efficiency Intensivists

Hospitalists

Serve as the gatekeepers of the ICUs

Reduce admission times for medical patients admitted from the ED through a hospitalist triage and admission intervention system implemented by Johns Hopkins Bayview Medical Center

Reduce hospital and ICU mortality Improve hospital efficiency by reducing inappropriate ICU admissions and length of stay (hospital and ICU)

Reduce ED patient wait time and ED bottlenecks

The University of Pittsburgh offers a combined Internal Medicine/Emergency Medicine/Critical Care Medicine Training Program, preparing both intensivists and hospitalists to care for the critically ill and patient emergencies.

Are in demand as hospitals are required to adopt full-time intensivist model to meet the Leapfrog ICU Physician Staffing standard. Only 10% of ICUs in the US meet this standard.

Remote Monitoring Will Improve ICU Throughput, Reduce ED Wait Time

Advocate HealthCare intensivist monitors 50 patients using eICU®.

Impact on Emergency Department Estimated Impact of eICU®* Hospital

ICU

Mortality Rate

26.4% È

26.7% È

Average LOS

N/C

16.0% È

Outliers

16.8% È

N/C

Variable costs/case

24.6% È

N/C

ED patient wait time and ED bottleneck reduction

Next-generation technology applicable to ED

Improved operational efficiency, especially during infectious disease outbreak

Technologies Will Enable Changes Within the Emergency Department

High Impact Technologies and Operational Innovations on ED Efficiency Regionalization of care Advanced imaging modalities CT angiography ED-Specific Technology and Care Pattern Changes

Rapid diagnostics EMS technologies ED information systems Patient registration and tracking technologies Lab automation Effective triage models

Transforming ED from All Things to All People to Specialization – Regionalization of Care Mortality Rates in Clinical Trials* Comparing Onsite Fibrinolysis vs. Transfer for PCI For STEMI (Percent)

Primary PCI

Onsite Fibrinolysis

14.0 12.1 10.0 7.0

7.0

6.6

7.6

8.4

Impact Primary Percutaneous Coronary Intervention (PCI) has been proven to be more effective to treat ST-Segment Elevation Myocardial Infarction (STEMI). Patient transfer strategies similar to regional trauma networks are needed.

6.8

Successful Networks Need

5.0

Centralized AMI facilities within reasonable distances Integrated EMS LIMI (1999) N=224

PRAGUE (2000) N=300

DANAMI (2002) N=1572

AIR-PAMI (2002) N=138

PRAGUE-2 (2002) N=850

Experience in medical community with centralized AMI care networks

* LIMI=Limburg Intervention/MI trial; PRAGUE=Primary Angioplasty After Transport of Patients From General Community Hospitals to Cath Units With/Without Emergency Thrombolysis Infusion Trials; DANAMI=Danish Multicenter Randomized Trial on Thrombolytic Therapy Versus Acute Coronary Angioplasty in AMI trial; AIR-PAMI=Air Primary Angioplasty in Myocardial Infarction Trial Source: Journal of the American College of Cardiology, 2004 Confidential and Proprietary © 2004 Sg2

Advanced Imaging Modalities Strategically Located at the ED Will Accelerate Diagnosis

16- or Higher-slice CT System Handheld Ultrasound

Digital Radiography System (Kodak Directview DR9000 at the trauma center of St. John Medical Center, Tulsa, Oklahoma) Confidential and Proprietary ÂŠ 2004 Sg2

CT Angiography Will Reduce Diagnostic Time for Chest Pain Choice of work-up depends on the clinical question: Case A: assessment of functional impact of symptoms => stress test Case B: CAD likely & desire “road map” for intervention => angio or CTA Case C: rapid exclusion of coronary obstructions => CTA

Former smoker

EKG Stress Test X-ray angiography

EKG X-ray angiography CTA

EKG CTA

Rapid Diagnostics Will Reduce Both Medical Errors and Wait Time Rapid Diagnostics Example: Real-time PCR Bacterial and Viral Genome Sequencing Projects

Next Generation Real-Time PCR

Extraction, Amplification and Detection < 25 minutes Sources: JAMA, August 2000; B. Rogers Presentation, AMP 2002; Cephid Corporate Documents 49 Confidential and Proprietary ÂŠ 2004 Sg2

In the ED setting, emerging real-time PCR tests for conditions such as pneumococcus, meningitis, bloody diarrhea and septicemia will replace laboratory evaluations for occult bacteremia and due to rapid, accurate test results, may sharply decrease the use of antibiotics. Early targeted disease detection will speed recovery.

Real-Time PCR Expedites Diagnosis and Improves Accuracy of Clinical Decision Making Impact on:

30 Cycles

Service Lines Infectious disease; hospital infection control Cancer

1 Original Target

Finances Total costs for real-time PCR platforms and automated DNA extractors ~$100,000 to $400,000 Marginal reimbursement (at best) CPT codes not keeping pace

1 Billion PCR Products

Game-changing feature: improved speed

Operations

Technology Improvements

Reduces test turnaround time Decentralized into rapid-response labs, as the technology becomes faster and easier

Traditional PCR—3 steps Real Time PCR—2 steps Next generation real-time PCR—1 step

Technology Implementation in EMS Will Save Time and Improve Patient Outcomes

Santa Cruz County, CA Tele-electrocardiography

Electronic Patient Care Reporting Systems

UCSF-designed study, being tested in Santa Cruz County

Paramedics to enter patient information to Tablet PCs and transmit the data to ED via wireless connection

New “tele-electrocardiography” system takes reading every 30 seconds

Improve care delivery by allowing the hospitals to anticipate the patient arrival

Data transmit to ED via cell phone Study to determine if the system will improve survival and long-term health of heart attack victims Sources: UCSF, 2003; iHealthBeat.org, 2004; LifeNet EMS web site, 2004 Confidential and Proprietary © 2004 Sg2

ED Information System Will Streamline the Care Process

High Risk alert Length of stay (LOS) Nursing timers Order status for labs, X-rays, EKGs Patient acuity Patient bed/location

Patient Registration and Tracking Technologies Will Improve ED Patient Flow Patient registration using self registration kiosks and handheld portable computers

Patient tracking using infrared and radio frequency technologies

Legoland in Denmark uses RFID to let parents track their children. Confidential and Proprietary ÂŠ 2004 Sg2

Lab Automation Can Break the ED Bottlenecks Draw & Hold at Northwestern

Patients enter ED Standing orders guide test selection Tests sent to automated lab Results ready for physician Add-on tests in 6 minutes

Overall ED Project Improvement Improved throughput and room

utilization by 20% Reduced patient wait time 40% Raised Press-Ganey scores to 80th % goal

Effective Patient Triage Models Will Shorten Patient Turnaround Time Streamlined ED Triage Example: Asthma Patient Management Current ED paradigm: slow turnaround

Strategies for improving the ED paradigm Improved ED Workflow Model Triage at Presentation Transfer patients with asthma directly to the pulmonary observation unit

ED Management Pulmonary Observation Unit

Chest x-ray

SLOW

ICU Admission

Oxygen therapy PEF or FEV1 Inhaled β2 agonist

Secondary Triage

Corticosteroids Labs +/- blood gas

Standard Admission

Discharge

ICU Admission

Standard Admission

Medicare currently reimburses hospitals for observation care provided to patients with asthma, chest pain and CHF. Future expansion to other diagnoses is forecasted. Source: Sg2 Analysis Confidential and Proprietary © 2004 Sg2

Discharge

FAST AND EFFICIENT

Impending Respiratory Failure

FAST

Initial Assessment Objective assessment of airflow History and physical examination

Agenda Sg2…Who We Are Future Demand on Emergency Care Technology Solutions to Emergency Care Challenges The Path to Change

System of the Future Provides the Right Care to the Right Patient in the Right Setting High

Acuity

Comprehensive Disease Care Centers

Acute Custom Care Facility

Physicians

Birthing Centers ASCs

Primary Care Centers

Low Focused High-Volume Routinized

Broad, Customized

Clinical Focus Confidential and Proprietary ÂŠ 2004 Sg2

Lower Costs Can Be Achieved Through Clinical and Operational Excellence

Clinical Process

Strong

M od el ne ss Strong

Weak

Business Process

Confidential and Proprietary ÂŠ 2004 Sg2

Bu si

Weak

30% Savings

Hospital’s Technology Adoption is the Foundation for Planning 5

Clinical Change

Operational Change 3

Financial Change 2 1

Developers, strong in research Early-stage initiatives cited at national meetings/journals

Possesses, but doesn’t develop the latest technologies Reports on the first widespread use

Innovators

Early Adopters

Focuses on technologies broadly available Organizational incentives reinforce consistency in approach/process

Consensus Adopters

Lags in adoption of mature technologies Capitalconstrained or has limited staff

Cautious Adopters

Outdated technology and systems Lacks focus, with few decisions related to strategy/future development

Late Adopters

Impact of Technology on Emergency Department Impact on Technology

Technology Adoption*

STAR**

ED Utilization

Delays in Treatment

Medical Errors

Rapid diagnostics

Advanced imaging modalities

Clinical decision support systems (CDSS)

Electronic medical record (EMR)

CT angiography

Lab automation

1-2

Regionalization of care

Remote monitoring

EMS technologies

1-3

ED information systems

Effective triage models

Hospitalist and intensivist models

* Technology adoption categories with current national adoption rate ** Sg2 Technology Advantage Rating (STAR) assigns 1 star (lowest impact) to 5 stars (highest impact) to each technology or operational innovation according to its impact on ED clinical outcomes, operational efficiency and financial performance for the next eight years (2004 – 2012). Source: Sg2 Analysis, 2004 Confidential and Proprietary © 2004 Sg2

Impact of Technology on Emergency Department (Continued) Impact on Technology

Technology Adoption*

STAR**

ED Utilization

Patient registration and tracking technologies

Web-based health services

Pneumococcal vaccines

VADs

Chronic disease management

ICDs

Statins

Delays in Treatment

Medical Errors

The Path to Change Requires Technology Investments and Planning Sg2 Technology Evaluation & Planning (STEPďŁŞ) Program Technology Assessment Where are we?

Technology Adoption

Where do we need to be?

How do we get there?

Profile

Plan

Market Position

Industry Outlook

Acquisition & Introduction

Competitive Landscape

Technology Evaluation

Diffusion

Technology Profile

Technology Priorities

Monitoring

Confidential and Proprietary ÂŠ 2004 Sg2

Manage

The Bottom Line… ED is a reflection of the community. Technology changes outside the ED are more powerful in changing ED work flow than technology in the ED. ED is only as good as the weakest part of the hospital.

Accelerate Technology Adoption – Improve Care

Confidential and Proprietary ÂŠ 2004 Sg2