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Change, Challenges, and Innovation in Health Care Delivery

Change, Challenges, and Innovation in Health Care Delivery

Since the 1970s the U.S. health care system has experienced rapid and unprecedented change. The sites where health care is delivered have shifted from acute inpatient hospitals to outpatient settings, such as ambulatory care and surgical centers, clinics, and physicians' offices, and long-term care and rehabilitation facilities. Patterns of disease have changed from acute infectious diseases that require episodic care to chronic conditions that require ongoing care. Even threats to U.S. public health have changed—epidemics of infectious diseases have largely been replaced by epidemics of health risks such as obesity, diabetes, mental illness, substance abuse, and physical inactivity. At the end of 2001 the threat of bioterrorism became an urgent concern of health care planners, providers, policy makers, and the American public, and in 2006 the nation prepared for the possibility of pandemic influenza.

There are new health care providers—midlevel practitioners (advance practice nurses, certified nurse midwives, physician assistants, and medical technologists)—and new equipment for diagnosis such as magnetic resonance imaging (MRI) and genetic testing. Furthermore, the rise of managed care, the explosion of biotechnology, and the availability of information on the Internet have dramatically changed how health care is delivered.

Some health care industry observers suggest that the speed at which these changes have occurred has further harmed an already complicated and uncoordinated health care system. There is concern that the present health care system cannot keep pace with scientific and technological advances. Many worry that the health care system is already unable to deliver quality care to all Americans and that it is so disorganized that it will be unable to meet the needs of the growing population of older Americans or to respond to the threat of a pandemic or bioterrorism.

This chapter considers several of the most pressing challenges and opportunities faced by the U.S. health care system. These include:

  • Safety: Ensuring safety by protecting patients from harm or injury inflicted by the health care system—preventing medical errors, reducing hospital-acquired infections, and safeguarding consumers from medical fraud. Besides actions to reduce problems caused by the health care system, safety and quality may be ensured by providers' use of clinical practice guidelines—standardized plans for diagnosis and treatment of disease and the effective application of technology to information and communication systems.
  • Information management: Information technology, including the Internet, can provide health care providers and consumers with timely access to medical data, patient information, and the clinical expertise of specialists. For example, Gerard F. Anderson et al., in "Health Care Spending and Use of Information Technology in OECD Countries" (Health Affairs, May-June 2006), discuss that effective deployment of information technology can also reduce health care expenditures. Reliable public sources of consumer and provider health information on the Internet include the National Institutes of Health, Centers for Disease Control and Prevention (CDC), and MEDLINE. Using this technology effectively is a health system challenge, especially in terms of protecting patient privacy and confidentiality and ensuring that consumers have access to accurate and reliable health information.
  • Innovation: Widespread use of innovations in health care delivery should be recommended only after objective analysis has demonstrated that the innovation will measurably benefit the safety, effectiveness, efficiency, or timeliness of health service delivery. Innovations should also be considered if they have the potential to reduce waste of equipment, supplies, or personnel time or if they have the capacity to allocate or distribute health care more equitably. Equitable distribution refers to access to care that does not vary in quality based on the characteristics, such as race, gender, ethnicity, or socioeconomic status, of the population served.


Although the United States is generally viewed as providing quality health care services to its citizens, a 1999 landmark report issued by the Institute of Medicine (IOM), To Err Is Human: Building a Safer Health System (, estimated that as many as ninety-eight thousand American deaths per year are the result of preventable medical errors. More than seven thousand of these deaths are estimated to be because of preventable medication errors.

The IOM calculated the cost of medical errors, in terms of lost income, disability, and health care costs, at about $29 billion per year. Other costs, such as pain, loss of loved ones, and human suffering, are incalculable. However, they are important because unlike errors in other industries, medical errors often do more than merely inconvenience consumers—they may cause disability and death. According to the CDC, adverse events (bad outcomes) affecting medical care occur in about 3-4% of all patients. The IOM report found that most medical errors occurred as a result of system problems rather than as mistakes made by individual health care providers.

In 2006 HealthGrades, Inc., an independent health care quality research organization that grades hospitals based on a range of criteria and provides hospital ratings to health plans and other payers, issued its third update to the 1999 IOM report. The report, Third Annual Patient Safety in American Hospitals Report (April 2006,, finds that despite widespread participation in patient safety initiatives to reduce the frequency of medical errors, progress to improve safety has been slow during the six years since the IOM report was issued.

The HealthGrades hospital patient safety study looked at nearly forty million Medicare patient records to assess the mortality and economic impact of medical errors and injuries that occurred during hospital admissions nationwide from 2002 through 2004. The study finds that 250,246 people in the United States died as a result of potentially preventable, in-hospital medical errors during the study period, and the incidence of patient safety problems had increased from 1.14 million and 1.18 million in the previous reports to 1.24 million.

Some of the most significant patient safety findings are:

  • Minnesota is the best state in terms of patient safety, and Wisconsin, Iowa, Michigan, and Kansas are among the top five. New Jersey has the poorest patient safety scores and New York, Nevada, Tennessee, and the District of Columbia also performed poorly.
  • One in every four Medicare patients hospitalized from 2002 through 2004 who experienced a patient-safety incident died. This rate has remained constant since the first HealthGrades study, which was released in July 2003.
  • The selected patient-safety incidents accounted for $9.3 billion in excess inpatient costs to the Medicare system during the study period.
  • Patient-safety incidents with the highest rates per one thousand hospitalizations were failure to rescue (this indicator identifies patients who die following the development of a complication and assumes that quality hospitals identify these complications promptly and treat them aggressively), decubitus ulcer (bedsores), and postoperative sepsis (infection following surgical procedures), which accounted for nearly 63% of all documented patient-safety incidents.
  • Compared with the 2003 research results, the rates of six key quality improvement focus areas—metabolic derangements, postoperative respiratory failure, decubitus ulcer, postoperative pulmonary embolus or deep vein thrombosis, and hospital-acquired infections—not only were unimproved but also worsened by at least 12% from 2002 through 2004.
  • If all hospitals performed as well as those distinguished for patient safety, 280,134 safety incidents and 44,153 deaths of Medicare patients could have been prevented, resulting in cost savings of $2.4 billion from 2002 through 2004.

Strengthening Safety Measures

In response to a request from the U.S. Department of Health and Human Services (HHS), the Committee on Data Standards for Patient Safety of the IOM created a detailed plan to develop standards for the collection, coding, and classification of patient safety information. The 550-page plan, Patient Safety: Achieving a New Standard for Care (2004), called on the HHS to assume the lead in establishing a national health information infrastructure that would provide immediate access to complete patient information and decision support tools, such as clinical practice guidelines, and capture patient safety data for use in designing ever-improving and safer health care delivery systems.

The IOM plan exhorted all health care settings to develop and implement comprehensive patient safety programs and recommended that the federal government launch patient safety research initiatives aimed at increasing knowledge, developing tools, and disseminating results to maximize the effectiveness of patient safety systems. The plan also advised the designation of a standardized format and terminology for identifying and reporting data related to medical errors.

Who Is Responsible for Patient Safety?

Many federal, state, and private-sector organizations work together to reduce medical errors and improve patient safety. The CDC and the U.S. Food and Drug Administration (FDA) are the leading federal agencies that conduct surveillance and collect information about adverse events resulting from treatment or the use of medical devices, drugs, or other products. The CDC (February 2006, directs the National Nosocomial Infections Surveillance system to track the hospital- and health care-acquired infections estimated to affect about two million patients and claim ninety thousand lives per year. (Nosocomial infections are defined as infections that are not present or incubating at the time of admission to the hospital and as such are considered hospital acquired.)

The sixth-leading cause of death in the United States, hospital-acquired infections are estimated by the CDC to have added nearly $4.5 billion annually to direct patient care costs. The CDC collaborates with state and local health departments, private-sector groups, academic medical centers, and health care providers to develop and implement other programs to reduce errors and adverse outcomes of care.

The Centers for Medicare and Medicaid Services acts to reduce medical errors for the approximately seventy-five million Medicare, Medicaid, and State Children's Health Insurance Program beneficiaries through its peer review organizations. Peer review organizations concentrate on preventing delays in diagnosis and treatment that have adverse effects on health.

The Department of Defense and the Department of Veterans Affairs (VA), which is responsible for health care services for U.S. military personnel, their families, and veterans, have instituted computerized systems that have demonstrably reduced medical errors. The VA established Centers of Inquiry for Patient Safety, and its hospitals also use bar-code technology and computerized medical records to prevent medical errors.

Safe medical care is also a top priority of the states and the private sector. The HealthGrades report finds that twenty-five states had mandatory reporting of medical errors as of September 2005. In 2000 some of the nation's largest corporations, including General Motors and General Electric, joined together to address health care safety and efficacy and to help direct their workers to health care providers—hospitals and physicians—with the best performance records. Called the Leapfrog Group, this business coalition was founded by the Business Roundtable, a national association of Fortune 500 chief executive officers, to leverage employer purchasing power that initiates innovation and improves the safety of health care.

The Leapfrog Group publishes hospital quality and safety data to assist consumers in making informed hospital choices. Hospitals provide information to the Leapfrog Group through a voluntary survey that requests information about hospital performance across four quality and safety practices with the potential to reduce preventable medical mistakes and improve health care quality. In 2006 the Leapfrog Group was composed of more than sixty Fortune 500 companies and other large private and public-sector purchasers of health care benefits. Its mission is to promote health care safety programs and advocate innovative solutions to existing problems, such as equipping physicians with handheld devices to record patient information and perform electronic prescribing.


According to the report Trends and Indicators in the Changing Health Care Marketplace (May 2002,, the Henry J. Kaiser Family Foundation notes that nearly all physicians (95%) and the overwhelming majority of nurses (89%) and health care executives (82%) of those surveyed report having seen serious medical errors. Furthermore, in "Medical Errors Survey" (Kaiser Health Poll Report, July-August 2003), the foundation finds that more than one-third of physicians say they had been in a situation where a preventable error was made in their own care or that of a family member.

Professional societies also are concerned with patient safety. More than 50% of all Joint Commission on Accreditation of Healthcare Organizations (JCAHO) hospital standards pertain to patient safety. As of July 1, 2002, hospitals seeking accreditation from the JCAHO were required to adhere to stringent patient safety standards to prevent medical errors. The JCAHO standards also require hospitals and individual health care providers to inform patients when they have been harmed in the course of treatment. The aim of these standards is to prevent medical errors by identifying actions and systems likely to produce problems before they occur. An example of this type of preventive measure, which is called prospective review, is close scrutiny of hospital pharmacies to be certain that ordering, preparation, and dispensing of medications is accurate. Similar standards have been developed for JCAHO-accredited nursing homes, outpatient clinics, laboratories, and managed care organizations.

On January 1, 2004, the JCAHO began surveying and evaluating health care organizations using new medication management standards. The new standards revise and consolidate existing standards and place even greater emphasis on medication safety. The revised standards increase the role of pharmacists in managing appropriate and safe medication use and strengthen their authority to implement organization-wide improvements in medication safety.

Chief among the safety measures that concern professional societies are programs to prevent and report medication errors. The Agency for Healthcare Research and Quality estimates in the fact sheet Medical Errors: The Scope of the Problem (February 2000, that about half of all medication errors are preventable. It suggests that when a medication error occurs, it is not the result of a single mistake, but a series of breakdowns in the health care delivery system. Research also supports the idea that the underreporting of medication errors stems from practitioners' concern that individuals will be punished rather than health system failures corrected. Charles D. Hepler and Richard Segal state in Preventing Medication Errors and Improving Drug Therapy Outcomes (2003) that many professional societies, such as the Oncology Nursing Society, take the position that confidential voluntary reporting of medical errors will increase the frequency with which errors are reported and fully described and thereby will better identify health system deficiencies that lead to errors.


In "The Working Hours of Hospital Staff Nurses and Patient Safety" (Health Affairs, July 2004), Ann Rogers et al. note that that the chance of a hospital nurse making a mistake is three times higher once a shift exceeds 12.5 hours. In Rogers et al.'s study of 393 hospital nurses, about 40% of the nurses' shifts exceeded 12.5 hours over a four-week period. The risks of making an error were significantly increased when work shifts were longer than twelve hours, when nurses worked overtime, or when they worked more than forty hours per week.

During the 5,317 shifts Rogers et al. scrutinized, there were 199 medical errors. Most were medication errors such as administering the wrong drug or the wrong dose, or delays—giving medication later than scheduled. The IOM, along with professional associations and patient advocacy groups, recommends limiting nurses' workdays to twelve hours.


Although the Third Annual Patient Safety in American Hospitals Report finds that just 74% of hospitals surveyed had fully implemented a patient safety plan and 9% had no plan at all, some hospitals are taking extraordinary measures to reduce medical errors and enhance safety. As Gautam Naik reports in "Ounce of Prevention to Reduce Errors, Hospitals Prescribe Innovative Designs" (Wall Street Journal Online, May 8, 2006), novel approaches include hotlines to enable staff to anonymously report medical errors and architectural innovations such as slip-proof floors, special lighting to aid diagnosis, round rather than sharp interior wall corners, and standardized layout of equipment enabling staff to quickly and easily access needed equipment and supplies. Some hospitals have chosen to abandon the practice of recycling the air in the buildings to reduce the risk of spreading infections. Others have chosen to forgo vinyl coverings on external walls because it attracts infection-causing mold. At least one hospital that instituted facility-wide design and layout changes reports preliminary evidence that the changes it instituted have already reduced rates of infection, falls, and medication errors.

Legislation to Improve Safety

The Patient Safety and Quality Improvement Act was signed into law on July 29, 2005. The act promotes the reporting, analysis, and prevention of medical errors by giving legal protection to health care providers who report patient safety data. It protects this confidential information from being subpoenaed, disclosed under the Freedom of Information Act, or admitted as evidence in civil, criminal, or administrative proceedings. It also ensures that information reported may not be used to enforce personnel actions such as denying practitioners certain privileges (such as the ability to admit patients to the hospital) or credentials, such as licensure or recertification. Unlawful disclosure of patient safety data would be punishable by fines as high as $10,000 per violation.

The act does not change existing remedies available to injured patients or limit patient access to medical records. It does stipulate that medical errors will be reported to "patient safety organizations," which may voluntarily submit the data they obtain to a national, nonidentifiable patient safety database linked to the Agency for Healthcare Research and Quality. "Patient safety data" refers to all reports, statements, and quality improvement information that are collected, developed, or reported by providers to patient safety organizations.


According to the FDA and the Federal Trade Commission (FTC)—the lead agencies charged with protecting health care consumers from fraud—common health fraud targets are people who are battling serious diseases (conditions with no known cure) and people who are overweight. People who feel frightened or hopeless or those suffering from chronic pain may be especially vulnerable. Officials at these federal agencies cite people with diagnoses of cancer, diabetes, multiple sclerosis, Alzheimer's disease, HIV/AIDS, and arthritis as examples of consumers who may become victims of fraudulently marketed, frequently useless health care products, devices, and treatments.

Unproven and fraudulently marketed "miracle cures" are nearly always entirely ineffective, although most are harmless. They are dangerous, however, when consumers use them instead of seeking more effective, conventional medical care and treatment. Most victims of health fraud simply lose time and money but some lose their health, either by delaying needed treatment or by using a product or device that is harmful to their health.

The FTC and FDA urge consumers to exercise caution when purchasing medical or health care devices, products, and treatment. They encourage consumers to view claims of immediate cures or relief of chronic health problems with appropriate skepticism. Basically, the adage "if it sounds too good to be true, it probably is" holds true when evaluating the claims of health care products or services. Examples of such unbelievable and misleading claims are those for dietary supplements that promise "eat all you like and still lose weight" or devices promising "instant relief from arthritis pain."

The Internet provides a new arena for unscrupulous purveyors of prescription drugs as well as marketers of unproven health care products and services. It is often difficult for consumers to distinguish between legitimate Web sites that offer pharmaceutical drugs and irresponsible, unsafe sellers of prescription drugs. The FDA warns consumers that Web site purchases are risky because drugs may be counterfeit, doses may be incorrect, or the wrong drug may be delivered. The FDA also advises against filling prescriptions through a Web site that allows consumers to order prescription drugs after simply completing a health questionnaire. Both the FDA and American Medical Association (AMA) consider a completed health questionnaire as an insufficient, and potentially dangerous, basis for prescribing drugs. Additional FDA warnings contained in the publication Buying Prescription Medicine Online: A Consumer Safety Guide (March 2005, include:

  • Consumers should not purchase prescription drugs for the first time from sites that sell drugs without a prescription or a physical examination, or sites that sell drugs that are not FDA approved.
  • It is unwise to purchase drugs from sites that do not have a registered pharmacist available to respond to questions.
  • It is not advisable to order from sites that do not offer a U.S. address and phone number to contact in the event of problems with the drug, product, or device purchased.
  • Purchases from foreign Web sites are especially risky because the U.S government cannot take any action if consumers are victims of fraud or receive otherwise unsatisfactory service.


Clinical practice guidelines (CPGs) are evidence-based protocols—documents that advise health care providers about how to diagnose and treat specific medical conditions and diseases. CPGs offer physicians, nurses, other health care practitioners, health plans, and institutions objective, detailed, and condition- or disease-specific action plans.

Widespread dissemination and use of CPGs began during the 1990s in an effort to improve the quality of health care delivery by giving health care professionals access to current scientific information on which to base clinical decisions. The use of guidelines also aimed to enhance quality by standardizing care and treatment throughout a health care delivery system such as a managed care plan or hospital and throughout the nation.

Early attempts to encourage physicians and other health professionals to use practice guidelines was met with resistance, because many physicians rejected CPGs as formulaic "cookbook medicine" and believed that they interfered with physician-patient relationships. Over time, however, physicians were educated about the quality problems resulting from variations in medical practice, and opinions about CPGs gradually changed. Physician willingness to use CPGs also increased when they learned that adherence to CPGs offered some protection from medical malpractice and other liability. Nurses and other health professionals more readily adopted CPGs, presumably because their training and practice was oriented more toward following instructions than physicians' practices had been.

The National Guideline Clearinghouse is a database of CPGs produced by the Agency for Healthcare Research and Quality in conjunction with the AMA and the American Association of Health Plans. The clearinghouse offers guideline summaries and comparisons of guidelines covering the same disease or condition prepared by different sources and serves as a resource for the exchange of guidelines between practitioners and health care organizations.

CPGs vary depending on their source. All recovery and treatment plans, however, are intended to generate the most favorable health outcomes. Federal agencies such as the U.S. Public Health Service and the CDC, as well as professional societies, managed care plans, hospitals, academic medical centers, and health care consulting firms, have produced their own versions of CPGs.

Practically all guidelines assume that treatment and healing will occur without complications. Because CPGs represent an optimistic approach to treatment, they are not used as the sole resource for development or evaluation of treatment plans for specific patients. CPGs are intended for use in conjunction with evaluation by qualified health professionals able to determine the applicability of a specific CPG to the specific circumstances involved. Modification of the CPGs is often required and advisable to meet specific, organizational objectives of health care providers and payers.

It is unrealistic to expect that all patients will obtain ideal health outcomes as a result of health care providers' use of CPGs. Guidelines may have greater utility as quality indicators. Evaluating health care delivery against CPGs enables providers, payers, and policy makers to identify and evaluate care that deviates from CPGs as part of a concerted program of continuous improvement of health care quality.


Robert Pear reports in "A.M.A. to Develop Measure of Quality of Medical Care" (New York Times, February 21, 2006) that in December 2005 the AMA resolved to develop approximately 140 performance measures covering thirty-four clinical areas by the end of 2006. The AMA agreement with Congress calls for physicians to voluntarily report their performance on these measures as part of a national quality improvement program in 2007. The measures will consider "best practices," the diagnostic tests and treatments that have demonstrated the ability to improve clinical outcomes—how patients fare as a result of treatment. The AMA agreed to spearhead the development of uniform measures of quality so that physicians do not have to attempt to adhere to a variety of measures imposed on them by insurance companies, health plans, and government programs. Instead, the AMA developed measures that will be the metric used to assess physician performance and compensation, specifically the fees paid to them by Medicare.

Pear notes that although the AMA initiative received strong support in Congress and from the AARP, the lobbying group for older Americans, some physicians and medical specialty groups fear that the data they report may be used to justify reducing their fees. Medicare payment for physician services was frozen in 2006 and could be reduced more than 4.5% annually over the next eight years. In the past, Congress has intervened to prevent or delay reducing fees; however, it may require physicians to report measures of clinical performance as a prerequisite for receiving even a nominal increase in Medicare fees.


The explosion of communication and information management technologies has already revolutionized health care delivery and holds great promise for the future. Health care data can be easily and securely collected, shared, stored, and used to promote research and development over great geographic distances and across traditionally isolated industries. Online distance learning programs for health professionals and the widespread availability of reliable consumer health information on the Internet have increased understanding and awareness of the causes and treatment of illness. This section describes several recent applications of technology to the health care system.


The term telemedicine describes a variety of interactions that occur by way of telephone lines. Telemedicine may be as simple and commonplace as a conversation between a patient and a health professional in the same town or as sophisticated as surgery directed by way of satellite and video technology from one continent to another.

According to the Telemedicine Research Center, a nonprofit public research organization based in Portland, Oregon, there are two types of technology used in most telemedicine applications. The first type stores digital images taken with a digital camera and sends them from one location to another. The most common application of this kind of telemedicine is teleradiology—sending x-rays, computerized tomography scans, or MRIs from one facility to another. The same technology may be used to send slides or images from the pathology laboratory to another physician or laboratory for a second opinion. Another example of the use of digital image transfer is the rural primary care physician who, miles from the nearest dermatologist (physician specialist in skin diseases), can send a photograph of a patient's rash or lesion and receive an immediate, long-distance consultation from the dermatologist.

Another application of telemedicine that uses only the standard telephone line in a patient's home is transtelephonic pacemaker monitoring. (Cardiac pacemakers are battery-operated implanted devices that maintain normal heart rhythm.) Cardiac technicians at the other end of the telephone are able to check the implanted cardiac pacemaker's functions, including the status of its battery. Transtelephonic pacemaker monitoring is able to identify early signs of possible pacemaker failure and detect potential pacemaker system abnormalities, thereby reducing the number of emergency replacements. It can also send an electrocardiogram (ECG) rhythm strip to the patient's cardiologist.

The other type of technology described by the Telemedicine Research Center is two-way interactive television (IATV), which uses video-teleconferencing equipment to create a meeting between a patient and primary care physician in one location and a physician specialist elsewhere when a face-to-face consultation is not feasible because of time or distance. Peripheral equipment even enables the consulting physician specialist to perform a virtual physical examination and hear the patient's heart sounds through a stethoscope. The availability of desktop videoconferencing has expanded this form of telemedicine from a novelty found exclusively in urban, university teaching hospitals to a valuable tool for patients and physicians in rural areas who were previously underserved and unable to access specialists readily.

Despite the promise of telemedicine, several obstacles have prevented Americans from realizing all its potential benefits. As of July 2006 many states did not permit physicians who are not licensed in their states to practice telemedicine, and the Centers for Medicare and Medicaid Services reimburses for interactive teleconference services but will not pay for digital image transfer. Many private insurers have been reluctant to pay for telemedicine, and some physicians fear additional liability (medical malpractice suits or other litigation) arising from telemedicine. Finally, some of the communities that would benefit most from telemedicine do not have the telecommunications equipment necessary to deliver the bandwidth for telemedicine.

In "A Plug-in a Day Helps Keep Sickness at Bay" (Washington Post, April 18, 2006), Elena Cherney observes that although telemedicine has been available for a decade, its use is increasing as more private insurers agree to cover the technology and as makers of equipment and devices develop increasingly efficient methods of delivering care. Many of these new techniques capitalize on the availability of high-speed Internet connections. Examples include devices to monitor vital signs and blood glucose and bathroom scales that plug into phone jacks, allowing nurses to monitor heart patients for fluid retention when they return home from the hospital. The high-tech monitors can cost as much as $150 per month per patient, but several studies find that they can prevent costly hospitalizations and, in some cases, help to improve patient outcomes.

Wireless Technology in the Hospital

In Hospitals Unplugged: The Wireless Revolution Reaches Healthcare (April 3, 2001,, Glenn W. Wachter describes a hospital where nurses enter patient data at wireless mobile workstations, pagers deliver patients' ECGs and vital signs, a wireless scanning device verifies the correct medication and dosage for a patient, and physicians access instantly updated medical records on their wireless personal digital assistants. Wachter asserts that mounting pressure to increase hospital and health service delivery efficiencies is driving interest and use of wireless technology; he also observes how its advocates maintain that along with saving money, wireless technology will also improve quality.

By improving communication of medical information, wireless technology can increase the accuracy of patient data, increase the efficiency of health care workers, deliver immediate access to medical and administrative information, and sharply reduce paperwork. Furthermore, by linking wireless technology to pharmacy management systems, it can reduce prescribing and dispensing errors. Wachter also observes the application of wireless technology in prehospital care. Ambulances equipped with wireless devices can transmit video, audio, ECGs, vital signs, and other images to the emergency department team awaiting arrival of the critically ill patient.

By 2004 many hospitals had adopted wireless technology. Linda Rosencrance reports in "Boston Hospital Will Track Assets with Wireless System" (Computer-world, September 20, 2004) that Beth Israel Deaconess Medical Center in Boston uses wireless networks to more efficiently track the location of costly medical equipment and to track the locations of patients and its medical staff. Dave Fiser notes in "Wireless Technology Empowers Physicians" (December 2004, that an Ohio hospital has equipped its physicians with wireless personal computers, thus enabling them to gain instant access to critical patient and medical information such as test results from any location. In "Georgetown Hospital's Kids Mobile Clinic Rolls with Verizon Wireless Broadband Connectivity" (May 12, 2006,, the World Technology News describes how Georgetown Hospital's Kids Mobile Medical Clinic, which delivers pediatric care to underserved children, outfitted its forty-foot mobile pediatric clinic vehicle with wireless service, thus enabling high-speed Internet connectivity to upload and download electronic medical records and access other online information to improve patient care.

Online Patient-Physician Consultations

In the report E-Encounters (November 2001,, Keith MacDonald, Joanna Case, and Jane Metzger call online exchanges between patients and health professionals "e-encounters" and define them as "a two-way Web-based exchange of clinical information between a patient and his or her caregiver that involves a closed loop conversation around a particular clinical question or problem specific to the patient. It may be initiated by either the patient or the caregiver."

Although no one is certain about the frequency with which e-encounters occur, the California HealthCare Foundation notes in "Health Plan to Pay Doctors for Web Visits" (May 24, 2004, that by 2005 an estimated eight million Americans had communicated with their physicians by way of electronic mail (e-mail). Furthermore, in "Attitudes of Americans Regarding Personal Health Records and Nationwide Electronic Health Information Exchange" (October 2005,, the Markle Foundation reports that 57% of Americans surveyed said they wanted to conduct secure and private e-mail communications with their physicians. With more than two-thirds of U.S. physicians and more than half of American adults online, the popularity of this practice is believed to be increasing. Some industry observers consider e-encounters simply as alternatives to telephone consultations, while others think they may ultimately prove to be more time efficient, affordable, and convenient than the "telephone tag" and frequent call-backs that commonly occur when physicians and patients attempt to speak by phone.

One advantage of e-encounters over telephone conversations is the patient's ability to communicate home monitoring results such as blood pressure or blood glucose levels in a format that is easily included as documentation in the patient's permanent (paper or electronic) medical record. Another advantage is that less time devoted to telephone calls improves the efficiency of the physician's office, thereby boosting productivity and potentially reducing practice expenses. Other electronic communications between patients and physicians' offices include appointment scheduling, reminders of follow-up visits, prescription renewal requests, and administrative functions such as billing, insurance verification, and changes of address.

Concerns about e-encounters center on privacy and security of patient information exchanged and physician reimbursement for the time spent in electronic correspondence with patients. Besides legal and privacy issues, some industry observers suggest that guidelines should be developed for e-encounters to ensure that they are clinically appropriate and are not used as substitutes for needed, but more costly, face-to-face office visits.


Jupiter Research Corporation finds in Online Patient-Physician Communication: Benchmarking Consumer Adoption (2004) that despite reported interest in online consultations—two-thirds of consumers surveyed in 2002 said they were interested in online access to physicians—actual consumer use of online clinical consultations was sparse: just 3% of Internet users said they engaged in online consults with their physicians. Jupiter Research predicts that the use of online consultations will not increase because of consumers' unwillingness to pay for this service. Most of those surveyed (92%) were disinclined to pay more than $10 for an online consultation, even if it spared them the costs, in terms of time and dollars, of a physician office visit. Jupiter Research opines that utilization of online consultations will grow only if health insurers determine that they are cost effective and offer physicians and consumers financial incentives to participate.

Health Data Management reports in "Payers Support Online Consults" (April 4, 2006, that in April 2006 two major health insurers, Aetna and CIGNA, announced plans to support patient-physician consultations online. Both companies will reimburse physicians for appropriate online consultations, and patients of participating physicians will be able to request appointments, renew and refill prescriptions, and review test results online. In 2007 CIGNA will offer Web-based services in Arizona, California, and New York. Users of these services will be responsible for co-payments.

Is Applied Technology the Solution to the Nursing Shortage?

According to surveys conducted in 2001 and 2002, most U.S. hospitals, where nurses comprise up to 25% of the workforce, are facing a nursing shortage with estimates of between 10% to 15% vacancy rates for registered nurses, licensed practical nurses, and nursing assistants. The shortage is expected to increase. In one study, the Projected Supply, Demand, and Shortages of Registered Nurses: 2000–2020, the National Center for Health Workforce Analysis speculates that the nation will be short by half a million nurses needed to care for patients by 2020. Many industry observers attribute the shortage to the profession's diminished appeal because a wider range of career opportunities for women are available. In "Why This Hospital Nursing Shortage Is Different" (Journal of the American Medical Association, December 4, 2002), Howard Berliner and Eli Ginzberg state that nurses themselves insist that working conditions such as caring for older, sicker patients, mounting paperwork, and reduced nursing personnel and other workers are causing the exodus from hospitals.

While hospitals are intensifying recruitment efforts to fill nursing vacancies, they are also looking at ways to improve working conditions for nurses. One approach to improving working conditions is the application of technology systems to increase patient safety and clinical quality—key factors that contribute to nurses' job satisfaction. Automated workflow and clinical systems do not always increase nurses' efficiency. However, in the report The Nursing Shortage: Can Technology Help? (June 2002,, Joanna Case, Mychelle Mowry, and Emily Welebob find widespread support for a variety of technologies designed to safeguard patients and support nurses, including:

  • Scheduling nurses to shifts by way of the Internet
  • Messaging and automated documentation
  • Mobile communication
  • Patient education
  • Medication administration systems—dispensing devices, bar-code technology, and "smart" intravenous pumps that check orders against a database to prevent errors
  • Clinical decision support
  • Computerized physician order entry and computerized patient record/data repository

The authors conclude that increasing adoption of technology, the urgent need for hospital nurses, and a generation of graduating nursing students that has been computer-literate since childhood should spur hospitals to consider integrating computer technology into nursing practices.


Despite rapid advances in technology, many industry observers feel that it is not sufficient to solve the nursing shortage the U.S. Department of Labor projects will require one million replacement nurses by 2012. In "Nurse Staffing in Hospitals: Is There a Business Case for Quality?" (Health Affairs, January 2006), Jack Needleman et al. report on their study of 799 acute care hospitals in eleven states. They find that U.S. hospitals could prevent an estimated 6,700 patient deaths, 70,400 complications, and four million hospital days of care by hiring more registered nurses and increasing the hours of nursing care per patient. Needleman et al. project that increased staffing would produce minimal increases in hospital budgets, ranging from 0.4% to 0.8% when offset by savings realized by reducing rates of medical errors and hospital lengths of stay.

Promise of Robotics

One technological advance that promises to reduce hospital operating costs and enable hospital workers to spend more time caring for patients is the use of robots. Once relegated to the realm of science fiction, the twenty-first century has seen a resurgence of interest in automated machines such as self-guided robots to perform many routine hospital functions.

Mike Crissey describes in "Courier Robots Get Traction in Hospitals" (USA Today, July 7, 2004) the "Robo-Cart," a motorized table that transports linens, medical supplies, x-rays, food, and other materials throughout the hospital. Another automated robot courier, a four-foot-tall cabinet with flashing lights and turn signals called "HelpMate," speaks in English and Spanish. The robots use wireless radio to call elevators and open automatic doors, and they communicate respectfully, saying "thank you" on entering an elevator and inviting hospital employees to "please examine my contents when making deliveries." About 120 robotic couriers were in use at hospitals throughout the country during 2004 and their ranks are expected to increase.

Some robots are involved in more than simply routine, menial tasks. As reported by Michael Smith in "Robotic-Like Device Cleared for Heart Surgery" (July 9, 2004,, in July 2004 the FDA approved the marketing of a robotic system to assist in heart surgery to open clogged arteries or reroute the blood supply around the blocked vessels. The robotic system allows a cardiovascular surgeon to perform heart surgery without touching the patient. Seated at a console with a computer and video monitor, the surgeon uses handgrips and foot pedals to manipulate three robotic arms that hold surgical instruments and actually perform the operation. The robotic system has also been approved by the FDA for use in other surgeries such as laparoscopic gallbladder surgery and procedures to treat acid reflux disease.

The Future Is Here for Pioneering Hospitals

In 2005 many hospitals instituted new technology to help reduce errors, improve safety, and assist nurses to perform their responsibilities more easily, accurately, and efficiently. For example, Kathleen McGrory mentions in "Laser Beam, Bar Code Help Nurses" (Poughkeepsie Journal, July 15, 2005) how the Vassar Brothers Medical Center in Poughkeepsie, New York, debuted bar-coding technology, which enables nurses to scan bar codes on patients' wrist bands, match them to bar codes on medication, and report the time and doses of drug administration. McGrory reports that other New York hospitals have embraced technology that just a decade ago sounded more like science fiction than fact. Kingston Hospital instituted an automated drug-dispensing system that uses thumbprints to record all medication transactions. For the past four years Benedictine Hospital has used a robot to sort and dispense all medication and has not had a single medication error. St. Francis Hospital uses robots and bar-coding of patients and medication to ensure the accuracy of drug dispensing.


The health care industry is awash in wave after wave of new technologies, models of service delivery, reimbursement formulas, legislative and regulatory changes, and increasingly specialized personnel ranks. Creating change in hospitals and other health care organizations requires an understanding of diffusion—the process and channels by which new ideas are communicated, spread, and adopted throughout institutions or organizations.

Diffusion of technology involves all the stakeholders in the health care system: Policy makers and regulatory agencies establish safety and efficacy; government and private payers determine reimbursement; vendors of the technology are compared and one is selected; hospitals and health professionals adopt the technology and are trained in its use; and consumers are informed about the benefits of the new technology.

The decision to adopt new technology involves a five-stage process beginning with knowledge about the innovation. The second stage is persuasion, the period when decision makers form opinions based on experience and knowledge. Decision is the third phase, when commitment is made to a trial or pilot program, and is followed by implementation, the stage during which the new technology is put in place. The process concludes with the confirmation stage, the period during which the decision makers seek reinforcement for their decision to adopt and implement the new technology.

Innovation to Improve Access

In April 2006 the state of Massachusetts made national news when it enacted a compulsory health insurance plan intended to extend health coverage to every state resident by 2009. According to Christopher Rowland in "Mass. Health Plan Seems Unlikely to Be US Model" (Boston Globe, April 14, 2006), other states have passed legislation aimed at providing universal coverage but none are as ambitious as the Massachusetts plan, which seeks to unite employers and health access advocates to achieve their shared objectives. In 2003 Maine passed a law to make coverage available for all residents by 2009, Hawaii requires all employers to contribute to health care coverage for their workers, and Illinois provides coverage for children up to age eighteen.

Conservative critics of the Massachusetts plan, which requires employers and individuals to purchase health insurance, consider the state mandate an unwelcome government intrusion on individual rights. Liberal skeptics fear that many individuals will suffer when forced to purchase insurance the state deems affordable, but still constitutes an unworkable proportion of their incomes.

Although it is not yet known how well the plan will work to improve health care coverage and access or whether it will be a model for other states, which have higher proportions of uninsured residents (Massachusetts has just 10% uninsured, compared with the national average of 18%), many states may look more closely at some of the plan's other provisions, such as its requirement that hospitals fully disclose cost and quality measures to enable health care consumers and payers to choose quality, cost-effective providers of medical care.

Communicating Quality

In Crossing the Quality Chasm: A New Health System for the 21st Century (2001,, a report on health care quality, the IOM sets forth six aims for improvement and ten rules for redesign of the U.S. health care system. These ten rules are:

  1. Care is based on continuous healing relationships.
  2. Care is customized according to patient needs and values.
  3. The patient is the source of control.
  4. Knowledge is shared and information flows freely.
  5. Decision making is evidence based.
  6. Safety is a system priority.
  7. Transparency is necessary.
  8. Needs are anticipated.
  9. Waste is continuously decreased.
  10. Cooperation among clinicians is a priority.

Rule number seven, on transparency, refers to the need for public accountability for the quality of the health care system. Health care consumers should be given information that allows them to make thoughtful, informed choices and decisions about health insurance plans and providers. Although family, friends, and health care providers remain consumers' primary sources of information about quality of health services, the Henry J. Kaiser Family Foundation, the Agency for Healthcare Research and Quality, and the Harvard School of Public Health find in National Survey on Consumers' Experiences with Patient Safety and Quality Information (November 2004, that more people said they had seen and used health care quality information in 2004 than in 2000 (35% and 27%, respectively), and the percentage that reported using quality information to make health care decisions rose from 12% in 2000 to 19% in 2004.

Survey respondents who saw health quality information about hospitals and health plans but did not use it said they did not need it to make decisions about their care at the time (68% for hospital information and 64% for health plan information), or the information they saw was not specific to their personal health conditions or concerns (53% for hospital information and 40% for health plan information). The Henry J. Kaiser Family Foundation concludes that information provided must be understandable and should focus on performance measures of plans and providers that show their commitment to safety, evidence-based practice, and patient satisfaction.

The requirement for transparency requires health care providers and plans to disclose information they previously did not share among themselves or with consumers. Furthermore, many health care plans and providers find that to compete successfully for health care consumers, they must demonstrate the ability not only to deliver health care services effectively but also to document and communicate measures of clinical quality and fiscal accountability.

Publication of medical outcomes report cards and disease and procedure-specific morbidity and mortality rates has attracted widespread media attention and sparked controversy. Advocates of the public release of clinical outcomes and other performance measures contend that despite some essential limitations, these studies offer consumers, employers, and payers the means for comparing health care providers.

Some skeptics question the clinical credibility of scales such as surgical mortality as incomplete indicators of quality. Others cite problems with data collection or speculate that data are readily manipulated by providers to enhance marketing opportunities sufficient to compromise the utility and validity of published reports. Long term, the effect of published comparative evaluation of health care providers on network establishment, contracting, and exclusion from existing health plans is uncertain and in many instances may be punitive. Hospitals and medical groups may be forced to compete for network inclusion on the basis of standardized performance measures.

Despite legitimate concern about the reliability, validity, and interpretation of data, there is consensus that scrutiny and dissemination of quality data will escalate. To date, consumer interest has focused on individual providers—local hospitals and physicians. When choosing between health plans involving the same group of participating hospitals and physicians, employers are requesting plan-specific information to guide their decisions. Companies and employer-driven health care coalitions seeking to assemble their own provider networks rely on physician and hospital-specific data, such as the quality data provided by HealthGrades, during the selection process.

The most beneficial use of the data is not punitive, but as inspiration and incentive to improve health care delivery systematically. When evidence of quality problems is identified, health plans and providers must be prepared to launch a variety of interventions to address and promptly resolve problems.

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