Public "safety net" hospitals, which provide health care to everyone, regardless of their ability to pay, need a safety net of their own to handle the costs of installing and maintaining the health care
information systems that will be required to build the National Health Information Network President Bush
envisions.

That's the view of chief information officers at several publicly funded local hospitals nationwide and their trade group, the National Association of Public Hospitals and Health Systems (NAPH). A technology gap exists between public hospitals and the rest of the health care industry, the group says. Increased federal funding for electronic health record (EHR) systems in safety net hospitals is essential to close this gap, the CIOs say.

Doubters need look no further than the experience of treating people displaced by Hurricane Katrina. The storm's aftermath highlighted the importance of a nationwide EHR system, NAPH says. Even jurisdictions far from the hurricane-battered Gulf Coast, such as Marion County, Ind., struggled to provide health care to more than 1,100 Katrina evacuees who had no medical records. Many could tell clinicians only that they were taking "one white pill and two yellow pills," said Dr. Virginia Caine, director of the Marion County Health Department. The county includes Indianapolis.

Indianapolis medical facilities, including the county-backed Wishard Memorial Hospital, struggled with what Caine called medical illiteracy to care for the evacuees. She said a national EHR system would have made treatment easier for clinicians and patients.

Public safety net hospitals, which bear the financial burden for providing care for the uninsured, cannot handle the additional weight of installing new health IT systems on their own, Caine said. If the Department of Health and Human Services wants to establish EHRs nationwide early in the next decade, it needs to help fund IT systems in such hospitals, she said.

Bridging the gap

In a policy paper released in September, NAPH said the federal government needs to jump-start the acquisition of health IT systems through direct grants, loan guarantees, or low- or no-interest loans. The group also urged the federal backing of health IT demonstration projects with safety net hospitals as part of HHS' plan to develop a national health IT infrastructure.

Scott Wallace, executive vice president and chief executive officer of the National Alliance for Health IT, said there is almost universal agreement in the health care industry, at HHS and in Congress that safety net hospitals lack the financial resources to develop health IT systems and that they need help from the government and the private sector.

"Safety net hospitals cover a critical sector of the population," Wallace said. "They cannot do it without adequate funding."

The presidential Commission on Systematic Interoperability, which Wallace leads, supported federal funding for safety net hospitals' health IT systems in a report released last month. The report states that HHS should ask Congress within two years to authorize financial incentives for health care providers to invest in IT using a targeted approach that includes grants directed at small, safety net and financially challenged providers.

Dr. Mark Leavitt, medical director of the Healthcare Information and Management Systems Society, agreed that safety net hospitals need extra funding to close the technology gap, and he said those funds could come not only from the federal government but also from private-sector health care providers, such as Kaiser Permanente. The health care giant provided a $1 million grant in June to support the Oregon Community Health Information Network's use of EHRs.

Leavitt said he also believes safety net hospitals should receive differential payments from HHS and the Centers for Medicare and Medicaid Services (CMS) for the care of people without insurance, with some of that extra funding earmarked for IT.

Recent research supports that approach. In May, NAPH released a survey it conducted of its member hospitals on health IT systems. The results sharply delineate the technology gap. The report states that "because of their unique mission and payer mix, many public hospitals are in tenuous financial positions, which, to varying extents, limits their ability to invest" in health IT.

NAPH's survey shows that a little more than half of the public hospitals surveyed had installed or were installing EHRs in inpatient, ambulatory or emergency departments, but only 40 percent had installed or were installing them in physicians' offices. Public hospitals also lagged in the installation of picture archiving and communication systems (PACS) to store and manage digital images from X-rays and computerized tomography (CT) scanners.

Although NAPH's survey results are clear, interviews with CIOs at safety net hospitals show that some public hospitals have made capital investments in health IT systems that equal those of for-profit hospitals. Conversely, some public hospitals deal with a deeper technology shortage than some of their safety net peers.

Mikki Stier, senior vice president for government and external affairs at the Broadlawns Medical Center in Des Moines, Iowa, said the 200-bed safety net hospital could be the poster child for increased federal funding for health care IT systems.

To upgrade the hospital's aging systems, Stier said Broadlawns had to ask Polk County, which includes Des Moines, for a one-time emergency levy of $3.4 million in its last fiscal year, which ended in July. Broadlawns needed the levy because of the financial strain imposed by its patient mix. About 62 percent of the more than 150,000 patients treated each year at the hospital and its clinics are uninsured, the third-largest uninsured population of any hospital in the country, Stier said.

Broadlawns' IT systems used batch processing and ran on aging Alpha computers from long-defunct Digital Equipment Corp., according to Heath Bell, CIO of Broadlawns. The medical center maintained the museum-piece computers with a thin IT budget of $340,000 a year and a staff of 11. Funds provided by the levy will first be used to upgrade the hospital's patient registration and billing systems, with additional applications not deployed until 2008, Bell said.

Erlanger Health System, the safety net provider in Chattanooga, Tenn., which operates four facilities with a total of almost 500 beds, has an IT capital budget of $7 million this year and an IT staff of 110. Brad Brown, CIO at Erlanger, said the funds had to be used creatively because last year Erlanger absorbed $72 million in costs from treating the uninsured.

The provider wants to install a PACS to store and manage digital images, including X-rays and output from CT scanners. But because he cannot afford the capital costs, Brown said he has sent a request to vendors to lease a system on a risk- and gain-sharing arrangement. One scenario is a lease that will include a guaranteed reduction in film costs by using digital imagery, with a portion of that reduction in hospital costs shared with the vendor.

Brown would like to see additional federal funding for health care, but he also believes the government could help by backing development of standards-based IT systems to replace vendors' proprietary systems, which he said drive up overall costs and inhibit the exchange of information among providers. The development of health IT standards is a top goal for Dr. David Brailer, national coordinator for health IT at HHS.

Some safety net hospitals are healthier than others.

"We are not in the same dire straits as so