TOPICS > Health

Extended Interview: Cerner Corp. President Trace Devanny

March 21, 2008 at 5:47 PM EST

TRANSCRIPT

SUSAN DENTZER: I’m speaking here with Trace Devanny. And you’re the president of Cerner Corp. Let’s start by talking about why Cerner got the idea that needed a community to test out some of the advances, actually let me stop for just a moment.

So what was it that led Cerner to go looking for a community in which it could test out the various principles behind the EHR and pull everything together into the HER and PHR system.

TRACE DEVANNY: We’ve always been a company of great innovation. We’re fortunate that the three founders that began this journey in 1979 are still with the company. And to that end we’ve always looked for, I mean we’ve always assumed a leadership position. It was a very active search that we conducted looking for a community that was, that was wired, connected if you will and there’s not, there weren’t many of those in those early days.

And Winona actually fit the bill and having a very forward thinking leadership and a group of clinicians that were anxious to change health status. So we, being the company of great innovation, one that I think has always assumed the leadership position in our industry, gravitated toward Winona as a place to test drive many of our critical initiatives, not the least of which was the electronic health record. So it was a very nice marriage that was one of convenience in those days.

SUSAN DENTZER:And to state the obvious, the reason you needed a community that was wired was . . .

TRACE DEVANNY: Today health care’s for the most part a very manual process. Most of the clinical processes historically have been manual — paper based. We believe that in order to change health care to transform the industry you must have a digitized medical record and they have the broadband capabilities already in place back in the mid-90s to support that, that vision.

So they were a natural candidate in a community under 50,000 inhabitants, so that was a nice size, so we could conduct our experiment around a personal health record with folks who really understood the value and there weren’t many of those in those days. So we were very fortunate that we came together.

SUSAN DENTZER:And the reason the community was wired was…

TRACE DEVANNY: Jerry Evans was the chairman of the board of Hiawatha Broadband, the local cable company and he had a vision for, for the community to have all of its inhabitants a part of the network, as a part of the network including the health care community of which he was chairman of the hospital, the hospital board. So he was unusual in that not only did they have the right energy around a vision, but they had the right people and the right positions to affect the change. Sixty percent of the population in those days [had] access to the Internet — very high numbers.

Even today, I would say in the world of the Internet that would be a pretty high number. So they were well positioned to take the advantage of what we offered. We were very anxious to understand a community: what we could test — this personal health record approach as a part of a broader platform that we described as Millennium, a relational database that gives access — ubiquitous access — to patient information. So they were a very good fit; and the leadership, I think, neither one of us understood quite how hard it was going to be. But in the end I think we both had a vision. We stuck to the vision and I think we were very successful as a result.

SUSAN DENTZER: What are some of the questions Cerner was hoping to answer by having this test, this experiment?

TRACE DEVANNY: That’s a great question. Could you in fact change health status by linking electronically everyone in the community? Could you fix many of the holes? Could you solve many of the challenges from a paper-based health care record system?

And we believe that and we’ve invested heavily to support that theory. And that theory has been borne out. We really do believe that in order to change health care, you must have a digitized version or an electronic version of a health record. They were a natural because of their vision, because of their investment, they were a natural place for us to try that. I mean it began as IQ Health, which was our initial offering for personal health record, and the strength of the solution is the fact that it goes from the personal health record to an ambulatory or an outpatient setting all the way to the most acute inpatient settings.

So it’s that common platform across the community that allows ubiquitous access to that information that makes all the difference. And I think a fore-runner to what you will see in the years to come across America and across the world.

SUSAN DENTZER: Now why were you thinking of starting with a personal health record ?

TRACE DEVANNY: You really start in the inpatient setting and we work backwards toward the individual. The Internet wasn’t as sophisticated a vehicle. It wasn’t as secure, it wasn’t as available as it is today.

But we believe that a patient-centric approach, a person-centric approach is the only way to solve and to involve those individuals, the person in their care plan, so we started in the most acute settings, the ICU, … all manner of clinical venues of care and worked back into the outpatient setting and ultimately connected the dots with the availability of a personal health record.

So we really didn’t go from the inside out, and it’s more difficult because not everyone has an aptitude or interest in working with the computer around their patient record. As the baby boomers become more a part of the nation’s demographic, you will see more and more activities around person-centric care. People engaging in their own health care delivery process and managing that process.

SUSAN DENTZER: So, to restate this, you started the process from the inpatient out, but your sense was that until the patients are involved, the system really isn’t going to change.

TRACE DEVANNY: Absolutely. And, and it really begins with the digitized record. Without that, without that electronic capability there is no chance to change health care. And that’s why we’ve invested so much money and we spent our entire careers as a company looking at and working towards that end.

'The same for 1,000 years'

SUSAN DENTZER: And you said nobody anticipated it would be as hard as it was. What was so hard about it?

TRACE DEVANNY: Well you first had to have a community as we discussed with the leadership and the interest in changing their environment. That I think was the most difficult -- finding the right partner -- but at the end of the day -- changing the way people deliver medicine. Changing the activities of a caregiver, of a physician, of a nurse.

Those are the cultural changes that have been I think the most challenging and continue to be the most challenging even today. Health care's been delivered in very much the same way for the last 1,000 years. In order to change it you've got to create an electronic version of that information. That requires change across every care venue.

So that it's a journey, it's one that I think we began many years ago and we've done I think a nice job with this partnership we have with Winona, but we've extended it to many other communities as well. Including other parts of the world. But it's the changing of the clinical attitudes and then just having a wired community and a wired partnership with a vision, all those things don't necessarily happen by accident.

SUSAN DENTZER:Give me an example of a piece of physician pushback or patient resistance or just illustrate why this was so difficult.

TRACE DEVANNY: Physicians have been trained, nurses and caregivers have been trained in a retrospective way from the beginning of time. It was really not an opportunity to have information proactively available at the point of service until the electronic health record became available. But we believe that is the genesis for change. Could we stop?

SUSAN DENTZER: I'm looking for an example, maybe it's -- I don't know -- if you were actively involved in a lot of the meetings with the folks that went on it but just simply to give a sense of texture of why this process was as difficult as you described.

TRACE DEVANNY: Yeah, I think the fact that they've always delivered care in a similar fashion in changing the culture of the clinical community was a very difficult change. Doctors have been trained a certain way. They've been, they've come to expect a certain amount of help at the bedside and they are very busy people. Having to take the time to sit down and enter information into the system to make it electronically available to any and all caregivers was a big change in the way, in the processes of delivering care.

So it's been a cultural transformation that is still very much in place. I think the physicians that you will come to appreciate in Winona have had a very good experience and I think it's taken time and as time, and as they become more comfortable with the system and as they've seen the benefits, the savings and time, the increased, the improved outcomes, the improved care, the lessening of medical error -- all those elements that plague our system today have been addressed by the electronic health record.

SUSAN DENTZER: So what was the problem? The doctors didn't want to type? They were so used to dictating the notes to a nurse?

TRACE DEVANNY: Yes, yes. They didn't want to change. They didn't want to type. They were used to having nurses enter that information or other caregivers enter that information for them, and they ran off to the next patient.

But as I said the change is, in health care is the retrospective view that they've grown up with versus a prospective view that the electronic health record allows them access. The power of the Internet is at your fingertips if you allow it to be.

But old habits are hard to break and I think that has been the greatest challenge. It's not the technology. It's not the programs or the solutions, it really is involved with, with the changing of a culture. I think that's been the hardest path to follow.

SUSAN DENTZER: This is so counterintuitive in a way because you think of a physician as wanting to know the most at a point where the physician could really affect the health of the individual and what you're telling me is this situation where doctors were happier getting the MRI two days later than being able to call it up right on the screen.

TRACE DEVANNY: And I'm not sure that I would say they were happier. But that's the only way that they had ever known. Having access to that information proactively is a new dimension that they've never experienced.

The generation that's coming along today that obviously grew up on video games is a much more comfortable with technology and has a much higher level of expectation around what technology can do. We've seen physicians across the board, men, women, children across all venues of care, all embrace technology at their own pace and doctors are no different.

As they see the benefits, as they see the fact that they can change an outcome, it's been a much easier story to deliver. And I think you'll see only more acceptance going forward. But it is counterintuitive, but old habits are hard to break.

TRACE DEVANNY: The people that have done most of the work around the patient experience have been the nurses. They are burdened with a documentation task, their ability to spend time with the patient has been impacted by the requirements of documentation.

So having this information available electronically, having this information available proactively, prospectively, allows them to spend more time with their patient, it eliminates medical error and it does a much better job of creating a happier patient experience.

So I'm very, we were very committed to supporting all care venues and the nurses I think are the ones that I think stand to benefit the most because they're oftentimes the ones that have the burden of the documentation.

'Person-centric' technology

SUSAN DENTZER: So Cerner started discussing this relationship with Winona in 1997, you said. What point was it finally up and running to the degree that the initial imagine scheme had, had in fact imagined?

TRACE DEVANNY: It took a number of years to get to a point where I think we were both comfortable. The fact that they were wired wasn't enough. So access to broadband and the Internet was I think a prerequisite but they quickly realized they didn't have access to the critical information around the patient that was necessary to sustain and to create that electronic health record.

So it's taken a number of years. We've had a number of proof points along the way. They most recently have some live activity as a few weeks ago. But today 99 percent of their ED doctors are using the system, interacting with the system electronically.

I guessed a goal of 80 percent, so the community has embraced division. They're very engaged in the care process and I think every element of health care in Winona is wired including the pharmacies, the clinics and the multi-specialty clinics, the hospital itself, and it's taken, I would not say it has not, it's been a journey and the journey never ends and we will continue to make it better. We'll continue to make more information available at your fingertips to allow even a more appropriate outcome.

SUSAN DENTZER: What lessons have Cerner learned from this experience? And how have you incorporated those lessons into changes that you've made here in technology, in strategy, corporate strategy or whatever?

TRACE DEVANNY: We've had a chance to understand the impact of technology at a person, in a person-centric way. It's a very difficult laboratory to find all the right elements of a population that's manageable, of a population that's wired. We think we do a nice job of connecting, connected communities.

And that's creating the infrastructure across a broad community such as Winona in, in enabling that population to be a part of their care process. So you can look up your medical, your electronic record. You can, you can review your medications. The physicians and the nurses and all the caregivers can access that information any time, any place, anywhere that it's necessary.

And there's many places that need information; schools, insurance companies, that are outside the four walls of the hospital. So all of that is part and parcel to our vision, deliver the right information to the right place at the right time to allow a better outcome to occur.

And thus a healthier population. In all of those lessons that we've invested in over the years have proven to be true, and Winona is a great example of how it came together.

SUSAN DENTZER: How would you sum up though some key lessons learned? You said a moment ago it takes a lot longer to get physicians on board than you might have expected. What about on the patient side? Any clear take home lessons from this experiment?

TRACE DEVANNY: It takes a partnership. It takes a vision and it takes leadership to bring together all the critical elements for success when transforming a health care system. We have long believed that our vision was right, delivering the right information to the right place at the right time to allow better outcomes to occur and that has, and that has been our mission, very simply stated, very difficult to deliver, but I think that's the lesson we learned, that we are on the right path, that we can make a difference, that we can in fact improve the health status of the defined population and Winona I think will be the first to tell you that.

SUSAN DENTZER: We were told that one clear lesson has been that patients don't want to have to type in their own information into the record. They want to get information but they don't want to be responsible for getting it into the record in the first place. I'm wondering, I assume you agree that that was a clear lesson.

TRACE DEVANNY: It depends on your condition. I think for most people that are healthy it's the last thing you think about. If you go to the doctor it's because you have a reason to go, but as you age and as you become a part of a generation that moves from elective surgeries into chronic disease, there's a much greater level of interest to maintain those electronic health records.

So there's no question that a lot of that could be described as a demographic, as an age-based issue. It's not something that people jump up in the morning and say, 'I'm going to go, I'm going to go update my record.' But if you have a need or if you have a family member that has a need, it's a completely different story. And we found that population to be much more anxious to manage and to create their medical record, health record, and if they don't, they'll have their chance at some point as everyone enters the system.

'The patient record is sacred'

SUSAN DENTZER: What about lessons around privacy? Since at least in the abstract whenever the discussion comes up about EHRs or PHRs, privacy is the initial concern that people expressed.

TRACE DEVANNY: Yeah it's an issue that is absolutely crucial. We believe that the patient record is sacred. We have built all of our solutions to support the sanctity of that privacy. And we will continue to do so. It's one of the issues I think most of our constituents are most concerned about.

The technology is in place, we're able to do it and we've worked very hard to make sure this data is protected. But that's really all one can say is that the technology is available and we used every possible weapon to keep that information private.

SUSAN DENTZER: Just to mention some of the safeguards, for example, on setting up there in Winona: I have diabetes, I'm following my blood sugar counts, etc., etc., what does Cerner do to make sure that someone who might not need to know those things has access to that information?

TRACE DEVANNY: The security, we have many, many toolsets that are available, too, that are built into the design of our system.

So we take advantage of all available technologies and we build in layers and layers of procedure level to protect the individual patient. So the broader question is, if a patient needs, if it's not able to communicate, and you want access to that information, the reverse is really almost, almost a bigger problem.

If you come into an emergency room and you're unconscious, you don't want to spend a lot of time going through the privacy issue. You want to make sure that care is delivered as quickly as possible. But we're very sensitive to it. We have the best toolsets available in the technology today and it's all embedded in the architecture.

SUSAN DENTZER: And from the standpoint of 'where the data's actually housed?', we were told in the case of Winona, it's actually housed in this region -- not up in Winona -- on a server that could withstand tornadoes, earthquakes, give me a sense of just how secure it is in a way that an average person could appreciate.

TRACE DEVANNY: Well, remote hosting, or locating the data at a data center as we have done with Winona here in Kansas City, is really a fast-growing part of the industry, and those data-storage facilities need to be secure. They need to be tornado proof, they need to be flood proof, they need to be terrorist proof.

And those are very expensive facilities to build and maintain. It's a very important growth avenue for our company. It's working very well, and we will continue to invest as I think most, most of our clients have a difficult time attracting and retaining much of the cut, of the technical help necessary to sustain some of these clinical systems and these financial systems, these operational systems.

So they look to us to do it everyday across a broad spectrum of clients, to help them with that. And that's why we have successfully deployed data centers, a couple here in the United States and we'll have some additional data centers overseas to continue that piece of our business, that growth of our business.

SUSAN DENTZER:President Bush has called on the nation to have nationwide electronic health records by 2014. Your CEO's been involved in the American Health Information Community and the various ways of trying to take the roadblocks out so that that process can happen. What does the experience of creating this system in Winona suggest for the country as we push toward 2014, maybe make, maybe don't make that goal, but nonetheless push toward it.

TRACE DEVANNY: Health care in the United States is in crisis. We need to have a digitized electronic health record capability. We need a set of standards in an industry that has little or no standardization.

We need to build and inter operate between medical equipment and information technology. There are many things that have to be put in place in order for us to have a successful chance or an opportunity just to fix this burgeoning cost and this, what I would describe as an average health care system as you compare it to other nations around the world, to spend, frankly spend a lot less.

We've proven that an electronic health record capability in Winona can in fact improve health status. It takes a significant amount of investment. It takes a significant amount of leadership and I think that's where I think we've been, made such great progress. The lessons learned in Winona I think would serve the country well in that it is going to take a commitment. It's going to take financing and funding. It's going to take infrastructure in order to provide the backdrop to affect this health care opportunity.

So my belief is that if we are able to convince the government through our efforts in Washington, our successes in the marketplace, I think various communities and states as small as Winona, as large as the state of Minnesota and hopefully as large as whole countries will have a chance to be affected by what I think the rest of the world has acknowledged and that of the health care record.

We are very optimistic about the opportunities to, for technology to affect change and health care. It's a very expensive industry today, 17 percent of our GDP, $2.1 trillion, I believe, in 2007. A third of which, $700 billion of which, was dedicated to the administration of health care. Way too much money being spent and I think our outcomes aren't what they should be. So there's an opportunity for us if, with the presidential election in place, coming up. I think it's become a very important frontier discussion point for the presidential candidates. It's going to take some, I think some effort from all parties.

All constituents including Washington, the states, the Medicare, Medicaid, as well as individuals who are going to have to all agree that this is an important change if we're going to have any opportunity to make these dates of 2014. It's an expensive proposition that will require funding from the United States government and at the state level. So the private sector, as much as we'd like to become a private sector issue, we think that, that will be not enough to get it done.

SUSAN DENTZER: So you anticipate the need for federal tax credits, what exactly do you think is going to be necessary to get those on track?

TRACE DEVANNY: There's plenty of money in the system today. It's how it's spent. There are many things that we can do I think with the existing spending that would make a substantive change. It's an attitude and it's an understanding that the change must occur. We must have an electronic, a national patient identifier, and electronic medical record, electronic health record capability if we expect to digitize this information, make it available where it's needed most and that's at the point of service.

So there's cultural change, there's funding that will be required and I think a general leadership, an attitude about what must be done across all parties and all constituents to make this come true.

Impact of presidential race

SUSAN DENTZER: How much funding do you think would be required to get the nation on nationwide health records by 2014?

TRACE DEVANNY: Other governments may be the best barometer. The British government has earmarked a significant -- billions of pounds -- translate that into many billions of dollars to affect an electronic health record capability across England. The French government is very focused on creating electronic medical record capability across all of France.

So it's, the numbers, it's very difficult to predict what it would require. I think it's going to be a community-based effort. I think it's going to require state focus and assistance from the federal government. But to overhaul the entire health care system, it would be a difficult number to project.

SUSAN DENTZER: Economists for Rand Corporation have estimated that if the nation were on nationwide electronic health records, that net of the investment costs, the health care system could save $77 billion a year. What do you think? Is that high? Is that low, or is that on the mark?

TRACE DEVANNY: We were actually a part of the Rand study a number of years ago that looked at the feasibility of automating electronic health records across the United States. And these numbers came back I believe at about $162 billion of potential savings across a number of areas including medications reduction and redundancy of tests.

So there's significant opportunities to affect the spending and the cost but I think you have to start with an electronic basis and that's the digitized electronic health record as a fundamental starting point if you're going to have any chance to make a difference.

SUSAN DENTZER: If, as you said, because we know many of the presidential candidates are talking about electronic health records as part of a series of cost-saving and quality-enhancement initiatives in the health care system, if one of those folks is going to be elected, which is probably somebody will be elected president, would you expect the push to get even more aggressive in the years ahead?

TRACE DEVANNY: Yes, I think we're very pleased that health care has assumed a front-burner position on the agenda for all the candidates. I think the Democratic side, Sen. Clinton and Sen. Obama have been very specific in what they would do in the very near term. Republicans have also said that they will take on that issue in a very aggressive way, although they've haven't been specific at this point.

So yes, my belief is we will see a very, very aggressive agenda around health care reform in whom, with whomever becomes our next president. And given the spending and given the quality of the system and the situation in which we find ourselves, it can't come fast enough.

SUSAN DENTZER: And the various solutions that are raised by the candidates themselves as well as people who are not now running but have been very outspoken on the issue like Newt Gingrich, for example, they range all the way from tax credits to help individual physicians purchase it, there's already a CMS demonstration that's encouraging physicians to book these investments and give them, pay them somewhat higher rates under Medicare, Medicaid if in fact they do those things. What's in the bundle of things that Cerner thinks is appropriate to push all of this forward?

TRACE DEVANNY: The, there's no question that I think significant action has to be affected quickly in the new administration. I think it's going to take a collaboration of government, the private sector, the employers, as well as the individuals to move this meter if you will. I don't think that, as I say, it's a big challenge from anyway you look at it. It's going to take time but I think the fact that it's, we recognize that its time has come and it has to in fact become a household conversation. F

ueled most likely for not only the cost reason but certainly because the baby boomers who vote, who spend the money who are at that stage in life where they are going to need health care, all those I think, those issues will in fact put a lot more focus on the problem. When you spend $2.1 trillion annually, and you get the type of health care that's wrought with error, with medical error, with a lack of privacy, a lack of access, all those issues I think are a formula for disaster if we don't have someone take a leadership role and begging to affect change.

SUSAN DENTZER: Others have said and you perhaps have a message so we'd like to capture it, but that to the effect that health care is probably the most backward industry in the United States from an information technology standpoint relative to the size of the industry. How would you describe the state of utilization of information through technology and health care?

TRACE DEVANNY: I think if the largest industry in the United States, the largest industry in the world, but yet the last to embrace technology as an enabler to improve health status. To improve outcomes, to improve the population, the general health of the population. I'm not sure I know why it's been an industry that has lagged behind finance and insurance and manufacturing, but, in fact, it has. We spend a tremendous amount of money.

Are we spending it in the right way? And I think that, that is the answer we must answer. And that's what the answer to the next president has to answer because clearly it's not working. It's clearly a health care system we can't afford. It's one that's wrought with challenge. It's not safe. It has medical error occurs all too often and I think there's so many issues that could be affected positively by the application of technology but we just haven't done it. We have to do it.

And I think we're in a, we're on a path now unlike any time in our history to make change and to, to effect the change because the technology's available. Other industries have proven that it will work. We have to have the leadership and the will to take this issue and do something with it. To take, this is our time. With the baby boomers notwithstanding, this is an opportunity for us to do something we've never done before. And that's transform the health care system.

SUSAN DENTZER: So paint the vision for me then, 10, 15 years from now, how all of that comes together. A patient comes into the hospital, what happens that pulls together this vastly more efficient payment enterprise, this connection potentially with the clinical research enterprise, etc.?

TRACE DEVANNY: I think what you will see is an electronic health-record capability will become the centerpiece for patient-centric care in this country and around the world. I think you will find because of this tremendous amount of data necessary to support the electronic health record capabilities, the voice, the data, the images, all that, that make up an electronic health record require huge storage requirements.

So our vision is that this will become the utility in that some of the activities in Washington today we have been very supportive of some of our congressmen and our senators that have launched this integrated health information bank, bringing information together in the form of a utility that was, allows ubiquitous access from anyone who has a need to access a personal health record, whether it be a school, whether it be a government official, a government agency, whether it be a clinic, a hospital, an insurance company, they all have a need just to aces that, that critical electronic information. Today it's very fragmented, if you find it in many different forms, none of it really comes together.

It has to be digitized. We have to create a set of standards in the United States that will allow interoperability to occur in the ubiquitous access of not only the data but the movement of that data across any possible care venue.

That's what I believe we will see happen in the coming years and I think it gets, not only is it necessary to solve the challenge of the price, the cost in the friction, but it, if we don't do it we will, I think, put our entire economy at risk.

SUSAN DENTZER: And is the rest of the industry on board on that interoperability?

TRACE DEVANNY: I think for the first time we have, we recognize as an industry that we must change and I think there's better collaboration today across all competitors, all care venues than ever before. So it's a big conversation, it's one that hasn't been had in the past, and I think it's going to take a tremendous amount of government influence, to force some of the collaboration.

But at the end of the day I think the private sector has to take the lead. The private sector and the employers and the employers really are those that pay for health care today in most senses of the word. They're funding this health care system. So they have a lot to say about it and I think you'll find that that will force change unlike anything we've seen in the past.

SUSAN DENTZER: Secretary Leavitt several years ago simply told the industry come up with standards on interoperability or we'll give them to you. What's going to happen?

TRACE DEVANNY: The industry is attempting to rise to the challenge. I'm not sure that we'll get the short term, in a timely fashion. So I think it's going to be a bridge between government and the private sector in order to agree on a set of standards.

So I don't believe it's going to happen in the short term, and I really believe it's going to require some influence and the government's going to have to stay close and those of us that are in the private sector are going to have to work hard to get us there because it's not, it's a daunting task as it exists today and one that we haven't made much progress on historically.

I think we're going to see more change in our health care industry in the next 10 years than we've seen in the last 50. I think the technology that's available to us is if we meet the challenge we have a chance to make a real difference and frankly if we don't, we have a, I think we have a chance to have an economic crisis that will be very difficult to solve. so I'm optimistic that we as a company are positioned at the right place at the right time. I think the industry is aware now more than ever that they must change the standards and the interoperability questions that we discussed are clearly front-burner issues.

And I hope that the next president will have the political courage to take on these issues and help force the change back into the industry. We have to be a part of it, employers have to be a part of it, the government has to be a part of it, and I think the individual consumer will help drive it. So there's change afoot and I'm optimistic that we can play a role going forward in helping reshape the health care system of the United States and hopefully around the world.