Becker's Hospital Review

36 CIO / HEALTH IT Viewpoint: Why it's time to nix IT departments By Jackie Drees W hile IT departments are designed to oversee digital transfor- mation, the idea of siloing staff with expertise in IT manage- ment into one separate division is the main force preventing companies from being innovative, according to Joe Peppard, PhD. Dr. Peppard, who is on leave from his post as principal research scientist at MIT Sloan School of Management in Cambridge, Mass., penned a Nov. 27, 2021, op-ed in e Wall Street Journal explaining why it's time for businesses to get rid of the IT department. Six notes: 1. IT departments "are for a bygone era and are ill-suited to the demands of the digital-first world," Dr. Peppard wrote, adding that the issue with this division stems beyond talent. "We all love to complain about our IT departments — blaming the peo- ple in them and their leaders for living in their own worlds, and for being unresponsive to business needs. … e problem isn't with the people or the leaders. It's with the whole idea of IT departments in the first place, which sets up IT to fail." 2. e IT department was originally known as the "computer depart- ment" and had the main focus of ensuring the company's computers were running smoothly. But as business and technology blend in today's world, keeping all staff with IT knowledge and leaving IT decisions and activities "to a department that is figuratively and sometimes physically far from the so-called core business is a recipe for disaster," according to Dr. Peppard. 3. Many companies follow the "partnership engagement model," which involves having IT as a separate department that serves as the partner to the "business." is model positions the IT unit as a supplier to the business, not part of the core functions of the company. 4. A separate IT department can reinforce the mindset that people working in the unit are doing it strictly because they love tech, not the other parts of the business. is can exacerbate a culture gap that stems from the idea that technology and business are separate functions of the company. 5. Several companies are moving to get rid of their IT departments and instead make IT part of every business unit, which is ushering in a "pro- found shi" that is designed to "realize value from IT as opposed to one focused on managing IT," Dr. Peppard wrote. 6. Organizations are now implementing a distributed network of pools of tech expertise and knowledge and integrating tech experts into each department so that all business units have knowledge in both key areas. "is fuses work relationships across internal teams to enable faster de- cision-making, greater visibility and shared ownership. And no hand- offs to slow down work," he wrote. n Scripps' Epic EHR automates supply price markups up to 675% By Jackie Drees S cripps Memorial Hospital's Epic EHR uses an auto- mated tool to mark up prices of supplies between 575 and 675 percent in real time within the EHR, The Los Angeles Times reported in December. A former nurse at the Encinitas, Calif.-based hospital shared screenshots of Scripps Memorial's EHR from earlier in 2021 with the Times to show the price hikes being automatically generated by its Epic EHR. Epic told Becker's in December 2021 that it does not com- ment on how customers use its proprietary systems. Some of the screenshots shared with the Times show an automated formula for marking up the price of su- tures, the basic cost per unit of which Scripps' EHR lists at $19.30. However, the computed charge per unit, or how much the patient and their insurer would be billed, is $149.58. Scripps' EHR automation tool uses the following equation to calculate the price for sutures: "$149.58 = $19.30 + ($19.30 x 675%)," according to the report. Epic lists the charge from the chargemaster, a Scripps spokesperson told Becker's in December 2021, add- ing that the health system provides a discount for cash payments if a patient does not go through an insurance company. If the patient does not have insurance or is underinsured and can't afford to pay, Scripps said it helps pay for or covers the cost through its charity care program. "Like most healthcare providers and insurance com- panies in the United States, Scripps Health operates under a system that was established decades ago and which is outdated," the hospital spokesper- son said. "It works like this: A healthcare provider determines charges (the 'charge master' or 'CDM') for its medical services — the list prices are indepen- dent of what commercial and government insurance contracts pay. At Scripps, we benchmark CDM pric- ing in our marketplace to make sure we set our list prices competitively." Scripps said it negotiates with payers for what it will be paid for services, similar to most other providers. Payers then determine separately from providers what they will cover versus what patients will pay, and "neither the insurance company nor the patient typi- cally pay list price," the health system said. n

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