“The biggest error in healthcare IT was believing it was about technological change only,” Wachter said, adding, this misguided assumption led Cedars-Sinai and other early adopters to underestimate the extent to which new technologies could disrupt workflow and require ongoing support.
“There is a productivity paradox,” he said, explaining departments often have to live with the new technology before they can see increases in productivity.
Cedars-Sinai has learned from its fiasco. Today it is considered one of the most-wired hospitals in the country, according to a survey by Hospitals & Health Networks, a journal of the American Hospital Association. But its approach to innovation changed significantly because of that experience.
Cedars-Sinai now consciously collaborates with people in-house to try to anticipate a new technology's effect on workflow and then make modifications when unexpected hurdles are encountered. It also closely collaborates with other health systems to amplify its return on investment. Technological rollouts are incremental and structured, so lessons learned in one department or in a different system can be broadly applied.
“We thought our needs were unique and special,” said Darren Dworkin, chief information officer at Cedars-Sinai Medical Center. In the aftermath of the fiasco, the health system found itself “caught between two goal posts,” not wanting to build its own software, but not wanting to wait for vendors to fill in the white space.
Now Cedars-Sinai works closely with other healthcare systems and tech companies to fill the gaps when there is a need but no market solution. The approach, which is increasingly common, allows it to share risk and bring small companies with new ideas into the fold. Perhaps most importantly, it allows the system to identify new business models that could be potentially disruptive.
Cedars-Sinai identifies startups with potential in part by investing in early-stage companies through its Tech Stars Healthcare Accelerator, which houses startup firms. Cedars-Sinai and Fountain Valley, Calif.-based Memorial Care Health System also run an $80 million Summation Health Ventures, a venture capital arm for investing in early to mid-staged companies.