MEDICAL DEVICES:

THE CHALLENGE FROM

E-ICU

Team DANIN

Marc

Uemura

Mehdi

Sina-Khadiv

Janet

Lim

Ninad M

Deshmukh

The Healthcare Juggernaut

Healthcare Costs in US

$2.4 Trillion

Hospital Care

$720 Billion

ICU Care

$55 Billion

?

What is Wrong with the Current

State of ICU Care?

• Increasing number, activity and costs of ICU patients

• 20% of ICU patients have adverse events

Clinical Challenges

• 54,000 lives could be saved annually with adequate ICU care

• Operations routinely cancelled/ rescheduled due to lack of ICU beds

Lack of Resources

• ICU care comprises 20-34% of total hospital costs

• Only 12% of patients go through ICU

Super High Costs

Who can disrupt the ICU Care

Status Quo?

• Combines high-tech software with Health IT

• Allows Intensivists to care for ICU patients from a remote location

• Possibly reduces costs and improves results

eICU

What can eICUs do?

• Relay vital signs, lab values and other monitored parameters to remote location

• Provide alerts to bring abnormal values to attention

• Provide high resolution monitoring and two-way audio in all patient rooms

• One Intensivist and two critical care nurses can interpret this data and make appropriate clinical decision

• Relay these decisions to on-site clinicians who can carry out these actions

We are The Incumbents

Hospital systems that have not adopted eICU

Academic Medical Institutions

University of California Hospital System

Who are the Insurgents?

Hospital systems that have adopted eICU

Some

Academic

Institutions:

University of Pennsylvania,

University of Mississippi

The US Army:

Tripler Army Hospital in Hawaii to monitor patients

in Guam

Some Private Institutions:

Sentara Healthcare in Virginia,

Advocate Healthcare in Chicago,

Avera Health in South Dakota,

Sutter Health in California,

Geisinger Health System

How does the ICU market space

look like?

How Big is Hospital Care?

Total Healthcare Expenditures :

$2.4 Trillion

Hospital Costs:

30% of Total Healthcare Expenditures $720 Billion

4,900 hospitals in US offer in-patient care

36 Million patients treated annually

And how about ICU Care?

12% of hospitalized patients require ICU care

4.2 Million Patients

ICU Patients cost a total of $125-200 billion annually

22-34% of hospital costs

Direct ICU care costs about $35-55 billion annually

20% of total hospital costs ($140 billion)

Do you know?

There are not enough Intensive Care Doctors to take care of everyone

There are only 6,000 Board Certified Intensivists when 24,000 are needed

There are 60,000 adult ICU beds to take care of 4.2 million patients annually

And on top of that…

Adverse Events (E.g. Unexpected Cardiac Arrests):

16.6 per 1000 ICU Patient Days

• Adverse Event: Unintentional injury/complication that resulted in disability/incapacity at the time of ICU discharge, death, or prolonged hospitalization and that was caused by healthcare management rather than the patient’s underlying disease

• 6.1% of deaths were found to be preventable

• 36% of adverse events were preventable

Frequency of Medical errors:

2 errors per patient per day

• Error: Error of Execution/ Error of Planning

The Bottom Line

There exists an untapped market

• Tap it before insurgents capture it

• Address it before an insurgent changes the rules of the game forever

Inefficiencies exist in the ICU ecosystem

• Remove them before they lead you to a slow death

• Address them before insurgents make the system unsustainable

What Are The Challenges For

Incumbents To Adopt eICU?

Special Patient Base

Academic Institutions get complicated patients with more complex diseases

• Need to be cared for by someone who understands all their medical problems

• With an eICU, the physicians don’t know their patients intimately

Mission & Money

Academic Medical Centers have a mission to teach and do research

• By implementing eICUs, cannot teach residents intimate ICU care

• Importantly, risk losing research funding money linked with direct patient care

And….

• Adverse outcomes from new technology can ruin hospitalsRisk

• Uncertainty in future regulations for eMedicineRegulation

• eICU would not fit into society’s perception of carePerception

• eSecurity: Loopholes may result in compromise with patient dataPrivacy

• Change of status quo can affect team-workChange

Err… what is the strategy?

So What Can Be Done?

The Profit Equation

Revenue Cost Profit

More Patients

Reimbursements

• Private Insurance Companies

• Government: Medicare/ Medicaid

Equipment/ Medications

Staff

• Physicians/ Nurses

Reimbursements are moving towards being dependent on patient outcomes

$-

$20,000

$40,000

$60,000

$80,000

ICU Costs: Mechanical Ventilation

Average ICU Cost Per Patient

High - ICU Cost Per Patient

Day 1 Cost

Day 2 Cost

Source: Daily cost of an intensive care unit day: the contribution of mechanical ventilation, Dasta JF, McLaughlin

TP, Mody SH, Piech CT, The Ohio State University, Columbus, OH, USA

0.010.020.030.040.0

Patients Requiring

Mechanical Ventilation

Patients Not Requiring Mechanial Ventilation

D

a

y

s

ICU Stay: Mechanical Ventilation

Average ICU Stay

Upper Limit - ICU Stay

What it means…..

ICU costs are highest on first 2 days and stabilizes after

Mechanical Ventilation is associated with significantly higher costs

Decreasing length of stay or length of mechanical ventilation would decrease costs significantly

Source: Dasta study - “ICU costs”

Finding Efficiencies…

Moving a patient from an ICU to non-ICU hospital bed Cost Savings

• As long as patient’s health outcome is not compromised

• Source: Norris Study – “ICU Costs”

Increase the number of intermediate care beds to transfer patients out of ICU

• If done efficiently, this can increase availability of ICU beds and decrease costs

Finding Efficiencies…

Train Nursing Staff for Sicker Patients

• Patients who are in the ICU can be transferred out more quickly

Make price information available to physicians when they order tests

• Physicians order less tests when they know prices Cost Savings

• Source: Effect of Price information on test ordering in ICU

Changing Mindsets

Create “Closed ICU” Interdisciplinary Team

• Having a Pharmacist in ICU can improve patient outcomes and decrease costs

• Decreased length of stay and mortality

• Lower percentage of re-admission to ICU

• Benefit to Cost ratio of 6:1

Have dedicated “Morbidity and Mortality” Conferences

• Decreases adverse events and costs

• Improves patient outcomes and revenue

Decrease demand for ICU Care

• Laparoscopy instead of Laparatomy

• DaVinci Procedures

Taking Necessary Steps

Improved Profits

More Patients (Revenue) Less Re-admits (Savings)

Improved Care

Less Adverse Events Better reputation

Invest In

Intensivists Training Equipment

And Importantly… Focus on Key

Catalysts for Change

• These catalysts will enable providers to get live assistance through internet

• Families can be updated by video conferences/ internet based communication platforms

Web 2.0

• Leverage the cloud to reduce day-to-day operational costs

Cloud

• Faster access for providers anytime, anywhere

• Quick response to patients through alert systems

Smart Phones

Final thoughts

The Big Picture - I

Profits will be driven by improved patient outcomes

• Future of Revenues: Bundled Payments

Efficiencies need to be improved to prevent insurgents from taking over

• We need to cut costs, inefficient archaic methods, all without compromising patient care

The Big Picture - II

We are entering an era of leveraging existing technologies to build new applications

• eICUs have come up at the beginning of this era

Possibly, a much better integrated framework for hospital management in totality might be in the wings

• It might be in our best interest to let the eICU opportunity pass but be ready to adopt the big one coming up