PODCAST/TECH: Glen Tullman, CEO Allscripts interview--What's the future for eRx and EHR?

This is the transcript of my HIMSS interview with Glen Tullman, the CEO of Allscripts. it includes some comments from Jim Morrow, an MD from Georgia who is HIMSS doc of the year too. The original audio podcast is here.

Matthew Holt:  ...It's Matthew Holt with The Health Care Blog. It's another of my HIMMS podcasts, and this one's really exciting. I have not only Glen Tullman, who is the CEO of Allscripts, which is one of the dominant players in the EMR market for ambulatory care, and moving to other areas, but I also have Jim Morrow who is a doc from...Where in Georgia, Jim?

Jim Morrow:  From Cumming Georgia, North Fulton Family Medicine.

Matthew:  Ah. From a medium‑sized practice, a family medicine practice in Georgia. He is an Allscripts user. Jim isn't going to be prepared for this, but we brought him here anyway. Anyway. Good morning, Glen.

Glen Tullman:  Good morning. It's good to be here.

Matthew:  We do this thing‑‑as my listeners are now familiar with‑‑with the mike, so it will fade in and out because it's not very professional. [laughs]. Anyway, first off Glen, you've been CEO of Allscripts since what? 1997, 1998, something like that?

Glen:  I've been with Allscripts for nine years now.

Matthew:  Right, so '98. And you had the joy of being the head of a public company, which went from a stock price of what, seventy‑eight or seventy‑nine in 2000, to two, or three, or something in 2002? And yet, you're still there. I can't think of any other health care CEO who's gone through that experience. Luckily the stock has been at more than two these days. So how did it feel in those dark days...

Glen:  Well, we've been...I'm fortunate, this is the third public company that I've run, two in health care, one in the property and casualty insurance business. We were the beneficiaries of the Internet "craze", if you will and the stock price ran up. I continued to tell our people that we hadn't accomplished our mission, but the market put a high valuation on us and the stock ran up to $89. Then it actually came down.

Our investors were fortunate that someone called us "the last man standing." It came down slower than most Internet stocks that collapsed; because we had a real business and a real vision. And I think, today we've continued over the years to execute on the vision, to build the infrastructure that you see working today. The stock market seems to be rewarding us for it.

Matthew:  Well, you guys made what, nine million bucks last year in profit? What are you scheduled for this year?

Glen:  Well, I'd like to talk about what we're accomplishing. I think the accomplishment is that the product is working for physicians. We have over 30, 000 physicians today, over 400 hospitals. When you do things right, when you deliver for your customers, the end result is profitability. So we're seeing a nice growth in our profitability. The analysts have put a number of different numbers on what we'll look like next year.

I think another key point I'd make is: We are actually reinvesting in software development, and other processes, more money than anyone else in the ambulatory sector. So we're able to provide a great return on products that are well priced. And also invest in the market. Things like the NEPSI initiative, which is a 30 million dollar investment for us over five years.

Matthew:  Let's move on to NEPSI.

That was the next thing that I was going to talk about. It's raised a little bit of controversy. So first off just give us a quick overview as to what NEPSI is. You have partners in this including health plans who are funding some of it, so it's $100 million over five years, is that right?

Glen:  That's correct. NEPSI really stemmed from the recent Institute of Medicine report, which was follow‑on to the first report. The first report said that 100, 000 people a year die from medical errors. This recent one focused on medication errors. It said that 7, 000 people a year die, and over one and a half million Americans are injured from preventable medication errors. As we read that report, I said, "We've been focused on this for nine years now and this is disgraceful. We can do better. This is America we know we can do better. We've got to figure out why physicians are not using this." We didn't blame the physicians because we know they would if they could. So we identified three issues: the software cost was one, how easy it was to use was the second, and the third was the lack of an incentive system that would promote utilization.

The idea behind NEPSI was to say: If we could make software free; if we could make it available from any computer‑‑which would eliminate their need to buy new hardware; if we could make it easy to use‑‑so easy that they could learn to use it and be writing prescriptions within an hour; and last but not least, if we could get some of the largest health plans in the country‑‑people like WellPoint, Aetna, Blue Cross/Blue Shield, Horizon Blue cross/Blue Shield of New Jersey‑‑to sign on and say: we will incentivize both utilization and adoption. If we could do that, we think we could actually address this problem. That's what NEPSI is about.

Matthew: Let's talk about that last plan. There were two‑‑what are the incentives that the health plans are going to be offering the doctors?

Glen: Well each health plan is offering physicians different sets of incentives. I was with the folks from WellPoint yesterday. If you're a WellPoint physician, and if you're located in certain states where they're starting to roll this program out, you can receive bonuses for both adopting electronic prescribing, which might be as much as one percent of what you get paid during the course of the year, and then you can receive another, up to nine or 10 percent, based on your utilization and your meeting certain metrics--so on generic utilization, on appropriate drug use, and the like, compared to your peer group.

If you think about it, that not only pays for the cost of the software, which of course, is free so it wouldn't take a lot. But those numbers can be very substantial to physicians. The whole idea is to incentive the right behavior and to make it easier for physicians to adopt this.

Matthew: Ok. So it would tie into the pay‑for‑performance stuff that WellPoint is doing in some of the other states? That's pretty interesting. Let's get to the heart of this physician adoption question. Perhaps I can grab Jim on this, because he's an early adopter. Very interesting. I too, when I put the post up about NEPSI I had my tag on the end that's‑‑You often hear that "free isn't cheap enough" and I guess we're now going to find out. Just by way of background, I wrote a report on e‑prescribing and the physician prescribing infrastructure, for the California HealthCare Foundation a year back, and I think the evidence is pretty much in. From folks like yourselves, and also a bunch of other players in the market, that yeah, there's a bunch of time saved in the physician's office if you can make it work with Allscripts, which I guess is not completely solved this year. But there's a bunch of time saved at the pharmacy, and it should make sense. It should pay for itself. So why aren't people doing it?

I got a couple of comments back, and I'll just paraphrase really one. But one says, it's a guy who says: "I ran an IPA. Our IPA paid for licenses for one of your competitors, paid for the wireless modems and paid a $1, 000 to those docs who wrote 200 'scrips in the first month or two. We couldn't get more than half the doctors to sign up, and one year into the program we even had the majority of the docs who had got the $1, 000 bonus, stop using it.

A similar comment from somebody else about both the NEPSI program, and the give‑away with NextGen with Wellpoint while back, and also some comments about Allscripts use in San Diego, and again the comments are that “this stuff gets rolled out and somehow doesn't get adopted properly. Even when it is being rolled out, it's not being used to it's full extent and people go away from it again”. I'd like you both to comment on that, because we clearly have a big problem in the country around this whole issue. We're at about twenty percent over all, but it's probably in the smaller groups below the big guys, down in the low teens or even below that. You look around the rest of the world most of the primary care doctors in the UK, in New Zealand, in Holland, in Norway are using this stuff in their office. So what do you think about those kinds of comments and what can be done to change the physician mindset?

Jim Morrow: I think those comments are sincere and I think they're really the general belief of a lot of doctors, but the biggest problem is that doctors are just so hesitant to change, period. Before I went on electronic records, I felt like I was a very good physician. I thought I took great care of my patients. I was wrong. I'm a good physician today because of the electronic record. If I had not made that change, I never would have learned of all the things I was not doing that I needed to be doing and the people who were not getting the care they needed.

It's a completely different world, but getting doctors to change is tough. Getting to change to something that's free is hard, getting to change to something they have pay for out of their pocket is even harder, because they have so little going into their pocket, they feel, as it is. But your correlation to the United Kingdom they don't have a choice.

Matthew:  Which helps, right?

Jim: Which absolutely helps. I'm a firm believer that's the one thing that's going to make people adopt, is you just say this is how you do it now. Just like you do electronic billing, now you're going to do electronic medicine. Until we have that happen we're going to have scanty adoption rates, because doctors will come up with every reason in the world to not do this, because it is a huge change in their process. The truth is their processes are broken. They're comfortable with them. They work on a given day, but they do not provide what they need to provide to their patients. And until we do it, we're not going get there.

Matthew: Now, I love the comment you made about “I wasn't actually a good doctor, but I am now because of electronic medical record.” My understanding, and I always say this widely, "Sorry, guys. The EMR isn't here to make the doctor's life better, it's here to make the patient care better.” Say a little bit about what kind of things are you doing that you weren't doing before.

Jim: The ability to track lab results, for example. If I order a PSA on a fifty year old man, when he leaves the office in the paper world, I never think about the PSA again. If the result comes across my desk that's great. I'm glad I see it and I act on it. But if it never comes, for whatever reason, I never knew it. I have no idea how many times I had ordered a lab test that was never resulted. I have no clue.

In the electronic world, I can look every two weeks for labs that were ordered and not resulted, labs that were resulted and haven't been looked at, labs that have been resulted, looked at and haven't been seen by the patient. I've got lots of options now that I didn't have before.

It's very easy for me now to look and see now when a patient’s had a colonoscopy last and whether or not they're up to date on that, or a mammogram, or a pap smear, or a physical, or a stress test. Things that in the paper world are so cumbersome to find that in most case you just don't take the time to do it. Because if you take the time to do it, you're going to see fewer patients in a day and we already get paid little enough per patient as it is.

That, coupled with the medication tracking and the ability to look at interactions electronically and have it say, "Hey, this person is taking Lipitor. Are you sure you want to give them Biaxin?" I used to not be concerned about that. I used to not put a lot of though into that.

Now a days, I have no choice but to think about it. There's a big red flag comes up when I try to do that. That's an example that's not particularly important, because you give Biaxin for five or seven days. But if you put them on some other medication, it could interact with something they're taking on a daily basis. It's a real big deal.

Matthew:  I agree. I think that's a very eloquent expression.  You've been doing this for a while now.  Tell me a little bit about what happened when you first announced and when you first installed it. How did you and your colleagues deal with that switch process? When you went from the old way to the new way, and presumably you had some drop in patient loads while that happened.

Jim: Actually, we did this entire thing in 1998 because we needed to do better financially. So the last thing we needed to do was to drop our patient load. The day before we went electronic, which was December 17, 1998, we saw 101 patients in our clinic. The day we went electronic, December 18, '98, we saw 111 patients in our clinic. We did not decrease our number.

We told our guys, number one, this is how we do it now. Number two, we're not going to work less and we're not going to see fewer patients. And yes that means in the evening you're probably going to be here a little bit doing some documenting that you're not going to be able to get done in the exam room. Today the people that come work with us get the documentation done in the exam room, myself 100% of the time, most of my other docs 80‑85% of the time on the average. And nobody is there after five o'clock. We've expanded considerably, but we see 450 people a day and at five o'clock it's a ghost town.

Matthew: That's great. That's a great story. It's one of those success stories we ought to try to keep getting out there and evangelizing actually is a big part of this.

Jim: The only reason that it's a success story is that failure was never considered to be an option. The only thing that's going to keep doctors from successfully implementing electronic records is a choice to fail. Because it's ridiculous to fail at this. There's no reason in the world you can't do this. You just have to decide that now this is what we're going to do and we're going to be good at it.

Matthew: That's great. Glen, are you seeing the switching process that Jim described. Is that fairly typical for an EMR installation for Allscripts? You hear stories from things like the Kaiser installation of Epic, where they're going down to half patient load for some time. A lot of people hear that and get terrified. What's the typical installation? Is Jim particularly special?

Glen: Let me first make two comments about what Dr. Morrow had said. We have a lot of physicians that are absolutely, as Dr. Morrow is, world class terrific doctors providing great care. The issue is, we haven't equipped them with tools to allow them do their jobs in the way we know they can. And this is the only industry in our entire economy where we haven't used technology to improve quality and reduce cost. We are now and that's a great aspect of what's going on.

Second, the most important point, I think, that Dr. Morrow made is the leadership point. And this is about deciding that we're going to do it. Governor Bredeman, in yesterday's address, said, "Stop talking and stop getting ready, and get going."

I think that's the message, which is “don't get ready, get going,” that we have to communicate to the market. We don't allow people to drive without a license. We don't allow people to do other unsafe things. We've got to get that message across. And I think you're going to see some state leadership along those lines. Where states actually step up and say, "It's now free. It's now easy to use. It's not an unfunded mandate and we're going to require that this be used." So they're going to help us along in the process.

In terms of your question, relative to adoption, I think this is largely vendor driven in the sense that only today we're starting to get the systems that are very use‑able, very easy to learn. I don't know if you've gone on to the NEPSI site. If you have, what you'll see is that this is truly a product that can be used; you can write your first prescription within thirty minutes. That's the kind of commitment, we've got to get the software that good, that valuable and that smart making it free, getting incentives in place.

This is why a coalition is required. In the past we had individuals trying to do it. We now have a coalition and we have leadership from physicians like Dr. Morrow, like Dr. Azark Korby in New Hampshire, who're actually coming out and saying to their fellow physicians: "We have to do this. We have to step up and deliver better care. We know we can, that's why we entered medicine." I think that's the message.

Relative to, you mentioned one or two names, some of the failed implementations that are out there, the reality is that is largely a function of the software. You can't blame the physicians for software that's not fitting into their workflow, that's not running effectively. I know the industry would like to say it's a physician problem; my view is that the issue is the physicians were doing just fine; you gave them software and if it's not working, part of that is that the software isn't intuitive and it's not easy to use. Because physicians are very intelligent, they're going to use things that help them do their job better. It's that simple. So make it easy. Make it free. Make it available and they will come.

Matthew: Okay, let's move on to one other issue which was also raised in the comments to this and then we'll wrap up in a few minutes off of that which is the issue of privacy. We just had Janlori Goldman and Paul Feldman resign from the AHIC committee because they feel the issues of privacy aren't being looked at closely enough within the whole AHIC set‑up. You're obviously deeply involved in that. You get the impression there are some Americans who won't trust anything [laughter] no matter what it is and yet we all know there's a whole bunch of stuff known about us that we don't know about and all the rest of it. But nonetheless, what do you think about the privacy issue?

And I want to raise too there's been a little bit of comment about the relationship that you guys have with Google. There's been some other speculation about what you guys have been doing with Google elsewhere in the press. So could you comment a bit about privacy and then we'll move on to Google in a second.

Glen: Sure. Well, in terms of privacy, we take this very, very seriously. All of our products not only meet but exceed all the requirements set forth in HIPAA. We have tremendous respect for patient privacy. All of our products not only address it from a privacy standpoint but from a security standpoint as well. So I don't think you'll find an organization that takes that more seriously.

I think we have to balance the privacy issue with the issue of saving lives. There are people, as you suggest, that are going to fight any kind of automation, any kind of centralized database. But the real question is when someone's in an emergency room and the ER‑doctor has to make a decision about whether to give them a medication that could potentially save their life they don't have the chance to ask them right then and there in all cases, maybe a car accident, "what drugs are you taking?" or the like. We have a number of procedures built into our products that are called "break the glass" procedures where there's a life‑threatening situation; there are a number of procedures they go through to get access to that information.

With that exception, we protect patient privacy one hundred percent. I think that's a requirement for anybody in this business. We take it seriously. We'll continue to meet and exceed every requirement for patient privacy out there. We think it's very, very important.

Matthew: Okay, let's talk a little bit both about the relationship with Google on the NEPSI site. And also you guys are obviously investors in Medem in the personal health records base, sort of providing physician connectivity to their patient base as it were. So just give me a couple of thoughts about what's going on in those two arenas because they're not the core of your business but it's obviously an important peripheral part.

Glen: Sure. Let me start with our relationship with Google. As you mentioned, we really have a who's who list of sponsors for the National Prescribing Patient Safety Initiative beginning with Dell at a national level and then adding names like Microsoft, like Fujitsu, and a number of others. Google is our search sponsor. One of the things that, when we surveyed physicians to design this product, they told us is they use Google all day long to do searches along with other search engines and they'd love a simple search. But they'd love for that search to be healthcare specific and was there a way to do that? Google not only agreed to become our search sponsor but the Google search that takes place on the eRx Now product is healthcare specific. There's an extra level of search that qualifies the search for healthcare.

That information in relationship with Google is totally opt‑in. In other words, if a physician never decided to use Google search at all, they could use the product. They could actually turn off the Google search and disable it from the product so all that's fine. To the extent they decide to use Google, it's no different than if they went on their own computer and used it; they're opting into Google's set of rules of what they do with the information. There are specific, again, specific kind of disclosures on there they say "you're now entering a different system, it's the Google system and you should be aware of that". There's no other information sharing agreement in all the information that is recorded as a part of the NEPSI processes protected; it's separate, it's confidential. There's no mixing of those two groups. It would be illegal to do so, frankly.

Matthew:  Do you expect any other announcements for Google? Or I guess you can't tell me.

Glen:  [laughter] You've already answered that so...

Matthew: [laughter] all right, let's move on to the Medem relationship and a little bit about where you think the whole EHR thing is going and how they integrate. I had a good argument with a guy, Bob Lorsch yesterday, who has a standalone, basically, fax‑in vault PHR system. As you probably know, I was in a PHR company that unfortunately didn't do as well; it had the crash without the recovery that you guys had! [laughter] This is one my little pet peeves: when is this going to take off and when are the providers and the plans going to be providing data? Where do you see the whole Medem thing going and the other EHRs involved within? How are you going about the issue of auto populating those PHRs? Where is that whole thing?

Glen: I think that the good news here is that a year ago we had electronic medical records. Those electronic medical records said we're going to automate inside a physician practice. Then someone like Paul Bernard, someone said we may want, as we're building this electronic highway, we may actually want to involve other people like patients. [laughter] That was kind of a novel thought but it was a very good thought. We took an initial step making an investment (in Medem)...with made that investment to support the AMA and about 46 other medical societies who are trying to advance patient care, who are trying to make sure that that patient care is delivered through the physician, not around the physician to the patient, and we support that as well.

So from that perspective, we've been a big supporter...it's integrated into our products so you can exchange information, physicians can communicate with their patients and vice versa. We also however, push interoperability, so we've made it very clear that we will connect to and talk to virtually any quote‑unquote non‑proprietary personal health records. So, for example those are being built by Relay Health, and we have an agreement with Relay Health to exchange information. Those are being built by people like Revolution, Steve Case's company, and we are happy to ‑‑ we don't connect to them today ‑‑ we would be happy to work with them.

Microsoft and Google are likely to have personal health records, so we're going to see a tremendous amount of innovation in this area, we think it's good, we think it's healthy, the only thing we don't think is healthy, is when individual vendors try to build their own. Because what they're doing there ‑‑ some of our competitors are doing that ‑‑ is essentially creating more silos, and we don't think we need silos.

So, from that perspective we see tremendous activity there, we see lots of innovation and we're happy to connect our electronic health records, both our HealthMatics and our TouchWorks records to every one of them.

Matthew: I wasn't at the NEPSI launch. But I saw the video a bit later and you basically came out and said that ‑‑ which is I think is a very true statement -- if we don't get this right eventually it's going to happen to us. This is the general health care reform angle ‑‑ we've seen the last five years in which although plenty of money has been made by various people in health care ‑‑ the problems of costs and the uninsured and all the rest of that are, you know, really getting to a national visible level. That means single states ‑‑ my state of California, obviously elsewhere too, a lot of people are all launching different initiatives, and it's kind of clear that something has to be done at some point.

What's your general take on that, and what kind of solution do you think you'd like to see?

Glenn: Well you know Jerry Garcia from the Grateful Dead I think said it best, and he said you know, something has to be done and it's just pathetic that it has to be us to do it.

[laughter]

And you know ‑‑ I think this is the time ‑‑ I think business has made it very clear, as the government has made clear that this is really the last opportunity that we will have the chance to help set that agenda. Business can operate in the United States and continue to operate cost effectively ‑‑ states are talking about a third of their budget's going to health care, we have waste on the order of 30 to 40 percent, which is 700 billion dollars of waste and that's more than enough to treat the forty million or so uninsured or under insured, so there's tremendous opportunity here, and we have to step up. We need the leadership to make that happen.

I think it is happening now ‑‑ you know in the United States we've had this curious phenomena of protecting two areas and saying they are too sacred for business to get involved in ‑‑ health care and education ‑‑ and yet if you look today at what's happened those are the two areas that are fundamentally broken in this country, and we need to use software and technology to improve the business process, to improve quality, and take costs out of that. And the great thing about technology is it allows you to do that.

So again I see it happening, I see us moving along the path, I see adoption happening, I would love to see some states step up and start to acquire some of the basics. I would love to see the continued work from CCHIT where I serve on the board of trustees or governors continue their efforts in terms of standardization ‑‑ all that is very helpful, and then we have to see the actual user step up and say we're going to make this happen.

I think the work that LSU ‑‑ which Steve Ballmer from Microsoft talked about ‑‑ the great work from ‑‑ that's going on at LSU, of going from a system that was all paper based and lost a quarter of a million patient records to a system that's going to be literally the best in ‑‑ if not the country, the world. In terms of being fully automated. Now they get to start from scratch, and that's a good news‑bad news situation but they are making it happen and they simply said, we can can do better and we have to do better now.

And I think that ought to be the message.

Matthew: Great, ok so the last question. You're a young guy, you've been in business in what, about 20 odd years, you've been very successful, I assume that the Tullman household isn't going short of the odd, you know, shoes for the kids feet and that sort of stuff. You also have strong interest in outside charity work, I know you're involved in juvenile diabetes and some other stuff, and you have. Some of your statements are inferring that you're probably in the sort of liberal Republican zone, is that a correct assumption? I've made that assumption anyway.

Just so happens there's another young successful guy who's had a very stellar career from your own home state, and he's looking for a new job in 2008 as well. Which means there may be a vacancy in the Senate. Are you thinking about that?

Glenn:  Well I think you're ‑‑ we're blessed in Illinois with two great Senators. Senator Dick Durbin and Senator Barack Obama, and I'm, I'm a well known supporter of Barack ‑‑ he's a good friend, I was a supporter in his Senate campaign, and I'm a supporter of him in his quest for Presidency. And I think his whole approach to what we have to do nationally is to go after some of these problems because we can, and because we need to.

In terms of speculation in the political arena, the only thing I'd say there, and it's a question that I do get asked is that, I think the ability to make a difference on important issues is what drives me in the business world and in the philanthropic world. So as I evaluate options going forward, whatever is the best way to make that happen is something I would consider. But let me be very clear, we have an enormous task to do, in health care, and until that task is done I don't plan on going anywhere, so unless my board tells me they have other plans for me ‑‑ you know with Barack, I'm hopeful there will be a vacancy, I can say definitively that I would not be interested in filling that vacancy in the time frame we're talking about.

Matthew:  [laughter]

Glen: So I guess that's a political answer, but it's actually one that's pretty definitive. So I won't ‑‑ I won't be running for Senate from the state of Illinois, and there maybe something that happens in the long term future, but right now we're about fixing health care.

Matthew:  Great, and thank you very much for your time.

Glen:  Thank you very much, great to talk to you and I hope that this is useful to all of your listeners.

Matthew:  Thanks so much.