The modern CIO's challenge: More tech spending without adding to overall organizational costs

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The role of a healthcare CIO today is changing. As most health systems have EHR systems implemented and integrated, the CIO now oversees the tech aspect of many projects and innovations and must negotiate financial investment appropriately.

Here, CIO of Michigan Medicine Andrew Rosenberg, MD, outlines his strategy to ensure responsible technology spending, which can lead to big savings in other areas of the organization.

Question: As CIO, how do you make sure you're a good steward of the dollars spent on technology?

Dr. Andrew Rosenberg: That's usually the most important question. I'm doing what I can to promote an increased percentage of the health system's expense to be used toward IT than we have done in the past. The idea is to be cost effective and find opportunities to reduce costs in non-IT areas that use technology to amplify that work. An example is robotic process automation for back-end transactional work. In my mind, we can and should be spending more in automation and bots in this case to not only replace more expansive and less efficient work, but free up people to do new types of work or allow us to grow without growing our backend infrastructure.

Distributed call systems, the command centers, are incremental investments in IT. My argument is that if you look at our balance sheet, there should be slightly increased spend in IT relative to other portions of healthcare, but you can keep expenses the same or lower by supporting growth without increasing traditional expenses. That's where telehealth potentially comes in.

The IT service desk is a small example of that. We have started to add the chat ability, which allows a single individual to manage sometimes four customers at one time, as opposed to one-on-one customer management through the traditional phone call. We are trying to add more chat ability to our service desk and then we can make a larger investment in our servers to support research. Incremental investments in new technologies should not be viewed as a zero-sum game to the overall IT expense. There needs to be an increase in IT expenses relative to other expenses in the healthcare system to take advantage of new technologies and replace legacy technologies, as well as expand capabilities in overall efficiencies without adding cost to the organization.

Q: How do you negotiate this with your executive team?

AR: That is the skill of the modern CIO. We have to navigate the challenge of promoting our ideas successfully and spending on technology to promote overall efficiencies and lower costs. Otherwise, we will be faced with cutting IT costs, and it becomes challenging to purchase new technologies to replace the old ones. My argument is that the modern CIO should expand tech and costs to advance the institution without adding overall costs, but it's not a zero-sum game.

Q: How do you measure return on investment for tech purchases? What benchmarks do you use?

AR: Benchmarks can help. We could benchmark ourselves against other institutions on what they spend for health IT, comparing traditional organizations to new ones. A brand-new technology implementation with a new firm could take up a large percentage of the IT expense. There are some projects that are core IT focused and others that are business needs with an IT component. Telehealth is a good example. Telehealth programs shouldn't be run by the CIO, but the CIO is instrumental in supporting the technology and networks.

Q: What challenges are you facing when deciding which IT to invest in?

AR: One of my challenges is how much IT should be centralized and how much should be distributed. At U of Michigan, we have so much innovation, and much of the innovation is occurring at the business level with a central core of IT. That's where we can try things out to see what works for a particular business unit. As things move to the cloud, the process becomes somewhat easier.

Q: From your perspective, what risks are worth taking when making new IT investments and partnerships? Are you concerned about the potential for data misuse when partnering with big tech companies?

AR: My view is I don't subscribe to the concern that these big tech companies will take over healthcare. They will be involved in it, and that will be a good thing since they know the marketplace of social interaction. It's kind of like gravity; don't fight it.

The issue then becomes which problems are they trying to solve. If you look at the partnership between Google and Ascension or Google and the University of Chicago, I think the press was unfair to both the health systems and big tech companies because they were trying to solve important problems. The issue of privacy is important, but in order for these health systems to provide better care, they need to join data and information from an unbelievably disparate organization. They aren't totally unified organizations like Kaiser Permanente; they have to work with big, innovative technology companies in order to solve the complex problem of unifying data across disparate systems.

Most patients are OK with health systems using their data to improve how we take care of them, based on surveys we've done. Patients say we can use their data and share it with others in the system if it will help other patients. But they don't want their data sold and used outside of the system. There is trust we have in healthcare with our patients' data.

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