As technology chief for Methodist Hospitals of Dallas, a $275-million network of medical centers in Texas, Pamela McNutt faces twin pressures of declining revenues and ever-higher expectations for medical safety. Add to that the daunting job of complying with the Health Insurance Portability and Accountability Act (HIPAA), a new set of federal rules for how health care companies use and protect patient data.
Q: The privacy part of HIPAA is due to become law in April 2003. Where are you in complying?
A: The biggest task that remains is the training of all employees—and I mean all employees. And doing business associate agreements. That’s a fairly burdensome task. You have to either redo the contracts or get an amendment to them specifically spelling out restrictions on their use of your data and their assurances that they will keep our data private. That has to be in every contract that we have that might deal with patient data.
Q: How many is that?
A: It’s 180 contracts we identified on first blush. We know in some areas there are even more and some perhaps don’t exist, such as for time and materials for repair of a biomedical device.
Q: Have there been any good byproducts of actually looking at all your contracts?
A: No, not really. There’s no plus side there other than we are able to populate our contracts database more thoroughly (laughs).
Q: What else are you dealing with? Enron is a hot topic in Texas.
A: Boards have suddenly taken a more acute interest in more details of operations since these scandals have people questioning whether the board was asleep at the wheel. You have to do more presentations to your board and present things in more depth. It’s changed how our whole organization presents our budget and gets approval. Some changes have been for the positive. But we are finding ourselves spending more time with the board than we have in the past. Especially when it comes to financials and how you’re projecting capital versus operating expenses. They have a more acute interest and maybe not such a rubber-stamp approach.
Q: Is that a big burden?
A: Well, they’re more interested in a five-year plan versus project-by-project. It’s a laborious process to look at a five-year window. But once you do that and everybody’s on board with it, then it frees you up more on the day-to-day work of doing projects that take you toward your five-year goals. But it’s a very tough industry right now. The dollars are thinner but the expectations are higher. Does the consumer really want the absolute best medical treatment [and] technology ensuring your safety? And what are you willing to pay for it? We want to be in perfect health and want someone else to pay for it.
