UIC SCHOOL OF PUBLIC HEALTH

1. UICSCHOOL OF PUBLIC HEALTH APRIL 21, 2010 CHICAGO, ILLINOIS OVERVIEW OF CHINA HEALTHCARE AND ITS USE OF INFORMATION TECHNOLOGY

2. TODAY’S PRESENTATION • DESCRIBE DORENFEST AND ITS BUSINESS IN CHINA • OVERVIEW OF HEALTHCARE IN CHINA • THE EVOLUTION OF H.I.T. AROUND THE WORLD AS A FRAME OF REFERENCE TO BETTER UNDERSTAND H.I.T. IN CHINA • THE CURRENT STATUS AND FUTURE DIRECTION OF H.I.T. IN CHINESE HOSPITALS • EVOLUTION OF RHNs IN THE U.S. AND CHINA • THE CITY OF SHENZHEN, AS AN EXAMPLE OF REGIONAL HEALTH NETWORKS IN CHINA • OPPORTUNITIES AND CHALLENGES FOR WESTERN COMPANIES IN CHINA H.I.T. • Q&A

3. THE DORENFEST GROUP • HEALTHCARE CONSULTING AND INVESTMENT FOCUS • OFFER HEALTHCARE IMPROVEMENT SERVICES TO SUPPORT A MORE POSITIVE WORLD FUTURE • HELP HEALTHCARE ORGANIZATIONS TO IMPROVE HEALTHCARE SERVICES WHILE REDUCING COSTS BY IMPROVING WORK PROCESSES, MANAGEMENT SYSTEMS, SERVICES TO PATIENTS, AND QUALITY OF MEDICAL CARE • IN 2006 THE DORENFEST GROUP FORMED THE DORENFEST CHINA HEALTHCARE GROUP, BASED IN SHANGHAI, TO BRING OUR SKILL, TECHNOLOGY, AND CAPITAL TO CHINA IN A TWO-PHASE PROGRAM • WE ARE NOW OPERATING IN PHASE 1 OF THIS PROGRAM, OFFERING A VARIETY OF CONSULTING, TRAINING, AND EDUCATION SERVICES TO THE CHINA HEALTHCARE SYSTEM • WE EXPECT TO ENTER PHASE 2 OF OUR ACTIVITIES IN CHINA IN LATE 2010 OR 2011 WHEN WE WILL BEGIN TO MAKE INVESTMENTS IN WELL-DEFINED, GOOD BUSINESS PROJECTS, IN PARTNERSHIP WITH CHINESE HEALTH BUREAUS AND HOSPITALS

4. DORENFEST 2005 INVESTIGATION OF HEALTHCARE IN CHINA • VISITED 17 CITIES IN CHINA • MET 100’S OF HEALTHCARE INDUSTRY LEADERS IN CHINA • VISITED OVER 100 HOSPITALS TO REVIEW HOSPITAL OPERATIONS AND DEFINE OPPORTUNITIES FOR IMPROVEMENT • MET PROVINCIAL AND CITY HEALTH BUREAU LEADERS IN CITIES VISITED • MET WITH MANY COMPANIES SELLING PRODUCTS AND SERVICES TO THE HEALTHCARE INDUSTRY IN CHINA • EVALUATED A GROUP OF HOSPITAL OWNERSHIP AND MANAGEMENT OPPORTUNITIES AND ASSESSED VIABILITY OF THE DORENFEST “MODEL HOSPITAL” IN CHINA • DEVELOPED A STRATEGY FOR BRINGING DORENFEST SKILL AND EXPERIENCE TO CHINA

5. DORENFEST CHINA PHASE 1 BUSINESS OPERATIONS • HOSPITAL AND HEALTH BUREAU MANAGEMENT CONSULTING • OPERATIONS IMPROVEMENT AND CHANGE MANAGEMENT • STRATEGIC PLANNING FOR NEW I.T. SYSTEMS • I.T. SYSTEM SELECTION • I.T. SYSTEM IMPLEMENTATION • WORK PROCESS IMPROVEMENT • MANAGEMENT TRAINING • INTERIM I.T. MANAGEMENT SERVICES • OTHER SERVICES • GENERAL MANAGEMENT CONSULTING FOR HEALTHCARE COMPANIES • CHINA ENTRY STRATEGIES • MARKET ANALYSES • PRODUCT STRATEGIES • MARKET RESEARCH • IMPLEMENTATION CONSULTING • EDUCATIONAL PROGRAMS FOR HOSPITAL AND HEALTHCARE BUREAU LEADERS

6. SOME RECENT CLIENT EXAMPLES IN CHINA • EXAMPLES OF HEALTH BUREAU CLIENTS • SHENZHEN • CHONGQING • EXAMPLES OF HOSPITAL CLIENTS • SHANGHAI CHANGNING MATERNITY AND INFANT HEALTH INSTITUTE • PEKING UNIVERSITY MEDICAL COLLEGE #3 HOSPITAL • RIZHAO CITY PEOPLE’S HOSPITAL • EXAMPLES OF HELPING CLIENTS FROM OTHER LOCATIONS TO BRING THEIR SKILLS TO MAINLAND CHINA • HONG KONG HOSPITAL AUTHORITY • MICROSOFT

7. DORENFEST EDUCATION IN CHINA – TONGREN HOSPITAL, BEIJING 2005

8. DORENFEST EDUCATION IN CHINA – ZHEJIANG MEDICAL ASSOCIATION 2009

9. UIC SCHOOL OF PUBLIC HEALTH OVERVIEW OF HEALTHCARE IN CHINA

10. BRIEF OVERVIEW OF THE DEVELOPMENT OF HEALTHCARE IN CHINA • IN THE CHANGE TO A MORE MARKET DRIVEN ECONOMY IN CHINA, THERE WAS A SHIFT FROM GOVERNMENT FUNDING OF THE HEALTHCARE SYSTEM TO CITIZEN FUNDING, WHICH HAS MADE CHINA THE HIGHEST “PATIENT PAY OUT OF THEIR POCKET” HEALTHCARE SYSTEM IN THE WORLD • CHINA’S HEALTHCARE COSTS IN TOTAL MAKE IT ONE OF THE MOST EFFICIENT HEALTHCARE SYSTEMS IN THE WORLD • CHINA’S OUTPATIENT CARE FOLLOWS A DIFFERENT MODEL THAN THE REST OF THE WORLD, WITH ALMOST ALL URBAN OUTPATIENT CARE IN THE COUNTRY IS NOW PROVIDED AS PART OF THE HOSPITAL SYSTEM AND LOCATED ON THE HOSPITAL CAMPUS • BECAUSE CHINA HAS BEEN AN EFFICIENT INVESTOR IN HEALTHCARE,THE FACILITIES HAVE NOT KEPT UP WITH THE NEEDS OF THE COUNTRY, AND MOST OUTPATIENT CARE HAS BEEN OFFERED IN VERY CROWDED SETTINGS • WITH THE DEVELOPMENT OF CHINA, THIS IS CHANGING. THE PEKING UNIVERSITY THIRD HOSPITAL NEW OUTPATIENT BUILDING IS PART OF A TREND THAT OTHER HOSPITALS IN CHINA ARE FOLLOWING, AS SOME OF THE BEST CLASS 3 HOSPITALS IN CHINA WITH HIGH OUTPATIENT VOLUMES HAVE BUILT OR ARE BUILDING NEW FACILITIES

11. BRIEF OVERVIEW OF THE DEVELOPMENT OF HEALTHCARE IN CHINA(CONTINUED) • CHINESE OUTPATIENT CARE IS CHARACTERIZED BY THE FOLLOWING: • EXTREMELY HIGH OUTPATIENT VOLUMES COMPARED TO OUTPATIENT VOLUMES IN HOSPITAL SETTINGS IN OTHER COUNTRIES • LONG WAIT TIMES FOR OUTPATIENT CARE • THE VAST MAJORITY OF PATIENTS ARE SEEN ON A WALK-IN OR “SAME DAY” BASIS. WHEN RESERVATIONS SYSTEMS ARE USED, IT IS IN A VERY LIMITED MANNER • A VERY LIMITED TIME DURING THE OUTPATIENT VISIT IS BUDGETED FOR THE PATIENT TO SPEND TIME WITH THE PHYSICIAN • THE COLLECTION OF MONEY FROM THE PATIENT FOR EACH ACTIVITY PERFORMED IS A CRITICAL ELEMENT OF THE OUTPATIENT WORK PROCESS AND ADDS TO THE LONG WAIT TIMES IN OUTPATIENT SETTINGS IN CHINA • CUSTOMER SERVICE IS A LOW PRIORITY

12. HEALTHCARE REFORM IN CHINA IS BRINGING MANY CHANGES TO THE HEALTHCARE SITUATION • THE POOR PEOPLE WILL NOW BE GETTING BASIC HEALTHCARE WITH GOVERNMENT ASSISTANCE, WHICH SHOULD RAISE THE LEVEL OF HEALTHCARE IN CHINA • CHINA IS PROVIDING LARGE STIMULUS SPENDING TO IMPROVE HEALTHCARE • THE STIMULUS SPENDING IS FUELING MAJOR CHANGES IN THE HEALTHCARE SYSTEM IN CHINA • SOME CHANGES INCLUDE THE FOLLOWING: • THE DEVELOPMENT OF COMMUNITY CLINICS TO EASE THE OUTPATIENT LOAD IN CLASS 3 HOSPITALS • THE MODERNIZING OF FACILITIES IN CHINA TO CREATE A BETTER PATIENT EXPERIENCE IN THE OUTPATIENT SETTING • ENCOURAGEMENT OF ADVANCE APPOINTMENT SYSTEMS IN THE OUTPATIENT AREA • A VARIETY OF OTHER PUBIC HOSPITAL REFORMS • ALL OF THESE ACTIVITIES AND MANY MORE ARE BEING SUPPORTED BY THE STIMULUS FUNDING BEING MADE AVAILABLE FOR NEW FACILITIES AND BETTER CUSTOMER SERVICE • THE CHALLENGE FOR CHINA WILL BE TO DIGEST THESE CHANGES IN A SHORT PERIOD OF TIME TO ACCOMPLISH THE DESIRED OUTCOMES

13. CHINA HEALTHCARE EXPENDITURES WILL GROW RAPIDLY($ AND RMB IN BILLIONS) 15.2% 14.1% 13.6% 14.6% 866 RMB ($126.7 ) 984 RMB ($144.0 ) 1128 RMB ($165.0) 759 RMB ($97.0) 1900 RMB ($275.0) 13.8% 659 RMB($84.9 ) 459 RMB ($59.1) 579 RMB ($74.7) 216 RMB ($27.8) 75 RMB ($9.6) Annual Growth Rate Forecasted Growth Rate – 15% in 2008 and 20% in 2009 and 2010 RMB in Billions Government Social Insurance Out-of-pocket SOURCE: MINISTRY OF HEALTH ANNUAL STATISTICS YEARBOOK

14. Drug Exam/Test Medical Services AVERAGE MEDICAL EXPENSE PER OUTPATIENT HOSPITAL VISIT ($ AND RMB) RMB 136 RMB ($19.9) 129 RMB($18.8) 127 RMB($18.6) 118 RMB($17.3) 86 RMB ($12.6) 40 RMB ($5.8 ) SOURCE: MINISTRY OF HEALTH ANNUAL STATISTICS YEARBOOK

15. OUTPATIENT REGISTRATION AT THE OLD OUTPATIENT BUILDING IS AN EXAMPLE OF THE OLD METHOD OF OUTPATIENT CARE IN CHINA

16. ANOTHER EXAMPLE IS THE REGISTRATION PAYMENT FOR CLINIC VISITS AT PEKING UNIVERSITY THIRD HOSPITAL

17. THE OUTPATIENT HEALTH RECORD WHICH PATIENT KEEPS

18. CUSTOMER SERVICE IS A LOWER PRIORITY • LONG WAIT TIMES • VERY FEW ADVANCE APPOINTMENT SYSTEMS • AVERAGE TIME OF PHYSICIAN VISIT IS 2-5 MINUTES • COLLECTING MONEY AND MAKING PROFITS ARE A MAJOR FOCUS

19. Drug Exam/Test Medical Services AVERAGE MEDICAL EXPENSE PER INPATIENT HOSPITAL STAY ($ AND RMB) RMB 4974 RMB($728.3) 4662 RMB($682.2) 4669 RMB($683.3) 4285 RMB($627.1) 3084 RMB($451.3) 1668 RMB($244.1) SOURCE: MINISTRY OF HEALTH ANNUAL STATISTICS YEARBOOK

20. ALMOST 60% OF HEALTHCARE COSTS ARE PAID DIRECTLY BY PATIENTS OUT OF THEIR POCKET ACCESS TO HEALTHCARE FOR THE POOR HAS BEEN LIMITED, BUT NOW CHANGING THE MIDDLE AND UPPER CLASSES ARE DISSATISFIED WITH HEALTHCARE SERVICES DOCTOR INCOME EARNING METHODS WEAKEN THE DOCTOR-PATIENT RELATIONSHIP DRUGS AND TESTS FUND TOO MUCH OF THE HEALTHCARE SYSTEM HOSPITALS NEED TO EARN PROFITS TO SUPPORT THEMSELVES PRIMARY CARE IS JUST BEGINNING TO SEPARATE FROM HOSPITALS TO NEWLY-DEVELOPED COMMUNITY CLINICS HEALTHCARE SYSTEM CHANGES WILL CAUSE HEALTHCARE COSTS TO RISE MORE RAPIDLY CHALLENGES OF THE CHINESE HEALTHCARE SYSTEM

21. UIC SCHOOL OF PUBLIC HEALTH THE EVOLUTION OF H.I.T. AROUND THE WORLD AS A FRAME OF REFERENCE TO BETTER UNDERSTAND H.I.T. IN CHINA

22. U.S. HEALTHCARE COSTS AS A PERCENT OF GDP ($ IN BILLIONS) 20.0% $4,043.6 20% GDP 1970- 2004 (not ‘75) $ 75.1 245.8 426.8 696.0 990.3 1,299.5 1,877.6 $1,987.7 15% $990.3 $1,299.5 $696.0 $426.8 10% $245.8 $75.1 5% 0% 1970 1975 1980 1985 1990 1995 2000 2005 2015 CMS Forecast SOURCE: CENTERS FOR MEDICARE AND MEDICAID SERVICES

23. GROWTH OF H.I.T. SPENDING IN U.S.($ IN BILLIONS) $ in billions $30.5 $28.0 $25.8 $23.6 $21.6 $20.0 $19.0 $18.5 $16.0 $13.6 $11.6 $10.0 $8.5 $7.5 Actual Forecast 2006 ANNUAL GROWTH RATE: 6.7% 13.3% 17.6% 16.0% 17.2% 17.6% 15.6% 2.7% 5.2% 8.0% 9.3% 9.3% 8.9% 8.9% SOURCE: SHELDON I. DORENFEST & ASSOCIATES, LTD.

24. OPPORTUNITIES TO IMPROVE THE HEALTHCARE DELIVERY PROCESSHAVE BEEN PURSUED FOR MANY YEARS • GREAT REDUNDANCY OF INFORMATION • HIGH ERROR POTENTIAL • LACK OF TIMELINESS • HIGH COST • ORGANIZATION COMPLEXITY

25. U.S. HOSPITALS STARTED USING H.I.T. IN THE 1960s AND SOUGHT AN EHR THROUGH FOUR GENERATIONS OF I.T. SYSTEMS • FINANCE SYSTEMS (LATE 1960S-1970s) • LIMITED CLINICAL SYSTEMS (LATE 1970s AND 1980s) • MORE ADVANCED CLINICAL SYSTEMS (1990s) • ELECTRONIC HEALTH RECORDS (2000s)

26. BUT POORLY IMPLEMENTED CHANGE LAYERED REDUNDANT WORK ON TOP OF ORIGINAL INEFFICIENCY GROWTH IN REDUNDANCY 4x Legacy I.T. Systems Manual New Thrusts of the 2000's 3x NOW 1990's Systems and Surrounding Integration 2x BEFORE I.T.=1x TOTAL HOSPITAL WORK PROCESS

27. U.S. HAS MADE MORE PROGRESS RECENTLY • TODAY OVER 100 HOSPITALS HAVE IMPLEMENTED CPR WITH CPOE • MANY OTHERS ARE IMPLEMENTING CPR AND CPOE RIGHT NOW • I.T. IS A MAJOR TOOL FOR IMPROVING HOSPITAL PERFORMANCE

28. BUT U.S. HOSPITALS HAVE BEEN INEFFICIENT INVESTORS • OVERSIMPLIFICATION OF I.T. INVESTMENT CONSIDERATIONS (I.E., DID NOT KNOW WHAT THEY DID NOT KNOW) • POOR PROJECT PLANNING • IMPROPER ASSESSMENT OF SOFTWARE PRODUCT CAPABILITIES • IMPLEMENTED A SERIES OF “1/2 SYSTEMS” WITHOUT PROPERLY REDESIGNING THE WORK PROCESS • INDUSTRY MANAGEMENT DID NOT LEARN ENOUGH FROM PAST MISTAKES, AND THEREFORE, CONTINUED TO REPEAT THE SAME MISTAKES • THIS LEFT THE NATION WITH REDUNDANT, CONVOLUTED, EXPENSIVE, ERROR PRONE WORK PROCESSES THAT PRESENTLY CRIPPLE THE COUNTRY’S HEALTHCARE SYSTEM

29. H.I.T. EVOLUTION IN THE REST OF THE WORLD • CANADA STARTED IN THE LATE 1970s • EUROPE AND AUSTRALIA BEGAN IN THE EARLY 1980s • ASIA BEGAN IN THE 1990s • CANADA, FRANCE, GERMANY, ENGLAND, AND AUSTRALIA ALL STARTED LATER THAN THE U.S., INVESTED LESS, AND HAVE MADE MORE PROGRESS • HONG KONG STARTED EVEN LATER, INVESTED EVEN LESS, AND IS NOW AT THE STATE OF THE ART IN H.I.T. • CHINA H.I.T. IS NOW AT AN EARLIER STAGE OF DEVELOPMENT. CHINA HAS THE GOALS AND DESIRE TO “LEAPFROG” THE REST OF THE WORLD IN H.I.T. USE IN THE NEXT FEW YEARS

30. SUMMARY • U.S. SPENDS A MUCH LARGER SHARE OF GDP ON HEALTHCARE, BUT, THIS GREATER EXPENDITURE DOES NOT PRODUCE GREATER HEALTHCARE RESULTS • U.S. SPENDS A LARGER SHARE OF ITS TOTAL HOSPITAL OPERATING COSTS ON I.T. EFFORTS • U.S. HAS BEEN INVESTING HEAVILY IN H.I.T. FOR OVER 40 YEARS. WHILE THIS SUBSTANTIAL INVESTMENT HAS NOT PRODUCED ADEQUATE RETURN, THERE IS MUCH TO LEARN FROM WHAT WORKED AND DID NOT WORK IN U.S. H.I.T. STRATEGIES AND APPROACHES • U.S. HAS BEEN THROUGH AT LEAST FOUR GENERATIONS OF HOSPITAL SOFTWARE PRODUCTS IN THE PAST FORTY YEARS • THE REST OF THE WORLD STARTED AUTOMATION EFFORTS LATER, INVESTED LESS, AND HAVE RECEIVED A HIGHER RETURN ON H.I.T. INVESTMENT THAN THE U.S. • THERE IS STILL MUCH TO DO TO IMPROVE H.I.T. ROI EVERYWHERE IN THE WORLD

31. UIC SCHOOL OF PUBLIC HEALTH THE CURRENT STATUS AND FUTURE DIRECTION OF H.I.T. IN CHINESE HOSPITALS

32. EVOLUTION OF H.I.T. IN CHINA • CHINA BEGAN TO COMPUTERIZE ITS HOSPITALS IN THE EARLY 90’S • INITIALLY PROGRESS WAS SLOW, WITH A FOCUS ON FINANCIAL SYSTEMS • IN THE EARLY 2000’S, CHINESE HOSPITALS BEGAN TO IMPLEMENT I.T. FOR CLINICAL SYSTEMS • MANY SOFTWARE SOLUTIONS AVAILABLE, WITH SEVERAL HUNDRED SMALLER SOFTWARE COMPANIES EMERGING • IN 2005, CHINA SPENT LESS THAN 1% OF TOTAL HEALTHCARE COSTS ON I.T. OR ABOUT $600 MILLION (USD) • IN 2007, CHINA SPENT OVER $1 BILLION (USD) ON H.I.T. • GROWTH IN H.I.T. INVESTMENT IS EXPECTED TO ACCELERATE, RISING TO ALMOST $3 BILLION USD IN 2010

33. CHINA HOSPITAL WORK PROCESSES ARE REDUNDANT, EXPENSIVE, AND ERROR-PRONE THE MINISTRY OF HEALTH (MOH) GUIDELINES FOR HEALTH I.T. DEVELOPMENT CALL FOR ALL CITIES IN CHINA TO HAVE REGIONAL HEALTH NETWORKS AND ELECTRONIC MEDICAL RECORDS AUTOMATED BETWEEN 2003 AND 2010 PROVIDED MUCH MOMENTUM NOT MUCH SUCCESS TO DATE HEALTHCARE REFORM INCREASED INVESTMENT AND MOMENTUM CHINESE HOSPITAL LEADERS WANT TO TAKE A BIG LEAP FORWARD IN IMPROVING WORK PROCESSES AND IN DIGITIZING CHINESE HOSPITALS IMPROVED USE OF I.T. IS ONE OF 8 PILLARS OF THE NEW CHINA HEALTHCARE REFORM PLAN. FOCUSES INCLUDE: ELECTRONIC HEALTH RECORDS DATA SHARING THROUGH REGIONAL HEALTH NETWORKS IMPROVED HOSPITAL I.T. SYSTEMS I.T. SYSTEMS TO SUPPORT HEALTH INSURANCE FACTORS CONTRIBUTING TO FUTURE SPENDING GROWTH IN CHINA H.I.T.

34. FACTORS IMPEDING SUCCESS IN CHINA H.I.T. • CHINESE HOSPITALS HAVE INVESTED TOO LITTLE IN I.T. SYSTEMS AND I.T. INFRASTRUCTURE • SOFTWARE PRODUCTS AND INTEGRATION TOOLS ARE NOT GOOD ENOUGH • INEXPERIENCE IN SOFTWARE BUYING RESULTS IN BAD BUYING DECISIONS AND POOR IMPLEMENTATION • THIS HAS RESULTED IN NEW I.T. SYSTEMS, OFTEN ADDING WORK AND CREATING UNNECESSARILY REDUNDANT WORK PROCESSES • HOSPITAL LEADERS, NOT KNOWING WHAT THEY DO NOT KNOW, CONTINUE TO USE POOR BUYING AND IMPLEMENTATION APPROACHES BECAUSE THEY DO NOT KNOW BETTER WAYS ARE POSSIBLE, AND THERE IS A STRONG MOMENTUM TO CONTINUE WITH THESE APPROACHES

35. THE COMPETITIVE ENVIRONMENT • THERE ARE HUNDREDS OF SMALL SOFTWARE VENDORS ACTIVE IN CHINA H.I.T. • THE MARKET SEGMENTS WITH THE MOST VENDORS ARE EMR, H.I.S., PACS, R.I.S., AND LAB • ALL H.I.T. VENDORS IN THE MARKET STARTED IN A CITY AND MOST ARE STILL OPERATING IN THAT CITY OR A SMALL REGION AROUND THE CITY. SOME H.I.T. VENDORS ARE BEGINNING TO BECOME MORE NATIONAL IN SCOPE • MANY VENDORS IN THE H.I.S. MARKET OFFER HEAVILY CUSTOMIZED SOLUTIONS RATHER THAN STANDARD SOLUTIONS. THESE CUSTOMIZED SOLUTIONS CREATE GREATER DEPENDENCY ON THE VENDOR AND ARE MORE DIFFICULT/EXPENSIVE TO KEEP CURRENT AS VENDORS PERIODICALLY RELEASE UPDATES • CHINESE HOSPITAL LEADERS WOULD LIKE TO SEE A NEW GENERATION OF H.I.T. SOFTWARE DEVELOPED FOR THE COUNTRY TO ASSIST IN HELPING THEM ACCOMPLISH THEIR “LEAPFROG” OBJECTIVES

36. ALLOCATION OF H.I.T. INVESTMENT AROUND THE WORLD SOURCE: CCW Research

37. EXPECTED EVOLUTION OF H.I.T. IN CHINA • IMPROVED BUYING AND IMPLEMENTATION OF I.T. SOFTWARE WITH MORE USER INVOLVEMENT • BETTER USE OF I.T. TO SUPPORT HOSPITAL MANAGEMENT • BETTER USE OF I.T. IN CLINICAL SERVICES • DIGITAL HOSPITALS WITH ELECTRONIC HEALTH RECORDS WILL EVOLVE WITH GREATER FREQUENCY • BETTER SYSTEMS INTEGRATION AND MORE STANDARDS TO SUPPORT I.T. PROGRESS AND THE USE OF MULTIPLE VENDORS IN THE I.T. ENVIRONMENT • REGIONAL HEALTH NETWORKS WILL EVOLVE • CHINA’S GOAL IS TO LEAPFROG THE WORLD IN H.I.T. ACCOMPLISHMENT

38. CHINA HEALTHCARE LEADERS WANT TO “LEAPFROG” THE WORLD • CHINESE HOSPITALS AND HEALTH BUREAUS ARE CAREFULLY CONSIDERING HOW TO BE MORE SUCCESSFUL IN TAKING NEXT STEPS FORWARD IN I.T. USE • THERE IS A RECOGNITION THAT FOR CHINA TO ACCOMPLISH ITS OBJECTIVES IN H.I.T. REQUIRES THE FOLLOWING : • LEARNING QUICKLY FROM THE GLOBAL EXPERIENCE • OVERCOMING RESISTANCE TO CHANGE • KNOWING HOW TO MANAGE CHANGE • DOING MORE OF WHAT THE REST OF THE WORLD DID RIGHT AND LESS OF WHAT THEY DID WRONG TO AVOID MISTAKES OTHER COUNTRIES HAVE MADE AND CHINA IS STILL MAKING • DEVELOPING MORE EXPERTISE IN THESE AREAS OF NEED

39. UIC SCHOOL OF PUBLIC HEALTH EVOLUTION OF RHNs IN THE U.S. AND CHINA

40. RHNs WERE FIRST INTRODUCED AS CHINS IN THE U.S. IN THE EARLY 1990s Hospital B Nursing Home Doctor’s Office Patient Data Outpatient Clinic Outpatient Clinic GovernmentReimbursement Insurance Payor Doctor’s Office Doctor’s Office Hospital A Home Health Agency Blood Bank Outpatient Clinic

41. SUMMARY OF EVOLUTION OF RHNs IN THE U.S. COMMUNITY HEALTH INFORMATION NETWORKS (CHINs) BEGAN IN 1990 AS THE FIRST GENERATION OF RHNs IN THE UNITED STATES FORMED WITH A BROAD VISION OF SHARING INFORMATION AMONG HEALTH ORGANIZATIONS WITHIN A CITY OR STATE UNCLEAR OBJECTIVES LACK OF VALUE TO POTENTIAL PARTICIPANTS MUCH MONEY INVESTED BY MANY CHIN PROJECTS INTEGRATED DELIVERY OWNERSHIP MODELS EMERGED IN 1993 AS THE HOSPITAL ANSWER TO THE CLINTON HEALTHCARE REFORM PROPOSAL BY THE MIDDLE 1990s, INTEGRATED DELIVERY SYSTEMS EMERGED IN EVERY CITY IN THE UNITED STATES, AND THE CHIN CONCEPT DISAPPEARED BY 1996

42. THE VISION OF INTEGRATED DELIVERY SYSTEM OWNERSHIP MODELS Hospital B Nursing Home Doctor’s Office Patient Data Outpatient Clinic Outpatient Clinic GovernmentReimbursement Insurance Payor Doctor’s Office Doctor’s Office Hospital A Home Health Agency Blood Bank Outpatient Clinic

43. RHIOs EMERGE IN THE DECADE OF THE 2000s RHIOs WERE THE SECOND GENERATION OF RHNs IN THE U.S. MANY DIFFERENT ORGANIZATIONS PROMOTED THEM IN THE EARLY 2000s BY 2004, NATIONAL POLICY EMERGED THROUGH THE OFFICE OF THE NATIONAL COORDINATOR FOR HEALTH INFORMATION TECHNOLOGY (ONCHIT) IN THE ENSUING SEVERAL YEARS BETWEEN 2004 AND NOW, ALMOST 100 OFFICIALLY DESIGNATED RHIOs EMERGED HEAVY INVESTMENT IN THESE RHIOs WITH MOST FUNDS USED IN THEIR START-UP MANY WERE UNABLE TO FIND A SUSTAINABLE OPERATING MODEL AND APPROACHED FINANCIAL COLLAPSE SOME LONG TERM SUCCESSES EMERGED TO SHARE LIMITED DATA

44. WHAT ARE THE LESSONS TO BE LEARNED? BROAD VISIONS NEEDS DETAILED PLANS OVERSIMPLIFIED IMPLEMENTATION APPROACHES CREATE FLAWED AND LIMITED SUCCESS LACK OF STAKEHOLDER COMMITMENT CREATED FAILED PROGRAMS HEAVY INVESTMENT IN POORLY CONCEIVED IDEAS WASTED MONEY SUCCESS ACCOMPLISHED THROUGH LIMITED, WELL THOUGHT THROUGH FIRST STEPS AND STRONG STAKEHOLDER PARTICIPATION AND SUPPORT

45. EVOLUTION OF RHNs IN CHINA THE MINISTRY OF HEALTH (MOH) GUIDELINES FOR HEALTH I.T. DEVELOPMENT CALLED FOR REGIONAL HEALTH NETWORKS AND DIGITAL HOSPITALS TO BE IMPLEMENTED THROUGHOUT CHINA BETWEEN 2003 AND 2010 THIS PROVIDED MUCH MOMENTUM AS MANY HEALTH BUREAUS UNDERTOOK REGIONAL HEALTH NETWORK AND DIGITAL HOSPITAL INVESTMENT IN THE LAST FEW YEARS DATA SHARING HAS BEGUN TO EMERGE IN CHINA AS SOME RHNs SHARE LIMITED DATA SUCH AS TEST/DIAGNOSTIC RESULTS AND SOME PATIENT INFORMATION HEALTHCARE REFORM CALLS FOR E-HEALTH RECORDS AND HAS PROVIDED SUBSTANTIAL ADDITIONAL FUNDING IN A VARIETY OF WAYS, SO IT IS EXPECTED THAT SUBSTANTIAL ADDITIONAL PROGRESS WILL BE MADE IN THE NEXT FEW YEARS MUCH MORE ACTIVITY AND FUNDING IN MANY CITIES AND PROVINCES WITH EVEN U.S. FUNDING FOR ONE OR TWO MAJOR PLANNING PROJECTS

46. THE CURRENT SITUATION WITH RHN DEVELOPMENT AND ELECTRONIC HEALTH RECORDS IN CHINA RESEMBLES THE U.S. SITUATION OF PAST BROAD VISION MORE MONEY AVAILABLE POOR DEFINITION OF FIRST STEPS LACK OF STAKEHOLDER COMMITMENT TO SPECIFIC DATA SHARING

47. BUILDING SUCCESS THROUGH A STRONG FOUNDATION CAREFULLY DEFINE FIRST STEPS LIMITED DATA SETS WITH HIGH BENEFIT TO MANY STAKE HOLDERS WOULD BE ADVANTAGEOUS WHEN FIRST STEPS PROVE BENEFICIAL, MORE AGGRESSIVE SECOND STEPS CAN BE TAKEN

48. UIC SCHOOL OF PUBLIC HEALTH THE CITY OF SHENZHEN AS AN EXAMPLE OF REGIONAL HEALTH NETWORKS IN CHINA

49. SHENZHEN REGIONAL HEALTH NETWORK VISION • SHENZHEN, A CITY OF 12 MILLION PEOPLE, SELECTED BY MINISTRY OF HEALTH IN 2004 TO BE A PILOT SITE IN DEVELOPING REGIONAL HEALTH INFORMATION NETWORKS AND DIGITAL HOSPITALS • THE GOALS OF THE RHN ARE TO ACCOMPLISH THE FOLLOWING:: • PROVIDING BETTER TOOLS AND INFORMATION TO IMPROVE HEALTH MANAGEMENT IN THE CITY • SHARING HEALTH INFORMATION THROUGHOUT THE CITY • REDUCING “ISLANDS OF INFORMATION” THROUGHOUT THE CITY • PROMOTING AND ADOPTING TECHNOLOGY STANDARDS THAT WILL FACILITATE INTEROPERABILITY OF HEALTH INFORMATION • THE PLAN IS TO DEVELOP AN INFORMATION NETWORK THAT CAN BE ACCESSED AND USED BY HEALTHCARE PROVIDERS THROUGHOUT THE CITY OF SHENZHEN

50. SHENZHEN REGIONAL HEALTH NETWORK VISION (CONTINUED) • THE RHN WILL CONSIST OF “ONE CENTER, THREE PLATFORMS, AND NINE SYSTEMS” • ONE CENTER REFERS TO SHENZHEN HEALTHCARE DATA CENTER • THREE PLATFORMS REFERS TO: • DATA SHARING AND EXCHANGE PLATFORM • HEALTHCARE MACRO MANAGEMENT AND DECISION-MAKING SUPPORT PLATFORM • HEALTHCARE I.T. PUBLICATION AND VALUE-ADDED SERVICE PLATFORM • NINE SYSTEMS REFERS TO THE I.T. SYSTEMS FOR THE FOLLOWING : • HOSPITAL OPERATIONS • PUBLIC HEALTH EMERGENCY RESPONSE • DISEASE PREVENTION AND CONTROL • HEALTHCARE SUPERVISION AND LAW ENFORCEMENT • EMERGENCY CARE • MATERNAL AND CHILD HEALTH • COMMUNITY HEALTHCARE • HEALTH EDUCATION • OTHER SYSTEMS FOR HEALTHCARE OPERATIONS