My name is Pamela Pure, and I am the Executive Vice President of McKesson Corporation and President of McKesson Provider Technologies, the company’s health information technology business. I thank Chairman Ensign, Ranking Member Kerry, and the members of the subcommittee for the opportunity to submit testimony on behalf of McKesson. McKesson strongly supports the goal of improving healthcare quality by using healthcare information technology (IT) to reduce medical errors and lower costs.

For more than 170 years, McKesson has led the industry in the wholesale delivery of medicines and healthcare products. Today a Fortune 15 corporation, McKesson delivers vital pharmaceuticals, medical supplies, and healthcare IT solutions that touch the lives of more than 100 million patients each day in every healthcare setting. As the world’s largest healthcare services company with a customer base that includes more than 200,000 physicians, 25,000 retail pharmacies, 5,000 hospitals and 600 payers, McKesson is well positioned to help transform the healthcare system.

As the largest provider of automation and information technology in the healthcare industry, we deliver innovative technologies at each point in the healthcare system to reduce medication errors, lower costs, and improve the quality and efficiency of healthcare. We are dedicated to making healthcare safer, a goal that requires a deep understanding of healthcare delivery processes and a clear focus on what is required by key stakeholders such as physicians, nurses, pharmacists and patients. My colleagues and peers know that for me this is not a job; it is a passion. After 20 years of advocating the use of technology and witnessing firsthand the benefits and challenges associated with its implementation, I am delighted to have this opportunity to share my insights with the Congress.

McKesson fully supports the President’s goal that every American should have an electronic health record (EHR) in 10 years. To meet this bold vision, McKesson believes that the federal government should pursue a two-pronged strategy to spur the adoption of automation and healthcare IT. First, we need broad deployment today of high-impact technologies that provide unquestionable benefits in the delivery of healthcare. Second, on a parallel track, we need to develop the standards and promote the interoperability of systems that are essential for medical information to be shared among healthcare providers, patients, and public health agencies in a safe, secure manner.

At McKesson, we know that technology itself is not the inhibitor of change in the healthcare system. The technology is available and working. It is intolerable that people die every day from medication errors that could be prevented with bar-code technology, the same technology that is used in every major retail outlet in this country. We conduct sophisticated banking and other business transactions electronically across continents; yet most physicians in the United States still rely on their memories for complex medical information, and write orders using pen and paper.

While deployment of healthcare IT is growing, less than 20 percent of hospitals in the United States today use bar-codes to verify the administration of patient medications, and fewer than 10 percent of physicians in hospitals enter patient prescriptions and medical orders electronically. The numbers are only slightly better outside the hospital: only about 25 percent of large physician offices enter their prescriptions electronically. The number drops considerably for small physician practices.

Three Areas Where High-value, High-impact Technologies Already Make a Difference

We can and must make the healthcare system safer and more efficient by accelerating the use of technology in all hospitals and physicians’ offices in the United States. There are three areas where high-value, high-impact technologies already make a significant difference:

1. Bar-code technology. Medications should be packaged in unit-doses labeled with bar codes and scanned at the bedside before they are given to patients. Today, on average, there are 27 steps in the medication use process that involve many decisions, multiple handoffs and various people, ranging from the physician who prescribes the order to the pharmacy staff to the nurse who ultimately administers the medication to the patient. Healthcare IT and automation can reduce the handoffs and eliminate, on average, 40 percent of the steps with dramatically improved accuracy, efficiency and safety. In a group of 75 hospitals that use McKesson’s bedside bar-coding technology, 400,000 “alerts” are triggered weekly to nurses or other healthcare professionals to advise them that the wrong medication or incorrect dosage is about to be administered. As a result of these on-line warnings, we estimate that these hospitals prevent 56,000 errors each week; a staggering statistic! Hospitals that deploy bar-code scanning technology report dramatic error reduction in medication administration, as high as 90 percent.

2. Electronic prescriptions. We must eliminate paper prescriptions. Each year more than three million preventable adverse drug events occur in physicians’ offices or other out-patient care settings. Imagine a world where a patient’s list of current medications is available to the physician and the physician can order initial scripts or refill them online. All the medication names would be legible, and all orders checked for drug-drug interactions and allergies. Today, McKesson’s systems help to ensure safe prescriptions are written and filled 100,000 times each month, but, nationwide, 80 percent of prescriptions are still on paper, and many are illegible.

3. Secure Web-based access to patient information. We must equip physicians and clinicians with the information needed to make informed decisions about patient care. Today, most healthcare is delivered in a paper-based world. It is not uncommon for physicians to provide patients with advice, give directions to other staff and recommend treatment changes without any access to a patient’s chart. These blind encounters happen every day. Secure Web-based access to clinical patient information, such as laboratory results, the patient’s medical record and diagnostic images, enables physicians to find, within seconds, the information they need to make more informed decisions and initiate or adjust treatment. McKesson currently records 1.8 million logins each month to its Web-based physician portal, almost double compared to a year ago. Remote access via Web portal technology is in common use across many industries; yet, in healthcare, its deployment is only in the 50 – 60 percent range.

Funding to support these focused initiatives can lead to dramatic progress very quickly. McKesson applauds the leadership shown and initiatives undertaken by the Congress and this Administration. Implementing these three forms of technology will build the required momentum and provider support for adoption of healthcare IT.

Technology is Improving Healthcare Quality Today Healthcare technologies today save lives, reduce medical errors, improve the quality of care, and reduce overall health costs. The following healthcare organizations are just a few of our customers that have taken these important first steps to improve care for their patients:

Concord Hospital, an affiliate of Capital Region Health Care (CRHC), Concord, NH: Concord was one of the first hospitals in the United States to introduce bedside bar-code scanning of medications in 1994, which reduced its already low medication error rate by 80 percent. This reduced error rate, which has been sustained for more than 10 years, has improved productivity and efficiency as well as increased clinician satisfaction and retention.

Medical Associates Clinic, Dubuque, IA: Medical Associates is deploying an ambulatory electronic health record and e-prescribing system for more than 100 physicians and medical providers, which represent 30 specialties dispersed across 16 locations in three states. With the implementation still underway, physicians are already entering 26,000 e-prescriptions each month, and patient information is available electronically regardless of location. Nurses spend far less time on medication management; they have reduced the time spent on paper charting activities by 24 percent and they spend 16 percent more time with patients and their families. In addition to improved quality and better decision-making, this clinic projects an annualized net gain of $1.7 million with full system deployment.

Regional West Medical Center, Scottsbluff, NE: A regional referral center covering more than 12,000 square miles in rural Nebraska, Regional West has used information technology to streamline the delivery of healthcare. Through secure Internet access, physicians and other clinicians can view a single electronic medical record for each patient, which includes diagnostic medical images, pharmacy data and laboratory results. A McKesson pharmacy robot dispenses bar-coded, unit-dose medication packets virtually error-free. Electronic patient charting at the bedside has cut nurses’ daily paperwork by nearly 1.5 hours, enabling them to spend more time caring for patients. The hospital has reduced its medication error rate by 30 percent to less than one percent. Before giving a medication, the nurse must capture a three-way bar-code match between his/her badge, the medication and the patient’s wristband to check the five “rights”: the right patient is receiving the right dose of the right medication at the right time via the right route.

Mary Lanning Memorial Hospital, Hastings, NE: The largest employer in Hastings, Nebraska, Mary Lanning Memorial Hospital has served the healthcare needs of the surrounding community for the past 83 years. Although the hospital’s medication error rate was low, a single tragic event highlighted the need for standardized medication administration. Bedside bar-code scanning technology was implemented along with a pharmacy information system to reduce the risk of medication errors. Additionally, medications scanned at the bedside are compared to orders reviewed by pharmacists and screened for allergies, interactions and therapeutic duplications. Preliminary data has shown a 35 percent increase in the reporting of near-miss events related to wrong drug and wrong patient.

Presbyterian Healthcare Services in Albuquerque, NM: Using McKesson’s bar-code technology solutions, Presbyterian reduced medication administration errors by 80 percent. Technology has also allowed pharmacists to be redeployed to critical care units to work directly with patients and physicians and enhance the quality of care.

These innovative health systems and others across the country are saving lives and saving money. Physicians, nurses, and pharmacists now spend more time interacting with patients and less time performing administrative functions. More importantly, these organizations are creating a new baseline for patient care in the United States. While making healthcare safer through seamless, rapid and accurate information flow, they are also addressing one-third of healthcare’s overall costs: administrative paperwork, clinical errors, manual hand-offs and rework.

Developing Standards and Promoting Interoperability McKesson fully supports efforts of Congress and the Administration to facilitate standards harmonization, encourage the formation of regional health information organizations and establish a National Health Information Network. Development of the requisite technology standards will allow the computer systems of doctors, hospitals, laboratories, pharmacists and payers to efficiently communicate and share information. We are honored to work with Dr. David Brailer and the Office of the National Coordinator for Health Information Technology as he moves to create a foundation for the transformation of our healthcare system. We are also pleased to be a member of the Commission for the Certification of Health Information Technology, a collaborative public-private partnership to develop standards and certify health information technology systems.

We all remember the incremental steps that were taken by other industries as they moved towards connectivity and interoperability. First, they automated individually and then, collectively, they collaborated to connect the information. Consider the banking industry. A full decade elapsed between the early proliferation of bank-specific automatic teller machines (ATM) and the formation of “shared ATM networks” in the 1980s. Once the automation was complete, connectivity and interoperability occurred very quickly. In the interim, banks were able to realize the cost and efficiency savings of ATMs, and consumers, appreciating the convenience of ATMs, quickly adapted to this new banking system. Connectivity is a natural evolution of automation. We are confident the same evolution will happen in healthcare. Once our nation’s healthcare providers are fully automated, it will be possible to connect previously isolated healthcare systems.

Understanding and Overcoming Barriers to Rapid Adoption of Health Technology

The biggest obstacle to healthcare information technology adoption is securing the needed funding and resources. Today, physician practices and hospitals do not have access to the capital necessary to invest in their own technology or, on a larger scale, to fund connectivity. The federal government can play a key role in financing this healthcare transformation through creative funding arrangements. One option is through the creation of Government Sponsored Entities, which would provide indirect federal support through guaranteed loans for healthcare providers to purchase, adopt, and implement proven health technology solutions that are focused on error elimination and safety. Coupled with the pay-for-performance initiatives that reward providers for the quality of healthcare delivered rather than for services rendered, guaranteed loans or other financial incentives will spur technology adoption.

A combination of financial and performance incentives would help mitigate the initial expense of technology implementation. The reduction in medication errors and improved efficiencies in delivering improved healthcare will also provide a return on investment for healthcare organizations, thereby enabling them to repay the loans.

Conclusion

McKesson believes our healthcare system must adopt and deploy proven technologies today that reduce medical errors in order to save lives, improve the quality of care, and reduce costs. These initial steps should include:

1. Implementation of bedside bar-coded medication administration systems across the United States.

2. Elimination of paper prescriptions through use of e-prescribing in physicians’ offices.

3. Secure, online, “anytime, anywhere” access for physicians to critical patient information.

Automated information will enable our healthcare organizations to store and collect patient data, which will ultimately lead to a comprehensive electronic health record. Concurrently, we need to adopt the standards necessary to ensure interoperability among systems that will facilitate communication within our health system. If we execute these initiatives simultaneously, McKesson strongly believes that this Congress and this Administration will be able to deliver visible and measurable results with a lasting impact on the quality of healthcare for the American public.

As a nation, we have both the will and the means to transform healthcare for the better. This will be a remarkable legacy, and one we should act on today. Mr. Chairman and members of the subcommittee, thank you for your interest in this important subject. I will be happy to answer any questions.