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Table of Contents

bulletKaiser Shakedown in Hawaii: Kaiser Requests 11% Rate Increase for 2005

 

bulletHealthConnect: Kaiser Swindling Congress

 

Kaiser Shakedown in Hawaii: Kaiser Requests 11% Rate Increase for 2005

[Editor: Kristin Sawada of Pacific Business News reports "Kaiser this week filed for state approval of its proposed 2005 average rate increase for small businesses." Once again, our former Kaiser IT employee expresses outrage that Kaiser has the cojones to request another rate hike in Hawaii after wasting billions, that's right folks, billions of dollars on HealthConnect.]

Unbelievable. Kaiser is trying to extort another 11% rate increase in Hawaii, a year after getting an 11.7% increase. Hawaii has some of the highest insurance rates in the nation, and its been crushing the people who live there.

 

Observe the no-choice business model. Kaiser executives decide *they* want a colossal Automated Medical Record system (or the appearance of one - read the rest of my blog), makes a massive investment, then just "passes the cost on" to the consumers. The consumers never got to vote whether they wanted to pay for this. Consumers are being told where there place is (at the mercy of Kaiser) and being forced to adjust.

 

Kaiser technology operations is massively wasteful. A huge write off of money and effort (not to mention people) occurs every time Kaiser decides to try a new "process": i.e., every five minutes. So the technology is not only forced on consumers, the price is enormously inflated. See the rest of my blog for how hiring managers for their special connections (now called "ability to cultivate relationships") rather than even a modicum of technical understanding contributes to this problem.

 

This is why the doctors I've talked to all wanted to get out of medicine and into IT. They regret the choice they had made to pursue medicine because the easy big money was in medical technology.

 

Worse, Kaiser is using their price-setting power to turn public opinion against unions. So, not only may Kaiser get to bolster it's revenue stream, it gets to weaken the unions at the same time. These rate increases have nothing, zilch, nada to do with increasing the pay of unionized workers: the problem is the rampant salaries and spending of upper management.

 

The real issue is out-of-control technology spending. For example, the requested budget for the office of the California CTO, Glenn Rennels, was over 9 million dollars last year. That's a budget for an office with around 30 middle managers: and, of course, a lot of the money went to outsourcing and consulting. Think of how many unionized employees could have been paid with that money. Why complain about paying a unionized employee $25/hr. when you are paying a longterm consultant $150/hr?

 

As for Hawaii, the businesses there should just band together to boycott Kaiser. The membership in Kaiser's corporate plans plummeted in 2003. In reality, businesses have a lot of leverage right now. They have the power to draw the line and just say no. I challenge them to do it.

 

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HealthConnect: Kaiser Swindling Congress

Update 11/9/06: Kaiser Permanente Chief Information Officer Cliff Dodd resigns amid Epic HealthConnect scandal

 

[Editor: HealthConnect is Kaiser Permanente's multi-billion dollar, supposedly new and state of the art electronic medical records system, which according to this article by a former Kaiser IT employee is none of the things Kaiser has claimed it is (except for the multi-billion dollar part).  In typical Kaiser take-over-the-world fashion, wasting premium dollars is not enough.  Kaiser is attempting to recoup development expenses by selling this archaic and clumsy system to the government as a national patient database.  Issues of value, efficiency, honesty and patient privacy abound.  For more background see these media reports.]

 

Recently Kaiser has been trying to position itself as the "authority" on the automated medical record, and Kaiser executives have been trying to sell Congress on their amazing HealthConnect system.

 

The problem is HealthConnect is not a system: it's a fancy new label for a motley collection of old "legacy" applications combined with some new components from a vendor called Epic. The "Epic" modules were originally billed as the Automated Medical Record, but Kaiser was chiefly interested in the billing module, so they settled for a less ambitious project of combining a few Epic modules with the variety of workhorse systems that have been in place for years. It's an act of deception to present this situation to Congress as either a new, cutting edge system (even Epic is based on archaic technology) or a fully integrated system. 

 

Don't take my word on it. Let me quote Kaiser's own 2002 Technical Architectural Patterns for Enterprise Application (the rehabilitation of legacy systems as "assets" to be "exploited"): "The requirement for and proliferation of various integration techniques within KP has resulted in what Gartner terms 'application integration spaghetti'. While individual domains such as membership, sales, and marketing (e-Health) may have a strategy for managing and reusing integration, there has been no enterprise integration planning or documentation." And later... "The current inventory of integration at KP is not documented in one single location." Hmmm, doesn't sound all that unified or cutting edge to me.

 

Instead, Kaiser has been integrating applications in numerous (and costly) "transition" projects (presumably to be thrown away once an Automated Medical Record actually happens). One proposal for such a transitional project was called "Safe Highways" (later rolled into the sexier sounding "eStrategy"). The "Safe Highways" document was authored by the CTO for Kaiser's Northern California region.

 

"...the approaches focus on developing "point-to-point" access from the client application to the legacy back-end application. The implication of this organic growth is that each development team has to independently solve the problem of how to access the legacy applications and data. A solution developed for one system is therefore not re-usable by other projects. The effect is that each new subsequent client application development initiative accessing the same legacy system must build its own specialized logic and pathways...The approaches currently deployed are fragile and require a high degree of maintenance as well as highly skilled and knowledgeable technical staff to be used...changes, no matter how minor, have the potential of producing unpredictable and undesirable effects on client and other legacy applications where dependencies are not carefully planned or monitored...Relying on individual development teams to build point-to-point interfaces to legacy applications in an unplanned and uncoordinated fashion results in consistently high development costs, an increasingly fragile operational environment and unacceptable time-to-market for innovation projects.

 

The problems identified above are widely recognized in the development community...A major challenge in implementing vendor product solutions is the need to integrate the product with existing legacy applications.... In some environments where this kind of lookup feature is not available, users are forced to re-key the demographic information they read from a 3270 screen onto a workstation screen. This is an inefficient and error prone process...Developing APIs for legacy applications is a complex and effort intensive activity. The PARRS API currently used by KPOnline, the Call Center Interactive Voice Response system and Call Center Stargate agents took two and a half years to develop at a cost of over three million dollars. It is a complicated interface to use. Client application developers characterize the development effort using these APIs as “slow and tough”...More importantly, most legacy applications do not have APIs available. Given the time and expense required to develop these APIs, it is not a cost effective strategy to provide all necessary access to business functionality directly through legacy APIs, many of which use different formats and protocols...). Many of the complexities client application developers must tackle are due to the heterogeneity in operating platforms, programming interfaces, access methods, semantics, etc. that are inherent in any legacy environment. Development initiatives in which this kind of complexity is exposed to developers require highly skilled and specialized programming expertise. Even with the appropriate skills available, the development work is challenging."

 

Problems identified in current environment

 

bulletRequired application interfaces do not exist
bulletImplementing functionality at the national level requires building interfaces to multiple legacy (regional) applications
bulletExisting APIs “slow and tough” to work with – too much effort & technical expertise required
bulletExisting interfaces highly application dependent
bulletExisting solutions not readily re-usable or shared
bulletMany existing interfaces not published
bulletLandscape of technology interface options creates unnecessary complexity
bulletMultiple legacy solutions create complex operational environment
bulletNo strategy for managing technology shifts
bulletSecurity not managed consistently across layers – unmanaged risk
bulletScalability of existing solutions not assured
bulletOperational environment complex and fragile – systems are difficult to maintain
bulletSystem availability is difficult to manage and assure

 

These are the recent words of highly placed Kaiser executives! I could extract many similar quotes, but retyping is tedious. And perhaps it will put Kaiser's strategy in better context if I step away from the technical documentation for a second, and quote from a Kaiser presentation called "Reputation Management." Hmmm, have to find it first, but this is the document where the Kaiser bigwigs explain how to craft a message to appeal to different audiences: no detail is overlooked. Kaiser employees must be educated to avoid referring to buildings (reminds people that Kaiser is a business) and to use "We" as much as possible (to suggest caring and family relationship). It's a rather sinister read: direct quotes tomorrow - I promise.

 

But back to Kaiser's attempt to deceive Congress. If any person with any Congressional connection at all is paying attention, I beg you to read the quotes above carefully. Don't let Kaiser keep snowing the political powerbrokers with all this "HealthConnect" business. It's a smokescreen. There's nothing behind it but a pile of elderly green screens, a few Epic modules (chiefly the billing system), and various APIs and web service experiments cobbling it all together. Kaiser's just trying to recoup technology expenses with public money: and they don't deserve it because they have wasted *massive* amounts of money over the years. Feel free to ask me to expand on the nature of the waste.

 

Moreover, let's not forget Kaiser's ultimate goal in systems integration: to profile and sell insurance to "target" populations and to support its own risk management and litigation interests. The public should not be funding its own enslavement!

 

6/26/2004

Media Reports

June 17, 2004 - Testimony of Andrew M. Wiesenthal, M.D. - Associate Executive Director, Kaiser Permanente - before the Subcommittee on Health of the House Committee on Ways and Means

 

March 19, 2004 - Pacific Business News - Kaiser Permanente's $3 billion switch to paperless records begins next month at its Hawaii outpatient clinics.

 

May 14, 2003 - SFGate.com - Kaiser exporting privacy

 

May 23, 2003 - SFGate.com - Real risks in Kaiser's contracts

 

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