Company X's HIPAA-compliant medical image capture application

HIPAA Compliant Electronic Medical Record Capture/Management System

The successful outcome of medical processes largely depends on complete, relevant, and timely medical data. Up-to-date and accurate data allows for images of surgical wounds, surgical pathology, and operative techniques to be used in the most efficient ways for patient management. However, while there are technological solutions that could improve medical data storage and retrieval systems, any improvement to medical data systems must include not only technological elements but ethical and legal considerations as well. There are multiple regulations guarding the privacy and integrity of patients' medical data. One of the major regulatory instruments that governs medical data in the United States is the Health Insurance Portability and Accountability Act (HIPAA), which imposes harsh penalties for breaches in patient privacy, data handling, and data security rules as defined in the act. Hence, images of medical data or medical procedures that are not HIPAA compliant must be discarded. To be HIPAA compliant must meet certain standards for image quality as well as accurate accompanying information (such as when and where the image was created) along with an adherence to the strictest standards for patient privacy.

Company X has conceived the idea that there is an opportunity for it to formulate an "image capturing process that is fully compliant with HIPAA regulations." The company has developed an application (app) that runs on standard smart-phone platforms, where this app allows the phones' high-resolution camera to capture the relevant images and then to process them in accordance with HIPAA-process requirements. The company's plan is to market this application primarily to physicians working in hospitals as well as to primary care physicians employed in other settings.

Organization, Market, and Competition Characteristics

As noted above, Company X has determined that the segment of the medical market that would be most likely to buy this application is primary care physicians as well as various physician specialists who work in hospitals. In part because of the enactment of HIPAA and in part because of the systematic changes brought about to the American healthcare system over the last generation due to the pervasiveness of HMOs and more recently PPOs, physicians find themselves with far more clerical responsibilities than their predecessors had to contend with.

Even as the distribution of work has shifted in the medical field, requiring physicians to do more and more of the work themselves, the practice of medicine has become more and more complex with individual patients undergoing far more tests (and far more complicated tests) than their predecessors underwent. This combination of more work and greater medical, technological, and legal complexities had made physicians more open to technologies that will save them both time and money. They thus constitute an ideal demographic segment for this new application.

The financial situation of the company is somewhat risky given that it does not yet have any customers or a product on the market. However, the relatively low-cost of a software start-up counters this fact, making the company's financial future reasonably sound.

Organization of the Technology Personnel

The company is a relatively small one given that it is selling intellectual technology and does not need significant infrastructure per se: It does not need a large factory, for example, or a large-scale distribution system. The company needs its software engineers who, while they have already developed the software, will need to be present to vet the system as it is rolled out. There will necessarily be changes that need to be made for the beta version, and even once the beta version is released there will be the need for future updates that reflect changes in medical practice, software technology, hardware technology (as new phones are released into the market), and in legal regulations concerning patient records.

The company will also include a marketing department. The background of these staff members will include both marketing techniques and a medical background. While there are generalized marketing techniques that the department can rely on, the marketing staff will be far more able to sell the country's product if they can communicate with the physicians if they can do so in a collegial way.

Physicians are used to being pressured by marketers, especially those from drug companies. As a result, they are likely to respond negatively to what they feel is a hard sell. To avoid this response from physicians, the marketing staff must be able to make a firm alliance with the physicians who can in fact benefit from this product, the company's staff must be able to stress the specific ways in which physicians would benefit from a product that is relatively low cost. The marketing staff must make it clear that they are not aligned with pharmaceutical companies but rather with patients and their doctors.

The company will also have an IT division that oversees the distribution of the application via web access. There will be no need to produce a physical version of the software (such as on CD) since it will be available as a download. This decreases the cost as well as it increases its efficacy.

The company will be privately held, at least initially, which simplifies its structure. In addition to the software department and the marketing department, it will have the same staff that any well-run modern company has, including human resources, payroll, and a hierarchy that consists of the president and one to three vice presidents. The company will remain small, and so therefore efficient and collegial, without outsourcing tasks such as payroll.

While there would be cost savings by outsourcing activities such as payroll, the advantages of not doing so in terms of company morale and cohesion are more important and will benefit from a company that is self-contained. Not only does this ensure that changes can be implemented more easily and more quickly, but it ensures that there can be the highest level of quality control overall aspects of the company's functioning.

All technical design and programming for this application are performed internally and will not be outsourced. The front end of the system runs on smart phones and so requires close support from smart-phone platform manufacturers. This integration will be easier to accomplish if there is no outsourcing. An examination of the current smart phone market suggests that the winners in the market scrimmage suggests that Google and Apple will be the primary companies with which Company X must communicate to ensure the best possible product.

Conversion Effectiveness and Valuation Methodology

Despite potential problems that may be encountered by physicians, company officials and software designers are confident that the application will be welcomed by members of the medical community and will be able to hold its own against other Electronic Medical Management products. Among the key aspects of Company X's product that will give it a secure footing in this market are the following:

The application will be able to discern any unauthorized devices and will block any unauthorized data access. This is of course essential because any breach of confidentiality as mandated by law (along with the ethical requirements of the profession) will expose the physician to distinctly detrimental consequences including possible lawsuits and even loss of licensure.

It will annotate the captured data with necessary identifiable information, including time, date, and geographical location. This is essential both because of HIPAA requirements and because of fundamental medical considerations. Often patients, especially those with the most serious medical conditions, have repeated scans and other tests in a short period of time. It is imperative for the highest quality of treatment that a patient's physician be able quickly and accurately to distinguish between different X-rays, MRIs, etc. Any method that reduces the chance of confusion among different scans -- as does this software application -- will allow physicians to feel more comfortable with the care they provide.

The backend system will integrate the data from the captured images to other existing EMR systems. This is an advantage that this application has over a number of other software systems which are more proprietary. The company's app blends the high degree of security required to ensure that patient confidentiality is never compromised with the openness in terms of software design that allows integration with the widest possible number of software and hardware systems.

The application will securely transfer data to the HIPAA-compliant backend-system and destroy traces of information on the capturing device. As is true with the above notation, this is a key selling point of this application. It provides both very high levels of security to be compliant with HIPAA regulations as well as the ethical norms of the profession while at the same time providing the maximum level of hardware and software flexibility.

The physician can annotate the image with both voice and text notes of any length. This function will be fully integrated with the phone's voice-note and text systems. This will save the physician the time that s/he would otherwise have to expend in learning a new set of commands with which to communicate with the EMR technology. This might seem to be a relatively minor advantage since current software systems are generally highly user friendly. However, it should not be overlooked how having to learn a new software system can be a significant block to adopting a system. Physicians generally feel that they are already so overburdened with increased patient loads as well as the paperwork that accompanies modern medical practice that they are reasonably reluctant to take on the project of learning new software, no matter how little time this might actually take.

Works with a wide range of camera types and settings. This reiterates the point made above. Because this is a software application that works with all smart-phones, there will be no instance in which a physician has to learn software specific to the application. (This is, of course, presuming that the physician has a smart phone. Certainly there are physicians who do not have smart phones. However, given how many individuals now have smart phones and given their ever-increasing popularity, this in and of itself does not seem as if it will be a major barrier to the wide-scale acceptance of the product.

While all of the above facts are important in terms of providing value to physicians who adopt the system, the most important advantage that this application offers to physicians is that it is funneled through a phone rather than another form of hardware.

EMR systems on the market now are based on hardware such as laptops or tablets. While these are certainly useful devices and portable in a way that could never have been imaginable to the first generation of computer users, they are not close to smart phones in terms of both portability and ease of use in terms of user familiarity with the devices. The company's application provides the optimal combination of simplicity, cost, and scalability.

The state of EMR technology and practice at the moment is something of a Wild West arena, as has been the case with each new batch of software possibilities -- and even with any new batch of technological possibilities. There is currently no clear winner in terms of either hardware or software directions for the future of EMR. There is therefore a chance for Company X to establish itself as a major player.

The importance of electronic medical records will continue to grow as healthcare reform takes effect and as the practice of medicine becomes increasingly technological. The market beckons, and Company X is there to answer the call.