The Connectivity Advantage for Senior Living and Skilled Nursing Facilities. Michael Harris Kinetic Strategies

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1 The Connectivity Advantage for Michael Harris Kinetic Strategies

2 01 The Connectivity Advantage for Senior Living and Skilled Nursing Facilities Providing outstanding care is the top priority of successful independent living, assisted living and skilled nursing facilities. Additionally, senior care centers understand that enriching the resident experience and offering valued amenities are essential drivers for resident satisfaction, facility occupancy and financial performance in a competitive market. Today s seniors are increasingly Internet savvy and rely on broadband to connect with loved ones through video calling, and social networks. Thanks to the Internet, patients or residents who are unable to leave their room can still travel the world virtually and follow their interests anytime, anywhere. Online education opportunities enable seniors to pursue lifelong learning, helping to keep their minds sharp and engaged. Senior facilities that can provide the connections residents demand will gain a competitive edge. Equally important, network investments can also be leveraged to enhance business operations and caregiving. Connectivity Counts In today s environment, high-performance Internet and wide area network (WAN) connections are an essential foundation for IP-based applications that improve care and productivity across the healthcare facility. Medical imaging and laboratory test results can be digitally delivered through the network in seconds rather than hours or even days, accelerating diagnoses and treatment. Electronic health records (EHR) provide complete medical histories and help staff coordinate care. Patient monitoring applications contribute to improved outcomes for chronic or life-threatening conditions. E-prescribing instantly transfers prescriptions from physicians to pharmacies, increasing accuracy and accelerating delivery of needed medicines. High-quality secure network connectivity can also support essential business applications for staffing, payroll and billing. Cloud-based care-management solutions track resident service plans and goals, coordinate medications and dosages, schedule physical therapy sessions and log progress notes. Mobile applications for tablets and smart phones make available essential real-time resident data at the point of care. Assisted living and skilled nursing facilities are also counting on network providers to support compliance with Health Insurance Portability and Accountability Act (HIPAA) and Health Information Technology for Economic and Clinical Health Act (HITECH) regulations. According to HIPAA security rules, healthcare organizations including nursing homes must ensure the confidentiality and availability of all electronic protected health information (EPHI). Under the HITECH Act, willful neglect of EPHI security rules can result in fines of $250,000 to $1.5 million. Raising the Bar on Bandwidth While a T-1 connection was once considered sufficient for many medical offices and healthcare facilities, times have dramatically changed. With T-1, all the workers and residents for example, at a senior living facility using a single T-1 line, share a mere 1.5 Mbps connection. That is less than the bandwidth accessible on one nurse s 4G smartphone. Understanding that applications like Wi-Fi, EHR, medical imaging and unified communications dramatically boost bandwidth utilization, assisted living and skilled nursing facilities are striving to improve their network connections accordingly.

3 02 Indeed, a survey finds that half of healthcare organizations that use cloud services have upgraded their network infrastructure. 1 A report by the U.S. Federal Communications Commission advises healthcare facilities to install broadband connections of at least 10 Mbps for nursing homes, 25 Mbps for large clinics and 100 Mbps or more for hospitals and medical centers. 2 With a T-1 connection downloading a CT scan takes three minutes, while an ECG requires more than a half-hour. With a 10 Mbps connection the download time for a CT scan drops to 30 seconds, and a massive ECG file can be transferred in under 5 minutes. With 100 Mbps access, download times drop to a mere 3 seconds and 30 seconds, respectively. Image File Download Time by Connection Speed CT (35 MB) ECG (350 MB) T-1 (1.5 Mbps) 3 min 31 min 10 Mbps 30 sec 5 min 100 Mbps 3 sec 30 sec Source: Kinetic Strategies 80% of healthcare organizations currently use cloud services Source: HIMSS Cloud-Based Care A recent survey of healthcare organizations found that more than 80 percent currently use cloud services, and half of these providers reported using cloud-based clinical applications. The top reasons for choosing cloud applications included accessing solutions that are less expensive than in-house IT maintenance, accelerating the speed of deployment, taking advantage of expertise that in-house IT lacks, improving disaster recovery capabilities and enhancing regulatory compliance. 3 Likewise, healthcare organizations are embracing mobile devices and applications. In a survey of healthcare providers, 83 percent said their physicians and 71 percent said their nurses use mobile technology to facilitate patient care. Two-thirds of healthcare providers said they used mobile technology to view patient information such as lab results and to look up other medical information, including clinical guidelines. 4 Turning to UC and Telemedicine Unified communications (UC) and IP collaboration tools are also improving care delivery and reducing costs. Eliminating the guessing game whether a colleague is ready to communicate, UC solutions offer real-time information about individual availability (i.e. presence) and how best to reach that person office phone, mobile phone, instant messaging, videoconference or other means. Additionally, voice calls and messaging can be linked with patient and resident management applications. For example, as incoming call numbers are recognized, a pop-up window launches with information about the caller. A leading U.S. skilled nursing provider with more than 300 facilities and 40,000 employees reports that UC solutions are delivering more than $300,000 in annual cost savings. Even more important, productivity gains enable caregivers to spend more time with patients and families. 5

4 03 Source: McKinsey & Co. 63% of patients say they would switch healthcare facilities for improved entertainment and food options Videoconferencing capabilities are also a key enabler of telemedicine solutions for nursing homes. A recent study published in the journal Health Affairs notes that when nursing home residents need medical care after regular hours or on weekends, they are often sent to a hospital emergency room. Not only is this approach costly, inconvenient and stressful for seniors, it may also increase health complications. In a trial that enabled nursing home residents to consult with physicians via videoconferencing, hospitalization rates declined by almost 10 percent. Researchers concluded that the approach could save $151,000 in hospitalization costs per nursing home per year. 6 The investments senior facilities make in Internet connectivity to deliver network applications that enhance care can also be leveraged to deliver highly valued digital amenities. 90% of higher-income seniors use the internet Source: Pew Research Center The Amenity Opportunity To maximize care quality, facility occupancy and financial performance, nursing homes and assisted living centers whether non-profit or for-profit are investigating best practices from other healthcare segments that offer patient or resident in-room services. For example, management consulting firm McKinsey & Co. found that when it comes to choosing a hospital, a patient s nonclinical experience is twice as important as the facility s clinical reputation. Furthermore, a majority of insured U.S. patients indicated they would be willing to switch facilities for better service and amenities. In particular, 63 percent said they would switch facilities for improved entertainment and food options. 7 Amenities play an increasing role in the competition for market share, concluded healthcare researchers reporting in The New England Journal of Medicine. They noted that a facility seeking to strengthen its financial position might view investment in amenities as a sound strategy. 8 Depending on the business model, amenities may be included as part of the core service or offered as a premium service solution that generates incremental revenue. Although an aging population is likely to boost demand for senior housing, reduced reimbursement rates from Medicare, Medicaid and private insurance companies may hamper profitability over the next five years, a recent market analysis contends. To stay afloat, operators will diversify services to attract customers and buoy profit margins. 9 Surging Senior Internet Use Seniors are among the fastest-growing segments of U.S. Internet users. Some 68 percent of Americans in their early seventies regularly use the Internet and 55 percent have broadband at home. Among higher-income seniors with an annual household income of $75,000 or more, 90 percent use the Internet and 82 percent have broadband. Nearly half of online seniors use social networking sites, while more than one in four seniors own a tablet, e-book reader or both. Almost eight out of ten online seniors agree that people without Internet access are at a real disadvantage. 10 Not surprisingly, when today s connected seniors and their family members evaluate assisted living and nursing home options, they seek just-like-home broadband amenities. Caregiver Connections Not only are digital amenities like high-speed Internet important for senior housing residents, they can also be essential for visiting family members and friends. With Wi-Fi Internet access, working adults are able to stay connected with the office or their own kids while visiting a parent or grandparent.

5 04 Likewise, senior residents can connect remotely with their loved ones online. One of the largest U.S. providers of assisted living for seniors recently launched a pilot program that takes connectivity a step further by offering a mobile device rental program. A daughter, 73, and mother, 93, both got ipads at the same time, and they have been FaceTiming every single day. She and her mom connect because of this project, said the senior care company s technology director. 11 Seniors watch 55% more television Source: U.S. Bureau of Labor Statistics Some service providers offer comprehensive Wi-Fi in addition to dedicated Internet access for senior care facilities. These solutions include managed Wi-Fi authentication and access with support for a wide range of bandwidth and pricing models. Assisted living facilities, for example, may provide free basic Wi-Fi access to visitors and offer enhanced service tiers for an additional fee. Such an approach can improve the quality and consistency of the Wi-Fi experience for both residents and their guests, as well as increase service profitability by encouraging power users to pay for the extra bandwidth needed for applications like streaming video. The Value of HD Video Besides broadband Internet, high-definition television (HDTV) is also a highly valued amenity for senior care centers. U.S. consumers continue to spend more time with television than any other leisure activity. Seniors aged 65 and older watch the most TV 55 percent more than the average American. 12 Research finds that 77 percent of U.S. households now have at least one HDTV set. Consumers who subscribe to an HD video service said they enjoy an average of 82 HD programming channels, nearly double the number available only five years ago. 13 Service providers such as Time Warner Cable Business Class now offer HD video solutions tailored to the healthcare industry. These solutions provide a homelike HD video experience while accommodating the unique needs of senior living environments. For example, a low-profile set-back box (SBB) attaches unobtrusively to the back of a television set to save space in patient rooms and recreation areas. For skilled nursing facilities, a pillow speaker interface enables integration with existing in-room television controls. Features such as co-branded interactive program guides, closed captioning, extensive channel line-ups and free on-demand programming add extra value. Selecting a Connectivity Provider Because connectivity is both essential to facility operations and offers highly valued amenities, selecting the right service provider for Internet, video and voice services is critical. Considering the following eight factors will help senior care centers evaluate providers for connectivity. 1. Facilities-Based Foundation: When evaluating Internet, video and voice service options, select a provider that owns its last-mile network and can offer future-proof fiber-based solutions that ensure adequate bandwidth. Facilities-based providers with broad network reach are better able to guarantee service quality. Using a variety of access technologies, they may also be able to serve a wide range of locations, including buildings in residential areas.

6 05 2. Service Level Agreements: Because Internet, video and voice reliability are so important to a senior care center s success, select a provider that offers service level agreements (SLAs). Such agreements set performance benchmarks for service reliability and, should an unplanned outage occur, responsiveness for repair and restoration. 3. Resident Wi-Fi Solutions: Providers that offer managed Wi-Fi in addition to Internet access can accelerate real-time service deployment and simplify management. Such turnkey offerings help senior living centers provide best-in-class connectivity solutions without burdening local IT staff. 4. Comprehensive HD Video Offering: To deliver HD video successfully, a service provider must meet the unique requirements of each senior care facility. For example, some facilities may require that an HD video service integrate with Pro:Idiom or other infrastructure that is already installed. Other facilities may prefer a turnkey HD video offering without on-site headend integration or capital expenditures. Choose a video service provider with the experience and flexibility to accommodate your facility s unique infrastructure and business requirements. 5. Cloud Capabilities: Consider a network and Internet service provider that offers essential cloud applications, including collaboration, business productivity, storage and online backup solutions. NaviSite, a Time Warner Cable Company, provides essential building blocks for cloud-based IT services that support the storage and management of increasing volumes of data generated by senior living and skilled care applications. Services include NaviCloud Remote Storage, NaviSite Managed Cloud Services, NaviCloud Director and many others. In a recent performance analysis, NaviSite s solutions exceeded those of its key competitors in the cloud services category Enhanced Security: Given the strict requirements of HIPAA and HITECH, look for a network and Internet provider that offers enhanced security features. For example, Unified Threat Management (UTM) solutions integrate a range of security capabilities, including an advanced firewall, intrusion prevention and detection, content filtering, virtual private networking (VPN), vulnerability management and advanced reporting capabilities. 7. SIP Trunk Support: While traditional PRI trunking may prove attractive for facilities with a digital PBX, senior care centers with an installed IP PBX can benefit from IP-based SIP trunking services. SIP trunks are an essential infrastructure ingredient for scaling unified communications applications. To maximize flexibility, scalability, cost savings and features, be sure a prospective provider offers SIP trunks. 8. Bundle Benefits: Some facilities-based providers are able to offer a complete bundle of network, Internet, Wi-Fi, cloud, security, video and telephone services. Purchasing these services together may yield cost savings and simplify management with a single bill to process and one number to call for support. The Connectivity Advantage High-quality connectivity has become a business necessity for senior living and skilled nursing facilities, offering a powerful way to enhance resident care and offer amenities that boost occupancy, revenue and resident satisfaction. By partnering with a service provider that can enable leading-edge cloud and

7 06 collaboration applications, as well as a just-like-home broadband Internet and HD video experience, senior care centers gain an edge in today s competitive market. About the Author Michael Harris is principal consultant at Phoenix, Arizona-based Kinetic Strategies, Inc. Applying more than 15 years of experience as a strategist, research analyst and journalist, Michael consults with select clients in the networking, Internet and telecommunications industries. About Time Warner Cable Business Services Time Warner Cable Business Services, a division of Time Warner Cable, offers a full complement of business communications tools to small, medium and enterprise-sized companies under its Time Warner Cable Business Class brand. Its Internet, voice, television, network and cloud services are enhanced by award-winning customer service and local support teams. Through its NaviSite subsidiary, Time Warner Cable Business Services also offers scalable managed services, including application services, enterprise hosting, and managed cloud services primarily in the U.S. and U.K. Time Warner Cable Business Services, founded in 1998, serves approximately 625,000 business customers throughout Time Warner Cable's service areas. For more information, visit Time Warner Cable. All Rights Reserved HIMSS Analytics Cloud Survey, Healthcare Information and Management Systems Society. 2 U.S. Federal Communications Commission, Healthcare Broadband in America, August HIMSS Analytics Cloud Survey, Healthcare Information and Management Systems Society. 4 3rd Annual HIMSS Analytics Mobile Survey, Healthcare Information and Management Systems Society, February Healthcare Provider Improves Staff and IT Productivity, Cisco Systems, Use Of Telemedicine Can Reduce Hospitalizations Of Nursing Home Residents And Generate Savings For Medicare, David Grabowski and James O Malley, Health Affairs, February A Better Hospital Experience, McKinsey Quarterly, November The Emerging Importance of Patient Amenities in Hospital Care, Dana P. Goldman, Mary Vaiana and John A. Romley, The New England Journal of Medicine, December 2, IBISworld, Nursing Care Facilities Market Research Report, May Pew Research Center, Older Adults and Technology Use, April Ways Providers are Spicing Up Senior Living, Senior Housing News, July 6, 2014, 12 American Time Use Survey, U.S. Bureau of Labor Statistics, October HDTV XI, Leichtman Research Group, March Rick Blaisdell, Choosing the Right Cloud Provider for Your Business, January 2014.