Among the issues plaguing the healthcare system in the United States, the lack of complete information about individuals’ medical care has been fingered as a significant contributor to rising costs. #b#John Phelan#/b#, founder and chief executive officer of Zweena, an E-health records firm based at 51 Everett Drive (, shares an anecdote about his wife’s recent fall from her bicycle that resulted in a cracked elbow and required an operation. A couple days later at the outpatient surgery center Phelan sat in a meeting with the orthopedic surgeon, two orthopedic nurses, and the anesthesiologist, and he asked them, “Does anybody know how much this cost?”

Although an interesting question, said the surgeon, it wasn’t one he had ever heard. He shared his fee with Phelan, noting that he had to augment the fee to get paid adequately for the surgery by the insurance company. The total bill, he added, would be about $50,000, with the majority covered by insurance.

“Here we had just consumed a lot of healthcare, and we didn’t have any idea what it cost,” Phelan says. “Nowhere else in the U.S. does a consumer operate in that fashion.”

Employers are not happy with this situation. Burdened as companies are with healthcare costs, they are looking for ways to save. Phelan’s answer to the question “How do we empower our employees around being better consumers of healthcare?” is, at least in part, electronic health records and the health information exchanges that allow those records to be shared regionally among doctors and hospitals.

Phelan will speak on the current state of E-health records on Thursday, December 2, at 8:30 a.m. at the Holiday Inn East Windsor. The conference will focus on how, as a state and a region, we can develop digitized health capacities and be able to exchange healthcare information within safe and secure methods between providers and consumers. Cost: $120. For more information, go to or call 856-787-9700.

The first step to exchanging health information is to make sure it is digitized. Once digitized information is available it can be sent to a secure data storage site. Health information exchange companies will manage this information and create digital highways with access points through which health systems and hospitals can share patient information.

“Health information exchanges are not a new concept, but one that is actually now starting to work,” says Phelan. New Jersey has a state plan that calls for four geographic areas to establish health information exchanges: north, north-central, central, and south. Already a number of smaller-scale exchanges exist. One links three hospitals in Camden — Virtua, Cooper, and Our Lady of Lourdes; another pulls together about eight hospitals in Newark; and 13 others, says Phelan, are either in the process of being put together or are piloting a program.

Because digitization may help improve patient outcomes while saving money, the federal government is supporting it by financially reimbursing hospitals and doctors that attain different levels of the meaningful use metrics. These metrics were developed by David Blumenthal, national coordinator for the federal Department of Health and Human Services, and his team, who Phelan describes as the “national architect for digitizing health information.” The ultimate goal is a national health information network.

All hospitals need to address this, says Phelan. Although it costs money to digitize and create health information exchanges, the government will reimburse hospitals once they have built the system and passed the metrics. The government has imposed a three-year step approach to achieving meaningful use. But if hospitals choose not to participate, they will face decreased government funding in the future.

Hospitals that opt out will not be reimbursed at the same rates they currently receive for Medicare and Medicaid patients, Phelan says. “As hospitals are already dealing with a very aggressive margin, and hospitals in New Jersey are not doing well in general, this is going to be a real challenge and something that they have to pay attention to.”

Digitizing health information and making it available via health information exchanges has advantages that extend throughout the healthcare system:

#b#Better medical decisions, with all information in hand#/b#. For a hospital, being able to access digitized information through a health information exchange gives patients the assurance that, even in emergency situations, their cumulative health records will be available to doctors. This ability to access health information at point of care can also give hospitals a competitive edge as they struggle to survive.

#b#Fewer redundant tests and procedures#/b#. If healthcare providers are able to pull up the results of all tests that a patient has undergone, they will be able to make better decisions about what further tests a patient actually needs.

#b#Errors in medical records corrected#/b#. Phelan shares a personal anecdote in which a provider shared incorrect information with an insurance company — on purpose. When checking out from a visit to a dermatologist for a bad case of poison ivy, Phelan noticed that the doctor’s insurance czar had coded his skin problem as eczema rather than poison ivy. He told her of the error, and she responded, “We often code for eczema because reimbursement is a lot cleaner with that.” Not keen on putting a nonexistent eczema on his health record, Phelan asked her to correct the form.

As more patients and family members get access to digitized health information, hospitals and doctors will have to adapt, says Phelan. “It will be a big step for health institutions. Hospitals and doctor’s offices are not used to consumers having access to their own health information, but this will become more and more the norm.”

A native of New York, Phelan earned degrees in English literature and economics from Columbia, then joined the Peace Corps. His time in Morocco treating polio victims was a turning point (the name of his company, in fact, is a Moroccan word meaning “beautiful child”). With an already strong interest in sales and marketing complemented by his newer commitment to the healthcare field, he became a pharma salesman for Squibb Pharmaceuticals, selling a wide range of medicines.

When Squibb partnered with Novo (soon to become Novo Nordisk) Phelan took the Midwest territory, quickly rising to No. 2 salesperson in the company. Moving to Wyeth Pharmaceuticals, Phelan handled the burgeoning field of managed-care sales.

Then in 2005 Phelan began experiencing the healthcare system as a user. Following several family illnesses, he sought comprehensive medical records for his children. None were available. With all the medical paperwork, billing, and transcribing, no provision had been made to keep any continuing record for any individual patient.

The following year Phelan launched Zweena, with the goal of giving consumers greater access to their own health information, via the Internet. Zweena collects health records on behalf of consumers, contacting physicians’ offices; collecting a patient’s paper records; and scanning and digitizing the information.

Zweena is working with early adopters, because, says Phelan, “most people are not used to being engaged at this level with their health information.” But these early adopters — typically college-educated women between 30 and 75 with a high income — are managing the healthcare of spouses, children, and potentially parents and parents-in-law. “They know this is an absolute nightmare,” he says.

With health records easily accessible on the Internet, individuals can then share their records with their physicians and perhaps family members. Sometimes doctors are surprised to find out about other doctors their patients have visited as well as prescription drugs their patients are on.

Some people are nervous about the idea of sharing this information. But just because the digitized record exists does not mean that it automatically goes to any particular doctor. “It’s your job to let doctors know you have access to this information and that you would like them to read it,” says Phelan.

Another area important for developing health information exchanges is privacy. As do other companies concerned with potential data piracy, Zweena uses Verisign, which encrypts all of Zweena’s health information, and also pays people who specialize in data security to try to hack into the company’s system.

A lot of the software development around digitized health is happening in New Jersey, says Phelan, often through Indian companies with offices here and abroad. DeVry University and the Stevens Institute of Technology are starting to focus on health informatics.

But the United States is a late comer to electronic health records. “The U.S. admittedly is way behind other countries that are a half or quarter of our size and made this a bigger issue,” says Phelan. With the field still in transition, he estimates that it will take a good 10 to 15 years to get all the systems in place.

But doing so is important. “We need to give consumers better information about their health,” says Phelan. “Hopefully with more access to their information, they or their providers can make better decisions about what they need.”

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