Managed Healthcare Executive - May 2010 - (Page 29)
{ TECHNOLOGY } Stop pumping cash into your old legacy system clunker Drive the upgrade process with transition teams BY M ICHAEL T. MCCUE F Michael T. McCue is a Virginia-based freelance writer. EW THINGS strike more fear into the heart of a health plan executive than the thought of replacing a legacy system. Whether it’s a technology that adjudicates claims or runs some other mission-critical business process, it’s always tough to sever ties with an enterprise system that has served its purpose well for so many years. Still, there inevitably comes a time for all technologies when the drawbacks simply outweigh the bene ts. Often the key to determining whether a legacy system has reached the end of the road is to look at the bigger picture, according to Peter Bristol, senior director of information technology with Medford, Mass.-based Network Health, a Medicaid plan. “One good indicator that a legacy system is becoming ine cient is when the organization stops hitting key metrics, such as quality of service indicators and auto-approval rates for processes,” Bristol says. “The technology itself might seem to be functioning properly, but if the overall organization isn’t performing the way it should, it might be because a legacy system just isn’t pulling its weight anymore.” When executives begin to wonder whether that dreaded time has come, they need to ask themselves: 1. Although I see the end of the line for this legacy system, how do I know if this is the right time to replace it? 2. Can I get a few more productive years from the technology and push the expense and productivity costs into the future? 3. I’ve come to grips with the fact that this legacy system is holding me back and costing more than it’s worth, but how do I go about replacing it? Even if this year isn’t the right time to launch a new technology, major system replacement is a massive and expensive undertaking that can take years to plan, much less execute. Executives should know what signs to watch for and what they need to do to prepare, because despite what the old adage says, death and taxes aren’t the only guarantees in life—legacy system replacement is, too. There’s no way to avoid it, because the law of diminishing returns eventually comes into play—much like the old clunker car that keeps running but needs a new quart of oil every week. “While there are costs and risks associated with a major system change, MAY 2010 Getty Images / James Woodson 29
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