Thursday, December 25, 2008

Trouble In Paradise

In the PACS world, a company either survives until the next RSNA, it goes under, or it is bought out by another company, either a rival or an investor. The last option is supposed to be the fate of Emageon, the Birmingham-based PACS vendor started by a couple of neurosurgeons at UAB.

Emageon has had some financial woes of late, and ultimately, its shareholders voted to sell to Health Systems of Tampa. From the Tampa Bay Business Journal:

Health Systems Solutions was founded in Tampa in 2002 as a software company serving home health care agencies. Under new management, the company has transitioned to providing custom IT solutions and services. It also has relocated its corporate headquarters to New York, while Tampa remains headquarters for the home health care operations. . .

The acquisition of Emageon will provide Health Systems Solutions with a strong platform to enter the medical imaging market, company executives said during a Dec. 3 investor presentation at the Piper Jaffray Health Care Conference.

Health Systems was all set to buy Emageon for $62 Million, or $2.85 per share. This is a pretty good deal, especially in light of the fact that Emageon itself bought a cardiology imaging company called Camtronics from Analogic Corporation in 2005 for $40 Million. Those were the days.

There appears to be some trouble in Paradise. Emageon stockholders voted on December 18 to proceed with the merger/purchase. But on the 22nd, CEO Chuck Jett announced:

"We believe we have an obligation to consummate our merger in an expeditious manner in accordance with the requirements of both parties under the merger agreement," said Chuck Jett, Chief Executive Officer of Emageon. "We also believe our stockholders, who have resoundingly supported this transaction, desire us to move forward without delay. Health Systems has not agreed to set a closing date, instead making additional due diligence requests. This news was especially surprising given Health Systems' recent public and private support of the transaction."

Mr. Jett continued, "There is no due diligence condition in the merger agreement and the time for due diligence ended when the parties signed the merger agreement. Health Systems has also asserted purported breaches of our representations, warranties and covenants under the merger agreement, which we categorically deny and reject as immaterial. Health Systems is clearly stalling for reasons that are not apparent to us and unrelated to any purported breaches of the merger agreement. We believe we have satisfied our conditions to closing and that it is time for Health Systems to comply with its obligations and close the merger. In the event the closing does not occur by Tuesday, December 23, 2008, we intend to pursue our rights and remedies under the merger agreement."

I suppose its better to get the fighting done before the wedding, but a naive reader such as myself would be very wary after this statement. I am a firm believer in due diligence , and it sounds like Mr. Jett is saying that "Health Systems don't need no stinkin' due diligence" because Emageon is a good company (which it is, of course) and they didn't ask for it in the prenup.

So, what was the problem? It seems to lie with the purchase price itself. Some (lawyers) seem to think it was too low and implied that there was a little hanky-panky involved:

Emageon Inc. (“Emageon” or the “Company”) (NasdaqGM: EMAG) announced that it agreed to be acquired by Health Systems Solutions Inc. Under the terms of the agreement, Emageon shareholders would receive $2.85 in cash for every Emageon share they own, for a total sale price of approximately $62 million. The price is unfair given that Emageon stock traded at $2.90 per share as recently as June 23, 2008 and at least one analyst has a $4 per share price target for Emageon stock. Furthermore, the sales process the Company conducted was flawed, given that in contravention of their fiduciary duties to maximize shareholder value, the Company’s Board agreed to a “no-solicitation” provision and a $3 million termination fee which will ensure no superior offer will ever be forthcoming.
And then again, maybe the price was too high, since the stock price was putting along at $2.50 until some more recent unpleasantness (see below) drove it down to $1.50 per share.

The spat was apparently put to bed, and the deal was to proceed (From the Birmingham Business Journal):

Health Systems Solutions Inc. has closed on its $62 million purchase of Birmingham’s Emageon Inc.

A day after Emageon Inc. demanded in a federal filing Health Systems close the deal by Tuesday, the Tampa firm told its bank to transfer $62 million to the medical technology firm to close the previously announced merger deal.

Health Systems said it instructed Stanford International Bank Limited to provide the funding to consummate the transaction on Tuesday. Emageon has not yet received notice of SIBL's response to this request, according to a news release.

Emageon officials claimed in a Monday news release that Health Systems had not agreed to a closing date and had made additional due diligence requests. Health Systems agreed to buy Emageon in October. Emageon produces technology that helps doctors analyze images to diagnose and treat patients.

Emageon’s shareholders voted to approve the sale on Dec. 17. Health Systems has said it will keep Emageon’s base in Birmingham.

Emageon stock fell to $1.30 Monday morning after closing at $2.22 on Friday. It was trading near $1.65 in late Tuesday morning trading.

So far, so good, right? Wrong... An Emageon press release from December 24 (yesterday) states:

Emageon Inc. (Nasdaq: EMAG) today announced that it has received a letter from Health Systems Solutions, Inc. (OTC Bulletin Board: HSSO) indicating that Stanford International Bank Limited (SIBL) will not provide the funding to consummate the transaction at this time. The letter further provided that Health Systems is continuing to seek to cause SIBL to fund the transaction and that Health Systems is undertaking further efforts to consummate the transaction.

Commenting on the situation, Emageon Chief Executive Officer Chuck Jett stated, "We continue to seek to engage Health Systems and SIBL in a constructive dialogue towards the goal of closing as soon as possible. We are also hopeful that Health Systems will begin to take all such actions as required under the merger agreement to remedy the failure to finance the transaction and close promptly. Failure to remedy the financing promptly will require us to seek all remedies to enforce our rights for the benefit of our stockholders."

Uh oh. Now, whatever could Mr. Jett intend to do with this? Will he force Health Systems to find other financing? Is there some big penalty they will have to pay? Will they kiss and make up (and consummate), or will they break up and seek other partners?
Stay tuned for the next episode of "As the PACS Companies Turn."


The Emageon saga continues, dragging the company’s name further in the mud. Would-be acquirer Health Systems Solutions, Inc. says its major shareholder, Antigua-based Stanford International Bank Ltd., won’t provide the funds for the acquisition to go through. Emageon CEO Charles Jett seems to be the outraged spokesperson, but he’s not a major player given that he was ousted from the board last summer after an ugly proxy fight with Oliver Press Partners. Now it could be that Stanford is just playing with the stock behind the scenes, safely tucked away in Antigua outside US jurisdiction, but it makes more sense that they’ve found something they don’t like about Emageon and their carefully created legal structure gives them an out that they’ve chosen to exercise. Or, that billionaire owner Allen Stanford and Oliver Press don’t get along, like Gordon Gekko and Sir Larry Wildman in Wall Street (Stanford really is a Sir, the first person knighted by Antigua, where he holds dual citizenship along with the USA).
Here's a picture of Sir Allen's little bungalow in Antigua:

Tuesday, December 23, 2008

Farewell, Majel

Another beloved "Star Trek" actor has passed away. Majel Barrett Roddenberry died on December 18, at age 76. While we know her best as "Nurse Chapel," she appeared in every incarnation of the franchise, beginning with her role as "Number One" in the original pilot. Her voice became that of most of the Enterprise computers throughout the various series.

I had the chance to meet Ms. Barrett in 2004 at the Star Trek convention, and while she was a little harried after a long day, she was very gracious to me and my son. She will be missed.

Sunday, December 21, 2008

Witness For Hire . . .A Jewish Perspective

I have shared my thoughts here and there about the travesty the "expert witness" system in this country. My personal feeling is that payment for testimony stifles the truth, whatever that turns out to be. I outlined this in a letter to the AMA News years ago:

These questionable suits would not progress beyond the lawyer's office if it were not for members of our own profession who choose to serve as "expert witnesses." In most cases, their testimony is purchased for fees of $200 to $400 per hour for case review, and $5,000 to $10,000 per day of testimony. There is no recourse should they perjure themselves on the stand, because they are "just giving opinions."

In my humble opinion, this is where the system has gone haywire, and the aspect that we as physicians actually could impact. My personal solution has been to refuse payment for testimony. Period. It could be considered one's civic duty to tell the truth, and I refuse to extort an outrageous fee to do so. If my testimony is required, I insist upon a subpoena, and I make it clear that I am present because I am required to be there, not that I am being paid to be there. Simply put, if testimony can be purchased, then it can be bought.

I subscribe to a Jewish web-site called, which this week featured an article on this topic in response to this question:
Q. I'm a property assessor. Being an expert witness is a good source of income, but if I give fair evaluations no one will hire me. Can I tend to low-ball or high-ball estimates in my testimony?
Rabbi Dr. Asher Meir, of the Business Ethics Center of Jerusalem, answers with examples from Jewish literature concerning the ancient practice of animal sacrifice. An offering had to be perfect, and one needed an expert to tell you if this was the case.

The mishna in tractate Bechorot discusses a person who is an expert in determining when a first-born animal, which is usually dedicated for a sacrifice, becomes unfit for an offering and thus permissible for ordinary use. The mishna states:

One who takes payment for seeing a first-born, it is forbidden to slaughter based on his assessment unless he is a [great] expert like Illa in [the town of] Yavneh, whom the sages permitted to take four isar for each small animal and six for each large one, whether it turned out to be fit or blemished. (1)

The mishna mentions two safeguards. The first is that in normal circumstances we don't permit taking payment for giving a judgment. We are afraid that a person will be tempted to disqualify even fit animals (thus permitting them for consumption) in order to get more business. So an ordinary expert is forbidden to get paid for his evaluation.

But note that there is a second safeguard as well: even in the case of a unique expert, who is allowed to get paid, he must get the same price whether he permits or forbids the animal. The absolute minimum standard is that there shouldn't be any incentive to distort judgment on this particular animal. That still doesn't completely solve the problem because a person who tends to lenient rulings is more likely to get future business, as you have discovered.

Even so, if there is a person of unique expertise and acknowledged judgment, he may be appointed as a designated paid witness. When there is only one great expert, there is no problem of shopping around for one of slanted judgment.

This mishna can help us address the systemic question. First is the question of compensation. At the very least, someone hiring an expert witness should never be allowed to condition any kind of payment on the content of the testimony. Otherwise, we would be sanctioning payment for perjury.

Second is the question of competition. Note that the problem begins with the practice of shopping around for a witness. This practice, while legitimate in itself, leads to perverse incentives for the potential witnesses. If we have a designated witness, appointed by the court itself, this would solve the problem. Such a witness no longer has any incentive to tend to either side in his statements before the court.

I have written before that I believe this idea should be adopted in our legal system. Instead of having each side bring their own witness, there should be some incentive for the sides to agree on one witness, which would strongly favor a professional known for impartiality. Another possibility is for the court to appoint its own expert, which is the closest parallel to Illa of Yavneh.

We all know the tort sytem is broken, and this is due in no small part to the fact that testimony can be purchased, and the "truth" goes to the highest bidder. That is no way to find justice. Somehow, the payment has to be decoupled from the testimony. Frankly, I think my solution is as good as Rabbi Meir's from the Mishna (yes, pretty arrogant of me, I know.) No payment is in the end as good as neutral payment. But without some move in this direction, we will never achieve true tort-reform. Again, as long as testimony can be purchased, it can be bought, and that is a price we can no longer pay in this country.

Wednesday, December 17, 2008

Yes, SR Sucks

Speech recognition (SR, also incorrectly called Voice Recognition) is considered a boon to some (mainly administrators that don't have to use it) and a bane to others (most of the radiologists that DO have to use it).

There is a paucity of information out there on the topic, with most of the reports on and elsewhere being anecdotal, or written by those with an agenda on one side or the other.

From Ann Arbor, Michigan comes an article in the JACR that appears to be both objective and rather derogatory toward SR, and maybe a little bit toward docs as well. Leslie E. Quint, M.D., Douglas J. Quint, M.D., and James D. Myles, Ph.D wanted to

. . .determine the frequency and spectrum of significant dictation errors in finalized radiology reports generated with speech recognition technology.
To this end, they reviewed 265 reports, and found that 206 (78%) were accurate, containing no "significant" errors, but that means that 59 (22%) DID have "significant" errors. Those errors were:

Type of Error

Wrong word(s)-------------31
Nonsense phrase-----------19
Missing word(s)------------16
Wrong image number------9
Wrong date-------------------7
Wrong measurement-------4
Right/left substitution-----4
Missing or added ‘no’-------3
Nonsense date---------------2
Mm/cm substitution-------0


Some might not be impressed, but this really represents an unacceptable number of problem reports. Interestingly enough, the radiology faculty grossly underestimated the report error rate:

with only 8 of 88 rads guessing the error rate between 20 and 30%.

It is apparently a given that SR systems will bollux up a report, and that those poor docs forced to use SR should expect such. So:
The errors reflect a breakdown in the proofreading process, and there are multiple possible causes for this breakdown. Carelessness by the report signer is one possibility.
Personally, I chafe a little at this statement, but in the end, it is the radiologist's responsibility to send out an accurate report. Whining about the SR system (or the transcriptionist, for that matter) doesn't play well in a court of law. But still, if SR is doubling, tripling, quadrupling the number of errors in your reports, it becomes harder and harder to catch them all.

Quint, et. al. conclude:
Carelessness on the part of the editing physician or ill-conceived radiologist incentives (eg, rewarding speed over accuracy) may be partly to blame. Generally, the radiologists surveyed believed that the departmental error rate was much lower than it actually was, and most of the radiologists believed that they personally had lower than average error rates. This lack of awareness of the problem probably contributes to the high error rate. By delineating the frequency and spectrum of errors, we hope to raise awareness of this issue, thus facilitating methods for improvement.
So their point was to make everyone aware of the fact that SR creates lots of errors, and that those who use it need to be doubly vigilant.

I've got a better solution: Yes, I'll proofread carefully, but I'm keeping my human transcriptionists. Which is what I was going to do anyway.

Saturday, December 13, 2008

Canadian Man Builds Robot Girlfriend

Fox News, of all places, tells us about Le Trung,

a 33-year-old software engineer who lives with his parents in Brampton, Ontario, a suburb of Toronto, says he's spent about $20,000 so far on Aiko, a 5-foot-tall female android with clear skin, a slim if shapely figure and a wonderful disposition.

Here's a video of Aiko in action. There are some disturbing moments later in the clip, but Aiko takes care of business nicely:

Trung is quite forthright on a number of issues concerning Aiko:

"Aiko is what happens when science meets beauty," Le Trung tells the Sun of London. "Aiko doesn't need holidays, food or rest, and will work almost 24 hours a day. She is the perfect woman."

She still can't walk, however. That will take a lot more work and, Le Trung tells the Globe and Mail, a new round of funding. He hopes to create and sell more pretty female robots in the future.

But, ahem, is there more than just companionship involved?

"Aiko is still a virgin, AND NO I do not sleep with her," he writes on the Project Aiko Web site, though he admits that she "has sensors in her body including her private parts, and yes even down there."

I'm not sure I wanted to know that, personally. Oh, Brave New World...

The Doctor Dalai Show: "My PACS"

Wednesday, December 10, 2008

Oy Vey! Israel Goes Carestream!

My friend Mike Cannavo, The One and Only PACSMan, usually manages to find me something esoteric for Christmas/Hanukkah. This year, his gift included this set of stocking-hooks for the mantle, tailored for the Jewish taste. (I think this was actually supposed to be the more traditional JOY, and Mike kept the "J" for himself.)

"Oy" technically means "woe" in Yiddish, often used in the statement "oy vey iz mir" – "Oh, woe is me" (Yiddish: אױ װײ'ז מיר). This is a phrase heard at least a hundred times a day within the facilities of Clalit Health Services, the second largest HMO in the world, covering 3.9 million folks in Israel, 54% of its population.
Clalit's facilities and services include 1,400 community clinics, 14 hospitals, 400 pharmacies, dozens of laboratories, research institutes and subsidiaries that provide diagnostic imaging, dentistry, complementary medicine, aesthetic medicine and medical equipment maintenance services. As the largest civil employer in Israel, Clalit has approximately 33,000 employees including physicians, nurses, pharmacists, paramedics, laboratory/imaging technicians and administrative staff.
As an aside, the Clalit web site shows this photo of a nice Jewish doctor, who for some reason is much better looking than me, another nice Jewish doctor:

When you have 5 million exams per year, you really need a PACS, and Clalit just signed on with Carestream to provide RIS, PACS, and central archival. Now, to be accurate, the deal was made with Algotec. In case you didn't know, Algotec is an Israeli company that was bought out by Kodak around 2003 to provide the fifth iteration of Kodak PACS. (Don't even ask about the other four...may they rest in peace.) When Onex Corporation purchased the floundering Eastman Kodak company's Health Group, Algotec came with as fully-owned subsidiary. The new company was called Carestream (a title I have always thought would work better for an entity that serves urologists), and the rest is history.

I suppose it should come as no surprise that the largest Israeli health entity would chose the PACS that is made in Israel. To be honest, I haven't played with an Algotec product since it was, well, an Algotec product, but I was impressed with what I saw at the time. I'm sure Clalit made a good choice. I can hear it now: "PACS, SHMACS. You want a good PACS? We got a deal for you!" Mazel Tov to Carestream!

Dalai Gets Published...In PRINT!

Diagnostic Imaging is well-known to all of us in the field. Better than a "throw-away" and more topical than the hefty scholarly periodicals, it is the one monthly journal I usually read cover-to-cover.

My favorite part of DI is the Backscatter column (which is for some reason on the back page of the magazine), written by Brad Tipler, M.D., a private-practice rad from Virginia. His tongue-in-cheek commentary is usually right on target, but with a proper dose of sarcasm and cynicism. Over a year ago, Dr. Tipler wrote about "TIBS", Tipler's Irritable Body Syndrome (see the article here), and for some reason, it reminded my of my old "X-Ray Man" song from 2006 (original post here). On a whim, I sent the song to Dr. Tipler, who forwarded it to his editors. They too liked it, and promised to publish it in the RSNA edition of 2007. Well, things happen, and editors change. A new editor found the note in the email droppings of someone departed, and the ball finally rolled into my court with publication in the December 2008 issue.

I'm not really sure where the "came in a flash" title originated, but it's fairly accurate. I was indeed on call at our busiest site (although the time was closer to 11 PM than 2 AM, and the words did indeed flow pretty quickly. Please rest assured that there was no demented patient in earshot at the time this was written, although based on the PACS traffic, there were quite a few folks in the mood for a malady.

Today DI, tomorrow, the Yellow Journal! actually have to do research and write a real paper for that one. Never mind....

Friday, December 05, 2008

Doctor ...a short story is a great site for those who love medical technology. Once a year, however, they branch off into realm of medical science fiction, sponsoring a short story (250-2500 words) contest limited to this rather small literary niche.

While some of my readers would probably disagree, I don't post fiction here, and I had never really tried my hand at it...until now. I've posted my feeble effort below. Obviously, it didn't win the contest, but I had some fun with it anyway. By the way, this is in no way autobiographical or anything else. I was mainly experimenting with telling a story using the fewest words possible. Try not to laugh too hard....


Doctor was the last. His implants had nearly lost their cohesion to his nervous system, the end point to his existence. But the occasional impulse did cross from the organic to the non, and Doctor made do with that.

The child in the tattered unisuit tugged at his wrist. "Doctor? Doctor?" she whimpered. He yanked his arm away, servos screaming.

"What do you want, urchin?"

"Please, Doctor! I need you....I need you..." She looked up, pleading, seeing her reflection in his face.

"Leave me, urchin. I can't help you. I can't help anyone. I never could." He started off again down the deserted street, trying not to see....anything.

"But, Doctor, Doctor, Please..."

From an long-unused lattice within his crystalline backup memory, an image insinuated into his visual. The time-stamp read "1 March, 2063," years before he had been augmented. He saw a child, holding his hand, that of flesh, smiling up at him. He shook his head out of instinct, trying to banish the pic back to silicon, but it had already imprinted upon his consciousness. His breath would have caught, if he still had it. The child. His patient. Lost. Mere protein constructs and humours could not see what was needed. Simple tissue had not the speed or the precision to save her. So he evolved.

What God saw as perfection, he improved. Polymer lenses superseded gelatin. Sensors tuned to spectral extremes replaced the function of the spider web of rods and cones. Tendonous and osseous yielded to steel. Actin and myosin and adenosine triphosphate to servo and actuator and fusion-cell. Cortex interfaced with doped metals. He was more. Oh, yes, so much more. He was the first, the best. He was ... Doctor.

Others changed, too. But they didn't. So much of them was replaced, they became what they already were. There were not like him. They were less. They were not Doctor. Their software reverted to self-serving infinite loops. The program was abandonded. And so was Doctor. He was the last.

"Doctor? Can you come with me?" The old image faded, replaced by the earnest features at his side.

"All right, urchin, all right." He modulated the impatience and intransigence out of his audio transducers, and hoped she wouldn't notice. "I'll help you."

She took his actuator in her hand, and led him off into the ruins of the city.