(December 23, 2015, The OC Register) Randy Saad once spent his weekends poring over logs of patient data at home, searching for flaws in hospital protocol. Though labor-intensive, it was the only way he could identify potentially problematic patterns.
“It would take a complaint to bring attention to a process,” said Saad, the senior director of perioperative services at White Memorial Medical Center in Los Angeles.
Now Saad’s weekends of slogging through records are a thing of the past. With the click of a mouse, he can create reports on the efficiency of outpatient or inpatient procedures, and sort them by physician. All of this requires little or no extra work for his staff.
The system that has made Saad’s life easier is from an early stage tech company in Irvine called Tagnos, which uses lightweight tags, sensors, analytics and a proprietary database to pinpoint and display a patient’s location in the hospital. It can be installed hospitalwide or in targeted departments.
After installing Tagnos technology in 2007, White Memorial realized “immediate benefits,”Saad’s said. The system has enabled him to reduce staffing costs by reassigning workers to busier shifts, thus saving the hospital $500,000 annually and making patients happier by ensuring they are seen quickly.
It also has increased the number of procedures the hospital is able to perform.
Tagnos tracks patients from the moment they walk in the hospital doors. Staff members put a tag on patients, and the Tagnos system does the rest. Sensors track whether a patient is in the waiting room, is in a changing room or is being seen by a doctor.
At the end of the patient’s hospital stay, the tag is returned to a bin, where it is sanitized before being reused by another patient.
Tagnos is the brainchild of Neeraj Bhavani, the company’s founder and CEO. With more than 20 years of work experience in health care, Bhavani knew his clients and what they needed. But timing became a crucial factor in the company’s success.
Bhavani originally thought of the concept in 2005, but his idea was too advanced for the existing technology at the time.
Sensors for patients were bulky, expensive and impractical. The $25 tags were about the size of a pager, and caring for them was time intensive. At one point, a staff member at White Memorial had to change the batteries each night.
But by 2010, when the company launched in earnest, the tags had become inexpensive commodities. They cost only $3 each and weighed less than a house key. Now some patient tags cost as little as 50 cents and don’t require batteries.
Initially, Bhavani envisioned his product as an asset tracker. His experience in health care taught him that large, expensive pieces of equipment routinely go missing in hospitals, and staff members often are unaware of where they are or whether they’re in use. And sometimes equipment is stolen.
But in his interactions with clients, Bhavani learned that hospital administrators were more interested in tracking people than things, so his nascent company pivoted. Instead of focusing solely on equipment, Bhavani built a system that also could track patients, ensuring no one slipped through the cracks unseen by nurses or doctors.
With that shift, Tagnos moved to lightweight wristbands for patients, equipped with microchips. Larger sensors placed throughout designated areas or departments track patients and equipment by picking up a signal from the wristbands, or tags, then relaying their location to the Tagnos database.
The database tells staff how long patients have been in the waiting room or in a hospital room awaiting a doctor’s attention.
Through Tagnos, family members can receive text messages when their relative is ready to be picked up, or they can consult a patient board on a wall in the hospital to see where their family member is in the process. The board displays numbers assigned to each patient, rather than their names, to ensure privacy.
That kind of flexibility is crucial to a budding company’s success, said Richard Sudek, executive director of the Institute for Innovation in Irvine, who also sits on the EvoNexus committee that selects startups for admission to the incubator program.
“Being adaptable is extremely important,” Sudek said. “Unless you’ve done deep work with a customer base and the product, there are going to be things that change.”
Sudek is also chairman emeritus of Tech Coast Angels, the largest angel investor group in the country. He said there are some traits investors look for when deciding which companies, and entrepreneurs, to invest in.
“You want someone that’s open minded, that’s coachable, that’s adaptable, but someone that has a plan,” Sudek said. “You want to look for entrepreneurs that want to win, not those that want to be right.”
Bhavani wanted to win.
“We always had this vision that we wanted to build a more comprehensive platform,” Bhavani said. “To a certain extent, we pivoted or were flexible with the business plan, and that’s important. But too much pivoting isn’t good.”
In 2013, timing again would work to the company’s advantage. The Affordable Care Act changed how Medicare compensates hospitals, basing payment partially on patient satisfaction and the quality of their care.
Under the new policy, which started in fiscal 2013, Medicare would withhold 1 percent of its reimbursements to hospitals and use it to create a fund to award hospitals for the quality of their care – 30 percent of which was based on the results of patient satisfaction surveys, according to the Society of Hospital Medicine.
That prodded hospitals to up their game to ensure patients were happy – a change in priorities that meshed perfectly with Bhavani’s new product.
“We were just doing the right thing, but eventually the market drivers came along and now the reimbursements are tied to it as well,” Bhavani said.
In May of this year, Tagnos moved into the EvoNexus Irvine location, one of eight companies admitted to the incubator’s second cohort. Because the incubator doesn’t charge rent, Bhavani didn’t have to worry about spending money on an office while he was frequently traveling to see clients across the country.
The benefits of being in an incubator would be instrumental to his company’s success. Having a space in EvoNexus granted him access to mentors with connections to potential clients. Through EvoNexus, Bhavani connected with Cisco’s Entrepreneurs in Residence program.
Because it is powered by big data and analytics, Tagnos appealed to the IT giant.
In September, Tagnos was admitted to the Cisco incubator. It pays for Bhavani’s travel expenses, connects him to other potential clients, sets up meetings with Cisco business units and gives him office space in Silicon Valley.
Bhavani now splits his time between Orange County and San Jose.
Tagnos has four clients in California, and four more deals nationwide are in the works. And Bhavani is mulling the expansion of Tagnos’ technology into other industries, including manufacturing, retail, transportation and fleet management.
That move could come as early as the first quarter of next year.
“I’m very focused on adding more customers and adding a strong income statement,” Bhavani said. “We will probably be at that point by early next year. At that point, the opportunity to grow – there’s no limit.”
