At Kindred, Chapman says he's on a mission to cut infrastructure costs so that he can reinvest the savings in "frontline business initiatives, like application development." This newfound agility, as he calls it, will give IT more credibility and help grow the business. He says he hasn't calculated a traditional ROI for his VTL investments; it was a "no-brainer" to invest in the technology to maintain the timeliness of data backup and recovery.

But Chapman is well aware of the value that can be generated through easy access to data. For example, he invested in data warehouse analytic tools that help Kindred take advantage of its wealth of historical data (such as patient, billing and financial information) for business analysis. Users can "scan this massive data and convert it into actionable information to deal with a business issue," Chapman says. The value derived from crunching the numbers pays for the cost of storing the data.

Two years ago, the Centers for Medicare and Medicaid Services proposed a rate restructuring and reimbursement plan for long-term-care hospitals that Chapman says was "very onerous." Kindred Healthcare and other similar organizations had 60 to 90 days to react to the new regulations and give their input on why this was or—in Kindred's view—was not a good plan.

"In a couple of days, working with our reimbursement departments, we could model that new reimbursement [plan], apply it to the entire previous year's activity in the hospital division and come out with what the impact would be," Chapman says. That information was given to Kindred's government relations representative, who used it in testimony before the House Ways and Means Committee.

In the end, MedPAC's proposal was altered, saving Kindred approximately half of what would have been "a giant cut" in the company's reimbursement from Medicare, Chapman says. "Not every example is as dramatic as that one was, but it's that kind of direct 'connect the dots' to an outcome that affects the bottom line of the company."