Hope vs. hype in healthcare information technology

Analytics professionals turn data into useful information. We understand, and perhaps take for granted, that we rely upon a capable, comprehensive information technology infrastructure, as well as business processes for capturing critical data that we then analyze, model and report. But what if you worked in an industry where critical information regarding core operations was still being recorded and stored on paper?

Walk into any physicians’ office in the United States and you will probably see massive file cabinets stuffed with patients’ medical files. It does not need to be this way – over the last 40 years, healthcare information technology vendors have sought to replace paper files with digital records. Numerous electronic health record (EHR) systems are available, both from recent start-ups and from firms tracing back to the 1980s. EHRs capture every aspect of doctor-patient encounters, including health histories, exam findings, test results, medications, referrals to specialists and hospitalizations. They are integrated with systems to schedule appointments, generate insurance claims and patient bills, and, in larger clinics, interface with clinical and financial decision support systems that enable administrators to analyze, understand and manage physician effectiveness, productivity and profitability.

Unfortunately, clinics and physician practices have been slow to adopt EHRs. The situation at hospitals is not much better: A 2009 article published in The New England Journal of Medicine reported the results of a broad based survey of U.S. hospitals commissioned by the Office of the National Coordinator for Health Information Technology, part of the U.S. Department of Health and Human Services [1]. Only 1.5 percent of hospitals had a full-fledged EHR system across all departments, while 7.6 percent had a basic system in at least one department. Certain functions were more widespread: 17 percent had computerized order-entry for medications, an important EHR component. Adoption was more common in larger urban hospitals and academic medical centers, but even there, progress has been slow.

How can EHRs help healthcare providers and patients? A broad consensus of health policy experts, industry leaders and IT professionals agree: Widespread adoption of this technology ought to improve the quality of patient care while making the U.S. healthcare system more affordable. Patient care is improved when records are more complete and accurate and easier to access during scheduled visits or a medical emergency. When patients are seriously ill, EHRs address all-too-common problems such as multiple specialists ordering duplicate tests or prescribing medications that cause dangerous interactions. Finally, a digital database of health records is a must-have for rapid, accurate analyses of treatment effectiveness, efficiency and cost.

How widespread is this consensus? When the federal government enacted the economic stimulus bill known as the American Recovery and Reinvestment Act of 2009, it became a focal point for great political controversy. However, one program won near-universal bipartisan support: $27 billion in payments to clinical professionals and hospitals that “adopt, implement, upgrade or demonstrate meaningful use” of EHR technology. The enabling legislation, the Health Information Technology for Economic and Clinical Health Act (HITECH Act), provides physicians and hospitals with financial incentives if they successfully implement EHRs: up to $44,000 per physician over five years under the Medicare program and almost $64,000 per physician over six years under the Medicaid program. More ominously, penalties for failing to successfully implement EHRs by 2015 include reduced payments from both Medicare and Medicaid.

From my vantage point as an analytics expert who helps hospitals implement sophisticated financial planning and budgeting systems, I endorse the goals of the HITECH Act. However, I have serious reservations about whether the program is going to succeed in achieving those goals at a reasonable cost. Here are a few of those concerns:

1. EHR technology is expensive. An EHR at a typical community hospital costs tens of millions of dollars, including software, hardware, implementation consulting, IT infrastructure for greater reliability and security, conversion of paper records, plus training every single patient-facing employee and medical professional. At multi-hospital health systems, EHRs cost hundreds of millions of dollars. Recently, the CFO of a major academic medical system remarked that the full cost of their EHR implementation would be “at least” $500 million over five years, even after taking subsidies into account. He also noted there was little chance this investment would produce a positive financial return for the foreseeable future.

2. Hospitals may not have the money. Hospitals are cash-starved organizations. The American Hospital Association has reported that for 2010, average operating margins were only about 4 percent, and more than 30 percent of hospitals lost money. Despite HITECH subsidies, many hospitals will struggle to fund EHR projects, and they will face even greater hardship coping with penalties for failure to adopt. This added pressure may force financially strapped community hospitals to either close their doors or be acquired by for-profit healthcare companies, changing the face of health care in towns and cities across the country.

3. What other projects get postponed? Tight money also means that hospitals are already struggling to repair or replace aging facilities and update older, less capable medical technology. Massive EHR spending will force these projects to the back of the line, which will take a toll on both health outcomes and operating efficiency. Thanks to HITECH, hospitals have little choice about the timing of their EHR investment, even if other needs are truly more pressing.

4. EHR technology is difficult to implement. Current EHRs are far from simple and intuitive to use. An EHR touches everyone in the hospital: doctors, nurses, clerks, receptionists, lab technicians, dieticians, pharmacists and so on. All must learn how to use the EHR and must adapt how they work to fit the new technology, while continuing to provide patient care. Organizational changes are required for IT security and patient privacy. And massive upgrades of overtaxed, underfunded IT systems are a given. In organizations that have already implemented EHRs, cost overruns and delays measured in years are frequent.

5. The rules for EHR incentives are complex. The subsidy program is run by the Centers for Medicare & Medicaid Services (CMS). Like the Medicare & Medicaid programs, the rules are numerous, constantly evolving and subject to potential fraud and abuse. Hospitals have understandable uncertainty regarding the definition of “meaningful use” and how it will be applied in determining eligibility for subsidy payments or penalties.

6. Too much, too fast? To receive full incentives and avoid penalties, hospitals must have started in 2011 and must finish by 2015. This has caused a mass rush to implement EHRs at break-neck pace. There are approximately 6,000 hospitals in the United States and tens of thousands of physician offices. Can healthcare providers handle the disruption and expense without sacrificing current service levels? Can vendors and service providers really support all this with skill, care and efficiency? And will those same vendors extract pricing premiums because hospitals cannot afford to wait?

7. Where is the evidence? The medical profession prides itself on decisions based on sound scientific evidence of effectiveness. But the EHR research literature paints no clear picture of what works or why [2]. Some evidence suggests that healthcare IT can have serious adverse impacts. A recent report from the Institute of Medicine on Health IT and Patient Safety argues that poorly implemented systems create significant risk of patient harm [3]. For example, badly designed order entry systems have caused doctors to order the wrong medication or exceed dosage limits. Like any new technology, the benefits do not come without risks, costs and difficulties, many of which we are only beginning to understand.

Will healthcare IT improve our health system? I hope so. But this is still an evolving technology. By moving too quickly, we lose our ability to learn from and build on early successes. The result will be costly mistakes and lost opportunities to improve the quality and quantity of care we deliver. A more measured rate of change is going to avoid waste and will ultimately achieve the promise of better care at lower cost.

REFERENCES

1. A.K. Jha, et. al, 2009, “Use of Electronic Health Records in U.S. Hospitals,” New England Journal of Medicine, Vol. 360, pp. 1,628-1,638.
2. www.ncbi.nlm.nih.gov/pubmed/17951106
3. www.iom.edu/Reports/2011/Health-IT-and-Patient-Safety-Building-Safer-Systems-for-Better-Care.aspx