Health IT Savings Are Not Hype

The federal government has a lot riding on health IT. Government agencies have claimed that adopting technology systems, such as EHRs, can save our healthcare system nearly $100 billion annually. Moreover, the government has dedicated billions of taxpayer dollars toward motivating healthcare providers to adopt these tools.

Well, a recent article in the Wall Street Journal says these promises of health IT cost savings are nothing but hype. The authors of the article, Stephen Soumerai and Ross Koppel, base this assessment on studies by a series of well-respected institutions such as McMaster University, Regenstrief, and the Indiana University School of Medicine. I’m sure these studies are educationally sound — comprehensive, random, and controlled. However, in this editor’s opinion, they’re pointless — at least at this stage of the game. As I’ve said before, studying the impact of IT on the entire healthcare industry today is like studying the impact of the airplane on the travel industry based only on the Wright Brothers’ plane.

The cost savings envisioned by the government is based on a fully digitized and connected healthcare system that leverages a full array of decision support and business intelligence tools. Currently, most of the industry is still struggling to implement the first piece of the puzzle — EHR software.

Furthermore, Health IT was never pitched as a “magic pill” that providers would adopt and suddenly everything would be hunky-dory. As we all know, technology doesn’t work that way. Even the greatest technologies of our time are useless if they’re not implemented and leveraged properly. And unfortunately, that’s where most of the healthcare industry currently stands with its adoption of health IT. Providers are implementing EHRs, but most are not using them effectively. This is partly due to poor planning, improper motivation (i.e. implementing EHRs simply to capitalize on incentive dollars rather than to address a business problem), and yes, the technology itself.

That’s one point I agree with Soumerai and Ross on. Much of the EHR technology in use today is “generally clunky, frustrating, user-unfriendly, and inefficient.” This is indicative of a technology in its infancy. But, they’re not all bad. There are a handful of robust EHRs on the market, and several others that show a great deal of promise. I think a big problem our industry faces is that with Meaningful Use, the federal government is essentially motivating mass adoption of a technology that is not yet mature. However, without this type of financial motivation, who knows how many years it would take for EHR technology to reach maturity? With the economically crippling cost of healthcare, perhaps the federal government felt it had to force the issue.

While the healthcare industry will no doubt experience growing pains as a result of the government’s health IT push, I, unlike Soumerai and Koppel, do not believe this initiative is based on hype. When dealing with a technology in its infancy, I prefer to focus my attention on those trailblazers who are using the technology effectively, rather than the masses who are not. I interview healthcare providers every day who are getting true value from their EHR (and other health IT) investments. Through these interviews, there is no doubt in my mind that the savings to be gained from health IT are very real.  Some of these savings can be traced back to a hard ROI, but most are more difficult to calculate, yet much more powerful in the long run.

Here are just a few cases in point:

  • Through use of EHR software, ENT Specialists of Northwestern Pennsylvania, an eight-physician practice located in Erie, PA, was able to increase overall patient volumes by 3.6% due to increased physician productivity and efficiency. The EHR system essentially enabled every physician in the practice to see and bill more patients, which resulted in a 32% increase in revenue for the practice.
  • MultiCare Health System has documented the following measurable results from its EHR implementation:
    • 72 adverse drug reactions avoided in the first 2.5 months of CPOE
    • A 30% reduction in transcription volumes
    • Average length of stay dropped 3.35% from 4.28 to 4.14 days
    • Net accounts receivable (AR) days improved from 51.6 to 46.6
    • Average operating margin increased from 4.2% to 8.8% in the first three years after implementation.
    • Average medication error rate decreased by an average of 26.5% across four MultiCare hospitals
  • Dr. Tom Deas, gastroenterologist for North Texas Specialty Physicians touts the life-saving power the EHR and HIE system in use by his physicians group saying, “Patients come into my office all of the time that forget some of the medications they are taking. Recently, I was ready to schedule a colonoscopy for a patient that neglected to tell me she was on Warfarin, an anticoagulant. I was notified of this prescription via the CCD I received from the HIE, and it made a huge difference in how I managed that decision.”

The potential ROI for practices and hospitals are pretty straightforward in the ENT Specialists example, as well as in the AR days and margin metrics from MultiCare. However, I realize that these don’t necessarily equate to savings for the healthcare system. These savings are more likely to come from the 72 adverse drug reactions that MultiCare prevented because of its EHR, or its 3.35% reduction in length of stay. They will also come from doctors using these solutions to prevent potential complications that can turn into costly hospital visits, much like Dr. Deas did when he used an EHR to identify that his patient was on a drug that could complicate her colonoscopy.

In these instances, EHRs are helping the healthcare system avoid costs that it would normally incur if the technology was not used — and these costs are not insignificant. For example, complications from medication errors and adverse drug reactions can result in hospital stays that cost the healthcare system hundreds of thousands of dollars per patient. In many instances, these complications end in death. Ultimately, the insight health IT provides leads to prevention, which not only eliminates costs, but has a profound impact on patient care. But tell me, exactly how would these savings have been calculated or measured in the studies referenced by Soumerai and Koppel? My guess is they weren’t considered at all.

Source:Healthcaretechnology

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5 thoughts on “Health IT Savings Are Not Hype

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