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January 28, 2009 


Can E-Medical Records Help Reduce Healthcare Costs?

When President Obama signed the American Recovery and Reinvestment Act of 2009 (ARRA) almost a year ago, healthcare industry experts hailed the portion providing $19 billion in government incentives to accelerate the adoption of electronic medical records (EMRs). Supporters touted the measure as a means of saving the U.S. healthcare system up to $100 billion a year with widespread conversion. However, recent evidence presents a different picture of the benefits of EMR adoption, and now further analysis is being undertaken to determine the actual effects on cost and quality of care.

The benefits to EMR adoption are evident, although to what extent they can affect overall healthcare costs is still yet to be determined. Converting from traditional information methods to an EMR-based system can reduce medical errors, enhance access, eliminate redundant testing, allow for better measurement of quality, improve efficiency, and augment clinical care. But while such measures can control claims costs and in the process minimize premium increases, EMRs in their current form may not have the financial impact that supporters and policy makers are expecting.

A recent study by the Center for Studying Health System Change  found that current commercial EMRs are better for billing and documentation than they are for improving coordination of medical care – which is where the potential for healthcare savings is more prominent. According to the research, current EMR design is driven by clinical documentation needs as they relate to billing rather than patient and provider needs in relation to clinical management. Current designs also make it more difficult to communicate and exchange patient data across physician practices and different care settings.

Another study comparing 3,000 hospitals at various stages of EMR adoption found little difference in the cost and quality of care, but more as a result of the hospitals’ lack of effective use. According to author Dr. Ashish K. Jha, the way hospitals are currently using the technology is having a marginal effect on quality or cost, and until more focus is directed toward education, the true benefits of EMR adoption may not be realized.

With only 20% of physician’s offices across the U.S. fully integrating EMR systems into their practices, the road to widespread adoption continues to be an uphill battle. Further government incentives and other measures through anticipated healthcare reform could increase the adoption rate, but if concerns about integrating and standardizing EMR systems as well as educating on proper usage are not addressed, the immediate return in terms of improving cost and quality of care may not live up to earlier expectations. Thus, if market demand is impeded by these limitations, it may be some time until we can fully evaluate EMRs true impact on healthcare costs.

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hcw_eyes_graphic-edited for eloqua 11-09


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