Electronic Medical Records: Do They Reduce Healthcare Costs

Posted by John Patrick on

Electronic Medical Record (EMR)

The New York Times published a story in January 2013 titled “In Second Look, Few Savings From Digital Health Records” (see Electronic Records Systems Have Not Reduced Health Costs).  The article suggested that a prestigious study that forecasted significant savings from EMR’s was funded by companies that provide EMR software and services. Now, the same prestigious study group is saying that savings have not been realized. Some of my friends have asked what I thought of the assertions in the article, so I will use this post to offer some brief non-scholarly comments.

The Obama administration and the Bush administration before it believed that electronic medical records could provide many benefits for patients and healthcare providers. Policymakers developing the health care reform legislation recognized that EMR benefits would materialize only if the EMRs were used in a meaningful way. The policymakers developed a set of standards defined by the Centers for Medicare & Medicaid Services (CMS), called “meaningful use“. Significant financial incentives were offered to healthcare providers who met the meaningful use criteria. For example, even a small hospital could earn millions of dollars if they met the meaningful use targets by a certain date. Any responsible healthcare executive would meet with his or her team and make it clear that achieving meaningful use should be top priority. If the team developed the comprehensive planning needed to ensure optimum implementation and maximum savings but missed the target date specified for meaningful use incentives to be  earned, they would be leaving a lot of money on the table. Another way to say it is that the government incentives achieved unintended consequences.

Let’s assume that the New York Times article is correct in that the forecasted savings were not achieved. Does that mean that meaningful use was a bad idea? Should the government have looked the other way while healthcare providers continued to drag their feet in moving to electronic medical records? I say no to both of these questions. Large numbers of providers now have EMR systems and the well-managed providers will refine and optimize their implementation for the benefit of patients and the ultimate reduction in healthcare costs. In spite of the unintended consequences of missing the study group forecasts, momentum toward electronic medical records has been achieved. It makes no sense to continue to have the majority of medication prescriptions being scribbled illegibly on a piece of paper and thousands of people dying due to medication errors. It makes no sense to be referred to a specialist and when you arrive you are presented with a clipboard instead of collaboration between providers. Then the specialist asks, “how can I help you?” He doesn’t know? It makes no sense for heart failure patients to be discharged from the hospital and left adrift with new prescriptions they don’t understand and no follow-up across the continuum of care to minimize the odds of a readmission to the hospital. EMRs address these issues and many more. I am confident that meaningful use will become more meaningful in the months ahead.

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