Where are the electronic health record savings?

By Charles S. Clark

January 15, 2013

The belief that health care costs can be trimmed if more medical practitioners switch to electronic record-keeping has suffered a blow with the release of a RAND Corp. study finding that such savings have yet to materialize.

The conclusion adds to challenges confronting the Health and Human Services Department as it implements the still-controversial 2010 Affordable Care Act.

In the January issue of Health Affairs, two RAND analysts updated a 2005 study that held out hope for saving $81 billion a year through electronic health record and information technology efficiencies.

“Despite wide investments nationally in electronic medical records and related tools, the cost-saving promise of health information technology has not been reached because the systems deployed are neither interconnected nor easy to use,” the authors concluded in a paper titled, “What It Will Take to Achieve the As-Yet-Unfulfilled Promises of Health Information Technology.”

Arthur Kellermann, a RAND policy analyst, and Spencer S. Jones, a RAND information scientist, said digitization of patient medical and billing records has produced “mixed results” while annual health care expenditures have risen by $800 billion.

“The disappointing performance of health IT to date,” they wrote, “can be largely attributed to several factors: sluggish adoption of health IT systems, coupled with the choice of systems that are neither interoperable nor easy to use; and the failure of health care providers and institutions to reengineer care processes to reap the full benefits of health IT.”

The original promise of health IT “can be met if the systems are redesigned to address these flaws by creating more-standardized systems that are easier to use, are truly interoperable, and afford patients more access to and control over their health data,” Kellermann and Jones said. “Providers must do their part by reengineering care processes to take full advantage of efficiencies offered by health IT, in the context of redesigned payment models that favor value over volume.”

The analysts stressed that health information must be retrievable by others, including health professionals from separate health care systems, that patients much have easy access to the records, and that system designs must be “intuitive, so they can be used by busy health care providers without extensive training.”

A spokesman for HHS’s Office of the National Coordinator for Health Information Technology said the report showed how much progress has been made in implementing the technology, although more work is needed to realize the full promise. “Health IT is just one tool that will help in improving how we pay for health care,” he told Government Executive. “We are well along in the journey to put modern information in the hands of clinicians, many of whom already recognize the power of health IT to transform patient care as it is delivered today.”

Dr. David Blumenthal, a former HHS official who advocated including electronic health record requirements in the Affordable Care Act while he was at the agency, said there still is strong evidence that electronic records can contribute to improved care and greater efficiency. But the systems in place do not always work in ways that help achieve those benefits, according to Blumenthal, now president of the health nonprofit called the Commonwealth Fund. “Technology is only a tool. Like any tool, it can be used well or poorly,” he told The New York Times.

On Tuesday, a Washington Post editorial discussing the RAND study noted that the 2009 Recovery Act included $27 billion to incentivize providers to embrace digital health records, and yet some evidence shows that health systems that converted have actually increased spending. “Health care still runs overwhelmingly on the fee-for-service principle,” the Post wrote, “which means that the more doctors and hospitals do, the more they get paid. Digitizing that system may just reinforce it.”

Still, the study is not a big setback for HHS, said Jack Meyer, managing principal at Health Management Associates, who consults for states setting up health insurance exchanges. “It’s a yellow light, a sobering note, but it doesn’t mean we should all go back to being Luddites.”

The primary reason to convert from “the paper chase to an electronic system is that it’s better for patient safety,” he said. While cost control is important, digitation helps avoid medical errors, “which can save injuries and lives.”

Under the old paper system, Meyer said, a tired doctor writing a prescription late at night could misplace a decimal point on the milligram dosage for, say, a painkiller for an infant. The result could -- and has been -- fatal. But electronic systems, which have been around since the mid-1970s, he said, have a “software intercept” that would use existing data on the patient’s characteristics and remind the doctor that he has probably mistyped his prescription.

“The study is a reminder that this isn’t going to be as easy as we thought,” Meyer said. “But the Center for Medicare and Medicaid Services is trying real hard, and may need to redouble the effort.”

By Charles S. Clark

January 15, 2013