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Sunday, March 17, 2013

EHRs Lose Money for 1/4th of Physicians, Study Says

 

Medscape, an online service for physicians offers continuing medical education and presents the results of many studies in medicine.

Medscape reported the following from  a study published online today in the journal Health Affairs.

Attribution is given to the authors who produced the information in this report.

Lead author Julia Adler-Milstein, PhD, an assistant professor at the University of Michigan, and coauthors projected the average physician to lose $43,743 over 5 years and only 27% of practices to achieve a positive return on investment (ROI). That percentage of in-the-black practices would increase to 41% if they received $44,000 in meaningful-use incentive payments over 5 years.

The good news in the otherwise discouraging report is that practices achieving a positive ROI did so in part by using their EHRs to significantly boost their revenue.

Dr. Adler-Milstein and coauthors based their findings on a survey of 49 practices in a large EHR pilot program called the Massachusetts eHealth Collaborative (MEC), organized by the American College of Physicians and the Massachusetts Medical Society. MEC paid for the EHRs and the consultants who helped the practices implement the technology from March 2006 through December 2007.

The study did reveal differences in the return on investment between very small practices and those with six or more providers using EMR.

The elimination of paper records coupled with change management in the practice combined to offset some of the investment in EMR.

The figures varied substantially as to ROI and the time to running in the black. Although the average physician was expected to lose $43,743 over 5 years, the damage was not as bad for physicians in primary care, who lost $29,349 compared with $50,722 for specialists. Unlike smaller practices, groups with 6 or more physicians posted a positive though meager ROI — an average of $2205.

Julia Adler-Milstein

Dr. Adler-Milstein and coauthors write that an investment in an EHR system may not pay off for practices who fail "to make the operational changes required to realize benefits."

Even more significantly, the 13 practices with positive ROIs averaged $114,613 in additional revenue attributable to their new EHR systems compared with only $9204 for the 36 practices with negative ROIs. Five of the practices with positive ROIs reported that their EHRs allowed them to see more patients per day. And 9 practices boosted revenue through improved billing. Their EHR systems produced more error-free claims, resulting in fewer rejections. Plus, the technology allowed physicians to more accurately code their work, which solved the problem of undercoding and led to higher reimbursement.

However, the study authors note that revenue gains based on more accurate coding highlight "the potential misalignment between optimal provider use of EHRs and the savings that policymakers hope will result from greater EHR adoption, underscoring the recent concern about the potential for EHRs to drive up healthcare costs."

This occurrence would fly in the face of attempts to decrease cost based upon procedural coding, not outcomes, nor quality of care.

The authors write that more small practices might recoup their investment on EHRs and then some if the federal government increases the size of meaningful-use incentive payments. However, a "more compelling approach" would be to pursue policies that reduce the cost of EHR adoption and increase its benefits. Encouraging small groups to join larger ones could shrink adoption costs through economies of scale. And more practices could learn how to reorganize their operations to exploit EHR technology if the government increased funding for so-called regional extension centers that help with implementation.  This however would introduce complexity into management of a practice. It also involves merging differing corporate cultures, which can doom mergers. Increasing practice size may financially seem desirable, negative offsets can cancel out other gains.

Coauthor David Bates, MD, MPH, reported serving on 2 advisory groups for the federal Office of the National Coordinator for Health Information Technology and having financial relationships with a number of medical device and information technology firms. The other coauthors have disclosed no relevant financial relationships.

Health Aff. 2013;32:562-570. Abstract

 

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