Thursday, December 23, 2010

Cost Estimates for EMRs

 

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eWeek.com today has a story about the true cost of EMR installation in the first year of acquisition.

In a new report, CDW Healthcare estimates initial revenue losses for physician practices due to EHR costs, but predicts monetary gains upon completion of training.   Adoption of an EHR (electronic health record) application could cost a physician $120,000 in one year, CDW Healthcare reports in its Physician Practice EHR Price Tag study.

Training of physicians on EHR platforms during the adoption period will lead to a 10 percent average loss in patient appointments in the first year of use, but then productivity should pick up, CDW reports in its survey of 200 physician practices over a six-month period.

By using EHRs to speed up their workflow, physicians will be able to see 15 percent more patients and gain about $150,000 in annual revenue when EHR platforms are fully implemented, according to CDW.

Although 66 percent of respondents mentioned hardware and software costs as their main concerns in EHR adoption, these areas comprise only 12 percent of total EHR adoption costs. A more significant cost factor was a loss in revenue due a workflow slowdown.

On average, physicians in the survey expected a 10 percent loss in workflow during the first year, but 40 percent of respondents predicted that patient visits would fall by 25 percent or more in year one.

To minimize the potential reduction in productivity during the transition to EHRs, Karl advises that physician practices invest heavily in training. "Move as quickly as possible to bring your staff up to speed," he said. "The longer you take to adopt, the longer your productivity suffers and the greater the cost over time," he explained.

In the Dec. 13 report, CDW also highlighted the potential benefits of cloud computing in EHR implementation. Of the respondents, 38 percent were considering cloud computing, which would cut $4,400 from the costs of hardware, software, services, telecom and data center environment (power and cooling) per physician.

 

Placing this in the framework of the promised incentive of up to 44,000 per physician for meaningful use of an EMR still nets out a significant loss to physician business’ bottom line.

 

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