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CEO of healthcare group still hopeful IT will save employers money

Lake Geneva, Wis. - Employers who are looking for health information technology to have a moderating influence on healthcare premiums will have to wait a while longer, according to the head of an influential health information management organization.

Stephen Lieber, president and CEO of the Healthcare Information and Management Systems Society, said implementing electronic health records and improving interoperability between facilities remain high IT priorities, but adoption rates in the United States remain low compared to those in Europe - in part because provider benefits are not readily apparent.

Lieber was the keynote speaker at the fall technology conference of three Midwestern HIMSS chapters. The event, which was held at the Grand Geneva Resort, attracted IT vendors from throughout the area who displayed a range of products designed to increase efficiency in clinic operations, improve safety in the administration of medicine, and establish electronic health records.

Now all they need is a few more buyers.

Lieber said there is clear recognition that IT has the ability to moderate costs, and there are examples, most of which have occurred in micro settings, to illustrate it. However, less than 15 percent of American physicians have practices that are fully automated, and less than 15 percent of U.S. hospitals have deployed computerized physician order entry.
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"The challenge here is that IT, alone, is not the only thing that's either going to drive costs down or is a factor in driving costs up to a degree, because, certainly, IT adoption is expensive," he said. "So the short answer is yes, I'm hopeful that IT adoption will do the things that it needs to do in order to address costs, but there are so many other factors."

Paying the price

In recent years, those factors have sparked double digit premium increases, which in turn have prompted employers to ask workers to contribute more for their health insurance in the form of higher co-pays. A select few employers actually have kept costs increases at just above the rate on inflation through sound practice management and wellness programs that encourage employees to adopt better health habits and drive down the cost of utilization.

Many believe information technology, when deployed across the entire spectrum of healthcare, will be a force multiplier. But other sectors of the economy have invested a much greater percentage of their revenues in IT than healthcare. Information technology investment in the U.S. healthcare industry now totals $1.1 billion in ambulatory care settings, which represents less than one percent of total revenues in that sphere, and $23 billion in acute care settings, which is about four percent of revenues in that category.

One of the key reasons for low adoption is that many physicians are not yet sold on the benefits, especially with current reimbursement policies that pay for diagnostics and treatment, but not for the handling of information. Others who run small practices simply don't have the capital to invest in information technology. Electronic health records, a tool Lieber recommends as a starting point, cost anywhere from $20,000 to $40,000 per physician.

"The investment that a physician or hospital makes is an investment on something that won't give immediate payback," Lieber said. "They can't charge for that type of activity, and that's causing a lot of physicians, who are basically small businesses, to hold up on this because they don't see the immediate cash return."

In addition to strong practice management and influencing employee behavior, Lieber recommends that employers provide support for the key IT adoptions that "will affect things immediately." This means electronic health records (EHRs), especially at the physician level, "so that you can eliminate duplicate tests" and save on other wasteful spending, he said.

It is not unusual for an employee to go to one setting, have a test, and get referred to a specialist who then repeats the test because the results didn't follow the patient. "Things like that can have very immediate impacts on the cost of care," Lieber said, "and so I think those are some very early and easy sorts of things to do."

Long, long road

Although the United States is far behind in adoption - some European nations are fully automated - Lieber said more American healthcare facilities plan to acquire an electronic system within the next 12 to 24 months. So while there is movement, the nation is starting at a very low level of adoption.

"It's going to be a while," Lieber said, "before we really see IT impacting the [healthcare] system."

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Comments

Stephen Anders responded 7 years ago: #1

And why do suppose some European countries have this capability? Could it be due to their smaller scale and socialistic structures that lend such undertakings to that which benefits the population?

Our own free-market system defeats us in like circumstances where the general population has needs but private industry and consumers have to pay out of their own pockets. EHR seems to be in supply, even moreso if not expensively CCHIT certified. Physicians aren't demanding it though due to the Total (all things considered) Costs of Ownership.

I can't for life of me understand how the government can continue to promote and even legislate new "standards" and expect the private sector (the w-h-o-l-e supply chain) to simply cough up the resources to do so - efficiently - allowing for continued free-market competition.

I am not a socialist, I am for capitalism, but I also know that some things can't be shoved down a free market's throat without some of Uncle Sam's generous help - or without everyone in the private sector making equitable concessions. Is this an opportunity or a problem?

A. Scott Holmes responded 7 years ago: #2

Thinking is fundamentally flawed:

CPOE is infrastructure which can pay for itself through reduction of medication errors. This is important, but these are not the most deadly and expensive to fix.

EHR is a dream. Lack of technical standards prevent it. Until vendors support the standards which permit interoperability, meaningful clinical electronic interchange cannot occur.

Now, if you step back and stop listening to the gibberish from the large HIS vendors, there can be huge paybacks from systems which prevent labor and delivery, OR, ICU failure to identify the right specialist, delayed referrals, pneumonia contracted from defibrillators, etc. Hospitals spend more than 20 percent of their budgets fixing these errors.

Most of these can be prevented. This is not rocket science. The solution is in front of our nose. The problem is that hospitals pour most of their money at bulky, hard to operate, and unfriendly CPOE and EHR systems that are hard to use.

There is a cheaper, faster, better alternative.

Darrell Pruitt DDS responded 7 years ago: #3

This week, the Supreme Court declined to hear a case (Citizens for Health v. Michael O. Leavitt, 05-1311) which would have required health care providers to obtain patients’ consent before allowing disclosure of their health information by third parties. As if on cue, articles are popping up, including a shocking one in the October edition of Consumer Reports, exposing the legal sale of patients’ health data by “medical-related” industries. Do you sense tension building along fault lines?

Legal, albeit unethical disclosure of patient health information, as well as accidental breaches in security, like stolen laptop computers, will ultimately attract the attention of Congress. The inevitable mandated solution will surely be even more bad news for healthcare IT salespeople.

Even though Mr. Lieber is valiantly hopeful that providers will see, or at least imagine the economic benefit of EHRs, the monstrous HIPAA blunder is sure to become even more expensive as electronic records become increasingly risky to maintain. Small healthcare practices which are now “paperless” are likely to return to pegboard systems of accounting, including ledger cards, rather than risk losing their patients’ trust. Progress.

The bridge to meaningful, interoperable and universal healthcare IT is plagued with serious foundation problems and the ground is moving.

Darrell Pruitt DDS

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