THCB

Who Should Pay for EHRs?

During the 2008 Presidential campaign, Candidate Obama promised an EHR for every American by 2014. The goal was to improve quality of care, reduce disparities and contain costs of health care. When the HITECH act became law in 2009, physicians found themselves under increased pressure to purchase an EHR. Many took action, went out and bought an EHR for their practice, and these are now well positioned to collect the financial incentives put forward by the HITECH act. Many more did not. EHRs are by and large a complex and expensive proposition and the HITECH incentives are not covering the average cost of purchasing and maintaining an EHR. In survey after survey, physicians consistently rank cost associated with EHRs as their top concern when considering transition from paper charts to electronic medical records. This is a bit disconcerting, since physicians have no problem buying other expensive tools and paying for human resources in their practices. How are EHRs any different?

There are three primary stakeholders in health care: those who receive care, those who provide care and those who manage the financial aspects of health care, and no, we are not getting into the quintessential argument of whether there should be only two primary stakeholders. There are several secondary stakeholders as well: those who manufacture medical goods, those who provide ancillary services and those engaged in medical research.

Various constituencies may derive more value from one particular function rather than the others, but as long as that value exceeds what is made available by a paper system, someone should be willing to pay for it. Let’s examine our stakeholders, and their willingness to pay, from the bottom up.

Secondary Stakeholders – Here we find the drug and device manufacturers and the bewildering array of diagnostic facilities. Most of these companies are largely indifferent to what EHRs do and some stand to lose revenue when EHRs shine bright lights on spending patterns. They are not likely to consider paying anything for widespread EHR adoption. On the other hand, the mushrooming mobile health and personal health application providers, who base their entire existence on the availability and successful use of EHRs, show no willingness to share in the cost of computerizing medical records. Needless to say that medical research centers which have been habituated to mostly free access to data sources, may be willing to pay data aggregators, but would never consider participation in infrastructure investments.

Health Insurance Providers – The largest health insurance provider in this country is the Federal Government through the Centers for Medicare and Medicaid Services (CMS), and CMS is proposing to bear a rather hefty portion of the costs of EHR deployments. Obviously CMS is expecting to see great financial rewards from a fully functional EHR network. Whether CMS is placing onerous or misguided requirements on the technology is a completely different question and one has to keep in mind that CMS is primarily a payer and its primary concern must be proper stewardship of tax payer funds. To do that, CMS needs data, and lots of it. You don’t usually pay a mechanic to take a look at your car – you pay him to fix it. CMS is now paying health care providers to treat people and it would much rather pay them to fix people and keep them under warranty, and it would also prefer that this is done via a fixed price contract, instead of the current time & materials model. EHRs are the tools by which quality assurance is performed and deliverables are accounted for and measured.

What’s good for the goose should be good for the gander, and private insurers figured out that paying for EHRs may not be such a bad idea after all. I am not 100% certain, but I would suspect that financing EHRs for physicians in order to improve quality of care falls under the medical expenditures rubric and can be deducted from the federally imposed Medical Loss Ratios (MLR). Since private insurers have historically ran much tighter ships than CMS, I would expect that in return for their Stark exempt contribution to EHR expenses, private insurers will ask for at least as much data as CMS and probably a lot more.

Health Care Providers – These folks are as diverse as the patients they serve, but their interests in EHR are most closely correlated to their size, which ranges from the solo doc in a micro practice to integrated delivery networks serving millions of patients. For large providers who operate multiple and varied facilities of care, EHRs are a tool to effectively manage their business. They were always willing to pay for them and they are continuing to do so now, in spite of the constant rumbling about CMS regulations. At the other end of the spectrum, the small providers, mainly physicians in private practice, who are more financially strapped than ever, see no good reason to take on debt and pay for tools with no demonstrated ability to provide tangible returns. Keep in mind that using paper-based tools to manage a few hundred customers who purchase one of a handful of services between 9 and 5 four days a week, is not nearly as onerous as managing millions of customers purchasing thousands of different services around the clock all day every day. Nevertheless, even these small providers are starting to buy EHRs. As EHR software gets better, some manage to find efficiencies never before contemplated and others are just trying to keep up with the Joneses and survive. Reluctantly and grudgingly, with lots of hard feelings building up, they too are willing to pay.

Patients – All stated goals of EHR adoption ultimately benefit patients. Some may stand to benefit more than others, but in aggregate we will all benefit from improved quality, reduction in disparities and cost containment of medical services. Whether directly or indirectly, through taxation, premiums, wage reduction, increased prices of goods and plain old cash, patients pay for the entire enormity we call health care costs, which includes cost of actual care delivery, overhead and profit margins for all other stakeholders. EHR software is part of that overhead and so are the costs of analyzing, displaying and exchanging information collected by EHR software. When CMS and private insurers and even health care providers write checks for EHR software vendors, somewhere down the line this translates into a little bit less health care for each patient and/or a little more money needed to obtain care. So although we pay for all EHR expenses, we as patients, find ourselves in the perplexing situation where we are forced to lobby, argue, advocate and practically beg for access to the work product of EHR software. And that work product is our life story. It is the record of our birth, the narrative of our childhood successes and mishaps, a document of our education, sexual activity, fears, hopes, marriages, new children, career choices, residence, divorce, widowhood, disease, death and everything in between. In other words: Data. We are paying for this data to be collected, exchanged and analyzed. We are paying for people to decide if we should have a right to opt-in or opt-out of such activities. We are paying for media campaigns to convince us that what we are already paying for is worthwhile.

So here is one suggestion: instead of paying for EHRs indirectly, while allowing all stakeholders to complain about the expenses as if the fees came out of their own pockets, how about patients paying for EHRs directly? There is no difference in aggregate and we are not talking about a lot of money for each individual patient. A yearly fee of something between $5 and $10 per patient, per facility, should suffice. Call it EHR fee, or EHR subscription. Once we explicitly pay for it, we own it; not the software, not the hardware, but the Data itself. And this is how it should be.

Margalit Gur-Arie was COO at GenesysMD (Purkinje), an HIT company focusing on web based EHR/PMS and billing services for physicians. Prior to GenesysMD, Margalit was Director of Product Management at Essence/Purkinje and HIT Consultant for SSM Healthcare, a large non-profit hospital organization. She shares her thoughts about HIT topics and issues at her blog, On Healthcare Technology.

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Sid Savard
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Flickr is much better than Picassa. You can sign up with your Yahoo name and password.

Rich
Guest

A better question is why are practitioners buying they current offerings when they are built on arcane technology?

I have an advanced system that fits EHR perfectly but its very difficult to get it in front of practitioners before they waste the money on old style systems.

EdB
Guest
EdB

Correct me if I’m wrong, but aren’t patients already paying the lion share of physicians’ EHR implementation costs? It’s taxpayer money that’s funding the HITECH program

Margalit Gur-Arie
Guest

Yes, it is, and yes, we are. But right now, we (all of us) get nothing in return because this is not an explicit transaction. If we paid for our EHRs outright, instead of having a nebulous “government” paying for them, perhaps we could at least have some say in what is to become of the data accumulated in those EHRs, and who can use and who can profit from it, instead of being relegated to begging for access to our own information.

Lehr
Guest
Lehr

I’d spend $5-$10 IF it would provide me a way to reduce my overall healthcare expenditures. I’m sure most patients feel the same except for the integration bill they’ll get today.

Lehr

melbourne boot camp
Guest

yeah, i really need to this….

BobbyG
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Margalit Gur-Arie
Guest

Hello Brian, Let me answer you with a few questions. What happens to the patient data stored in those free or not-free EHRs? Do the patients know where it goes? Do they approve? Can the patients get ALL their medical records out of that system, if they choose to (as in delete everything from your database)? Can they even look at those records (all of them) whenever they please? Can they add their own content to their own records? Right now EHR data is treated as the property of whoever can get a hold of it by any means necessary.… Read more »

DeterminedMD
Guest
DeterminedMD

So, what, we give every single person a flashcard to hold this data? Can you trust the average person to keep it available for every visit, and the computer access will be user friendly for every contact? And what if they lose it, what is the backup system? Will it be fully confidential? What if the computer system crashes before or during that visit? is the data recoverable? What if someone has the same name and wrong information is put on that flashcard? What if the patient uses that information falsely or for flagrant illgotten gain? What if the US… Read more »

BobbyG
Guest

“What if the US government uses this system for inappropriate reasons?
You all trust government to be altruistic and benevolent.”
___

Unlike the totally ethical and altruistic for-profit health insurors.

DeterminedMD
Guest
DeterminedMD

Who said or implied that for profit health insurers are ethical and altruistic?

I sure didn’t. And government certainly is not an appropriate alternative to for profit insurers. Not with the gang that runs DC as of 2011,

Margalit Gur-Arie
Guest

No, not a flashcard. The usual and customary EMR that is being currently sold to practices. Nothing needs to change there, Dr. D. However, paying for the technology should give patients (people) a little more say about how their personal information is used.
I believe there is, and there must be, an expectation of privacy when someone sees a doctor. I don’t recall a referendum where people agreed to have this expectation waived.

BobbyG
Guest

I am eyeball deep these days in the PHI/ePHI privacy and security issues. There is only one state that accords you explicit “ownership” of your health data. The others are a mish-mash of differing data/record ownership, access, consent (all of that opt-in, opt-out stuff) disclosure (w/ granular datum/to whom/for what purpose variations), right of review, corrections, etc “rights.”

Moreover, it’s a moving target, as both the technology and the laws/regs change.

Margalit Gur-Arie
Guest

Indeed it is, and this pertains to fully identifiable data. “De-identified” data is a free for all.
Pretty much like saying that if you rip the covers from a stack of books, so the authors and publishers are not identified, and proceed to mix up all the pages, you can then use the contents in any way you want.

The other problem with all these opt-in/opt-out debates is that right now, nobody can get access to their full chart. All those Blue Buttons and portals are very selective in what they actually provide.

BobbyG
Guest

““De-identified” data is a free for all.”

Yeah.

Google “Latanya Sweeney” (the “all I need is ZIP code, Gender, and DOB to back my way into your PHI” lady from MIT)

Brian Hsieh
Guest
Brian Hsieh

Honestly? We don’t ask patients to pay for the phones do we? nor the paper to print charts, nor the transcriptionist.. One of the EHR vendors claims that they are the fastest growing and they are free – you get 44,000 of tax payer dollars for free software! Oh wait the drug companies are paying to put their ads right on the screen with your clinical notes. Hmmm not free.. If you work in this industry you would know that the core reason that the govt (the largest payer) is investing in ehr’s s because they hope it will drive… Read more »

Dr. Mike
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Dr. Mike

I’m not sure I would feel right about asking for even $5 a year from my patients for the use of an EMR when I myself don’t pay anything for it – I use Practice Fusion and it’s free (except for the computers, ISP charges, etc)

BobbyG
Guest

Well, yeah, true. But if you were forking over $7,500 for the first doc for just the software license, it’d be different? (The range of prices for the same basic functionality is pretty difficult to understand.)

Margalit Gur-Arie
Guest

Dr. D., I may be naive, but I don’t think PPACA is about power. You may disagree with the methods, and I certainly disagree with some, but I do believe the intentions are good, and yes, I do know that good intentions often backfire. As to people paying for intangibles, yes, this is a problem, but that little brochure at check-in that Bobby is envisioning can explain in no uncertain terms what they are expected to pay for. And yes, of course, this includes the lifetime medical record ( I don’t like the term PHR). I think CMS should allow,… Read more »

DeterminedMD
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DeterminedMD

First, in response to Ms G-A’s above comment, it is only my opinion, but I also pay attention to history and patterns, and our government has deteriorated to pure partisan positioning and control, and both parties are equally guilty. We watched the Republicans use war to control the people into giving up liberties as well as the option to dissent without being called traitors and antiAmerican. Then, when the Democrats came into power, they saw the health care system as their opportunity to further erode choice and individuality per this pure partisan legislation. No transparency, no honest debate, and no… Read more »

John Irvine
Member

DeterminedMD writes

“The average American is cheap and lazy …”

And is accusing me of overgeneralizing?

/ j

BobbyG
Guest

I know. That was rich.

DeterminedMD
Guest
DeterminedMD

Interesting term there, rich. I heard tonight while driving home that close to 50% of Americans are getting some form of government handout/support.

While some portion of that is valid, it is not 50% of the population. Seems to once again support my original comment that the average american is cheap and lazy.

Entitlements do not empower people, they enslave them.

BobbyG
Guest

” 50% of Americans are getting some form of government handout/support.”
___

And, of course, there’s no way to verify that YOU are not among them in any way.

BobbyG
Guest

Maybe you should change your handle here to “JohnGaltMD.”

Margalit Gur-Arie
Guest

Perhaps this will help explain why 50% need help

http://www.alternet.org/economy/152601/5_facts_you_should_know_about_the_wealthiest_one_percent_of_americans

Unbridled greed is what enslaves people

DeterminedMD
Guest
DeterminedMD

And buying the politicians should not be minimized or ignored. But, people keep voting the same lame shameless incompetent incumbents back to keep feeding at the trough of public funds. Not teaching enough people how to fish… And yeah, I am getting government handouts every day. NOT! Certainly the patients I treat on Medicaid and Medicare is no handout for the work I do, that is for sure!!! By the way, Mr G, related to “Sally G” per the Paul McCartney song from the 70’s? The line in there, “I’m sure the G did not stand for good” certainly fits.

John Irvine
Member

“The average American is cheap and lazy ..”

What planet do you live on?

DeterminedMD
Guest
DeterminedMD

Last I checked, it was called Earth, and I reside in the United States of America. Average means that, not everybody. Man, you people will over-generalize at the drop of a hat. And who do you interact with to find this interpretation to be so over the top anyway? People on average, at least more than 40% or more, are cheap and lazy here. Even rich people fit that appraisal. Ask people who visit America or have spent time on visas who are attentive and appreciative of work ethics and expectations. They don’t worship at our altars, sir. Yeah, buy… Read more »

DeterminedMD
Guest
DeterminedMD

Oh, and by the way, if people aren’t cheap and lazy, why is it a sizeable portion of the population I see in practice bitch about having to pay higher copays for the brand names THEY ask for in the office, and then don’t want to come back for a follow up appt even in 3 or more months to check up on the meds effect, just want me to call in a refill?

Doesn’t that seem cheap and lazy?

DeterminedMD
Guest
DeterminedMD

but PPACA is about power, and those who want it will not give it away, even if the alleged profit opportunity seems sizeable. Besides, the average American is cheap and lazy, and asking people to spend money on something they cannot touch or quantify at moment one is not acceptable to that mentality.

Nice thought in theory. Practice, eh, is not so nice.

BobbyG
Guest

Very nice, as always.

“A yearly fee of something between $5 and $10 per patient, per facility, should suffice. Call it EHR fee, or EHR subscription. Once we explicitly pay for it, we own it; not the software, not the hardware, but the Data itself. And this is how it should be.”
___

I Had that very thought right when I started my REC work. You can just see the little “$5 EHR technology fee” sign taped to the check-in window, and a brochure on the counter.

BobbyG
Guest

I would also provide PHR capability for my fee. Yeah, of course, some pts will no use it, but many will.