Over the next two years, 58% of small physician practices plan to roll out electronic health records. And by 2014, the federal government wants more than half of all healthcare facilities to use EHRs.
To date, however, less than 20% of hospitals and 25% of physician practices have deployed EHR systems, and most of them would not meet the federal government's criteria for "meaningful use" of those systems, according to Karen Bell, chairwoman of the Certification Commission for Health Information Technology (CCHIT), nonprofit organization whose mission is to accelerate the adoption of healthcare IT systems.
Perhaps the biggest obstacles for physicians and hospitals are the magnitude of many healthcare IT projects and the need to meet those "meaningful use" requirements from the Office of the National Coordinator for Health Information Technology (ONC), which is part of the U.S. Department of Health and Human Services. To help providers overcome those obstacles, public and private financing is available for EHR rollouts. Moreover, there are cost-effective ways of deploying the technology, and it may not even be necessary to rebuild an existing IT infrastructure to accommodate an EHR system. One option is to share the data center of another local healthcare facility that has a large IT support staff.
Nonetheless, even with financing and alternative deployment strategies at their disposal, hospitals and other providers that haven't started using EHR technology might want to wait.
"I know there are incentives out there... but the $44,000 or $65,000 you can get comes over a five-year period," Bell said. "If you haven't gone through the readiness process, gotten your staff ready and gotten everyone on board with what this will entail and put a project plan in place, then you'd probably do better to wait -- maybe even until 2013, when a whole new set of criteria comes out."
By waiting, clinics or physician practices would not only be able to meet more of the criteria for meaningful use of EHR systems, but they would also be able to deploy systems that meet their own criteria for patient care and administrative automation.
The ONC uses the CCHIT to test and certify EHRs. To date, the CCHIT has certified 66 EHR products, many of which have varying levels of sophistication.
The CCHIT also has the authority to certify homegrown EHRs. If a hospital builds out its own infrastructure and pieces the software modules together, the organization can remotely access servers and work with administrators to offer a certification specifically for that system, Bell said.
There's no question that EHR technology can benefit both healthcare providers and patients, experts agree. EHRs allow physicians to share test results, radiological images and other clinical information in near real time with patients and other physicians. They can also reduce administrative tasks associated with paper-based systems, and they will eventually help ensure that caregivers adhere to so-called evidence-based medicine, or the use of best practices for treatment.
At the same time, physicians who employ EHR systems will be able to more easily use wireless devices, such as tablet PCs and smartphones, at the bedside and from remote locations.
The most basic in-house EHR systems cost about $250,000, but depending on the size of the organization and the capabilities of the technology, the price tag can quickly grow into the millions for larger hospitals, according to Judy Hanover, an analyst at research firm IDC's Health Insights unit.
Under the American Reinvestment and Recovery Act (ARRA) of 2009, physicians who implement EHR systems and demonstrate that they are engaged in meaningful use of such systems can receive reimbursements of up to $44,000 under Medicare and up to $65,000 under Medicaid.
Physicians and hospitals that don't roll out EHR technology or don't prove that they are making meaningful use of it by 2015 face penalties in the form of reduced Medicare reimbursements.
There are three stages of meaningful use, as defined by federal officials. Doctors and hospitals now implementing EHRs do so under Stage 1 guidelines released this past summer. Stage 2 and Stage 3 guidelines are set to take effect in 2013 and 2015, respectively, with the final rules coming out about a year before they go into effect.
The criteria for Stage 1 focus on improving the quality, safety, efficiency and coordination of care, and on reducing health disparities. They also call for adequate privacy and security protections for patient health information.
There are about 25 Stage 1 meaningful use objectives that must be met. Among other things, a computerized physician order entry (CPOE) system must be used for at least 80% of all physician orders and 10% of hospital orders, real-time electronic drug and allergy alerts must be enabled, and at least 75% of all prescriptions written by a clinician must be transmitted electronically to a pharmacy.
Wait on it...
Most people think of software when they think of electronic health records, but the systems also require hardware, operational and technical support, broadband networks and wireless connectivity, Bell said. A successful EHR deployment also requires staff buy-in. "Believe it or not, there are still a lot of people who are not comfortable with typing," she said.
Dr. Tom Handler, a radiologist who's now a healthcare analyst at research firm Gartner Inc., said one of the greatest challenges in rolling out an EHR system is establishing what's called clinical governance, or guidelines for how physicians in a practice or in different departments in a hospital need to use the electronic data systems.
"How should you get the system up and running in a practice? Or, if it's a multichain hospital, how do you roll it out to all [your] hospitals ... and ensure all the pieces and parts are rolled out in right order," Handler said. "So in some ways it's less about the technology and the hardware and the software and more about the culture and the governance and the management."
The CCHIT offers two EHR certifications. One is the CCHIT 2011 Ambulatory Certification, which goes to EHR systems with state-of-the-art security features, integrated components and the most robust patient care capabilities. The other certification, the ONC-ATCB, only verifies that an EHR system is capable of helping caregivers meet the meaningful use requirements.
Systems with the latter certification will help physicians and hospitals get federal incentive funds, but they may not offer a full set of features for patient interaction. And more than likely those systems' modules -- for billing, patient scheduling, image archiving and other tasks -- won't talk to each other, meaning they would have to be managed through separate interfaces.
Bell recommends choosing an EHR system with dual certification, which guarantees it will be state-of-the-art for patient care, practice management and meaningful use. Of the 66 EHR systems the CCHIT has certified as meeting meaningful use criteria, 30 have dual certification, Bell said.
"A certified product gives you all the functionality, interoperability [and] state-of-art security... for patient care," she said. "But ... you need to teach all your staff in the process. It can't just be a physician decision.
Which EHRs to use
One way to defer the cost an EHR rollout is to choose the software-as-a-service (SaaS) option, where a vendor runs the applications in its own data center while offering caregivers the EHR functionality over secure networks.
Handler said physicians and hospitals need to have a clear understanding of what they're buying if they go the SaaS route. Most vendors that say they have SaaS offerings actually sell hosted services. The difference? In the SaaS model, software resides on servers in a vendor's data center that is shared by multiple customers. It's most often not customizable, but rather a one-size-fits-all product. A hosted service means the vendor sets up a physical infrastructure with customized services for your environment.
Of the eight major enterprise-class EHR vendors that Gartner covers in its research-- Allscripts Healthcare Solutions, Cerner, Epic Systems, GE Healthcare, McKesson, MEDITECH and Siemens -- none uses a true SaaS model. All offer hosted services.
Other EHR SaaS vendors include, eClinicalWorks, Ingenix, AthenaHealth, Greenway and NextGen Healthcare.
Typically, providers that choose a SaaS-based EHR system pay an upfront start-up charge followed by a per-physician monthly subscription fee. According to Handler, a good rule of thumb is an organization should not pay more than $500 per physician for a hosted EHR system. And depending on how badly a vendor wants your business, you could end up paying much less.
"The larger vendors offer more in terms of financing options than others," said IDC's Hanover.
For example, GE Healthcare can leverage its $50 billion sister division, GE Capital, to offer financing packages. A smaller vendor, such as Greenway Medical Technologies, might be able to offer more personalized service, but it uses a third-party leasing partner for its financing.
Jim Corrigan, vice president and general manager of GE Healthcare IT, said his company charges on a per-physician basis, with the fee varying depending on the terms of the service level agreement, which covers things such as practice management, connectivity to labs, insurance payments and billing systems. The bottom line is that GE Healthcare IT charges $3,000 and $6,000 per doctor in upfront costs and $300 and $600 per physician each month.
"We're also going to experiment on our SaaS model by upping the monthly fee and reducing the upfront fee," Corrigan said.
Like other large EHR vendors, GE Healthcare also offers a number of financing programs, such as a zero-down, zero-payments-until-2012 option. The benefit of that financing option, which GE calls the Stimulus Simplicity plan, is that a clinic can deploy an EHR now and then get qualified for meaningful use reimbursements before paying out of pocket.
Alternatives to vendor SaaS
While the SaaS model is attractive because it offers lower start-up, operational and maintenance costs, it does often involve vendor lock-in.
"There's no portability to [a SaaS-based EHR system]," said Bell. "If a company goes out of business, or if you decide to move your records from one EHR and go to another, there most likely will be issues with getting the data out of where it's residing and moving it to somewhere else."
Bell also points out that there are hidden upfront costs many users forget to consider with a SaaS EHR setup. They include, for example, the costs of installing the proper networks and ensuring that the new software will work with your existing practice management system.
"These are all things that have to be considered," she said.
For Columbia Memorial Hospital in Hudson, N.Y., unexpected costs came from the need to upgrade remote physician practices from Windows 2000 to Windows XP servers, and from the need to get wireless and broadband networks installed. The hospital is located in a rural area, so getting adequate bandwidth is difficult. Most of the remote clinics were running fractional T1 lines or DSL virtual private networks with 1.5KB/sec. download and 512KB/sec. upload speeds. The hospital needed 768KB/sec. bidirectional capacity to handle the additional data traffic that came with an EHR system.
At one clinic with four physician practices, the hospital was forced to run a 10Gbit/sec. fiber optic line. The project required the use of "several carriers," said Michael LaForge, Columbia Memorial's network administrator .
LaForge said his hospital considered using a SaaS offering for itself, but the board decided it wanted control over the information, hardware and software. Having control can be costly, though. Without putting an exact price on the project, LaForge said it cost millions of dollars.
"I think in the end, we were a little surprised what the costs were. Not only was it expensive to get in, but then you have the ongoing costs. You figure in 26 practices and remote sites, and it adds up fast," he said.
LaForge said hospitals not only have to figure in monthly license fees, but also have to pay for maintenance and support for things like tablet PCs, laptops, smartphones, scanners and even fax lines, which some physicians insisted on even though they could fax documents electronically.
Columbia Memorial's CIO, Cathy Crowley, was able to secure a significant amount of state grant money to help defray the cost of the EHR rollout by offering to share the hospital's data center with physician practices that aren't affiliated with Columbia Memorial.
Under the state's HEAL New York grant program, the 190-bed hospital was able to afford a virtualized cloud computing network that serves 200 clinicians at 26 clinics, laboratories and group practices in the Hudson River Valley.
The hospital set an aggressive six-month timetable for implementing the EHR system because it had to meet grant deadlines. "Normally, I'd advise you to spread it out some, because we didn't have time to learn from one or two implementations before we moved on to the next one," Crowley said.
To save money and avoid server sprawl while managing systems centrally, the hospital went with a VMware virtualized server environment. The hospital also chose Stratus Medical Grade ftServer and ftScalable Storage for the core of the cloud infrastructure to provide the required uptime to serve the various physician practices.
"Had we not done server virtualization and some other things, our costs would have been higher, but even still, it was higher than we'd projected," Crowley said.
"It's one thing when I can send out an e-mail in our hospital saying we're going to be down for maintenance today, but now we're answering to all these other clinics," Laforge added. "We had to look at ourselves as a SaaS provider. The hardware fault tolerance of the Stratus equipment combined with VMware gave the kind of uptime we felt we needed to provide."
The hospital has four virtualized servers and one server for vCenter, which cost several hundred thousand dollars in hardware alone.
Crowley and LaForge are still working on integrating the hospital's laboratory and radiology departments with the EHR system, but the technology has been available to the rest of the hospital and to affiliated and nonaffiliated physician practices since May. Nonaffiliated practices have their own discrete database instances, but all of them pay the hospital for the service based on a chargeback model.
"From that perspective, it's a SaaS model to them," LaForge said.
In some cases, regional hospitals with large IT shops have opted to build out their data center infrastructure in order to host affiliated and nonaffiliated hospitals in their areas. As IDC's Hanover puts it, "IT often is not a core competency for hospitals and physician practices." Moreover, a small clinic isn't likely to keep good IT personnel around for long, she added.
The system at University of Pittsburgh Medical Center (UPMC) is a good example of shared EHR services. UPMC is an $8 billion integrated global health enterprise headquartered in Pittsburgh, and it's one of the leading nonprofit health systems in the country.
For all intents and purposes, UPMC runs a private cloud. All healthcare, financial and administrative applications run in a shared environment.
Paul Sikora, vice president of IT at UPMC, said his hospital shares its data center with 27 other hospitals in the region, including Children's Hospital of Pittsburgh, which opted to run its EHR applications on discrete servers in UPMC's facility.
In 2009, the Healthcare Information and Management Systems Society honored Children's Hospital with its HIMSS Analytics Stage 7 award in recognition of the fact that the hospital had an advanced patient record environment. "One reason they were able to do it is they didn't have to worry about infrastructure," Sikora said.
UPMC, which itself won an HIMSS Analytics Stage 7 award this year began to rip and replace its outdated data center infrastructure five years ago at an unspecified cost of millions of dollars -- and it was worth every penny, said Sikora. An IDC evaluation of UPMC showed that the hospital avoided $80 million in expenditures that it would have incurred if it had stuck with its legacy infrastructure, Sikora said.
Apart from the $80 million in cost savings, Sikora said he was also able to avoid the need to build a new $85 million data center in order to keep up with server sprawl.
"A lot of that savings was because of the virtualization we rolled out," he said. "When you can pack 24 rows of servers [we formerly had] in to one server rack, that's savings. When you cut 100 Unix servers down to 14, that's savings." UPMC runs its new virtualized environment at one-fifth the cost of its legacy data center, he added.
UPMC runs 1,300 Windows virtual machines on 22 physical servers, allowing it to add capacity for hosted hospitals in hours through strokes on a keyboard instead of building out additional infrastructure. And I/O loads are matched with the most cost-effective computer service in the environment.
UPMC not only virtualized its servers with VMware; it also virtualized its storage with IBM's SAN volume controller appliance, which sits in front of storage arrays and makes them appear to application servers as a single pool of available capacity.
"When you get all of your enterprise systems in a standardized environment, you can start to manage it differently. You start to see load characteristics ... and then you can determine that you can take this data and put it on Tier 3 storage with a lower cost," he said.
UPMC, which has an IT staff of 197 people who support 4,000 physicians, began its data center consolidation and upgrade in 2005, long before the government began formulating its requirements for meaningful use. Sikora said the technical complexity behind EHRs just from an infrastructure standpoint is "enormous." A midsize hospital starting up an EMR project could devote more than half its effort just to getting the new infrastructure operational. "And that hinders the ability to do the task at hand, which is the health record itself," he said.
"What we do is very scalable. Any number of community hospitals could share in an environment like ours," he said. "I think if the government were to fund some type of regional data centers, it's probably money better spent than giving hospitals money to figure out how to do it."
In order to justify the cost of an in-house, client/server EHR model, physicians should tackle EHR projects in groups of three or more, according to Bell.
IDC's Hanover recommends that, before rolling out an EHR system, physicians and clinics should first perform a gap analysis to determine what they currently have and what they still need in order to roll out the new system. They should consider what technology will be required to support their service goals, and they should take into account both near-term and long-term meaningful use requirements as well as their the future patient care goals. Only after doing all of that should they put together a request for proposals for vendors.
Gartner's Handler suggests that healthcare providers should also consider processes and protocols -- in other words, they should figure out how to standardize technology rollouts from physician practice to physician practice and hospital to hospital in a group. Also, they should consider whether they need functions such as order sets as part of a computerized physician order entry system with prefilled ordering templates.
The Office of the National Coordinator has established 66 Regional Extension Centers, or RECs, throughput the U.S. for the explicit purpose of helping physician practices and rural clinics roll out EHRs.
RECs were created last year under the Health Information Technology Economic and Clinical Health (HITECH) Act. For the most part, the RECs don't provide healthcare providers with any funds, but they do offer training and technical assistance in rolling out computer systems. Each REC has 10 to 30 employees, depending on the size of the region in which it operates.
The U.S. government also issued $144 million in grants to create college courses to train people and help fill an estimated 50,000 jobs needed to assist doctors and hospitals as they roll out EHRs. However, none of that money covers the cost of EHR hardware and software -- the most basic costs associated with health IT.
Another reason to wait
Bell said physician practices and clinics that haven't begun implementing EHRs may get a system that truly suits their needs -- and meets federal meaningful use criteria -- later on.
By waiting until 2012 or 2013, healthcare facilities can ensure that they are preparing to meet both Phase 1 and Phase 2 meaningful use requirements.
"The very first step that needs to happen, which frankly many physician offices skip, is the business plan. Why are you doing this? Be very clear about your revenue stream now, your revenue stream after you adopt," Bell said. "Ask if this is the time to go forward with an EHR, or should you watch and wait a little more?"
If you ask Crowley, however, there are worthwhile benefits to implementing an EHR long before the government's deadline.
"We're definitely pleased we did it, and we can see the light at the end of the tunnel. I think we'll be ecstatic once a whole year goes by and everybody's much more comfortable with it," Crowley said. "In terms of patient safety ... we've taken a huge leap forward."
Lucas Mearian covers storage, disaster recovery and business continuity, financial services infrastructure and health care IT for Computerworld. Follow Lucas on Twitter at Twitter @lucasmearian. His e-mail address is firstname.lastname@example.org.
This story, "When and how to deploy e-health records tech" was originally published by Computerworld.