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.