On September 17, an op-ed piece discussing health IT was published in the Wall Street Journal. Written by Drs. Stephen Soumerai and Ross Koppel, “A Major Glitch in Digitized Health-Care Records” discusses the dearth of evidence to support that information technology reduces healthcare costs. In particular, they reference a piece of research published in October, 2011 by a team at McMasters University in Hamilton Ontario.
That study – which focuses upon the use of health IT in the medication management process – touches upon a key challenge in the healthcare space: that many studies available today provide only data on the direct cost of health IT components purchased, without considering outcomes or other difficult-to-measure gains and losses. As stated by the paper’s authors:
“Discussion: Most studies merely provided cost data; however, useful economic data involves far more input. A full economic evaluation includes a full enumeration of the costs, synthesized with the outcomes of the intervention. Conclusion: The quality of the economic literature in this area is poor. A few studies found that HIT may offer cost advantages despite their increased acquisition costs. However, given the uncertainty that surrounds the costs and outcomes data, and limited study designs, it is difficult to reach any definitive conclusion as to whether the additional costs and benefits represent value for money. Sophisticated concurrent prospective economic evaluations need to be conducted to address whether HIT interventions in the medication management process are cost-effective.”
The study’s authors articulate two realities that bedevil the health sector at this juncture: we don’t yet have enough Return On Investment (ROI) case studies available for review, research, and evaluation; and, typical economic models for assessing return on investment are inadequate for the health sector.
Within HIMSS, we’ve spent years gathering stories about the economic impact of IT in a health setting. In November 2011, HIMSS published a thought leader piece called “The Value Factor in Returns on Health IT Investment.” Based on HIMSS Analytics research, the traditional definition of ROI as used in other industries isn’t necessarily a good fit for the healthcare industry; successfully demonstrating ROI in healthcare involves more than simply looking at how much money is saved or earned.
A true measure of ROI must include the full spectrum of benefits that can result from a successful IT implementation: improved patient safety, improved quality of the care provided, improved relationships with patients, streamlined internal processes, innovation, and other qualitative factors. HIMSS recommends that health providers use the following areas to evaluate ROI:
- Efficiency Savings
- Improved outcomes of care compared to pre-health IT implementation
- Additional revenue generated as the result of an IT implementation
- Non-financial gains such as, but not limited to, increased patient satisfaction with care encounters, decreased provider time at work, and higher levels of employee satisfaction
- Increased knowledge of providers about the patient population they serve
Process and quality improvementsInvesting in health IT is an expensive proposition. One estimate suggests that an EHR system costs $33,000 for each physician in a medical practice, with an additional cost of $1,500 per doctor per month for maintenance. According to the HIMSS AnalyticsTM Database, in 2010 U.S. hospitals spent a median of $16,448 per licensed bed on IT operating expenses, and an average of $5,304 on IT capital expenses per licensed bed. For the average hospital with 164 licensed beds, that translates into $2.7 million in annual operating costs and $870,000 in capital expenses per year. However, costs will vary widely; organizations at the early stages of their journey will experience much higher “start-up” expenses.
Of course these systems need to make a difference. That is the mission of HIMSS – to transform healthcare through the best use of information technology and management systems. Take a look at our Davies award winners – to win, a health provider must demonstrate improved outcomes. And, our Stories of Success also provide case studies of how the best use of IT resulted in improvements to care. Thanks to the HIMSS Analytics EMRAMTM, we have numerous Stage 7 case studies to share. To achieve Stage 7, hospitals must demonstrate superior implementation and utilization of health IT systems. All three of these programs offer care providers the opportunity to tell their story of true sharing, information exchange and immediate delivery of patient data to improve process performance, quality of care and safety.
We need more stories. Our nation needs better examples of successes and failures. And those stories need to include an assessment of the starting point, as well as the ending point. So, until we have such evidence, should we stop? Heavens, no! That’s nonsensical. Of course the patient comes first. Of course we need to be thought-filled in our strategic approach and implementation of IT. Of course IT needs to be user-friendly and functional for clinicians and patients. Of course health information needs to be interoperable and secure so that the right information is available at the right time in the right place for the right people.
Are paper records going to accomplish that? Of course not. So, tell us your stories – the good, the bad, and the ugly. We want to hear.