Given all the talk of the $700 billion bailout/rescue plan efforts in Washington this week, readers of HFMA’s “In the News” may have done a double take when they saw the headline about $700 million in funding for health IT.
The story offered some good news in a week of economic gloom. The Certification Commission for Healthcare Information Technology reports that it has identified 90 initiatives in the public and private sectors that together represent at least $700 million in potential funding for electronic health record (EHR) software and implementation costs.
The programs in the Certification Commission’s report include the biggest federal initiative to date—a $150 million Medicare demonstration project that will provide incentive payments to 1,200 physician practices that use certified EHRs to improve the quality of patient care.
It seems apparent that more of these initiatives will be needed to spur widespread adoption of EHRs, and Ezra Klein’s blog for The American Prospect suggests why (“Where Are My Health Records?”, October 1, 2008). Citing evidence from The New England Journal of Medicine, Klein notes that doctors receive only 11 percent of the savings from EHRs. Most of the rest goes to health insurance companies or the government. “In other words,” Klein argues, “it’s something of a collective action problem. We’d all be better off with wide adoption of electronic medical records. But it’s not in the direct interest of any of the relevant agents to actually pay the money to implement the systems.”
That’s what makes the news that both private and public sources are providing incentives for EHRs even better. HFMA’s healthcare payment reform initiative has pointed out the perverse incentives that run through our current healthcare system. In this case, physicians are being asked to assume an expense that will largely benefit other stakeholders in the system. Financial incentives that mitigate initial EHR costs would likely go a long way to encourage adoption of a technology that stands to benefit many stakeholders, most importantly the patients who would benefit from the reductions in medical errors and improved preventive care that EHRs can facilitate.
The recognition of EHRs’ value is apparently spreading. Also this week, an article in Information Week reported that Wal-Mart is offering EHRs as a voluntary benefit to 1.4 million employees and their dependents during this fall’s open enrollment season (“Wal-Mart Rolls Out E-Health Records to All Employees,” Oct. 1, 2008).
Where Wal-Mart leads, can the rest of us be far behind?
