Tuesday, August 30, 2011

Return on Investment (ROI) for EHR Systems

Until recent years, significant investments in the acquisition and implementation of Electronic Health Record (EHR) systems have not been that common in many health care provider organizations. However, the tide has turned and now there appears to be widespread acceptance that health information systems are essential to improve clinical and business practices and enhance the quality of care provided. 
Yet, while the war over whether or not to acquire and implement an EHR system in the U.S. has been won, the battles over which EHR system to acquire and how soon to implement  it continues. Also, questions about how to accurately measure the value of an EHR system still linger.

Measuring Value & ROI
Based on numerous projects in the U.S. over the past decade, there is now a substantial body of information documenting the tangible and intangible benefits achieved by health care organizations that have adopted health information technology (IT) and clinically focused EHR systems. The benefits include:

  • Increased Revenue
  • Cost Reductions
  • Improved Productivity
  • Improved Patient Satisfaction
  • Reduced Length of Stay
  • Improved Quality of Care
  • Improved Medication Safety
  • Enhanced Compliance Efforts
  • Utilization of Evidence-based "Best Practices"

As health care organizations begin to evaluate the benefits, value, and/or return on investment (ROI) in health IT, they need to remember a few important things:

  • Organizations should look at technology as a "business solution" and not simply as a new tool.
  • Measuring the ROI for health IT investment projects (e.g. EHR Systems) must include not only cost and quantifiable benefits, but also intangible or value-based benefits that organizations can derive from such projects.
  • Some technology investments need to be considered as a cost of doing business. Organizations will not operate an office without electricity or water. Similarly, they should not operate an office without IT systems in this day and age.
  • Implementing a health IT system may not reduce cost but will improve outcomes e.g., a surgical information system may or may not reduce operational costs, but it will result in better patient care outcomes.
  • Some technology investments are necessary for compliance with HIPAA and JCAHO regulations, accreditation processes, and other state and federal requirements.
  • Organizations should also assess the cost of not investing in health IT. For example, if appropriate tools are not implemented to support patient billing office, it could result in additional staffing, an increase in accounts receivable, and lower patient satisfaction.
  • Organizations should look at a longer term vision and strategy when considering the acquisition of an EHR system. Use of the planned National Health Information Network (NHIN) and Regional Health Information Organizations (RHIO) will necessitate the use of an EHR system in order to exchange data with others.

Links to Selected Studies

Conclusion: Improved Quality of Care & Patient Safety
While the potential for measurable cost savings documented in numerous studies over the past decade are impressive, the real return on investment (ROI) often comes from the many intangible benefits that we struggle to accurately measure and translate into dollar savings, e.g. better quality of care, improved patient safety, increased patient satisfaction.

Functions commonly found in EHR systems today include allergy checking, drug-interaction checking, medical alerts, access to additional patient data maintained by other health care organizations, and so many other features paper-based patient records are not capable of providing. It is these features of EHR systems contributing significantly to patient safety and better quality of care that provide the real justification for acquiring and implementing these systems.

Do your due diligence. Look into the potential tangible and intangible benefits of using an EHR system. Then put together your plan and get started!

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