Dialing for Electronic Health Record Dollars

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Kathleen Sebelius, Secretary of the Department of Health and Human Services, is a big believer in health information technology and electronic health records (EHR). During her confirmation hearings, she stated that, â''A nationwide interoperable health IT infrastructure is a fundamental building block for broader health reform."

In fact, the Obama Administration appears to be counting heavily on the $36.5 billion buried in the $787 billion stimulus package aimed at creating such a national EHR infrastructure to go a long way towards reaching its goal of reducing the cost of health care by $2 trillion over the next decade. The belief is that a national EHR system will reduce administrative costs, eliminate needless medical procedures, and focus medicine on preventative care.

However, as my colleague Allan Holmes at Government Executive magazine pointed out late last week in the Tech Insider blog, the supposed cost savings may be more wishful thinking than reality, at least in the short run. Financial benefits most likely will take decades to accrue; in fact, the first decade of a national EHR network will likely see a negative benefit of $17 billion.

Robert O'Harrow has a long and must read story in this weekend's Washington Post about the behind the scenes maneuvering to get EHR support into the stimulus bill. The story describes "how the economic crisis created a remarkable opening for a political and financial windfall: the enactment of a sweeping new policy with no bureaucratic delays and virtually no public debate about an initiative aimed at transforming a sector that accounts for more than a sixth of the American economy."

The EHR lobbying organizations insist they are only interested in improving the quality of health care, and not lining the pockets of the EHR companies they lobby for (or pay their bills) - just like defense contractor lobbying groups insist they are only looking out for the national defense.

As the Post story notes, "the risks of the technology plan are high because of the haste with which it is being implemented and the special interests seeking to profit from it."

Even if we give the EHR lobbying organizations the benefit of the doubt, the problem remains that the US government views EHRs first and foremost as a means to reduce its cost of health care. The Bush Administration saw EHRs, for example, as "a key part of saving Medicare" by being able to reduce its spiraling costs. I see nothing that indicates that this cost cutting priority has changed any in the Obama Administration.

Finally, only a few people seem to be talking about the fact that the implementation failure rate for EHR projects run between 35% and 50%, and that nearly 20% are de-installed after being installed.

Well, I guess one way is to view the failure rate as not a risk but an opportunity: in essence it helps turn the $36.5 billion EHR stimulus into a $70 billion plus stimulus.

John Maynard Keynes would be pleased - it is just like digging holes and filling them in again.

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