Five Healthcare Information Technology Drivers

It is estimated that the healthcare reform bill that was released by the Congressional Budget Office will amount to $600 billion within a span of 10 years. If studies are correct that approximately 30% of dollar spent on healthcare is spent on diagnostics and testing, then the opportunity for an enormous cost reduction is definitely an attractive proposition not only for doctors, patients, and insurers, but also for the government who is planning to overhaul the system.

But the ultimate benefit will be to the American patient, which is why reforms are being pushed. I believe that essential to having good care is having complete and accurate information. At present, only 20% of doctors use computerized healthcare information. This means that these doctors have uploaded their patients' data on paper into the digital network that in any case one of these patients gets into an accident and health history needs to be accessed, then it will be just by entering his or her driver's license number. Many of these doctors who've bought into the system does not even know how to maximize its use. Getting into the system does not only require relearning effort but also is expensive for the doctors too that is why yet only a few are participating.

Benefits of healthcare information technology adoption:

1. Access to medical records will be faster and cheaper for the healthcare provider.
2. Complete and accurate health record of the patient.
3. More efficient delivery of care.
4. Can decrease time spent on administrative duties and increase time spent on direct patient care.
5. Enhance clinical decision making process.

Megatrend Drivers:

1. Obama administration proposing $50 billion for the Healthcare IT adoption.
2. Government incentives for action in implementing an electronic medical record (EMR) system and penalties for non-action.
3. 3) Out of 800,000 clinicians in the US, only 17% use nationally recognized electronic health record system.
4. Reimbursement systems like Medicaid and Medicare and other insurance and healthcare providers are now requiring healthcare IT adoption from physicians and hospitals.
5. Healthcare IT adoption outside the US is expected to increase too as standard of living goes up along with the need for better healthcare services.

Focus:

Estimates indicate that up to 80% of healthcare is delivered by small scale practices. These practices usually are made up of 1 to 5 physicians. Thus, expect that the bulk of the healthcare IT adoption funding to be given to rural hospitals and small scale physician practices. And because big players will somehow be disinterested in this fragmented market, their role is to consolidate those small players serving this market. Expect these big companies to acquire small players if they want to participate in the small practices market.

List:

• Computer Program and System (CPSI) - Small to medium market
• Eclipsys (ECLP) - Small to large market
• Cerner Corp. (CERN) - Large market
• Allscripts Healthcare Solutions (MDRX) - Large market
• Quality Systems (QSII) - Small to medium market

Disclosure: Bryan Gomez does not own any of the stocks mentioned in the article.

Comments

[jerry25:]

This is nonsense. We are a single doctor alternative medicine practice. EHR uses voice activated machine translation that is full of errors. Correction of those errors requires massive effort. In general doctors using EHR are taken shortcuts to save time and leaving out information that they don't want to be available to the government.

Alternatively the present paper charts are much more efficient and complete for most small practices. The space they require may be a disadvantage for some larger practices, but is not a reason subject a practice to the massive restructuring (scanning millions of documents) and becoming dependent on complicated computer technology at a small office facility. Loss of data would be a disaster. Only larger facilities already with IT staff should opt for EHR.

The Medicare mandate that was thrown into the stimulus package without anyone reading or knowing anything about and without exemptions for small practices, was a terrible mistake and an imposition on the medical field. It was doing the wishes of the Insurance Companies. The government wants to be able to check up on doctors and their patients more easily.

The only area where EHR is needed is for Radiology facilities, since they do most of the diagnostic tests as well as State Medicaid facilities since they are the most disorganized.

As a practice we will NEVER adopt EHR or we will retire first. It would destroy our practice. Unfortunately the voice of most doctors is not being heard on this issue.

Sep 01 02:00 PM

[Bryan Gomez:]

The wheels are turning. The dinosaurs get killed. Mosquitos survive. The government says it will save them a lot. It will automize parts of the practice. It will kill the practice. It used to be more tests just to avoid malpractice suits. This time, diagnosis will be because the system says so.

It is going to happen.

Sep 01 07:32 PM

[jerry25:]

Fortunately government takeover of Healthcare - that was supposed to begin with the Public ("Gov't") Option will not happen.

If only Sarah Palin would learn about what is going on, she would alert the world about the Gov't intrusion in patient/physician care via controlling personal medical records.

EHR Ain't happening to this practice. We will eat up the 4% Medicare penalty if they even dare enforce it after 2014. Medicare doesn't even pay for our Alternative Medicine services, so we couldn't care less if they threaten to penalize us.

The ironic thing is that we are practicing the type of medicine that experts say our society should be headed towards - Alternative, Functional Medicine, Acupuncture to treat the actual problem, not the symptoms as Western Medicine does - and we get people OFF of medications that aren't doing any good.

We are no dinosaur. We are the future that Obama is hurting.
No wonder that Independents and Democrats such as ourselves are turning against him.

Paper Charts will survive until the Star Trek age, when Cyborgs will be able to do everything.

Sep 01 10:33 PM

[Bryan Gomez:]

Digitizing healthcare data is a push towards medical consumerism. America is all about choice and I don't think this limits their choice. But if you think that this is all about preventing doctors to do what they do, then that is your opinion. I don't think they would be doing this if everything is working well and everyone has a healthcare insurance.
From what I see, America is socializing healthcare. Everyone has to have it. And I believe in that. The marginalized has to have a health security blanket somehow and those who can pay always has a choice.

Sep 01 11:47 PM

[Dan Jacome:]

"approximately 30% of dollar spent on healthcare is spent on diagnostics and testing" -WHAT IS YOUR SOURCE HERE?

**** 30% of every health care dollar goes to hospitals (inpatient/outpatient) from what I have read (CMS, MedPAC, etc)

Sep 02 02:44 AM

[jerry25:]

When a small health care provider such as a startup doctor or even an acupuncturist is going to be told by Medicare or their state Medical Society that they are non-compliant if they don't purchase $44,000 software/hardware that requires everything one does to be dictated or scanned into a computer, with the assumption that will provide better healthcare, there is something wrong with our society.
There are additional costs necessary every year, not to mention the inconvenience of not having a portable paper chart.
Machine translations have way more errors that hand written notes by the provider. That was the excuse to do this. Medicare wants to be able to confiscate your CDs to control doctors.

The fact is what happened was Barney Frank / Nancy Pelosi types wrote the legislation (in the stimulus package without anyone reading it or discussing it) without consideration for small practices who do not have any problem with errors or providing good healthcare. They should have first tested it out with their own Government Agencies such as the VA Hospitals and State run Medicaid facilities as well as the Radiology facilities that are actually doing the Diagnostic tests.

If Obama wanted to do some good, he could instead educate patients to keep their medical records (of important tests) and encourage providers to cooperate in this effort. You would not believe how ignorant most patients are with their health history. That can be corrected easily and that would accomplish much more that what Obamacare is trying to do with EHR for small practices.

Sep 02 08:27 AM

[Bryan Gomez:]

Stimulus fund should go to small practices.

Sep 02 11:35 AM

[jerry25:]

EHR mandates should never have been in the Stimulus package. It was a sneaky way to get some of Obamacare in place before beginning Healthcare "reform".

Stimulus money was supposed to be spent for 2009/2010 in order to get us out of the recession. The EHR takes place from 2012-2014 when the funds get distributed. How is that stimulus?

For those who don't know it, there was also about 80 billion or more in Medicaid funds for 2013 and after (I don't recall the number, but then not even Republicans have brought this up).
Medicaid funding beyond 2010 should have been included in Healthcare reform. Obviously, Barney Frank/Pelosi weren't confident that Americans would want to pay for it later on, when they had time to debate the subject. Republicans were too incompetent to argue this point back in February (they don't read very well)

I agree that The Stimulus package saved us from near depression, but around $200 billion (out of $789 billion) could have been cut out and/or used for real job saving stimulus such as more infrastructure and money to States. It is no wonder that unemployment is so high and states are in trouble now as funds were diverted for Medicaid and EHR for later years.

Back to the $19 billion for "EHR" in the Stimulus package. I have no problem with some funds used to help facilities have better access to internet and associated equipment. It is mostly the larger facilities (eg Hospitals)/and State Health Centers that are in need of better computer equipment as well as more staff. There are definitely large busy family practices (3 or more providers) that need better ways to reduce all the paperwork that goes into paper charts. However, there are many products available for this and a one type $44,000 system that is being supported should not be the only answer. It should be voluntary. However, you can be sure anyone taking Federal funds has to do massive paperwork and agree to certain mandated conditions for EHR.

There should not have been any broad Mandates at this time (except maybe for Radiology facilities).

As I wrote before, there are specific ways to get better record keeping - Directly from the Radiology facility and from patients doing a better job to keep their own records of tests (Its called personal responsibility - a Republican concept).
EHR produces its own errors from bad machine translations, except these errors are even worse because they are typed and look official.
This is all experimental stuff going on.

Sep 02 01:42 PM

[IT is for S...:]

Say good night Jerry. You sound like a dinosaur and we all know how they loved change.


On Sep 01 02:00 PM jerry25 wrote:

> This is nonsense. We are a single doctor alternative medicine practice.
> EHR uses voice activated machine translation that is full of errors.
> Correction of those errors requires massive effort. In general doctors
> using EHR are taken shortcuts to save time and leaving out information
> that they don't want to be available to the government.
>
> Alternatively the present paper charts are much more efficient and
> complete for most small practices. The space they require may be
> a disadvantage for some larger practices, but is not a reason subject
> a practice to the massive restructuring (scanning millions of documents)
> and becoming dependent on complicated computer technology at a small
> office facility. Loss of data would be a disaster. Only larger facilities
> already with IT staff should opt for EHR.
>
> The Medicare mandate that was thrown into the stimulus package without
> anyone reading or knowing anything about and without exemptions for
> small practices, was a terrible mistake and an imposition on the
> medical field. It was doing the wishes of the Insurance Companies.
> The government wants to be able to check up on doctors and their
> patients more easily.
>
> The only area where EHR is needed is for Radiology facilities, since
> they do most of the diagnostic tests as well as State Medicaid facilities
> since they are the most disorganized.
>
> As a practice we will NEVER adopt EHR or we will retire first. It
> would destroy our practice. Unfortunately the voice of most doctors
> is not being heard on this issue.

Sep 13 07:29 PM

[Maximize401k:]

See va.gov/ (U.S. Department of Veterans Affairs) - digitizing medical records has helped transformed this erstwhile dinosaur into a model of efficiency in many respects.

Oct 14 09:07 PM

[Maximize401k:]

Forbes, Oct 12: The American Recovery and Reinvestment Act of 2009 allotted $787 billion to improve education, spruce up infrastructure and shore up energy reserves, all while priming the economic pump.

QSII: This Irvine, Calif., outfit sells software that manages electronic medical records. Should get a shot in the arm from the $20 billion in medical records subsidies enacted in last winter's stimulus legislation.

Oct 14 09:16 PM