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The Cost of Health Information Technology

September 11, 2016

From the mid- to late-2000s, lots of pundits got into the business of shoving electronic medial records (EMRs)down doctors’ throats. There were a few incentives from the Feds to help with the upfront costs, but it was a pittance of what it really costed hospitals and physician practices. And there was no consideration made for the ongoing costs of EMRs, except for cuts in already skimpy Medicare and Medicaid payments if doctors and hospitals didn’t jump on the silicon bandwagon.

A recent estimate from the Medical Group Management Association  is that health IT, including hardware, software, IT support personnel, and licensing fees, costs $32,500 per physician, which is 40% higher than 2009. No payer has increased its fees to cover these costs. There are about 800,000 practicing physicians in the U.S. So (rough estimate) assuming this IT push has been going on about 10 years, and adding in the upfront costs, this means that the U.S. has spent about $250 billion on EMRs; $25 billion per year in ongoing costs.

And what have we gotten as a country from this top-down mandated expense? A meta-analysis of computerized decision support EMR tools found no difference in mortality or total cost of care, and some decrease in chronic disease morbidity, though “selective outcome reporting or bias could not be excluded.” A qualitative study of the role of EMRs in primary care found that EMRs can improve or worsen patient safety, especially when they “override the opportunities for face-to-face communication.”

I am not a Luddite. I do not have a blanket distrust of electronics. I own a recent-model smart phone. But ask yourself this: If EMRs were so great and we live in such a technophillic country, then why didn’t EMR use naturally spread like smart phones or i-pods? Why did outsiders feel the need to force us to use these klunky tools?  It’s simple. They cost a fortune, merely create extra mostly useless work for front line caregivers to do, and improve little to nothing in our ambulatory care. I wish we could put the genie back in the bottle and start all over. Hey, a guy can dream.

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2 Responses to The Cost of Health Information Technology

  1. Peg Graham on October 17, 2016 at 2:37 pm

    I know you’ve struggled to be balanced in your criticism of EMRs, but as a taxpayer, I too wonder why $27B of federal monies flowed to hospitals and physicians, which in turn led to too many vendor choices for MD offices that didn’t work and clunky, awkwardly designed Graphic User Interfaces that frustrate Clinicians, aren’t yet really about patients but still primarily designed for billing and documenting compliance with various quality measures. The reason why outsiders had to force this issue is because the industry is so insulated and resistant to change that without this infusion, and all the concomitant drawbacks, we would be even further behind than we are. Let me ask: Why am I STILL filling out paper forms? Why aren’t hospitals acting as the steward of my healthcare records, leaving me to decide who can/cannot have access, allowing me to direct sharing as it makes sense for me? So, yes, physicians should be frustrated but if there were less resistance and more time spent improving, we could move so much more quickly. Hospitals are creating efficiencies and replowing those dollars into operations – why not insist that they direct funding to improve interface, interoperabiity and create a connected healthcare system. They should be transparent about pricing, and should stop using the EMR as a barrier to exit/entry and compete on quality.

    • Richard Young MD on October 24, 2016 at 8:40 pm


      My quick response is that EMRs were created to improve hospitals’ and some doctors’ financial performance. Everything else is secondary. The regulations just reflect this reality.

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