Solo and small-group physician practices can receive financial benefits from the use of electronic medical records, but initial costs and financial risks may be higher than expected and quality-improvement gains may be less than expected, according to a report in the current issue of Health Affairs.
In a Commonwealth Fund-sponsored study, University of California San Francisco researchers performed an in-depth analysis of 14 physician practices that ranged in size from one to six full-time healthcare providers (including physicians, nurse practitioners and physician assistants) that had used an EMR system from 15 to 45 months.
"This is a good-news, bad-news report," said the report's lead author Robert Miller, a UCSF professor of health economics. "The good news is that at least some guys will find this a good deal, but the bad news is that there is limited quality improvement."
Initial costs ranged from $14,462 to $63,600 per provider -- including costs for hardware, software training and installation, and lost revenue from reduced productivity -- and averaged $43,826. Annual ongoing costs ranged from $5,957 to $11,867 per provider with an average of $8,412.
Annual benefits per provider ranged from $6,600 to $56,161 and averaged $32,737. The benefits were derived from an increase in coding levels; savings in personnel, transcription and paper costs; and efficiency gains that allowed providers to see more patients.
"These findings go against the prevailing wisdom that you have to be big to do this," Miller said. "Practices were able to code higher and that's one of the reasons these results are different than common wisdom."
Ten of the 14 practices were able to code higher, and the increased levels ranged from $3,040 annually per provider to $41,711 with an average of $16,929. This equaled 51.7% of the financial benefit realized in implementing an EMR system.
"If something stands out in this study, it was the increase in coding, because it's easy to do and it's easy to get benefit from," Miller said. "It also points out the deep disquiet physicians have about current coding."
Miller explained that many physicians believe they are undercoding, but they think that, if they coded at the level they are entitled to, they might be accused of cheating.
"I think that's probably a pretty prevalent fear," he added. "This takes the fear away, because they have the data to back it up."
Although the study showed positive effects from adopting EMRs, three practices faced considerable financial pressure. Two had billing problems that were EMR-related, with one practice not receiving any revenue for three months and the other nearly going bankrupt after not receiving payments for 10 months, according to the report. The third had to redo its billing for six weeks after experiencing a complete crash of its computer system.
"The hardware was dead and all the backups were going into the ether -- so they had no electronic data and no paper data," Miller said. "There needs to be more support to take some of the risk out of the equation so folks know that what they're backing up is actually being backed up."
This lack of support often meant that the level of success each practice experienced depended heavily on the technical and business acumen of the office's resident EMR "champion," according to the report.
"There needs to be additional support service to demystify what needs to be done and lessen the importance of the presence of someone who is all gung-ho" Miller said. "Look at it this way: A person doesn't have to be thrilled with technology to get online and order books from Amazon.com. It just has to be easy and worthwhile to do."
Lack of support also led to few quality-improvement initiatives among the practices. Few went beyond the basics in generating clinical reminders for specific patients. Only two practices generated performance reports and both of those were affiliated with external quality-improvement collaboratives, according to the report.
Miller said this finding suggests that quality-improvement organizations should get in the business of providing support services to small practices and, in effect, tutor them on the ways information technology can be used to improve care.
"Docs don't want to focus on IT stuff and reconfiguring their office and generating reports," Miller said. "They want to practice medicine."
While quality improvement lagged, the report noted that gains were seen in providers' quality of life.
Although providers reported working longer hours during the initial four months after implementation of EMRs, many eventually reported more personal time.
The report also said physicians enjoyed having remote access to their records because this allowed them to leave the office earlier, spend time with their family and then work later into the evening at home.
View the study abstract.