Two influential economists yesterday told federal lawmakers that the widespread implementation of e-prescribing tools and electronic health records may only have a marginal effect on savings -- and could conversely result in increased costs.
Robert Reischauer, president of the Urban Institute, and Eugene Steuerle, a senior fellow also from the institute, both challenged industry estimates that adoption of health information technology could trim billions of dollars from ever-rocketing healthcare costs.
Reischauer and Steuerle's views run counter to the widely held belief that adoption of EHRs and other high-tech gear would produce almost immediate savings across hospitals and physician offices alike. A 2005 study by the RAND Corp., for instance, said that over time roughly $371 billion could be saved by a reduction in inefficiencies and by the delivery of higher-quality care.
While few argue against health IT adoption, more and more health experts have begun to question previous savings estimates.
"I don't think we know, on net, if it will save money," Steuerle told members of the Senate Budget Committee on Jan. 30.
Still, both economists agreed that health IT would quickly deliver on its promise to make the healthcare system safer and more efficient. "The question on cost savings is tentative," Steuerle said. "But (the question on) efficiency is not."
Reischauer, who is vice-chair of the Medicare Payment Advisory Commission, said he agrees. He said that while health IT will lead to significant improvement on quality -- and would lay the groundwork for a pay-for-performance program -- the jury is still out on how much money will be saved.
Reischauer predicted that even though health IT would be used to combat areas of redundancy in hospitals and doctors' offices, the resulting savings likely would be small.
The discussion was part of a broader dialogue on ways the federal government could help rein in a skyrocketing budget. "Since so much of our long-term budget shortfall can be attributed to rising healthcare costs, healthcare reform has to be at the heart of any solution," committee Chairman Kent Conrad (D-N.D.) said.