An Open Letter to the Obama Health Team on Health IT Spending

By David C. Kibbe, MD MBA and Brian Klepper, PhD

It seems likely that the Obama administration and Congress will spend a significant amount on health IT by attaching it as a first-order priority to the fiscal stimulus package. We take the President-elect at his word when he recently said:

"…we must also ensure that our hospitals are connected to each other through the Internet. That is why the economic recovery plan I’m proposing will help modernize our health care system – and that won’t just save jobs, it will save lives. We will make sure that every doctor’s office and hospital in this country is using cutting edge technology and electronic medical records so that we can cut red tape, prevent medical mistakes, and help save billions of dollars each year." (December, 6, 2008)

Whether the health IT money is well spent will depend on how it is distributed and what it buys. Most observers suppose that federal health IT investment dollars will be used to help doctors’ offices and hospitals acquire and implement electronic health record systems (EHRs or EMRs). These are commercial software suites for entering, storing and managing patient health data within a practice or health organization.

We agree that some of the federal health IT money should go to purchase EHRs, especially to doctors and hospitals in rural and under-served areas, which otherwise could not afford them.

The Easy, Wrong Solution

The easy solution would be to spend most of the health IT funds on EHRs. The EHR industry has made it easy by establishing a mechanism to "certify" EHR products if they incorporate certain features and functions.

But the easy solution would not be the right one. EHRs still are notoriously expensive. Often, practicing physicians do not consider many of the features and functions to be useful or important.  It can cost as much as $40,000 per physician in a medium size medical practice at the beginning of an EHR implementation. Even that regal sum may not completely cover the hardware and technical support necessary.

EHRs can be difficult to implement, upsetting practice workflows. In general, physicians’ practices have not adjusted quickly or smoothly to the disruptive nature of the switch from paper to electronic systems for patient care. Implementations can take months or even years to stabilize.

And the turmoil associated with the implementation can often have negative revenue repercussions for the medical practices they are intended to help. Physicians routinely report that, during the adjustment period, the number of patients they can see and treat in a day drops by twenty to thirty percent, with a commensurate decline in revenues.

Nor is there conclusive evidence that the use of EHRs improves patient care quality.

Finally, EHRs from different vendors are not yet interoperable, meaning that patient information cannot yet be easily exchanged between systems. If America’s physician practices suddenly rushed to install the systems of their choice, it would only dramatically intensify the Babel that already exists.

These barriers to adoption are well documented; they form the wall that has kept physician EHR adoption overall to less than 25 percent in this country. Even if a hefty federal subsidy reduced the exorbitant cost of the EHRs, many practices would suffer severe negative business impacts, and primary care access could temporarily be reduced on a national scale.

So important as EHRs are, at this point there are far better ways to invest in health IT for the doctor’s office and hospital. These approaches are low cost and would have immediate high impact on the quality and safety of care. They could build on and utilize existing health IT infrastructure, and be relatively non-disruptive to practice workflows. These factors would encourage adoption by minimizing risk for the doctors, their staffs, and their patients.

E-prescribing As A Model

The success of e-prescribing – as health technology and as public policy – make it a model for future efforts. E-prescribing uses computing devices to enter, modify, review, and communicate prescription information. The entire process can be automated, from a prescribing doctor’s fingertips on the keyboard to the receiving pharmacist’s view of the medication order on his/her monitor. All this is possible through the use of standards- and web-based software that is free or inexpensive to the medical practice.

The only technology required of the doctor is Internet connectivity and access to one of the popular browser software programs, like Internet Explorer or Mozilla Firefox, which are already present in most offices and clinics around the country. E-prescribing takes advantage of this existing infrastructure, which is why its adoption is growing rapidly, particularly after CMS authorized an incentive payment to e-prescribing physicians of 2 percent of their total Medicare allowed charges during 2009.

E-prescribing has succeeded because it is an incremental and low-risk health IT that made it easy for physicians and pharmacists to electronically share prescription data, and because it was encouraged by financial incentives. E-prescribing produced significant benefits to physicians over the short term, but simultaneously provided a pathway to more comprehensive IT use over time. It also avoided a sharp decline in access to primary care.

More Bang, With Less Turmoil, for the Buck

We believe that the Obama administration could leverage IT spending in similarly inexpensive ways. Smaller, incremental steps would likely impact a larger number of medical practices in the short-term, benefiting patients while limiting the disruption to doctors.

Here are three suggestions:

1) Referral Management . No patient ought to be referred from a primary care provider to a specialist unless the relevant personal health data is available. Yet, as often as half of the time the paper work arrives, if it arrives at all, after the patient’s specialist appointment. This wastes time, results in duplication of tests, medications and procedures, and may imperil personal health.

Care can only be coordinated and continuity assured if information follows the patient wherever the next care event will occur. The solution is relatively easy and no more difficult than e-prescribing.

Create financial incentives for the implementation of simple tools that allow doctors and practices to share health data and communicate with other doctors. It should start with the specialists to whom they refer patients, and include the specialist when (s)he returns the patient to the primary care physician. A 1-2 percent bonus to doctors who e-refer would significantly increase continuity of information among doctors, which would translate to better continuity of care for patients, and lower costs to the system.

2) Patient Communications. Patients want and deserve to communicate through secure email with their medical home practices. They also increasingly want to use the Web to schedule appointments, pay bills and view portions of their medical records, such as lab results. These online services are not expensive for medical practices to provide through companies that offer them as "web portals" and they offer more than convenience to patients.

These communication tools are a means of closing the "collaboration gap" that exists between busy physicians and their busy patients, allowing routine tasks to be moved outside the rushed seven-and-a-half-minute office visit. This gives consumers time to digest and reflect upon how best to meet their health and wellness goals and offers doctors the luxury of better-informed patients. While some consumers are willing to pay their doctors an additional monthly fee to obtain these online services, a small payment from Medicare similar to that offered for e-prescribing would make the business case for doctors’ adoption of these patient-friendly online services. Adoption would surge.

3) Infrastructure Build-Up and Maintenance. Nowhere is access to the Internet more essential than in health care. We must assure that broad band Internet connectivity reaches every medical practice and every home in America, no matter how rural a region or how low income a neighborhood. Currently there are too many areas in the country where cable and DSL do not reach, often due to the small numbers of subscribers and the consequent barrier to investment by network carriers this imposes. The federal health IT initiative should subsidize both the establishment of broadband service in those areas, and the subscription fees for low income and health disparity populations that could benefit the most from Internet connectivity with health care providers and online care services.

The new Administration and Congress are about to throw a lot of money at the Health IT problem, and the conventional thinking is to buy everyone an EHR of his/her choosing. While we enthusiastically applaud the vision that this represents, a more measured approach would create a smoother and more productive transition. At the same time, it would signal the EHR industry that, for national deployment, they need to come to terms with issues they have avoided so far, like interoperability and cost.
David C. Kibbe MD MBA is a Family Physician and Senior Advisor to the American Academy of Family Physicians who consults on healthcare professional and consumer technologies. Brian Klepper PhD is a health care market analyst.

12 thoughts on “An Open Letter to the Obama Health Team on Health IT Spending

  1. David, Brian
    While I agree that referral management, patient communications, and Infrastructure Build Up could be HELPFUL, they are INSUFFICIENT.

    We need to tackle INTEROPERABILITY head on. This is a NECESSARY prerequisite to getting bang for our health care IT dollars.

    I understand this complicates the issue greatly and is not easily understood by Obama staffers and the general public. I understand this will require tackling CCHIT and vendor business model incentives, but there’s no better time than now.

  2. Vince, you are right on the target. “Interoperability” through the web is the most efficient in my opinion. Lower overhead for everyone. Now my one question: “Where should the stimulus incentives focus on? Physicians, vendors or both?”. Linh.

  3. Vince: I couldn’t agree with you more, there’s a chicken and an egg, and they’re really quite inseparable. Question: who is doing, and who should be doing, the work on interoperability? Fact: a lot of work is being done in the field by many different companies, including Google and Microsoft, that we don’t hear much about. In the small world of health care IT, all the attention on interoperability standards has gone to ONC and HITSP, pretty thinly disguised HIS vendor driven groups, as one observer put it recently. Their work on standards is “normative,” that is, it focuses on what should be, or what should be according to their own biases. The work going on outside Washington, in the trenches so to speak of the business of health care data exchange, is much more practical and focused on “what will work?”
    So, perhaps we ought to try to get at this layer of work being done and report on it sometime soon. DCK

  4. I was just reading on MSNBC today about online access for healthcare. As EMR adoption makes big gains in healthcare, a new trend is emerging in the form of internet-based Personal Health Records (PHR), which will vastly influence the healthcare industry. Patients can obtain information, such as laboratory results, radiology reports, medication lists, and culture test results with the click of a mouse. A new report from Kalorama Information, “U.S. Markets for EMR (Electronic Medical Records) Technology,” notes this trend and examines how the focus of ownership of medical records is shifting from one that is distributed among various healthcare providers to one that is shared and controlled by both the patient and the provider.

    Patients’ and physicians’ interest in viewing records online has increased, since giving patients online access to their own charts is expected to enhance the doctor-patient relationship and reduce healthcare costs.

    “The driver for EMR sales has always been hospital-side, as in ‘this can reduce your costs,'” said Bruce Carlson, publisher of Kalorama Information. “That’s still true, but with PHRs, the driver is also on the consumer side, as in ‘this can make your organization seem friendly and modern to healthcare consumers.'”

  5. I think this letter captures much of what is needed to improve the health system now, but could be simplified by the single concept of improving “COMMUNICATION” (beyond just telephones). Most of the other capabilities discussed here and in replies are either a technological or operational extension of this primary function. One of the great embarrassments of our health care system is the marked inability of care givers to communicate (that is the ability to share relevant health information) with each other and the even greater gap in “provider-patient” communication capabilities. Frankly speaking, the majority of ‘useful communication’ is quite possible without the capital I Integration – which is a never ending boondoggle, an endless money and efficiency pit.

    The internet is the great connector. Physician practice portals go a long way to enabling exactly this kind of communication and are extraordinarily inexpensive – in fact should almost immediately start reducing overall practice expenses (including the cost of the portal). Even (secure) email alone would be a giant step forward if widely used.

    Patients expect and deserve the efficiency, access and immediacy of provider and health system communication – nothing more than the same kind of access they have now to their banks, airlines, other businesses, retail and services including the DMV!

  6. Simple workflow changes, associated with evidence-based improvement strategies result in quick uptake of improvement in IT.

    Incentives should be aimed at what has been proven to improve care, based on real-world experience. Incenting premature standards (standards in rapidly evolving ecosystems – in this case healthcare AND technology)can thwart innovation.

    Solutions available now cost less than $100 / month / physician – and can be commercially viable at lower rates with higher volume – and they improve care.

    E-prescribing + Patient Specific Point-of-care Decision Support (paper or electronic office) + Population Registry (performance reporting and outreach – patients who need attention).

    Without e-prescribing, the cost is much less.

    Incentives exist for using the systems already – Medicare offers a 4% (2% for e-prescribing and 2% for Quality Reporting) bonus in 2009.

    For PQRI 2008 DocSite saw an increase in its userbase of small physicians with more than 1000 new physicians signing up in the last 3 months of 2008 — They collected patient specific (evidence driven decision support) data at the point of care, creating a snapshot of provider performance and patient outliers. Additionally participation in the initiative results in submission of the data to CMS for bonus payment.

    The same technology, with ongoing clinical use, has improved care at large PHOs (A1c in poor control from 26% to 12% in 3 months); small practices over time (A1c in good control from 42% to 57% in under a year, perfect care from 4% to 8% in 8 months in a community cohort). The system (and others like it) scale across interoperable state system (DocSite is part of the Vermont Blueprint for Health).

    In short, simple, evidence driven improvement systems exist, DocSite is only one of them to be sure. Most are web-native, and Semantically interoperable – that is they carry not only the medical data, but also understand the context of the data as it relates to the patient and the clinical workflow.

    Spending healthcare economic stimulus resources on simple, effective, affordable healthcare improvement systems can result in a rapid acceleration in HIT adoption and Care Improvement.

  7. To save money, and render better care, health care facilities should avoid using patients as human ATM machines. Enormous waste occurs when very expensive tests are run before getting all the facts and seeking a diagnosis through a meaningful interview process.

    I spent 3 days in the hospital recently and had every expensive test run on me you could imagine. Total cost $45,000. I only had to pay $2700 but the cost could have been much less for all if one of the doctors would have taken my information on medications I was taking and walked through possible side affects. I finally went off the medications on my own, without any doctors advice, and all the symptoms went away. An easy solution and I had to be the one who came up with it.

    Bigger is not always better and more care must be taken to avoid higher costs. It appears many health care facilities see dollar signs as soon as an insured person walks through their doors. This needs to be addressed with a heavy hand and controlled. This is the main reason our health care costs have gone through the roof.

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  9. You have no doubt read & probably memorized Walker 2005 article about the finances of EMRs. Bottom line: a nationally inter-operable HIT system, despite its high cost, would save multi-billions NET. Also, a partially implemented piece-meal system would LOSE money.

    For you and I in the trenches, a user-friendly system would have four add’l huge advantages.
    1) Reduce the hassle and reduce the hemorrhage of providers out of healtycare.
    2) Reduce both errors and redundancy rates.
    3) Improve quality through learning. Large databases to tell us what works & what doesn’t.
    4) Improved surveillance of both natural epidemics and potential bioterrorism threats.

    As I wrote a while back (, we need to stop focusing o the difficulties and the immediate cost, and, as Nike constantly exhorts us, “Just Do It!”

    PS. For those not in healthcare, please see the section on medical IT in my forthcoming (next month) book titled “Uproot Healthcare.” For the lay person, it explains why medical IT is (as the section is titled) Both Blessing and Curse.

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