Thursday, May 17, 2007

An EMR Mandate -- Let's Go!!

Yesterday's Boston Globe had an article describing a draft Massachusetts Senate proposal to "mandate that doctors and hospitals switch to electronic medical records within five years" (please see "Officials say state must curb health cost"). The article describes this proposal as "the most controversial" among a set of proposals focused on cutting the cost of health care in the Commonwealth.

I think that a mandate may be the best solution to the EMR dilemma that we face today. While EMR implementation is obviously occurring today -- and Massachusetts is fortunate to have higher use than most other states -- progress is spotty, slow, and in many ways, ineffectual.

There is a growing digital divide in health care delivery. Large systems like Partners and Harvard Vanguard (sorry, I just can't call them "Atrius" yet) have the organizational fortitude and financial resources to successfully invest in EMRs. However, smaller practices (those with 10 or fewer physicians), and particularly primary care practices, don't.

Nationally, only about 25% of small practices have an EMR; 5 years ago it was about 20%, so we're not getting anywhere fast with this group. Unfortunately for us patients, 90% of our outpatient care happens in small practices, not in the large, well-resourced ones. Thus, at the current pace of EMR growth, it's going to be a looooooong time before most of us get the benefits that EMRs have to offer.

The dilemma is that physicians in small practices don't feel a whole lot of urgency to invest in EMRs at present. That's because it costs a lot to get up and running on a good EMR (almost $40K per doctor), and there aren't strong incentives or mandates compelling them to move faster. Unlike most businesses, physicians can't pass the cost of capital improvements on to their customers. Yet, on the other side of the equation, they can't stop the benefits of those improvements from flowing to their customers either. It's a perfect recipe for under-investment.

A mandate would provide the urgency for EMR implementation that the market can't provide today. However, a mandate needs to be coupled with an approach to assisting physicians get over the hurdles that have prevented widespread EMR investment in the first place. Without such a bulwark, a mandate will be a complete disaster.

I believe that a mandate needs to be coupled with an approach that addresses five key questions:

  1. What is an "EMR"? This is still a nascent technology, and there are a lot of bad systems out there. We need to mandate that physicians implement only qualified EMR systems, and we need a way to facilitate that process.
  2. What does "implement" mean? EMRs are only valuable if they're used in a way that creates value. So a mandate needs to cover not only what they implement, but also how they use it once it's in place.
  3. Who's going to pay for this? An unfunded mandate will create chaos in the near-term, because you can't get blood out of a stone. If we don't create a funding mechanism that forces health insurers and employers to bear their share of the cost, we'll end up with a lot of physicians going out of business or leaving the state.
  4. Who's going to implement this? Retail EMR implementations have a 30-40% failure rate today. EMR implementation is hard, and the practices that need EMRs the most are the same ones who don't have the expertise to get it done effectively. In addition to funding, a mandate needs to be backed by an infrastructure that can assist physicians with rapid, effective implementation.
  5. What about health information exchange? One of the biggest problems with leaving EMR implementation to market forces is that the market doesn't address health information exchange, which is a pure "public good" that benefits society but that no one wants to invest in on their own. If we're going to have a mandate, it should include HIE, because that's where a lot of the value lies.

MAeHC has estimated that universal adoption would require that we outfit 8,000-10,000 physicians with an EMR who wouldn't otherwise get one on their own. We estimate that this would cost roughly $500 million if we include the cost of health information exchanges as well as EMRs (you need HIEs to get the cost reductions that everyone is looking for). This figure also includes the cost of an infrastructure to facilitate rapid and effective implementation. Spread this over 5 years, and it amounts to $100 million per year. Considering that we spend over $50 billion on health care in Massachusetts every year, this is a miniscule investment compared with the value that it will bring.

The universal health law will be merely a facade if we can't dampen health care cost growth. Indeed, current rates of growth threaten not only the universal health law, it affects all of our health care benefits. EMRs aren't a panacea, but they are key to ANY solution. That's why a mandate makes sense.

We are fortunate to live in a state that can actually provide practical solutions to make an EMR mandate effective -- there are few, if any, other states that can make that claim. An appropriately structured mandate that addresses the questions noted above will catapult Massachusetts into the next era of health care delivery and burnish our already well-earned reputation as a national beacon of health care innovation.


Anonymous said...

Government mandates will surely make this work: they so often have proved to be the most important force for real quality improvements in our society...<;

Dave said...

Nice to have you back. IMHO, we must solve the funding and support issues first, and only then consider a mandate. I would guess that once a critical mass of primary care doctors in a market are using an EHR, there will be a lot of competitive pressure for the later adopters to follow. Imposing a mandate before the funding and support issues are addressed will just increase the failure rate, however.

Micky Tripathi said...

Thanks for your comments.

To anonymous, it's certainly easy and sometimes funny to take such swipes at government, even when they are unwarranted. I can't think of a world without such successful mandates as Social Security, Medicare, clean air/water standards, telecomm standards, and auto/airline safety regs, just to name a few. The government has by and large done an excellent job providing for these "public goods" that would otherwise not be efficiently provided or provided at all by the market. The VA has also shown that the government is actually quite effective at using technology to cost-effectively raise the quality of care; most studies I've seen on the topic suggest that they've been much better than their private counterparts. If I thought the market was taking care of this problem I wouldn't support a mandate, but it's increasingly clear to me that the market will not adequately address this issue on its own. Of course, we could just admit the truth regarding healthcare -- federal and state government account for 2/3 of all health care spending, so when we pretend that the market is driving this sector, just who do we think we're kidding anyway?

To dave, I absolutely agree with you, which is why I said in the blog that mandates without answers to such issues would be a "total disaster." I believe that we in Massachusetts have a constellation of collaborative organizations that have enough experience in this area to provide the necessary foundation to support a mandate. I wouldn't support such a mandate in states that don't have a plan for addressing the key issues that you raise.

Sachi said...

A very precise analysis!!

Jeff said...

Where is the research that shows the money saved and the reduction in medical errors that are so freely attributed to EMRs? Most practices that successfully implement EMRs see fewer patients than before, but their net production increases. How is this a savings? In this time of dwindling primary care practitioners, I see EMRs as potentially creating unnecessary barriers to primary care. If we want to decrease health care costs lets tackle the big issues like universal core coverage so that all legal residents have access to at least a fair fee structure. Let’s fix the malpractice issue so that defensive procedures provided by physicians can be reduced. Not every bump on the head requires an MRI or CT. And finally, let’s start thinking about end of life issues. We are all going to die one day and if we, as a society, do not address this issue, there will never be enough hospitals and nursing homes to provide care. I see EMRs as another tool not the cure.

John said...

When it comes to health insurance, the plan that would hurt our economy the least is Hillary Clinton's plan. Everyone would have health insurance. WA, NJ, NY and a few other states who have already tried Obama's proposed health insurance plan of not mandating coverage. These states have driven out of the better insurance companies. When anybody can get health insurance without having to go through medical underwriting, people won't get coverage until they absolutely need it. Usually because of a serious illness. This causes health premiums to sky-rocket. That's because insurance companies are only paying claims for unhealthy people. The plans in these states tend to not be that great either. If everyone has health benefits, the premiums would be less because healthy people would factor in on determining the premium.

electronic medical records said...

Do you have any updates for EMR for this year? Thanks for sharing.