Small physician practices inch closer to adopting electronic health records - July 5, 2010
Orlando Florida --Washington Business Journal - by Ben Fischer
After dismissing it as too expensive for years, doctors in small or solo practices are now closely evaluating their options to buy sophisticated electronic medical record-keeping systems due to a combination of government pressures and new products in the market.
However, independent physicians remain in a tough spot — knowing there are strong incentives to make the switch, but nervous about such a large investment in a software system during tough times, particularly when the options are tough to sort through.
“You’ve got to start doing something, but who knows which is the right one?” said Dr. Stephen Rockower, a partner in Capitol Orthopaedics & Rehabilitation LLC, a four-doctor practice in North Bethesda. “I tend to be one of the more computer-savvy people out there, and you know, I’m confused.”
Vendors have quoted prices from $24,000 to $120,000, and “they basically all look the same,” he said.
The federal economic stimulus package contains $19 billion in incentives for doctors who demonstrate “meaningful use” of electronic records by late 2011.
That’s the carrot. But a stick is coming too. Doctors will see penalties in government-funded insurance reimbursements if they haven’t gone paperless by 2015.
Health policy researchers and politicians have long argued that replacing paper charts with searchable, shareable databases could radically pare medical errors and shave significant costs. But with price tags in excess of $100,000 and a laborious implementation, physicians outside all but the largest group practices simply ignored it until recently.
On June 15, GE Healthcare unveiled a product specially designed for small practices. Records can be stored on GE’s own servers and are accessible through a low-tech Internet interface, decreasing the upfront costs.
In May, Adventist HealthCare of Rockville announced price deals with two computerized records manufacturers, eClinicalWorks and Allscripts, and said it will offer $200 monthly subsidies to medical staff doctors who buy them.
Part of the stimulus package included a one-time exception to the Stark laws, a maze of federal regulations limiting the financial arrangements between doctors and hospitals, to allow the subsidies.
After the $200 monthly subsidy from Adventist, doctors would face monthly fees between $300 and $500 to buy the systems. Chief Medical Officer Gaurov Dayal said the program, which should be up and running for a few doctors by August, will jump-start the integration of doctor and hospital records.
Dr. Robert Karp, president of the Montgomery County Medical Society and a cosmetic surgeon in Rockville, said small practices are beginning to face reality: Electronic records are a must.
“I believe eventually I will do this,” he said. If you’d asked me that a year ago, I would have said, ‘No, I’m not going to do it.’”
But physicians still have numerous concerns. The most expensive systems are completely unrealistic for financially unstable practices, Karp said, even with the government incentives. Also, there’s no guarantee that vendors today will be in business over the life of the product or that it will meet federal standards for “meaningful use.”
However, there’s a tremendous drumbeat from medical consumers and payers to force the transition. In April, the Consumers Union, AARP, the National Retail Federation and others wrote a letter to Health and Human Services Secretary Kathleen Sebeilius, urging her to reject requests from some medical groups to slow down the implementation timeline.
Early adapters
The 2009 federal stimulus package included $19 billion in Medicare and Medicaid funding for doctors and hospitals that switch over to electronic health records, with the most money available for those who quickly show “meaningful use” of a new software package.
Medicare EHR incentives: Doctors can receive up to $18,000 if they demonstrate “meaningful use” of the new technologies by 2011 or 2012 and can eventually earn as much as $44,000 over a six-year span. Doctors who don’t qualify until 2013 are capped at $39,000, those who qualify in 2014 are capped at $24,000, and physicians who start in 2015 or later will receive nothing. In 2015, doctors who don’t use electronic records are subject to a cut in normal Medicare payments.
Medicaid EHR incentives: The incentives are voluntarily administered by states, which might not start their programs as quickly as the federal Medicare program. Eligible doctors can receive up to $21,250 in their first year with electronic medical records, and $8,500 in each of the following five years for a total of $63,750. To qualify for these payments instead of the Medicare program, doctors’ patient loads must be at least 30 percent Medicaid funding (or 20 percent for pediatricians).
Hospitals are faced with similar incentives and penalty schedules, which will be determined through a formula considering patient volume.
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