Electronic Health Records: $150 Billion Over 8 Years


That's what one health economist is reporting it will cost to go digital with health records according to the site Government Health IT. Ouch.

Robert Miller, a professor of health economics at the University of California, San Francisco, acknowledged that his $150 billion ballpark estimate sounded like a large sum but called it "manageable" because it amounts to less than a 1 percent increase per year in the nation's total health care spending.

The majority of IT health care systems (not the medical technology used to care for patients, but the infrastructure and applications used to manage hospitals, records, patient data, etc.) are notoriously behind the digital times. When you look at some of these other figures from the same article, it shows you just how far behind we are as a country.

Fewer than 5 percent of doctors are using fully functional EHRs, Miller said, using figures recently reported in the New England Journal of Medicine. To equip the remaining 96 percent with EHRs will cost about $15 billion in capital outlays and $24 billion in new operating costs, he said. To those costs, he added about $20 billion for EHRs in nursing homes and the offices of other medical professionals, bringing the total to around $150 billion. However, he said the grand total could be as low as $100 billion or less because of offsetting increases in medical revenues and other factors.

Even at $100 billion, we certainly have a long way to go.

As Baseline reported recently, even when you give the general public access to manage their own health records electronically, the interest it garners is weak. The jargon for this market, used by the likes of Microsoft, Google and others with skin in the game, is known as "personal health records" (PHR). Someone sees a market here, and there's evidence that eventually, things will move in this direction. But, man, it has very slow adoption.

Over 50 percent of 1580 individuals surveyed in a Markle Foundation study (pdf) said they were either "not very interested" or "not at all interested" in using personal health records, with nearly 60 percent saying they were concerned with privacy and confidentiality.

As the detailed article from Baseline's Ericka Chickowski points out, along with the privacy concerns, there are some serious technological and regulatory hurdles, a lack of laws to enforce protection, and overall apathy at play, even though some large companies want their employees to use them to drive cost down. From the article:

Intel, Wal-Mart, Pitney Bowes and BP teamed up to create a non-profit organization called Dossia to support member employees' PHRs.

"The goal is to create the infrastructure that puts our employees' health data in their hands," says Colin Evans, president of Dossia. "We believe that empowering our employees to actually have data to become consumers will ultimately have the effect consumer pressure has in every other industry, to make it more efficient, more cost-effective and more effective, in general."

Once member employees opt into the system, Dossia collects their information from their health plans, their health care providers, labs, pharmacies and so on, and offers digital access to the patient. The patients then have control over who sees their information. Not only can patients share their PHR with their regular physicians, they can also use them for a range of online health care applications and services that are cropping up to serve those with online PHRs.

Would you use a personal health record? Do you think that the health care community will increase adoption of electronic health records?


4 Comments for "Electronic Health Records: $150 Billion Over 8 Years"

  • Joseph French January 07, 2009 12:51 pm

    PHR is a good idea whose time has come. However, security and privacy concerns are real. Adoption depends to a high degree on consumer confidence in the technology and companies involved. Very strong authorization and access controls need to be in place.

  • Jim Koontz September 19, 2008 1:22 pm

    While this concept sounds good there are some real concerns with privacy - Will HIPAA apply? Will insurers have access to these records and use them in their evaluation process to deny applicants or drop current insured? Could be good, but I'm always suspicious when outside agencies want access to my private records of any kind. It may be the future, but it needs to be one with some very stringent privacy controls.

  • Michael Rulli August 06, 2008 11:00 am

    I would use PHR's if the security is their and the individuals and companies providing the service were fully accountable and liable for security and privacy. I am currently using a service that provides info submitted by my physician on a CD that I can take with me when I travel.

  • john soderhom August 05, 2008 12:02 pm

    One key would be if we had our own records with when you travel --I'm only guessing that one of the more cost saving areas would be if you had been scheduled for a CT/Scan or test that cost xxx --the new Doctor would have to do another test --maybe view the Scan and save lots of Dollars--sooner the better that we can have our own records with us. Keep up the good work.

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