In Lowering the Costs of Healthcare Administration, EMR Is Not Silver Bullet But it is Helpful

Cheryl Jacque explores the promise that implementing EMR systems will lower the cost of healthcare administration. Cheryl, who writes and researches for http://www.healthadministration.org, a website that provides resources and the latest information on health administration, proposes that while initial costs of these new systems will run high, they may be worth it to the doctors, patients and industry executives who use them. Cheryl’s post adds to Middletown Mike’s post on how New Jersey women were recently granted access to preventive care and suggests that the new ICD-10 will allow for more affordable healthcare.

by Cheryl Jacque

Electronic Medical Records (EMR) have the potential to increase efficiency and quality of health care, but there are heavy costs and risks to overhauling the way an entire industry keeps and uses health records.

The healthcare industry is eating up new medical technologies, sometimes by choice, and sometimes by law. The U.S. government mandates that by 2013, the medical records coding system be updated to reflect advances in EMR. The new system of coding the ICD-10 will support new diagnoses and a more nuanced method of record patient conditions and statuses.

One benefit of this new system is that when two patients have the same condition but with more or less severe symptoms, this will be distinguished by code. If the EMR system can tell these two patients apart, then so can insurance companies, who will be able to make their pay scales more precise. Thus, the entire payment system, including Medicare and Medicaid, will become much more efficient in the end.

All participants in the healthcare industry stand to benefit from similar increases in precision, including the pharmaceutical industry. Not only will records become more nuanced, but they may also be on the way to becoming available in real time. The sheer quantity of data may exponentially increase, but that is an insignificant factor when compared to the improvements that this data and the management of this data will bring to the industry.

As pointed out by McKinsey & Company, what is called real world data (RWD) - records that attain this new level of quality - can be used to understand epidemiology trends, patterns in treatment and recovery, and to discover new opportunities to manage diseases. In addition, all stages of product development will gain new clarity, which will help pharmaceutical executives make better decisions along the way. The integration and analysis of real world data will soon allow pharmaceutical executives to more accurately estimate emerging trends will as they occur.

There are some downsides to the boom in healthcare technology. Already, it is plain to see that some healthcare providers are having trouble moving toward the digitization of records and information. For example, the date of the ICD-10 mandate has been moved back two years, due to complaints from providers that the costs of implementing these new technologies are too high.

To make matters worse, implementation of new systems always seems to require additional future costs, many of which are unexpected. For instance, earlier this year, The Economist reported a problem with clocks in Massachusetts General Hospital in Boston, which exemplifies these unexpected costs. Devices in the hospital each use individual clocks, so when readings are taken or procedures conducted, the time is automatically input according to the individual clock on each device. It was discovered that many devices were dangerously out of synch, which could easily lead to serious mistakes, such as repeated procedures, malpractice suits, or erroneous calculations by physicians. Now, talks are underway to set devices to an atomic clock, which would solve the problem, but also cost a lot of money to develop and integrate. Estimating the overall cost of switching to new healthcare systems is complex and impossible to predict.

Still, the sweeping changes that will result from technological advancement in EMR and in other areas of healthcare will undoubtedly help make the industry more efficient and increase the quality and efficacy of care. The results may be well worth the price.  

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