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Unexpectedly! Part MMMXXI (updated)

In its early days the Obama administration avidly promoted financial incentives for the adoption of electronic health records by medical providers. According to Obama, the adoption of electronic health records would save $80 billion in health care costs. The use of electronic health records has been touted by the government (state and federal) for years. Financial incentives for the adoption of electronic health records by Medicare and Medicaid providers, however, were first funded through the administration’s trillion-dollar so-called “stimulus” program, rammed through Congress in February 2009.

At the time Drs. Jerome Groopman and Pamela Hartzband (both self-advertised Obama supporters) criticized the promotion of electronic health records essentially as a crock in the pages of the Wall Street Journal. Drs. Groopman and Hartzband were on to something. Yesterday’s New York Times reported that “Medicare costs rise as records turn electronic.”

The Times does not observe that we haven’t seen anything yet. We’ll be seeing a lot more of this as Obamacare is implemented.

UPDATE: A friend directs me to this WSJ article by Stephen Soumerai and Ross Kopel. My friend notes that the related letters to the editor are also interesting. Here is the text of the article:

In two years, hundreds of thousands of American physicians and thousands of hospitals that fail to buy and install costly health-care information technologies—such as digital records for prescriptions and patient histories—will face penalties through reduced Medicare and Medicaid payments. At the same time, the government expects to pay out tens of billions of dollars in subsidies and incentives to providers who install these technology programs.

The mandate, part of the 2009 stimulus legislation, was a major goal of health-care information technology lobbyists and their allies in Congress and the White House. The lobbyists promised that these technologies would make medical administration more efficient and lower medical costs by up to $100 billion annually. Many doctors and health-care administrators are wary of such claims—a wariness based on their own experience. An extensive new study indicates that the caution is justified: The savings turn out to be chimerical.

Since 2009, almost a third of health providers, a group that ranges from small private practices to huge hospitals—have installed at least some “health IT” technology. It wasn’t cheap. For a major hospital, a full suite of technology products can cost $150 million to $200 million. Implementation—linking and integrating systems, training, data entry and the like—can raise the total bill to $1 billion.

But the software—sold by hundreds of health IT firms—is generally clunky, frustrating, user-unfriendly and inefficient. For instance, a doctor looking for a patient’s current medications might have to click and scroll through many different screens to find that essential information. Depending on where and when information on a patient’s prescriptions were entered, the complete list of medications may only be found across five different screens.

Now, a comprehensive evaluation of the scientific literature has confirmed what many researchers suspected: The savings claimed by government agencies and vendors of health IT are little more than hype.

To conduct the study, faculty at McMaster University in Hamilton, Ontario, and its programs for assessment of technology in health—and other research centers, including in the U.S.—sifted through almost 36,000 studies of health IT. The studies included information about highly valued computerized alerts—when drugs are prescribed, for instance—to prevent drug interactions and dosage errors. From among those studies the researchers identified 31 that specifically examined the outcomes in light of the technology’s cost-savings claims.

With a few isolated exceptions, the preponderance of evidence shows that the systems had not improved health or saved money. For instance, various studies found the percentage of alerts overridden by doctors—because they knew that the alerted drug interactions were in fact harmless—ranging from 50% to 97%.

The authors of “The Economics of Health Information Technology in Medication Management: A Systematic Review of Economic Evaluations” found no evidence from four to five decades of studies that health IT reduces overall health costs. Three studies examined in that McMaster review incorporated the gold standard of evidence: large randomized, controlled trials. They provide the best measure of the effects of health IT systems on total medical costs.

A study from Regenstrief, a leading health IT research center associated with the Indiana University School of Medicine, found that there were no savings, and another from the same center found a significant increase in costs of $2,200 per doctor per year. The third study measured a small and statistically questionable savings of $22 per patient each year.

In short, the most rigorous studies to date contradict the widely broadcast claims that the national investment in health IT—some $1 trillion will be spent, by our estimate—will pay off in reducing medical costs. Those studies that do claim savings rarely include the full cost of installation, training and maintenance—a large chunk of that trillion dollars—for the nation’s nearly 6,000 hospitals and more than 600,000 physicians.

But by the time these health-care providers find out that the promised cost savings are an illusion, it will be too late. Having spent hundreds of millions on the technology, they won’t be able to afford to throw it out like a defective toaster.

It is already common knowledge in the health-care industry that a central component of the proposed health IT system—the ability to share patients’ health records among doctors, hospitals and labs—has largely failed. The industry could not agree on data standards—for instance on how to record blood pressure or list patients’ problems.

Instead of demanding unified standards, the government has largely left it to the vendors, who declined to cooperate, thereby ensuring years of noncommunication and noncoordination. This likely means billions of dollars for unnecessarily repeated tests and procedures, double-dosing patients and avoidable suffering.

Why are we pushing ahead to digitize even more of the health-care system, when the technology record so far is so disappointing? So strong is the belief in health IT that skeptics and their science are not always welcome. Studies published several years ago in the Journal of the American Medical Association and the Annals of Internal Medicine reported that health IT systems evaluated by their own developers were far more likely to be judged “successful” than those assessed by independent evaluators.

Government agencies like the Office of the National Coordinator of Healthcare Information Technology (an agency of the Department of Health and Human Services) serve as health IT industry boosters. ONC routinely touts stories of the technology’s alleged benefits.

We fully share the hope that health IT will achieve the promised cost and quality benefits. As applied researchers and evaluators, we actively work to realize both goals. But this will require an accurate appraisal of the technology’s successes and failures, not a mixture of cheerleading and financial pressure by government agencies based on unsubstantiated promises.

The Journal’s authors’ tag indicates that Mr. Soumerai is professor of population medicine at Harvard Medical School and Harvard Pilgrim Health Care Institute. Mr. Koppel is a professor of sociology and medicine at the University of Pennsylvania and principal investigator of its Study of Hospital Workplace Culture.

Walter Russell Mead has more here.

Recommend this Power Line article to your Facebook friends.

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