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Electronic health records prepare for their close-up
New financial incentives spark doctors, hospitals to ramp up digitization

http://www.marketwatch.com/story/cashing-in-on-electronic-health-records-2010-04-13

April 13, 2010, 12:35 a.m. EDT

y Kristen Gerencher, MarketWatch
SAN FRANCISCO (MarketWatch) -- Coming soon to a doctor's office near you: Electronic health records. But it may take longer to find out whether broader use of health information technology lives up to its acronym and becomes a HIT.

While a few patients already are plugged in, many more soon may be able to go online to review certain medical test results, immunization lists and summaries of their office visits. They may turn to their computers instead of their telephones to make appointments and request medication refills.

Doctors may see relief from burdensome paperwork and new digitized checks and balances that help them improve quality while preventing costly medical errors and needless duplication of tests.

Such is the promise of electronic and personal health records, which are poised to get a shot in the arm thanks to last year's stimulus package. Under the American Recovery and Reinvestment Act, health-care providers stand to gain Medicare and Medicaid incentive payments worth $14 billion to $27 billion starting next year if they use health IT in a "meaningful" way, a definition that's still evolving.

At issue are both the substantial potential benefits of electronic health records and new risks. While some experts hail the advent of EHRs as a long overdue modernization and source of cost containment, critics say they're better at helping doctors handle billing and increasing their pay than they are at meeting patients' needs. Some also warn that wider adoption of commercial EHRs may freeze in place ways of caring for patients that are fast becoming obsolete and say doctors in small practices still face steep transitional hurdles.

Even so, few dispute the need to make a bigger national push toward broader use of information technology in health care. The Obama administration has said it wants every American to have access to an EHR by 2014, the same year many of the new health-reform law's major provisions such as coverage expansion to more uninsured people start to take effect.

"We're going to have to find more efficient ways ... to meet the needs of the newly insured," said Ann S. O'Malley, a doctor and senior researcher at the Center for Studying Health System Change in Washington. "Health information technology will hopefully be one of the tools to help us practice more efficiently."

Others are more bullish given the amount of money that's on the table.

"We are at the beginning of the single fastest transformation of an industry in the history of the United States," said Glen Tullman, chief executive of Allscripts-Misys Healthcare /quotes/comstock/15*!mdrx/quotes/nls/mdrx (MDRX 21.89, -0.49, -2.19%) , an EHR supplier in Chicago, Ill., and Raleigh, N.C

Glenn Laffel, Boston-based senior vice president of clinical affairs for Practice Fusion, which provides an advertising-supported EHR that's free for doctors, agreed.

"We really think electronic health records are going to revolutionize care in terms of the quality physicians can provide," Laffel said. "It's going to reduce the errors physicians would otherwise make when prescribing medications."

Playing catch-up
The U.S. leads its international peers in the use of high-tech diagnostic equipment such as MRIs and CT scans, but it lags in adopting behind-the-scenes health-information technology.

While about 44% of American doctors have some element of electronic health record (EHR) working in their offices, only 6% have a fully functional EHR, according to an article published in the April issue of the journal Health Affairs. The portion of hospitals with fully operational ones hovers around 2%.

By contrast, primary-care doctors in Australia, the Netherlands, New Zealand, the U.K. and the Nordic countries make near-universal use of electronic health records, according to a 2009 report from the Organization for Economic Cooperation and Development.

Like the U.S., Canada also has low adoption, with just 37% of its primary-care physicians using EHRs, according to a 2009 study from the Commonwealth Fund, a private foundation in New York.

Some integrated U.S. health systems such as Kaiser Permanente and Group Health Cooperative have been health IT pioneers. The U.S. Department of Veterans Affairs has saved more than $3 billion from its health IT investments, according to researchers' estimates in a separate Health Affairs study.