Expanding Health Information Technology in the United States

Darrell M. West
Darrell West
Darrell M. West Senior Fellow - Center for Technology Innovation, Douglas Dillon Chair in Governmental Studies

May 20, 2009

During my last physical exam, I was pleased to see my doctor pull out a handheld computer. Since my regular checkup the preceding year, she had joined the small group of American doctors using electronic medical records. Complimenting her on this, I asked about my 26 years of medical history that resided on paper in her filing cabinet. She laughed and said, “we are not entering them in the computer. That would take too much staff time and money!”

The story illustrates the opportunities and pitfalls awaiting President Barack Obama as he seeks to expand use of health information technology. Armed with $19 billion in new money from America’s Recovery and Reinvestment Act, his administration hopes to employ health information technology to improve medical treatment, cut costs by reducing errors and redundancies, and empower patients by giving them control over their own medical records.

Based on the current situation, though, it will not be an easy task. The most fundamental problem is that not many doctors use electronic medical records. Comparative studies reveal that American medicine lags far behind other countries in utilization of digital technology. For example, 59 percent of the health providers in the United Kingdom and 80 percent of those in New Zealand rely on electronic records, compared to 17 percent in the United States. In hospitals, the U.S. numbers are even worse. A recent study found that only 9 percent of American hospitals rely on electronic health records.

America trails other countries in digital medicine because we have few agreed-upon standards for medical software, there is a divide in access to high-speed broadband for digital imaging, and implementation costs are borne almost solely by medical practices. The lack of national technology standards means 1,000 flowers have bloomed and few of the computer systems can talk with one another. When patients move from one health provider to another, it often is impossible electronically to transfer their medical records.

In the United States, the high cost of technology conversion falls entirely on health care providers. According to a study of electronic medical records in primary care, installation of digital records costs $13,100 per provider, including software, hardware, supportive, and maintenance. This investment eventually pays off in savings on transcription, billing, and administration, but it takes several years to recoup this up-front expenditure.

Progress has been slowed by divisions over who owns medical records — patients, doctors, or hospitals? This question matters because many companies have proprietary systems that do not always connect well with other systems. Policymakers have to decide whether to build on existing structures or have Internet-based platforms clearly controlled by patients.

What is needed to move forward is improved training of medical professionals. Orientation is crucial because surveys indicate that health providers find digital systems difficult to use initially. Most professional systems have multiple screens, varied options, and a variety of navigational approaches. Learning these systems involves considerable up-front time. In an industry with extensive time and cost pressures, these barriers make it difficult to implement this kind of digital improvement.

One case study of an internist practice that implemented electronic medical records found that the total cost of the new system was $140,000. Both staff and doctors had to undergone detailed training on data entry and system maintenance. Midway through implementation, their system was attacked by a virus that led to extensive time drains on the staff. Moving to the electronic system required a redesign of office work flow and daily routines. Although all concluded that the record-keeping transition was worthwhile, the doctors felt that small medical offices would not be able to adopt an electronic system unless financial assistance was provided.

The federal government has provided new incentives for doctors to adopt electronic medical records. In 2008, the Medicare program announced a trial program in which those providers who move from paper to electronic systems of record-keeping would receive higher Medicare payments to compensate for extra time taken to complete online prescriptions or test results. Individual physicians will receive up to $58,000 over five years to participate in the program. Those who have joined the program say they feel it has improved the quality of health care and helped them avoid treatment or prescription errors.

Even with $19 billion in new federal resources, the obstacles limiting the utilization of health information technology will not improve unless financial, organizational, and technological barriers are addressed. The federal government needs to take a more active role in supporting technology innovation and broadband development. Market forces fragment the medical system and accentuate connection problems between doctors and patients.