Meaningful Use Program: Why it failed and how to save it

a doctor works on his laptop

This post originally appeared on the U.S. News & World Report’s Policy Dose


Given the “epidemic of waste [that] blights the U.S. health care delivery system,” investment in health care information technology systems is a no-brainer. After all, doesn’t the magic wand of IT improve the efficiency of every industry it touches? Congress thought so, and, as a result, in 2009, it allocated $20.6 billion as part of the American Recovery and Reinvestment Act to encourage doctors and hospitals to adopt and use IT systems and migrate from their old paper records to the new electronic health record systems. 

Meaningful Use program

To decide who qualifies for these generous incentives, the Department of Health and Human Services, through the Centers for Medicare & Medicaid Services, designed a set of criteria called meaningful use, a three-stage compliance program that requires providers show they’re using electronic health records in measurable ways. To receive the financial incentives, doctors and hospitals must attest to reaching different stages of meaningful use.

The first stage of the program was designed to drive medical providers to adopt the records. As long as the government was willing to pick up the tab, doctors were willing to buy fancy electronic health record software and not worry about using it. Electronic health record vendors enjoyed an artificial market created by the billions of dollars of incentives included in the Recovery Act’s Health Information Technology for Economic and Clinical Health Act. The majority of providers successfully attested to this first stage and as a result, record adoption rates skyrocketed.

Why the second stage failed

Now that everyone had electronic records, the next stage of the program had to logically focus on using this technology. Unsurprisingly, the second stage was not welcomed in the medical community. As of February 2015, roughly a quarter of physicians had complied with the requirements of this stage. Despite the lackluster results of the second stage of the program, HHS has already proposed the rules for the third stage, which is primarily focused on health information exchange among providers. While my own research documents huge benefits of exchanging health information, I believe that before implementing more complicated rules and regulations, we should have a clear understanding of the reasons for which the second stage of the program has failed. Without learning from the past, the future will not be brighter.

Although policymakers’ hunch about the benefits of IT was correct, it failed to understand a nuanced condition under which this magic wand works: organic and voluntary adoption. Imposing these records on the medical community and forcing them to adopt and use this technology was destined to fail. Meaningful use is focused on adoption and use of electronic records as the final goal, which misses the whole point: that IT in health care, just like in any other industry, is a means to achieve the actual goal of efficiency. More importantly, meaningful use considers electronic health records as the only type of IT solution and ignores the fact that there are many other IT services that can help medical providers much more. The “one-size-fits-all approach,” as American Medical Association President Steven Stack put it, of meaningful use ignores the differences between physicians and incorrectly assumes that medical care is mass-produced in the same way by all physicians and thus only one IT solution best addresses the unique needs of many different types of medical providers.

Policy recommendations

Meaningful use should have been integrated with the capitated payment models, in which the medical providers are paid a fixed amount per patient and are rather encouraged to provide the best care at the lowest cost. The need to cut costs and increase quality would have driven medical providers to adopt a wide variety of IT solutions that specifically address their unique needs. HHS should have set efficiency as a goal and let medical practices to find out the best way to achieve it through health care IT of their choosing. Instead of mandating physicians to record the smoking statuses and vital signs of all patients, send them reminders about their follow-up visits, and communicate with them through secure electronic messages, meaningful use incentives could have been allocated to fund a wide variety of different IT solutions suggested by medical providers.

Using a small part of the incentives now used for meaningful use compliance, we can run a pilot project and test this idea. HHS should call for proposals for IT projects that each provider, based on its own unique characteristics, deems the best way to cut costs and increase quality. Just like research grants, these proposals can then be evaluated by a panel of experts and funded only if approved. This approach will open up the market for meaningful and innovative IT solutions that actually help medical providers improve their efficiency. Rather than being stuck with electronic health records as the only IT solution, we can have a national lab in which the performance of many different IT solutions will be tested. Medical providers will find their best way to be more efficient and will adopt the IT solutions that best fits their needs organically and voluntarily. Only then IT will work its magic in the health care sector.