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1/25/2011
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Health Systems Underestimate EMR Costs

Accenture study finds that IT expenses increased 80% during electronic medical records system implementation, and higher costs are sustained over the long term.

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According to a study by Accenture, most health delivery organizations underestimate the time and costs associated with implementing advanced electronic medical record (EMR) functions, including clinical order entry, nursing and physician documentation, clinical decision support, and bar-coding medications.

Released last week, the study, "Secrets of Success on the EMR Journey to Meaningful Use: Leading Hospital CIOs Reveal Key Lessons Learned," also found that hospitals will experience significant spikes in operating costs during the period of time that they install EMR systems.

Accenture said it interviewed 15 CIOs who work at healthcare delivery organizations that are advanced in their EMR implementations and used quantitative benchmarking to identify six key insights that can help health delivery organizations successfully adopt their EMR technology. These are:

1. EMR planning and implementation must be a strategic initiative, not an IT initiative. Having the passion, influence, engagement, and attention of a hospital system's leadership from the outset was consistently cited by study participants as a success driver.

2. It takes longer and costs more than most anticipate. Most of the participants in the study underestimated (by nearly 100%) the time and costs associated with implementing advanced EMR functions.

3. IT operating costs will spike, and managing them requires leadership alignment and patience. Benchmarking shows that hospitals experience an 80% increase in their IT operating expenses while transitioning to EMR. This translated to IT operating expenses accounting for a larger percentage, nearly 200 basis points more, of the hospital's overall operating budget. Evidence also suggests that these expense inflections are sustained over the long term.

4. The war for health IT talent is on. There is a significant shortage of qualified health IT professionals to meet the demand associated with EMR implementation and support. Nearly every CIO interviewed noted unfilled positions and expressed concern about how their health system would source enough talent from the marketplace, including from EMR vendors, to meet longer-term demands.

5. Supporting EMR means thinking differently about capability and operating model needs. Hospital CIOs noted the need to think differently about capabilities required to support frontline EMR users, as well as to drive optimization of EMR-derived data through health analytics. In terms of support (training, service, and troubleshooting), the average hospital had to increase the number of full-time employees focused on healthcare IT support by 45% as it reached mature levels of functionality and adoption.

6. Creating a culture for adoption is essential. To achieve meaningful use, 75% of the clinicians in a hospital must, among other things, demonstrate consistent use of advanced EMR components, which include computerized physician order entry (CPOE), physician documentation, and closed-loop administration. Every CIO interviewed talked about the need for a sharp focus on change management and workforce engagement to ensure that key stakeholders, particularly physicians, get behind the effort and understand the benefits of using these components.

The report concluded that in order to facilitate a more effective EMR implementation process, hospitals should create a dedicated position -- the chief medical informatics officer (CMIO) -- to serve as a bridge between the healthcare IT organization and the hospital's clinical and business operations.

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