EHR Implementation Still Costs Too Much

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Hospitals have always had problems securing the initial down payment for electronic health record (EHR) implementation; a recently released poll from KPMG suggests that financing such projects remains an ongoing concern that promises to last throughout the implementation phase and beyond.

The recently released results of a May poll that surveyed more than 220 hospital and health system administrators found that while 49% of respondents are more than halfway to completing full EHR implementation, 48% of those polled said they are only somewhat comfortable with the level of budgeting their organization planned for EHR deployment. Nine percent said they weren't comfortable at all with their budget plans, while 18% said they were unsure. On the positive side, 25% said they were very comfortable with the funding they had for their EHR implementation project.

With the majority of those polled expressing some level of discomfort about how they will pay for their project moving forward, Gary Anthony, principal with KPMG Healthcare, said the poll findings suggest that healthcare executives miscalculated the costs of their EHR projects.

"Organizations underestimated the impact and the effort required to fully implement an EHR. They also underestimated just how transformative this would be to their organization as a whole," Anthony said in an interview with InformationWeek Healthcare. "This is the largest, most significant investment that a health delivery organization will go through. EHRs touch and change everything within the organization, and so I think [there's been] a lack of experience and a lack of understanding about the magnitude of the effort."

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According to Anthony, recent reports that Duke University will spend $700 million to implement its EPIC EHR indicates the staggering costs of an EHR implementation project. He also said these projects are associated with maintaining and storing additional terabytes of data and providing security capabilities that adhere to Health Insurance Portability and Accountability Act (HIPAA) requirements. Additional costs come with maintaining a robust network that allows doctors and other clinicians to access the data remotely on their iPads or smartphones.

The demand for skilled health IT professionals also impacts the way health delivery organizations are developing a strategy for EHR deployment. The poll shows that 46% of hospital and health system leaders indicated that they are using a multiple-resource strategy--a mix of using existing staff, hiring additional staffers with new skills, or engaging consulting services. Sixteen percent of respondents said they were leveraging existing staff, while 13% said they will hire additional staff, and 10% said they will secure third-party assistance. Anthony said clinical informatics workers who know specific EHR systems from vendors like EPIC or Cerner, and who are also capable of implementing EHRs in areas such as emergency departments or operating rooms, are in short supply. Anthony estimates that salaries for employees with health IT skills have risen substantially during the last two years, which also drives up implementation cost.

"There is a lack of skills in most health organizations around high-level project management disciplines. It's difficult to find people who know how to manage these very large-scale projects across the organization and who will implement the project on time and on budget," Anthony said.

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