The Physicians’ Reciprocal Insurers (PRI) recently posted the results of a survey they did of 500 physicians regarding Electronic Medical Records (EMR) software and the EMR stimulus money and penalties. Here’s one of their most interesting findings about EMR implementation:

One significant finding was awareness of financial incentives and penalties for implementing EMR systems. While 85 percent of physicians were aware of the financial incentives for implementing the systems, more than 35 percent did not know that they face government-assessed financial penalties for not complying. The penalties are equal to a one percent reduction of the physician’s annual Medicare payments per year up to five percent. However, those penalties do not seem to be having the intended effect, as more than 65 percent of physicians who were unaware of the financial penalties said this would not cause them to implement EMR.

So, most physicians are aware of the financial incentives of implementing an EMR. This was a bit of a surprise for me, but I guess not a HUGE surprise. The more interesting part is the 35% of physicians that didn’t know about the Medicare penalties and that the majority of those people didn’t think that penalties would cause them to implement an EMR.

Does this mean that doctors won’t be implementing EMR? No, I think that we’re going to see a big uptake in EMR adoption over the next two years. One thing the HITECH act and EMR stimulus money has done is increased the awareness of the good and bad of EMR. This increased awareness will be a great thing and will spur EMR adoption.

What this poll shows is that the EMR stimulus is out of touch with what physicians and medical practices think is important. The real driver for EMR adoption won’t be a government handout. The real driver for EMR adoption will be hundreds of doctors implementing EMR software which makes their life easier, increases their reimbursement and solves the physician pain points. EMR vendors that provide these benefits to their users are going to be in a great position going forward since that’s what doctors consider meaningful use.

This recent Frost and Sullivan study (requires registration to access) has been making the healthcare IT and EMR blog rounds lately. The parts of the study that are most interesting to consider is their estimated EHR market size.

A study by Frost & Sullivan predicts that revenue for the U.S. ambulatory electronic health record (EHR) market will double from $1.3 billion in 2009 to an estimated $2.6 billion in 2012. Further, by 2013, the market will reach its peak, posting revenue of $3 billion. However, by 2016 market saturation will have occurred and revenue is expected to fall to $1.4 billion.

That’s right. They estimate in 2013 the ambulatory EHR market will be $3 billion. Now compare that number with the $36 billion of EHR stimulus money that’s available (or whichever ARRA EMR stimulus projection you prefer). Are hospitals really going to take that much of the EHR stimulus money? Something just doesn’t feel right about these numbers.

Other salient points from the study I wrote about in my posts about Complex Reimbursement as the Real Driver in EHR Adoption and the reshuffling of providers favoring Large EHR vendors.

She [Nancy Fabozzi, a senior industry analyst at Frost & Sullivan] said many physician practices are facing financial difficulties and the result is physicians are increasingly selling their practices to hospitals, entering into joint ventures with hospitals, or joining larger group practices.

“This whole reshuffling and realignment among ambulatory physicians is going to have a huge impact on the vendor market because many of these 300 vendors that we talk about are a lot of mom and pop EHR companies that have under a million dollars in sales annually,” Fabozzi said.

She added that if physician practices are going to be a part of a big hospital network or a large medical practice group they are going to buy EHR products from larger vendors.

It’s been becoming pretty clear that many small physician offices are selling off to hospitals or larger group practices. This consolidation has been going on for a while and really is going to change the healthcare industry in dramatic ways. I agree with Nancy Fabozzi quoted by Information Week above, that this consolidation favors the EHR Software that comes from larger EHR vendors. Right or wrong, hospital and large group practices generally select the larger EHR vendors.

Pat Rioux on LinkedIn made the following comment about a possible surprise that could come from the move to broad EMR adoption:

I hope the biggest surprise that we get from this huge undertaking is that we finally have providers wondering how they did their job without an EMR in the past. Improvement that is measurable speaks for itself. Patients who finally have access to their medical data and become participants in their own healthcare will be the best reward.

Well said. I’d also add that there are going to be a whole group of doctors in 5 years who never knew how to practice medicine without an EMR. There’s challenges with this too, but it’s an interesting view. Not to mention doctors who’ve been on an EMR for 10-15 years and can barely remember what it was like using a paper chart.

Yes, a few doctors will start using their EMR and miss the great chart hunt they use to embark on to find a missing chart. Or…

Welcome to my Sunday look back on past EMR posts. Tonight, I’ll look at 3 posts that I remember quite well and have actually referenced a number of times. Let’s also take a look at what’s happened since I posted them.

Big Winners from Obama EHR Stimulus HITECH – I loved this post. It was a really really early look at which stakeholders would benefit most from the $18 billion of EMR stimulus money. I still think the list is pretty accurate. If you disagree with the list, I’d love to hear it.

Top EMR Companies Method of Selecting an EMR – This is the type of post that I love to write, but I’m not sure how many people love reading them. However, the comments did highlight one interesting theme. People really are looking for help in selecting an EMR. It really did give me motivation to finally start selling my EMR selection book. I also just recently started a page listing a number of different EMR selection websites. Hopefully both can add some value for users.

Effect of Stimulus Package on EHR Adoption – I think this was a somewhat pivotal post for me. I sadly articulated the lack of value of the EMR stimulus money and how I believed that it wouldn’t have the desired effect on EMR adoption. However, it also helped me to realize and conclude how important it is for doctors to take their time selecting the right EMR and not be distracted by the EMR stimulus dollars. Something that I’ve repeated a lot the past year and a half.

Back in April, Evan Steele, CEO of SRSsoft, wrote an interesting post about EMR adoption and he asked the question, “Why Are You Still on the Fence?” It’s a very good question. Plus, he adds some value to the conversation by listing some of the problems with paper charts versus an EMR. Here’s a section of his post:

So why are these physicians, who have determined that government incentives are not relevant or achievable, still on the fence about adopting an EMR solution that will deliver measurable benefits? Staying with paper charts is not a good business strategy because there is nothing more inefficient!

• The costs associated with the excess staff needed to manage these medical records are massive and wasteful—these positions can be eliminated or the employees can be more effectively used in revenue-generating or patient-care roles.
• Paper charts hinder practice growth because adding physicians requires a proportional increase in support staff—medical records, billing, nurses, and medical assistants—and because physicians can’t see more patients without lengthening their work hours.
• Slow responsiveness to primary care physicians limits referral volume.
• Profitability is further affected by billing bottlenecks that delay revenue collection.
• The chaos associated with trying to manage paper charts has a damaging effect on staff morale and creates rampant frustration among patients, physicians, and staff.
• Paper charts are a malpractice nightmare—prescriptions are not consistently documented, orders are not easily tracked, and medical decisions are often made without complete clinical information.

So, why are doctors on the fence with EMR? The sad thing for me was the pre-EMR stimulus money, I felt a shift in the tone of conversation around EMR adoption. Doctors had mostly moved from wondering if they should implement an EMR to how they should implement an EMR and which EMR they should implement. They were off of the fence and I saw the tide shifting.

And then in one anti-stimulative swoop, the HITECH act rolled out and doctors decided to go back to the sidelines and see this government incentive play out. Now they’re waiting for meaningful use to be defined. While the HITECH act has increased EMR awareness 10 fold, it’s also done much damage on the short term EMR adoption. I’m not sure that the increased awareness will overcome the damage that it’s caused.

Of course, the damage is done and so we have to go forward from here. I suggest we go back to pre-EMR stimulus times and focus more effort back on the benefits of EMR and the costs of paper instead of the government handouts. If we do that, we’ll see a fantastic shift to more widespread EMR adoption.

Tom’s previous guest post about meaningful use and healthcare IT seems to have struck a chord with some of my readers. Here’s an example of one email (posted with permission) from the always passionate Al Borge, MD, I received in response to Tom’s post. The most interesting part of Al’s email is his last comment about the Medicare penalties that ARRA will impose.

>>> As for the burden of meeting Meaningful Use criteria being too stringent for small practices to meet, this is again an excuse to avoid change.

“Change” for change’s sake is not the way to go… the change that you are talking about is BAD change, and that’s not the way to go.

Look- physicians aren’t just a bunch of luddies that are ignoring high tech out of ignorance. When it comes to technology, we’re usually the first to buy tablet PC’s, the first to buy/significantly use the latest and greatest cell phones as well as have several internet accounts for our homes, offices, and for mobile apps. We buy some of the best cars on the market and cherish a whole host of other electronic “toys” that we use daily.

The problem with the EMR is that most of the EHR systems out there today are simply 1) unaffordable, 2) workflow killers, 3) are being coopted by Big Government in schemes like P4P that later are used against us to pay us less.

The vendor inspired dogma that the EHR saves money, decreases errors, and increases quality has yet to be proven in a side-to-side test against paper and against simple, basic EMRs. Until these claims are proven, most docs will sit on the sidelines. Most of us are not that stupid to believe this crap.

What we see is that a lot of lobbying money is being spent in an effort to get our politicians to enact laws to straddle physicians with the high cost and complexity of an “Obama” HITECH ready EHR, most of which have as high as a 50% deinstallation rate (based on numerous sources) and as has been recently reported by the CDC, owns only a 6% market share among practicing clinicians.

>>> Buying an EMR system and using only half the features will undoubtedly lead to the system not generating the ROI it is capable of providing.

As long as paper records or a “basic” EMR returns a good ROI, it’ll be a hard sell for vendors to force doctors into using a budget and workflow busting EHR.

>>> Being forced to meet Meaningful Use is a way of ensuring offices are using their EMR system in a way that will provide them with the benefits it is designed to provide.

This one is scary- under President Obama are we now living in such a Communist state that Big Government has the power to force its citizens, which in this case are physicians to go against their better judgements and to buy EHR systems that they do not care to use? You have to be kidding me…

This is truly a Healthcare train that is out of control. The day that I get hit with a Medicare 5% tax/penalty I’ll simply pass it onto my elderly Medicare patients as a yearly “Obama tax” thaty THEY, not I will have to absorb. No pay, no see.

David Swink wrote an interesting comment on my previous post in which he lists a number of reasons why he thinks the EMR effort is proceeding so slowly. Since many of you don’t read all the comments on this site (I’ll forgive you this time), I thought I’d highlight his comments here to see what people think of his comments and what more they might add to the list.

Thought on why the EMR effort is proceeding so slowly:

1) EMR is much more complex than a simple inventory control system. The “human resources” apps probably come closest to the mark, but there are hundreds of separate HR apps out there, but they don’t have to talk to other HR apps.

2) Government is not good at organizing complex efforts. The government-sponsored HDTV effort took some 30 years to implement, and the results were largely irrelevant in that we’d moved beyond the concept of “broadcast”.

3) The medical community has no “IEEE” standards group to represent their interests and get various vendors to pull together towards a well-defined goal. The AMA could maybe assume this role, except that it is mostly a political organization, with only 17 percent participation by physicians.

4) Large medical groups are not likely to encourage mutual cooperation in EMR development. To them, small physician groups are competition. (Likewise, Sarbanes-Oxley works to the benefit of large corporations who can afford the accounting red tape, to the detriment of Mom-n-Pop organization, where red tape is a meaningful expense.)

I think David missed a number of other important reasons. Like the 300+ EMR and EHR vendors for a start. What else do you think is slowing the EMR effort? And more importantly, what can be done to overcome these challenges?

I was really intrigued by this well done article by Dr. Richard Hom about the Ethical Dilemma of the EMR. In it he describes the difference between the EMR technology world that will “sell anything at any cost” against the medical community values of things like the Hippocratic Oath.

He ends the post with these stinging paragraphs:

But medical angst persists. Because the EMR vendor is pursuing a “top down” sell, they bypass the medical leadership and pitch the C-level administrative staff. The medical input is usually an afterthought and the medical angst continues.

Countering the medical angst and overcoming the perception of “business ethics” being ugly will not be easy. If there be a truth in medicine, it is the gaining and loss of trust. Trust is not a trivial matter that can be bandied about just for a sale. To belie the image of the untrustworthy EMR vendor, both vendors and medical professional must make this their primary goal and objective even before the first sales pitch is given. The reward is either an EMR project that is successful after two years or an unsuccessful project that lasted ten years. The shipwrecks of EMR failed projects are a testament to that result should we forget this difference in world perceptions.

I agree that trust is really the key to a successful long term relationship with a doctor’s office. The sad part is that far too many EMR vendors aren’t interested in the long term relationship. They’re making the quick sale and then looking for the next sale. I really believe that a number of EMR companies are going to quickly scale to a level of sales where they can’t support the growth and then sale off to another competitor.

However, more important might be those EMR vendors who go in for the quick sale and then leave the clinics hanging during the EMR implementation process. You all know stories of what I’m talking about. I suggest that it’s only going to get worse not better.

Add in the EMR stimulus money and the natural increase in initial (at least) EMR adoption that will occur and even many well intentioned EMR companies are going to be caught in the trap of trying to support all these EMR installs. Lack of support from the EMR vendor is going to lead to even more EMR failures.

Naturally, all of these increased EMR implementation failures will taint the EMR industry even more and slow EMR adoption worse than ever.

Not to be all doom and gloom. I’m just highlighting one possibility. What’s the solution?

1. EMR vendors don’t over sale (this will be nearly impossible and takes a special vendor to not do this).
2. Doctors, do more research about the EMR vendor you select. I call it an EMR vendor background check.

EMR is the future, but the question is how long until that future is the present.

One of the first people I talked with when I arrived at HIMSS was a meeting with Dr. Greg Parston from Accenture. Dr. Parston has an interesting job at Accenture since it seems like he gets paid to just study interesting topics. Not a bad gig.

Well, it turns out that Accenture and Dr. Parston had been working on a few studies related to EMR (imagine that). So, we had a really interesting discussion about the findings of their survey and Dr. Parston even made some predictions about the future of the EMR market. The following are some of the takeaways I thought were interesting from our discussion:

First some details about the survey. It was a survey of 1000 doctors done in December of 2009 from all over the country. They showed a 15% percent adoption rate for EMR, or basically in line with most of the other projections of EMR adoption.

The study then took a look at the next 24 months and these doctors plans for that time period. They found that 60% intend to purchase an EMR system in the next 24 months. However, if you look at just those doctors that were under 55, the number intending to purchase an EMR is 80 percent.

A few other interesting things about their motivations and size. They found that the stimulus money was the number 1 factor for wanting to implement an EMR. I guess this isn’t surprising, but it’s unfortunate. Sure seems like a hard thing to reconcile when I think that most doctors want to use technology to become more efficient. Yet, there number one motivation (EMR Stimulus money) does nothing to improve productivity. An EMR might increase your productivity, but “meaningful use” and “certified EHR” don’t help with that.

Dr. Parston also mentioned that doctors want to control their data. Imagine that! Sorry hospitals and SaaS EMR (except for those SaaS EMR that give doctors their data, I’m not talking to you).

The most interesting part of our conversation was that Dr. Parston projected that there would be 70 percent EHR adoption in 3 years. I posted that to twitter right after he said it to a mixed response with more people saying that won’t happen. What do you think about this? That’s a pretty lofty projection if you ask me. I’ll be surprised if we top 50% EHR adoption in 3 years.

Finally, Dr. Parston also mentioned that in one of his EMR studies they found that 70 of Americans said it was very important or important for a doctor to have EMR. This number kind of bothers me, because I just don’t see this same patient demand for doctors to use an EMR. You may remember that I’ve written a few times about EMR adoption waiting for consumer demand for EMR. So, I think this will happen at some point. I just don’t think we’re there yet.