Solving HIT Adoption Conundrum? Simple – “Show Me the Money”

There is a bit of a Catch-22 going on with regards to the future of PHR adoption by consumers, which I have discussed before. Simply, without broader adoption of EMR solutions by physicians, PHR adoption will go nowhere. And the number one reason doctors have been reluctant to adopt EMRs is quite simple, most EMR solutions are more trouble (and more expensive) than they are worth. The ROI/value proposition for the physician is just not there.

There are some changes taking place, however, that may start showing physicians the money and encourage EMR adoption.

First is the move to electronic prescriptions (eRx). I’m still not sure what value an eRx is to a small physician practice versus a standard paper script. Maybe some savings in workflow, certainly some time savings in eligibility checking, but nothing substantial, particularly for a small physician practice. Where physicians may benefit is when insurers, such as CMS start demanding eRx, or at least provide some type of incentive that encourages its use. CMS was heading down that road by proposing the elimination of prescription faxes in 2009, but after an uproar, has pulled back from that position. In time, eRx will have a modest impact on HIT adoption. (Note: The recent proposal by the DEA to allow the use of eRx for controlled substances removes one of the major obstacles that many physicians have often complained about regarding eRx.  New England Journal of Medicine just published an article today on eRx and that adoption is accelerating, which was covered by The Star-Ledger in NJ)

Secondly, is the pay for performance (P4P) push. In the recent post on the SafeMed deployment at Beth Israel, clearly there was an incentive for physicians in that network to use the SafeMed solution for radiology selection as BCBS of MA was providing significant P4P end of year payments if goals were met. This is but one unique story out there in the P4P realm and I am sure there are numerous others. Sure, one can say that P4P does not require an EMR, but my bet is that increasingly, EMR systems, due to their ability to accurately record data that can later be readily sorted, sifted and analyzed, will lead to P4P programs built around such EMR reporting capabilities. Depending on the incentives, be they carrots or sticks, P4P initiatives will have a significant impact on HIT adoption.

The third is reimbursement for e-Consultations, typically done via secure email communication. Companies such as RelayHealth and Medem have been leaders in this market providing physicians a platform to communicate with their customers. Some EMR vendors also provide this capability within their patient portal solutions, Epic’s My Chart is a good example. If done right, for the right audience (consumer segment) there is a lot of potential here to drive EMR adoption as e-Consults put money directly in the physician’s pocket.

The only problem with e-Consults is that until quite recently, it was rare that physicians were reimbursed. This is changing rapidly:

1. In early 2008, Aetna and Cigna jumped in stating that they would begin reimbursing physicians for e-Consults.
2. In late June, as part of its formal launch, American Well announced it had signed on BCBS of Hawaii as its first major customer. (Note, American Well is a start-up looking to create a “healthcare marketplace” where one can go online and receive direct medical consultations with certified physicians that are a part of the marketplace). Physicians are paid for providing these e-Consults.
3. In early July, the Center for Medicare and Medicaid Services (CMS) announced its proposed rule changes for 2009. Within these rule changes, CMS is proposing new codes that will reimburse for follow-up inpatient consultations done via telehealth. As CMS is the single largest payer in the industry what they do reverberates across the industry. Thus, it will not be surprising to see most other payers begin reimbursing physicians for e-Consults.

eRX, P4P and e-Consults, combined will accelerate the adoption of EMR as there are clearly opportunities here among these three for a physician to either save money (eRx) or make money (P4P & e-Consults). Not all physicians nationwide may necessarily benefit, but the vast majority will, if they are thoughtful in their EMR selection and implementation strategy.

For an example of a not so wise adoption of HIT, turn to this story that appeared yesterday in the WSJ blog.