January 6, 2014

New model to assess return on electronic health records

The Institute of Medicine recommendations for a comparison tool to enable EHR value realization assessments for health care organizations.

As more and more health care organizations adopt electronic health records, the Institute of Medicine released today a discussion paper and financial model, Return on Information: A Standard Model for Assessing Institutional Return on Electronic Health Record, which can help health care organizations fully evaluate and realize the value of their EHRs.

Created in collaboration with participants in the IOM’s Digital Learning Collaborative and members of the Healthcare Financial Management Association, the paper’s authors propose an evaluation model to calculate the financial implications, benefits and costs of implementing and optimizing EHRs and related technologies. Such a model can be most useful to hospitals and health systems for inter-organizational comparisons, identifying best-in-class implementation approaches, and prioritizing process redesign endeavors.

“At Kaiser Permanente, our clinicians, employees, patients and researchers experience the benefits of having a robust electronic health record,” said Terhilda Garrido, contributing author and vice president, Health IT Transformation and Analytics, Kaiser Permanente. “We want all health care organizations and their patients to benefit from the same kind of care coordination and data access. This IOM model provides the tools to make informed decisions for health care organizations looking to implement or improve their electronic health record. It establishes a baseline of potential EHR benefits, all the while knowing that healthcare organizations like Kaiser Permanente are innovating new quality-of-care improvements with EHRs everyday.”

The paper highlights common logistical and conceptual challenges hindering investment decisions and suggests that a standard model, that allows for consistent comparison across EHR implementations, can enable more useful assessments of the value of EHR systems and the related process re-engineering necessary to fully realize that value.

Without a generally applicable standard for quantifying providers’ value realization from their investments in health information technology, variation in results of applying different models and methods contribute to uncertainty and inertia in providers’ consideration of the transition to interoperable health IT. In order to have rational discussions about value, and compare effectiveness of EHR integration, general standards are needed.

The proposed model is presented as a catalog of categorized benefits, expenses and potential revenue impacts, and the accounts where these may be captured. Features of the model include alignment of benefits with the stated goals of the Office of the National Coordinator for Health IT’s meaningful use standards, assessment of whether benefits are expected to accrue to the provider based on different reimbursement regimes, and designation of whether revenue impacts are expected to be negative or positive. Additionally, both benefits and revenue impacts are prioritized by the ability to quantify financial impact and the relative scale of financial impact.

Kaiser Permanente has published numerous studies about the benefits of Kaiser Permanente HealthConnect®, the EHR it launched in 2004. A study published in the Journal of the American Medical Informatics Association in October 2013 found that using electronic health records to automate reporting of quality measures reduces reporting time required for one measure set alone by about 50 percent. Another study published that month in the Journal of the American Medical Association found that the use of electronic health records in clinical settings was associated with a decrease in emergency room visits and hospitalizations for patients with diabetes.

Securely connecting 9.1 million people, 618 medical offices and 38 hospitals, Kaiser Permanente HealthConnect ® is the largest and most advanced non-governmental electronic health record in the world. KP HealthConnect links patients with their health care teams, their personal health information and the latest medical knowledge. It also connects Kaiser Permanente’s researchers to one of the most extensive collections of longitudinal medical data available, facilitating studies and important medical discoveries that shape the future of health and care delivery for patients and the medical community.

The complete version of the model can be downloaded and examined at www.iom.edu/returnoninformation. It is not a formal product of the Institute of Medicine, nor is it endorsed by the IOM.