Cost Benefit Analysis of Electronic Medical Records
Electronic record-keeping systems are popular in areas such as supply chain management, customer relationship management and resource planning to name a few, but their effectiveness in health care organizations is only recently being measured. Cost-benefit studies have been performed to ascertain whether electronic record-keeping systems can really cut costs for primary care physicians and hospitals over the long term, and results have been largely positive.
Research
According to a study published by the Partners Healthcare System in Boston, average annual savings from utilization of electronic records are $86,400 per year for a single health care provider. The research team compared operational costs under an electronic system to those of a traditional paper-based record-keeping system for a period of five years using data from its own organization as well as published historical data. See References for more information.
Costs
Direct costs for implementing an electronic record-keeping system include recurring software costs for license renewals, hardware costs for the machines that facilitate the use of the records and labor costs for those who install and maintain the system. There is also an opportunity cost associated with lost productivity as employees take time to become familiar with the new system and procedures.
Benefits
There are many more benefits than costs associated with switching to electronic medical records. Labor costs are decreased significantly, as time no longer needs to be spent manually pulling and delivering charts, performing transcription of doctor's notes and manually sorting through accounts receivable documentation.
Electronic records greatly decrease the number of costly mistakes as well. Billing errors are much less frequent, and collections efforts are more efficient. Mistakes in drug prescription leading to bad reactions are virtually eliminated. Laboratory and radiology utilization become more efficient as employees spend less time shifting through papers and more time performing productive activities.
Considerations
Cost savings grow proportionally greater over longer periods of time. This is true of most IT-based cost-saving mechanisms since there is a large capital investment required up front and much lower costs for maintenance and administration in future periods.
Job descriptions within your organization may need to be restructured after you implement an electronic record-keeping system, since many low-level employees will find themselves with much less "busy work" to do. All employees involved in the processing of paper records will have much more free time after adapting to the new system, which may require active job enlargement by human resources managers. Work backlogs and lead time will also be shortened, creating a quicker response time for processing within your organization.
Potential
The health care industry as a whole faces enormous pressure to keep costs down for patients, and implementing an electronic medical record-keeping system is a great way to lower your health care organization's costs and ultimately the patient's price tag. Studies have shown that this practice does indeed pay off over time, and is a productive step toward creating a more efficient and effective health care system.
Tags: health care, record-keeping system, electronic record-keeping, more efficient, Analysis Electronic, Analysis Electronic Medical
