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EHRs: The Feds' big push


The government is considering ways to make electronic health records worth your while, says internist David Brailer, the new information technology czar.

As part of the Bush administration's drive to promote healthcare information technology, HHS recently appointed internist David J. Brailer as the first National Health Information Technology Coordinator. Brailer, who holds a doctoral degree in economics, served as a senior fellow at the Health Technology Center in San Francisco and as Chairman and CEO of CareScience, a healthcare technology solutions and consulting firm that focused on the reduction of medical errors and clinical quality improvement. In that capacity, he helped develop one of the first community-wide clinical data exchanges in Santa Barbara, CA.

Brailer recently spoke with Medical Economics about what the government plans to do to support the spread of electronic health records—a term often used synonymously with "electronic medical records"—and what it all means to physicians.

When President Bush called for a majority of Americans to have electronic health records within 10 years, what did he mean?

Brailer: He meant that, by then, physicians should be using electronic health record programs that can store patient data securely and exchange it with other systems. Clinical information should be able to move with the patient as he travels from site to site, and it should be available if a patient changes clinicians or hospitals or moves to a different area. EHRs should also include features that help doctors improve their clinical decision-making.

CMS Administrator Mark McClellan recently said that CMS will conduct demonstration projects to determine what kinds of financial incentives will encourage physicians to adopt EHRs. Does this mean that doctors who acquire information technology might be paid more?

Brailer: The executive order creating my office calls for the government to look at how it can help finance EHR adoption. A variety of mechanisms have been explored, including giving grants or loans, guaranteeing loans, linking the IT adoption to some components of pay-for-performance, or a combination of those approaches. The President wants us to conduct the economic analyses and pull together the consensus needed to make some decisions.

Some physicians are on the verge of using EHRs, and a very small push will take them over the edge. Incentives could be important to some of them. But different incentives probably affect different physicians in different stages of EHR adoption. So when I think of grants and loans, I think of a different kind of a physician than one to whom reimbursement or other types of financial aid would be more beneficial.

As you know, cost is not the only obstacle to EHR adoption. How do you envision the government supporting doctors in making the change to a completely different way of working?

Brailer: Doctors need help in adopting these technologies. They need help in picking the right systems, implementing them, and deriving value from them. There's a lot more the private sector can do to identify systems that may be a better bet for physicians—particularly those in small practices. But the federal government can also play a role.

Currently, there's an asymmetry between sellers and buyers of EHRs. Large technology companies are selling products to very small physician practices, and these practices don't all have the capacity to absorb the technology into their daily workflow in a way that enhances their work and doesn't detract from it. So a lot of the implementation challenge has to do with leveling the playing field between vendors and practices. I don't think anyone wants the government sending people out to physician offices to implement EHRs. But we can make sure there are institutions in the market to do that.

Up to now, it hasn't been cost effective for most EHR vendors to focus on small offices. How can that be changed? Also, how do you get the vendors to create programs that can talk to each other?

Brailer: I'd like to see more group purchasing, which can lower vendors' marketing costs. I'm also hoping we can decrease the cost of EHRs through the use of application service providers, which deliver the software over the Internet.

I don't believe at this point that we have to incentivize vendors to make their programs compatible. When physicians and hospitals see the value in having systems that work together, they'll incentivize vendors by purchasing only interoperable products. Secretary Thompson has said that whatever financing would come from the federal government for EHRs would be linked to products that are interoperable. How that works has not been specified; it's one of the things we're looking at. But it's possible that new methods of financing EHRs could expand the electronic health record services market. A piece of that could be reinvested in making systems compatible, and everyone would be a winner.

Some health plans have begun giving doctors access to information technology, including PDAs and electronic prescribing software. Others have started paying for patient-doctor e-mail. What more can the plans do?

Brailer: The health plans' role in finance is important. Economic analyses and simple intuition suggest that entities that hold financial risk would benefit from investments in things that improve efficiency and decrease rework caused by errors. So it's in the plans' self-interest to do that.

Unfortunately, health plans are highly fragmented, like the rest of the industry. They each have 5 to 10 percent of a market, and there's turnover among their members. So I think health plans should look at pooling their IT investments so they all move together in a market. They'd get a bigger return by doing that than if they all invested individually.

The plans are also in a position to support physician implementation of EHRs. They have deep technical know-how, they understand physician practices, and many of them have field services teams that support physicians. It would not be unprecedented for them to think about how they could support the implementation of the electronic workflow process. Also, plans could probably get a much better price on products than physicians can—even if the doctors buy as a group—and I think they can help with the purchasing process.

Some hospitals would like to help doctors purchase EHRs, but the antikickback laws prohibit that. CMS has proposed a safe-harbor rule that would create an exemption for hospitals that want to provide EHRs to physicians. Are you aware of any discussions about this?

Brailer: The Secretary and others have mentioned this as an important topic. But whatever's done has to balance the need to create the investments that lead to higher quality and efficiency against the intent of these important rules. In other words, we don't want to create new opportunities to violate the rules.

Many doctors are reluctant to acquire EHRs because they know that systems can't exchange data and that there are changes coming down the road. Would you recommend that doctors buy EHRs right now in the absence of national standards?

Brailer: We do have national standards. The Consolidated Health Informatics Initiative at the Department of Health and Human Services has approved 15 standards related to medical terminology and data exchange. Secondly, we're very close to the promulgation of standards for e-prescribing that are required by the Medicare Modernization Act.

I'd advise physicians to take a serious look at whether specific EHR products meet these standards. [Editor's note: See] If they do, it's a safe bet that the product is a good one to buy. If a product does not meet those standards, the doctors need to do more due diligence to make sure the product is not going to become obsolete.

In many markets, there's a deep reluctance among hospitals and labs to work with their competitors. Based on your experience in Santa Barbara, what are the keys to achieving connectivity among providers?

Brailer: Santa Barbara is a living testament to perseverance and leadership. It also is an indication of why it's important for healthcare communities to come together, and why the people in a particular region can do things that a whole state or a nation can't do. Those people live next to each other, they eat in the same restaurants, their children go to the same schools. It's very difficult at a local level for some hospital or its leaders to just opt out of something that's important to the community. I think in the end that matters more than anything else.

This is not about information technology; it's about reforming healthcare from the inside out. And I think that's what will ultimately bring people to the table.


Ken Terry. EHRs: The Feds' big push. Medical Economics Aug. 20, 2004;81:26.

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