December 11, 2015

EHR Costs Hinder Interoperability

Datica Editorial Team
Datica Editorial Team

Coming to the end of our analysis of the five major barriers to interoperability is a look at the costs involved with this initiative. The GAO report took such a comprehensive view into EHR interoperability that one has to wonder where the funds are coming from. Seventeen of the eighteen representatives in the study were actually from non-profit efforts or part of non-profit organizations – so, again, where did the money come from? Well the eighteen initiatives cited a variety of sources, including grants, a cornucopia of fees, charitable donations and funding from private organizations. If you’re wondering why so many origin points, the answer is quite simple – EHRs are expensive. Or, rather, HIT has always been expensive and an EHR is simply a bigger target for cost vs. the 30 legacy systems which handled what the EHR does now.

Have doubts? Take a look at this (incomplete) list of cost area considerations:

  • Data center or hosted costs
  • EHR licenses
  • Hardware
  • Internet bandwidth
  • EHR staff facilities
  • EHR maintenance
  • Support fees
  • Supplies, reimbursement
  • Third party software
  • Interfaces
  • Data migration and system conversions
  • Regulatory compliance
  • Policies and procedures
  • New modules or technologies
  • Specialty requirements
  • EHR customizations
  • And the list goes on…

What has been reported by the Michigan Center for Effective IT Adoption is that EHR adoption has upfront costs and yearly costs ranging from $15, 000 to $70, 000 per provider. Costs will vary depending on whether on-site or web-based EHR deployment is selected with SaaS typically requiring providers to pay fixed subscription pricing models. The PTSO of Washington says that “every dollar spent on development = $1 spent to maintain over a three year period.” And those dollars really add up, especially when you’re trying to take on the feat of national interoperability.

For such a feat to be achieved, one necessary cost is EHR customization. Initiative representatives reported that many EHR systems require many customized interfaces, which are specially designed connections to other health IT systems, in order to facilitate interoperability with other providers and organizations. That sentence has a lot of buzzwords in it, so allow me to simplify: it takes a lot of work to make the data gleaned from interoperability useful. These fees are ones the buyers of the EHR systems (i.e., providers) are responsible for. The overall cost to getting this type of work done is not always transparent.

So what does this mean?

We’re stuck between a rock and a hard place. Value-based care finally provides the incentives for enhanced interoperability, but who is going to pay the up front bill to get started? Vendors? Doctors? Healthcare organizations? Payers? It’s hard to say. We’ll find our more on how this will shake out in 2016.

What do you think the solution is? Tweet or email us!

For further reading:

  1. Integrating with EPIC (or any EHR)
  2. Insufficiencies in Standards for EHR Interoperability
  3. Open APIs Solve Lack of EHR Interoperability
tag Interoperability