Electronic Medical Records May Provide Revenue for Providers and Patients

There are few areas of health care reform that industry analysts and policy experts agree on. Adopting a system for electronic medical records sharing is one of them and it enjoys bipartisan support on Capitol Hill. President Elect Barack Obama even pledged his support for modernizing the nation’s health care information system by making it a part of his economic recovery plan.

“We will make sure that every doctor’s office and hospital in this country is using cutting edge technology and electronic medical records so that we can cut red tape, prevent medical mistakes, and help save billions of dollars each year,” Obama said in his December 8 radio address from Chicago. 

Jeffrey Englander, a for-profit health care facilities analyst at Standard & Poor’s, expects that any funds Obama earmarks to modernize health information systems will go towards pilot programs that will attempt to demonstrate the effectiveness and success of medical record standardization before moving towards broader implementation. The overall effort, however, will be delayed at least a year because hospitals don’t have the money to invest — or access to credit — and the industry faces ongoing operating challenges, Englander said.

"Given the difficult operating environment for hospitals, we believe they are moving forward on any IT investments already underway and scaling back where possible, but not pursuing and/or postponing any new initiatives, including electronic medical records," Englander told insideARM.

But even in a perfect world of free flowing credit, privacy and ownership issues could delay the move to modernize the system’s information system, said Ed Haislmaier, a senior fellow for the Center for Health Policy Studies at the Heritage Foundation. That’s why federal legislators should clarify who owns the information contained in the medical records before health care providers make major investments in electronic medical records sharing.

“If they pursue the conventional strategy of focusing on standardizing software and hardware and getting it to all the providers, I’m skeptical it will lead to much saving in the system or improving quality,” Haislmaier said.  “Once you solve [the ownership issue] the stuff about hardware and software becomes easier.”

Haislmaier said determining who owns or can have access to the information, and at what level, has other benefits for hospitals and patients beyond savings from eliminating duplicate files and treatment mistakes. If hospitals and doctors retain some ownership stake in the physician notes and treatments they prescribe, information sharing could lead to additional revenue streams for health providers, particularly from medical researchers. Consumers also might be compensated for sharing their information.

Haislmaier said if health care providers want to tap that potential market, they should work with consumer advocacy groups to devise a system that’s fair to everyone.
 
“Once do that, you have a world in which you have a market in information and the rights to sell it or lease it,” he said.