More on Budgeting

Medical records costs greater portion of general services budget

The move to electronic health records could mean more money should be earmarked from general services budgets.

According to a recent Billian’s HealthDATA report, hospitals' medical records-related costs typically account for just under 3 percent of total general-service operating expenses, and almost 7 percent of total general-service salary expenses. The top 10 percent of hospitals investing the most in medical records salaries spend 7 percent or more of total salaries there, with the bottom 10 percent of hospitals investing roughly 1.5 percent or less.

Jessica Clifton, product marketing manager at Billian’s, said in order to find an accurate comparison across facilities, Billian’s calculated medical record department costs as a percent of total costs for both overall and gross salary expenses.

“It looks like smaller, independent facilities are spending a larger portion of overall general service salaries on medical records salaries, which could speak to outsourced or alternate resource use in larger facilities,” said Clifton.

The report further shows medical records department costs represent 1 percent to 5 percent of total general service costs in over 75 percent of hospitals. The top 10 percent of hospitals investing the most in medical records salaries spend roughly 15 percent or more of overall general service gross salaries there, while the bottom 10 percent of hospitals spend approximately 3 percent or less. 

“It’s important to recognize that information can be expensive to store and maintain, and not all of it has the same value,” said Lydia Washington, American Health Information Management Association’s senior director of HIM Practice Excellence, in a recent release. “Making the decisions on the value of information is a big part of information governance.”

Adam Powell, PhD, president of consulting firm Payer+Provider Syndicate, isn’t surprised that medical records keeping is getting more attention and more resources. “Given both the rapid changes occurring in medical record keeping and the importance of the function, it is not surprising that hospitals are devoting a substantial portion of their general-service salaries to the function,” said Powell.

Powell said there are both salary and non-salary expenses related to the operation of medical records systems because there are set-up and maintenance costs for the infrastructure itself and the subsequent configuration and operation of the system requires skilled employees who command higher salaries. Jobs associated with medical records range from computer programmers to medical coders.

“While spending 6.5 percent of general-service salaries on medical records might seem like a lot, the quality of the documentation process has the direct potential to both impact revenue and the rate of medical errors,” said Powell.