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Survey: EHR costs will hit doctors hardest in lost revenue

A new survey indicates it will cost physician practices roughly $120,000 per doctor to implement electronic health records – and that the speed in which a practice fully implements its EHR and shifts to the new workflow is critical to reducing the overall cost of adoption.

The national survey and six-month study was conducted by CDW Healthcare, a provider of technology solutions for the healthcare marketplace. The "Physician Practice EHR Price Tag" study is based upon a survey of 200 physician practices throughout the United States that have not yet adopted an EHR, secondary research on physician practice workflow and internal data on EHR solutions.

According to the study, including equipment, software, services, training time and potential lost revenue, physician practices are looking at a price tag of $120,000 per physician for an EHR.

The study revealed that physician practices are focused on the costs associated with EHR adoption, citing their primary concerns as hardware/software costs (66 percent), time associated with staff training (52 percent) and workflow readjustment (43 percent). Although physicians' top concern is hardware and software, the CDW Healthcare study found that year one expenses associated with that category of cost will likely make up just 12 percent of total EHR adoption costs.

The study found that lost revenue will be a far larger drain on physician practices than hardware and software costs. Physician practices said they expect patient encounters to fall by an average of 10 percent in the first year, equating to a total average revenue loss of more than $100,000 per physician. Although 10 percent is the survey average, nearly 40 percent of respondents said they expect patient encounters to fall by 25 percent or more in the first year, representing the possibility of greater potential revenue loss.

"Survey responses indicate that physicians are worried about the costs of hardware and software components when they should focus on implementing a complete solution that reduces the time lost to workflow changes," said Bob Rossi, vice president of CDW Healthcare. "While a typical practice will have a greater investment than expected, the payoff will be significant."

Some studies have estimated that using an EHR can increase patient encounters by as much as 30 percent. Using a more conservative measure of 15 percent, the study estimates that practices may be able to gain as much as $151,000 per physician per year in new revenue once adoption is complete.

"The most important factor in reducing the cost of EHR implementation is accelerating through the workflow changes," said Rossi. "The quicker practices can reach full adoption, the quicker they will reach the positive side of the cost curve."

Based on a snapshot of the average physician practice's IT infrastructure, CDW Healthcare identified several opportunities to either speed up adoption or reduce costs:

  • Upgrade vs. Replace. The average age of physician practice workstations is less than three years, with 20 percent less than one year old, the survey found. Practices may achieve better results by upgrading existing workstations with system memory, drive space, backup processes and wireless access points to extend the lifecycle of existing workstation deployments.
  • Protect yourself. Thirty percent of respondents don't use antivirus software and 34 percent don't use network firewalls. To protect IT investments and patient information, physician practices moving to EHRs will need to significantly improve their security and business continuity profiles.
  • Train – then train some more: Twenty-two percent of survey respondents say they'll spend at least 10 hours training staff to use the new EHR system. Because training programs are included in the cost of many EHR software packages, practices should take advantage of every training opportunity as a way of accelerating adoption.

Click here to read the full copy of CDW Healthcare's "Physician Practice EHR Price Tag."

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