EMR vs. EHR

Do you know the difference between an “electronic medical record” (EMR) and an “electronic health record” (EHR)? There is a common misconception that these terms are interchangeable, and many people today could not tell you if there is a difference between the two terms, let alone what that difference is.

An EMR is essentially the equivalent of a paper chart for a patient that is filled out by providers within an individual healthcare delivery organization (e.g. hospitals, physician’s offices), and is a legal record owned by that organization. EMR computer software is sold by enterprise vendors to hospitals, clinics, and other care delivery sites.

An EHR is a subset of EMRs that contains patient information from different healthcare delivery organizations. These records are owned by the patient or stakeholder, and the information can be shared through an EHR network. Unlike EMRs, electronic health records are interactive and the patient can access and supplement the information contained in the file. EHRs connect different healthcare organizations and may contain more detailed information about a patient’s demographics, medications, medical history, etc.

So, in order to utilize EHRs and for them to be effective, EMR software must be adopted by healthcare delivery organizations. Based on an HIMSS Analytics report published in 2006, the majority of hospitals have begun to implement EMRs, but at that point were not beyond the earliest stages. Since then both EMR systems and EHRs have grown in utilization and popularity, considering the potential for the easy sharing of patient information between healthcare organizations. A 2011 presentation by HIMSS shows that in 2011 more hospitals are developing their ability to use EHRs.

Both EMRs and EHRs are clearly an area of high potential for the healthcare industry. As the systems are more widely adopted and developed further at various organizations, the added ease of access and quality of health information will ideally help care provider organizations provide better treatment for patients. There are potential worries related to privacy and security with this type of information being transmitted electronically, however that is an entirely different issue that I will leave to be discussed at another time.

 

Author: Jamie Notaro

Edited by: Ken Chiang

 

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Woes of a Disjointed Healthcare System

As we all know, the cost of healthcare in the United States is high and growing.  Expenditures surpassed $2.3 trillion in 2008, more than three times the $714 billion spent in 1990, and over eight times the $253 billion spent in 1980. Stemming this growth has become a major policy priority, as the government, employers, and consumers increasingly struggle to keep up with health care costs. (Source: Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group, National Health Care Expenditures Data, January 2010.)

The healthcare industry, patient advocates and governmental bodies are pursuing many solutions.  These include, but are not limited to:

• Investment in information technology
• Improving quality and efficiency (e.g., encouraging evidence-based medicine, reducing unnecessary variations in care) – Some experts estimate that up to 30% of health care is unnecessary, emphasizing the need to streamline the health care system and eliminate this needless spending.
• Adjusting provider compensation (e.g., sharing cost savings)
• Government regulation (e.g., recent Medicare initiatives to control costs)
• Encouraging prevention
• Increasing consumer involvement in purchasing
• Altering the tax preference for employer-sponsored insurance

One of the strengths of our current healthcare system, as well as one of its weaknesses, is that it is a market-based system.  We have multiple providers competing against each other.  The strength is that competition leads to innovation if not the low cost we might expect.  However, a market-based, competitive system also leads to a system that can make it difficult for providers to work together.  The resulting lack of coordination can have a negative impact on patient care and lost opportunities for reducing costs.

For example, MedSpan has a client that provides patient care in all 50 states.  They considered developing a unique program that could extend the reach of physicians’ care between visits, enhance patient-physician relationships, encourage therapy compliance and afford the opportunity for earlier identification of disease progression.  However, one of the challenges the program faces is that without coverage of the program by all health plans in a geographic region, physicians do not easily know which patients they can refer to the program.

Assume that only a few health plans provided coverage for our client’s program.  A physician would need to 1) determine that a patient would benefit from the program, 2) determine if the patient’s health plan provides coverage for the program and 3) refer the patient to the provider (my client), 4) develop a relationship with the provider and 5) exchange information to monitor progress, thereby ensuring a benefit for the patient and physician.

That’s a lot of work for physicians who, typically, do not have the time available.  This is especially true if only 5 or 10 patients might benefit from the program and only a few might have coverage.  As a result, a potentially beneficial program falls through the cracks due to a disjointed healthcare system.

A system integrated through better information systems would address some of the challenges the above program faces, but not all.  An extreme solution would be a single-payer system.  While facilitating coordination of care, a single payer system would engender a host of other issues.  For example, the innovation that competition generates may diminish.  Therefore, the question to address is how close should we move to a single payer system while maintaining the competitive, free market that is the foundation of the American economy?

That’s an issue we’ll address in a future entry into our blog.

Potential pitfalls of healthcare reform

In concert with our ongoing series regarding healthcare reform, I saw the article below and thought you might be interested.

Top Democrat Cites 10 Healthcare Reform Pitfalls

By Paul Bedard

Posted September 28, 2010 03:41 PM ET

One of President Obama’s architects of the historic healthcare reform, Tom Daschle, is warning that unless the still evolving “Obamacare” is instituted perfectly, Democrats could pay in the next three elections. “A lot of things have to go right for these changes to work,” Daschle writes in a new book out October 12 about the two-year healthcare battle.

In his insider’s account, Getting It Done: How Obama and Congress Finally Broke the Stalemate to Make Way for Health Care Reform, Daschle cites at least 10 huge hurdles in Obamacare that can trip up Democratic political hopes in 2010, 2014 and 2016, especially if the public continues to sour on the reform which the GOP has pledged to sideline if elected into House and Senate majorities. The potential for problems fall in three categories: higher premiums, a reduction in coverage and much higher taxes.

Daschle’s top 10 political pitfalls:

1. Higher premiums. While he says that “there is little risk” that everyone’s health insurance premium will go up, “it is unrealistic to expect that none of us will see any increases.”

2. Preexisting condition gap. 2010 will see that children with preexisting conditions can’t be rejected by health insurance companies, but adults won’t get that benefit for another four years.

3. Shrinking Medicare payments to doctors. 2011 will see payments to Medicare Advantage plans frozen and payments to providers will increase at a slower rate as it becomes official policy to expect healthcare providers to become more efficient. Daschle says that Medicare Advantage users will get fewer “extras” and he warns that the Feds will have to keep an eye out for doctors who stop seeing seniors as a result.

4. Increased senior premiums. In 2011 more high-income seniors will start paying higher premiums. They will also get less of a subsidy for prescription drug coverage.

5. Cuts in Medicare Advantage. In 2012, Obama’s reelection campaign year, Daschle says that “there will be some significant healthcare events this year that are not politically safe.” Such as: Payments to Medicare Advantage plans will now be cut, not just frozen.

6. Mediare-cutting panel. Also in 2012, Obama will have to appoint a board charged with “tightening Medicare spending even more.” Daschle concedes that “in an election year, the appointment of the board is sure to lead to a new round of overheated charges about what the board might to do seniors’ care.”

7. Medicare tax boost. Come 2013, Daschle reports that individuals earning more than $200,000 a year and couples earning $250,000 a year or more will see a boost in Medicare taxes, ironically called the “HI tax,” short for hospital insurance tax. That tax will go from 1.45 percent to 2.35 percent In addition, he notes, there will be a brand new 3.8 percent tax for these folks on unearned income from investments.

8. Change in healthcare deduction. Also in 2013, the healthcare spending deduction will change. Where you can now deduct anything spent over 7.5 percent of your income, the new base will be 10 percent of annual income. Seniors get an extension on the 7.5 percent rate until 2017.

9. Employer tax. 2014 sees many of the major changes in healthcare reform. One biggie with political implications: If employers have more than 50 full-time workers and do not provide coverage, they will be fined $2,000 for each employee. What’s more, if they provide coverage, but it’s so expensive workers seek the outside option provided in Obamacare, the employers will have to pay $2,000 each or $3,000 for those that get a tax credit, whichever penalty is less.

10. Individual penalty. In 2016, with most of the reforms, in place, individuals who don’t have health insurance will be fined $695 a year, or 2.5 percent of annual income, whichever is greater.

[See photos of healthcare reform protests.]

Daschle, whose tax troubles forced him to withdraw his nomination to be Obama’s first secretary of Health and Human Services, urged Republicans and the public to give Obamacare a chance, just like others in the past gave to Social Security, Medicare, and the civil rights movement.

“The new healthcare law deserves the same chance. There is so much potential for good in every aspect of the law, and people will begin to see the good once the biggest reforms take effect. But this will only happen if we give the law enough time to show its full potential,” he writes.

See a slide show of 10 winners in the healthcare reform debate.  http://politics.usnews.com/news/washington-whispers/slideshows/10-winners-in-the-healthcare-debate/2

Healthcare reform and the quality of care

One of the most significant aspects of healthcare reform is its emphasis on improving the quality of care.  Many aspects of the law seek to improve the quality of care as a way of reducing cost.  The healthier we all are, the less we’ll spend on doctors and tests.  Now, if only the law could help every American lose 10 pounds!!  That would be the best ways to reduce the cost of care.

We cannot really discuss the quality of care until we know how to measure it.  There needs to be a consensus as to what constitutes good care.  The simpler these measures are to understand, the more providers and patients can focus on them and achieve success.

We also need a system for measuring the quality of care.  Quality measures also need to be simple so that they can be implemented and data collected cost effectively.  Of course, to do that, we need widespread use of electronic health records.

The U.S. government announced in February of 2009, the American Recovery and Reinvestment Act (ARRA). The ARRA act included $19 billion under the portion of its HITECH Act to promote the adoption of Electronic Health Record (EHR) technology in healthcare. Starting in 2011, medical providers can receive up to $44,000 or more by demonstrating what has termed as “meaningful use” of certified EHR technology to be eligible for government funds. 

Back to healthcare reform — the Patient Protection and Affordable Care Act (PPACA).  To drive improved quality of care, PPACA requires the identification and publication of a core set of quality measures for Medicare and Medicaid adults.   PPACA also requires Medicaid to establish a quality measurement program. 

PPACA requires the integration of reporting on quality measures with reporting for the meaningful use of electronic health records.  By focusing on the effective use of EHRs with certain capabilities, the HITECH Act makes clear that the adoption of records is not a goal in itself:   it is the use of EHRs to achieve health and efficiency goals that matters.  HITECH’s incentives and assistance programs seek to improve the health of Americans and the performance of their health care system through “meaningful use” of EHRs to achieve five health care goals:

• To improve the quality, safety, and efficiency of care while reducing disparities;
• To engage patients and families in their care;
• To promote public and population health;
• To improve care coordination; and
• To promote the privacy and security of EHRs.

In the context of the EHR incentive programs, “demonstrating meaningful use” is the key to receiving the incentive payments. It means meeting a series of objectives that make use of EHRs’ potential and related to the improvement of quality, efficiency and patient safety in the healthcare system through the use of certified EHR technology.

Stage 1, which begins in 2011, the criteria for meaningful use focus on electronically capturing health information in a coded format, using that information to track key clinical conditions, communicating that information for care coordination purposes, and initiating the reporting of clinical quality measures and public health information.

The final rule reflects significant changes to the proposed rule while retaining the intent and structure of the incentive programs.  Key provisions in the final rule include:  

• For Stage 1, CMS’s proposed rule called on physicians and other eligible professionals to meet 25 objectives (23 for hospitals) in reporting their meaningful use of EHRs. The final rule divides the objectives into a “core” group of required objectives and a “menu set” of procedures from which providers can choose.  This “two track” approach ensures that the most basic elements of meaningful EHR use will be met by all providers qualifying for incentive payments, while at the same time allowing latitude in other areas to reflect providers’ varying needs and their individual paths to full EHR use.
•  In line with recommendations of the Health Information Technology Policy Committee, the final rule includes the objective of providing patient-specific educational resources for both EPs and eligible hospitals and the objective of recording advance directives for eligible hospitals.

Healthcare reform will fund the implementation of medication management services by pharmacists.  Medication therapy management (MTM) is a partnership of the pharmacist, the patient or their caregiver and other health professionals that promotes the safe and effective use of medications and helps patients achieve the targeted outcomes from medication therapy.  MTM includes the analytical, consultative, educational and monitoring services provided by pharmacists to help consumers get the best results from medications through enhancing consumer understanding of medication therapy, increasing consumer adherence to medications, controlling costs, and preventing drug complications, conflicts, and interactions.

Healthcare reform requires the public reporting of physician performance on quality and patient-experience measures through a website that will be called Physician Compare.  What begins with the implementation of EHR and the development of quality measures that are evaluated through data supplied by the EHR ends in public reporting of the results.  This will enable patients and hospitals to work with the physicians that provide the highest quality of care.  While high-quality of care might cost more up front, the (hoped for) decrease in hospital readmissions, adverse events and co-morbidities will (hopefully) reduce costs in the long term.

Implications for Healthcare Manufacturers

The emphasis on quality measures will more and better opportunities for healthcare manufacturers to demonstrate how their products and applications drive improvements in the quality of care.  Such demonstrates need to be based on clinical data that demonstrate how the product or application performs compared to the quality measures that Medicaid and Medicare adopt.  Medical groups and hospitals will look to healthcare manufacturers and government agencies to provide data that cut across multiple settings of care.  However, the growing availability of sophisticated EHR systems could enable medical groups and hospitals to develop data that are specific to their own patient demographics and mix.  It is in the best interest of healthcare manufacturers and government agencies to help coordinate these efforts.  Healthcare manufacturers will be encouraged to develop data for patient niches so that they are ready to address data that medical groups and hospitals gather that might demonstrate different results than those generated by the healthcare manufacturers.

The government and healthcare community (ie, providers and payers) will develop the quality measures.  The medical groups, hospitals and other payers will implement the EHR systems required to collect data relevant to those measures.  There is an opportunity for healthcare manufacturers to play a role in connecting the two endpoints.  That is, healthcare manufacturers can develop algorithms for analyzing the data so that the results comply in an appropriate way with the outcomes measures that Medicare and Medicaid establish.

Today, retail pharmacies are a secondary or tertiary contact for those drug companies and medical device suppliers that distribute product through this channel.  The growing importance of MTM programs will increase the importance of retail pharmacies for select disease states (eg, hypertension, dyslipidemia, diabetes).   Healthcare manufacturers will need to develop programs at the corporate levels of the retail pharmacy companies as well as the neighborhood pharmacies to educate the pharmacists and encourage and support the appropriate implementation of the MTM programs.  More effective MTM programs will encourage therapy compliance and higher quality care.

As the above evaluation demonstrates, the ARRA and PPACA will provide numerous new avenues for healthcare manufacturers to work with physicians, hospitals and other providers to drive an improved level of care.  The time is now to plan for these initiatives and start their development.

To Profit or Not to Profit — That is the question

As Vince Galloro wrote in Modern Healthcare today (“Reform reshaping market for acquisitions by investor-owned companies, Moody’s says,” August 3, 2010)  proposed deals in Boston, Detroit and Ohio show that investor-owned hospital companies are interested in markets that don’t fit their traditional targets.  Healthcare reform is a prime reason.

As healthcare reform goes into effect, markets with higher uninsured populations could become more attractive to investor-owned hospital companies. Reform also could drive consolidation by placing greater pressure on capital needs, such as investments in information technology.

In a capitalist society, for-profit institutions offer many attractive features.  One might postulate that, compared to not-for-profit hospitals, for-profit hospitals offer business discipline encouraged by the demands of investors (ie, stock and bond holders) and financially-driven executives.  In an age where quality report cards are starting to become available and growing in sophistication, due to advances in information systems and agreement on quality measures, revenue generation is becoming as important as cost control for for-profit hospitals. 

However, compared to not-f0r-profit providers, for-profit hospitals pay taxes, issue taxable rather than tax-exempt debt and lose the benefit of charitable donations.  This raises the cost of funding for-profit hospitals.  One result is that for-profit hospitals are less willing to provide charitable care and community-based services that do not measurably link to an increase in profitable patient referrals.

In the age of healthcare reform, is there a need for both types of hospitals (ie, for-profit and not-for-profit)?  If so, in what proportion?  Which type of hospital can best react to the implications of healthcare reform, such as: 1) increased number of patients with insurance; 2) less need for charitable care; 3) decreasing reimbursement from Medicare and other payers; 4) increased opportunity for differentiation based upon measurable quality indicators; 5) increased need for capital to implement EHR and RIO?   Which type of hospital can better integrate with physicians and other providers to develop a coordinated continuum of care that drives quality and profitability under episodic payments?

 Right now, the answers to many of these questions are not clear.  Many answers are specific to each hospital, depending on the quality of the management team and individual competitive situations.  However, in general, at the moment, for-profits are likely to have greater access to capital given the healthier state of Wall Street compared to municipal governments and the impact of the Great Recession on charitable giving.  This will enable for-profit hospitals to develop programs to handle the greater volume of patients and develop strategies to enhance and measure quality and implement the information systems to support those tactics.

There will always be a need for charitable care.  There will always be a segment of the population that prefers religious-based care providers.  There will always be a need for providers in markets that are not optimal for for-profit hospitals. 

My expectation is that there will always be a need for both for-profit and not-for-profit hospitals.  Their missions and the market segments they serve will continue to differ.  The market will not evolve to predominantly favor one type of hospital.