Study Illustrates EHRs’ Potential to Slow Cost Growth

The move to electronic health records (EHRs) is on. And, the rush, in part, is based on the commonly held assumption that EHRs will help health care organizations save money. 

A new study from the University of Michigan shows that the assumption is a good one – to an extent. The report, which appears online in the July 16 edition of JAMA Internal Medicine, concludes that “using commercial available EHRs in community practices seems to modestly slow ambulatory cost growth.”

Researchers found that the use of EHRs can reduce the costs of outpatient care by roughly three percent, compared to relying on traditional paper records. On average, the researchers estimated $5.14 in savings per patient per month in communities that utilized EHRs relative to those without the electronic systems. Much of the savings emanated from radiology, indicating that doctors may have ordered fewer imaging studies because they had better access to patients' medical histories.

"To me, this is good news," said Julia Adler-Milstein, an assistant professor in the University of Michigan School of Information and School of Public Health who led the study. "We found three percent savings and while that might not sound huge, if it could be sustained or even increased, it would be a substantial amount. That said, when we talk about cost savings, it does not mean that the costs went down, but that the costs did not go up as quickly in the intervention communities. This suggests that adopting electronic records helped slow the rise in healthcare costs."

Although the cost reductions appear modest, the report indicates that EHR utilization could result in additional savings if users are properly motivated.

“Larger savings are possible if providers have incentives to deliver more efficient care. Efforts to reform financing and delivery of care alongside greater use of EHRs may focus clinicians' attention on how best to leverage their EHR to achieve savings and help realize the full benefit from our large national investment in EHRs,” according to the report.

The study compares the healthcare costs of 179,000 patients in three Massachusetts communities that widely adopted EHRs and six control communities that did not. The research was funded by the Massachusetts eHealth Collaborative, a not-for-profit organization formed in 2004 to promote the use of health information technology and exchange whose member physician practices participated in the study.