The value of electronic health records in solo or small group practices. Physicians' EHR adoption is slowed by a reimbursement system that rewards the volume of services more than it does their quality

• HIT Description: EHR More info...
  
• Purpose of Study: To determine the financial costs and benefits associated with EHR use in small ambulatory practices
  
• Years of study: 2004-2005
  
• Study Design: Case studies of 14 different small ambulatory care practices that implemented EHRs from two different commercial vendors.
  
• Outcomes: Initial and ongoing EHR costs.
  

• Evaluation Method: Mixed methods were used including semi-structured interviews, observations of providers use of EHR (in 11 practices), review of vendor contracts, and of practice reports
• Barriers: Three of the 14 practices had considerable difficulties in implementation due to problems with their billing systems. One had no billing or revenue for three months; another had no revenue for ten months (and almost went bankrupt) and the third had to redo its billing for the first six weeks after implementation. At a later time this third practice also had a complete system crash that caused a total loss of data and required providers to work without access to computer or paper charts.
• Cost of HIT systems: Initial system costs were found to be $44,000 per FTE provider. Initial software, training and installation costs were $22,038 per FTE provider. Installation and training costs were $14,000 per FTE provider. Hardware costs were $13,000 per FTE provider.
• Cost of Implementation: Revenue losses from decreased productivity (fewer patient visits) during training and installation were $7,473 per FTE provider, ranging from $0 to $20,000.
• Long-term Cost:  Ongoing costs were $8,500 per FTE provider
• Quality of Care and Patient Safety Outcome: Use of EHRs to engage in quality improvement activities was limited. Of the fourteen practices, only five had specific performance targets for QI, and only four had specific protocols/plans for delivering needed care. All but one practice regularly used templates to document encounters, but only seven had templates with substantial coded data that can enable more extensive reminders and reporting.
• Changes in healthcare costs: The average practice paid back its financial investment in the EHR systems in 2.5 years.
• Changes in revenue: The average increase in revenues was $33,000 per FTE provider per year. Approximately half of the increased revenue was attributable to increased reimbursement coding post EHR implementation.
• Time needed to accrue benefit: Providers reported working longer hours for an average of 4 months post EHR implementation.