Are You Maximizing EHR Value by Minimizing Costs?

darcygue2016By D’Arcy Gue, Director of Industry Relations, Medsphere Systems Corporation
Twitter: @MedsphereH
Twitter: @DarcyGue

Most of the time, discussions about behavioral health EHR costs focus almost exclusively on the actual outlay for the system, implementation and ongoing maintenance. Maybe hardware is also included when the behavioral health hospital in question doesn’t have the requisite foundation.

But there are economic efficiencies enabled by an EHR that behavioral healthcare facilities would do well to embrace in determining what an EHR solution actually costs. Hard costs are reduced when coupled with reductions in pre-EHR inefficiencies that can effectively be addressed using the healthcare IT system.

When deciding whether or not your behavioral health hospital can afford an EHR, there are a few different areas to consider in fleshing out a complete and accurate ledger of total costs and savings enabled by the healthcare IT system.

Let’s start with the most mundane potential source of savings—the elimination of (optimistic) or dramatic reduction in (realistic) the use of paper.

Before EHRs, medical record keeping was a paper-based, manual project that required paper, ink, printers, filing cabinets or shelves and people to manage all those records. With EHRs, your patient records become readily available to clinicians without an extensive search. Updates to the record don’t require the printing of more documents.

Figuring out how much savings the move to an electronic environment might create is as simple as determining annual expenditures on related supplies before the EHR goes in and comparing that with paper, ink., etc., purchases after the system is fully in use.

Keep in mind that while the elimination of paper records may reduce labor in one area, the adoption of healthcare IT may expand labor in another. Labor costs may stay the same or potentially rise.

Duplicate and Unnecessary Testing
Cleveland Clinic worked with their EHR vendor to build hard stops into the system. Now, when a doctor tries to order a duplicate test, they’re blocked and instead see the most recent results of the test they’d tried to order. Originally starting with just a few, the list of lab tests that should not ordered more than once daily ballooned to more than 1,300.

After nearly two years using the hard-stop approach, Cleveland Clinic had prevented around 18,000 duplicate tests and saved close to $300,000 in lab costs.

By limiting who can order complex molecular genetic tests, the clinic also saved more than $700,000 over two years. Adding a genetics counselor and molecular genetic pathologist in the lab to advise physicians on which tests to order saved another $820,000.

This is how one outpatient organization used their healthcare IT system to manage costs. The same opportunity exists for behavioral health hospitals that have implemented a comprehensive healthcare IT system. What can you learn from the experience of other providers? How creative can you be with your own system?

Medical Errors
“Health care in the United States is not as safe as it should be—and can be,” read the opening lines of the Institute of Medicine’s groundbreaking 1999 report To Err is Human. “At least 44,000 people, and perhaps as many as 98,000 people, die in hospitals each year as a result of medical errors that could have been prevented, according to estimates from two major studies.”

Earlier this year, two Johns Hopkins clinicians estimated that medical error is actually the third leading cause of death in the U.S., after heart disease and cancer, and is the cause of nearly 10 percent of all annual deaths.

In behavioral health, data is harder to come by. A Medscape study that looks at medication errors (prescription, transcription, dispensing, administration) in psychiatric facilities yielded three interesting results: behavioral health providers write a lot of prescriptions, most psychiatric medication errors are high risk and self-reporting leads to vastly underestimated numbers of medication errors.

What do medical errors cost? The IoM report estimated that preventable injuries cost from $17 to $29 billion annually. A separate study of medication errors in a large teaching hospital pegged the annual cost of errors at $5 million and estimated that the total annual cost of errors in all acute care facilities was $20 billion.

To be clear, medical errors and medication errors are not synonymous—the latter is a subset of the former. But every facility has some of both, every incident is very expensive, and properly implemented and configured EHRs reduce medical errors, saving your organization significant amounts of money in the process.

Of course, saving patient lives is more important than saving money, which is why medical errors are such a heated topic in healthcare. But in economics, every mistake, every duplication, every inefficiency has a cost, and those costs accrue to both the individual organization and society at large.

Look at the functions of your behavioral health organization in economic terms and embrace the opportunity to evaluate and create efficiencies through the EHR. By finding more efficient ways to approach daily tasks, you can increase patient and clinician satisfaction, and reduce the costs associated with operations.

This article was originally published on Medsphere and is republished here with permission.