10 Years After the HITECH Act: Assessing the Federal Government’s Subsidization of Electronic Health Record Adoption

By Ken Perez, vice president of healthcare policy, Omnicell, Inc.

Ken Perez

It was such a beautiful, logical vision: The creation of “an electronic circulatory system for health information that nourishes the practice of medicine, research, and public health, making health care professionals better at what they do and the American people healthier,” as David Blumenthal, the National Coordinator for Health Information Technology from 2009 to 2011, wrote in an article on the potential of the HITECH Act’s subsidization of the adoption of EHRs by hospitals and physician practices that appeared in the Dec. 30, 2009, issue of the New England Journal of Medicine.

The HITECH Act was combined with the American Recovery and Reinvestment Act of 2009 (ARRA), an economic stimulus bill created to help the U.S. economy recover from an economic downturn that began in late 2007. The passage of the bill spawned an ambitious vision of an elaborate national health information infrastructure that would enable frictionless, collaborative data sharing primarily through a National Health Information Network (NHIN) that would connect an interlocking web of regional health information organizations (RHIOs) and health information exchanges (HIEs).

It must be emphasized that the NHIN vision was a federal government vision—not one generally shared by the private sector. It was never realized, and the adoption of EHRs by healthcare providers has been described as “a digital revolution gone wrong” and “a bridge to nowhere,” in the 15-page cover article of Fortune magazine’s April issue, entitled “Death by a Thousand Clicks,” by Erika Fry of the magazine and Fred Schulte of Kaiser Health News.

For their report—which has the feel of an exposé — Fry and Schulte interviewed more than 100 physicians, patients, IT experts, administrators, health policy leaders, attorneys, government officials, and representatives from several leading EHR vendors. They employ a combination of poignant vignettes of patients who were harmed by EHR shortcomings — including the experiences of former Vice President Joe Biden’s son Beau and the husband of CMS Administrator Seema Verma — as well as ample facts and figures.

Per Fry and Schulte, the federal government has spent $36 billion to date to subsidize the adoption of EHRs by healthcare providers, and today, 96 percent of non-federal acute care hospitals and 86 percent of physician offices have EHRs.

Despite the significant amount of federal funding and broad adoption of EHRs, they have not fulfilled their potential, as Blumenthal has admitted. The expected “digital dividend” from EHRs has not materialized, or at least its magnitude is much smaller than hoped for. According to Fry and Schulte, EHRs’ general demerits include poor, tedious usability—which adds work and is cited as a major contributing factor to physician burnout — rampant errors that lead to patient safety risks, “upcoding” (bill inflation), lack of interoperability, widespread data blocking, and patients’ inability to access their EHRs. Data silos clearly exist between the 700 federally certified EHRs of widely varying functionality, as well as between provider organizations and other players in the healthcare system. In short, idealism has run into the reality of commercialization.

Fry and Schulte provide no optimistic, Hollywood ending to the article. Industry attempts to promote interoperability are described as fledgling, and their sobering conclusion is that the state of EHRs in the United States is “an unholy mess.”

It’s pretty clear that given its experience to date with EHRs, going forward the federal government will be very reluctant to subsidize a particular category of healthcare information technology. At this point, the federal government is left with promoting standards that support interoperability and mandating specific data sharing and integrations between certain types of databases or programs, though the Trump administration is reluctant to impose more regulatory “burdens” on healthcare providers.

Fry and Schulte’s analysis is definitely not balanced. There are only two mentions of any benefit of EHRs—and those are quickly countered by mentions of shortcomings. Not a single story of a provider organization with good things to say about their EHR is provided.

So where does this leave the enormous, complex, diverse and competitive U.S. healthcare industry?

It goes without saying that the EHR vendors should continue to improve the usability of their systems, and they should genuinely and materially support interoperability.

As for healthcare providers, with the aforementioned NHIN vision relegated to a pipe dream, many of the nation’s larger health systems are taking the bull by the horns, pressing EHR vendors to interoperate, building their own clinically integrated networks, and brokering data-sharing arrangements with other players in the broader healthcare system.

Such private sector initiatives gain traction only if economic incentives are aligned. That is a fundamental principle that is often lost on the federal government. As Fry and Schulte report, “Blumenthal acknowledges that he failed to grasp these perverse business dynamics and foresee what a challenge getting the systems to talk to one another would be.”

2 comments on “10 Years After the HITECH Act: Assessing the Federal Government’s Subsidization of Electronic Health Record Adoption”

Timely and insightful article Ken. And I agree. There should be a focus on how to incentivize the key stakeholders to help optimize a $36 billion investment. Interoperability is critical and data sharing is the lifeblood of an efficient and effective system of PHM and VBC.

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