Clarity for the Murkiness that is EHR Pricing and their Contract Structure

Electronic health record prices and contract terms remain ever elusive, and in some case, divisive. Certainly, with more than 50 percent of all practice-based physicians using an electronic health record, there is still little clarity and open communication as to the pricing and contract structure of the very systems that physicians and their practices are mandated to build their practices on.

Having worked for an electronic health record vendor, I understand the need for discreetness to a point, as well as the fact that prices of products and terms of contacts can’t always be posted to the web or nailed to the door like an a la carte menu; however, I do believe that the process should be a bit more transparent than it currently is.

That said, I’ve asked a couple industry leaders some of the questions I’ve had on the subject and their responses are educational, insightful and informative. I hope you feel the same.

What should physicians expect to pay for an EHR?

Rob Pickell, CMO at Kareo

There’s a wide range of pricing options on the market ranging from $0 to thousands. The three most popular pricing models include (i) old-school buy software license and pay monthly support for it, (ii) subscription-based models with a per provider, per month fee plus training and “setup” fees, and (iii) free software with a marketing model to drive another line(s) of business.

Carol Slone, RN and Principal Advisor at Impact Advisors

The cost of a physician practice EMR will vary depending upon the functionality and integration that the system provides. Just as the cost of other goods and services varies in our economy, the type and number of features, the level of face-to-face training and support and the connectivity of the application to hospitals and other providers will impact the final price point.  The current range of EHR systems available today starts at free and goes to $35,000K one time with support costs ranging from $100/month to $1,500 month. Bottom line: Buyer beware; know what their requirements are; shop around; and ask questions.

What is the average length of contract with a vendor for an EHR?

Rob Pickell

Traditional multi-year contracts ask for a minimum 12 months and max of three years.  The more years, the less per year price in most cases. Now options exist with “no contracts” or “no-long-term commitments,” which reduce the liability and remove a lot of risk from using technology.

Carol Slone

Physicians should enter into the contractual use of an EHR as a long-term commitment, as the real value of using an EMR becomes apparent after aggregating the patient data and seeing the patient care over time. Contractual duration can also range from lifetime to a few years. Bottom line: The buyer beware as to how and if the patient and practice data that has been archived will be easily and completely transferred to a new system and at what cost.

What do physicians need during the implementation processes?

Rob Pickell

In today’s market, for the first time, we have a group (growing group) of experienced EHR users. This group often requires less “consulting” on how to implement an EHR, but favor more “how-to” on the software itself. Conversely, there is still a large segment of the population (especially in small medical practices) that are new to the EHR world. These are folks who don’t know what “CPOE” stands for, nor do they have experience using templates.  This group needs more rudimentary education on EHR, what automation means to their practice workflow and the “how-to-use” product education. The last group of EHR implementers is the most complicated group where they are implementing in large, multi-connected medical centers where they implement across departments and have technical integrations with other systems.

Carol Slone

Purchasing software and services from a vendor and working through the implementation process must be considered as a comprehensive effort. Buying pieces a la carte may leave the drive with a car, but no tires or gas in the tank.

What are the biggest misconceptions about EHR pricing?

Rob Pickell

Misconception:  EHR pricing has to be complicated.  Not so. With consumer-influenced pricing, a small group of innovative EHR technology vendors have fundamentally redefined EHR pricing. Unfortunately, when you ask traditional EHR vendors the price of their product, 90 percent of the time an “it depends…” answer is given. Luckily, a small group of vendors have simplified pricing and sign-up so much that online purchasing is possible.

Misconception:  EHR software and training has to cost. Assuming that Internet and computers/tablets expenses are a given, these days we see very reputable, stable, revenue sustaining companies are offering software, training and on-going support for free.

Misconception:  Free is horrible. Those companies legitimately offering “free” software and services will explain why they do it.

Misconception:  Price for one vendor can instantly be compared to the price of another. With the overly complicated pricing and packaging some vendors have, it is nearly impossible to get a true apples-to-apples pricing comparison.

Carol Slone

Physicians must realize that scope drives cost, just as the number of features on just about any product will drive the cost up or down. The requirements of the EHR (what do I need the software to do and in what method) should determine the “scope” that the practice is seeking.  If you want a luxury product, you pay. If you want an economy product, you may initially save money. However, six months to a year when the economy product has meet the basic needs, but now the user desires additional features and functionality, the economy product is likely not to satisfy and likely not able to expand its functionality and features.

Miscellaneous thoughts on the EHR process?

Carol Slone

The physician practice is buying not only software but also services from the vendor. The vendor will have assembled a package of services that will enable the physicians and staff to configure and learn the software for the best use of the tool within their realm of patient care. Attention to workflow, data requirements of the physician and patient care, and learning needs of the staff are important activities to maximize the software’s use.

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