Impact of Electronic Health Records on the Financial Performance of Medical Group Practices—Track 1: EHR Implementation and Adoption
Slide Presentation from the AHRQ 2008 Annual Conference
On September 9, 2008, David N. Gans, MSHA, FACMPE, made this presentation at the 2008 Annual Conference. Select to access the PowerPoint® presentation (700 KB).
Slide 1
Impact of Electronic Health Records (EHR) on the Financial Performance of Medical Group Practices—Track 1: EHR Implementation and Adoption
David N. Gans, MSHA, FACMPE
Vice President Practice Management Resources Medical Group Management Association
September 9, 2008
AHRQ Annual Conference 2008
Bethesda, MD
Slide 2
Impact of EHR on Medical Practice
"One accurate measurement is worth a thousand expert opinions."
—Rear Admiral Grace Hopper
Slide 3
Learning Objectives
Understand how Electronic Health Records affect the economic performance of medical group practices:
- In the perception of medical practice administrators who describe how electronic health records impacted their practices.
- By cross sectional comparison of medical groups with and without electronic health records.
- By longitudinal assessment of practices that implemented an electronic health record in the past two years.
Slide 4
Perception of medical practice administrators who describe how electronic health records impacted their practices
Slide 5
Medical Group Management Association (MGMA) 2007 Electronic Health Record Survey
- Survey frame of medical practices that responded to a 2005 national information technology survey.
- Voluntary response by medical practice administrators.
- 570 practices responded describing their health record system, including 285 practices that had an electronic health record.
Slide 6
Summary of Study Findings
- The study identified 285 practices where EHR implementation is in process or is fully implemented.
- Respondents described increased operating costs, reduced productivity, and other surprises and challenges during the first 6 to 24 months of the implementation.
- After the first 6 to 24 months, the benefits of EHR adoption exceeded costs and most practices wondered how they ever conducted business without an EHR.
Slide 7
Types of EHR
The pie chart answers the question, "What is the name of your current EHR software product?"
- Allscripts Healthmatics: 7.27%
- Allscripts TouchWorks: 5.09%
- eClinicalWorks: 3.27%
- EpicCare: 3.64%
- GE Centricity: 11.64%
- Greenway: 2.91%
- Misys Electronic Medical Record (EMR): 11.27%
- NextGen: 10.18%
- Practice Partner: 2.55%
- Sage Intergy: 3.64%
- Other: 38.55%
Slide 8
Perceived Impact of EHR on Practice Costs
The pie chart answers the question, "Allowing Six Months after Implementation for Physicians and Staff to Become Familiar with the EHR, What Then Happened to Practice Costs (Overall, Including all Staff Expenses, EHR Costs, Transciption Costs, etc.)?"
- Increased: 12.8%
- Stayed the same: 29.6%
- Decreased: 40.4%
- Do not know: 17.2%
Slide 9
Perceived Impact of EHR on Practice Productivity
The pie chart answers the question, "Allowing Six Months after Implementation for Physicians and Staff to Become Familiar with the EHR, What Then Happened to Physician Productivity?"
- Increased: 28.3%
- Stayed the same: 47.0%
- Decreased: 8.5%
- Do not know: 16.2%
Slide 10
Testimonials on EHR Return on Investment
- We are definitely receiving a return on investment (ROI) on our EHR but during the first year it cost us much more than it saved us. Physician productivity is actually higher but they used it to get out of the office earlier (quality of life) versus actually seeing more patients.
- Expensive to start, but ROI should be under three years. It is the only way left to significantly impact practice expenses.
- A robust EHR, carefully selected and painstakingly implemented can be a huge benefit. It's ROI includes reduction in staff, increased billing, faster A/R, better documentation and patient safety and pay-for-performance initiatives.
Slide 11
Cross sectional comparison of medical groups with and without electronic health records
Slide 12
MGMA Cost Survey Report
- Survey frame of MGMA Medical Practices.
- Conducted annually with similar questionnaire format and definitions since 1979.
- Voluntary response by medical practice administrators.
- 2008 report based on data submitted by 1695 medical practices, representing the financial performance of 29,215 full-time-equivalent (FTE) physicians.
- 2008 report included information from 544 practices with an electronic health record.
Slide 13
Cross Sectional Analysis
- Identify medical groups with an EHR and practices with a paper medical record.
- Categorize practices by specialty and ownership.
- Determine the mean for key revenue and expense measures.
- Use the T-test to measure significance.
Slide 14
Impact of EHR on Multispecialty Groups
| Mean Measure per FTE Physician | Paper Medical records/charts | Electronic health record system | Sig. (2-tailed) |
|---|---|---|---|
| Mean total medical revenue per FTE physician | $675,608 | $752,142 | 0.03 |
| Mean total support staff cost per FTE physician | $205,040 | $228,808 | 0.04 |
| Mean information technology equipment cost per FTE physician | $9,963 | $15,024 | 0.00 |
| Mean professional liability insurance cost per FTE physician | $15,254 | $15,598 | 0.79 |
| Mean total operating cost per FTE physician | $430,459 | $469,521 | 0.12 |
| Mean total medical revenue after operating cost per FTE physician | $260,153 | $302,465 | 0.01 |
| N = | 118 | 134 |
Slide 15
Impact of EHR on Physician-Owned Multispecialty Groups with Primary Care Only
The table presents the costs for "Paper Medical records/charts," "Electronic health record system," and "Sig. (2-tailed)" for "Physician Owned, Multispecialty Groups with Primary Care Only."
| Mean Measure per FTE Physician | Paper Medical records/charts | Electronic health record system | Sig. (2-tailed) |
|---|---|---|---|
| Mean total medical revenue per FTE physician | $573,322 | $699,969 | 0.04 |
| Mean total support staff cost per FTE physician | $179,810 | $213,066 | 0.16 |
| Mean information technology equipment cost per FTE physician | $7,250 | $14,557 | 0.01 |
| Mean professional liability insurance cost per FTE physician | $10,649 | $13,007 | 0.21 |
| Mean total operating cost per FTE physician | $333,774 | $433,965 | 0.02 |
| Mean total medical revenue after operating cost per FTE physician | $239,548 | $282,210 | 0.21 |
| N = | 13 | 16 |
Slide 16
Impact of EHR on Family Practice
The table presents the costs for "Paper Medical records/charts," "Electronic health record system," and "Sig. (2-tailed)" for "Physician Owned, Family Medicine Single Specialty Groups."
| Mean Measure per FTE Physician | Paper Medical records/charts | Electronic health record system | Sig. (2-tailed) |
|---|---|---|---|
| Mean total medical revenue per FTE physician | $507,136 | $677,131 | 0.01 |
| Mean total support staff cost per FTE physician | $175,441 | $209,127 | 0.19 |
| Mean information technology equipment cost per FTE physician | $8,264 | $18,344 | 0.00 |
| Mean professional liability insurance cost per FTE physician | $11,954 | $14,335 | 0.33 |
| Mean total operating cost per FTE physician | $356,958 | $402,997 | 0.30 |
| Mean total medical revenue after operating cost per FTE physician | $233,106 | $281,183 | 0.13 |
| N = | 21 | 20 |
Slide 17
Impact of EHR on Cardiology Groups
The table presents the costs for "Paper Medical records/charts," "Electronic health record system," and "Sig. (2-tailed)" for "Physician Owned, Cardiology Single Specialty Groups."
| Mean Measure per FTE Physician | Paper Medical records/charts | Electronic health record system | Sig. (2-tailed) |
|---|---|---|---|
| Mean total medical revenue per FTE physician | $1,211,963 | $1,159,985 | 0.60 |
| Mean total support staff cost per FTE physician | $302,433 | $308,307 | 0.82 |
| Mean information technology equipment cost per FTE physician | $14,423 | $16,974 | 0.23 |
| Mean professional liability insurance cost per FTE physician | $19,930 | $22,752 | 0.32 |
| Mean total operating cost per FTE physician | $619,528 | $577,232 | 0.40 |
| Mean total medical revenue after operating cost per FTE physician | $607,515 | $582,752 | 0.67 |
| N = | 25 | 28 |
Slide 18
Impact of EHR on Orthopedic Surgery Groups
The table presents the costs for "Paper Medical records/charts," "Electronic health record system," and "Sig. (2-tailed)" for "Physician Owned, Orthopedic Surgery Single Specialty Groups."
| Mean Measure per FTE Physician | Paper Medical records/charts | Electronic health record system | Sig. (2-tailed) |
|---|---|---|---|
| Mean total medical revenue per FTE physician | $1,129,408 | $1,319,228 | 0.02 |
| Mean total support staff cost per FTE physician | $245,032 | $337,183 | 0.00 |
| Mean information technology equipment cost per FTE physician | $16,652 | $21,951 | 0.05 |
| Mean professional liability insurance cost per FTE physician | $37,441 | $32,997 | 0.31 |
| Mean total operating cost per FTE physician | $522,072 | $634,352 | 0.02 |
| Mean total medical revenue after operating cost per FTE physician | $608,699 | $684,877 | 0.17 |
| N = | 40 | 22 |
Slide 19
Longitudinal assessment of practices that implemented an electronic health record in the past two years
Slide 20
Longitudinal Analysis
- Identify family medicine and multispecialty with primary care groups that indicated the practice installed an EHR in 2006 and reported information for the 2007 Cost Survey.
- Identify if practice also participated in the 2005 Cost Survey.
- Determine the change in revenue and expense for each practice.
- To control for environmental change, perform the same calculation for family medicine and multispecialty with primary care groups that indicated the practice had a paper medical record..
Slide 21
Mean Two Year Change in Financial Performance for Primary Care Practice
| Mean Measure per FTE Physician | Paper Medical records/charts | Electronic health record system |
|---|---|---|
| Total medical revenue per FTE physician | $38,852 | $ 53,010 |
| Total support staff cost per FTE physician | $15,060 | $ 6,779 |
| Information technology equipment cost per FTE physician | $ (338) | $ 1,816 |
| Professional liability insurance cost per FTE physician | $ (753) | $ (1,523) |
| Total operating cost per FTE physician | $ 29,543 | $ 34,521 |
| Total medical revenue after operating cost per FTE physician | $ 6,603 | $18,410 |
| N = | 24 | 9 |
Slide 22
Observations
Slide 23
Observations
Allowing for sufficient time for installation and change in processes, practices with an EHR appear to have:
- Greater revenue.
- Increased expenses.
- More profit.
Than practices with paper medical record.
The difference may be significant, but more study is needed.
Slide 24
Questions?
David N. Gans, MSHA, FACMPE
Vice President, Practice Management Resources
Medical Group Management Association
dng@mgma.com
Slide 25
About MGMA
Our mission...
To continually improve the performance of medical group practice professionals and the organizations they represent.
MGMA has:
- 22,000 members....
- Who manage and lead 12,500 organizations.
- With 270,000 physicians.
Slide 26
Biographical Summary: David Gans
David N. Gans, FACMPE
Vice President, Practice Management Resources
Medical Group Management Association
Mr. Gans administers research and development at the Medical Group Management Association (MGMA) and its research affiliate, the MGMA Center for Research. In addition to his management responsibilities, Mr. Gans serves as the association's staff resource on medical group practice management. He is an educational speaker, author of a monthly column in MGMA Connexion, and provides technical assistance to the association's members in all areas of practice management.
Mr. Gans received his Bachelor of Arts degree in Government from the University of Notre Dame, a Masters of Science degree in Education from the University of Southern California, and a Master of Science in Health Administration degree from the University of Colorado. Mr. Gans is retired from the United States Army Medical Service Corps in the grade of Colonel, U.S. Army Reserve. He is a Certified Medical Practice Executive and a Fellow in the American College of Medical Practice Executives.
Address: Medical Group Management Association, 104 Inverness Terrace East, Englewood, CO 80112
Phone: (303) 799-1111, ext. 1270
E-mail: dng@mgma.com
5600 Fishers Lane Rockville, MD 20857