The True Costs of EMR Implementation

Most physicians don't take into account the unanticipated out-of-pocket expenses and hidden costs that crop up after installation when choosing to implement an electronic medical record.

Do you know what it costs to implement an electronic health or medical record (EHR or EMR) in a multi-physician practice? That is, the true costs — implementation plus unanticipated out-of-pocket expenses?

“Physicians don’t know what to calculate,” says Angela Rose, director, HIM solutions for the American Health Information Management Association (AHIMA). “And I think a lot of them — the smaller practices that have under 10 physicians — get overwhelmed.”

So let’s put an end to the mystery. A recent study of 26 primary care practices in North Texas found that the typical multi-physician practice would spend approximately $162,000 to implement an EHR, plus an additional $85,500 in first-year maintenance costs.

And it’s those hidden costs that crop up after the initial installation has begun that physicians need to be aware of.

Gathering knowledge

Rose explains that the average physician practice, upon deciding to implement an EHR, simply begins contacting vendors. That’s where the problems begin.

“Because of their lack of knowledge of what to expect when going down the road of implementing an EHR, physicians can kind of easily get bulldozed by vendors,” Rose says. “You know, of course, they’re there to sell. They want you to use their system. A physician practice, especially a small physician office, isn’t going to have this knowledge because it’s not their area of expertise.”

But, the information is available. Organizations like AHIMA have instructional materials on how to write a Request For Proposal, as well as webinars and face-to-face meetings with physicians to help disseminate EHR implementation information.

Once the proposals begin coming in, there should be one person — and practices can hire a consultant to handle this — who will manage the influx of paperwork. Begin narrowing the list of vendors down to the top two or three, and then request an on-site demonstration. When you think you’ve found the vendor you want to work with, ask for client references, and do your own site visit.

“Visit another practice of the same size and watch their system for a day,” Rose suggests. “Watch how the system is integrated into the practice, and how the staff works with the system.”

Learning from experience

If the process outlined by Rose sounds excessive or time consuming, consider the story of Thomas Mohr, MD, of San Diego’s Pediatric Partners. Mohr led the organization’s first EMR implementation and, being unfamiliar with the vetting process, didn’t know the right questions to ask or functionalities to explore. He was simply told the solution would meet all of the organization’s needs.

“At that time [we] had about five offices, so we implemented in two in the beginning, and it was a very onerous implementation,” Mohr recalls. “The system was a little bit cumbersome, and it also wasn’t that familiar with pediatrics. Implementation probably took about a year.”

Then the problem arose that the system was not Internet based. The practice had to put more providers and staff onto the system, but the server didn’t have the capacity.

“[The servers] started freezing, and we started losing data,” he explains. “And so I had panicked physicians.”

Mohr made the difficult decision to get rid of the system and go back to paper. Fortunately, about a year later, the billing vendor the practice began working with decided to set up an EHR, and invited Pediatric Partners to serve as a beta tester.

“We actually helped develop some of the pediatric content,” he says. “The differences were amazing to us just from the standpoint of being connected to an Internet-based system.”

Mohr says he learned a great deal the second time around; understood the bigger picture a lot better. Part of that understanding was recognizing the presence of hidden costs, such as software compatibility issues, or security programs to protect each computer.

There was also the realization that, “for some practices, after six months, they’re not getting back what they had before; EMR implementation is costing them something,” Mohr says. “I think you have to be aware of that up front, and then figure out ways to make your office more efficient.”

Mohr says that means putting more responsibility on the shoulders of the practice staff.

“Some of the duties that the EMR wants the provider to do, hand them over to the lower paid staff,” he suggests. “And one of the things we did in the second implementation that I think really helped was that we looked at all our processes and said, ‘Okay, this is an opportunity to change all the things that we’re inefficient at, that we’re not doing a good job of.’ And then I think for us, because we thought ahead and did that, we saw the benefits of EMR early — probably within a couple of months.”