A recent study published in the Medicare & Medicaid Research Review concludes that use of ambulatory EHRs by community providers resulted in both higher and lower Medicaid costs.
In 2004, the year the Office of the National Coordinator for Health IT was created, the Massachusetts eHealth Collaborative launched a pilot program in the Bay State to try to track the effect of EHRs in ambulatory practices, letting researchers follow three of the 30 practices that applied.
Focusing on laboratory and radiology costs as well as general medical costs for Medicaid patients, researchers from the University of Michigan, Partners HealthCare and the Eastern Research Group followed the three practices and compared them to other providers in Massachusetts that mostly had not adopted EHRs.
“We found evidence that EHRs may impact ambulatory medical costs, driven at least in part by changes in visits, but the direction of the effect was not consistent across communities and the net effect was minimal,” University of Michigan professor Julia Adler-Milstein and the study co-authors wrote. “This suggests that EHRs, in and of themselves, can facilitate either increases or decreases in cost, and this likely depends on how they are used and the context in which they are used.”
Looking at the costs pre- and post-implementation, the researchers found a noticeable difference in costs in two of the three EHR practices – with the effects in opposite directions, and only for general medical costs.
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Ambulatory medical costs at one EHR practice increased at a rate roughly 2 percent slower than at the comparison practices, while medical costs at a second EHR practice increased at a rate of 2.5 percent higher than at the comparison practices. The third EHR practice, meanwhile, showed negligible differences.
The researchers found no significant difference between the EHR providers and the comparison practices in radiology or laboratory costs, the two main factors they were looking for. Instead, they found “more compelling evidence that observed changes in ambulatory costs were driven, at least in part, by changes in visit rates.” For the two EHR practices that did show differences for medical costs, that translated into per member per month savings, for the one, of $41.60, and increased costs, for the other, of $43.34.
As for the larger discussion on the ROI of EHRs, with meaningful use stage 2 starting in 2014, the researchers said their findings “mirror the conflicting evidence about the impact of EHRs on healthcare utilization and associated cost,” although theirs is apparently the first to study EHRs and Medicaid populations.
The findings suggest, the researchers said, “that state Medicaid programs may need to structure meaningful use in a way that specifically encourages providers to use EHRs to save money by reducing inappropriate utilization.” State Medicaid programs “with a greater proportion of capitated care” may be more likely to use EHRs in ways that result in savings,” they said, and states may want to try to link community providers using EHRs with payment reforms.