Insurer finds EMRs won't pay off for its doctors

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BlueCross BlueShield (BCBS) of Massachusetts has decided not to require physicians to install an EMR to participate in its bonus program.

BCBS said it made the decision based on information from past studies, including an American Medical Association estimate that doctors see only 11 cents of every dollar saved through the use of IT.

Despite the decision, BCBS of Massachusetts said it did find value in IT that physicians would need to use, such as computerized physician order entry (CPOE), which the insurer determined makes financial sense in the hospital setting. BCBS in February said that it would require health systems to install CPOE by 2012 to participate in the bonus program.

The insurer made its announcement about the CPOE requirements based on a study conducted by the Massachusetts Technology Collaborative and the New England Healthcare Institute, which found that CPOE could help prevent 55,000 medication errors in the state and provide an annual cost savings of $170 million statewide, or $2.7 million per hospital, mostly through reducing hospitalizations caused by errors.

The Massachusetts study did not look at physician practices, however, BCBS estimated that it would take five to six years for an EMR in an office-based practice to recoup its costs.

The insurer is not suggesting that EMRs are not worthwhile, said Robert Mandel, MD, vice president of health services for the Massachusetts BCBS. “It just realizes that it would be unrealistic to expect physicians to make an investment few could afford,” he said.

Mandel said that if the state passes pending legislation that would provide $750 million in grants to physicians to adopt EMRs, the insurer might change its mind about requiring physicians to adopt the technology. It currently has pay for performance plans that reward doctors for using EMRs.

However, Dale Magee, MD, president of the Massachusetts Medical Society, an ob-gyn from Shrewsbury, Mass., and an EMR user, said that neither health systems nor insurers should expect to see benefits touted by EMR proponents to happen “right out of the box” in hospitals.