Study: PHRs could save $21B annually in the United States

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New study examines cost-efficiency of PHRs. Image Source: County of Fresno, California  

Personal health records (PHRs) could save $21 billion annually and could result in an annual net value of $19 billon based on a 10-year rollout and a usage rate of 80 percent of the U.S. population, according to a study from Center for Information Technology Leadership (CITL), a nonprofit research center based at Partners HealthCare System in Boston.

In its report, CITL examined the cost-benefit of PHRs and the ways providers and patients can integrate the following four model architectures:

  • Provider-tethered: PHRs represent healthcare delivery organizations that offer PHRs to patients and are internally connected to the database of the provider’s EHRs. Patients can communicate with other providers and payors via manual communication channels but are unable to directly integrate external data.
  • Payor-tethered: PHRs represent healthcare insurance companies that offer PHRs to their members and are connected to their administrative databases. Patients can communicate with providers and other payors via manual communication channels such as secure email but are unable to directly integrate external data.
  • Third-party: PHRs are aggregators of healthcare data for users. They aggregate data through manual data exchanges, which import data from external sources but are unable to feed the data into clinical or administrative systems.
  • Interoperable: PHRs rely on regional aggregation of patients’ healthcare data to users. PHRs are populated with data from all regional data sources via standards-based automated data exchange.

CITL found that the benefits and annual savings far outweigh the costs of implementing the PHR architectures, and it concludes that an interoperable PHR is the investment that will provide the value to the national healthcare system and the maximum value of PHRs.

The report also found that:

  • Providing interoperable PHRs for 80 percent of the U.S. population could cost an estimated $3.7 billion to acquire and $1.9 billion annually to maintain. Based on the eight functions of this model—information sharing of test results, sharing of medication lists, congestive heart failure management, smoking cessation management, appointment scheduling, medication renewals, pre-encounter questionnaires and e-visits—interoperable PHRs would save $21 billion annually.
  • The net annual value of interoperable PHRs could be $19 billion annually.
  • Regardless of the PHR type, direct healthcare savings could accrue to both payors and providers, with payers realizing the majority of the cost savings.
  • PHR-enabled e-visits can help reduce the amount of patient travel to doctors and equate to annual savings.

CITL’s PHR Advisory Board estimated that the average American would save 7.6 hours per year though e-visits, equating to an annual savings of $20 billion in recovered wages (given a U.S. work force of 150 million people with an average wage of $17.63 per hour).

The study—supported by unrestricted research funding from Healthcare Information Management and Systems Society (HIMSS), Google, InterComponent Ware, Kaiser Permanente, Microsoft and Partners HealthCare System—illustrates how PHRs can add value to the healthcare system through reduction of waste and error, decreased administrative costs and decreased clinical costs.