US hospitals are facing unprecedented business pressures. According to a recent study published by the American Hospital Association, approximately one-third of all hospitals are currently operating at a loss. Even better-performing hospitals are having difficulty navigating today’s challenging operating environment, given reimbursement rate cuts, rising costs and persistent labor shortages.
On top of these challenges comes the requirement to comply with the HITECH Act (part of the American Reinvestment and Recovery Act of 2009), which dictates that US hospitals must implement and demonstrate what is called “meaningful use” of electronic medical records (EMR). Although somewhat vague in its wording, and a source of consternation among some providers, the act requires health care organizations to hit measurable EMR benchmarks to qualify for incentive payments—and to avoid stiff penalties.
For most hospitals, implementing electronic medical records is a tough hill to climb. According to the Healthcare Information and Management Systems Society, more than 85 percent of hospitals are outside of the compliance range for meaningful use today. By Accenture’s estimates, roughly half of US hospitals are at risk of incurring penalties when enforcement begins in 2015. EMR strategies represent a huge IT infrastructure effort, and the meaningful-use act now raises the stakes even higher for hospital leaders and health care IT teams.
To understand these challenges firsthand, and to provide guidance as hospitals navigate this complex new EMR environment, Accenture recently conducted in-depth interviews with 15 CIOs of leading firms in the US health care industry. Participating organizations were identified as leaders based on their advanced use of EMR solutions and expected compliance with HITECH. Nearly all the organizations surveyed are expected to attain meaningful-use targets before 2012.
The results of this Accenture study reveal six practices that can help health care organizations implement EMR effectively and optimize their investment, especially as they work to come into compliance with meaningful-use regulations. Ranging from the basic (such as securing commitment from top leadership and managing IT costs) to the more detailed (including strategies for gaining buy-in from clinicians), these practices can help organizations cash in on the incentives of the meaningful-use act while avoiding painful penalties.
Health care organizations that can achieve the operational capabilities of these industry leaders can also make great strides forward in patient care delivery, operating efficiencies and profitable business outcomes.
Our interviews with CIOs of health care organizations point to the need for skillful management of not only financial resources but also programs, talent and stakeholders during each stage of the EMR transition—whether it’s formulating an implementation strategy, establishing a blueprint for change, enabling employees and teams to adopt new ways of doing things or embedding EMR use throughout the entire organization. Here’s a closer look at the six insights our research uncovered.
Make EMR planning and implementation a strategic initiative, not only an IT initiative.
Virtually all of the CIOs we interviewed noted that one key to scoring early wins with EMR implementation was securing the passion and commitment of the CEO and the support of the hospital leadership team before embarking on the journey. Senior leaders must view and frame EMR as a driver of quality care delivery—or, as one CIO put it, a chance to deliver high-quality care to the communities that the organization serves.
Anticipate that the EMR initiative will take longer and cost more than you think.
Most of the health care organizations in our benchmarking study underestimated—by nearly 100 percent—the time and costs associated with implementing advanced EMR functions, including clinical order entry, nursing and physician documentation, clinical decision support and bar-coding medication.
Over time, the greatest share of EMR investment is dedicated to hardware, software and training, which together constitute roughly 60 percent of total EMR implementation costs. However, these costs shrink over time, and the amount spent on support and maintenance labor increases by about four times over the average implementation timeframe.
Build leadership alignment to manage the spike in IT operating costs.
Benchmarking shows that hospitals experience an 80 percent increase in their IT operating expenses while transitioning to EMR, which then translates into increases in the hospital’s overall operating budget. Evidence also suggests that these expense inflections are sustained over the long term.
To manage through the operating cost increases, many of our interviewees recommended simplifying order sets (the standardized list of orders for a specific diagnosis) and reducing the total number of sets. According to many participants, numerous order sets were not actually being used by their organization, and thus they were able to rationalize at least 50 percent of them. This dramatically reduced the complexity of managing, supporting and utilizing the EMR solution.
Focus on acquiring and developing top talent.
Health care organizations are experiencing a significant shortage of qualified IT professionals to meet the demand associated with EMR implementation and support. Nearly every CIO we interviewed noted unfilled IT positions and expressed concern about how their organization would source enough talent from the marketplace, including from EMR vendors, to meet longer-term demands.
Another challenge facing hospitals is how to keep their current IT staff up to date on training. As the technology used in health care becomes more sophisticated, hospitals must identify ways to ensure that their current IT employees have the skills needed to use these new tools.
Think in new ways about your capability and operating models.
Hospital CIOs noted the need to think differently about capabilities required to support frontline EMR users as well as to effectively apply EMR-derived data through health analytics. In terms of EMR training, service and troubleshooting, as the average hospital reached mature levels of EMR functionality and adoption, it had to increase the number of full-time employees focused on health care IT support by 45 percent.
In addition, our data showed that once mature levels of EMR are reached, users rely more on their clinically trained colleagues, such as registered nurses and pharmacists, than on their IT department for EMR support. Our interviewees expressed concern about managing huge volumes of electronic data—something that requires deeper data warehousing, analytics, and statistical skills and tools.
Create a culture that supports effective EMR adoption.
To achieve meaningful use, 75 percent of the clinicians in a hospital must demonstrate consistent use of advanced EMR components, which include computerized physician order entry, physician documentation and closed-loop administration. Every CIO we spoke with talked about the need for a consistent focus on change management and workforce engagement to ensure that key stakeholders, particularly physicians, get behind the effort and understand the benefits of using these EMR components.
Strong personal effort by leaders to shape the culture will often be necessary. One of our interviewees, for example, noted spending at least one evening every week with cohorts of physicians, educating them on the benefits of EMR tools.
Improving chances of success on the EMR journey
Between regulatory changes and mounting pressures on health care organizations to lower costs, improve efficiency and enhance quality of patient care, the implementation of EMRs is a transformational milestone for US hospitals and the health industry overall. Hospitals that make meaningful use of electronic medical records in the coming years will position themselves to capture valuable incentives as well as avoid penalties.
Even more important, successful organizations will equip key stakeholder groups—clinicians, administrative staff and health care IT professionals—with the tools and processes needed to provide high-quality patient care and safety.
While taking the best possible care of patients is a mission that all health care stakeholders hold dear, adopting and using an EMR system requires that people change numerous aspects of how they carry out their work. Those changes can lead to confusion and resistance. Moreover, setting up an EMR system and optimizing the data it generates is time-consuming and expensive.
To surmount the challenges that come with the EMR journey, health care executives can learn a great deal from peers who are further along on the journey. Their insights and recommendations can vastly improve everyone’s chances of success.
About the Author
Kristin Ficery is a senior executive in Accenture's Health Practice.