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Published: 6/15/05
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Can a National Healthcare Information Network Work?

A central medical records database could yield economic and social benefits. However, the network will only succeed if it is designed for all healthcare system stakeholders.

It’s been five years since scientists mapped the human genome — and nearly 40 years since doctors completed the first successful heart transplant — but in the realm of information technology, healthcare’s miracles are limited. Even as so many other industries have shown that handling information electronically is cheaper, faster, and more accurate than using written records, hospitals and doctors have stuck with their paper trails. A recent study by the U.S. Department of Health and Human Services’ Centers for Disease Control and Prevention found that only 31 percent of hospital emergency departments, 29 percent of outpatient departments, and 17 percent of doctors’ offices use electronic medical records.

Proponents say electronic records could reduce clinical errors by creating a central repository for patient information.
Now that the healthcare sector is 15 percent of the gross domestic product and growing, many healthcare experts and policymakers are saying such paper filing systems are as outdated as the house call. Not only should medical records be digitized, they say, but data should also be collected in such a way that researchers can use the aggregate information to monitor the health of the country as a whole. For example, researchers could conceivably use the data to discover previously undetectable patterns — such as the start of an epidemic or geographically scattered outbreaks of illness due to a bioterrorist act.

In Washington, policymakers view the creation of a national healthcare information network as a top priority. Already the government has spent $139 million to support regional healthcare information networks. Dr. David Brailer, a former healthcare systems professor at the University of Pennsylvania’s Wharton School who now serves as the national coordinator for health information technology in the Department of Health and Human Services, noted in a recent speech that President Bush spoke about health information technology 50 times last year and has earmarked $50 million for health IT projects in this year’s budget.

IT and healthcare systems experts at Booz Allen Hamilton and the Wharton School are generally positive about the idea of a universal digital medical records system, and agree that it could yield economic and social benefits. However, they caution that the initiative will succeed only if the focus is kept narrow and includes incentives for all the system’s stakeholders to participate.

The Case for Electronic Records
Improving patient safety is a primary motivator for creating a universal database. Brailer cited one study showing that essential clinical information is often not available in primary care situations. Such data is a major source of medical errors that could be prevented by having accessible and accurate electronic patient records. “This adds to the substantial evidence that health IT — such as computer-physician order entry, ePrescribing, preventative reminders, and bar code scanning — improves care, reduces wasteful and redundant treatments, and prevents medical errors,” he said. “When used as intended, health IT saves lives and saves money.”

Gary Ahlquist, Chicago-based senior vice president and managing partner of Booz Allen Hamilton’s health and insurance group, sees the opportunity to use IT in innovative ways to achieve system-wide improvements. “If we think of this as a utility or a backbone for information flow in the healthcare industry, I think it provides the platform for meeting long-overdue needs for consumers, for providers, for everybody who touches the system.”

Mark Pauly, a professor of healthcare systems at Wharton, is a little less optimistic about the overall effect. “It does have the potential to improve quality and lower costs, and will probably do more good than harm. Having said that, I don’t think it’s the panacea that’s going to make healthcare cheap.” He estimates that such a system could reduce 10 percent of administrative costs, or about two percent of the whole healthcare bill. “Out of $1.6 trillion, that’s not chicken feed,” he says, “but it’s not going to make healthcare as cheap as it was 20 years ago.”

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