Accelerating the Adoption of Electronic Medical Records
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- Caroline Norris
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1 Accelerating the Adoption of Electronic Medical Records For Discussion Purposes September
2 EMR Benefits are Significant... EMR Benefits Consumers: Improved care quality and health Medical record portability and remote access Providers/Physicians: Improved patient information Reduced administrative burden and costs Insight to support health improvement and disease prevention Payors: Easily identified metrics and improved outcomes Reduced cost of providing care Potential efficiency benefits from EMR adoption in the US ($B) 1 Savings category Outpatient Transcription Chart pulls Lab test Drug usage Radiology Inpatient Nursing time Lab test Drug usage Length-of-stay Medical records Total savings Average annual savings (1) Assumes 90% adoption, average annual savings over 15 year period Sources: Health Affairs Journal, Sept/Oct 2005; Medicare Expenditure Panel Survey,
3 And Many Groups Have Successfully Advocated for EMR Adoption Trend has been for large employers to push for change as payors Government focus has been on developing standards 3
4 Yet Many Barriers Still Exist Lack of technological standards Physician readiness to adopting EMR Tight Medicare reimbursement policies As of 2005, only 9.3% of U.S. physicians have a complete EMR system 1 with growth estimated at 3-6% Few provider incentives for capital investment Implementation and maintenance costs with lack of a clear payor Legal hurdles: liability, privacy and information sharing concerns (1) 23.9% of physicians reported having some level of EMR (partial or full) Sources: Institute for Health Policy, Massachusetts General Hospital/Harvard Medical School, September 2006; 2005 CDC survey; Burton, et al, Milbank Quarterly 2004; University of Victoria School of Health Information 4
5 EMR Need is Great Among Senior Citizens 41 million Medicare beneficiaries 87% with 1+ chronic conditions 67% with 2+ chronic conditions The elderly account for 60% of U.S. Healthcare spending Medicare spending exceeds $300 billion with 7% growth significant Medicaid spending also supports seniors Many senior citizens use multiple medications drug interaction risks are high Seniors often have multiple health care providers Family members, sometimes geographically remote, frequently assist with care Seniors often have difficulty accurately portraying their complex medical history to providers, particularly in emergency situations Sources: National Coalition on Health Care, Rand Corporation, Centers for Medicare and Medicaid Services, U.S. Department of Health and Human Services 5
6 CMS Incentives Could Take EMR Adoption to the Tipping Point One potential model Proposed stakeholders (1) Medicare beneficiaries elect to have their health records hosted electronically (2) CMS incentives EMR setup at $200/beneficiary with additional annual record maintenance supplement (3) Incentives provide the market impetus for EMR hosting entities to expand presence and reduce the cost of adoption for physicians Industry stakeholders work with CMS to develop standards Provides coordination support, and clinical experience Precedent exists for CMS to successfully incentivize electronic transition Secretary Leavitt has expressed an interest in developing incentives Standards will result as transition occurs 6
7 Next Steps Identify other potential Industry Stakeholders Meet to develop incentive framework, create business case and align government relations efforts Present model to CMS 7
8 Appendix: Erickson Overview 8
9 Erickson Overview and CMS (1) Erickson Overview $1B private developer, builder, manager of 18 communities Serving 18k seniors, employing 10k, growing 20% per year Established in 1983 with the vision to enable successful aging CMS Demonstration Program Called Erickson Advantage, the only plan of its kind in the U.S. Medicare Advantage health plan not bound by Medicare rules & regulations Erickson Advantage Results to date Erickson Health Competitive advantage of living in an Erickson community Full health/wellness support 45 onsite fulltime physicians: the largest geriatric practice in the U.S. $150M in 2005 revenues Acute Hospital Days per 1,000 enrollees National Average 1,860 Days Erickson Average YTD 1100 Days Short Stays Acute Care hospital Days National Average 5.9 Days Erickson Average YTD 4.0 Days Skilled Environment (Sub-Acute) Natl Avg Length of Stay is 25 Days Erickson Avg Length of Stay is 9 Days Avg 30% savings to Medicare spend (1) Centers for Medicare and Medicaid Services, U.S. Department of Health and Human Services Source: Erickson Retirement Communities 2005 and 2006 YTD financial and clinical results 9
10 GE and Erickson Background EMR Adoption at Erickson Rolled out GE Centricity in 2003 in 8 mos. Now one of GE Healthcare s largest Centricity EMR users with 70 providers and 1,000 users Today at 16,814 active medical records Early Adopter Program for Centricity EMR 2005 and went live in October 2005 Enabled a Resident Health Portal Centricity Outcomes Reduced hospitalization Rapid drug recalls Vioxx within 15 minutes, Erickson had identified all residents on Vioxx and notified all of them by end of day Low usage of dangerous drugs Medications which should always be avoided by the elderly and those which are rarely appropriate for use Erickson rate: <0.5% Avg 10 HMOs: 5.1% and 15.7% In addition to industry-leading EMR usage, Erickson has also started the process of building Regional Health Information Networks (RHINs). Disease Prevention High flu vacc. rate Erickson: 92% We aim to provide seniors with the best possible healthcare: to accomplish this, we need to get providers on board with electronic records. Source: Journal of the American Geriatric Society, Feb 2005; internal drug recall review Sept
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