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EHRs could equal financial success

December 6, 2010

Electronic health records could mean more than streamlined billing and extra time with patients.

A recent study says an EHR could result in more money for medical practices.

The report, released by the Medical Group Management Association, found that medical practices that have implemented electronic health record software report better financial performance than those who have not.

Practices that were not hospital- or IDS-owned and had an EHR system in place reported $49,916 more in total medical revenue after subtracting operating cost per full-time-equivalent physician than practices that still used paper medical records, according to the study. After the first year of EHR use, the study also showed that medical records and transcription staff costs decreased. Additionally, it found that the highest information technology costs were accrued during that year.

The MGMA also reports that there could be additional financial incentives for switching to an EHR. Medical practices who adopt these technologies may also qualify for up to $44,000 in funding through the HITECH Act, an addendum to HIPAA that addresses the privacy and security concerns associated with the electronic transmission of health information.

While practices utilizing EHR technologies did report greater expenses than those that are paper-reliant – averaging $105,591 per FTE physician – they had $178,907 greater median revenue.

Kenneth G. Adler, in a report for the American Academy of Family Physicians, echoed the findings of the MGMA study and urged other physicians to invest in an EHR, despite the up-front costs.

Adler advised practices to think of that cost as an investment in their financial future. Savings could be seen in the form of reduced transcription costs, less paper chart storage, printing and copying and improved staff efficiency. For example, Adler said if you eliminate half an hour of paperwork each day, you could possibly see two more patients or have 30 more minutes to spend with your family.

Also, EHRs improve coding by reducing the common tendency to undercode, wrote Adler. The electronic records provide better documentation and often incorporate an automated coding adviser, which results in a more accurate use of codes and more accurate payment for the services rendered.

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