'Health IT' Debate: Can It Cut Costs?

Policy Makers Wrestle With the Logistics of Electronic Medical Records and E-Prescribing

From the WebMD Archives

June 20, 2008 -- You don't have to go far to find a politician cheerleading for the magical cost-cutting abilities of health information technology.

Democratic and Republican policy makers point to "health IT" like electronic medical records and e-prescribing systems as a big potential money saver for America's inefficient and expensive health system.

But in the glare of computer touch screens and smart cards, it's easy to lose sight of what health IT can do -- and more importantly can't do -- for the faltering U.S. medical system.

The 'Buttered Toast' Analogy

Now one of Washington's most important voices on health care costs is trying to get Congress and the candidates to see health IT in more realistic terms.

To Peter Orszag, director of the Congressional Budget Office (CBO), plugging U.S. health care into computerized IT systems is a lot like plugging in a toaster. It's just one step to having toast for breakfast. And if you think of an efficient, cost-effective, and convenient health care system as having your toast buttered, it's not even close.

"If you just plug the toaster into the wall, the toast is not going to be buttered, especially if you haven't even bought the bread," Orszag told a Capitol Hill forum on health IT on Friday.

Orszag says the point of his toast analogy is this: U.S. health care is riddled with inefficiencies. A recent CBO analysis shows there's $700 billion in potential waste. A lot of it comes from doctors and hospitals using treatments, tests, and procedures without any clear evidence telling them which ones work best, or cheapest.

So even if American hospitals and doctors get "plugged in," they still won't have taken several other steps Orszag and other economists say the country will have to take to get health costs under control. That includes more studies to find out what really works, and then using the clout of government programs like Medicare to only pay for the most efficient care.

"If you just plunk in health IT systems down in the middle of a fragmented system ... you're not going to get very much," Orszag says.


Getting Doctors 'Plugged In'

Right now Washington is debating how to get more doctors and hospitals to "plug in" to health IT systems. A study out this week in the New England Journal of Medicine shows that fewer than one in 20 doctors in small or medium-sized practices are using fully-functioning systems.

It's not that doctors, don't want their "toast buttered," says Sara Rosenbaum, a professor of health policy at George Washington University and one of the study's authors. It's that cost and legal concerns are still seen as a major barrier.

"Despite the delicious nature of buttered toast, 83% of physicians have no functional electronic health record," she said.

"Word on the street is, it takes at least a year to really get comfortable with an electronic record system," adds Janet Wright, MD, vice president of science and quality at the American College of Cardiology.

The Bush Administration just announced it will spend $150 million doling out incentive grants to doctors in 12 U.S. cities in an effort to spur the use of health IT.

Orszag favors a little bit of coercion too. "We'll pay you five bucks to plug in your toaster," he says.

But he also says Congress should set a deadline for doctors to plug in, and once the deadline passes, Medicare should cut off doctors who haven't done it.

"I think that would get nearly universal plugging in of toasters," he says.

WebMD Health News Reviewed by Louise Chang, MD on June 20, 2008



Peter Orszag, director, Congressional Budget Office.

Sara Rosenbaum, professor, health policy, George Washington University.

Electronic Health Records in Ambulatory Care, A National Survey of Physicians, New England Journal of Medicine Online, June 18, 2008.

Janet Wright, MD, vice president, science and quality, American College of Cardiology.

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