The Technology Promise: Widespread Use of Electronic Medical Records Promises to Transform Health Care. but Can We Afford It?

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Health information technology (HIT), advocates say, will revolutionize the health care system; make hospitals, clinics and doctors' offices more efficient and effective; save billions of dollars; improve patient safety and health; and increase the availability of health care in rural areas.

"The ability to securely share and store patients' medical information will help doctors diagnose problems sooner, reduce errors and better coordinate care among several providers," says Massachusetts Senator Dick Moore, a key player in the effort to create universal health care in his state and the immediate past president of NCSL.

Two key pieces of federal legislation support a high-tech transformation. Under the 2009 Health Information Technology for Economic and Clinical Health (HITECH) Act, health care providers can qualify for Medicare and Medicaid incentive payments when they adopt certified health record technology. Additional incentives are available for professionals who provide these services in an area that has a shortage of health professionals. As of July 31, more than 13,000 Medicaid eligible professionals were registered for the program, and Medicaid agencies throughout the states had paid more than $165 million to providers. The Affordable Care Act also supports adoption of new technology, especially for accountable care organizations and patient-centered medical homes.

If most hospitals and doctors' offices adopted HIT, the potential savings for the country could reach more than $513 billion over 15 years, according to a 2006 report published in the Journal of Health Affairs. Another study performed by Rand Corporation in 2006 estimated that, if all hospitals had a HIT system, about 200,000 adverse drug events could be eliminated each year, which, according to the Institute of Medicine, kill between 44,000 and 98,000 patients every year.

Studies have found electronic health records can reduce duplication of tests and hospital readmissions, help providers and patients better manage chronic conditions, and lower unnecessary emergency room visits. The Veterans Affairs Administration, for example, found that adopting electronic health records in more than 1,400 of its hospitals, clinics and nursing homes has reduced costs and improved the quality of care received by nearly 6 million patients.

There are real concerns, others point out, that need to be addressed if a revolution in health care technology is going to occur. Reluctance on the part of providers, costs and privacy are key issues.

Lawmakers were promoting HIT even before the recent federal push. Since 2007, NCSL has tracked more than 620 HIT-related bills in all 50 states, with 235 bills in 2011 alone. As of Aug. 1, 74 had been enacted.

Most state laws address high costs and privacy concerns. At least 19 legislatures have passed laws stipulating privacy and security standards to be followed as new technology is adopted.


Reluctance by health care providers to adopt new technology is a key concern. A recent survey conducted by Dell Inc. reported 79 percent of hospital executives are concerned about clinician participation and training in electronic health record technology. Nonetheless, since January 2011, nearly 35,000 health care providers have registered to take part in an electronic health records incentive program.

A new electronic system for maintaining and sharing health records can cost as much as $50,000. …