Hospital breaks contract over EHR cost

The owners of Juneau, Alaska-based Bartlett Regional Hospital voted recently to break their contract with Cerner for a new system, rather than incur the expense of implementation, according to an article from KTOO NewsBartlett is the latest U.S. hospital to run into financial trouble while installing a new EHR system.

The City and Borough of Juneau (CBJ), which owns the hospital, voted to not go forward with the contract on the grounds that the money had not been appropriated for the project. Implementation of the new EHR would have cost $7.37 million, plus an annual maintenance fee of $1.155 million. The contract had been signed by Tennessee-based Quorum Health Resources, which had managed Bartlett when that the contract initially was signed in 2011. Quorum's management contract was terminated in 2012.

According to KTOO, the hospital will attempt to negotiate a "resolution" with Cerner.

While Bartlett has an existing EHR, according to KTOO, it needs to updated. Such an update would be considerably cheaper than the Cerner contract, according to the article.

Henry Ford Health System reported last month that its investment in an Epic system was a major factor in its 15 percent decrease in net income from 2011 to 2012. Wake Forest Baptist Medical Center also reported that its adoption of a new Epic system caused it to suffer unanticipated losses and business cycle disruptions. These sobering reports continue to raise concern that health IT may be failing to live up to its promises of lower costs and increased efficiencies.   

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