Study: MU program may not have been best ROI for feds

The Meaningful Use incentive program may not have been the best use of the government's money since the industry was already moving toward using electronic health records and would have met the same adoption goals just two years later, according to a new paper from the Cambridge, Massachusetts-based National Bureau of Economic Research.

The paper, "Investment Subsidies and the Adoption of EMRs in Hospitals," compiled and analyzed data from HIMSS' database, the Medicare Healthcare Cost Report Information System and information from the American Hospital Association. The research revealed that while the adoption rate of EHRs grew from 48 percent of hospitals in 2008 to 77 percent in 2011, since the HITECH Act didn't target only new EHR adopters, only 10 percent of hospitals adopted EHRs because of the HITECH Act. Moreover, without the incentives, the adoption rate would have been 67 percent in 2011, and 77 percent in 2013, since adoption was already a "preexisting trend."

The research also found that the cost of generating the additional adoption was $48 million, so that the $27 billion earmarked for incentive payments by the HITECH Act may not have been the best return on investment.

"Notwithstanding the potential benefits of 'Meaningful Use,' our findings suggest that HITECH's subsidies were not a particularly cost effective way to spur EMR adoption," the researchers said. "Understanding the role of government funds to spur the adoption of technology is important for reasons beyond simply evaluating the efficacy of HITECH. Future attempts at solving market failures within healthcare may require meaningful government investments, and it is therefore critical to understand the effect of incentive payments in this economic context."

They also suggested that "it may be better to ultimately judge HITECH on the impact of Meaningful Use requirements on outcomes such as costs and quality, something that has yet to be determined."

The paper did not evaluate the impact of government incentives on physician adoption of EHRs, although at least one study has questioned whether physicians are seeing a return on investment for use. The Institute of Medicine recently created a tool to help hospitals determine their return on investment of EHRs.

A recent report to Congress found that 92 percent of eligible hospitals and critical access hospitals have received Meaningful Use incentive payments.

To learn more:
- read the paper