Case study: New York hospital group plans $400 million in EMR subsidies for MDs

Despite recent decisions by CMS and the IRS offering hospitals legal options for subsidizing physicians' electronic medical records, many health systems have held off, fearful that they'd still be at risk for censure by officials if their plans strayed a bit from the safe harbors. A few large systems like Memorial Hermann Healthcare System in Houston and Tufts Medical Center in Boston have already gone down this road, but it's still a tricky area for hospital executives.

Now, North Shore-Long Island Jewish Health System has joined this small fraternity, setting plans to offer its 7,000 affiliated physicians subsidies of up to $40,000 each over a five-year period if they adopt EMRs. North Shore typically will offer 50 percent of the total cost for physicians who install EMRs, but push it up to 85 percent of total costs if doctors agree to share data on key health measures like glucose levels for diabetics. This will be in addition to federal stimulus funds, which could add up to an additional $44,000 per doctor over the next five years.

This program may be the biggest EMR subsidy program in the country to date, analysts say. While physicians generally have complained that the subsidies they're offered don't cut it, this one may actually cover most, if not all, of a practice's EMR expenses.

North Shore will begin the program with only 100 physicians, then expand its rollout gradually. No word yet on how North Shore is financing such a large investment, but if the hospital achieves its clinical goals--better patient health due to closer data management--it's likely to benefit in ways that will extend well beyond its initial investment, execs say.

To learn more about this case study:
- read this piece in The New York Times

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