Transition to hospital employment will accelerate EHR adoption

The epochal shift of office-based physicians to hospital employment promises to have as big an impact on the adoption of electronic health records as the government's HITECH incentives will.

A recent study published in Health Affairs shows that in 2007 and 2008, the probability of physicians employed by healthcare systems having basic EHRs was 22 percent greater than for solo practices. In contrast, the likelihood of a doctor in a physician-owned group practice having an EHR was only 8.3 percent greater than for a soloist.

There are two underlying reasons why hospitals are buying EHRs for their employed doctors at a faster rate than private practices: First, hospitals have deeper pockets than most physician-owned practices; second, many hospitals see a need to become accountable care organizations (ACOs) in order to prepare for future changes in reimbursement. As Donald Berwick, administrator of the Centers for Medicare and Medicaid Services (CMS), recently pointed out, health IT will be a core functionality of ACOs, which will need it for care coordination and quality measurement.

Since 2000, a recent article in the New England Journal of Medicine notes, the number of physicians employed by hospitals has increased 75 percent to around half of all U.S. doctors. And a recent survey of hospital executives indicated that three-quarters plan to hire more doctors in the next three years. As this trend continues, the number of employed doctors with EHRs is bound to grow. At the same time, vendors and consultants tell FierceHealthIT, more private practice doctors also are buying EHRs to take advantage of the meaningful use incentives.

Finally, the increasing adoption of EHRs by their peers will force many holdout doctors to do likewise. "If practitioners all around you are using health IT at a certain level, you are going to have a hard time collaborating with your peers if you don't," Dr. Robert Kocher, a co-author of the NEJM article, told the New York Times.

The bottom line is that the combination of government incentives and market changes is likely to push physician EHR use to the tipping point within the next several years. And the move to hospital employment has other implications for health IT, as well.

For one thing, the basic EHRs purchased by many solo and small-practice doctors won't meet the needs of large healthcare systems--or the criteria of meaningful use. So as these physicians go to work for hospitals, their new employers are likely to replace their systems with enterprise-wide EHRs that have more functionality and can exchange data between hospital and ambulatory-care settings. Similarly, as more physicians go directly into hospital employment out of residency, they're likely to use the systems most favored by hospitals--assuming they're usable.

Another likely consequence of doctors' shift to hospital employment is that fewer hospitals will consider providing EHR subsidies to private practices in the community. Only a small fraction of hospitals have done this since the relaxation of the Stark self-referral rules five years ago; it now seems, though, that, except for some very well-endowed healthcare systems (like North Shore Long Island Jewish in Manhasset, N.Y.), most hospitals are focusing primarily on rolling out EHRs to their own employed groups.

One way or another, however, doctors will get EHRs--and hospital employment will be the vehicle for many, if not the majority of them. - Ken


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