Study says electronic records moderate outpatient health costs

Other than the continuing battle over the 2010 Patient Protection and Affordable Care Act, few subjects within the health care sector have proven as controversial as the impact of switching to electronic records on medical costs.

Initially, electronic records were sold as a nearly foolproof way to reduce health care costs. Later, however, many health professionals and academics began to question this assumption.

Now, researchers at the University of Michigan have waded into the dispute. Their newly published study suggests that when it comes to outpatient care, electronic records are proving to be a cost saver.

Julia Adler-Milstein, an assistant professor in the U-M School of Information and School of Public Health, and her colleagues based their conclusions on the impact of electronic patients records on four years of health care cost data from nearly 180,000 people in three Massachusetts communities that have adopted electronic medical records and six communities that have not.

Adler-Milstein and her team found that the use of electronic records in the three communities produce a 3 percent savings over the costs on the other six. The results of the survey were published in the July 16 issue of the Archives of Internal Medicine.

"To me, this is good news," said Adler-Milstein. "We found 3 percent savings and while that might not sound huge, if it could be sustained or even increased, it would be a substantial amount."

She stressed, however, the savings was not the result of a decline in outpatient health care costs, merely a reduction on the rate of increase seen in comparison to the communities in which electronic records were not used.

All nine communities in the study had applied to the Massachusetts eHealth Collaborative's pilot program, which gave funding and support for entire cities' worth of doctors' offices to convert their records. Only Brockton, Newburyport and North Adams were selected to receive the funding.

Some health care finance experts believe a communitywide shift to electronic records is more likely to impact medical costs than having providers switch on a piecemeal basis.

The University of Michigan study found that the switch to electronic records did nothing to moderate health care costs in general and inpatient hospital care in particular.

"That makes sense because the people who adopted electronic records were the community physicians, not the hospitals," Adler-Milstein said.

Some critics of the federal government subsidies to promote a switch to electronic medical records have said switching from paper records would make it easier for doctors to order potentially costly tests, raising overall costs.

Adler-Milstein found an estimated $5.14 in savings per patient per month in the communities with electronic health records relative to those without the records. Most of the savings were in radiology, leading Adler-Milstein to speculate that doctors may have ordered fewer imaging studies because they had better access to patients' medical histories.