Electronic health records generate substantial cost savings in healthcare delivery

Ongoing public sector investment in information technology in healthcare is necessary to make the electronic health record a reality for all Canadians, and telcos will stand to gain from such investment, says the president and CEO of Montreal-based Canada Health Infoway (CHI). "Healthcare is an information-intensive industry," says Richard Alvarez, who heads the not-for-profit corporation created in 2001, in an interview with Network Letter. Alvarez presented highlights of CHI’s progress since its inception and its vision for the road ahead at the Third Annual Electronic Health Records and Information Systems conference held in Toronto in late November. "The lack of available information in healthcare can be life threatening," says Alvarez, former president and CEO of the Ottawa-based Canadian Institute for Health Information. "When we look at what we have spent on technology in healthcare as an industry, we have not been investing in information technology in healthcare compared to other countries or on technology compared to other industries such as financial services." According to 2004 figures from the Information Technology Association of Canada, less than 2% of total healthcare dollars are dedicated to IT. The funding is needed to meet CHI’s medium-term and long-term objectives. Mandated by Canada’s first ministers of health to oversee the creation of pan-Canadian electronic health information systems through investment in various programs across the country, CHI aims to have a complete basic electronic health record in place for half of all Canadians by 2009. CHI received an initial $500 million in 2001, $600 million in 2003, and $100 million in 2004. CHI works in cooperation with provincial health ministries to implement projects, investing in a 75:25 formula with public-sector partners, and bringing private sector members on board to implement vendor solutions. By the end of March 2007, Infoway will have invested more than $1 billion in various programs relating to nine different spheres: registries; diagnostic imaging; drug information systems; laboratory information systems; telehealth; interoperable electronic health records; public health surveys; innovation and adoption; and cross-program projects. Looking to 2015, the long-term goal of CHI is to have complete implementation of the electronic health record initiative coast to coast to coast and resource requirements to support electronic health records, such as portals where patients can view their records and hospital information systems featuring computerized physician order entry and advanced decision support. The $10- to $12-billion capital cost to reach these objectives is challenging, notes Alvarez. "We are looking at annual savings of $6 billion per year when these goals are realized," Alvarez tells Network Letter. "If we can keep seniors out of acute care beds, for instance with better information systems, that represents a lot of savings." The economic spin-offs in meeting these objectives and maintaining information systems in healthcare will create a new revenue stream for telecommunications firms, predicts Alvarez. "They have already benefited from change management in healthcare," says Alvarez. "If telcos get further into , it will serve them well in the worldwide market. They can provide innovative solutions in telemedicine. It is already happening with high-speed networks being built to serve remote communities in Canada." Alvarez underlined the need for the electronic health record, pointing to statistics demonstrating that inaccurate or incomplete health information diminishes the quality of healthcare. Indeed, according to 2004 statistics from the Canadian Institute for Health Information, nearly one of every four Canadians (5.2 million people) say they or a family member have experienced a preventable, adverse event in 2003. The adverse events ranged from receiving the wrong dose or type of medication to having foreign objects left in the body after surgery. The institute found further in its annual report on health care in 2004 that one in nine adults with health problems said a health professional or hospital gave them the wrong medication or dosage, while one in every 6,667 surgical patients had a foreign object left in their body. The errors were associated with 1.1 million extra days in hospital. "The system is somewhat unsafe right now," says Alvarez. "There are so many inefficiencies and duplication in the system. One out of four Canadians don’t have a general practitioner, and they go from one GP to the next, with their medical information contained in paper files and stored in different places." He added that it is common that elderly people end up in hospital emergency departments because a treating physician had incomplete history of these patients, who may be prescribed medications that they cannot take. "With the electronic health record, there will be savings produced in avoiding unnecessary overnight stays in acute care beds," says Alvarez.Alvarez pointed to data from a 2004 EKOS survey that found the overwhelming majority of Canadians supported the existence of an electronic health record, believing it will mean actors in the healthcare system such as doctors, pharmacists, and nurses will be more effective and that patients will benefit from this increased effectiveness. Alvarez noted that before the existence of CHI, the federal government financed the two-year Canada Health Infostructure Partnership Program, which created a patchwork of pilot projects to advance communication technologies in health care. However, there were no guarantees the projects would continue once funding ceased. And under CHI’s criteria, proposals that have limited lifespan are not worthy of federal dollars, stresses Alvarez. "We are a strategic investor and provide funding based on deliverables," says Alvarez. "We are not interested in pilot projects that are not sustainable. The vast majority of our funding (95%) is for sustainable projects. If the projects become graveyards, it is a waste of time." With a new generation of healthcare providers being technological enthusiasts, end users will embrace telehealth solutions in the not-so-distant future, predicts Alvarez. "There is a generation gap," says Alvarez. "For healthcare providers who have been out of medical school for 30 years, it may be tough to teach them new tricks. They have not been banging down the door to say they need new technologies. By contrast, new doctors won’t practice in settings that are not automated. We have found that once clinicians use the technology, they will never go back to paper."

Electronic health records generate substantial cost savings in healthcare delivery

News | December 21, 2006

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