New incentives may speed transition to e-prescribing
Insurers and states see huge savings but doctors worry about cost, disruption
From the October ACP Observer, copyright © 2006 by the American College of Physicians.
By Lola Butcher
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If you don't have electronic prescribing now, you probably will within five years, thanks to a new round of financial incentives from health plans, state legislatures and the federal government, experts say.
More than half the states are planning—or already implementing plans—for programs designed to increase the use of health information technology or spur health information exchange, and e-prescribing is a top priority for almost all of them. The U.S. Department of Health and Human Services (HHS), meanwhile, recently launched a $6 million pilot project to expand e-prescribing and establish technology standards.
Perhaps most importantly, health insurers around the country are putting up money—both in grants and pay-for-performance incentive programs—designed to entice physicians to say yes to e-prescribing. Plus, the Centers for Medicare and Medicaid Services (CMS) recently announced exceptions to its self referral law and the Office of the Inspector General loosened its fraud and abuse rules allowing hospitals and other entities to provide health information and e-prescribing technology to physicians under certain circumstances (see box).
It's no wonder there's so much backing given the goals: Eliminate harmful drug events, perhaps as many as 2 million each year, according to the CMS, and increase physician use of generics—possibly by more than 15%, according to a study by Medco Health Solutions. If replicated nationwide, that trend could cut health care costs by billions of dollars each year.
Given the funding incentives, all that could be a reality soon, even for physicians who have hesitated to take the financial leap into e-prescribing technology. “I think within the next five years, e-prescribing will be the norm,” said Daniel Z. Sands, FACP, an independent health care IT consultant and internist at Beth Israel Deaconess Medical Center in Boston.
What's the hold up?
Actually, most physicians agree that e-prescribing improves patient care while reducing costs. What's been holding them back—only 14% of physicians nationally use e-prescribing, according to a 2005 survey reported by the California HealthCare Foundation—are the following:
Steep costs: Alberto Sobrado, ACP member, an internist in North Andover, Mass., estimated that the total e-prescribing technology costs for 25 providers in his independent practice association came in at under $30,000. While that might work for members of large practice groups or hospital-owned groups, smaller practices—41% of ACP members are in practices with five or fewer physicians, and 20% are solo practitioners—have balked.
“Most primary care physicians are operating at very thin margins and don’t yet have a financial incentive to adopt these systems,” said Steven R. Simon, FACP, an internist at Harvard Pilgrim Health Care in Boston.
Tough transition: The work flow disruption that accompanies any big change can be rough. “Virtually everyone likes it after they’ve made the transition, particularly the e-prescribing,” said David Bates, FACP, an internist at Boston’s Brigham and Women’s Hospital, who has been e-prescribing since 1993. A leading researcher in physicians’ use of technology, he is enthusiastic about its merits even as he is sympathetic with his foot-dragging peers. But, he acknowledged, “The transition is difficult.”
Inconveniences: Yul D. Ejnes, FACP, a general internist in Cranston, R.I., and partner in the 20-office Coastal Medical primary care group, began using e-prescribing for refills three years ago through a statewide pilot program. He likes it, but says his small office—he practices with one other physician and a physician’s assistant—has had the following inconvenience issues that have forced him to essentially run two systems:
- Exam rooms are not equipped with computers, so it is not convenient to use e-prescribing for new prescriptions.
- Several locally-owned community pharmacies are not yet wired to accept e-prescriptions.
- Federal law prohibits certain classes of drugs from being refilled electronically.
Technology concerns: Many physicians are stymied by such technology issues as standards, interoperability, confusion about competing products, and previous bad experiences with technology, said Dr. Bates, who served on a research team that studied e-prescribing initiatives in Massachusetts.
In addition, it is still a hassle for many physicians to send an electronically-generated prescription directly to the pharmacy in coded form because many pharmacies aren't yet ready to receive them, he said. Many physicians who have adopted electronic health records (EHRs) and generate their prescriptions electronically still use electronic faxing.
"The electronic record can include a database of pharmacy faxes, and once the pharmacy for the patient is loaded, the provider can just hit a button and zip it off," Dr. Bates explained. "Our providers love this and use it a lot, especially for refills."
Overcoming the problems
States know why physicians are hesitating. That's what prompted Kentucky commonwealth officials to target what it considers the top barriers to adopting e-prescribing—technology costs and work flow disruption—by awarding grants to partnerships to start e-prescribing. The idea is that if several members of a community—teams of physicians and pharmacists or hospitals--leap into e-prescribing at once, the hurdles will be easier to overcome.
“We’re trying to provide the infrastructure to deal with these two problems,” said Trudi Matthews, chief policy advisor in Kentucky’s Office of Health Policy.
Kentucky is one of 24 states that have passed laws to advance the use of health information technology. But, like their peers in most other states, Kentucky officials won't actually be giving much money directly to physicians—just $300,000 to start e-prescribing projects in four communities.
By contrast, insurers are coming up with big money to encourage e-prescribing. In Pennsylvania, for example, Highmark Inc. gave $26.5 million to The Pittsburgh Foundation to fund an e-prescribing initiative. The Highmark e-Health Collaborative, as it is known, will provide up to $7,000 per physician—or 75% of the total cost, whichever is less—to acquire and install e-prescribing technology. The initiative is awaiting IRS approval of its nonprofit status before it begins making grants.
A $50 million donation from Blue Cross Blue Shield of Massachusetts is funding the Massachusetts e-Health Collaborative, which will pay all costs of adopting electronic health record technology, including e-prescribing, for physicians and hospitals in three communities.
Meanwhile, several insurers have introduced pay-for-performance programs that reward physicians for e-prescribing. In Hartford, Conn., for example, e-prescribing physicians can earn extra money from both Anthem Blue Cross Blue Shield and ConnectiCare.
“We are changing the paradigm of how health care technology is funded,” said Dr. Sands, a former chief medical officer of an e-prescribing technology vendor. “That has really lit a fire under adoption.”
EHRs vs. e-prescribing
But even with extra funding, is e-prescribing the right first step? The federal government thinks so. In announcing a multi-site pilot project that will help develop standards for e-prescribing, HHS Secretary Mike Leavitt in January connected the dots between e-prescribing and fuller use of health IT.
"The new e-prescribing pilot project represents a major step forward in our work to develop and adopt standards for electronic medical and personal health records," Secretary Leavitt said in a press release when he announced the grants. "This pilot will help to create a new age in efficiency and safety in America's medical care industry."
While health plans are focusing on e-prescribing because it saves them money, many state initiatives focus more broadly on developing EHRs and regional health information organizations (RHIOs) because their broader applications hold promise for more dramatic improvements in both health care and cost containment.
On the one hand, the Maryland Patient Safety Through Electronic Prescribing—STEP—initiative, which seeks to advance e-prescribing only, is simply trying to be pragmatic. Leaders of that effort believe that adopting EHRs is too daunting for many physicians, while e-prescribing technology allows them to change their practices incrementally.
Dr. Simon, a leader in the more ambitious Massachusetts initiative, agreed that a free-standing e-prescribing system is less daunting than a full EHR. But the Massachusetts e-Health Collaborative decided not to skip the “shorter hops” approach to physician technology.
“There’s pretty good evidence that you don’t really start to get the benefits, both in terms of improving quality and in cost savings, until you have a complete electronic health record system that has decision support,” Dr. Simon explained.
Yet for many primary care physicians, the thought of spending at least $25,000 per physician for EHR technology is a deal breaker. Dr. Ejnes, for example, has been comfortable using a web-based e-prescribing system that costs less than $50 a month per physician. Later this year, his practice will begin using a full EHR, and, even though the prescription data may not migrate to the new system, he is glad he started with e-prescribing.
“We may be starting from scratch,” he said. “Still we think it was a worthwhile endeavor, because we learned a lot and we were able to work more efficiently.”
Get ready
But with new incentives and programs in place, the financial concerns may be moot. That means that for those who have shied away—for whatever reason—from e-prescribing, the writing is on the wall, many say.
It may take five years or 10, but through a combination of increasing financial incentives for physicians and decreasing costs of systems, e-prescribing will become ubiquitous, Dr. Simon predicted. For physicians who have only seen price tags, this will allow them to focus on quality of care.
"Intellectually and from a quality of care, patient safety and healthcare delivery standpoint," he said, "physicians are ready for e-prescribing."
This month new rules for the federal government go into effect that will make it easier for hospitals and other entities to donate health information technology to office-based physicians. More information from CMS is online.
Massachusetts gets a jump on e-prescribing
Abigail Zavod, ACP member, is a huge fan of e-prescribing. She and nearly 500 other physicians at Lahey Clinic just outside Boston have been e-prescribing since 2004.
“I love the handheld,” she said of the wireless computer that helps her do her work. “I go zip, zip, zip—and it’s done. From a patient safety perspective and on all fronts, it has been a great thing," she said.
Other large organizations in the state—Harvard Pilgrim Health Care, Partners Healthcare System and CareGroup Healthcare System—also are purchasing the technology for their practitioners.
That's bumped Massachusetts physicians to the forefront of the trend toward electronic prescribing. In fact, around 45% of the state’s physicians are using electronic health record (EHR) software, which frequently includes e-prescribing, said Steven R. Simon, FACP, an internist with Harvard Pilgrim. By contrast, according to the most recent government data, just 24% of physicians nationally use EHR systems, he said, while only 14% are e-prescribing (the CDC study is online).
It also helps that Massachusetts is home to some of the leading researchers in physicians’ use of e-health applications, Dr. Simon said. They, in turn, inform the Massachusetts e-Health Collaborative, one of the most well-funded and ambitious state-level efforts in the country.
The initiative, spawned from an information technology summit sponsored by the Massachusetts ACP chapter, is using $50 million from Blue Cross Blue Shield of Massachusetts to cover the costs of universal EHR implementation in all physicians' offices and clinical data exchange among physicians and other health care providers in each of the three pilot communities.
The first pilot went online in March when Highland Primary Care, a four-physician practice in Newburyport, began using EHRs, including e-prescribing. Throughout this year, 40 other practices will follow suit and, in early 2007, will be connected to Newburyport’s hospitals and other health care facilities.
Two other Massachusetts communities—Greater Brockton and Northern Berkshire—are also launching EHR pilot projects this year. The ultimate goal is to allow the exchange of health information between all health care providers—including solo practitioners and small practices—statewide.
That explains the estimated price tag of the entire venture: from $500 million to $1.5 billion. “It’s a substantial sum, but it’s nowhere the near the cost of putting electronic health records in every physician’s office in the state and to connect them with data exchange,” said Dr. Simon, who represents ACP on the Collaborative’s board of directors.
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