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ACP Urges Ways and Means to Use Incentives to Promote Health Information Technology

(Washington, DC): Physician practices that invest in health information technology (HIT) generate substantial benefits for their patients, but financial incentives are needed to make adoption of these technologies economically feasible. This is according to testimony that the American College of Physicians (ACP) provided to the US House of Representatives Subcommittee on Health of the House Ways and Means Committee on June 17, 2004.

Increased use of HIT could greatly benefit patients. Electronic Health Records (EHRs) allow physicians to instantly access patient health data from any location with a computer and internet access. HIT can also provide real-time clinical decision support, schedule patient appointments, and assist physician performance measurement.

EHRs have been on the market for over a decade, but most physicians have not implemented EHRs or other HIT in their offices. A recent study shows a median cost of $30,000 per physician for the upfront cost of an EHR system. Physicians also incur the high cost of training staff and converting existing patient data. And, finally a business model does not exist that would allow the physicians to share in the savings to the health care system that these systems generate.

In order to make it economically feasible for physicians to invest in HIT the federal government needs to provide incentives.

The College specifically called on Congress to enact legislation to create financial incentives for HIT, including consideration of the following approaches:

  • A combination of loans, grants, and tax credits to give physicians access to the capital needed for investment in HIT. Such financial assistance could be conditioned on the voluntary participation of physicians in studies to demonstrate the potential benefits of HIT in improving patient care.
  • Reimbursement incentives to physicians who use HIT to improve patient care. Such incentives could include: payments for telephone and email consults made possible through the use of HIT, an "add on" to Medicare payments for office visits that are supported by electronic health records, and changes in Medicare's sustainable growth rate update formula to provide for explicit recognition of the costs of HIT. Because electronic health records are expected to generate substantial long-term savings to Medicare, the financial incentives to acquire and use such technologies should be exempt from Medicare budget neutrality requirements.

The American College of Physicians is the largest medical specialty organization and the second-largest physician group in the United States. ACP members include more than 115,000 internal medicine physicians (internists), related subspecialists, and medical students. Internists specialize in the prevention, detection and treatment of illness in adults.

[Note to Editors: Full text of the testimony is available online.]

Jack Pope, (202) 261-4556, jpope@acponline.org
Jacquelyn Blaser, (202) 261-4572, jblaser@acponline.org

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