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EHRs May Slow the Rise of Outpatient Healthcare Costs, Study Says

July 18, 2013
by Rajiv Leventhal
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The use of electronic health records (EHRs) can reduce the costs of outpatient care by roughly three percent, compared to relying on traditional paper records, according to a new study from the University of Michigan that examined more than four years of healthcare cost data in nine communities.

The "outpatient care" category in the study included the costs of doctor's visits as well as services typically ordered during those visits in laboratory, pharmacy and radiology. The study compares the healthcare costs of 179,000 patients in three Massachusetts communities that widely adopted EHRs and six control communities that did not. The findings support the prevailing but sometimes criticized assumption that computerizing medical histories can lead to lower healthcare expenses.

The communities that computerized their records –Brockton, Newburyport and North Adams – did so in approximately the middle of the study period of 2005-2009. All the communities, including the controls, had applied to be part of the Massachusetts eHealth Collaborative's pilot that gave funding and support for entire cities' worth of doctors' offices to convert their records. To maximize the benefit from computerized records, experts believe it's important that the shift occurs throughout entire communities, rather than piecemeal. This real-world experiment gave the researchers a chance to test that premise.

"To me, this is good news," Julia Adler-Milstein, an assistant professor in the University of Michigan School of Information and School of Public Health who led the study, said in a statement. "We found three percent savings and while that might not sound huge, if it could be sustained or even increased, it would be a substantial amount. That said, when we talk about cost savings, it does not mean that the costs went down, but that the costs did not go up as quickly in the intervention communities. This suggests that adopting electronic records helped slow the rise in healthcare costs."

Adler-Milstein and her colleagues calculated healthcare costs per patient per month, which amounted to 4.8 million data points. They examined not only total cost, but broke the data down by hospital care and outpatient care. They further examined outpatient costs for prescriptions, laboratory and radiology. They didn't find any savings when they looked at measures of total cost or inpatient cost. The savings showed up when they narrowed the scope to outpatient care.

On average, the researchers 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, and Adler-Milstein says doctors may have ordered fewer imaging studies because they had better access to patients' medical histories.

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