The healthcare industry has always lagged behind the rest of Corporate America in regard to information technology. However, the Obama administration has devised its own remedy to make this sector a healthy contender in the ongoing race.Under The American Recovery and Reinvestment Act of 2009—signed into law by President Obama last February—the government has instituted a $19 billion plan to hasten the adoption of electronic health records (EHRs) in hospitals and doctors' offices. Fueled by incentive bonuses, the ambitious plan has sparked bold predictions of a troubled fate for small physician practices as consolidation becomes more frequent.
Although the direction is clear, one question still remains. How long do we have to wait for the results? The general consensus indicates five years. According to the Centers for Medicare & Medicaid Services (CMS), provisions in the Recovery Act will authorize bonus payments "for eligible professional and hospitals participating in Medicare or Medicaid if they become meaningful users of certified EHRs" beginning in 2011. These incentives are expected to lessen the financial burden healthcare providers may face to incorporate this technology.
Furthermore, beginning in 2015, the Recovery Act will mandate penalties under Medicare "for eligible professionals and hospitals that fail to demonstrate meaningful use of certified EHRs," said CMS.
But not everyone is buying the hype. Take Jim Magdaleno, for example. Magdaleno, product manager – healthcare for Oxnard, California-based TFP Data Systems, argued that electronic filing has been a major topic ever since the Health Insurance Portability and Accounting Act (HIPAA) back in 1996. Fast forward 13 years later, and it's the same old discussion.
"Even though the current Obama administration is aggressively pursuing full compliance of electronic transmissions in all healthcare within five years, it's highly unlikely that it will occur. First, HIPAA has been trying to accomplish this since 1996. Then, we have to look at the small physician landscape and the data shows that 91 percent of small medical practices in the United States are not using electronic filing procedures where it pertains to diagnosis, prescriptions and insurance billing," he stressed. "The data also shows that it could cost anywhere from $25,000 to $40,000 per doctor to make the transition from paper to electronic, and could take up to four to six months. Is there a stimulus reimbursement available for physicians? Yes, but there are stipulations and guidelines by Medicare and Medicaid and [it] will take as long as five to seven years for doctors to recoup any part of it."