Is Process a Cure for What Ails Hospital IT Investments?

Ann All

Health care IT is finally reaching a "tipping point" where many hospitals can expect to see payoffs for their investments, according to a PriceWaterhouseCoopers study.


Before this point is reached, hospitals that invest in new technology spend more on operations with little short-term financial relief. Six of 10 U.S. hospitals are at or near the tipping point, PwC found.


Hefty upfront costs, combined with concern over the length of time it takes to achieve returns, is slowing many hospitals' adoption of electronic health records, a key technology that pretty much everyone agrees would dramatically improve patient care. A Pennsylvania health care system featured in this Computerworld piece spent $70 million implementing an electronic records system for its 40 hospitals, clinics and physician practices -- attaining ROI in five years.


The real value in such records, says Rep. Phil Gingrey (R-Ga.), a physician who sponsored legislation that would increase tax breaks for doctors using electronic health records, lies in their ability to streamline processes. This not only cuts down on time required for administrative tasks, freeing up more time for patients, but also helps doctors receive quicker and more accurate payments from insurance companies.


Interestingly, PwC found that hospitals achieve lower returns on their IT investments than other industries. While hospitals spend less on technology than many other businesses, that's not the biggest issue associated with lackluster ROI, says a PwC analyst. Rather, many hospitals fail to make process changes that would fully leverage the value of their tech investments.

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