The Effects of Computerization on the Cost of Health Care
Health care costs in the United States (as of Spring 2006) are growing at a rate far in excess of anything we've seen before. The National Coalition on Health Care recently estimated the amount being spent on health care in this country was 4.3 times the amount spent on national defense, and growing at a rate more than three times the rate of inflation. The United States is known for offering the best health care in the world, yet the strain our current system is placing on our society is rapidly becoming too great to bear. Are these statistics indicative of a faulty health care system? How can these costs be controlled? As it turns out, the health care system in this nation is woefully under-computerized. From decision support systems to electronic medical records, health care institutions in the US stand to save a lot of money.
Cost Issues in the Health Care System
According to the aforementioned group, health care costs have never looked gloomier. A few statistics from cost analysis reveal:
- The annual premium that a health care insurance provider charges an employer, to cover a family of four, averaged $10,800 in 2005. Coincidentally, this is more than a full-time employee being paid minimum wage will gross in a year ($10,712).
- According to the Kaiser Family Foundation, premiums for employer-sponsored medical insurance are rising five times faster than workers' earnings since 2000.
- A survey conducted in Iowa found that 86% of consumers said they would have to cut back in how much they save in order to meet health care costs, and 44% said they would have to cut back on food and heating expenses.
Some other statistics include:
- In a 2004 article from the Washington Post, workers' costs for health insurance have risen by 36% since 2000.
- The number of americans spending more than a quarter of their income on health care costs rose from 11.6 million in 2000 to 14.3 million in 2004.
- From 2001 to 2004, approximately 5 million workers stopped recieving health coverage through their employer.
- In a 2000 report by the Agency for Healthcare Research and Quality, errors in the provision of health care cost the average large teaching hospital more than $5 million per year.
- The Institute of Medicine reported in 1999 that "medical errors are responsible for injury in as many as 1 out of 25 hospital patients; an estimated 48,000-98,000 patients die from medical errors each year
Medical Errors and Adverse Drug Events
If there was any one reason for inflated health care premiums, it is because of errors made in everyday medical practice. According to the AHRQ report mentioned above, _preventable_ health care related incidents cost the national economy anywhere from $17 to $29 billion dollars in a given year. Of these errors, one particular type - adverse drug events (ADEs) - caused one out of five patient injuries or deaths each year in the hospitals studied.
The AHRQ study breaks these errors down into four categories:
Medication Errors
- Errors in ordering and administering medicine accounted for 56% and 34% of preventable adverse drug events (in a study done in two hospitals).
- Dosage errors were primarily due to a physician's lack of knowledge of a particular drug or about the patient to whom it was being prescribed.
- Few factors were shown to identify patients at risk to be given the wrong drug, leading researchers to conclude that the problem was with medication systems more than it was with particular types of patient.
Surgical Errors
- Surgical adverse events (which accounted for 1 in 50 admissions in Colorado and Utah hospitals in 1992) were two-thirds of all adverse events and 1 of every 8 hospital deaths.
Diagnostic Inaccuracies
- Physicians who performed 100 or more colposcopies (a follow-up test for an abnormal pap smear) per year were more accurated that physicians who didn't perform the procedure as much (practice makes perfect).
- Measuring blood pressure with the most commonly used type of equipment often gave incorrect readings that may lead to a mismanagement of hypertension.
System Failures
- A study in the Journal of the American Medical Association in 1995 determined that failures at the "system level" were the major cause in more than three-fourths of ADEs.
- Another study found that a particular system-level factor, the staffing levels of nurses, influenced the incidence of adverse events following major surgery, including urinary tract infections, pneumonia, thrombosis, and pulmonary compromise.
Automation as a Solution to the Problem
One obvious solution to this growing set of problems is the automation of many average clinical tasks by computer, especially the handling of patient records. However, health care institutions in the US have been slow to warm up to the idea, for varying reasons. But whatever the reason, computerization has been demonstrated as an effective solution to burgeoning care costs.
In another study done by the AHRQ, computers greatly increased the quality of care in practice.
- The HELP system (one of the first systems to combine information storage and retrieval with clinical decision support) showed the risk of wound infection "decreased significantly" when antibiotics were administered two hours before surgery.
- HELP also spotted 60 times as many adverse drug reactions as the traditional method in a study done at the LDS Hospital in Salt Lake City, Utah. 95% of these reactions caught were moderate to severe reactions.
- Physicians at Indiana University were twice as likely to give flu vaccinations to patients at high risk for contracting the disease when reminded by a computer. This lead to a 10%-30% drop in (expensive) tests for respiratory ailments, as well as similar drops in winter hospital stays and emergency room visits.
- At Beth Israel Hospital in Boston, computers alerted doctors as to when a patient's creatinine levels were rising, which is an indicator of kidney failure. Doctors were then able to adjust medication more than 21 hours sooner than if they recieved no notification.
- When physicians at Wishard Memorial Hospital in Indianapolis used computers to write all inpatient orders, total costs came down by roughly $3 million, or about $594 per admission. With workstations linked to an EMR system in the hospital being used to write these orders, total charges per admission went down by $887.
- Physicians ordered 14% fewer tests per outpatient visit when using workstations which showed prior test results, as well as including predictions of abnormal results and test prices.
Electronic Medical Records
EMRs in and of themselves deserve special attention, as they are one of the least-implemented systems and (if done correctly) carry massive reductions in cost. In a five-year-long study published in the American Journal of Medicine estimated the net benefit of using electronic medical records (for a five year period) was $86,400 per provider. These savings primarily came from saving on drug expenditures, improved utilization of radiology tests, better capture of charges, and a decrease in billing errors. What's more, a five-way sensitivity analysis was conducted in order to ensure accuracy, with the most pessimistic and optimistic assumptions ranging from a net $2,300 cost to a net $330,900 benefit (!).
For the Future
While it's true that many computerized medical applications have a long way to go before becoming viable, the facts presented here should be a good indicator of proof-of-concept: that computers really can and will save the health care industry money. Enough money, in fact, to warrant a good solid second (for many, first) look by professionals in health care institutions across the country. More importantly, though, this shows that much of what is to blame for skyrocketing costs is not due to our nation's privatized system of medicine, but rather a discipline that has so far refused to join the rest of our economy in the 21st century.
References
[1] Wang, SJ, et al. A Cost-Benefit Analysis of Electronic Medical Records in Primary Care. The American Journal of Medicine. April, 2003;114:397-403.
[2] Reducing Errors in Health Care. Translating Research Into Practice, April 2000. AHRQ Publication No. 00-PO58. Agency for Healthcare Research and Quality, Rockville, MD. http://www.ahrq.gov/research/errors.htm
[3] Ceci Connolly. Higher Costs, Less Care: Data Show Crisis In Health Insurance. The Washington Post. September 28, 2004; page A01.
[4] Using Computers To Advance Health Care. Research in Action Fact Sheet. AHCPR Publication No. 96-P014, January 1996. Agency for Health Care Policy and Research, Rockville, MD. http://www.ahrq.gov/research/computer.htm
[5] Health Insurance Cost. National Coalition on Health Care. 2006. The National Coalition on Health Care, Washington, DC. http://www.nchc.org/facts/cost.shtml
Joe Fisher