Question

In today's world of healthcare, capital expenses are a common element to the financial management process. In fact, all healthcare organizations, at some point, must convert to an Electronic Health Record (EHR) system to be compatible with the rest of the world. However, this is a major capital expense that will cost many healthcare organizations millions of dollars. Purchasing an EHR system will undoubtedly require the acquisition and use of long-term assets under a capital budget.

The final assignment of your project will require you to make a recommendation to finance an EHR system, Using financial documents that we learned about you will need to make a formal presentation. You will compile all the information in a proposal format, which will be addressed to the organization's executive managers. You will create a separate presentation as an overview of your proposal.

Your organization is considering financing a 1.5 million dollar EHR system (if an EHR system not a good fit for your case, you can choose any major health information system/technology but the 1.5 million dollar reference should remain the same). Based on the financial outlook of your case/organization, make a recommendation to purchase or not purchase the system. You will need to draw on the material you have learned in throughout the class and assignments; as well as background information from your case description. Collectively, that information will serve as the foundation to support your recommendation.

Your organization is considering financing a 1.5 million dollar EHR system. Based on the financial outlook of your case/organization, make a recommendation to purchase or not purchase the system. You will need to draw on the material you have learned in throughout the class and assignments; as well as background information from your case description. Collectively, that information will serve as the foundation to support your recommendation.

This is all fictional. The case is about Patient Access and Patient Financial service. I need to make a presentation explaining the importance of adding an EHR to the organization and how this will affect the copany's capital expenses.  

Answer 1

Electronic Health Records (EHR) is real-time, patient-centered records that make information available instantly and securely to authorized users. While an EHR does contain the medical and treatment histories of patients, an EHR system is built to go beyond standard clinical data collected in a provider’s office and can be inclusive of a broader view of a patient’s care.

The benefits of EHRs are:

·         Contain a patient’s medical history, diagnoses, medications, treatment plans, immunization dates, allergies, radiology images, and laboratory and test results

• Allow access to evidence-based tools that providers can use to make decisions about a patient’s care.
• Automate and streamline provider workflow.
• With EHRs, information is available whenever and wherever it is needed.

·         Improved Patient Care

·         Increase Patient Participation

·         Improved Care Coordination

·         Improved Diagnostics & Patient Outcomes

·         Practice Efficiencies and Cost Savings

Although Electronic Health Records (EHR) systems provide various benefits, there are both advantages and disadvantages regarding its cost-effectiveness. A study should be done to analyze the economic effects of EHR systems using a cost-benefit analysis based on the differential costs of managerial accounting.

When engaging in an EHR implementation cost breakdown it is important to consider that implementation budgets should include direct costs such as:

• software licensing
• projected maintenance
• consulting and training fees
• labor including overtime
• hardware (if required - usually only required for on-premise installations)

Further it is important to also consider indirect costs such as:

• decreased revenue
• lost productivity
• decreased patient visits

When quantified, these can have a significant impact on how an implementation impacts the overall EHR budget.

Widespread use of electronic medical records could bring beneficial change to the health care system in a variety of ways, largely because they are the foundational piece to many technologies and analyses that could change health care delivery. Having every patient’s data stored electronically, in a standardized form creating an easy transfer and comparison of data among providers, insurers, and researchers will allow the recognition of patterns that could provide smarter, more targeted personal, population, and public health measures. For example, the development of not just personalized medicine, but predictive medicine; reductions in medical errors; better disease management and treatment adherence; predicting and potentially preventing disease outbreaks; elimination of insurance fraud; identification of the most effective treatments for the fewest dollars; and identification of the best treatments that are worth the extra money.

All of these potential advances could greatly improve health outcomes and help bend the health care cost curve. Unfortunately, these advances come with significant costs, both financially and in terms of personal privacy. Going forward, policymakers should work to ensure limited resources are used in a more cost-effective manner.