View the February 20, 2009 UPDATE to this post here.
ASP EMR To Gain Preference? – According to Bloomberg News, the economic stimulus bill approved by the House last week favors health IT firms that operate on an application service provider model over software vendors.
ASP Less Expensive Up Front – The House’s $819 billion economic stimulus package includes $20+ billion for health IT. The bill would provide financial incentives to physicians over time, rather than upfront, lump sum payments. This means doc’s and hospitals will likely opt for a less-expensive ASP EMR solution, versus investing in a locally-installed software package that is relatively more expensive to buy. Or so Bloomberg’s logic goes.
I Don’t Necessarily Agree – On the surface Bloomberg’s logic seems sound, but let’s face it. There’s a lot more to an EMR buying decision than initial cost.
Internet Interruptions – If I’m a doc’, and I’m about to make the leap to managing my practice electronically, I’m certainly going to think about the reliability of the sytem I choose. What if my internet connection goes down, or the speed of my connection bogs down to a snail’s pace? Am I supposed to stop seeing and scheduling patients, and stop prescribing their med’s, until my connectivity is restored?
Security – With all of the state and federal onus placed on practitioners and healthcare facilities to protect and secure patient health information, is it wise to allow such information to vaporize into the web cloud? I would love to see the indemnification provisions contained in an ASP EMR license agreement and the ASP’s terms of service. If anyone has an example, please do forward it on.
Long-Term Value – The fee basis for many ASP EMR arrangements is tied to revenue. Is it better to make a somewhat larger investment upfront, depreciate it over several years, and own it outright? Or, better to make the smaller upfront investment and share revenue indefinitely? I think many EMR buyers will opt for ownership and control of their EMR system.
Initial Costs – Lastly, another flaw in the Bloomberg analysis is the fact that locally-installed EMR systems (software versus ASP) are just not that expensive. You license the software, maybe buy some additional hardware, and it’s off to the races. For a small office practice, initial cost estimates for an EMR system vary from $3,000 to over $40,000. Certainly, wise buyers will do just fine with investing at the smaller end of this range. In the current House bill, independent (not hospital-based) providers can receive up to $15,000 in 2009, and a lesser amount each year thereafter, during a total incentive period of five (5) years. In my mind, the current incentive figures are more than adequate to support purchase of a locally-installed EMR system.
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