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ChartLogic Team

Technology and Healthcare Spending

December 12, 2011

Biller, PM 2 Minute Read

Donald Berwick, former head of Medicare and Medicaid, said in a press conference recently that 20 to 30 percent of healthcare spending is wasteful and of no value to patients. Considering that health costs account for 17 percent of the GDP, this statement is troubling indeed. Berwick estimates that Medicare and Medicaid could save up to $250 billion a year by eliminating wasteful spending.

Most of the wasteful spending is due to lack of communication, superfluous regulations, and complex administration, all of which can be better managed through technology and more effective guidelines.

Most doctors realize that patients often receive more care than they need. A stream of questions from one overly concerned patient can lead to extra office visits or extra time spent on the phone, which of course results in extra spending with little or no benefit gained (on behalf of the doctor or the patient). EHR technology can reduce this burden in many ways. Examples of this are (1) personalized patient education materials for patients to take home and refer to later, (2) a patient portal, which allows staff and patients to communicate online through a secure portal at their own convenience, and (3) easily accessible information about the patient’s medical history, including previous testing.

Billing and administration can turn into semi-organized chaos without good practice management software. More than just money can be saved by better managing accounts receivable, scrubbing claims, checking for eligibility, and accomplishing many other administrative tasks electronically. Great savings in time, an equally valuable commodity, are also realized.

Perhaps America’s worst healthcare inefficiencies, though, stem from insufficient communication. On a paper system, it is impossible for providers, referring physicians, and office staff to record and access patient and medical practice information in a timely manner. Many practices have staff specifically assigned to pulling and re-filing charts all day. On an electronic system, by contrast, this task is eliminated. Information is easier to access and share in a protected, secure environment, and costly medical errors and redundancies can be avoided.

We’re already on the road to universal electronic health records and exchange, but the massive savings this technology promises won’t be fully realized until health information technology is more widespread throughout the industry.

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