NYT: EHRs may drive up medical bills

Two reports tie EHRs to higher spending

The move toward electronic health records (EHRs) may be contributing to billions more in spending by Medicare, private health insurers, and patients, the New York Times reports.

The administrations of President George W. Bush and President Obama have encouraged the adoption of EHRs, based on the idea that they reduce costs by avoiding duplicate tests and increasing the quality of care.

However, two recent reports show that EHRs are pushing up the cost of care, not saving money.

A report by the Center for Public Integrity released earlier this month analyzed 362 million Medicare claims between 2001 and 2010 and found that during that time, providers began using more higher-paying billing codes for Medicare office visits while reducing the number of lower-paying codes. The report found that such "upcoding" added at least $11 billion to physicians' fees during that time.

Meanwhile, a New York Times analysis of Medicare data from the American Hospital Directory found that hospitals in 2010 received $1 billion more in Medicare reimbursements than in 2005, at least in part because of changing billing codes used in emergency departments. Furthermore, it found hospitals that received federal incentives to adopt EHRs experienced a 47% increase in Medicare payments from 2006 to 2010, compared with a 32% increase for hospitals that did not receive government EHR incentives.

Why EHRs may be driving up health bills

Some experts attribute a large percentage of the higher costs to EHRs, noting, for example, that the electronic systems allow physicians to cut and paste the same examination findings for multiple patients—a process called "cloning" that makes it seem as if doctors conducted more thorough exams than they actually did.

Critics have said such misuses are common. Donald Simborg, chair of federal panels looking into the potential of fraud with EHRs, said, "It's like doping and bicycling. Everybody knows it's going on."

Hospitals respond to EHR fraud claims

Many hospitals and physicians counter that EHR systems simply allow them to better document the care they have been providing all along.

David Brailer, former National Coordinator for Health IT, says that many providers were actually underbilling before they began keeping EHRs. However, Brailer acknowledged that using EHRs "makes it faster and easier to be fraudulent" (Schulte, Center for Public Integrity, 9/19; Abelson et al., New York Times, 9/21; Schulte et al., Washington Post, 9/15).

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