Health IT: Unlocking the Logjam

Nearly everyone agrees that done well, health IT will save both lives and money. But it's not in an individual insurance company's best financial interest to help a healthy 30-year-old become a healthy 60-year-old.

Nearly everyone agrees that done well, health IT will save both lives and money. But right now, the technology often costs doctors more than it saves. Insurance companies want more data about how programs save them money, and vendors are having trouble creating and supporting products at affordable rates.

John Glaser is CIO of Partners HealthCare System Inc., an integrated health care delivery system based in Massachusetts that includes Brigham and Womens Hospital and Massachusetts General Hospital. Glaser was chair of the group at the highly respected Markle Foundation that concluded that there was no viable business case for outpatient physicians interested in using information technology to support their clinical practices.

Doctors who adopt health information technology will take a financial hit, said Glaser in an interview with "The average EMR [electronic medical records system] costs $10,000 to $12,000 a year. The average economic value is about $20,000 a year. But two-thirds of the economic value falls to payer or employer."

But payers and employers arent eager to hand out checks to doctors who start using health information technology. "Payers are getting beat up for having high premiums, and now theyre being told that they have to pay more to doctors," said Glaser. "They are nervous about expenses that go up and dont have benefits to go with them."

So payers are more willing to provide incentives for doctors to use e-prescribing systems. Not only is this technology less costly, it can start cutting costs for prescription drugs immediately by encouraging doctors to prescribe the least costly drugs.

Payers are also interested in the cost-benefit ratio of programs that manage patients with chronic diseases. These make sure patients take certain medications, track their symptoms and get preventive care, with an aim to keeping these patients from needing expensive hospital treatment. But an analysis from the Congressional Budget Office found no evidence to conclude that such programs save money, increasing uncertainty.

Sam Nussbaum, vice president and chief medical officer of Anthem Insurance Companies Inc., told attendees at a recent health care IT conference that the analysis was flawed. He presented two studies showing that disease management programs are incredibly cost-effective.

Next Page: The effectiveness of intervention programs.