Amid a national drive for electronic health records, Blue Cross Blue Shield of Massachusetts will spend $50 million to get one community using the records.
By Marianne Kolbasuk McGee
Courtesy of TechWeb's InformationWeek

If electronic medical records really can deliver revolutionary improvements in the quality and cost of health care, one Massachusetts community is going to find out.

Funded with $50 million from Blue Cross Blue Shield of Massachusetts, a group of health-care payers and providers in the state plans to begin early next year wiring one community with interoperable electronic medical records. Their hope is that the pilot project will convince the health-care community statewide that digitizing and sharing patient records will mean better medical decisions, fewer errors, and lower costs.

"A lot of studies say the use of IT has the potential to transform the health-care industry," says Carl Ascenzo, CIO of Blue Cross Blue Shield of Massachusetts. "But bottom line, unless as an industry we work collaboratively to make this happen, it will happen at an excruciatingly slow pace, like it has so far."

There are 30 to 40 companies participating in the collaborative, including payers such as Blue Cross Blue Shield of Massachusetts; health-related agencies in state of Massachusetts; providers, including hospitals and physician groups; and advocacy groups, including employers that buy health insurance. The community hasn't been chosen yet, but Ascenzo says several already have volunteered.

Massachusetts' effort follows a pledge by President Bush earlier this year to get most Americans using electronic records within 10 years--a mark Democratic candidate Sen. John Kerry, D-Mass., says could be reached even sooner. Health and Human Services Secretary Tommy Thompson and federal IT health-care coordinator David Brailer will unveil a plan for reaching that goal July 21 at a summit of health-care leaders in Washington.

Massachusetts' one-community pilot will likely last about 18 months, providing enough data on quality of patient care and cost to provide solid evidence of whether savings or quality of change. The goal is to expand electronic medical records throughout Massachusetts within seven to 10 years, Ascenzo says.

Other communities have done some pioneering work with interoperable health-care systems within a region, but none of them has reached the level of adoption that the Massachusetts effort expects to get.

The group's plan to get doctors' cooperation is simple: pay them for it. Some of the pilot cost will be payments or grants to doctors who participate, since implementing the technology will disrupt their practices. "A doctor may not be able to see as many patients in a day," Ascenzo says, as the physician gets used to using computers to enter and access patient information, rather than paper charts. "We don't want to hurt the doctors financially."

John Halamka, CIO at CareGroup Health System, which operates five Boston-area hospitals and is part of the cooperative, thinks that's vital to the project's success. "Doctors need to be incentized to order to foster the adoption of electronic medical records because it's the insurance companies that get the biggest payback in this," Halamka says.

A major stumbling block to electronic records adoption is the fact that doctors and health-care providers bear 80% or more of the cost and cultural-change burden, but payers get 80% or more of the cost savings, Ascenzo says. Insurance companies get savings through reduced paperwork, elimination of redundant testing, better adherence to preferred drug formularies, and the like.

Halamka estimates taking the electronic-records project statewide might cost $1 billion, but nevertheless thinks statewide adoption could happen in as few as five years.

Beyond the $50 million from Blue Cross Blue Shield of Massachusetts, other collaborative members are providing resources such as project managers and intellectual property, Ascenzo says. Blue Cross Blue Shield decided to put up the $50 million needed for software, hardware, ASP and integration services, training, and other expenses in order to help expedite the pilot, which might've been slowed down too much by efforts to raise funds from other sources.

The general model of the project will involve peer-to-peer communication, where patient data such as lab results or prescription information can be shared among providers but without ownership of the source data changing. There won't be any centralized database of patient records, and the system will have to comply with the privacy and security regulations of the Health Insurance Portability and Accountability Act.

The group hasn't chosen any technologies or standards for the pilot yet, issues a number of working groups are hammering out. And, Ascenzo says, the group decided not to include any technology vendors as members of the collaborative in order to avoid any potential conflicts of interest that might taint the credibility of the findings from the pilot.