EHR Implementation Cost Breakdown: Logistics of EHR Implementation Costs

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The use of electronic health records, or EHR Software has become customary for health organizations over the years. Both EHR and EMR software have transformed the way that the healthcare industry conducts patient care. These systems not only make patient information more accessible, but also keep it secure while maintaining patient privacy.

Not to mention, EHRs makes charting and recording much easier while resulting in fewer documentation errors. These are just some of the reasons why many healthcare organizations are going through the process of EHR implementation. Throughout this article we’ll discuss the EHR implementation cost breakdown and give you an idea of what to expect when adopting this software.

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EHR implementation cost breakdown

Many health facilities rely on these solutions to streamline their daily operations and provide greater quality health care. Unsurprisingly, the majority of health organizations’ main reason for implementing EMR or EHR software has to with increasing efficiency. Additionally, a recent study reported that 38% of healthcare CIOs listed “EMR optimization” as their organization’s top area of capital investment. Throughout this article we’ll dive deeper into the cost of implementing EHR.

One of the biggest reasons healthcare organizations resist EHR adoption has to do with the heavy costs; however, the end result tends to lead to greater revenue. A lot goes into selecting an EHR system, so it’s important to prepare ahead of time and consider a number of factors when choosing. Over the course of the article we’ll discuss the costs of implementation as well as some things to consider before doing so.

  • Why EHR software is worth implementing
  • The true cost of EHR implementation
  • Choosing an EHR champion

Why Implement EHR Software?

Electronic health records are a huge step up from paper records. Any healthcare provider — from a solo family physician to a large hospital system — can benefit from implementing this powerful piece of health information technology. Patient care is more efficient, and medical records are more secure when stored in an electronic format. Here are a few of the ways EHR adoption and implementation are beneficial:

Easy Access to Patient Medical History

EHR software gives physicians a patient’s entire medical history at their fingertips. Updates to patient information can be made in real time, giving each physician an up-to-date and accurate patient file. If a patient needs to see a specialist, EHR systems make it easier for physicians to share important information. The specialist’s office can gain access to health information like medication lists, immunization records, allergy lists, recent test results or the patient’s medical history. This can be as simple as the specialist’s office logging in to the health record. Some electronic health records systems also allow providers to fax information directly from a patient’s chart.

DrChrono EHR Dashboard

Check patient information and medical history using DrChrono EHR

Increased Efficiency

An EHR enables your physicians to spend less time documenting information and focus more of their efforts on providing care for their patients. This allows your health organization to increase daily traffic, in turn treating more patients. Documenting and charting electronically not only frees up more time, it also leads to more accurate information. Documenting by hand is prone to handwriting and legibility errors, whereas an EHR helps to reduce these mistakes.

One of the most important things an EHR does is automate tasks such as scheduling, billing, claims management, revenue cycle management and more. Health analytics can be used to provide greater insights and recognize patient patterns as well as recommend treatment options. By speeding up appointments and automating a variety of time-consuming tasks, your healthcare professionals are able to treat a larger number of patients without sacrificing quality of care in the process, leading to greater revenue opportunities.

Increased Portability of Health and Medical Records

One of the biggest benefits of EHR software is it’s interoperability. If a patient moves or chooses to switch providers, electronic health records make it easier to transfer patient information. With paper charts, each page has to be copied on a copying machine. With electronic records, the patient’s chart can be printed easily from a computer or transferred to a USB drive. The new provider can also gain access to the patient’s chart by logging in to the original provider’s health record. This helps save time and provide more accurate care over a patient’s entire health spectrum. If a patient changes health providers or sees a different specialist, their medical history can follow them, preventing the need for an entire evaluation at each organization. In other words, if a patient switches to another facility, they don’t have to start from ground zero, physicians can get caught up quickly and easily.

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Protection from Fire, Flood or Theft

Paper medical charts are vulnerable to fire or flood. They also run the risk of being misplaced or stolen. With electronic records, the charts are backed up on servers located far away from the clinic or hospital. Natural disasters are less likely to destroy them, and there’s little way for them to be misplaced or stolen. Electronic health records are backed up frequently on other servers and protected by password from theft.

A Better Connection to Pharmacies

Without an electronic system, prescriptions have to be called in to a pharmacy or written out by hand. This leaves room for errors, especially with physicians’ frequently messy handwriting. Incorrectly reading a physician’s prescription could lead to a patient receiving the wrong medication or dosage, which could make them even sicker. With electronic records, physicians can log in to a patient’s chart, choose the medication and dosage from a drop-down list and send the information directly to the pharmacy. Medications can automatically be checked for any drug-to-drug or drug-to-allergy interactions that may occur based on a patient’s current medication and/or diagnosis.

AdvancedMD EHR Tools

E-Prescribing tool for AdvancedMD EHR

The Medicare and Medicaid EHR Incentive Program

Yes, there’s a direct incentive from Medicaid for owning an electronic health records system. The incentive? Cold, hard cash, to the tune of tens of thousands of dollars. Although not every healthcare organization is eligible, there are more eligible providers than you might think. One of the requirements is that a healthcare provider becomes a “meaningful user of certified EHR technology.” The minimum requirement or this is simply a signed contract with a qualified EHR company. In other words, you don’t even need to have it fully implemented in order to receive benefits.

Since you only need a signed contract to be eligible, this means you don’t have to rush into an EHR implementation. You can take your time in order to make sure that you do the process right. And the best part is, not only will you enjoy the benefits of the program, but soon afterward, you’ll get the benefits of EHR adoption as well.

As you can see, there are many reasons to upgrade a paper chart system to an EHR system. As one of the most popular categories of medical software available today, more and more medical practices are reaping the benefits of EHR.

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EHR Implementation Costs

Let’s say you’ve checked out a bunch of EHR products, created a shortlist of contenders and decided on which one to buy. You’re prepared to pay what the EHR vendor asks, so you’re all set now… right? Well, no. Unfortunately, implementing EHR technology comes with its own set of costs, and if you don’t prepare for them, the installation won’t go well. To fully evaluate your EHR implementation costs, you need to prepare for both the direct and indirect expenses involved.

Direct EHR Implementation Costs

A Health Affairs study estimates that the typical multi-physician practice will spend roughly $162,000 to implement an EHR, with $85,000 going toward first-year maintenance costs. Practices who implement an EHR solution can expect to cover the cost of their EHR in about two and a half years and then receive an average of roughly $23,000 in net benefits per year for each full-time employee.

Remember, not every EHR solution will cost the same as a number of factors can affect the amount you’ll owe. I.e., your expenses will vary depending on which deployment method you choose (on-premise vs. cloud). Regardless of which approach you take, however, you may face another major investment.

One approach to buying electronic health records is to deploy it on-premise, meaning that you’ll host the EHR solution on your own servers. This requires the purchase of a perpetual license, which usually comes in the form of a large upfront fee. If you go with an on-premise server model, you’ll have to manage all of the back-office technology involved in running the EHR product. This includes heavy-duty servers, some form of data backup, data storage and possibly other technologies as well.

The other common deployment option is cloud-based, where your data is stored on the vendor’s servers and you access it through the internet. This model includes an ongoing subscription fee paid monthly or annually. If you choose to deploy a cloud-based EHR system, you may pay an initial startup fee (though not nearly as much as an on-premise fee) in addition to the subscription. Of course, given that the vendor handles the hosting, you won’t need to lay out money for extra servers, storage, data backups, security and the like. You may, however, be limited by how many of your employees can access the software. In some cases, if the number of users grows, you have to pay a higher monthly fee.

While cloud-based solutions are typically less expensive, with fewer upfront costs, certain medical facilities may benefit more or less depending on a variety of factors, such as clinic size, number of physicians, physician preference and more.

Indirect EHR Implementation Costs

In addition to upfront and standard EHR fees, practices also face some indirect EHR implementation costs, and they’re far from trivial. Budgeting for these investments is critical, as they represent a significant share of the overall EHR implementation budget.

For example, you often have to include training as an item in your EHR implementation budget. Training can be expensive, but if you don’t budget for it, you’ll pay more over the long run as your physicians and staff struggle to keep up with their duties. While you can go with lower-cost training for particularly tech-savvy employees, don’t skimp on more intensive training for those who need it, as it will end up saving you money in the long run.

Bear in mind that for a short time following an EHR implementation, your physicians will be less productive than they had been in the past. This is practically unavoidable, as you’ll want to get your employees familiar and comfortable with the software rather than rushing it and risking errors.

Adding to this, many practices assume that each physician will see one fewer patient per day for as long as six months after the EHR implementation. Regardless of how you manage things, it’ll take your physicians a while to get back to their former level of productivity. However, productivity should improve overall once this transition period is over. Given the extent to which practice productivity varies, it makes sense to prepare a best- and worst-case scenario, calculating the financial impact of each.

Staffing-Related EHR Implementation Costs

Yet another consideration is the extent to which you’ll need to shift your IT staff after the EHR software goes live. Even if your practice has relatively minor IT needs, consider whether you’ll need extra IT expertise to support the implementation process.

Almost every medical practice has to keep some IT tools (such as practice management software or email servers) available around the clock, and supporting these systems takes effort. While most cloud-based solutions provide their own technical support, on-premise systems typically require an IT team of your own. If you suspect that your IT team is overloaded already, budget for a temporary IT worker or consultant to keep the new EHR application running properly. This is especially important for on-premise EHRs, which require regular maintenance in order to keep the servers and other architecture running properly.

Remember that you don’t want to overstress your employees, blowing the chance to make them comfortable with the new EHR. If you intend on keeping your patient volume at the same level as pre-implementation, you may need to add a temporary physician or other clinician to the mix for a little while.

Expect the Unexpected

Finally, it’s important to note that you may face unique EHR cost issues that aren’t listed here. The point is not to adhere religiously to a single set of standards, but rather to understand what issues you may face and assess your situation accordingly. After all, nobody can fully predict every cost that they might incur during an EHR implementation. But if you keep these principles in mind, you’re far less likely to be taken by surprise after the EHR purchase is complete.

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Do You Need an EHR Implementation Champion?

We’ve covered the benefits and costs of an EHR Implementation, so now it’s time to actually do it. Unfortunately, the process of actually implementing it can create a lot of havoc within your medical practice. One of the best ways to ensure a smooth, streamlined EHR implementation is by selecting a member of your staff to champion the process. This person essentially takes on the role of liaison between your clinicians and the software company.

Indeed, having someone manage the process — including getting everyone on board and comfortable with the system — is necessary. The question is: whom should you select? As you can imagine, certain people are better suited for the job than others. You’ll want to choose somebody who is well-respected and knowledgeable of your facility. Keep the following characteristics in mind in order to pinpoint the member of your team that’s best suited for the task:

Knows Your Staff Well

It’s important to get everyone on board with the idea of switching to an EHR system, and a great way to do that is by assigning each member of your staff specific duties and responsibilities to handle as the process unfolds. This way, they’ll have something of a personal stake in the implementation. Your EHR champion should therefore know each staff member as well as their individual capabilities and talents. They should know which tasks to assign to who and know the best way to explain various aspects of the system to each individual.

Holds Others Accountable

Assigning tasks to staff members is one thing — making sure that they follow through is another. Your ideal EHR champion will have a track record for holding people accountable for the roles to which they are assigned. They won’t be afraid to nudge employees who are falling behind, and they’ll make sure that staff members are spending plenty of time trying the new system and completing their assigned training tasks.

Will Work Closely with the Vendor

Whomever you choose should have the flexibility to devote plenty of time toward working closely with the EHR vendor. In so doing, they will develop a strong, clear understanding of the software, including technical aspects like customization, data transfer and physician verification. The right individual must feel comfortable acting as the primary point of contact between the EHR vendor and the rest of the practice, ensuring that training is delivered effectively and efficiently to each member of the team.

Influential and Respected

EHR implementation is a matter of crucial importance, so it’s vital to have the support of every member of your team. The right EHR champion will be someone who is respected and admired by your entire staff. They should be known for their enthusiasm and their proactive, forward-thinking outlook. Your champion needs to enthusiastically promote the benefits of transitioning to an EHR and will serve as a role model of sorts for everyone else. When your staff members see how eager your champion is to get the new system in place, they’ll be far more likely to support the process too.

Willing to Build a Team of Leaders

Unless you have a very small practice, your EHR champion should also be willing and able to assemble a team of leaders who can provide support to members of their own teams or departments. For example, your champion might select leaders from HR, the front desk, the nursing team and so on. That way, no one gets lost in the shuffle, as every person’s needs and concerns are addressed more effectively.

Making Your Choice

Now that you’ve familiarized yourself with the top characteristics of an ideal EHR champion, you probably already have at least one or two people in mind for the role. If you don’t, sit down and give the matter some careful consideration; there’s bound to be at least one person capable of being your EHR champion.

At any rate, you certainly shouldn’t initiate the implementation process without identifying them. In fact, you should have one in place well before implementation begins in order to build support for the transition among staff members. With everyone behind the process and actively involved in it, the change is sure to go off without a hitch.

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Final Thoughts

Implementing an EHR system is not a process to be trifled with. But when it’s done right, there’s no shortage of benefits to be had. As long as you understand the costs, plan accordingly and promote a diligent EHR implementation champion, the process will get done without an error. And once it’s up and running, you’ll ask yourself why you didn’t implement one sooner.

Still have any questions or concerns about the cost of implementing an EHR? How has your health organization benefited from the adoption of electronic health records? What were your biggest financial challenges in doing so? Let us know in the comment section.

Jason KellerEHR Implementation Cost Breakdown: Logistics of EHR Implementation Costs

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