Dr. David Brailer and Electronic Medical Records: Perhaps the Chairman Doth Protest Too Much

Dr. David J. Brailer, appointed by President Bush in 2004 as the first National Coordinator for Health Information Technology, has written an article for Health Affairs worth reading. Dr. Brailer notes that President-elect Obama “has pledged $50 billion to bring health information tools into widespread use (which is $49,950,000 more than President Bush gave me to spend).” (Note: as the present budget for the office of National Coordinator is a little more than $66 million, I believe Dr. Brailer meant to say that the budget during his tenure was roughly $50 million, which would make Obama’s $50 billion $49,950,000,000 more. Apparently, I’m not the only one confused by billions).

Having said that, Dr. Brailer has some suggestions worth noting, not the least of which is that ensuring structural compatibility and integration of data systems are paramount necessities which will require more than just “hiring the geek squad.” He states

Setting up an electronic health record is a complex task, requiring data integration, clinical algorithms and complex software customization. Likewise, helping physicians and other health care workers learn to work with electronic tools is more than point-and-click training. Electronic health records change the very nature of health care work – clinical decision-making, communications, documentation and learning. Our national transition to digital medicine requires a large supply of specialists – upwards of 50,000 people, including physicians, nurses and pharmacists – who understand both clinical medicine and information technology. It takes years to train these people, and they are already in short supply, so now is the time to start.

I have no contention with the assertion that “setting up an electronic health record is a complex task,” and surely, at the end of a $50 billion investment no one wants to look up to see a Med e-record Tower of Babel. But Dr. Brailer’s assertion that “helping physicians and other health care workers learn to work with electronic tools is more than point-and-click training” is somewhat at odds with recent articles in The NY Times, one of which shows what an electronic medical record looks like and explains how pertinent and potentially life saving information “is just a few clicks away.”

Dr. Brailer also states that we need to address what he characterizes as

the growing chasm between the physicians and hospitals that have electronic records and those that do not. Most large and urban hospitals as well as larger physician practices are far along in using electronic health records. Rural hospitals, nursing homes and small physician practices lag far behind. They face many barriers, but foremost among them is the lack of capital to purchase and implement information tools.

Dr. Brailer states that “Sales pipelines and hospital and physician budgets show that electronic health record purchases have slowed, indicating that the market wave has gone as far as it can. Now is the time for government incentives to help along those who do not have these systems.”

But Brailer wants to incentivize the “use” of electronic medical records much in the way that Congress has done so regarding “electronic prescribing.” He states: “Medicare pays physicians a 2% bonus for using eprescribing on appropriate patients starting in 2009, and this incentive converts to a 3% penalty for those who do not eprescribe in 2013.”

Of course, Brailer is right to make the distinction between "purchase" and "use." No one wants to subsidize a high tech, dust gathering coat rack. He makes the point that “We should not incent physicians and hospitals simply to purchase electronic records. We get no benefit when a physician or hospital buys an electronic record. What we should do is reward the use of these tools as part of a patient’s care.”

What he fails to address, however, in this incremental ROI “pay for use” approach is what he characterizes as the “foremost barrier” to those “Rural hospitals, nursing homes and small physician practices” on the other side of e-med record chasm: initial capital outlay.

Considering the financial difficulties of many hospitals—and the chilled credit markets— it is somewhat difficult to envision how the gradual return on investment through “pay for use” will offer great affect for those medical service providers who, at present, have a “lack of capital to purchase and implement information tools.” It is not, however, hard to envision how such a continuous “pay for use” incentive would benefit those larger providers who have already implemented electronic medical record systems.

Additional payments each time they used what they have already invested in would, no doubt, provide an additional dividend which these typically larger providers would greatly appreciate. It is not at all clear, however, that such a program, requiring significant investments of capital—which may well not be available at this time—will lessen the “chasm” by any great measure.

The New York Times has reported that

For most doctors, who work in small practices, an investment in electronic health records looks simply like a cost for which they will not be reimbursed. That is why policy experts say any government financial incentives to use electronic records — matching grants or other subsidies — should be focused on practices with 10 or fewer doctors, which still account for three-fourths of all doctors in this country. Only about 17 percent of the nation’s physicians are using computerized patient records, according to a government-sponsored survey published in The New England Journal Of Medicine.

The Times also reports that those who are presently using electronic medical records tend to be part of larger health care organizations.

No longer the National Coordinator for Health Information Technology, Dr. Brailer is now the Chairman of Health Evolution Partners; it is a health care investment fund:

“Health Evolution Partners invests in the world’s leading health care companies. We seek out companies that are driving critical shifts in how health care is financed, organized and delivered.”

….We use these assets to help our portfolio companies:

• Build strategies with unusually high potential
• Navigate and mitigate business, policy and regulatory risks
• Develop and shape the market for their products and services
• Enhance the growth and returns for their shareholders