Yet another look at the article on Electronic Health Record
implementation from the New England Journal of Medicine. It presents a survey
of nearly 3000 physicians in outpatient medical practices nationwide. The results showed that just 4% had extensive
electronic records systems in their practices, and 13% had basic systems. The
survey asked respondents to identify the barriers to moving from paper to
an electronic health record. The second most frequent response after cost was
uncertainty about return on investment (ROI).
ROI is a commonly used
formula-based numeric measure, but it is not as straightforward as one might
think. Sure maybe you can project a definite positive ROI before the fact. The
EHR implementation I managed at UBHC was in the black after the first two years
thanks to bringing all billing in-house and discontinuing all transcription
services. But such initial cost-saving opportunities may not be available to
your organization. Your situation may be unclear. Time to pause and think about
the place of ROI in IT decision-making.
Using ROI as a factor in
decisions about an EHR is problematic. As Craig Symons states in his monograph
“Measuring the Business Value of IT Investment,” purely financial measures such as ROI
imply a precision that does not exist. He describes that the calculations used
in the measures are based on estimates of benefit, which in turn are based on
assumptions. So the accuracy of the calculated ROI is only a good as the
underlying assumptions. He presents other shortcomings of purely financial measures,
which I’ll touch on soon.
Symons presents several
alternative approaches to evaluating IT projects. Have a look.
