NC State Economist Dr. Mike Walden – The Cost of Electronic Medical Records

A long-standing recommendation for improving our health-care system and reducing costs has been to computerize paper medical records. This could save money by reducing storage space and increase efficiency by facilitating the sharing of that information by health-care professionals. But is there any evidence such outcomes actually occur? N.C. State University economist Mike Walden answers.

“Well, this is a very interesting question …, because we’ve heard this recommendation now for several years. The new health-care act actually stimulates or encourages this kind of transition from paper to medical records. Now, we finally have a study out that has looked at this issue and … asks questions: Well, does this really save the money that people are claiming?

“And, as you might expect … with a lot of studies, the results are mixed. The first finding is that if you do go from paper to digital medical records, what the study found is that actually (you see) increased costs for doctors and hospitals. So initially the costs go up, and you might expect that’s because it takes time and resources to transfer these records. And a lot of these records have to be hand key-punched in.

“Secondly, however, the study found that after three years – they looked at a three-year window – hospitals in particular that had been using information technology extensively, they already were used to using IT equipment and programs. They actually saw their costs go down. However, hospitals (that) had not made in the past a significant investment in IT – information technology – and they had to be brought up to speed so to speak, they actually continue to see their costs go up when they did digitize their medical records.

“So, I think the bottom line here with a lot of things is it depends on your experience. If you’re a hospital that’s used to working with digital records and you transfer the paper to digital, yeah, you’ll pay a little more up front but you’re going to save down the road. Other hospitals are going to take longer to save the money.”


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