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Saturday, June 8, 2013
Electronic Health Records: Monopoly 'Scare tactics' Driving Hawaii Doctors into Retirement
By Jose Reque Martinez @ 7:05 PM :: 8838 Views :: Health Care, Small Business

Electronic Health Records: Monopoly 'Scare tactics' Driving Hawaii Doctors into Retirement

by Jose Reque Martinez

Hundreds of Hawaii physicians are projected to retire rather than comply with Healthcare Reform mandates requiring use of expensive and sometimes cumbersome Electronic Health Records (EHR) systems. But one EHR vendor believes the system has been made artificially difficult and industry sales force scare tactics may be contributing to the medical exodus. 

Interviewed under condition of anonymity, the CEO of a local Hawaii medical billing company explains how mainland EHR competitors pressure doctors into buying expensive products he says they don’t need.  Meanwhile existing EHR vendors are kept on the sidelines waiting for the 'certification' needed to continue to provide EHR services to their existing clients.  Nationally, hundreds of local medical billing services are being indirectly squeezed out due to new EHR’s coming prepackaged with billing software.  Doctors are being pressured to pay tens of thousands of dollars and reorganize their practices rather than simply upgrading at no charge through their existing software vendors.

The Honolulu Star-Advertiser, in an April 21 editorial, writes: "What's accelerating the flight from practice now is concern that, under the ACA rules, doctors who haven't converted to electronic medical and prescription records will face penalties." Presentations to the April 20, 2013 Hawaii Health Workforce Summit projected the loss of 750 doctors by 2020, increasing Hawaii's physician shortfall to 1,500.

Under the Patient Protection and Affordable Care Act (ACA), also known as 'Obamacare', all doctors will be required to use 'certified' Electronic Health Records systems in their practices or face reduced Medicare and Medicaid remuneration. Until 2009, only one organization, CCHIT, a non-profit controlled by industry insiders, was licensed by the Office of the National Coordinator for Health Information Technology to perform pre-certification of so-called "home grown" EHR systems nationwide.

The three stage CCHIT certification process for EHRs costs more than $36,000 plus fees for additional software modules.  This figure is challenging for the small EHR providers whose clientele consists predominantly of physicians in private practice.  Similar challenges face small hospitals and medical practices seeking to 'certify' their legacy software.  Dr Robert Rowley MD, a developer of EHR systems, knocks CCHIT for "a progressively-expanding set of criteria (around 500 line items) that had been criticized by numerous observers as being too feature-focused and centered around large, legacy, fully-integrated client/server systems which was the forefront of software development in the 1990s."

Starting in 2009, large vendors including Dell, General Electric, Microsoft, and Siemens  received 'Stimulus' money to fund development of EHR systems and quickly became certified to sell their proprietary software nationwide at prices tuned to match federal incentive payments to doctors.  Meanwhile, many small, local EHR vendors have had to change marketing tactics to keep up with new competition.

According to, rules for 'Stage Two' of the complex three-stage EHR certification process will not be published until 2014.  'Stage Three' rules are not due to be published until 2016.  This maximizes the disruption of physician practices by creating greater uncertainty for those considering retention of their existing vendor or software.

Physicians are mandated to use EHR systems or face reduced Medicare and Medicaid reimbursements starting in 2015. Those who adopt EHR systems and find them falling short of the as-yet unpublished 'Stage Three' rules will be dinged just as surely as MDs who made no effort at all to adopt EHRs. In order to steer physicians toward large proprietary EHR software vendors, the Center for Medicare and Medicaid services offered a maximum $44,000 Medicare incentive to physicians who adopt EHR systems by 2012. A $63,750 maximum Medicaid incentive is became available starting in 2012.  These payments are limited to 75% of Medicare or Medicaid billing amounts spread over four years. Physicians who limit Medicare or Medicaid patients are effectively excluded from the incentive program.

Many doctors in Hawaii either outsource their billing to local companies, or do their billing in house. Some EHR products were packaged and sold with billing software to inflate software prices.  Dr Steven E. Waldren of the American Academy of Family Physicians argues that EHR systems offer "a lot of complexity that doesn't need to be there."

According to our source, EHR salesmen told physicians they could drop their local medical billing company or employee and replace him or her with the built-in EHR billing software. After laying off employees or ending service contracts, doctors soon realized the new billing software required employees or vendors to maintain and operate and the new system ended up being more expensive than the old billing services.

For private practice physicians nearing retirement, the massive and expensive changes seem daunting and pointless. Why accept an expensive and disruptive multi-year churning of medical practice business systems if one is planning to retire soon?

Expensive, complex, proprietary EHR systems are pushing younger physicians to become employees of hospitals or health systems and pushing older private practice physicians to retire early.  The result will be less independent medical advice available to individual patients.  Physician-employees will struggle to provide medical care not constrained by their employer's need for corporate profits.



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