Credit: Tim Martin | Dreamstime.comHealth care only got two
mentions in President Obama’s
first inaugural address: One was a declaration that “our health
care is too costly,” the other was a promise to “wield technology’s
wonders to raise health care’s quality and lower its costs.”

A few weeks after giving the speech, Obama would follow through
on the promise by signing the American Recovery and Reinvestment
Act—the $833 billion law commonly known as the stimulus.  The
stimulus included about $20 billion in funding for incentives
designed to spur the adoption of electronic health records.

The hope was that converting the nation’s health records to
electronic systems would make health care cheaper and more
efficient. Analysts at the RAND Corporation
estimated that adoption of the new computerized systems could
save about $80 billion over a decade. Similar studies concluded
that not only would adoption of the new systems result in savings,
they would promote health by enabling better preventive care and
chronic disease management.

But four years later, the projected benefits have failed to
materialize. Earlier this year, RAND researchers
released a follow up study
concluding that the savings just aren’t there.

One big problem: Small practices, older practitioners, and
specialists have been slow
to adopt the systems, despite the existence of taxpayer-backed
incentive payments of up to $44,000. Simply installing those
systems—which can be quite expensive, costing even more than the
incentive itself—isn’t actually enough. In order to get the
incentive payment, providers must meet “meaningful use” standards.
And according
to the New England Journal of Medicine, fewer than 10 percent of
specialists and 18 percent of primary care providers were using the
technology well enough to get the federal bonuses.

Another problem is that a lot of doctors don’t seem to
particularly like the new systems. Among the doctors who are using
new records technology, many complain that it actually
slows them down or makes it harder to interact effectively with
patients because they’re stuck typing on keyboards and staring at
computer screens.

Interoperability, or rather the lack of it, is also a big
problem—and perhaps the biggest snafu of all.

Photo credit: The Doctr / Foter.com / CC BY-NC-NDThe systems were supposed to
produce digital records that could be shared across providers and
move with patients as easily as email. But RAND’s follow up
study
states flatly that “the health IT systems that currently dominate
the market are not designed to talk to each other. A big part of
the issue is that IT vendors have sold providers systems designed
to lock them into business with a single vendor, not easily
communicate with records created and maintained on other systems.
RAND’s study likens the current system to frequent flier cards
usable only with a single company rather than ATM cards usable
anywhere.

You can imagine a number of reasons why this might have
happened: The stimulus was passed fairly quickly, so mandatory
interoperability slipped through the cracks; hospitals and other
health providers each bought and managed their own systems rather
than attempting to coordinate; doctors are independent operators
focused on health more than on technology and administrative
efficiency.

But why it happened is in some ways less important that the
simple fact that it did. We blew a sizable chunk of taxpayer money
on getting providers to install these systems, and we’re not seeing
the results we were promised. In fact, if anything, we’re seeing
the opposite: The new systems actually appear to help doctors bill

better navigate Medicare’s complex billing system, making it
easier for them to charge the federal government more.

This is why I’m so skeptical of Obama’s more recent promises to
control Medicare spending through “modest reforms” that tweak
incentives and payment systems. We’ve been trying modest reforms
for a while. And in many cases they just don’t work.

(Thanks to Aaron Caroll for
pointing out the NEJM letter.)