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EMR Implementation & HITECH Act Blog

A blog for doctors and medical office staff seeking assistance with EMR and the HITECH Act.

03/22
2010

Financing of EMRs Carries Both Risks and Rewards

Physicians looking to adopt Electronic Health Records (EHRs) are facing an interesting dilemma.† Incentive money won’t be available from the government for the the implementation of EHRs until 2011, but implementation will require spending substantial amounts of money now ñ as much as $25,000 to $50,000 per provider, by some estimates ñ to get the system up and running and qualify for those incentives.

The decision many of you are doubtless facing is whether or not to take advantage of the financing programs being offered by many vendors.† To encourage you to buy their systems, many are offering low or no interest loans to bridge the gap between when you have to pay and when incentive payments become available.† They are also promising that the programs you buy will ultimately be or remain certified.

The financing may be through their own finance operations, or through third party vendors.† General Electric, for example, offers the Stimulus Simplicity financing program, which offers zero-interest payments until stimulus incentive moneys become available.

Be careful before entering into any kind of financing program, not just because it is always prudent to do so, but because once installed, the system you finance will hold the lifeblood of your practice ñ your records.† What happens in the event of a dispute or disagreement with your vendor?† Since with most financing agreements, the vendor owns or has a significant financial interest in the equipment until you have paid it off, are you effectively giving them control over the data that exists on your system?

Once your EMR is up and running, you still have to demonstrate meaningful use on a certified Electronic Medical Record system before the government will write that incentive check.† So what happens if after three or six months or a year you are unhappy with the system you implement?† Will financing limit your options if the software fails to meet your expectations for usability or suitability to your practice, or if the vendor fails to achieve certification?

In some cases, according to a recent article in ModernHealthcare.com you may find your options limited by your financing agreement.† In most cases, the financing company has an interest in leased equipment, so, for example, if you were to stop payments until a dispute is resolved, the finance company may be able to come in and haul your equipment away ñ with all your data.

According to the article, dispute resolution should be agreed upon by all parties as part of the financing agreement.† There have been cases where a finance company has literally held data hostage until their requirements were met.† And if you opt for EMR software as a hosted service, you are just as vulnerable ñ they can simply lock you out of your own system until you pay.

The finance companies, while saying that they try to work things out first, don’t deny that they can repossess an EMR system.† ìWe have that right, ultimately, if they didn’t pay and there was no resolution to the dispute,î said Jim Ambrose, president of health care financial services, equipment and finance for GE Capital, the division of General Electric Co. that offers the financing for GE Healthcare systems. † Several other vendors interviewed in that story confirmed they have a legal right to repossession in cases of nonpayment.

Try to keep your financing linked to your equipment or software supplier, suggests Steven Waldren, director of the American Academy of Family Physicians’ Center for Health Information Technology.† ìOnce the vendor got paid, the incentive to find a solution was less.† They had no obligation to make sure the software really worked.î

The industry consensus is that financing health care IT is a lot liking financing a car, in that they won’t change the rules for you just because you aren’t happy with what you bought. † Do everything you possibly can before you finance an EMR system to protect yourself down the road.

Rich Silverman
PCHS Blogging Team

Public Domain Image by U.S. Treasury Department courtesy of Wikimedia Commons