Arnold Kling  

Why No Electronic Medical Records?

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Ezra Klein writes,

To this day, I've never read a compelling explanation of why the nation's doctors and hospitals haven't broadly adopted electronic medical records.

Has he not read my explanation, or does he not think it compelling? In case it is the former, let me state it.

I spent much of my career in business, and much of my focus was on use of information technology (IT). Among the lessons I learned were.

1. Within a company, every business area gets the IT it deserves. Chaotic, haphazard business areas get lousy IT (and blame the IT department). Organized, well-run business areas get great IT.

2. Data cannot be maintained unless there is clarity of ownership. It must be clear who is responsible for creating, maintaining, updating, and deleting the data.

Our health care system is highly fragmented. It is chaotic and haphazard, particularly when compared to a system of managed care or a government-run health care system (the latter being managed care carried to an extreme).

There are pros and cons of managed care. One of the cons is that Americans hate it--we would much rather be able to self-refer to a specialist rather than have to go through a managed-care process. Managed care can be difficult to reconcile with our preference for physician autonomy.

But one of the pros is that managed care is likely to use IT better. I am told that both the Veterans' Administration and Kaiser Permanente are way ahead of the rest of the U.S. in their use of electronic medical records.

Without managed care, there is no clear owner of individual health records. With my checking account, my bank owns the data. They are responsible for creating, updating, deleting, and so on.

It does not work to have my personal computer be the definitive source of my checking account data--I am not reliable enough a manager of this data. Similarly, the individual is not a reliable enough data manager to own his or her own electronic medical records. But there is no one else in the process in a position to own those records, either. My doctor does not always know when I self-refer to a specialist. Even if I do not self-refer, the specialist does not have direct access to the primary doctor's data records.

We could fix the existing system to create a definitive data owner. We could require each person to designate a primary physician, who in turn is the owner of that person's medical records. However, I think it would be very difficult for the primary physician to manage these records in a secure manner when other providers get involved. If I am the primary care provider and you are a specialist, how does my system know which part of the medical records you are allowed to read and which part is confidential with respect to you? How does my system know which part of the records you can edit and update, and which part are "read-only" from your perspective?

These are tough issues. Again, I have a hard time seeing how they get resolved outside of a managed-care context.

In conclusion, don't think that electronic medical records represent a mere technical challenge. They are part of a business process. As long as Americans prefer a fragmented health care process to a managed-care process, electronic medical records are unlikely to prove to be a panacea.

I would like the market to decide between managed care and fragmentation. I think that in a free market, more people would choose managed care, in part because of the cost advantages it enjoys, including greater ability to use electronic medical records. But the same employer-provided health benefits system that insulates consumers from the cost of health insurance also insulates them from the savings of managed care. If you as a consumer are not going to enjoy much of the savings from managed care, then you might as well indulge your preference for greater autonomy for yourself and your doctor.

As I've said before, the original sin in American health care is employer-provided health insurance.

Comments and Sharing

COMMENTS (16 to date)
aaron writes:

Loss of control is the simple answer.

It's just hard to trust the electronic system to deliver consistantly. How often do we have deal with systems being updated, reversion to default settings, backups writing over or being accessed rather than current files... especially working in a government environment.

caveat bettor writes:

Doctors and Lawyers (with some technology competent exceptions, like patent lawyers or laproscopic physicians) are pretty horrible business people, at least compared to information technology professionals, and then financial services workers.

It's hard enough for a bank to pay for strategic technology initiatives. Why would a hospital or law firm want to do that, when they see the cost but not so much the competitive benefit.

And speaking of competition, when you are getting paid by the government monopoly (Medicare, justice system), you are operating in a distorted market.

David Thomson writes:

"As I've said before, the original sin in American health care is employer-provided health insurance."

It is so sad to see so many supposedly educated adults who believe the employer pays for their health care. The brutal truth is that the cost of the coverage is deducted from their total pay package. Their boss literally does not give them a single penny. I am utterly convinced that this fantasy must be demolished before Americans can even begin to talk sensibly about health insurance.

Josh Adams writes:

> These are tough issues. Again, I have a hard time seeing how they get resolved outside of a managed-care context.

Really? You can't imagine a few companies coming into existence specifically to fill that role? Just allow me tight-grained control over an electronic version of my medical records, with the ability to easily grant permissions to various doctors? Something like a Flickr API for medical records. I think with a good interface, it'd be great. Pie way out in the sky though...

Kevin Brancato writes:

I've been member of Kaiser Permanente (DC region) since 2000. For the past two years, all my visit records have been computerized. This means my doctors type in their observations into secure terminals located in all visit offices. Thankfully, all my KP doctors can access detailed versions of all my previous visit records with other doctors -- which actually stopped one of my doctors from performing a biopsy in the wrong location.

For medical advice, doctors and nurses print out sheets for me to take home. However, I can access on the internet slightly less detailed information than the internal doctor system -- all vitals, patient and follow-up instructions, as well as a list of the tests taken for all visits to KP since 2005.

Test results are now supposed to be available on the web, but I've been healthy and not had tests performed in a year, so I cannot verify. Of course, these records cannot include care I obtain outside the KP system -- such as flu shots.

However, I don't have access to images of x-rays and the like on the web, and don't know how far digital imaging is being integrated into the internal KP system.

DrObviousSo writes:

I don't see why there can't be record storage companies that do what KP does.

(This is just a guess, I'm merely a poor college student)Don't we let our personal bankers have access to our bank accounts and investments etc? Why can't we do the same thing with a medical records advisor. When we go to any doctors office, we just specify a URL, email address, fax number, or mailing address to send all the records generated to. The advisor can, like suggested above, provide online access to any documents that a current provider needs.

mkim writes:

EMR goes to the Dr's offices that are big enough to really make sense of the upfront costs. If you can split the cost of a server space and similiar hardware it becomes cheaper and cheaper - I feel the only thing keeping EMR from being real implemented are the older doctors stuck in their ways.

Also a big office gets to share the cost of a support team - EMR team and an IT team.

TECH SAVY Dr's are most likely going to join a medical group - to sort of pay membership to get the services - if they can't flat out pay for themselves.

but i think the majority of Dr's office are well established pridefull old ppl that are wanting to retire before they have to learn something.

I predict that around the time we figure out Social security is when we will se widespread EMR

Michael Stack writes:

I too am a member of Kaiser (in Ohio). It's pretty amazing how efficiently everything is run. You can call for an appointment, and typically are seen the same day. The doctors, many specialists, labs, and pharmacies are all there - nearly everything is done in one building.

When first you become a customer of Kaiser, they have you come in for blood work to check for things like diabetes, which are much more cheaply treated the earlier they're detected.

When you see the physician, both the nurses and doctors spend most of their time in front of a terminal, updating your patient record. I believe that depending on what they enter, they're prompted to ask you questions, but I'm not sure about that.

The pharmacy inside the building receives your prescription electronically just as soon as the doctor prescribes it. There is a big board listing the names of patients, highlighted when their medication is ready. Since the prescription is sent automatically, often before the end of your doctor visit, it is not uncommon to find your medication waiting for you when you walk to the pharmacy.

When visiting Kaiser, one is left with the distinct impression of being on a medical assembly line. Unlike most people, I find that very comforting.

I can't recommend Kaiser highly enough.

William Newman writes:

Arnold Kling writes "As I've said before, the original sin in American health care is employer-provided health insurance."

I still have trouble seeing that that's obviously a bigger deal than government-imposed barriers to entry, which as near as I can see weren't even a case of "regulatory capture" but were owned by the existing practitioners from day one.

Of course I can see that health care has especially pressing reasons for controlling quality, and so to the extent that central control and prior restraint are The One True Way to safety, barriers to entry are a no-brainer. However, to what extent is that? I am old enough to remember people arguing incessantly that free markets perversely wouldn't, essentially couldn't, bring us reliable cars. Does anyone want to argue today that highly-regulated mandated improvements in auto safety gear have been dramatically bigger than the much-less-regulated competitive improvements in auto reliability? Or hold up NASA or some such thing as their favored example of safety and reliability?

Josh writes:


Your checking account analogy got me thinking - how do your thoughts on why we don't have medical records compare to say, ABA routing numbers or ATM machines? How come I can go to any one of 10s (100s?) of thousands of ATM machines world-wide and have access to money from my little local bank, but I can't have access to my medical records? There is no "managed care" (or certainly no government support) for interbank ATM networks and yet they all seem to play together.

I think the reason we don't have computerized medical records is actually much simpler than you say: there's no market for it. First off, most people don't see an advantage to having their records computerized and so they would be unwilling to pay for the service (the way they "happily" pay fees to banks for ATMs and other services). Thus, there's no incentive for a PLUS or Cirrus type company to come along and setup an inter-doctor network of records. And second, as you say, employer-provided health care ensures that no one in the medical community competes for customer satisfaction in this country anyway (which means I might be wrong about the first issue).

Matt writes:

How about the credit bureaus? They collect information from multiple sources on a single individual. They made a business out of it. It doesn't seem like medical records are that different, the privacy problems notwithstanding.

Robin Hanson writes:

Great comments Arnold - they have the ring of truth.

Tom writes:

I guess no one here has heard of "MyMedicalRecords.Com". It's a new business that allows an individual to store their medical records online in their own account behind a secure firewall. Because of a new law, your doctor is required to provide you with one copy of all your medical records. You can request to have them faxed into your account and voila' your medical records are at your command! And anyone you choose to give access to can see them as well. Or, you can fax them to your new doctor or any specialist you are going to see. This includes x-rays and your latest test results.

And "No" I do not work for But I do have an account with them.

P.S. You can also store non-medical information in your account as well, including your will, life insurance information, birth certificates, etc.

B. England writes:

I think the biggest reason we have not seen EMR's adopted is a productivity issue. For all it's flaws, paper charting is a highly evolved shorthand method of rapidly tracking information. Primary care medicine involves documenting a quite diverse range of information that has not lent itself well to standard inputs. If a 15 minute visit becomes 20 minutes of blundering through software, I'm now paid for 3 visits instead of 4.

Poorly designed software is far worse than no software at all. I've not been overly impressed with either speed or ease of use of any system thus far, though I do think they are steadily improving.

Larger organizations would benefit more from other aspects of EMR's (such as transfer of information) and are more likely to be early adapters. Individual practitioners and small groups will be more financially driven.

bingo writes:


Why no EMR? It's quite simple, really. There is little to no ROI on an EMR, at least in the short and intermediate terms. In addition, most EMR's reduce office efficiency (as mentioned by B. England) and while doing so become a barrier between the physician and patient. The answer to "Why no EMR" is cost, pure and simple.

A better question might be "Why an EMR?" Mkim writes that the barrier to EMR is prideful old docs who won't learn a new way, but that simply doesn't jive with how "old docs" practice medicine, continually learning and implementing new treatments and care over a practice lifetime. EMR allows everyone in the chain of care to have the same information at the same time; it allows for safety prompts, alerting caregivers to possible dangerous situations; it fosters continuity of care, allowing the primary care doctor to keep a finger on the pulse of complex care provided by multiple specialists; it provides a record of what's already been done, reducing redundant care.

But the REAL reason to have EMR is to create a transparent medical marketplace where each consumer of medical services is capable of seeing information that will allow them to make an informed purchase based on quality as well as price--value. Does anyone doubt that a surgeon with 15 years of experience will obtain better results more safely and more efficiently more often than a surgeon with 15 weeks of experience? And yet we have no way of knowing that, do we? A universal, standard, national EMR would allow a true accounting of outcomes, creating a marketplace that is as transparent as the automobile marketplace.

A true EMR is a tool of commerce; it is the "highway" of medical commerce. As such this is the appropriate place for government to be involved in the economics of health care--not in the purchase of healthcare but in creating the infrastructure for the market. Just like our interstate highway system provides an infrastructure for interstate commerce. If the federal government declares the standard and builds the highway, the major barrier to EMR is removed.

We have a rudimentary EMR in our business. We have not moved to EMR 2.0 due to cost. We KNOW it will improve all parameters of care and patient experience, and yet we cannot afford it. Simple as that...

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