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Thursday, April 24th, 2014

IT and business management and issues

Additional security fails to cut healthcare costs

Researchers at Harvard University have uncovered what could be a confounding problem facing the healthcare industry: Digitalizing healthcare records and deploying new technologies fails to provide cost benefits.

For years, hardware and software vendors have been touting the return on investment (ROI) when enterprises, including healthcare facilities, streamline and eliminate inefficient, manual processes through technology deployments. But the new Harvard University research study shows that introducing technology into hospitals and doctor offices actually increases costs associated with configuration management, upgrading systems and deploying and maintaining healthcare IT security technologies.

"Most of the systems are being sold principally to make sure the institution collects every penny it can," said the report's lead author Dr. David Himmelstein, an associate professor at Harvard Medical School. "The guts of the system are distorted by the need to make sure it's a billing system at heart."

Himmelstein and his team reviewed about 4,000 hospitals from 2003 to 2007 and found that while many had digitialized patient records to eliminate paper, administrative costs actually rose, even among the most high-tech institutions. The hospital computing and costs study, published in The American Journal of Medicine, doesn't point to specific costs such as security and configuration management, but it does find that ongoing IT administrative costs add to the bottom line once new systems are deployed.

"Clearly there are some examples of quality of care being worse because of computers and some examples where it's been better. But overall they're not saving money," Himmelstein said in an interview with "Introducing technology has a trivial effect."