101 Tips for purchsing your EMR: 59-40 Finance Tips
Posted Jul 14 2010 2:41pm
Whether we like it or not, EMRs have a huge financial impact on the clinical market. They are expensive, and come with huge upkeep and change costs. We have been mandated to move to 5010 (HIPAA 2.0) and ICD-10, which are huge financial impacts on the EMR. We make decisions about clinical service lines and strategic planning for our future based on the finances of our business. Managing your costs associated to the EMR can be very difficult. Here are a few tips to help you keep your costs down.
101 tips for purchasing an EMR is just a scratch of the surface. Purchasing a new EMR can be very complicated and will have a long lasting effect on the service, quality, safety, efficiency, and finances of your practice. This table shows you the first segment of tips and questions to think about when you engage an EMR vendor.
The 101 tips are broken down into Support, Quality, Safety, Finance, and Efficiency. Some questions will have more or less relevance to your practice based on the size and electronic maturity of your environment.
Tip / Questions
Are the meaningful use (MU) guidelines covered by your product?
Every vendor will talk MU these days. Just remember that MU has 5 phases and each phase requires different aspects to be ready. Few vendors are actually prepared for the entire program yet, especially on CPOE and CCHIT aspects.
It they aren't CCHIT certified take a really really hard look
I might even say dump them if they aren't CCHIT certified, (because if they aren't, you can't get MU dollars), BUT.... several vendors are releasing new versions of their applications that aren't certified yet. If they last few versions were certified, you should be ok. The other consideration is that the final rules aren't out yet on MU. CCHIT just may get pushed back a phase or two, thus giving you more time.
What billing systems do you interface with?
Your overall finance processes will be much easier if you can interface the EMR to your billing systems. Make sure that your is on the list of previously interfaced applications. If not, negotiate better prices, or take a much closer look at adopting that specific product.
How much do changes and customizations cost?
Nearly every medical facility will need changes or customizations. First you need to be sure you can make changes to the system. Second, make certain you know how much they cost AND how long it takes to deliver them. Don't let the vendor give you the 'ol switcharoo' with a charge to make a custom and then the "it will be there in the next version"
Discover how easy it is to interface to the EMR.
Easy interfacing is key to expandability and keeping costs lower while still giving your clinical staff flexibility in their third-party products. If nothing else, make sure an "interface engine" is available. Given the cost to program interfaces, you will often be $100K+ ahead to use an interface engine.
Make sure to understand the licensing model
Licensing can be very tricky. Often licensing in health care is done "per physician" or "per bed". However, there are often side costs for interfaces or different components of the system that will change your costs unexpectedly. Keep the same thought in your mind when asking what the annual maintenance costs will be.
Does your product handle billing?
Slightly different than #57, this question asks if the EMR itself can handle the billing functions. You can lower your overall costs if you can integrate billing into the EMR rather than having a separate product for that function.
How is licensing managed?
This is similar to #54, but still a different angle on licensing. Licensing is best managed if you can use a "just in time" license model. In other words, you buy licenses when you actually need them. Many EMR vendors will attempt to charge you for blocks of licenses or for what you "will have" for usage. Doing that just takes money out of your pocket ahead of time. Once in a great while it is a good idea if you can get large bulk licenses for cheap, but most of the time it just ends up costing you too much too soon.
Make certain you know what upgrades for license expansions cost
If you have a growing practice that is looking at new service lines, you will want to know about the EMR vendor's expansion costs. For instance, if you are going to add a sleep clinic you will need to know how much the sleep clinic application within the EMR will cost and how it will integrate. If the expansion doesn't integrate, then your staff will spend more time developing interfaces, or typing in redundant information. This can be a very expensive mistake if you don't explore it upfront.
Determine how complete the financial reporting is
Now, remember we are talking about your clinical systems. That being said, you will have different types of financial reports that you will need. Charge capture and diagnosis codes are some that immediately come to mind. Make certain to look through the standard reports that come with the system. If you don't see what you want, you will need to pay someone to build them. That cost can be considerably more than you would expect. Try to plan for reporting costs up front.
Take a close look at financing your EHR vs. paying straight cash for it
This is the same discussion you will have about any piece of large medical equipment. Should we capitalize? Should we finance? The twist with an EMR is that it is software, and capitlizing and depreciating software can be a challenge. Additionally, if you are in a long partnership with the EMR vendor, you may have better leverage with them by changing your financing model. Just make sure you don't get overcharged in interest or fees.
Plan for a rollout gap
What is a "rollout gap"? It is the time after the initial deployment of the product that you lose productivity. The loss of productivity is unavoidable. You are changing the way clinicians practice medicine, changing the way you bill, changing the way you register, and often changing the overall patient experience. A rollout gap is unavoidable, but you can plan for it. You can study other institutions your size and determine an estimate to the time and depth of the gap. This is an item you will certainly want to research. There are many strategies to take into account. The first you will want to look at is "big bang" vs. "tidal wave" deployment methods.
Plan for staffing surges
You will have to plan for staffing surges at different points in your EMR deployment. If you go with a big bang deployment you will have a large surge at go-live and within the few weeks after wards. If you do a tidal wave go live you will have smaller but continuous surges with the training teams and clinical staff.
Know where your charges flow
Knowing how charges flow in the system seems like a no-brainer, but it tends to be much harder than people realize. Make certain you know how charge codes are being captured, by whom, and where they are going.
Think about ICD-10 compliance sooner than later
ICD-10 is currently scheduled to be enacted on October 1, 2013. I know this is three years away, but it isn't nearly as far as you think. Many medical systems are projecting 12-18 month transition periods to get ready. Don't underestimate the size of this project.
Make sure your revenue cycle process is as clean as possible
DRO will often suffer when bringing up an EMR. You will want to evaluate your entire revenue cycle process from end to end.
Don't underestimate the time necessary to be compliant with 5010
5010 is the same problem as ICD-10, but it shouldn't have as much of an effect on your physician groups. January 1, 2012 is the date for the 5010 legislation.
Keep transcription in mind
Don't forget your HIM teams and transcription. Transcription is a considerable cost in most organizations. Your EMR should offer considerable options to lowering those costs. Speech recognition and speech to text systems should be able to be integrated into the EMR. These systems will lower your overall transcription and HIM costs if used properly.
Watch your insurance claim denials
Finance folks will usually do this anyway, but it is extra important after going live with an EMR. You need to ensure that electronic claims work as expected. If you don't, you won't get paid.
Do NOT let the finance department drive the EMR choice or deployment
If I were to nominate the most important tip in the Finance area, this would be it. The finance areas must be at the table when looking at new EMRs. However, they should not lead the project. The project needs to be lead by the clinical teams. If finance drives, you will miss process enhancements and create strife and inefficiency for the clinical staff.