Excluded Voices

An interview with Jonathan Oberlander

This past year’s health discussion has been remarkable for the narrow range of ideas and opinions that have floated down to the man on the street. Journalists have sought out the same organizations and sources for their stories, offering up what has become the conventional wisdom for reform. To bring more voices into the conversation, our series, Excluded Voices, will intermittently feature health care experts who aren’t on the media’s A-list of sources. (The entire series is archived here.) We want to offer journalists more options for their stories and encourage a deeper conversation. To that end, we’ve asked the experts featured in each post to respond to questions from Campaign Desk readers.

In President Obama’s reformed health care world, information technology is the magic potion. It will reduce the cost of health care—which, in turn, will mean cheaper insurance premiums, allowing all Americans to have health coverage at some time in the future. Skeptics believe otherwise. Given the prominence of health IT in the administration’s line-up of health reform goals, it’s surprising how little coverage the media has given the topic. Last week there were signs of change. In his New York Times column, David Brooks took on IT and other cost control measures, noting that most experts don’t believe that these measures will “produce much in the way of cost savings over the next 10 years.” And a Washington Post story by Robert O’Harrow, Jr. examined how the IT industry stands to profit handsomely from the Obama initiative.

There’s a lot to report, so Campaign Desk talked to Jonathan Oberlander, a health policy expert and professor of social medicine and health policy & management at the University of North Carolina—Chapel Hill, to help journalists report the health IT story.

Trudy Lieberman: What do we mean by health IT?

Jonathan Oberlander: It generally refers to the use of computers in providing medical care. Electronic medical records—moving your paper health records into an electronic format—is a prime example.

TL: Are there differences in what is meant by an electronic medical record?

JO: Some electronic records just have descriptive information like diagnoses and what medications you’re taking. Others go beyond this and let doctors order prescriptions and lab tests electronically. Some can generate patient reminds for screening services and offer guidelines that help doctors diagnose and alert them to contraindications for drugs they’ve prescribed.

TL: When did interest in these systems take hold?

JO: It gained momentum in this decade. But in the last four years, it really picked up steam.

TL: To what extent are electronic medical records being used now?

JO: The New England Journal of Medicine has reported that about 17 percent of the doctors and 10 percent of hospitals are using them. And that means the basic kind of record, not the comprehensive variety.

TL: Why so few?

JO: Primarily the cost, which can be prohibitive for hospitals and small groups of doctors. Both are worried that it’s an investment that might not pay off. Systems can also be costly and difficult to maintain.

TL: How much does it cost to buy these systems?

JO: The Congressional Budget Office said that, in 2008, the cost for office-based record systems was between $25,000 and $45,000, but there are systems that are more expensive. For hospitals, we’re talking in the millions of dollars.

TL: Why are electronic records superior to paper ones?

JO: They are thought to be superior because they cut down on medical errors and allows doctors to do a better job. They allow doctors to manage care because they can track a patient’s progress, and they may also reduce the need for redundant, unnecessary tests that happen because paper records cannot be located. Electronic medical records can also generate data that help us identify what works and what doesn’t work in medicine.

TL: How will the stimulus package help move providers to adopt these records?

JO: It does it the old-fashioned way—by throwing money at the problem. If doctors and hospitals that participate in Medicare and Medicaid adopt “meaningful” information technology, they are eligible for bonus payments.

TL: What is meant by “meaningful”?

JO: We don’t know. The National Coordinator for Health Information Technology, David Blumenthal, will make that decision.

TL: How much will these payments be?

JO: Payments won’t start until 2011 and will range from about $40,000 to $65,000 for doctors. For hospitals, we’re talking about millions of dollars.

TL: What is the projected penetration of electronic medical records after the stimulus money takes effect?

JO: The Congressional Budget Office believes that we can reach 90 percent in a relatively short period. By 2019, we can get up to 90 percent for doctors and around 70 percent for hospitals.

TL: Who really benefits from all this money?

JO: The stimulus package calls for $19 billion to be spent over five years. The industries that make the technology and firms that consult with providers on how to use it will surely benefit.

TL: Won’t patients benefit too? Can you give some specifics?

JO: If electronic medical records improve patient care by reducing errors or other problems, then, yes, patients can benefit too. Health IT does have the potential to improve quality of care. Whether that potential will be realized is, however, a very different issue.

TL: Will all this money thrown at IT really reduce the rate of spending on health care, as some believe?

JO: No. Chances are it’s not going to save huge amounts of money.

TL: What do you mean by huge?

JO: The health care cake is very big. IT spending is not even the icing. We spend about $2.5 trillion on health care every year, and it would cost about $125 to 150 billion annually to pay for subsidies that enable all the uninsured to have health insurance. So $19 billion over five years is, comparatively speaking, not a lot of spending. The savings from this investment are likely to be a very small percentage of total health care bill. Health IT is not likely to substantially slow the growth of spending, though it still is worth doing as part of the effort to improve quality.

TL: Haven’t there been studies that show savings in some systems?

JO: There have been studies that show electronic medical records have saved money in the Kaiser Permanente and VA systems. But most American health insurance does not look like Kaiser or the VA. In fact, American health care is not a system. Promoting health IT here is harder than in countries that have single-payer systems, or in closed arrangements like Kaiser and the VA.

TL: How much would the federal government save in its health programs if IT were widely adopted?

JO: The Congressional Budget Office estimates that the HIT provisions of the stimulus legislation could reduce federal spending on health care benefits by about $13 billion over the next decade. But the program will cost about $32 billion to implement in Medicare and Medicaid, so spending on HIT will increase the deficit by $19 billion or so during that decade.

TL: Do other countries count on health IT to control health care expenditures?

JO: There is no evidence that other countries spend less because they use electronic medical records more than us (and they do). Countries that use electronic records controlled costs better long before there were such records.

TL: Why is this lack of evidence overlooked by politicians and, to some extent, the press?

JO: It’s an attractive solution for policy makers and politicians, so it has been overhyped.

TL: Why is it so attractive?

JO: Health IT sounds like a rational, sensible, and technical solution—and most important, it doesn’t appear to take on vested interests or stakeholders like health insurers. That makes it politically useful as a solution. It also promises to improve the quality of care, and politicians like solutions that both control costs and improve quality.

TL: Can you amplify this dual solution a bit more?

JO: Cost control involves pain. So if you have pleasure—in this case, meaning better quality—that means you can run for reelection on something positive. When you run for reelection, you don’t want to run on pain and lost income for constituents. When you’re doing something that sounds better, it’s a win-win.

TL: What cost control measures would result in greater savings?

JO: We could save money by setting budgetary targets for national health spending. For example, the Clinton administration proposed to cap increases in health insurance premiums. We could also create a system that let private and public insurers coordinate a national payment schedule for medical providers. That would help us restrain prices for medical care.

TL: Will America ever adopt these measures, or is medical inflation destined to relentlessly rise forever?

JO: As the saying goes, forever is a long time. If Congress adopts legislation that substantially increases insurance coverage—and there is a good chance that will happen this year—the incentives for the federal government to restrain spending will become stronger since the government will be spending lots of money to subsidize people to buy insurance.

TL: What will happen down the road when everyone realizes that health IT has not produced the promised savings?

JO: We will eventually discover that we can’t compute our way out of the health care cost problem. So the more important question is: What effect does health IT have on the quality of medical care? So far, the evidence that electronic medical records improve quality and outcomes is quite mixed.

TL: Can the systems in use today talk to one another?

JO: We don’t have a national health IT system that is interoperable. Interoperability means that records from one doctor’s office can actually speak to a doctor in a different office or to a hospital. To really be effective in managing care, that sort of information sharing must happen. The Kaiser and VA systems are integrated systems, and that may be one reason they have better results.

TL: Is there a requirement that systems be interoperable?

JO: I think the stimulus legislation requires hospitals to make progress in this area before receiving federal money.

TL: What is the key story journalists should be sniffing out about health IT?

JO: How the Obama administration defines the use of electronic records. Here it’s not just a case of the devil being in the details—the dollars are in the details.

TL: What other stories should the press be tackling?

JO: I would say there haven’t been many stories looking at who stands to profit from the money we are spending on IT—with the exception of The Washington Post. I also think there needs to be more attention to the experience of Kaiser and the VA. The question of why providers are not using the VA’s VistA system, even though it’s available to them, is an interesting story that The Boston Globe highlighted.

TL: What does lack of acceptance about the VistA system, which is freely accessible, say about American marketing and sales practices?

JO: We have a fragmented health system, and that fragmentation shows up in many ways, including the marketing and sale of multiple health information technology systems. That decentralization has advantages—it may produce more innovation. But it makes coordination quite difficult. If health IT is going to help us better coordinate medical care delivery, first we have to ensure that we have a coordinated health IT system.

Has America ever needed a media watchdog more than now? Help us by joining CJR today.

Trudy Lieberman is a longtime contributing editor to the Columbia Journalism Review. She is the lead writer for The Second Opinion, CJR's healthcare desk, which is part of our United States Project on the coverage of politics and policy. She also blogs for Health News Review. Follow her on Twitter @Trudy_Lieberman.