Healthcare

Personal health records to save US$21 billion a year?

By Jianggan Li | 24 November 2008

A US study has projected that personal health records (PHRs) could potentially save the country US$21 billion a year.

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PHRs are web-based systems that allow patients to maintain their medical data to better manage their healthcare.

The independent study, funded by Healthcare Information Management and Systems Society (HIMSS) and some leading PHR suppliers, also found that interoperable PHR systems offer the maximum potential benefits.

The study was carried out by the Centre for Information Technology Leadership (CITL), a Boston-based non-profit research institute.

The study highlights the benefits of PHRs in terms of reduction of waste and error, decreased administrative cost, and decreased clinical costs. The savings would be realised by both healthcare payers and providers, with the majority of benefits going to payers.

The US$21 billion annual savings are estimated based on the implementation of an interoperable PHR that provides eight key functions: sharing of test results, sharing of medication lists, congestive heart failure management, smoking cessation management, appointment scheduling, medication renewals, pre-consultation questionnaires and e-visits.

PHR-enabled e-visits can help reduce the amount of patient travel to doctors and equate to annual savings. CITL’s PHR Advisory Board estimated that the average American would save 7.6 hours per year though e-visits, equating to an annual savings of US$20 billion in recovered wages (given a national workforce of 150 million people with an average wage of US$17.63 per hour).

The figures are based on a 10-year rollout and assume an 80 per cent usage rate is achieved in the US.

According to the study providing interoperable PHRs for 80 per cent of the US population could be acquired for US$3.7 billion, with annual maintenance costs of US$1.9 billion.

Therefore the net annual value of interoperable PHRs could be $19 billion annually.

“By adopting PHRs and enabling e-visits, we have the potential to dramatically improve the quality of care and contain costs,” said Doug Johnston, executive director of CITL and one of the report’s authors.

CITL examined the financial value of four different models of PHRs – those tied to healthcare providers, tied to healthcare funders, third-party systems and the interoperable PHRs. All PHRs shared common functions of information collection, sharing, information for self-management and healthcare information exchange.

The report puts a figure against how many users each single installation of the contending PHR architectures would require to be net positive. The figure for third-party PHRs is put at 47m; 62,000 for payer-tied; 59,000 for provider-tied; and 52,000 for interoperable PHRs.