In the past, mentioning electronic health records (EHRs) to pharma industry marketing departments would mostly elicit, if anything, yawns and conversation-stoppers. They're too costly to install and maintain, and therefore most physician practices aren't using them. In 2008, when the Journal of the American Medical Informatics Association (JAMIA) published a case study from Pfizer's healthcare informatics group, which examined how EHRs might support business functions, the primary conclusions were that EHRs could potentially be valuable in some areas, such as drug safety and surveillance or clinical trial recruitment. The assumption was that EHRs could provide patient data and contribute to a more robust database for drug monitoring, but again, without widespread physician adoption, the benefits of EHRs for pharma seemed limited.
Then, in 2009, the Obama Administration earmarked a whopping $19.2 billion for EHRs as part of the American Recovery and Reinvestment Act (ARRA), and put new incentives in place for adoption; the Congressional Budget Office (CBO) estimates that healthcare information technology (HCIT) spending could top $36 billion. Under the well-known "meaningful use" provision of the ARRA, sticks have now emerged, in addition to the carrots, for EHR adoption and e-prescribing. Physician practices stand to receive up to $44,000 per physician over a five-year period if they adopt EHRs in 2011, direct from the Centers for Medicare & Medicaid Services (CMS). Penalties for non-adoption begin in 2015. Some physicians jumped on board soon after the incentive program was announced, but the vast majority did not. In 2009, approximately 153,000 physicians were using EHRs in their practice, and in 2010, that number increased to 171,000. Beginning this year, however, adoption rates are expected to grow exponentially, with 254,000 physicians using EHRs in 2011, and 376,000 in 2012. By 2013, roughly 70 percent of physicians, or 557,000, are expected to be using EHRs. The CBO predicts that 80 percent, or 726,000 physicians, will be using EHRs by 2019.While the biggest providers of EHRs, such as Epic, Allscipts/Eclipsys, and NextGen, are well established, and medium-size players such as Cerner, Sage, Greenway, and AthenaHealth have made headway with early adopters, there haven't been, until recently, EHR providers that offer a clear way in for pharma.
Other parties, besides EHR providers, have recognized the value of EHRs. Hospitals are now actively purchasing EHR platforms for physician practices, assuming that a systems alignment between a physician group and a hospital will boost referrals—a safe bet, according to Fotsch. "If the EHR platforms are in sync, and really accessible, between a physician's office and the hospital, so that dictations, lab results, and so on can be freely exchanged, [the physician] is much more likely to refer to that hospital," he says. Hospitals such as Advocate in Chicago, Sisters of Charity of Health System in Cleveland, Long Island Jewish Medical Center in New York, and others have committed "tens of millions of dollars" to bolstering referral lines through EHR purchases, says Fotsch. Asked whether pharmaceutical companies could see a positive ROI on purchasing EHRs for doctors, Fotsch says part of the reason that pharma has been left out of EHR design to date is that pharma "can't legally give away EHRs; that would be a broad inurement issue."