Physician Income Lowering – EMR as the Solution or Problem

Posted on September 24, 2010 I Written By

John Lynn is the Founder of the blog network which currently consists of 10 blogs containing over 8000 articles with John having written over 4000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 16 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of and John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit and LinkedIn.

Evan Steele, CEO of SRSsoft has an interesting post called “Preserving Physician Income in a Low-Margin Environment: EMR Strategy up on his blog which does a great job summarizing a physician’s income with a nice graph. In it he shows the 3 main drivers of expenses and income for a doctor: Reimbursement, Overhead and Income. Then, he offers this interesting analysis:

Given that physicians have no control over reimbursement rates, the only way to positively impact that green line is by effecting fundamental changes to practice operations—and the right EMR is critical to this end.

First, it is imperative to significantly reduce overhead—the orange line. Government programs that may, or may not, deliver short-term financial incentives do not address cost structure. What is needed is an EMR that delivers sustainable and significant reductions in the staff-to-physician ratio and more efficient management of all resources—depressing the orange line. Increasing revenue—the blue line—requires increases in physician productivity and patient volume. The challenge here is to wade through EMR marketing hype to identify the EMR that will actually shift the orange line [overhead] down and the blue [reimbursements] and green [income] lines up.

I read today of one physician’s concern over the GOP’s Pledge to America taking away the EHR stimulus money in the HITECH act. Luckily, this physician was wisely counseled that someone buying an EHR solely for the government handout better think twice.

Instead, the analysis above is a much better gauge for measuring an EMR software. Will it increase productivity? Will it increase reimbursement? Will it decrease staff-to-physician ratio? or will it do any of these other EMR benefits?

All of these questions will help you answer the question of whether a certain EMR software will help to improve Physician income or not. For those that think this doesn’t matter, go visit some more docs.