A CPOE system at a large academic hospital that was implemented about 10 years ago saved the hospital about $2.2 million annually with current savings of $16.7 million per year. The operating budget savings were $9.5 million ($1.3 million annualized). It took over five years for the BWH system to begin accruing a net benefit and over seven years to begin accruing an operating budget benefit.
The level and type of decision support were directly related to the amount of savings the hospital achieved. Renal drug dosing, ADE prevention, and expensive or specific drug guidance were the most financially beneficial interventions. It is important to note that the majority of savings accrued from a relatively small number of interventions. These results suggest that hospitals should consider focusing on these CDSS interventions to increase the chance of financial profitability from their CPOE systems. In addition, hospitals should pay careful attention to the method of workflow integration to save nursing and physician time. Expensive drug guidance is an increasingly important type of decision support given the rapid emergence of new drugs. In this model, we included cost containment of human growth hormone and ondansetron but not other expensive medications.
Of note, we included only BWH CDSS elements for which there were good estimates of cost savings in the model. We were unable to include several BWH CDSS elements in the study due to either their timing of implementation or the lack of reliable cost savings data. Even though many interventions have been implemented at BWH, this CPOE system lacks numerous other highly effective interventions such as LDS Hospital's antibiotic assistant.34,35
Further studies of the potential benefits of specific elements of CDSS are necessary for hospitals to accurately understand the value of CPOE.
In performing these analyses, we assumed that costs and benefits would be equally affected by inflation over time. If the price of medical services is growing more rapidly than general inflation, as is likely, then the discount rate is actually declining over time in real terms. If the discount is overestimated in this way, the model would tend to underestimate benefits rather than costs as we front-loaded costs and back-loaded benefits in our analysis.
To achieve the types of benefits modeled based on BWH data, a hospital must have nearly 100% physician use, well-designed CDSS elements, and effective interfaces among CPOE, pharmacy, laboratory, and medication administration record systems. Some hospitals have overcome large financial barriers to implement CPOE, only to fail to achieve widespread use due to physician resistance.36,37
In addition, the automated knowledge necessary for CDSS elements must be represented in ways that allow it to be readily interchanged between different computer systems. Benefits may vary substantially among different vendor applications based on factors like these. The benefits of increased workflow efficiency are perhaps the most difficult to achieve as they require all these factors along with a quick system, although they are very important given the national shortages of nurses and pharmacists.
This study has several limitations. Ideally, all benefit data would have been collected prospectively rather than retrospectively. Active data collection would have decreased the number of estimates by institutional experts. In addition, we did not include less direct benefits of CPOE such as averted malpractice litigation from fewer ADEs.38
We excluded several decision support elements of the BWH system for which we could not calculate benefits. Our model is purely cost avoidance and does not directly address increased revenue. CPOE systems often result in improved billing, but these savings were not incorporated in our benefit estimates. Nor did we include increased efficiencies for personnel such as pharmacists since reliable institutional estimates were not available.
Of note, we did not include all the costs of knowledge engineering by clinicians and engineers to create and encode clinical information with CDSSs. Information technology staff time is included, but not the time devoted by clinicians and researchers in developing clinical rules. These hidden costs were piecemeal over many years and probably represented a relatively small part of the entire costs. Finally, it is essential to note that the vast majority of implemented CPOE systems are vendor based rather than home grown such as the BWH system. Clearly the benefits of CDSS from vendor systems may be different than those from the BWH system limiting generalizability.
In conclusion, the BWH saved significant money by implementing the CPOE system. Other hospitals may realize even greater benefits, particularly if they have high levels of clinical decision support and rates of prospective reimbursement. While many hospitals need assistance accessing capital to purchase a CPOE system, the financial benefits may help justify the expense. Furthermore, hospitals may not require long-term ongoing financial support, although it will be important for institutions to take a long-term perspective. Patient safety is a critical part of the health care mission and the implementation of CPOE can make health care safer and save money.