The goals of the HITECH Act are to transform the healthcare system for improved quality and efficiency through increased and improved EHR use. A key policy question is, to what extent will hospitals adopt and meaningfully use EHR systems based on the incentives? It is important to have an understanding of the characteristics of hospitals that indicate an intention to pursue meaningful use incentives in order to assess the anticipated impact of the policy and guide any adjustments needed to improve its effectiveness.
Our main finding is that a high proportion of hospitals are interested in pursuing incentives, but certain characteristics are associated with a higher likelihood of intention to pursue incentives. In particular, having EHRs already in place greatly increases the likelihood of intention to pursue incentives. In fact, current EHR use is the highest positive correlate in our model as indicated by the marginal effect. The policy goals of the HITECH Act depend on meaningful use of EHRs, which in turn depends on EHR adoption. However, it appears that the Medicare and Medicaid incentive policy may not be encouraging nonadopters to adopt EHRs and become meaningful EHR users at the same rates as their counterparts who have already adopted or began their migrations to EHRs.
The goals of the HITECH Act are to improve the efficiency and quality of the healthcare system,12
and there are incremental benefits to both EHR adoption and achieving meaningful use. The HITECH Act may disproportionately move current EHR users to meaningful use at the expense of moving non-EHR users to EHR adoption and meaningful use. The marginal benefit of moving current users to meaningful use may not outweigh the intended benefits anticipated from moving nonusers to adoption and meaningful use. Because the marginal benefit of having those hospitals that already use EHRs becoming meaningful users is unclear, the impact of the HITECH Act could be attenuated.
A second important finding is that for-profit hospitals and system members are less likely to indicate an intention to pursue meaningful use incentives. For-profit hospitals may be more likely to conduct a traditional return-on-investment calculation, which may lead to the conclusion that the cost of applying for incentives or the process itself outweighs any potential incentive payments or penalties. Our study's finding that “cost” is one of the major reasons for not pursuing incentives supports this explanation. System hospitals may also face complexities arising from their structure and the size of their enterprise that discourage them from wanting to pursue incentives, especially if those incentives are not viewed as financially worthwhile. A large number of the free-form responses to the “other” category of reasons for not pursuing incentives related to the decision's resting with the system rather than the hospital. We were not able to quantify these qualitative responses, but they do suggest that the effect of the system is important. The incentives may not be sufficient for system hospitals that may have a more difficult time implementing meaningful EHR use across many facilities. Future research should focus on system hospitals and determine if certain system types13
impact the decision to pursue meaningful use incentives.
Third, the percentage of Medicare and Medicaid discharges does not appear to influence the intention to pursue incentives. This finding was consistent across all ranges of Medicare and Medicaid volume. The most likely explanation for this finding is that hospitals believe that the size of additional incentives for higher Medicare or Medicaid patient volumes is not sufficient to overcome the barriers of adopting EHRs and achieving meaningful use.
Lastly, our findings suggest that rural hospitals are less likely to indicate an intention to pursue meaningful use incentives. Previous research has indicated that rural hospitals are less likely to adopt EHRs.14
Some rural hospitals may find it challenging to attract EHR vendors, and when they do, they may find that vendor products do not meet their unique needs. Furthermore, rural hospitals may not have the financial or human resource capacity to manage EHR implementation and achieve meaningful use, and recruiting such talent to isolated areas could be difficult. Other HITECH programs such as the Regional Extension Centers are focused primarily on small physician practices and a subset of rural hospitals (e.g., critical access hospitals), which may leave other rural hospitals with little support for EHR adoption and meaningful use. Policy makers should consider adjustments to the meaningful use incentive program that address these findings.
A limitation of this study is that it analyzes the stated intention to pursue meaningful use incentives, which may not reflect the actual pursuit of incentives. It is reasonable to suggest, however, that the actual pursuit of incentives will be less than intended, given the difficulty and complexity of achieving meaningful use. Nevertheless, now is the time for policy makers and decision makers to ensure that issues that threaten the maximum impact of the HITECH Act are addressed. Second, the analysis relies on self-reported secondary data from 2009, which may introduce recall and selection biases.15
To address the issue of selection bias, we compared respondents to our dependent variable with nonrespondents and did not find any differences based on hospital characteristics. Lastly, the measurement of EHR adoption in secondary sources has known reliability and validity issues.16
It is unknown whether these measurement issues are influencing our results.
Our findings indicate that the policy goals of the HITECH Act may not be optimally achieved based on the indicated intention of hospitals to pursue meaningful use. However, the program is still in its early stages, with incentive payments beginning in fiscal year 2011. Our data provide CMS and state Medicaid agencies the opportunity to make adjustments that may improve the chances of achieving the overall policy goals. For example, they could modify incentive payments based on the distance hospitals are from achieving meaningful use so that hospitals that have yet to adopt EHRs may stand to receive higher incentives than those that have already adopted them. They could also focus on for-profit and system hospitals, perhaps in combination with their EHR adoption status. Lastly, they may consider higher incentive payments to rural hospitals to provide additional motivation for EHR adoption and additional financial resources for these facilities.