Erik Goldman

DENVER — Physicians may not be enamored of Medicare, but they like it a whole lot better than private insurance plans, according to a survey by the Medical Group Management Association.

MGMA's Payer Performance Study—covering more than 1,700 group practices—showed that physicians groups ranked Medicare Part B well ahead of six of the largest private insurance companies in terms of overall satisfaction. The organization released the data at its annual meeting.

The survey asked participants, all of whom were members of MGMA, to rank seven of the largest payers (Medicare Part B, UnitedHealthcare, Aetna, Cigna, Humana, Coventry, and Anthem) on parameters including payer communications, provider credentialing, contract negotiation, payment processing, systems transparency, and overall satisfaction.

Medicare led the pack with a mean aggregate satisfaction score of 3.59 on a 6-point scale. Aetna took second place with a score of 3.14. The big loser? UnitedHealthcare, with a score of 2.45.

Medicare scored particularly well on the amount of time it takes to respond to questions from physicians or practice managers, the accuracy of its responses, and transparency in disclosing fee schedules and reimbursement policies.

The respondents were much less satisfied with Medicare's provider-credentialing processes. On that measure, Medicare ranked last, with Aetna and Anthem taking first and second place. “The Medicare credentialing process is completely out of synch with that of the private payers, and it is a problem,” said Dr. William Jessee, president and chief executive officer of MGMA.

Dr. Jessee said that the data show particularly strong member dissatisfaction with the private insurers on the matter of negotiating contracts. “MGMA members feel there is disproportionate power on the side of the payers.”

Although Medicare may have scored better than the private insurers, the scores suggest there's much room for improvement in the federal program. Dr. Jessee said that the MGMA survey deliberately did not ask about satisfaction with actual reimbursement rates, but he anticipated that Medicare's relatively favorable ranking could drop considerably if the federal government cuts physician fees in the future.

Medical group operating costs have been increasing at a rate of 6.5% per year, on average, for the last decade, yet Medicare reimbursement has been flat. That, said Dr. Jessee, is making it difficult for many groups to stay in business. Any further cuts in fees will likely discourage many doctors from continuing to participate in Medicare.

DENVER — Physicians may not be enamored of Medicare, but they like it a whole lot better than private insurance plans, according to a survey by the Medical Group Management Association.

MGMA's Payer Performance Study—covering more than 1,700 group practices—showed that physicians groups ranked Medicare Part B well ahead of six of the largest private insurance companies in terms of overall satisfaction. The organization released the data at its annual meeting.

The survey asked participants, all of whom were members of MGMA, to rank seven of the largest payers (Medicare Part B, UnitedHealthcare, Aetna, Cigna, Humana, Coventry, and Anthem) on parameters including payer communications, provider credentialing, contract negotiation, payment processing, systems transparency, and overall satisfaction.

Medicare led the pack with a mean aggregate satisfaction score of 3.59 on a 6-point scale. Aetna took second place with a score of 3.14. The big loser? UnitedHealthcare, with a score of 2.45.

Medicare scored particularly well on the amount of time it takes to respond to questions from physicians or practice managers, the accuracy of its responses, and transparency in disclosing fee schedules and reimbursement policies.

The respondents were much less satisfied with Medicare's provider-credentialing processes. On that measure, Medicare ranked last, with Aetna and Anthem taking first and second place. “The Medicare credentialing process is completely out of synch with that of the private payers, and it is a problem,” said Dr. William Jessee, president and chief executive officer of MGMA.

Dr. Jessee said that the data show particularly strong member dissatisfaction with the private insurers on the matter of negotiating contracts. “MGMA members feel there is disproportionate power on the side of the payers.”

Although Medicare may have scored better than the private insurers, the scores suggest there's much room for improvement in the federal program. Dr. Jessee said that the MGMA survey deliberately did not ask about satisfaction with actual reimbursement rates, but he anticipated that Medicare's relatively favorable ranking could drop considerably if the federal government cuts physician fees in the future.

Medical group operating costs have been increasing at a rate of 6.5% per year, on average, for the last decade, yet Medicare reimbursement has been flat. That, said Dr. Jessee, is making it difficult for many groups to stay in business. Any further cuts in fees will likely discourage many doctors from continuing to participate in Medicare.

DENVER — Physicians may not be enamored of Medicare, but they like it a whole lot better than private insurance plans, according to a survey by the Medical Group Management Association.

MGMA's Payer Performance Study—covering more than 1,700 group practices—showed that physicians groups ranked Medicare Part B well ahead of six of the largest private insurance companies in terms of overall satisfaction. The organization released the data at its annual meeting.

The survey asked participants, all of whom were members of MGMA, to rank seven of the largest payers (Medicare Part B, UnitedHealthcare, Aetna, Cigna, Humana, Coventry, and Anthem) on parameters including payer communications, provider credentialing, contract negotiation, payment processing, systems transparency, and overall satisfaction.

Medicare led the pack with a mean aggregate satisfaction score of 3.59 on a 6-point scale. Aetna took second place with a score of 3.14. The big loser? UnitedHealthcare, with a score of 2.45.

Medicare scored particularly well on the amount of time it takes to respond to questions from physicians or practice managers, the accuracy of its responses, and transparency in disclosing fee schedules and reimbursement policies.

The respondents were much less satisfied with Medicare's provider-credentialing processes. On that measure, Medicare ranked last, with Aetna and Anthem taking first and second place. “The Medicare credentialing process is completely out of synch with that of the private payers, and it is a problem,” said Dr. William Jessee, president and chief executive officer of MGMA.

Dr. Jessee said that the data show particularly strong member dissatisfaction with the private insurers on the matter of negotiating contracts. “MGMA members feel there is disproportionate power on the side of the payers.”

Although Medicare may have scored better than the private insurers, the scores suggest there's much room for improvement in the federal program. Dr. Jessee said that the MGMA survey deliberately did not ask about satisfaction with actual reimbursement rates, but he anticipated that Medicare's relatively favorable ranking could drop considerably if the federal government cuts physician fees in the future.

Medical group operating costs have been increasing at a rate of 6.5% per year, on average, for the last decade, yet Medicare reimbursement has been flat. That, said Dr. Jessee, is making it difficult for many groups to stay in business. Any further cuts in fees will likely discourage many doctors from continuing to participate in Medicare.

DENVER — Multispecialty group practice revenue dropped last year for the first time in a decade as practices across the country felt the impact of the recession, but primary care revenue appears relatively healthy.

The Medical Group Management Association's Cost Survey for 2009 showed a 1.9% decline in mean total medical gross revenue among multispecialty groups, as well as a 9.9% drop in volume of medical procedures (indicated by RVUs provided per patient) and an 11% decrease in total patient volume. Bad debt from fee-for-service charges increased by 13%.

The 2009 report, released at the MGMA's annual conference, was based on 2008 data and so represents a snapshot of the early phase of the recession. Current conditions could be significantly worse, but won't likely show up until the next survey, said Dr. William F. Jessee, president and chief executive officer of MGMA, who presented the data.

Though fully one-third of practices surveyed reported a decrease in total revenue in 2008, the news isn't all bad. Data on single-specialty groups showed some clear winners, even in these hard times. In particular, cardiologists reported a 7.9% mean increase in total revenue after operating costs. Pediatricians topped that, with a 9% increase. Family physicians reported a 2.4% mean increase.

Hardest hit were gastroenterologists, with a 5% drop in revenue. In general, the procedure-based specialties are feeling the hardest squeeze, Dr. Jessee noted.

Still, even in the sectors that have seen increases, the percentage increase in gross revenue is only a few points higher than the rising costs of staying in practice, if that much. Many practices, especially the smaller ones, are struggling.

Dr. Jessee said that group practices are tightening their belts.

On average, practices reported reducing support staff costs by 1.5%, though there were no reported significant changes in number of staff members. That means only one thing: Many employees have taken pay cuts. In some cases, the doctors themselves are taking home less pay, he pointed out.

Thirty-five percent of practices have instituted hiring freezes, and 34% say they've cut operating budgets. Thirty-seven percent said that they have postponed capital expenditures.

More than one-third of the practices in the survey said that they have seen an increase in the number of uninsured patients in 2008.

Solo and physician-owned small group practices have been especially hard hit by the recession, and increasingly they are reaching out to hospitals and the large group practices for a lifeline. MGMA surveys over the last decade show clearly that America's doctors are huddling up and selling out to larger health care entities, Dr. Jessee said.

The number of MGMA member groups owned by hospitals grew by 20% during the 5-year period from 2003 to 2008, and they now comprise 10% of the organization's total membership.

During that time, the average number of physicians in MGMA member group practices increased from 16 in 2003 to 19 in 2008.

The number of doctors in the average hospital-owned group rose from 64 to 76, a 19% increase. “There's a big, big trend toward consolidation,” Dr. Jessee said.

Not surprisingly, the economic downturn has affected MGMA itself. The organization acknowledged that attendance at this year's annual meeting—roughly 2,150 paid attendees—was down 21% from its peak several years ago.

DENVER — Multispecialty group practice revenue dropped last year for the first time in a decade as practices across the country felt the impact of the recession, but primary care revenue appears relatively healthy.

The Medical Group Management Association's Cost Survey for 2009 showed a 1.9% decline in mean total medical gross revenue among multispecialty groups, as well as a 9.9% drop in volume of medical procedures (indicated by RVUs provided per patient) and an 11% decrease in total patient volume. Bad debt from fee-for-service charges increased by 13%.

The 2009 report, released at the MGMA's annual conference, was based on 2008 data and so represents a snapshot of the early phase of the recession. Current conditions could be significantly worse, but won't likely show up until the next survey, said Dr. William F. Jessee, president and chief executive officer of MGMA, who presented the data.

Though fully one-third of practices surveyed reported a decrease in total revenue in 2008, the news isn't all bad. Data on single-specialty groups showed some clear winners, even in these hard times. In particular, cardiologists reported a 7.9% mean increase in total revenue after operating costs. Pediatricians topped that, with a 9% increase. Family physicians reported a 2.4% mean increase.

Hardest hit were gastroenterologists, with a 5% drop in revenue. In general, the procedure-based specialties are feeling the hardest squeeze, Dr. Jessee noted.

Still, even in the sectors that have seen increases, the percentage increase in gross revenue is only a few points higher than the rising costs of staying in practice, if that much. Many practices, especially the smaller ones, are struggling.

Dr. Jessee said that group practices are tightening their belts.

On average, practices reported reducing support staff costs by 1.5%, though there were no reported significant changes in number of staff members. That means only one thing: Many employees have taken pay cuts. In some cases, the doctors themselves are taking home less pay, he pointed out.

Thirty-five percent of practices have instituted hiring freezes, and 34% say they've cut operating budgets. Thirty-seven percent said that they have postponed capital expenditures.

More than one-third of the practices in the survey said that they have seen an increase in the number of uninsured patients in 2008.

Solo and physician-owned small group practices have been especially hard hit by the recession, and increasingly they are reaching out to hospitals and the large group practices for a lifeline. MGMA surveys over the last decade show clearly that America's doctors are huddling up and selling out to larger health care entities, Dr. Jessee said.

The number of MGMA member groups owned by hospitals grew by 20% during the 5-year period from 2003 to 2008, and they now comprise 10% of the organization's total membership.

During that time, the average number of physicians in MGMA member group practices increased from 16 in 2003 to 19 in 2008.

The number of doctors in the average hospital-owned group rose from 64 to 76, a 19% increase. “There's a big, big trend toward consolidation,” Dr. Jessee said.

Not surprisingly, the economic downturn has affected MGMA itself. The organization acknowledged that attendance at this year's annual meeting—roughly 2,150 paid attendees—was down 21% from its peak several years ago.

DENVER — Multispecialty group practice revenue dropped last year for the first time in a decade as practices across the country felt the impact of the recession, but primary care revenue appears relatively healthy.

The Medical Group Management Association's Cost Survey for 2009 showed a 1.9% decline in mean total medical gross revenue among multispecialty groups, as well as a 9.9% drop in volume of medical procedures (indicated by RVUs provided per patient) and an 11% decrease in total patient volume. Bad debt from fee-for-service charges increased by 13%.

The 2009 report, released at the MGMA's annual conference, was based on 2008 data and so represents a snapshot of the early phase of the recession. Current conditions could be significantly worse, but won't likely show up until the next survey, said Dr. William F. Jessee, president and chief executive officer of MGMA, who presented the data.

Though fully one-third of practices surveyed reported a decrease in total revenue in 2008, the news isn't all bad. Data on single-specialty groups showed some clear winners, even in these hard times. In particular, cardiologists reported a 7.9% mean increase in total revenue after operating costs. Pediatricians topped that, with a 9% increase. Family physicians reported a 2.4% mean increase.

Hardest hit were gastroenterologists, with a 5% drop in revenue. In general, the procedure-based specialties are feeling the hardest squeeze, Dr. Jessee noted.

Still, even in the sectors that have seen increases, the percentage increase in gross revenue is only a few points higher than the rising costs of staying in practice, if that much. Many practices, especially the smaller ones, are struggling.

Dr. Jessee said that group practices are tightening their belts.

On average, practices reported reducing support staff costs by 1.5%, though there were no reported significant changes in number of staff members. That means only one thing: Many employees have taken pay cuts. In some cases, the doctors themselves are taking home less pay, he pointed out.

Thirty-five percent of practices have instituted hiring freezes, and 34% say they've cut operating budgets. Thirty-seven percent said that they have postponed capital expenditures.

More than one-third of the practices in the survey said that they have seen an increase in the number of uninsured patients in 2008.

Solo and physician-owned small group practices have been especially hard hit by the recession, and increasingly they are reaching out to hospitals and the large group practices for a lifeline. MGMA surveys over the last decade show clearly that America's doctors are huddling up and selling out to larger health care entities, Dr. Jessee said.

The number of MGMA member groups owned by hospitals grew by 20% during the 5-year period from 2003 to 2008, and they now comprise 10% of the organization's total membership.

During that time, the average number of physicians in MGMA member group practices increased from 16 in 2003 to 19 in 2008.

The number of doctors in the average hospital-owned group rose from 64 to 76, a 19% increase. “There's a big, big trend toward consolidation,” Dr. Jessee said.

Not surprisingly, the economic downturn has affected MGMA itself. The organization acknowledged that attendance at this year's annual meeting—roughly 2,150 paid attendees—was down 21% from its peak several years ago.

DENVER — Physicians may not be enamored of Medicare, but they like it a whole lot better than private insurance plans, according to a survey by the Medical Group Management Association.

MGMA's Payer Performance Study—covering more than 1,700 group practices—showed that physicians groups ranked Medicare Part B well ahead of six of the largest private insurance companies in terms of overall satisfaction. The organization released the data at its annual meeting.

The survey asked participants, all of whom were members of MGMA, to rank seven of the largest payers—Medicare Part B, UnitedHealthcare, Aetna, Cigna, Humana, Coventry, and Anthem—on parameters including payer communications, provider credentialing, contract negotiation, payment processing, systems transparency, and overall satisfaction.

Medicare led the pack with a mean aggregate satisfaction score of 3.59 on a 6-point scale (1 = totally dissatisfied, 6 = completely satisfied). Aetna took second place with a score of 3.14.

The big loser? UnitedHealthcare, with a score of 2.45.

Medicare scored particularly well on the amount of time it takes to respond to questions from physicians or practice managers.

Medicare also scored better than private insurance companies on the accuracy of its responses, and transparency in disclosing fee schedules and reimbursement policies.

The survey respondents were much less satisfied with Medicare's provider credentialing processes. On that measure, the Medicare ranked last, with Aetna and Anthem taking first and second place.

“The Medicare credentialing process is completely out of synch with that of the private payers, and it is a problem,” said Dr. William Jessee, president and chief executive officer of MGMA.

Dr. Jessee said that the data show particularly strong member dissatisfaction with the private insurers on the matter of negotiating contracts. “MGMA members feel there is disproportionate power on the side of the payers.”

Although Medicare may have scored better than the private insurance companies, the scores suggest there's much room for improvement in the federal program.

Dr. Jessee said that the MGMA survey deliberately did not ask about satisfaction with actual reimbursement rates, but he anticipated that Medicare's relatively favorable ranking could drop considerably if the federal government goes forward with its proposed 21% physician fee cuts next year.

The fee-shearing is among a number of federal-level issues on which MGMA is taking action.

“We have three major tasks: repeal the sustainable growth rate [SGR] formula as outlined in HR3200 and most other bills; create a reimbursement formula that accurately reimburses physicians for their actual costs; and simplify administrative transactions,” he said.

Medical group operating costs have been increasing at a rate of 6.5% per year, on average, for the last decade, yet Medicare reimbursement has been flat. That, said Dr. Jessee, is making it difficult for many physician groups to stay in business.

Any further cuts in reimbursement fees will likely discourage many doctors from continuing to participate in Medicare, he added.

MGMA is committed to fighting the cuts and repealing the SGR formula, and the group has made some progress in Washington, but “there's a lot more game to be played,” he said.

DENVER — Physicians may not be enamored of Medicare, but they like it a whole lot better than private insurance plans, according to a survey by the Medical Group Management Association.

MGMA's Payer Performance Study—covering more than 1,700 group practices—showed that physicians groups ranked Medicare Part B well ahead of six of the largest private insurance companies in terms of overall satisfaction. The organization released the data at its annual meeting.

The survey asked participants, all of whom were members of MGMA, to rank seven of the largest payers—Medicare Part B, UnitedHealthcare, Aetna, Cigna, Humana, Coventry, and Anthem—on parameters including payer communications, provider credentialing, contract negotiation, payment processing, systems transparency, and overall satisfaction.

Medicare led the pack with a mean aggregate satisfaction score of 3.59 on a 6-point scale (1 = totally dissatisfied, 6 = completely satisfied). Aetna took second place with a score of 3.14.

The big loser? UnitedHealthcare, with a score of 2.45.

Medicare scored particularly well on the amount of time it takes to respond to questions from physicians or practice managers.

Medicare also scored better than private insurance companies on the accuracy of its responses, and transparency in disclosing fee schedules and reimbursement policies.

The survey respondents were much less satisfied with Medicare's provider credentialing processes. On that measure, the Medicare ranked last, with Aetna and Anthem taking first and second place.

“The Medicare credentialing process is completely out of synch with that of the private payers, and it is a problem,” said Dr. William Jessee, president and chief executive officer of MGMA.

Dr. Jessee said that the data show particularly strong member dissatisfaction with the private insurers on the matter of negotiating contracts. “MGMA members feel there is disproportionate power on the side of the payers.”

Although Medicare may have scored better than the private insurance companies, the scores suggest there's much room for improvement in the federal program.

Dr. Jessee said that the MGMA survey deliberately did not ask about satisfaction with actual reimbursement rates, but he anticipated that Medicare's relatively favorable ranking could drop considerably if the federal government goes forward with its proposed 21% physician fee cuts next year.

The fee-shearing is among a number of federal-level issues on which MGMA is taking action.

“We have three major tasks: repeal the sustainable growth rate [SGR] formula as outlined in HR3200 and most other bills; create a reimbursement formula that accurately reimburses physicians for their actual costs; and simplify administrative transactions,” he said.

Medical group operating costs have been increasing at a rate of 6.5% per year, on average, for the last decade, yet Medicare reimbursement has been flat. That, said Dr. Jessee, is making it difficult for many physician groups to stay in business.

Any further cuts in reimbursement fees will likely discourage many doctors from continuing to participate in Medicare, he added.

MGMA is committed to fighting the cuts and repealing the SGR formula, and the group has made some progress in Washington, but “there's a lot more game to be played,” he said.

DENVER — Physicians may not be enamored of Medicare, but they like it a whole lot better than private insurance plans, according to a survey by the Medical Group Management Association.

MGMA's Payer Performance Study—covering more than 1,700 group practices—showed that physicians groups ranked Medicare Part B well ahead of six of the largest private insurance companies in terms of overall satisfaction. The organization released the data at its annual meeting.

The survey asked participants, all of whom were members of MGMA, to rank seven of the largest payers—Medicare Part B, UnitedHealthcare, Aetna, Cigna, Humana, Coventry, and Anthem—on parameters including payer communications, provider credentialing, contract negotiation, payment processing, systems transparency, and overall satisfaction.

Medicare led the pack with a mean aggregate satisfaction score of 3.59 on a 6-point scale (1 = totally dissatisfied, 6 = completely satisfied). Aetna took second place with a score of 3.14.

The big loser? UnitedHealthcare, with a score of 2.45.

Medicare scored particularly well on the amount of time it takes to respond to questions from physicians or practice managers.

Medicare also scored better than private insurance companies on the accuracy of its responses, and transparency in disclosing fee schedules and reimbursement policies.

The survey respondents were much less satisfied with Medicare's provider credentialing processes. On that measure, the Medicare ranked last, with Aetna and Anthem taking first and second place.

“The Medicare credentialing process is completely out of synch with that of the private payers, and it is a problem,” said Dr. William Jessee, president and chief executive officer of MGMA.

Dr. Jessee said that the data show particularly strong member dissatisfaction with the private insurers on the matter of negotiating contracts. “MGMA members feel there is disproportionate power on the side of the payers.”

Although Medicare may have scored better than the private insurance companies, the scores suggest there's much room for improvement in the federal program.

Dr. Jessee said that the MGMA survey deliberately did not ask about satisfaction with actual reimbursement rates, but he anticipated that Medicare's relatively favorable ranking could drop considerably if the federal government goes forward with its proposed 21% physician fee cuts next year.

The fee-shearing is among a number of federal-level issues on which MGMA is taking action.

“We have three major tasks: repeal the sustainable growth rate [SGR] formula as outlined in HR3200 and most other bills; create a reimbursement formula that accurately reimburses physicians for their actual costs; and simplify administrative transactions,” he said.

Medical group operating costs have been increasing at a rate of 6.5% per year, on average, for the last decade, yet Medicare reimbursement has been flat. That, said Dr. Jessee, is making it difficult for many physician groups to stay in business.

Any further cuts in reimbursement fees will likely discourage many doctors from continuing to participate in Medicare, he added.

MGMA is committed to fighting the cuts and repealing the SGR formula, and the group has made some progress in Washington, but “there's a lot more game to be played,” he said.

DENVER — Multispecialty group practice revenue dropped last year for the first time in a decade as practices across the country felt the impact of the recession, but primary care revenue appears relatively healthy.

The Medical Group Management Association's Cost Survey for 2009 showed a 1.9% decline in mean total medical gross revenue among multispecialty groups, as well as a 9.9% drop in volume of medical procedures (indicated by RVUs provided per patient) and an 11% decrease in total patient volume. Not surprisingly, bad debt from fee-for-service charges increased by 13%.

The 2009 report, released at the MGMA's annual conference, was based on 2008 data and so represents a snapshot of the early phase of the recession. Current conditions could be a significantly worse, but won't likely show up until the next survey, said Dr. William F. Jessee, president and chief executive officer of MGMA, who presented the data.

Though fully one-third of practices surveyed reported a decrease in total revenue in 2008, the news isn't all bad. Data on single-specialty groups showed some clear winners, even in these hard times. In particular, cardiologists reported a 7.9% mean increase in total revenue after operating costs. Pediatricians topped that, with a 9% increase. Family physicians reported a 2.4% mean increase.

Hardest hit were gastroenterologists, with a 5% drop in revenue. In general, the procedure-based specialties are feeling the hardest squeeze, Dr. Jessee noted.

Still, even in the sectors that have seen increases, the percentage increase in gross revenue is only a few points higher than the rising costs of staying in practice, if that much. Many practices, especially the smaller ones, are struggling.

Dr. Jessee said that group practices are tightening their belts.

On average, practices reported reducing support staff costs by 1.5%, though there were no reported significant changes in number of staff members. That means only one thing: many employees have taken pay cuts. In some cases, the doctors themselves are taking home less pay, he pointed out.

Thirty-five percent of practices have instituted hiring freezes, and 34% say they've cut operating budgets. Thirty-seven percent said that they have postponed capital expenditures.

Over one-third of the practices in the survey said that they have seen an increase in the number of uninsured patients in 2008.

Solo and physician-owned small group practices have been especially hard hit by the recession, and increasingly they are reaching out to hospitals and the large group practices for a lifeline. MGMA surveys over the last decade show clearly that America's doctors are huddling up and selling out to larger health care entities, Dr. Jessee said.

The number of MGMA member groups owned by hospitals grew by 20% during the 5-year period from 2003 to 2008, and they now comprise 10% of the organization's total membership.

During that time, the average number of physicians in MGMA member group practices increased from 16 in 2003 to 19 in 2008. The number of doctors in the average hospital-owned group rose from 64 to 76, a 19% increase. “There's a big, big trend toward consolidation,” Dr. Jessee said.

Not surprisingly, the economic downturn has affected MGMA itself.

The organization acknowledged that attendance at this year's annual meeting—roughly 2,150 paid attendees—was down 21% from its peak several years ago.

DENVER — Multispecialty group practice revenue dropped last year for the first time in a decade as practices across the country felt the impact of the recession, but primary care revenue appears relatively healthy.

The Medical Group Management Association's Cost Survey for 2009 showed a 1.9% decline in mean total medical gross revenue among multispecialty groups, as well as a 9.9% drop in volume of medical procedures (indicated by RVUs provided per patient) and an 11% decrease in total patient volume. Not surprisingly, bad debt from fee-for-service charges increased by 13%.

The 2009 report, released at the MGMA's annual conference, was based on 2008 data and so represents a snapshot of the early phase of the recession. Current conditions could be a significantly worse, but won't likely show up until the next survey, said Dr. William F. Jessee, president and chief executive officer of MGMA, who presented the data.

Though fully one-third of practices surveyed reported a decrease in total revenue in 2008, the news isn't all bad. Data on single-specialty groups showed some clear winners, even in these hard times. In particular, cardiologists reported a 7.9% mean increase in total revenue after operating costs. Pediatricians topped that, with a 9% increase. Family physicians reported a 2.4% mean increase.

Hardest hit were gastroenterologists, with a 5% drop in revenue. In general, the procedure-based specialties are feeling the hardest squeeze, Dr. Jessee noted.

Still, even in the sectors that have seen increases, the percentage increase in gross revenue is only a few points higher than the rising costs of staying in practice, if that much. Many practices, especially the smaller ones, are struggling.

Dr. Jessee said that group practices are tightening their belts.

On average, practices reported reducing support staff costs by 1.5%, though there were no reported significant changes in number of staff members. That means only one thing: many employees have taken pay cuts. In some cases, the doctors themselves are taking home less pay, he pointed out.

Thirty-five percent of practices have instituted hiring freezes, and 34% say they've cut operating budgets. Thirty-seven percent said that they have postponed capital expenditures.

Over one-third of the practices in the survey said that they have seen an increase in the number of uninsured patients in 2008.

Solo and physician-owned small group practices have been especially hard hit by the recession, and increasingly they are reaching out to hospitals and the large group practices for a lifeline. MGMA surveys over the last decade show clearly that America's doctors are huddling up and selling out to larger health care entities, Dr. Jessee said.

The number of MGMA member groups owned by hospitals grew by 20% during the 5-year period from 2003 to 2008, and they now comprise 10% of the organization's total membership.

During that time, the average number of physicians in MGMA member group practices increased from 16 in 2003 to 19 in 2008. The number of doctors in the average hospital-owned group rose from 64 to 76, a 19% increase. “There's a big, big trend toward consolidation,” Dr. Jessee said.

Not surprisingly, the economic downturn has affected MGMA itself.

The organization acknowledged that attendance at this year's annual meeting—roughly 2,150 paid attendees—was down 21% from its peak several years ago.

DENVER — Multispecialty group practice revenue dropped last year for the first time in a decade as practices across the country felt the impact of the recession, but primary care revenue appears relatively healthy.

The Medical Group Management Association's Cost Survey for 2009 showed a 1.9% decline in mean total medical gross revenue among multispecialty groups, as well as a 9.9% drop in volume of medical procedures (indicated by RVUs provided per patient) and an 11% decrease in total patient volume. Not surprisingly, bad debt from fee-for-service charges increased by 13%.

The 2009 report, released at the MGMA's annual conference, was based on 2008 data and so represents a snapshot of the early phase of the recession. Current conditions could be a significantly worse, but won't likely show up until the next survey, said Dr. William F. Jessee, president and chief executive officer of MGMA, who presented the data.

Though fully one-third of practices surveyed reported a decrease in total revenue in 2008, the news isn't all bad. Data on single-specialty groups showed some clear winners, even in these hard times. In particular, cardiologists reported a 7.9% mean increase in total revenue after operating costs. Pediatricians topped that, with a 9% increase. Family physicians reported a 2.4% mean increase.

Hardest hit were gastroenterologists, with a 5% drop in revenue. In general, the procedure-based specialties are feeling the hardest squeeze, Dr. Jessee noted.

Still, even in the sectors that have seen increases, the percentage increase in gross revenue is only a few points higher than the rising costs of staying in practice, if that much. Many practices, especially the smaller ones, are struggling.

Dr. Jessee said that group practices are tightening their belts.

On average, practices reported reducing support staff costs by 1.5%, though there were no reported significant changes in number of staff members. That means only one thing: many employees have taken pay cuts. In some cases, the doctors themselves are taking home less pay, he pointed out.

Thirty-five percent of practices have instituted hiring freezes, and 34% say they've cut operating budgets. Thirty-seven percent said that they have postponed capital expenditures.

Over one-third of the practices in the survey said that they have seen an increase in the number of uninsured patients in 2008.

Solo and physician-owned small group practices have been especially hard hit by the recession, and increasingly they are reaching out to hospitals and the large group practices for a lifeline. MGMA surveys over the last decade show clearly that America's doctors are huddling up and selling out to larger health care entities, Dr. Jessee said.

The number of MGMA member groups owned by hospitals grew by 20% during the 5-year period from 2003 to 2008, and they now comprise 10% of the organization's total membership.

During that time, the average number of physicians in MGMA member group practices increased from 16 in 2003 to 19 in 2008. The number of doctors in the average hospital-owned group rose from 64 to 76, a 19% increase. “There's a big, big trend toward consolidation,” Dr. Jessee said.

Not surprisingly, the economic downturn has affected MGMA itself.

The organization acknowledged that attendance at this year's annual meeting—roughly 2,150 paid attendees—was down 21% from its peak several years ago.

DENVER — Multispecialty group practice revenue dropped last year for the first time in a decade as practices across the country felt the impact of the recession, but primary care revenue appears relatively healthy.

The Medical Group Management Association's cost survey for 2009 showed a 1.9% decline in mean total medical gross revenue among multispecialty groups, as well as a 9.9% drop in volume of medical procedures (indicated by relative value units [RVUs] provided per patient) and an 11% decrease in total patient volume. Not surprisingly, bad debt from fee-for-service charges increased by 13%.

The 2009 report, released at the MGMA's annual conference, was based on 2008 data and so represents a snapshot of the early phase of the recession. Current conditions could be a significantly worse, but won't likely show up until the next survey, said Dr. William F. Jessee, president and chief executive officer of MGMA, who presented the data.

Though fully one-third of practices surveyed reported a decrease in total revenue in 2008, the news wasn't all bad. Data on single-specialty groups showed some clear winners, even in these hard times. In particular, cardiologists reported a 7.9% mean increase in total revenue after operating costs. Pediatricians topped that, with a 9% increase. Family physicians reported a 2.4% mean increase.

Hardest hit were gastroenterologists, with a 5% drop in revenue. In general, the procedure-based specialties are feeling the hardest squeeze, Dr. Jessee commented.

Still, even in the sectors that have seen increases, the percentage increase in gross revenue is only a few points higher than the rising costs of staying in practice, if that much. Many practices, especially the smaller ones, are struggling.

Dr. Jessee said that group practices are tightening their belts.

On average, practices reported reducing support staff costs by 1.5%, though there were no reported significant changes in number of staff members. That means only one thing: Many employees have taken pay cuts. In some cases, the doctors themselves are taking home less pay, he pointed out.

Thirty-five percent of practices have instituted hiring freezes, and 34% say they've cut operating budgets. Thirty-seven percent said that they have postponed capital expenditures.

Over one-third of the practices in the survey said that they saw an increase in the number of uninsured patients in 2008.

Solo and physician-owned small group practices have been especially hard hit by the recession, and increasingly they are reaching out to hospitals and the large group practices for a lifeline. MGMA surveys over the last decade show clearly that America's doctors are huddling up and selling out to larger health care entities, Dr. Jessee said.

The number of MGMA member groups owned by hospitals grew by 20% during the 5-year period from 2003 to 2008, and they now comprise 10% of the organization's total membership.

During that time, the average number of physicians in MGMA member group practices increased from 16 in 2003 to 19 in 2008. The number of doctors in the average hospital-owned group rose from 64 to 76, a 19% increase. “There's a big, big trend toward consolidation,” Dr. Jessee said.

Not surprisingly, the economic downturn has also affected MGMA itself. The organization acknowledged that attendance at this year's annual meeting—roughly 2,150 paid attendees—was down 21% from its peak several years ago.

DENVER — Multispecialty group practice revenue dropped last year for the first time in a decade as practices across the country felt the impact of the recession, but primary care revenue appears relatively healthy.

The Medical Group Management Association's cost survey for 2009 showed a 1.9% decline in mean total medical gross revenue among multispecialty groups, as well as a 9.9% drop in volume of medical procedures (indicated by relative value units [RVUs] provided per patient) and an 11% decrease in total patient volume. Not surprisingly, bad debt from fee-for-service charges increased by 13%.

The 2009 report, released at the MGMA's annual conference, was based on 2008 data and so represents a snapshot of the early phase of the recession. Current conditions could be a significantly worse, but won't likely show up until the next survey, said Dr. William F. Jessee, president and chief executive officer of MGMA, who presented the data.

Though fully one-third of practices surveyed reported a decrease in total revenue in 2008, the news wasn't all bad. Data on single-specialty groups showed some clear winners, even in these hard times. In particular, cardiologists reported a 7.9% mean increase in total revenue after operating costs. Pediatricians topped that, with a 9% increase. Family physicians reported a 2.4% mean increase.

Hardest hit were gastroenterologists, with a 5% drop in revenue. In general, the procedure-based specialties are feeling the hardest squeeze, Dr. Jessee commented.

Still, even in the sectors that have seen increases, the percentage increase in gross revenue is only a few points higher than the rising costs of staying in practice, if that much. Many practices, especially the smaller ones, are struggling.

Dr. Jessee said that group practices are tightening their belts.

On average, practices reported reducing support staff costs by 1.5%, though there were no reported significant changes in number of staff members. That means only one thing: Many employees have taken pay cuts. In some cases, the doctors themselves are taking home less pay, he pointed out.

Thirty-five percent of practices have instituted hiring freezes, and 34% say they've cut operating budgets. Thirty-seven percent said that they have postponed capital expenditures.

Over one-third of the practices in the survey said that they saw an increase in the number of uninsured patients in 2008.

Solo and physician-owned small group practices have been especially hard hit by the recession, and increasingly they are reaching out to hospitals and the large group practices for a lifeline. MGMA surveys over the last decade show clearly that America's doctors are huddling up and selling out to larger health care entities, Dr. Jessee said.

The number of MGMA member groups owned by hospitals grew by 20% during the 5-year period from 2003 to 2008, and they now comprise 10% of the organization's total membership.

During that time, the average number of physicians in MGMA member group practices increased from 16 in 2003 to 19 in 2008. The number of doctors in the average hospital-owned group rose from 64 to 76, a 19% increase. “There's a big, big trend toward consolidation,” Dr. Jessee said.

Not surprisingly, the economic downturn has also affected MGMA itself. The organization acknowledged that attendance at this year's annual meeting—roughly 2,150 paid attendees—was down 21% from its peak several years ago.

DENVER — Multispecialty group practice revenue dropped last year for the first time in a decade as practices across the country felt the impact of the recession, but primary care revenue appears relatively healthy.

The Medical Group Management Association's cost survey for 2009 showed a 1.9% decline in mean total medical gross revenue among multispecialty groups, as well as a 9.9% drop in volume of medical procedures (indicated by relative value units [RVUs] provided per patient) and an 11% decrease in total patient volume. Not surprisingly, bad debt from fee-for-service charges increased by 13%.

The 2009 report, released at the MGMA's annual conference, was based on 2008 data and so represents a snapshot of the early phase of the recession. Current conditions could be a significantly worse, but won't likely show up until the next survey, said Dr. William F. Jessee, president and chief executive officer of MGMA, who presented the data.

Though fully one-third of practices surveyed reported a decrease in total revenue in 2008, the news wasn't all bad. Data on single-specialty groups showed some clear winners, even in these hard times. In particular, cardiologists reported a 7.9% mean increase in total revenue after operating costs. Pediatricians topped that, with a 9% increase. Family physicians reported a 2.4% mean increase.

Hardest hit were gastroenterologists, with a 5% drop in revenue. In general, the procedure-based specialties are feeling the hardest squeeze, Dr. Jessee commented.

Still, even in the sectors that have seen increases, the percentage increase in gross revenue is only a few points higher than the rising costs of staying in practice, if that much. Many practices, especially the smaller ones, are struggling.

Dr. Jessee said that group practices are tightening their belts.

On average, practices reported reducing support staff costs by 1.5%, though there were no reported significant changes in number of staff members. That means only one thing: Many employees have taken pay cuts. In some cases, the doctors themselves are taking home less pay, he pointed out.

Thirty-five percent of practices have instituted hiring freezes, and 34% say they've cut operating budgets. Thirty-seven percent said that they have postponed capital expenditures.

Over one-third of the practices in the survey said that they saw an increase in the number of uninsured patients in 2008.

Solo and physician-owned small group practices have been especially hard hit by the recession, and increasingly they are reaching out to hospitals and the large group practices for a lifeline. MGMA surveys over the last decade show clearly that America's doctors are huddling up and selling out to larger health care entities, Dr. Jessee said.

The number of MGMA member groups owned by hospitals grew by 20% during the 5-year period from 2003 to 2008, and they now comprise 10% of the organization's total membership.

During that time, the average number of physicians in MGMA member group practices increased from 16 in 2003 to 19 in 2008. The number of doctors in the average hospital-owned group rose from 64 to 76, a 19% increase. “There's a big, big trend toward consolidation,” Dr. Jessee said.

Not surprisingly, the economic downturn has also affected MGMA itself. The organization acknowledged that attendance at this year's annual meeting—roughly 2,150 paid attendees—was down 21% from its peak several years ago.

WASHINGTON — Search engine giant Google has joined software giant Microsoft in an attempt to revolutionize health care information technology, one patient at a time.

Google launched Google Health this spring with an aim of establishing itself as the leading repository of personal health records (PHR). Google is also positioning itself as a primary clearinghouse for clinical information, self-care tools, and provider ratings to help patients make educated health care decisions.

Google Health emerged just as the smoke began to clear from Microsoft's launch of its own HealthVault PHR platform last fall.

Both companies see individual patients, not health care systems, as the primary locus of change for health care information technology, and both provide individuals with secure but user-friendly systems for aggregating all of their health care records, data, diagnostic images, laboratory results, and medical histories. They hope to put an end to the fragmentation, duplication, and lack of portability that characterize paper-based health record-keeping.

Executives at both HealthVault and Google Health said that they believe digitally enabled patients will help push more doctors to implement electronic medical records systems in their offices.

Todd Wiseman, head of Google's Federal Enterprise Team, says the creation of Google Health was a natural move. "We now have more than 1 billion people worldwide using Google every day. Google is the No. 1 search engine for health information, and health topics are a top search category for Google," he said at the fifth annual World Health Care Congress.

Google Health will eventually enable people all over the country to store their PHRs and allow them to make their own determinations about who may have access to those records. Users can also store medical contacts and other relevant information.

"Users should have easy access to their medical records, and should be able to act on their data. Medical records should follow the patient and exist in an environment of interoperability, portability, privacy, and security," Mr. Wiseman said. "We don't hold our users' data hostage."

The system can automatically import physician reports, prescription history, and lab results. Eventually, it will enable people to schedule appointments, refill prescriptions, and employ personal health and wellness tools, Mr. Wiseman said. Google Health's PHR function also will be enriched with specialized health-oriented search functions, clinical trial matching, and a host of other health management tools, all of which can be integrated with a user's Gmail e-mail account.

Google Health will not charge people to store PHRs; likewise, doctors will be able to access their patients' PHRs—with patient permission, of course—at no cost.

"We don't have any plans for ads within the Google Health product," Mr. Wiseman said. "We see it as a way to drive more Google search traffic." The search returns, of course, will arrive with ads and sponsored placements (just like every Google search), but he stressed that the PHR side of things will remain free of commercials.

Google is currently running a pilot field test of the Google Health system in partnership with the Cleveland Clinic. "We're 2 months into that, and we have 1,600 Cleveland Clinic patients storing their PHRs right now. This will go up to about 10,000. We're testing the process of data sharing in a live clinical-care delivery setting, with real patients and real doctors. The goal is simply proof of concept. At Google, we strongly believe in testing things."

Mr. Wiseman pointed out that Google has significant advantages over other companies vying for a piece of the evolving PHR market. For one, the company is wholly independent and not tethered to any health care plan or provider system, so a Google Health PHR is completely portable. Users would be able to access their records even if they change health plans, jobs, or even countries.

Mr. Wiseman stressed that, as a company, Google is a neutral stakeholder as far as how someone uses their PHR, which is different from PHR systems tied to specific health plans. "We stand by the user and the user only."

Google has one more major advantage: massive data storage capacity.

"We can store and manage a LOT of data," Mr. Wiseman said, noting that Google already gives its Gmail users six gigabytes of e-mail storage capacity. "That's a lot. And when you think about storing x-rays, MRIs, and other things like that, there will be a big need for memory."

Google Health essentially is head-on competition for Microsoft's HealthVault, which has been up and running since last fall. While Microsoft has been involved in health care IT solutions for hospitals and health plans for more than a decade, its PHR efforts are fairly new, said George Scriban, senior product manager for HealthVault.

In an interview, Mr. Scriban said HealthVault, which is also free to consumers, tries to solve one of the most frustrating health issues for ordinary people: fragmentation.

"Fragmentation of delivery of care has a lot to do with fragmentation of someone's health care identity. Everybody's health care identity is spread around in little slices in different sectors. The employer has some information, various doctors have others, hospitals and payers and pharmacies have still others. The ideal is to have all one's information, presentable and portable and useful to any and all providers," Mr. Scriban said.

Essentially, HealthVault is a consumer-controlled hub for gathering and controlling information from various sectors of a person's "health care ecosystem."

Mr. Scriban said that he understands that some physicians get nervous at the thought of patients in control of their own medical records. But he believes that systems like HealthVault and Google Health are really just systematizing what already happens informally.

"When a patient gets a referral from one doctor to another, it is really that patient who acts as an information transporter, telling the new doctor his or her medical history, medication use, and in some cases actually transferring paper records," he said.

HealthVault tries to standardize, stabilize, and formalize that process, and Mr. Scriban contends that this will reduce errors, prevent loss of important information, eliminate redundancy, and give physicians a fuller picture of their patients' health. He added that HealthVault is being designed to interface with many different electronic medical records systems. HealthVault and Google Health are similar in many respects.

"Both are backed by large companies with a lot of resources; [both companies] have looked at the same problem and arrived at similar conclusions. One conclusion is that you cannot revolutionize health care in one big step. The other is that the consumer is really the agent of change in all of this," Mr. Scriban said.

Still, there are some differences. He stressed that Microsoft is primarily focused on enabling people to manage their health information, and less engaged in providing self-care tools, something that Google is pursuing.

Although it is natural to view the current landscape as a clash of the IT titans, Mr. Scriban said he thinks that view is somewhat overstated.

"In the end, we're really glad that Google has joined us in attempting to deal with the problems of personal health information management. I don't think it's really a Google vs. Microsoft scenario. It's more like Google, Microsoft, and all of us who are involved in PHRs and EHRs versus paper!"

Microsoft recently partnered with Kaiser Permanente, an integrated health plan with more than 8 million members, to test the transfer of data from Kaiser's personal health record into HealthVault. The pilot project, launched last month, is open to Kaiser's 159,000 employees. The idea is to combine the clinical data entered by Kaiser physicians, which is available in the Kaiser personal health record, with patient-entered health information and clinical information from providers outside of the Kaiser system.

Kaiser officials plan to reevaluate the pilot later in the year before expanding it to Kaiser members.

Google's Mr. Wiseman said it is particularly important to create alliances with health plans. "A lot of people won't use Google Health unless their health plans support it." Google's other major focus is on consumer decision support tools.

Among Google Health's new partners is HealthGrades, the private company that has quietly emerged as the leader in online physician and hospital ratings. HealthGrades uses publicly available data on quality outcomes based on 32 standardized procedures and health conditions to grade physician and hospital performance. The ratings parameters are based on work done by the National Quality Forum.

"HealthGrades' mission is to guide Americans to better health care," said Dr. Samantha Collier, chief medical officer of HealthGrades. "There are enormous gaps between what we know we could do and should do, and what actually happens in health care. There are vast gaps between the best and worst hospitals and clinics."

Currently, Web users seeking HealthGrades ratings for a doctor or hospital must pay a fee. Under the partnership agreement, Google Health users would have free access to the ratings.

Though the specifics have not yet been worked out, the idea is that Google Health users searching for doctors or clinics would obtain a listing of the top 10 appropriate practitioners locally. Each listing would contain basic contact information, as well as a "more" button, clicking on which would allow the user to see the full HealthGrades profile for that physician or hospital, including any disciplinary actions or malpractice cases, past or pending.

At issue, of course, is how Google and HealthGrades will determine which practitioners and facilities show up on the top 10 list for a particular search. Dr. Collier and Mr. Wiseman said that initially the order of rank will be based on Google's standard model, which lists the most trafficked sites highest. The rankings would not be based on the HealthGrades scores.

That seems somewhat contradictory to the company's stated mission of trying to steer patients to the doctors and hospitals with the best quality ratings, not simply the ones with the most Web hits. Mr. Wiseman said that at some point the model might change to one in which the listings were based on HealthGrades scores, but he would not comment further.

From a physician's perspective, it is difficult to say which mode of determining the listings would be preferable. On one hand, Web site traffic has little clinical relevance, and all but rules out doctors who do not have Web sites. On the other hand, rankings based on HealthGrades scores would only be as fair and reasonable as the scores themselves.

Google Health and HealthVault are putting online patient health records to the test. ©2008 Microsoft Corporation/Google Health

WASHINGTON — Search engine giant Google has joined software giant Microsoft in an attempt to revolutionize health care information technology, one patient at a time.

Google launched Google Health this spring with an aim of establishing itself as the leading repository of personal health records (PHR). Google is also positioning itself as a primary clearinghouse for clinical information, self-care tools, and provider ratings to help patients make educated health care decisions.

Google Health emerged just as the smoke began to clear from Microsoft's launch of its own HealthVault PHR platform last fall.

Both companies see individual patients, not health care systems, as the primary locus of change for health care information technology, and both provide individuals with secure but user-friendly systems for aggregating all of their health care records, data, diagnostic images, laboratory results, and medical histories. They hope to put an end to the fragmentation, duplication, and lack of portability that characterize paper-based health record-keeping.

Executives at both HealthVault and Google Health said that they believe digitally enabled patients will help push more doctors to implement electronic medical records systems in their offices.

Todd Wiseman, head of Google's Federal Enterprise Team, says the creation of Google Health was a natural move. "We now have more than 1 billion people worldwide using Google every day. Google is the No. 1 search engine for health information, and health topics are a top search category for Google," he said at the fifth annual World Health Care Congress.

Google Health will eventually enable people all over the country to store their PHRs and allow them to make their own determinations about who may have access to those records. Users can also store medical contacts and other relevant information.

"Users should have easy access to their medical records, and should be able to act on their data. Medical records should follow the patient and exist in an environment of interoperability, portability, privacy, and security," Mr. Wiseman said. "We don't hold our users' data hostage."

The system can automatically import physician reports, prescription history, and lab results. Eventually, it will enable people to schedule appointments, refill prescriptions, and employ personal health and wellness tools, Mr. Wiseman said. Google Health's PHR function also will be enriched with specialized health-oriented search functions, clinical trial matching, and a host of other health management tools, all of which can be integrated with a user's Gmail e-mail account.

Google Health will not charge people to store PHRs; likewise, doctors will be able to access their patients' PHRs—with patient permission, of course—at no cost.

"We don't have any plans for ads within the Google Health product," Mr. Wiseman said. "We see it as a way to drive more Google search traffic." The search returns, of course, will arrive with ads and sponsored placements (just like every Google search), but he stressed that the PHR side of things will remain free of commercials.

Google is currently running a pilot field test of the Google Health system in partnership with the Cleveland Clinic. "We're 2 months into that, and we have 1,600 Cleveland Clinic patients storing their PHRs right now. This will go up to about 10,000. We're testing the process of data sharing in a live clinical-care delivery setting, with real patients and real doctors. The goal is simply proof of concept. At Google, we strongly believe in testing things."

Mr. Wiseman pointed out that Google has significant advantages over other companies vying for a piece of the evolving PHR market. For one, the company is wholly independent and not tethered to any health care plan or provider system, so a Google Health PHR is completely portable. Users would be able to access their records even if they change health plans, jobs, or even countries.

Mr. Wiseman stressed that, as a company, Google is a neutral stakeholder as far as how someone uses their PHR, which is different from PHR systems tied to specific health plans. "We stand by the user and the user only."

Google has one more major advantage: massive data storage capacity.

"We can store and manage a LOT of data," Mr. Wiseman said, noting that Google already gives its Gmail users six gigabytes of e-mail storage capacity. "That's a lot. And when you think about storing x-rays, MRIs, and other things like that, there will be a big need for memory."

Google Health essentially is head-on competition for Microsoft's HealthVault, which has been up and running since last fall. While Microsoft has been involved in health care IT solutions for hospitals and health plans for more than a decade, its PHR efforts are fairly new, said George Scriban, senior product manager for HealthVault.

In an interview, Mr. Scriban said HealthVault, which is also free to consumers, tries to solve one of the most frustrating health issues for ordinary people: fragmentation.

"Fragmentation of delivery of care has a lot to do with fragmentation of someone's health care identity. Everybody's health care identity is spread around in little slices in different sectors. The employer has some information, various doctors have others, hospitals and payers and pharmacies have still others. The ideal is to have all one's information, presentable and portable and useful to any and all providers," Mr. Scriban said.

Essentially, HealthVault is a consumer-controlled hub for gathering and controlling information from various sectors of a person's "health care ecosystem."

Mr. Scriban said that he understands that some physicians get nervous at the thought of patients in control of their own medical records. But he believes that systems like HealthVault and Google Health are really just systematizing what already happens informally.

"When a patient gets a referral from one doctor to another, it is really that patient who acts as an information transporter, telling the new doctor his or her medical history, medication use, and in some cases actually transferring paper records," he said.

HealthVault tries to standardize, stabilize, and formalize that process, and Mr. Scriban contends that this will reduce errors, prevent loss of important information, eliminate redundancy, and give physicians a fuller picture of their patients' health. He added that HealthVault is being designed to interface with many different electronic medical records systems. HealthVault and Google Health are similar in many respects.

"Both are backed by large companies with a lot of resources; [both companies] have looked at the same problem and arrived at similar conclusions. One conclusion is that you cannot revolutionize health care in one big step. The other is that the consumer is really the agent of change in all of this," Mr. Scriban said.

Still, there are some differences. He stressed that Microsoft is primarily focused on enabling people to manage their health information, and less engaged in providing self-care tools, something that Google is pursuing.

Although it is natural to view the current landscape as a clash of the IT titans, Mr. Scriban said he thinks that view is somewhat overstated.

"In the end, we're really glad that Google has joined us in attempting to deal with the problems of personal health information management. I don't think it's really a Google vs. Microsoft scenario. It's more like Google, Microsoft, and all of us who are involved in PHRs and EHRs versus paper!"

Microsoft recently partnered with Kaiser Permanente, an integrated health plan with more than 8 million members, to test the transfer of data from Kaiser's personal health record into HealthVault. The pilot project, launched last month, is open to Kaiser's 159,000 employees. The idea is to combine the clinical data entered by Kaiser physicians, which is available in the Kaiser personal health record, with patient-entered health information and clinical information from providers outside of the Kaiser system.

Kaiser officials plan to reevaluate the pilot later in the year before expanding it to Kaiser members.

Google's Mr. Wiseman said it is particularly important to create alliances with health plans. "A lot of people won't use Google Health unless their health plans support it." Google's other major focus is on consumer decision support tools.

Among Google Health's new partners is HealthGrades, the private company that has quietly emerged as the leader in online physician and hospital ratings. HealthGrades uses publicly available data on quality outcomes based on 32 standardized procedures and health conditions to grade physician and hospital performance. The ratings parameters are based on work done by the National Quality Forum.

"HealthGrades' mission is to guide Americans to better health care," said Dr. Samantha Collier, chief medical officer of HealthGrades. "There are enormous gaps between what we know we could do and should do, and what actually happens in health care. There are vast gaps between the best and worst hospitals and clinics."

Currently, Web users seeking HealthGrades ratings for a doctor or hospital must pay a fee. Under the partnership agreement, Google Health users would have free access to the ratings.

Though the specifics have not yet been worked out, the idea is that Google Health users searching for doctors or clinics would obtain a listing of the top 10 appropriate practitioners locally. Each listing would contain basic contact information, as well as a "more" button, clicking on which would allow the user to see the full HealthGrades profile for that physician or hospital, including any disciplinary actions or malpractice cases, past or pending.

At issue, of course, is how Google and HealthGrades will determine which practitioners and facilities show up on the top 10 list for a particular search. Dr. Collier and Mr. Wiseman said that initially the order of rank will be based on Google's standard model, which lists the most trafficked sites highest. The rankings would not be based on the HealthGrades scores.

That seems somewhat contradictory to the company's stated mission of trying to steer patients to the doctors and hospitals with the best quality ratings, not simply the ones with the most Web hits. Mr. Wiseman said that at some point the model might change to one in which the listings were based on HealthGrades scores, but he would not comment further.

From a physician's perspective, it is difficult to say which mode of determining the listings would be preferable. On one hand, Web site traffic has little clinical relevance, and all but rules out doctors who do not have Web sites. On the other hand, rankings based on HealthGrades scores would only be as fair and reasonable as the scores themselves.

Google Health and HealthVault are putting online patient health records to the test. ©2008 Microsoft Corporation/Google Health

WASHINGTON — Search engine giant Google has joined software giant Microsoft in an attempt to revolutionize health care information technology, one patient at a time.

Google launched Google Health this spring with an aim of establishing itself as the leading repository of personal health records (PHR). Google is also positioning itself as a primary clearinghouse for clinical information, self-care tools, and provider ratings to help patients make educated health care decisions.

Google Health emerged just as the smoke began to clear from Microsoft's launch of its own HealthVault PHR platform last fall.

Both companies see individual patients, not health care systems, as the primary locus of change for health care information technology, and both provide individuals with secure but user-friendly systems for aggregating all of their health care records, data, diagnostic images, laboratory results, and medical histories. They hope to put an end to the fragmentation, duplication, and lack of portability that characterize paper-based health record-keeping.

Executives at both HealthVault and Google Health said that they believe digitally enabled patients will help push more doctors to implement electronic medical records systems in their offices.

Todd Wiseman, head of Google's Federal Enterprise Team, says the creation of Google Health was a natural move. "We now have more than 1 billion people worldwide using Google every day. Google is the No. 1 search engine for health information, and health topics are a top search category for Google," he said at the fifth annual World Health Care Congress.

Google Health will eventually enable people all over the country to store their PHRs and allow them to make their own determinations about who may have access to those records. Users can also store medical contacts and other relevant information.

"Users should have easy access to their medical records, and should be able to act on their data. Medical records should follow the patient and exist in an environment of interoperability, portability, privacy, and security," Mr. Wiseman said. "We don't hold our users' data hostage."

The system can automatically import physician reports, prescription history, and lab results. Eventually, it will enable people to schedule appointments, refill prescriptions, and employ personal health and wellness tools, Mr. Wiseman said. Google Health's PHR function also will be enriched with specialized health-oriented search functions, clinical trial matching, and a host of other health management tools, all of which can be integrated with a user's Gmail e-mail account.

Google Health will not charge people to store PHRs; likewise, doctors will be able to access their patients' PHRs—with patient permission, of course—at no cost.

"We don't have any plans for ads within the Google Health product," Mr. Wiseman said. "We see it as a way to drive more Google search traffic." The search returns, of course, will arrive with ads and sponsored placements (just like every Google search), but he stressed that the PHR side of things will remain free of commercials.

Google is currently running a pilot field test of the Google Health system in partnership with the Cleveland Clinic. "We're 2 months into that, and we have 1,600 Cleveland Clinic patients storing their PHRs right now. This will go up to about 10,000. We're testing the process of data sharing in a live clinical-care delivery setting, with real patients and real doctors. The goal is simply proof of concept. At Google, we strongly believe in testing things."

Mr. Wiseman pointed out that Google has significant advantages over other companies vying for a piece of the evolving PHR market. For one, the company is wholly independent and not tethered to any health care plan or provider system, so a Google Health PHR is completely portable. Users would be able to access their records even if they change health plans, jobs, or even countries.

Mr. Wiseman stressed that, as a company, Google is a neutral stakeholder as far as how someone uses their PHR, which is different from PHR systems tied to specific health plans. "We stand by the user and the user only."

Google has one more major advantage: massive data storage capacity.

"We can store and manage a LOT of data," Mr. Wiseman said, noting that Google already gives its Gmail users six gigabytes of e-mail storage capacity. "That's a lot. And when you think about storing x-rays, MRIs, and other things like that, there will be a big need for memory."

Google Health essentially is head-on competition for Microsoft's HealthVault, which has been up and running since last fall. While Microsoft has been involved in health care IT solutions for hospitals and health plans for more than a decade, its PHR efforts are fairly new, said George Scriban, senior product manager for HealthVault.

In an interview, Mr. Scriban said HealthVault, which is also free to consumers, tries to solve one of the most frustrating health issues for ordinary people: fragmentation.

"Fragmentation of delivery of care has a lot to do with fragmentation of someone's health care identity. Everybody's health care identity is spread around in little slices in different sectors. The employer has some information, various doctors have others, hospitals and payers and pharmacies have still others. The ideal is to have all one's information, presentable and portable and useful to any and all providers," Mr. Scriban said.

Essentially, HealthVault is a consumer-controlled hub for gathering and controlling information from various sectors of a person's "health care ecosystem."

Mr. Scriban said that he understands that some physicians get nervous at the thought of patients in control of their own medical records. But he believes that systems like HealthVault and Google Health are really just systematizing what already happens informally.

"When a patient gets a referral from one doctor to another, it is really that patient who acts as an information transporter, telling the new doctor his or her medical history, medication use, and in some cases actually transferring paper records," he said.

HealthVault tries to standardize, stabilize, and formalize that process, and Mr. Scriban contends that this will reduce errors, prevent loss of important information, eliminate redundancy, and give physicians a fuller picture of their patients' health. He added that HealthVault is being designed to interface with many different electronic medical records systems. HealthVault and Google Health are similar in many respects.

"Both are backed by large companies with a lot of resources; [both companies] have looked at the same problem and arrived at similar conclusions. One conclusion is that you cannot revolutionize health care in one big step. The other is that the consumer is really the agent of change in all of this," Mr. Scriban said.

Still, there are some differences. He stressed that Microsoft is primarily focused on enabling people to manage their health information, and less engaged in providing self-care tools, something that Google is pursuing.

Although it is natural to view the current landscape as a clash of the IT titans, Mr. Scriban said he thinks that view is somewhat overstated.

"In the end, we're really glad that Google has joined us in attempting to deal with the problems of personal health information management. I don't think it's really a Google vs. Microsoft scenario. It's more like Google, Microsoft, and all of us who are involved in PHRs and EHRs versus paper!"

Microsoft recently partnered with Kaiser Permanente, an integrated health plan with more than 8 million members, to test the transfer of data from Kaiser's personal health record into HealthVault. The pilot project, launched last month, is open to Kaiser's 159,000 employees. The idea is to combine the clinical data entered by Kaiser physicians, which is available in the Kaiser personal health record, with patient-entered health information and clinical information from providers outside of the Kaiser system.

Kaiser officials plan to reevaluate the pilot later in the year before expanding it to Kaiser members.

Google's Mr. Wiseman said it is particularly important to create alliances with health plans. "A lot of people won't use Google Health unless their health plans support it." Google's other major focus is on consumer decision support tools.

Among Google Health's new partners is HealthGrades, the private company that has quietly emerged as the leader in online physician and hospital ratings. HealthGrades uses publicly available data on quality outcomes based on 32 standardized procedures and health conditions to grade physician and hospital performance. The ratings parameters are based on work done by the National Quality Forum.

"HealthGrades' mission is to guide Americans to better health care," said Dr. Samantha Collier, chief medical officer of HealthGrades. "There are enormous gaps between what we know we could do and should do, and what actually happens in health care. There are vast gaps between the best and worst hospitals and clinics."

Currently, Web users seeking HealthGrades ratings for a doctor or hospital must pay a fee. Under the partnership agreement, Google Health users would have free access to the ratings.

Though the specifics have not yet been worked out, the idea is that Google Health users searching for doctors or clinics would obtain a listing of the top 10 appropriate practitioners locally. Each listing would contain basic contact information, as well as a "more" button, clicking on which would allow the user to see the full HealthGrades profile for that physician or hospital, including any disciplinary actions or malpractice cases, past or pending.

At issue, of course, is how Google and HealthGrades will determine which practitioners and facilities show up on the top 10 list for a particular search. Dr. Collier and Mr. Wiseman said that initially the order of rank will be based on Google's standard model, which lists the most trafficked sites highest. The rankings would not be based on the HealthGrades scores.

That seems somewhat contradictory to the company's stated mission of trying to steer patients to the doctors and hospitals with the best quality ratings, not simply the ones with the most Web hits. Mr. Wiseman said that at some point the model might change to one in which the listings were based on HealthGrades scores, but he would not comment further.

From a physician's perspective, it is difficult to say which mode of determining the listings would be preferable. On one hand, Web site traffic has little clinical relevance, and all but rules out doctors who do not have Web sites. On the other hand, rankings based on HealthGrades scores would only be as fair and reasonable as the scores themselves.

Google Health and HealthVault are putting online patient health records to the test. ©2008 Microsoft Corporation/Google Health

WASHINGTON — If you've been thinking about implementing an electronic health record system but are daunted by the cost and complexity, you may have an untapped ally: your local hospital.

Many hospitals across the country have large and often untapped financial endowments for expansion of electronic health records (EHRs), to say nothing of strong technical support and considerable volume purchasing clout. As they compete for the allegiance of community-based physicians, some hospitals are finding that they can generate considerable goodwill by extending a helping hand to primary care doctors who want to digitize their practices.

“Doctors should contact the business development and community outreach offices at their local hospitals, and ask what they can do to help facilitate EHR adoption, advised Dr. Todd Rothenhaus, chief medical information officer for Caritas Christi Healthcare Systems, a six-hospital network in eastern Massachusetts.

Speaking at the fifth annual World Health Care Congress, Dr. Rothenhaus said community physicians are often pleasantly surprised to find out how much assistance they can obtain from area hospitals.

Nearly all of the nation's hospitals now have some form of EHR system in place. But broader adoption in solo and small group practices has been notoriously slow, a fact that vexes health care policy makers, hospital system administrators, and insurers who believe firmly that EHRs are the key to improving health care delivery.

To help remove some of the roadblocks to broader adoption, Congress modified the Stark antikickback regulations, creating “safe harbors” that enable hospitals to pay up to 85% of the EHR software costs for physicians practicing in their catchment areas.

“That's pretty good. And further, as hospitals we can also get volume discounts on hardware, so there's an extra 10%–15% savings,” said Dr. Rothenhaus.

With an actual example from the Caritas Christi system, he explained that a two-physician, one-nurse practice going from paper records to full EHR on its own would spend roughly $28,000 for hardware, $25,000 for software, $1,500 for training, $4,500 per year for software maintenance, and $2,400 for a software support contract. The total would be over $61,000 in the first year.

With the help of a local Caritas Christi hospital, the hardware cost drops to $25,000, the software costs the practice only $3,375, the training goes down to $1,200, the software maintenance is only $810, and the support package goes down to $2,160, for a final cost of just over $42,545.

While that's hardly chump change, it does put full EHR implementation within reach of more small practices. Dr. Rothenhaus said the savings can be even greater for practices that want to purchase more costly software systems to read and store ultrasounds, echocardiograms, and other data-intensive diagnostic images.

There are nonfiscal advantages to working with a local hospital, Dr. Rothenhaus said. For one, you gain access to hospital-affiliated technicians and analysts who are usually geographically close to the practice, as opposed to anonymous tech support that might be in another state or even another country. Hospital-based IT analysts tend to be well versed in a wide range of applications, system designs, and software packages, so they can be of great help in choosing and configuring the right system for a given practice, he said.

In addition, hospitals usually have strong relationships with equipment and software vendors; not only do they get better prices on support packages, they also get faster and more attentive help when something goes wrong.

Dr. Rothenhaus said Caritas Christi has received roughly $6 million in grants from Blue Cross/Blue Shield, Harvard Pilgrim Health Systems, and other organizations interested in pushing EHR out into the trenches of community-based health care. This money is specifically earmarked for offsetting the hardware and software costs for doctors. “I cannot imagine we are the only ones doing this,” he joked, noting that in many parts of the country, smaller hospital systems are competing fiercely for patient referral streams from physicians in their communities.

The Stark laws expressedly prohibit any sort of direct financial inducements for referrals, hence there is no obligation for a physician who accepts EHR help to refer patients to that hospital. But hospital administrators recognize that they're much more likely to win the favor of community-based doctors if they try to help doctors deal with the challenges of running a solo or small group practice.

The hospitals themselves benefit from a well-wired network of doctors in their communities. For one, it makes it far easier to ensure that all patients' records make it back to the primary care physician. This, hospital administrators believe, will improve care, reduce medical errors, and save money by reducing duplicative tests.

Once physicians go electronic, they discover many benefits, said Charles Parker, vice president and chief technology officer for Masspro, a health care performance improvement organization founded by the Massachusetts Medical Society. “In 99% of clinics, you can see return on investment in EHR within 2 years. And in some best cases, you see ROI in 90 days.”

In studying physician practices in Massachusetts, he said the big savings come from reduced need for transcription services, fewer redundant lab tests, swifter claims processing, and fewer days for claims in accounts receivable. He also noted that Medicare and Medicaid in his state include financial incentives for physicians to comply with formulary guidelines, and this is far easier to do and to document in an EHR-based office.

Doctors using EHRs also spend, on average, less time on the phone with patients, and staffers spend markedly less time tracking down lost records or missing bits of information. “All the information is always at everyones' fingertips,” Mr. Parker said.

Participation in pay-for-performance plans also requires digitized information, and some of these plans will help foot the bill for physicians to implement EHRs.

Mr. Parker, and many other EHR advocates, believe EHRs will increasingly become a central feature in the “medical home” construct, which is now a very hot idea among health plan administrators and big employers.

He noted that the National Business Coalition on Health's widely touted Bridges to Excellence program will be preferentially rewarding clinics that meet their definition of a medical home. Electronic capabilities are part of those criteria. He said that he believes that incentive structure may very well be the strongest incentive to move primary care physicians to embrace EHRs, and he called on vendors to pay more attention to this feature.

“You need to enable doctors to get the medical home assignation at the end of the process. You need to enable them to realize real revenue increases as a result, or there's simply no incentive. EHR companies are usually only focused on selling EHRs, but they fail to attend to the full-blown aspects of practice assessment and care redesign,” he said. “EHRs are really a tool for practice redesign. You really can improve the efficiency of care.”

WASHINGTON — If you've been thinking about implementing an electronic health record system but are daunted by the cost and complexity, you may have an untapped ally: your local hospital.

Many hospitals across the country have large and often untapped financial endowments for expansion of electronic health records (EHRs), to say nothing of strong technical support and considerable volume purchasing clout. As they compete for the allegiance of community-based physicians, some hospitals are finding that they can generate considerable goodwill by extending a helping hand to primary care doctors who want to digitize their practices.

“Doctors should contact the business development and community outreach offices at their local hospitals, and ask what they can do to help facilitate EHR adoption, advised Dr. Todd Rothenhaus, chief medical information officer for Caritas Christi Healthcare Systems, a six-hospital network in eastern Massachusetts.

Speaking at the fifth annual World Health Care Congress, Dr. Rothenhaus said community physicians are often pleasantly surprised to find out how much assistance they can obtain from area hospitals.

Nearly all of the nation's hospitals now have some form of EHR system in place. But broader adoption in solo and small group practices has been notoriously slow, a fact that vexes health care policy makers, hospital system administrators, and insurers who believe firmly that EHRs are the key to improving health care delivery.

To help remove some of the roadblocks to broader adoption, Congress modified the Stark antikickback regulations, creating “safe harbors” that enable hospitals to pay up to 85% of the EHR software costs for physicians practicing in their catchment areas.

“That's pretty good. And further, as hospitals we can also get volume discounts on hardware, so there's an extra 10%–15% savings,” said Dr. Rothenhaus.

With an actual example from the Caritas Christi system, he explained that a two-physician, one-nurse practice going from paper records to full EHR on its own would spend roughly $28,000 for hardware, $25,000 for software, $1,500 for training, $4,500 per year for software maintenance, and $2,400 for a software support contract. The total would be over $61,000 in the first year.

With the help of a local Caritas Christi hospital, the hardware cost drops to $25,000, the software costs the practice only $3,375, the training goes down to $1,200, the software maintenance is only $810, and the support package goes down to $2,160, for a final cost of just over $42,545.

While that's hardly chump change, it does put full EHR implementation within reach of more small practices. Dr. Rothenhaus said the savings can be even greater for practices that want to purchase more costly software systems to read and store ultrasounds, echocardiograms, and other data-intensive diagnostic images.

There are nonfiscal advantages to working with a local hospital, Dr. Rothenhaus said. For one, you gain access to hospital-affiliated technicians and analysts who are usually geographically close to the practice, as opposed to anonymous tech support that might be in another state or even another country. Hospital-based IT analysts tend to be well versed in a wide range of applications, system designs, and software packages, so they can be of great help in choosing and configuring the right system for a given practice, he said.

In addition, hospitals usually have strong relationships with equipment and software vendors; not only do they get better prices on support packages, they also get faster and more attentive help when something goes wrong.

Dr. Rothenhaus said Caritas Christi has received roughly $6 million in grants from Blue Cross/Blue Shield, Harvard Pilgrim Health Systems, and other organizations interested in pushing EHR out into the trenches of community-based health care. This money is specifically earmarked for offsetting the hardware and software costs for doctors. “I cannot imagine we are the only ones doing this,” he joked, noting that in many parts of the country, smaller hospital systems are competing fiercely for patient referral streams from physicians in their communities.

The Stark laws expressedly prohibit any sort of direct financial inducements for referrals, hence there is no obligation for a physician who accepts EHR help to refer patients to that hospital. But hospital administrators recognize that they're much more likely to win the favor of community-based doctors if they try to help doctors deal with the challenges of running a solo or small group practice.

The hospitals themselves benefit from a well-wired network of doctors in their communities. For one, it makes it far easier to ensure that all patients' records make it back to the primary care physician. This, hospital administrators believe, will improve care, reduce medical errors, and save money by reducing duplicative tests.

Once physicians go electronic, they discover many benefits, said Charles Parker, vice president and chief technology officer for Masspro, a health care performance improvement organization founded by the Massachusetts Medical Society. “In 99% of clinics, you can see return on investment in EHR within 2 years. And in some best cases, you see ROI in 90 days.”

In studying physician practices in Massachusetts, he said the big savings come from reduced need for transcription services, fewer redundant lab tests, swifter claims processing, and fewer days for claims in accounts receivable. He also noted that Medicare and Medicaid in his state include financial incentives for physicians to comply with formulary guidelines, and this is far easier to do and to document in an EHR-based office.

Doctors using EHRs also spend, on average, less time on the phone with patients, and staffers spend markedly less time tracking down lost records or missing bits of information. “All the information is always at everyones' fingertips,” Mr. Parker said.

Participation in pay-for-performance plans also requires digitized information, and some of these plans will help foot the bill for physicians to implement EHRs.

Mr. Parker, and many other EHR advocates, believe EHRs will increasingly become a central feature in the “medical home” construct, which is now a very hot idea among health plan administrators and big employers.

He noted that the National Business Coalition on Health's widely touted Bridges to Excellence program will be preferentially rewarding clinics that meet their definition of a medical home. Electronic capabilities are part of those criteria. He said that he believes that incentive structure may very well be the strongest incentive to move primary care physicians to embrace EHRs, and he called on vendors to pay more attention to this feature.

“You need to enable doctors to get the medical home assignation at the end of the process. You need to enable them to realize real revenue increases as a result, or there's simply no incentive. EHR companies are usually only focused on selling EHRs, but they fail to attend to the full-blown aspects of practice assessment and care redesign,” he said. “EHRs are really a tool for practice redesign. You really can improve the efficiency of care.”

WASHINGTON — If you've been thinking about implementing an electronic health record system but are daunted by the cost and complexity, you may have an untapped ally: your local hospital.

Many hospitals across the country have large and often untapped financial endowments for expansion of electronic health records (EHRs), to say nothing of strong technical support and considerable volume purchasing clout. As they compete for the allegiance of community-based physicians, some hospitals are finding that they can generate considerable goodwill by extending a helping hand to primary care doctors who want to digitize their practices.

“Doctors should contact the business development and community outreach offices at their local hospitals, and ask what they can do to help facilitate EHR adoption, advised Dr. Todd Rothenhaus, chief medical information officer for Caritas Christi Healthcare Systems, a six-hospital network in eastern Massachusetts.

Speaking at the fifth annual World Health Care Congress, Dr. Rothenhaus said community physicians are often pleasantly surprised to find out how much assistance they can obtain from area hospitals.

Nearly all of the nation's hospitals now have some form of EHR system in place. But broader adoption in solo and small group practices has been notoriously slow, a fact that vexes health care policy makers, hospital system administrators, and insurers who believe firmly that EHRs are the key to improving health care delivery.

To help remove some of the roadblocks to broader adoption, Congress modified the Stark antikickback regulations, creating “safe harbors” that enable hospitals to pay up to 85% of the EHR software costs for physicians practicing in their catchment areas.

“That's pretty good. And further, as hospitals we can also get volume discounts on hardware, so there's an extra 10%–15% savings,” said Dr. Rothenhaus.

With an actual example from the Caritas Christi system, he explained that a two-physician, one-nurse practice going from paper records to full EHR on its own would spend roughly $28,000 for hardware, $25,000 for software, $1,500 for training, $4,500 per year for software maintenance, and $2,400 for a software support contract. The total would be over $61,000 in the first year.

With the help of a local Caritas Christi hospital, the hardware cost drops to $25,000, the software costs the practice only $3,375, the training goes down to $1,200, the software maintenance is only $810, and the support package goes down to $2,160, for a final cost of just over $42,545.

While that's hardly chump change, it does put full EHR implementation within reach of more small practices. Dr. Rothenhaus said the savings can be even greater for practices that want to purchase more costly software systems to read and store ultrasounds, echocardiograms, and other data-intensive diagnostic images.

There are nonfiscal advantages to working with a local hospital, Dr. Rothenhaus said. For one, you gain access to hospital-affiliated technicians and analysts who are usually geographically close to the practice, as opposed to anonymous tech support that might be in another state or even another country. Hospital-based IT analysts tend to be well versed in a wide range of applications, system designs, and software packages, so they can be of great help in choosing and configuring the right system for a given practice, he said.

In addition, hospitals usually have strong relationships with equipment and software vendors; not only do they get better prices on support packages, they also get faster and more attentive help when something goes wrong.

Dr. Rothenhaus said Caritas Christi has received roughly $6 million in grants from Blue Cross/Blue Shield, Harvard Pilgrim Health Systems, and other organizations interested in pushing EHR out into the trenches of community-based health care. This money is specifically earmarked for offsetting the hardware and software costs for doctors. “I cannot imagine we are the only ones doing this,” he joked, noting that in many parts of the country, smaller hospital systems are competing fiercely for patient referral streams from physicians in their communities.

The Stark laws expressedly prohibit any sort of direct financial inducements for referrals, hence there is no obligation for a physician who accepts EHR help to refer patients to that hospital. But hospital administrators recognize that they're much more likely to win the favor of community-based doctors if they try to help doctors deal with the challenges of running a solo or small group practice.

The hospitals themselves benefit from a well-wired network of doctors in their communities. For one, it makes it far easier to ensure that all patients' records make it back to the primary care physician. This, hospital administrators believe, will improve care, reduce medical errors, and save money by reducing duplicative tests.

Once physicians go electronic, they discover many benefits, said Charles Parker, vice president and chief technology officer for Masspro, a health care performance improvement organization founded by the Massachusetts Medical Society. “In 99% of clinics, you can see return on investment in EHR within 2 years. And in some best cases, you see ROI in 90 days.”

In studying physician practices in Massachusetts, he said the big savings come from reduced need for transcription services, fewer redundant lab tests, swifter claims processing, and fewer days for claims in accounts receivable. He also noted that Medicare and Medicaid in his state include financial incentives for physicians to comply with formulary guidelines, and this is far easier to do and to document in an EHR-based office.

Doctors using EHRs also spend, on average, less time on the phone with patients, and staffers spend markedly less time tracking down lost records or missing bits of information. “All the information is always at everyones' fingertips,” Mr. Parker said.

Participation in pay-for-performance plans also requires digitized information, and some of these plans will help foot the bill for physicians to implement EHRs.

Mr. Parker, and many other EHR advocates, believe EHRs will increasingly become a central feature in the “medical home” construct, which is now a very hot idea among health plan administrators and big employers.

He noted that the National Business Coalition on Health's widely touted Bridges to Excellence program will be preferentially rewarding clinics that meet their definition of a medical home. Electronic capabilities are part of those criteria. He said that he believes that incentive structure may very well be the strongest incentive to move primary care physicians to embrace EHRs, and he called on vendors to pay more attention to this feature.

“You need to enable doctors to get the medical home assignation at the end of the process. You need to enable them to realize real revenue increases as a result, or there's simply no incentive. EHR companies are usually only focused on selling EHRs, but they fail to attend to the full-blown aspects of practice assessment and care redesign,” he said. “EHRs are really a tool for practice redesign. You really can improve the efficiency of care.”

WASHINGTON — Search engine giant Google has joined software giant Microsoft in an attempt to revolutionize health care information technology, one patient at a time.

Google launched Google Health this spring with an aim of establishing itself as the leading repository of personal health records (PHR). Google is also positioning itself as a primary clearinghouse for clinical information, self-care tools, and provider ratings to help patients make educated health care decisions.

Google Health emerged just as the smoke began to clear from Microsoft's launch of its own HealthVault PHR platform last fall.

Both companies see individual patients, not health care systems, as the primary locus of change for health care information technology, and both provide individuals with secure but user-friendly systems for aggregating all of their health care records, data, diagnostic images, laboratory results, and medical histories. They hope to put an end to the fragmentation, duplication, and lack of portability that characterize paper-based health record-keeping.

Executives at both HealthVault and Google Health said that they believe digitally enabled patients will help push more doctors to implement electronic medical records systems in their offices.

Todd Wiseman, head of Google's Federal Enterprise Team, says the creation of Google Health was a natural move. “We now have more than 1 billion people worldwide using Google every day. Google is the No. 1 search engine for health information, and health topics are a top search category for Google,” he said at the fifth annual World Health Care Congress.

Google Health will eventually enable people all over the country to store their PHRs and allow them to make their own determinations about who may have access to those records. Users can also store medical contacts and other relevant information. “Users should have easy access to their medical records, and should be able to act on their data. Medical records should follow the patient and exist in an environment of interoperability, portability, privacy, and security,” Mr. Wiseman said. “We don't hold our users' data hostage.”

The system can automatically import physician reports, prescription history, and lab results. Eventually, it will enable people to schedule appointments, refill prescriptions, and employ personal health and wellness tools, Mr. Wiseman said. Google Health's PHR function also will be enriched with specialized health-oriented search functions, clinical trial matching, and a host of other health management tools, all of which can be integrated with a user's Gmail e-mail account.

Google Health will not charge people to store PHRs; likewise, doctors will be able to access their patients' PHRs—with patient permission, of course—at no cost.

“We don't have any plans for ads within the Google Health product,” Mr. Wiseman said. “We see it as a way to drive more Google search traffic.” The search returns, of course, will arrive with ads and sponsored placements (just like every Google search), but he stressed that the PHR side of things will remain free of commercials.

Google is currently running a pilot field test of the Google Health system in partnership with the Cleveland Clinic. “We're 2 months into that, and we have 1,600 Cleveland Clinic patients storing their PHRs right now. This will go up to about 10,000. We're testing the process of data sharing in a live clinical-care delivery setting, with real patients and real doctors. The goal is simply proof of concept. At Google, we strongly believe in testing things.”

Mr. Wiseman pointed out that Google has significant advantages over other companies vying for a piece of the evolving PHR market. For one, the company is wholly independent and not tethered to any health care plan or provider system, so a Google Health PHR is completely portable. Users would be able to access their records even if they change health plans, jobs, or even countries. He stressed that, as a company, Google is a neutral stakeholder as far as how someone uses their PHR, which is different from PHR systems tied to specific health plans. “We stand by the user and the user only.”

Google has one more major advantage: massive data storage capacity. “We can store and manage a lot of data,” Mr. Wiseman said, noting that Google already gives its Gmail users six gigabytes of e-mail storage capacity. “That's a lot. And when you think about storing x-rays, MRIs, and other things like that, there will be a big need for memory.”

Google Health essentially is head-on competition for Microsoft's HealthVault, which has been up and running since last fall. While Microsoft has been involved in health care IT solutions for hospitals and health plans for more than a decade, its PHR efforts are fairly new, said George Scriban, senior product manager for HealthVault.

In an interview, Mr. Scriban said HealthVault, which is also free to consumers, tries to solve one of the most frustrating health issues for ordinary people: fragmentation.

“Fragmentation of delivery of care has a lot to do with fragmentation of someone's health care identity. Everybody's health care identity is spread around in little slices in different sectors. The employer has some information, various doctors have others, hospitals and payers and pharmacies have still others. The ideal is to have all one's information, presentable and portable and useful to any and all providers,” Mr. Scriban said.

Essentially, HealthVault is a consumer-controlled hub for gathering and controlling information from various sectors of a person's “health care ecosystem.”

Mr. Scriban said that he understands that some physicians get nervous at the thought of patients in control of their own medical records. But he believes that systems like HealthVault and Google Health are really just systematizing what already happens informally.

“When a patient gets a referral from one doctor to another, it is really that patient who acts as an information transporter, telling the new doctor his or her medical history, medication use, and in some cases actually transferring paper records,” he said.

HealthVault tries to standardize, stabilize, and formalize that process, and Mr. Scriban contends that this will reduce errors, prevent loss of important information, eliminate redundancy, and give physicians a fuller picture of their patients' health.

He added that HealthVault is being designed to interface with many different electronic medical records systems. He said that he hopes that as more patients create PHRs, more doctors will see the ultimate value in interconnectivity.

HealthVault and Google Health are similar in many respects. “Both are backed by large companies with a lot of resources; [both companies] have looked at the same problem and arrived at similar conclusions. One conclusion is that you cannot revolutionize health care in one big step. The other is that the consumer is really the agent of change in all of this,” Mr. Scriban said.

Still, there are some differences. He stressed that Microsoft is primarily focused on enabling people to manage their health information, and less engaged in providing self-care tools, something that Google is pursuing.

Although it is natural to view the current landscape as a clash of the IT titans, Mr. Scriban said he thinks that view is somewhat overstated. “In the end, we're really glad that Google has joined us in attempting to deal with the problems of personal health information management. I don't think it's really a Google vs. Microsoft scenario. It's more like Google, Microsoft, and all of us who are involved in PHRs and EHRs versus paper.”

Both Google and Microsoft are actively engaged in lining up partners across the health care landscape, including insurers and managed care plans, information service providers, medical organizations, and patient advocacy groups.

Microsoft recently partnered with Kaiser Permanente, an integrated health plan with more than 8 million members, to test the transfer of data from Kaiser's records into HealthVault. The pilot project, launched in June, is open to Kaiser's 159,000 employees. The idea is to combine the clinical data entered by Kaiser physicians, which are available in the Kaiser personal health record, with patient-entered health information and clinical information from providers outside of the Kaiser system. “Providing new ways to manage their health online is one more way we can engage consumers in their care,” Anna-Lisa Silvestre, vice president of online services at Kaiser Permanente, said in a statement. “We believe that Microsoft HealthVault will be a valuable supplement to our expanding set of online features.”

Kaiser officials plan to reevaluate the pilot later in the year before expanding it to Kaiser members.

Google's Mr. Wiseman said it is particularly important to create alliances with health plans. “A lot of people won't use Google Health unless their health plans support it.” Google's other major focus is on consumer decision support tools.

Among Google Health's new partners is HealthGrades, the private company that has quietly emerged as the leader in online physician and hospital ratings. HealthGrades uses publicly available data on quality outcomes based on 32 standardized procedures and health conditions to grade physician and hospital performance. The ratings parameters are based on work done by the National Quality Forum.

“HealthGrades' mission is to guide Americans to better health care,” said Dr. Samantha Collier, chief medical officer of HealthGrades. “There are enormous gaps between what we know we could do and should do, and what actually happens in health care. There are vast gaps between the best and worst hospitals and clinics.”

Currently, Web users seeking HealthGrades ratings for a doctor or hospital must pay a fee. Under the partnership agreement, Google Health users would have free access to the ratings.

Though the specifics have not yet been worked out, the idea is that Google Health users searching for doctors or clinics would obtain a listing of the top 10 appropriate practitioners locally. Each listing would contain basic contact information, as well as a “more” button, clicking on which would allow the user to see the full HealthGrades profile for that physician or hospital, including any disciplinary actions or malpractice cases, past or pending.

At issue, of course, is how Google and HealthGrades will determine which practitioners and facilities show up on the top 10 list for a particular search. Dr. Collier and Mr. Wiseman said that initially the order of rank will be based on Google's standard model, which lists the most trafficked sites highest. The rankings would not be based on the HealthGrades scores.

From a physician's perspective, it is difficult to say which mode of determining the listings would be preferable. On one hand, Web site traffic has little clinical relevance, and all but rules out doctors who do not have Web sites. On the other hand, rankings based on HealthGrades scores would only be as fair and reasonable as the scores themselves.

One thing is certain: With major IT players like Microsoft and Google entering the arena, PHRs and electronically empowered patients are going to play a significant role in reshaping health care over the next decade.

Google Health has joined Microsoft's HealthVault in pursuit of PHRbusiness. ©2008 Microsoft Corporation/Google Health

WASHINGTON — Search engine giant Google has joined software giant Microsoft in an attempt to revolutionize health care information technology, one patient at a time.

Google launched Google Health this spring with an aim of establishing itself as the leading repository of personal health records (PHR). Google is also positioning itself as a primary clearinghouse for clinical information, self-care tools, and provider ratings to help patients make educated health care decisions.

Google Health emerged just as the smoke began to clear from Microsoft's launch of its own HealthVault PHR platform last fall.

Both companies see individual patients, not health care systems, as the primary locus of change for health care information technology, and both provide individuals with secure but user-friendly systems for aggregating all of their health care records, data, diagnostic images, laboratory results, and medical histories. They hope to put an end to the fragmentation, duplication, and lack of portability that characterize paper-based health record-keeping.

Executives at both HealthVault and Google Health said that they believe digitally enabled patients will help push more doctors to implement electronic medical records systems in their offices.

Todd Wiseman, head of Google's Federal Enterprise Team, says the creation of Google Health was a natural move. “We now have more than 1 billion people worldwide using Google every day. Google is the No. 1 search engine for health information, and health topics are a top search category for Google,” he said at the fifth annual World Health Care Congress.

Google Health will eventually enable people all over the country to store their PHRs and allow them to make their own determinations about who may have access to those records. Users can also store medical contacts and other relevant information. “Users should have easy access to their medical records, and should be able to act on their data. Medical records should follow the patient and exist in an environment of interoperability, portability, privacy, and security,” Mr. Wiseman said. “We don't hold our users' data hostage.”

The system can automatically import physician reports, prescription history, and lab results. Eventually, it will enable people to schedule appointments, refill prescriptions, and employ personal health and wellness tools, Mr. Wiseman said. Google Health's PHR function also will be enriched with specialized health-oriented search functions, clinical trial matching, and a host of other health management tools, all of which can be integrated with a user's Gmail e-mail account.

Google Health will not charge people to store PHRs; likewise, doctors will be able to access their patients' PHRs—with patient permission, of course—at no cost.

“We don't have any plans for ads within the Google Health product,” Mr. Wiseman said. “We see it as a way to drive more Google search traffic.” The search returns, of course, will arrive with ads and sponsored placements (just like every Google search), but he stressed that the PHR side of things will remain free of commercials.

Google is currently running a pilot field test of the Google Health system in partnership with the Cleveland Clinic. “We're 2 months into that, and we have 1,600 Cleveland Clinic patients storing their PHRs right now. This will go up to about 10,000. We're testing the process of data sharing in a live clinical-care delivery setting, with real patients and real doctors. The goal is simply proof of concept. At Google, we strongly believe in testing things.”

Mr. Wiseman pointed out that Google has significant advantages over other companies vying for a piece of the evolving PHR market. For one, the company is wholly independent and not tethered to any health care plan or provider system, so a Google Health PHR is completely portable. Users would be able to access their records even if they change health plans, jobs, or even countries. He stressed that, as a company, Google is a neutral stakeholder as far as how someone uses their PHR, which is different from PHR systems tied to specific health plans. “We stand by the user and the user only.”

Google has one more major advantage: massive data storage capacity. “We can store and manage a lot of data,” Mr. Wiseman said, noting that Google already gives its Gmail users six gigabytes of e-mail storage capacity. “That's a lot. And when you think about storing x-rays, MRIs, and other things like that, there will be a big need for memory.”

Google Health essentially is head-on competition for Microsoft's HealthVault, which has been up and running since last fall. While Microsoft has been involved in health care IT solutions for hospitals and health plans for more than a decade, its PHR efforts are fairly new, said George Scriban, senior product manager for HealthVault.

In an interview, Mr. Scriban said HealthVault, which is also free to consumers, tries to solve one of the most frustrating health issues for ordinary people: fragmentation.

“Fragmentation of delivery of care has a lot to do with fragmentation of someone's health care identity. Everybody's health care identity is spread around in little slices in different sectors. The employer has some information, various doctors have others, hospitals and payers and pharmacies have still others. The ideal is to have all one's information, presentable and portable and useful to any and all providers,” Mr. Scriban said.

Essentially, HealthVault is a consumer-controlled hub for gathering and controlling information from various sectors of a person's “health care ecosystem.”

Mr. Scriban said that he understands that some physicians get nervous at the thought of patients in control of their own medical records. But he believes that systems like HealthVault and Google Health are really just systematizing what already happens informally.

“When a patient gets a referral from one doctor to another, it is really that patient who acts as an information transporter, telling the new doctor his or her medical history, medication use, and in some cases actually transferring paper records,” he said.

HealthVault tries to standardize, stabilize, and formalize that process, and Mr. Scriban contends that this will reduce errors, prevent loss of important information, eliminate redundancy, and give physicians a fuller picture of their patients' health.

He added that HealthVault is being designed to interface with many different electronic medical records systems. He said that he hopes that as more patients create PHRs, more doctors will see the ultimate value in interconnectivity.

HealthVault and Google Health are similar in many respects. “Both are backed by large companies with a lot of resources; [both companies] have looked at the same problem and arrived at similar conclusions. One conclusion is that you cannot revolutionize health care in one big step. The other is that the consumer is really the agent of change in all of this,” Mr. Scriban said.

Still, there are some differences. He stressed that Microsoft is primarily focused on enabling people to manage their health information, and less engaged in providing self-care tools, something that Google is pursuing.

Although it is natural to view the current landscape as a clash of the IT titans, Mr. Scriban said he thinks that view is somewhat overstated. “In the end, we're really glad that Google has joined us in attempting to deal with the problems of personal health information management. I don't think it's really a Google vs. Microsoft scenario. It's more like Google, Microsoft, and all of us who are involved in PHRs and EHRs versus paper.”

Both Google and Microsoft are actively engaged in lining up partners across the health care landscape, including insurers and managed care plans, information service providers, medical organizations, and patient advocacy groups.

Microsoft recently partnered with Kaiser Permanente, an integrated health plan with more than 8 million members, to test the transfer of data from Kaiser's records into HealthVault. The pilot project, launched in June, is open to Kaiser's 159,000 employees. The idea is to combine the clinical data entered by Kaiser physicians, which are available in the Kaiser personal health record, with patient-entered health information and clinical information from providers outside of the Kaiser system. “Providing new ways to manage their health online is one more way we can engage consumers in their care,” Anna-Lisa Silvestre, vice president of online services at Kaiser Permanente, said in a statement. “We believe that Microsoft HealthVault will be a valuable supplement to our expanding set of online features.”

Kaiser officials plan to reevaluate the pilot later in the year before expanding it to Kaiser members.

Google's Mr. Wiseman said it is particularly important to create alliances with health plans. “A lot of people won't use Google Health unless their health plans support it.” Google's other major focus is on consumer decision support tools.

Among Google Health's new partners is HealthGrades, the private company that has quietly emerged as the leader in online physician and hospital ratings. HealthGrades uses publicly available data on quality outcomes based on 32 standardized procedures and health conditions to grade physician and hospital performance. The ratings parameters are based on work done by the National Quality Forum.

“HealthGrades' mission is to guide Americans to better health care,” said Dr. Samantha Collier, chief medical officer of HealthGrades. “There are enormous gaps between what we know we could do and should do, and what actually happens in health care. There are vast gaps between the best and worst hospitals and clinics.”

Currently, Web users seeking HealthGrades ratings for a doctor or hospital must pay a fee. Under the partnership agreement, Google Health users would have free access to the ratings.

Though the specifics have not yet been worked out, the idea is that Google Health users searching for doctors or clinics would obtain a listing of the top 10 appropriate practitioners locally. Each listing would contain basic contact information, as well as a “more” button, clicking on which would allow the user to see the full HealthGrades profile for that physician or hospital, including any disciplinary actions or malpractice cases, past or pending.

At issue, of course, is how Google and HealthGrades will determine which practitioners and facilities show up on the top 10 list for a particular search. Dr. Collier and Mr. Wiseman said that initially the order of rank will be based on Google's standard model, which lists the most trafficked sites highest. The rankings would not be based on the HealthGrades scores.

From a physician's perspective, it is difficult to say which mode of determining the listings would be preferable. On one hand, Web site traffic has little clinical relevance, and all but rules out doctors who do not have Web sites. On the other hand, rankings based on HealthGrades scores would only be as fair and reasonable as the scores themselves.

One thing is certain: With major IT players like Microsoft and Google entering the arena, PHRs and electronically empowered patients are going to play a significant role in reshaping health care over the next decade.

Google Health has joined Microsoft's HealthVault in pursuit of PHRbusiness. ©2008 Microsoft Corporation/Google Health

WASHINGTON — Search engine giant Google has joined software giant Microsoft in an attempt to revolutionize health care information technology, one patient at a time.

Google launched Google Health this spring with an aim of establishing itself as the leading repository of personal health records (PHR). Google is also positioning itself as a primary clearinghouse for clinical information, self-care tools, and provider ratings to help patients make educated health care decisions.

Google Health emerged just as the smoke began to clear from Microsoft's launch of its own HealthVault PHR platform last fall.

Both companies see individual patients, not health care systems, as the primary locus of change for health care information technology, and both provide individuals with secure but user-friendly systems for aggregating all of their health care records, data, diagnostic images, laboratory results, and medical histories. They hope to put an end to the fragmentation, duplication, and lack of portability that characterize paper-based health record-keeping.

Executives at both HealthVault and Google Health said that they believe digitally enabled patients will help push more doctors to implement electronic medical records systems in their offices.

Todd Wiseman, head of Google's Federal Enterprise Team, says the creation of Google Health was a natural move. “We now have more than 1 billion people worldwide using Google every day. Google is the No. 1 search engine for health information, and health topics are a top search category for Google,” he said at the fifth annual World Health Care Congress.

Google Health will eventually enable people all over the country to store their PHRs and allow them to make their own determinations about who may have access to those records. Users can also store medical contacts and other relevant information. “Users should have easy access to their medical records, and should be able to act on their data. Medical records should follow the patient and exist in an environment of interoperability, portability, privacy, and security,” Mr. Wiseman said. “We don't hold our users' data hostage.”

The system can automatically import physician reports, prescription history, and lab results. Eventually, it will enable people to schedule appointments, refill prescriptions, and employ personal health and wellness tools, Mr. Wiseman said. Google Health's PHR function also will be enriched with specialized health-oriented search functions, clinical trial matching, and a host of other health management tools, all of which can be integrated with a user's Gmail e-mail account.

Google Health will not charge people to store PHRs; likewise, doctors will be able to access their patients' PHRs—with patient permission, of course—at no cost.

“We don't have any plans for ads within the Google Health product,” Mr. Wiseman said. “We see it as a way to drive more Google search traffic.” The search returns, of course, will arrive with ads and sponsored placements (just like every Google search), but he stressed that the PHR side of things will remain free of commercials.

Google is currently running a pilot field test of the Google Health system in partnership with the Cleveland Clinic. “We're 2 months into that, and we have 1,600 Cleveland Clinic patients storing their PHRs right now. This will go up to about 10,000. We're testing the process of data sharing in a live clinical-care delivery setting, with real patients and real doctors. The goal is simply proof of concept. At Google, we strongly believe in testing things.”

Mr. Wiseman pointed out that Google has significant advantages over other companies vying for a piece of the evolving PHR market. For one, the company is wholly independent and not tethered to any health care plan or provider system, so a Google Health PHR is completely portable. Users would be able to access their records even if they change health plans, jobs, or even countries. He stressed that, as a company, Google is a neutral stakeholder as far as how someone uses their PHR, which is different from PHR systems tied to specific health plans. “We stand by the user and the user only.”

Google has one more major advantage: massive data storage capacity. “We can store and manage a lot of data,” Mr. Wiseman said, noting that Google already gives its Gmail users six gigabytes of e-mail storage capacity. “That's a lot. And when you think about storing x-rays, MRIs, and other things like that, there will be a big need for memory.”

Google Health essentially is head-on competition for Microsoft's HealthVault, which has been up and running since last fall. While Microsoft has been involved in health care IT solutions for hospitals and health plans for more than a decade, its PHR efforts are fairly new, said George Scriban, senior product manager for HealthVault.

In an interview, Mr. Scriban said HealthVault, which is also free to consumers, tries to solve one of the most frustrating health issues for ordinary people: fragmentation.

“Fragmentation of delivery of care has a lot to do with fragmentation of someone's health care identity. Everybody's health care identity is spread around in little slices in different sectors. The employer has some information, various doctors have others, hospitals and payers and pharmacies have still others. The ideal is to have all one's information, presentable and portable and useful to any and all providers,” Mr. Scriban said.

Essentially, HealthVault is a consumer-controlled hub for gathering and controlling information from various sectors of a person's “health care ecosystem.”

Mr. Scriban said that he understands that some physicians get nervous at the thought of patients in control of their own medical records. But he believes that systems like HealthVault and Google Health are really just systematizing what already happens informally.

“When a patient gets a referral from one doctor to another, it is really that patient who acts as an information transporter, telling the new doctor his or her medical history, medication use, and in some cases actually transferring paper records,” he said.

HealthVault tries to standardize, stabilize, and formalize that process, and Mr. Scriban contends that this will reduce errors, prevent loss of important information, eliminate redundancy, and give physicians a fuller picture of their patients' health.

He added that HealthVault is being designed to interface with many different electronic medical records systems. He said that he hopes that as more patients create PHRs, more doctors will see the ultimate value in interconnectivity.

HealthVault and Google Health are similar in many respects. “Both are backed by large companies with a lot of resources; [both companies] have looked at the same problem and arrived at similar conclusions. One conclusion is that you cannot revolutionize health care in one big step. The other is that the consumer is really the agent of change in all of this,” Mr. Scriban said.

Still, there are some differences. He stressed that Microsoft is primarily focused on enabling people to manage their health information, and less engaged in providing self-care tools, something that Google is pursuing.

Although it is natural to view the current landscape as a clash of the IT titans, Mr. Scriban said he thinks that view is somewhat overstated. “In the end, we're really glad that Google has joined us in attempting to deal with the problems of personal health information management. I don't think it's really a Google vs. Microsoft scenario. It's more like Google, Microsoft, and all of us who are involved in PHRs and EHRs versus paper.”

Both Google and Microsoft are actively engaged in lining up partners across the health care landscape, including insurers and managed care plans, information service providers, medical organizations, and patient advocacy groups.

Microsoft recently partnered with Kaiser Permanente, an integrated health plan with more than 8 million members, to test the transfer of data from Kaiser's records into HealthVault. The pilot project, launched in June, is open to Kaiser's 159,000 employees. The idea is to combine the clinical data entered by Kaiser physicians, which are available in the Kaiser personal health record, with patient-entered health information and clinical information from providers outside of the Kaiser system. “Providing new ways to manage their health online is one more way we can engage consumers in their care,” Anna-Lisa Silvestre, vice president of online services at Kaiser Permanente, said in a statement. “We believe that Microsoft HealthVault will be a valuable supplement to our expanding set of online features.”

Kaiser officials plan to reevaluate the pilot later in the year before expanding it to Kaiser members.

Google's Mr. Wiseman said it is particularly important to create alliances with health plans. “A lot of people won't use Google Health unless their health plans support it.” Google's other major focus is on consumer decision support tools.

Among Google Health's new partners is HealthGrades, the private company that has quietly emerged as the leader in online physician and hospital ratings. HealthGrades uses publicly available data on quality outcomes based on 32 standardized procedures and health conditions to grade physician and hospital performance. The ratings parameters are based on work done by the National Quality Forum.

“HealthGrades' mission is to guide Americans to better health care,” said Dr. Samantha Collier, chief medical officer of HealthGrades. “There are enormous gaps between what we know we could do and should do, and what actually happens in health care. There are vast gaps between the best and worst hospitals and clinics.”

Currently, Web users seeking HealthGrades ratings for a doctor or hospital must pay a fee. Under the partnership agreement, Google Health users would have free access to the ratings.

Though the specifics have not yet been worked out, the idea is that Google Health users searching for doctors or clinics would obtain a listing of the top 10 appropriate practitioners locally. Each listing would contain basic contact information, as well as a “more” button, clicking on which would allow the user to see the full HealthGrades profile for that physician or hospital, including any disciplinary actions or malpractice cases, past or pending.

At issue, of course, is how Google and HealthGrades will determine which practitioners and facilities show up on the top 10 list for a particular search. Dr. Collier and Mr. Wiseman said that initially the order of rank will be based on Google's standard model, which lists the most trafficked sites highest. The rankings would not be based on the HealthGrades scores.

From a physician's perspective, it is difficult to say which mode of determining the listings would be preferable. On one hand, Web site traffic has little clinical relevance, and all but rules out doctors who do not have Web sites. On the other hand, rankings based on HealthGrades scores would only be as fair and reasonable as the scores themselves.

One thing is certain: With major IT players like Microsoft and Google entering the arena, PHRs and electronically empowered patients are going to play a significant role in reshaping health care over the next decade.

Google Health has joined Microsoft's HealthVault in pursuit of PHRbusiness. ©2008 Microsoft Corporation/Google Health

WASHINGTON — Search engine giant Google has joined software giant Microsoft in an attempt to revolutionize health care information technology, one patient at a time.

Google launched Google Health this spring with the aim of establishing itself as the leading repository of personal health records (PHR) and positioning itself as a primary clearinghouse for clinical information, self-care tools, and provider ratings to help patients make educated health care decisions.

Google Health emerged just as the smoke began to clear from Microsoft's launch of the HealthVault PHR platform last fall.

Both companies see individual patients, not health care systems, as the primary locus of change for health care information technology, and both provide secure user-friendly systems for individuals to aggregate all of their health care records, data, diagnostic images, laboratory results, and medical histories. The hope is to put an end to the fragmentation, duplication, and lack of portability that characterize paper-based health record-keeping.

Executives at both HealthVault and Google Health said they believe that digitally enabled patients will help push more doctors to implement electronic medical records systems in their offices.

Todd Wiseman, head of Google's Federal Enterprise Team, said the creation of Google Health was a natural move. “We now have more than 1 billion people worldwide using Google every day. [It] is the No. 1 search engine for health information, and health topics are a top search category for Google,” he said at the fifth annual World Health Care Congress.

Google Health will eventually enable people to store their PHRs and allow them to decide who can have access to those records. Users can also store medical contacts and other relevant information. “Users should have easy access to their medical records … [which] should follow the patient and exist in an environment of interoperability, portability, privacy, and security. We don't hold our users' data hostage.”

The system can automatically import physician reports, prescription history, and lab results. Eventually, it will enable people to schedule appointments, refill prescriptions, and employ personal health and wellness tools, Mr. Wiseman said. The PHR system also offers health-oriented search functions, clinical trial matching, and a host of other health management tools that can be integrated with a user's e-mail account.

There will be no charge to patients for storing PHRs, and doctors will be able to access patients' PHRs—with patient permission—at no cost.

“We don't have any plans for ads within the Google Health product,” Mr. Wiseman said, although the search returns will arrive with ads and sponsored placements, as is the case with every Google search.

Google is currently running a pilot field test of the Google Health system in partnership with the Cleveland Clinic.

Mr. Wiseman said Google is an independent company that is not tied to a health care plan or provider system, so a Google Health PHR is completely portable. And it has massive data storage capacity, which is important, given that it will need to store files containing x-rays and MRI, he added.

Microsoft has been involved in health care IT solutions for hospitals and health plans for more than a decade, but its PHR efforts, in the form of HealthVault, has been up and running since last fall. It is essentially a consumer-controlled hub for gathering and controlling information from various sectors of a person's “health care ecosystem,” such as data the employer, various doctors, hospitals, payers, and pharmacies, according to George Scriban, senior product manager for HealthVault.

HealthVault is also free to consumers. It tries to solve one of the most frustrating health issues for ordinary people: fragmentation. “Fragmentation of delivery of care has a lot to do with fragmentation of someone's health care identity … The ideal is to have all of one's information, presentable and portable and useful to any and all pro- viders,” Mr. Scriban said in an interview.

Although some physicians get nervous at the thought of patients in control of their own medical records, Mr. Scriban said systems such as HealthVault and Google Health are simply systematizing what already happens informally. “When a patient gets a referral from one doctor to another, it is really that patient who acts as an information transporter, telling the new doctor his or her medical history, medication use, and in some cases actually transferring paper records.”

HealthVault tries to facilitate that process, which Mr. Scriban contends will reduce errors, prevent loss of important information, eliminate redundancy, and give physicians a fuller picture of their patients' health. The system is being designed to interface with many different electronic medical records systems.

HealthVault and Google Health are similar in that they are both backed by large companies with a lot of resources and have both looked at the same problem and arrived at similar conclusions, he said. “One conclusion is that you cannot revolutionize health care in one big step. The other is that the consumer is really the agent of change in all of this.”

Still, there are some differences, he said. Microsoft is primarily focused on enabling people to manage their health information, and less engaged in providing self-care tools, something that Google is pursuing.

Both companies are trying to line up partners across the health care landscape, including insurers and managed care plans, information service providers, medical organizations, and patient advocacy groups.

Microsoft recently partnered with Kaiser Permanente, an integrated health plan with more than 8 million members, to test the transfer of data from Kaiser's personal health records into HealthVault.

The pilot project, launched last month, is open to Kaiser's 159,000 employees. The idea is to combine the clinical data entered by Kaiser physicians, which is available in the Kaiser personal health record, with patient-entered health information and clinical information from providers outside of the Kaiser system. Kaiser officials plan to reevaluate the pilot later in the year before expanding it to its members.

Google's Mr. Wiseman said it is important to create alliances with health plans because many people will not use it unless their health plans support it. Among Google Health's new partners is HealthGrades, a private company that is a leader in online physician and hospital ratings. Currently, Web users seeking HealthGrades ratings for a doctor or hospital must pay a fee. Under the partnership agreement, users would have free access to the ratings.

Google Health and Microsoft's HealthVault aim to make consumers agents of change. 2008 Microsoft Corporation/Google Health

WASHINGTON — Search engine giant Google has joined software giant Microsoft in an attempt to revolutionize health care information technology, one patient at a time.

Google launched Google Health this spring with the aim of establishing itself as the leading repository of personal health records (PHR) and positioning itself as a primary clearinghouse for clinical information, self-care tools, and provider ratings to help patients make educated health care decisions.

Google Health emerged just as the smoke began to clear from Microsoft's launch of the HealthVault PHR platform last fall.

Both companies see individual patients, not health care systems, as the primary locus of change for health care information technology, and both provide secure user-friendly systems for individuals to aggregate all of their health care records, data, diagnostic images, laboratory results, and medical histories. The hope is to put an end to the fragmentation, duplication, and lack of portability that characterize paper-based health record-keeping.

Executives at both HealthVault and Google Health said they believe that digitally enabled patients will help push more doctors to implement electronic medical records systems in their offices.

Todd Wiseman, head of Google's Federal Enterprise Team, said the creation of Google Health was a natural move. “We now have more than 1 billion people worldwide using Google every day. [It] is the No. 1 search engine for health information, and health topics are a top search category for Google,” he said at the fifth annual World Health Care Congress.

Google Health will eventually enable people to store their PHRs and allow them to decide who can have access to those records. Users can also store medical contacts and other relevant information. “Users should have easy access to their medical records … [which] should follow the patient and exist in an environment of interoperability, portability, privacy, and security. We don't hold our users' data hostage.”

The system can automatically import physician reports, prescription history, and lab results. Eventually, it will enable people to schedule appointments, refill prescriptions, and employ personal health and wellness tools, Mr. Wiseman said. The PHR system also offers health-oriented search functions, clinical trial matching, and a host of other health management tools that can be integrated with a user's e-mail account.

There will be no charge to patients for storing PHRs, and doctors will be able to access patients' PHRs—with patient permission—at no cost.

“We don't have any plans for ads within the Google Health product,” Mr. Wiseman said, although the search returns will arrive with ads and sponsored placements, as is the case with every Google search.

Google is currently running a pilot field test of the Google Health system in partnership with the Cleveland Clinic.

Mr. Wiseman said Google is an independent company that is not tied to a health care plan or provider system, so a Google Health PHR is completely portable. And it has massive data storage capacity, which is important, given that it will need to store files containing x-rays and MRI, he added.

Microsoft has been involved in health care IT solutions for hospitals and health plans for more than a decade, but its PHR efforts, in the form of HealthVault, has been up and running since last fall. It is essentially a consumer-controlled hub for gathering and controlling information from various sectors of a person's “health care ecosystem,” such as data the employer, various doctors, hospitals, payers, and pharmacies, according to George Scriban, senior product manager for HealthVault.

HealthVault is also free to consumers. It tries to solve one of the most frustrating health issues for ordinary people: fragmentation. “Fragmentation of delivery of care has a lot to do with fragmentation of someone's health care identity … The ideal is to have all of one's information, presentable and portable and useful to any and all pro- viders,” Mr. Scriban said in an interview.

Although some physicians get nervous at the thought of patients in control of their own medical records, Mr. Scriban said systems such as HealthVault and Google Health are simply systematizing what already happens informally. “When a patient gets a referral from one doctor to another, it is really that patient who acts as an information transporter, telling the new doctor his or her medical history, medication use, and in some cases actually transferring paper records.”

HealthVault tries to facilitate that process, which Mr. Scriban contends will reduce errors, prevent loss of important information, eliminate redundancy, and give physicians a fuller picture of their patients' health. The system is being designed to interface with many different electronic medical records systems.

HealthVault and Google Health are similar in that they are both backed by large companies with a lot of resources and have both looked at the same problem and arrived at similar conclusions, he said. “One conclusion is that you cannot revolutionize health care in one big step. The other is that the consumer is really the agent of change in all of this.”

Still, there are some differences, he said. Microsoft is primarily focused on enabling people to manage their health information, and less engaged in providing self-care tools, something that Google is pursuing.

Both companies are trying to line up partners across the health care landscape, including insurers and managed care plans, information service providers, medical organizations, and patient advocacy groups.

Microsoft recently partnered with Kaiser Permanente, an integrated health plan with more than 8 million members, to test the transfer of data from Kaiser's personal health records into HealthVault.

The pilot project, launched last month, is open to Kaiser's 159,000 employees. The idea is to combine the clinical data entered by Kaiser physicians, which is available in the Kaiser personal health record, with patient-entered health information and clinical information from providers outside of the Kaiser system. Kaiser officials plan to reevaluate the pilot later in the year before expanding it to its members.

Google's Mr. Wiseman said it is important to create alliances with health plans because many people will not use it unless their health plans support it. Among Google Health's new partners is HealthGrades, a private company that is a leader in online physician and hospital ratings. Currently, Web users seeking HealthGrades ratings for a doctor or hospital must pay a fee. Under the partnership agreement, users would have free access to the ratings.

Google Health and Microsoft's HealthVault aim to make consumers agents of change. 2008 Microsoft Corporation/Google Health

WASHINGTON — Search engine giant Google has joined software giant Microsoft in an attempt to revolutionize health care information technology, one patient at a time.

Google launched Google Health this spring with the aim of establishing itself as the leading repository of personal health records (PHR) and positioning itself as a primary clearinghouse for clinical information, self-care tools, and provider ratings to help patients make educated health care decisions.

Google Health emerged just as the smoke began to clear from Microsoft's launch of the HealthVault PHR platform last fall.

Both companies see individual patients, not health care systems, as the primary locus of change for health care information technology, and both provide secure user-friendly systems for individuals to aggregate all of their health care records, data, diagnostic images, laboratory results, and medical histories. The hope is to put an end to the fragmentation, duplication, and lack of portability that characterize paper-based health record-keeping.

Executives at both HealthVault and Google Health said they believe that digitally enabled patients will help push more doctors to implement electronic medical records systems in their offices.

Todd Wiseman, head of Google's Federal Enterprise Team, said the creation of Google Health was a natural move. “We now have more than 1 billion people worldwide using Google every day. [It] is the No. 1 search engine for health information, and health topics are a top search category for Google,” he said at the fifth annual World Health Care Congress.

Google Health will eventually enable people to store their PHRs and allow them to decide who can have access to those records. Users can also store medical contacts and other relevant information. “Users should have easy access to their medical records … [which] should follow the patient and exist in an environment of interoperability, portability, privacy, and security. We don't hold our users' data hostage.”

The system can automatically import physician reports, prescription history, and lab results. Eventually, it will enable people to schedule appointments, refill prescriptions, and employ personal health and wellness tools, Mr. Wiseman said. The PHR system also offers health-oriented search functions, clinical trial matching, and a host of other health management tools that can be integrated with a user's e-mail account.

There will be no charge to patients for storing PHRs, and doctors will be able to access patients' PHRs—with patient permission—at no cost.

“We don't have any plans for ads within the Google Health product,” Mr. Wiseman said, although the search returns will arrive with ads and sponsored placements, as is the case with every Google search.

Google is currently running a pilot field test of the Google Health system in partnership with the Cleveland Clinic.

Mr. Wiseman said Google is an independent company that is not tied to a health care plan or provider system, so a Google Health PHR is completely portable. And it has massive data storage capacity, which is important, given that it will need to store files containing x-rays and MRI, he added.

Microsoft has been involved in health care IT solutions for hospitals and health plans for more than a decade, but its PHR efforts, in the form of HealthVault, has been up and running since last fall. It is essentially a consumer-controlled hub for gathering and controlling information from various sectors of a person's “health care ecosystem,” such as data the employer, various doctors, hospitals, payers, and pharmacies, according to George Scriban, senior product manager for HealthVault.

HealthVault is also free to consumers. It tries to solve one of the most frustrating health issues for ordinary people: fragmentation. “Fragmentation of delivery of care has a lot to do with fragmentation of someone's health care identity … The ideal is to have all of one's information, presentable and portable and useful to any and all pro- viders,” Mr. Scriban said in an interview.

Although some physicians get nervous at the thought of patients in control of their own medical records, Mr. Scriban said systems such as HealthVault and Google Health are simply systematizing what already happens informally. “When a patient gets a referral from one doctor to another, it is really that patient who acts as an information transporter, telling the new doctor his or her medical history, medication use, and in some cases actually transferring paper records.”

HealthVault tries to facilitate that process, which Mr. Scriban contends will reduce errors, prevent loss of important information, eliminate redundancy, and give physicians a fuller picture of their patients' health. The system is being designed to interface with many different electronic medical records systems.

HealthVault and Google Health are similar in that they are both backed by large companies with a lot of resources and have both looked at the same problem and arrived at similar conclusions, he said. “One conclusion is that you cannot revolutionize health care in one big step. The other is that the consumer is really the agent of change in all of this.”

Still, there are some differences, he said. Microsoft is primarily focused on enabling people to manage their health information, and less engaged in providing self-care tools, something that Google is pursuing.

Both companies are trying to line up partners across the health care landscape, including insurers and managed care plans, information service providers, medical organizations, and patient advocacy groups.

Microsoft recently partnered with Kaiser Permanente, an integrated health plan with more than 8 million members, to test the transfer of data from Kaiser's personal health records into HealthVault.

The pilot project, launched last month, is open to Kaiser's 159,000 employees. The idea is to combine the clinical data entered by Kaiser physicians, which is available in the Kaiser personal health record, with patient-entered health information and clinical information from providers outside of the Kaiser system. Kaiser officials plan to reevaluate the pilot later in the year before expanding it to its members.

Google's Mr. Wiseman said it is important to create alliances with health plans because many people will not use it unless their health plans support it. Among Google Health's new partners is HealthGrades, a private company that is a leader in online physician and hospital ratings. Currently, Web users seeking HealthGrades ratings for a doctor or hospital must pay a fee. Under the partnership agreement, users would have free access to the ratings.

Google Health and Microsoft's HealthVault aim to make consumers agents of change. 2008 Microsoft Corporation/Google Health

WASHINGTON — If you've been thinking about implementing an electronic health record system but are daunted by the cost and complexity, you may have an untapped ally: your local hospital.

Many hospitals across the country have large and often untapped financial endowments for expansion of electronic health records (EHRs), to say nothing of strong technical support and considerable volume purchasing clout. As they compete for the allegiance of community-based physicians, some hospitals are finding that they can generate considerable goodwill by extending a helping hand to primary care doctors who want to digitize their practices.

“Doctors should contact the business development and community outreach offices at their local hospitals, and ask what they can do to help facilitate EHR adoption, advised Dr. Todd Rothenhaus, chief medical information officer for Caritas Christi Healthcare Systems, a six-hospital network in eastern Massachusetts.

Speaking at health care congress sponsored by the Wall Street Journal and CNBC, Dr. Rothenhaus said community physicians are often pleasantly surprised to find out how much assistance they can obtain from area hospitals.

Nearly all of the nation's hospitals now have some form of EHR system in place. But broader adoption in solo and small group practices has been notoriously slow, a fact that vexes health care policy makers, hospital system administrators, and insurers who believe firmly that EHRs are the key to improving health care delivery.

To help remove some of the roadblocks to broader adoption, Congress modified the Stark antikickback regulations, creating “safe harbors” that enable hospitals to pay up to 85% of the EHR software costs for physicians practicing in their catchment areas.

“That's pretty good. And further, as hospitals we can also get volume discounts on hardware, so there's an extra 10%–15% savings,” said Dr. Rothenhaus.

With an actual example from the Caritas Christi system, he explained that a two-physician, one-nurse practice going from paper records to full EHR on its own would spend roughly $28,000 for hardware, $25,000 for software, $1,500 for training, $4,500 per year for software maintenance, and $2,400 for a software support contract. The total would be over $61,000 in the first year.

With the help of a local Caritas Christi hospital, the hardware cost drops to $25,000, the software costs the practice only $3,375, the training goes down to $1,200, the software maintenance is only $810, and the support package goes down to $2,160, for a final cost of just over $42,545.

While that's hardly chump change, it does put full EHR implementation within reach of more small practices. Dr. Rothenhaus said the savings can be even greater for practices that want to purchase more costly software systems to read and store ultrasounds, echocardiograms, and other data-intensive diagnostic images.

There are nonfiscal advantages to working with a local hospital, Dr. Rothenhaus said. For one, you gain access to hospital-affiliated technicians and analysts who are usually geographically close to the practice, as opposed to anonymous tech support that might be in another state or even another country. Hospital-based IT analysts tend to be well versed in a wide range of applications, system designs, and software packages, so they can be of great help in choosing and configuring the right system for a given practice, he said.

In addition, hospitals usually have strong relationships with equipment and software vendors; not only do they get better prices on support packages, they also get faster and more attentive help when something goes wrong.

Dr. Rothenhaus said Caritas Christi has received roughly $6 million in grants from Blue Cross/Blue Shield, Harvard Pilgrim Health Systems, and other organizations interested in pushing EHR out into the trenches of community-based health care. This money is specifically earmarked for offsetting the hardware and software costs for doctors.

He noted that in many parts of the country, smaller hospital systems are competing fiercely for patient referral streams from physicians out in their communities.

The Stark laws expressedly prohibit any sort of direct financial inducements for referrals, hence there is no obligation for a physician who accepts EHR help to refer patients to that hospital. But hospital administrators recognize that they're much more likely to win the favor of community-based doctors if they try to help doctors deal with the challenges of running a solo or small group practice.

The hospitals themselves benefit from a well-wired network of doctors in their communities. For one, it makes it far easier to ensure that all patients' records make it back to the primary care physician. This, hospital administrators believe, will improve care, reduce medical errors, and save money by reducing duplicative tests.

Once physicians go electronic, they discover many benefits, said Charles Parker, vice president and chief technology officer for Masspro, a health care performance improvement organization founded by the Massachusetts Medical Society. “In 99% of clinics, you can see return on investment in EHR within 2 years. And in some best cases, you see ROI in 90 days.”

In studying physician practices in Massachusetts, he said the big savings come from reduced need for transcription services, fewer redundant lab tests, swifter claims processing, and fewer days for claims in accounts receivable. He also noted that Medicare and Medicaid in his state include financial incentives for physicians to comply with formulary guidelines, and this is far easier to do and to document in an EHR-based office.

WASHINGTON — If you've been thinking about implementing an electronic health record system but are daunted by the cost and complexity, you may have an untapped ally: your local hospital.

Many hospitals across the country have large and often untapped financial endowments for expansion of electronic health records (EHRs), to say nothing of strong technical support and considerable volume purchasing clout. As they compete for the allegiance of community-based physicians, some hospitals are finding that they can generate considerable goodwill by extending a helping hand to primary care doctors who want to digitize their practices.

“Doctors should contact the business development and community outreach offices at their local hospitals, and ask what they can do to help facilitate EHR adoption, advised Dr. Todd Rothenhaus, chief medical information officer for Caritas Christi Healthcare Systems, a six-hospital network in eastern Massachusetts.

Speaking at health care congress sponsored by the Wall Street Journal and CNBC, Dr. Rothenhaus said community physicians are often pleasantly surprised to find out how much assistance they can obtain from area hospitals.

Nearly all of the nation's hospitals now have some form of EHR system in place. But broader adoption in solo and small group practices has been notoriously slow, a fact that vexes health care policy makers, hospital system administrators, and insurers who believe firmly that EHRs are the key to improving health care delivery.

To help remove some of the roadblocks to broader adoption, Congress modified the Stark antikickback regulations, creating “safe harbors” that enable hospitals to pay up to 85% of the EHR software costs for physicians practicing in their catchment areas.

“That's pretty good. And further, as hospitals we can also get volume discounts on hardware, so there's an extra 10%–15% savings,” said Dr. Rothenhaus.

With an actual example from the Caritas Christi system, he explained that a two-physician, one-nurse practice going from paper records to full EHR on its own would spend roughly $28,000 for hardware, $25,000 for software, $1,500 for training, $4,500 per year for software maintenance, and $2,400 for a software support contract. The total would be over $61,000 in the first year.

With the help of a local Caritas Christi hospital, the hardware cost drops to $25,000, the software costs the practice only $3,375, the training goes down to $1,200, the software maintenance is only $810, and the support package goes down to $2,160, for a final cost of just over $42,545.

While that's hardly chump change, it does put full EHR implementation within reach of more small practices. Dr. Rothenhaus said the savings can be even greater for practices that want to purchase more costly software systems to read and store ultrasounds, echocardiograms, and other data-intensive diagnostic images.

There are nonfiscal advantages to working with a local hospital, Dr. Rothenhaus said. For one, you gain access to hospital-affiliated technicians and analysts who are usually geographically close to the practice, as opposed to anonymous tech support that might be in another state or even another country. Hospital-based IT analysts tend to be well versed in a wide range of applications, system designs, and software packages, so they can be of great help in choosing and configuring the right system for a given practice, he said.

In addition, hospitals usually have strong relationships with equipment and software vendors; not only do they get better prices on support packages, they also get faster and more attentive help when something goes wrong.

Dr. Rothenhaus said Caritas Christi has received roughly $6 million in grants from Blue Cross/Blue Shield, Harvard Pilgrim Health Systems, and other organizations interested in pushing EHR out into the trenches of community-based health care. This money is specifically earmarked for offsetting the hardware and software costs for doctors.

He noted that in many parts of the country, smaller hospital systems are competing fiercely for patient referral streams from physicians out in their communities.

The Stark laws expressedly prohibit any sort of direct financial inducements for referrals, hence there is no obligation for a physician who accepts EHR help to refer patients to that hospital. But hospital administrators recognize that they're much more likely to win the favor of community-based doctors if they try to help doctors deal with the challenges of running a solo or small group practice.

The hospitals themselves benefit from a well-wired network of doctors in their communities. For one, it makes it far easier to ensure that all patients' records make it back to the primary care physician. This, hospital administrators believe, will improve care, reduce medical errors, and save money by reducing duplicative tests.

Once physicians go electronic, they discover many benefits, said Charles Parker, vice president and chief technology officer for Masspro, a health care performance improvement organization founded by the Massachusetts Medical Society. “In 99% of clinics, you can see return on investment in EHR within 2 years. And in some best cases, you see ROI in 90 days.”

In studying physician practices in Massachusetts, he said the big savings come from reduced need for transcription services, fewer redundant lab tests, swifter claims processing, and fewer days for claims in accounts receivable. He also noted that Medicare and Medicaid in his state include financial incentives for physicians to comply with formulary guidelines, and this is far easier to do and to document in an EHR-based office.

WASHINGTON — If you've been thinking about implementing an electronic health record system but are daunted by the cost and complexity, you may have an untapped ally: your local hospital.

Many hospitals across the country have large and often untapped financial endowments for expansion of electronic health records (EHRs), to say nothing of strong technical support and considerable volume purchasing clout. As they compete for the allegiance of community-based physicians, some hospitals are finding that they can generate considerable goodwill by extending a helping hand to primary care doctors who want to digitize their practices.

“Doctors should contact the business development and community outreach offices at their local hospitals, and ask what they can do to help facilitate EHR adoption, advised Dr. Todd Rothenhaus, chief medical information officer for Caritas Christi Healthcare Systems, a six-hospital network in eastern Massachusetts.

Speaking at health care congress sponsored by the Wall Street Journal and CNBC, Dr. Rothenhaus said community physicians are often pleasantly surprised to find out how much assistance they can obtain from area hospitals.

Nearly all of the nation's hospitals now have some form of EHR system in place. But broader adoption in solo and small group practices has been notoriously slow, a fact that vexes health care policy makers, hospital system administrators, and insurers who believe firmly that EHRs are the key to improving health care delivery.

To help remove some of the roadblocks to broader adoption, Congress modified the Stark antikickback regulations, creating “safe harbors” that enable hospitals to pay up to 85% of the EHR software costs for physicians practicing in their catchment areas.

“That's pretty good. And further, as hospitals we can also get volume discounts on hardware, so there's an extra 10%–15% savings,” said Dr. Rothenhaus.

With an actual example from the Caritas Christi system, he explained that a two-physician, one-nurse practice going from paper records to full EHR on its own would spend roughly $28,000 for hardware, $25,000 for software, $1,500 for training, $4,500 per year for software maintenance, and $2,400 for a software support contract. The total would be over $61,000 in the first year.

With the help of a local Caritas Christi hospital, the hardware cost drops to $25,000, the software costs the practice only $3,375, the training goes down to $1,200, the software maintenance is only $810, and the support package goes down to $2,160, for a final cost of just over $42,545.

While that's hardly chump change, it does put full EHR implementation within reach of more small practices. Dr. Rothenhaus said the savings can be even greater for practices that want to purchase more costly software systems to read and store ultrasounds, echocardiograms, and other data-intensive diagnostic images.

There are nonfiscal advantages to working with a local hospital, Dr. Rothenhaus said. For one, you gain access to hospital-affiliated technicians and analysts who are usually geographically close to the practice, as opposed to anonymous tech support that might be in another state or even another country. Hospital-based IT analysts tend to be well versed in a wide range of applications, system designs, and software packages, so they can be of great help in choosing and configuring the right system for a given practice, he said.

In addition, hospitals usually have strong relationships with equipment and software vendors; not only do they get better prices on support packages, they also get faster and more attentive help when something goes wrong.

Dr. Rothenhaus said Caritas Christi has received roughly $6 million in grants from Blue Cross/Blue Shield, Harvard Pilgrim Health Systems, and other organizations interested in pushing EHR out into the trenches of community-based health care. This money is specifically earmarked for offsetting the hardware and software costs for doctors.

He noted that in many parts of the country, smaller hospital systems are competing fiercely for patient referral streams from physicians out in their communities.

The Stark laws expressedly prohibit any sort of direct financial inducements for referrals, hence there is no obligation for a physician who accepts EHR help to refer patients to that hospital. But hospital administrators recognize that they're much more likely to win the favor of community-based doctors if they try to help doctors deal with the challenges of running a solo or small group practice.

The hospitals themselves benefit from a well-wired network of doctors in their communities. For one, it makes it far easier to ensure that all patients' records make it back to the primary care physician. This, hospital administrators believe, will improve care, reduce medical errors, and save money by reducing duplicative tests.

Once physicians go electronic, they discover many benefits, said Charles Parker, vice president and chief technology officer for Masspro, a health care performance improvement organization founded by the Massachusetts Medical Society. “In 99% of clinics, you can see return on investment in EHR within 2 years. And in some best cases, you see ROI in 90 days.”

In studying physician practices in Massachusetts, he said the big savings come from reduced need for transcription services, fewer redundant lab tests, swifter claims processing, and fewer days for claims in accounts receivable. He also noted that Medicare and Medicaid in his state include financial incentives for physicians to comply with formulary guidelines, and this is far easier to do and to document in an EHR-based office.