DSH Hospitals Lag in Health IT for Prescription Drugs

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November 17, 2009 – Hospitals serving a high number of Medicaid and underinsured patients are less likely to adopt health IT technology, including systems for managing prescription drugs, than hospitals with a smaller indigent population, says a new study published in the October issue of Health Affairs.

So-called disproportionate-share hospitals (DSH), also exhibit lower quality performance in four significant treatment areas, the study found. This points to a growing disparity between hospitals that cater to the poor and those that don’t, the researchers warned.

By using electronic health records, however, DSH hospitals could make significant strides in closing that performance gap, the study concluded.

“This is a topic that’s been of concern to a lot of people in the policy world. As we move forward with health IT, are we creating a new digital divide between hospitals?” said Ashish Jha, an associate professor at Harvard School of Public Health and one of the authors of the report. “We now have, for the first time, national data showing that this is, indeed, an issue.”

Using the data will be important as the government moves forward with its $30-billion program to establish a national health IT infrastructure. A critical policy goal, Dr. Jha said, should be to ensure the technology campaign won’t leave some hospitals even farther behind — especially at a time when many high-DSH public hospitals have difficulty accessing local supplemental funding needed to install the new systems.

“The hospitals that are low-DSH hospitals may be the first ones to adopt health IT and if the technology is helpful, you may see the gaps grow even bigger,” he said.

States can opt out

Under the American Recovery and Reinvestment Act 2009 (ARRA), hospitals and non-hospital-based health care professionals can receive annual Medicare incentive payments for health IT adopted before 2014.

Incentives will be first made available for hospitals in fiscal year 2011, and include a $2-million base incentive and up to $11 million of additional payments, depending on the volume of the hospital’s patient discharges and Medicare patient days. A hospital that is deemed a “meaningful” electronic health records (EHR) user can receive up to four years of financial incentives payments under Medicare.

Medicaid EHR incentives will also be available from state Medicaid programs beginning in 2011 — assuming the state does not opt out due to financial stress. Medicaid incentives will be greater in the first year in recognition of the cost of system purchase and initial implementation, but will be paid annually to hospitals for up to six years.

DHS hospitals lag in performance, IT implementation

The four performance quality areas for which the DSH hospitals were compared were treatment of heart attacks, congestive heart failure, pneumonia, and surgical complications.

In their study of 2,368 acute-care nonfederal U.S. hospitals, Dr. Jha and the other researchers found that high-DSH hospitals had lower rates of adoption than low-DSH facilities for all of the 32 electronic health record clinical functionalities that were examined. This was true for medication-management related functions as well as for other functionalities.

Only 62 percent of the highest-DSH hospitals used electronic medication lists, compared with 74 percent of the lowest-DSH hospitals. Twenty-nine percent of the highest-DSH hospitals used e—prescribing, compared with 33 percent of the lowest-DSH hospitals, the study found.

Bar coding in medication administration also showed a gap: 27 percent of highest-DSH hospitals surveyed had implemented bar coding, compared with 41 percent of lowest-DSH hospitals. Electronic drug interaction alerts, meanwhile, were implemented at 63 percent of high-DSH hospitals, and at 70 percent of the lowest-DSH hospitals.

Money, money, money….

High-DSH hospitals that lack electronic health record systems typically cite inadequate capital as the reason, and they’re more likely than low-DSH hospitals to blame finances. The high-DSH hospitals are also more likely than their low-DSH counterparts to voice concerns about the costs of future support and maintenance, the study found.

The results of the study suggest that when the Medicare and Medicaid health IT provider incentive provisions of ARRA are implemented in early 2011, high-DSH hospitals may benefit more from the Medicaid incentives, which include financing of start-up and adoption costs.

Medicaid payments will begin in an amount equal to 85 percent of the “average allowable cost” to purchase, implement, or upgrade a certified EHR. Like the Medicare incentives, they will be calculated based on discharges and program patient days.

To what degree state Medicaid programs will be able to participate, however, is unknown. That makes monitoring how the money is used and how well hospitals succeed in implementing health IT critical, Dr. Jha said.

Uncertainties abound

The Medicare incentives, meanwhile, are limited under ARRA to rewards for “meaningful use” of EHR systems, a term whose definition is still being tweaked by the Centers for Medicare & Medicaid’s Health IT Policy Committee.

Given such uncertainties, “tracking will need to focus no just on adoption, but also on the impact these systems have on the efficiency and effectiveness of the care delivered,” the researchers wrote in Health Affairs.

ARRA requires that the EHR be installed and actively used to collect and share patient information and to support improved clinical care.  Hospitals are not allowed to count e-prescribing in as meaningful use, although non-hospital providers may.

A hospital that is a “meaningful” EHR user can receive up to four years of financial incentives payments under Medicare. But no hospital can receive incentive payments from both Medicaid and Medicare during the same year.