Healthcare organizations aren’t unaware of electronic health records. With keen interest, when these organizations plan to implement EHRs, the first question that comes to their mind is- EHR cost. Implementing EHR isn’t too complicated, but the cost of EHR can often be a roadblock. EHR pricing seems to vary depending on the needs and vendors. According to the 2022 EHR Project Report, a healthcare organization takes approximately 12 weeks to select an EHR, depending on its practice’s size. And the average budget per user for EHR software is around $1200, according to the same EHR report. Compared to larger practices, solo practices had a much higher budget for EHR development. Larger operations probably benefit from economies of scale, resulting in lower costs per user than solo practitioners. It’s also worth noting that, for an EHR purchase, a user is not the same as a physician; this includes support and admin employees who will require a user seat on the system to make bookings.
According to a study, on average, EHR maintenance costs are around $1,500 per physician per month. However, this study was conducted over a decade ago, when on-premises systems were the standard. But now, we’re largely dependent on cloud technology, so the breakdown of maintenance costs is primarily in the hands of the EHR vendor. However, you need to consider support and training, additional server expenditures, and the cost of maintaining your IT staff to manage and secure your data. All these cumulatively define EHR pricing. If you’re keen on understanding the different aspects of EHR costs, this article will give you insights into EHR integration and implementation costs.
EHR Cost Breakdown
As already mentioned, EHR cost is a significant barrier to EHR implementation. Perhaps, EHRs help a lot in increasing revenue over time. According to a Health Affairs report, solo and small offices can recover the average cost of an EHR in 2.5 years. Let’s look at the EHR implementation cost breakdown.
1. Direct Cost
According to a Health Affairs survey, the average multi-physician practice will spend about $162,000 on EHR implementation, with $85,000 going toward first-year maintenance costs. While the estimate is from the early days of EHR adoption, it still provides a framework and a basic indication of how much you might have to pay for EHR software costs. Practices that install an EHR system can expect to recoup their EHR system cost in around two and a half years and then enjoy an average of $23,000 in net benefits per year for each full-time employee.
2. Indirect Cost
You must also account for indirect EHR costs and the initial and standard installation fees. These hidden EHR costs account for a sizable amount of the total cost of adoption. EHR training is frequently regarded as an important item in the implementation budget. Investing in proper training for your physicians and employees will only appear costly. But avoiding this will cost you more in the long run as physicians and staff struggle to stay up to their obligations. Don’t skimp on extensive training for those needing it, as it will save you money.
3. Staffing-Related Cost
Another factor to consider is how much you’ll need to change your IT team after the EHR software goes online. Even if your practice’s IT requirements are small, assess whether you’ll require additional IT support during the deployment phase. Almost every medical practice must keep some IT tools, such as revenue cycle management software, operational around the clock. And maintaining these systems is time-consuming. While most cloud-based providers provide technical assistance, on-premises systems usually require qualified IT personnel.
4. Unexpected costs
You must remember that you might incur unanticipated EHR costs during the implementation process. Recognize potential issues and evaluate your situation accordingly. Although no one can forecast the cost of implementation, keeping these ideas in mind might help to avoid unexpected costs after the purchase.
Custom EHR Costs
Due to the wide range of medical specialties, each practice needs a system tailored to its particular requirements. For example, practices need remote patient monitoring or telehealth solutions for virtual care delivery and medical billing solutions for reimbursements. General practitioners and hospitals can rely on off-the-shelf systems. Still, a custom EHR may be a superior option for pediatricians, surgeons, mental health facilities, hospices, and other organizations with a more limited emphasis on services. On the typical cost of EHR deployment varies per provider. Depending on the number of features and integrations, it can range from $50,000 to $500,000 for different clients. However, custom EHR might appear costly, but it’s a great way to save money for the practice in the long run.
Budgeting for EHR Implementing
Given its dependence on specific features and practice requirements, gauging the precise cost of implementing an EHR can be intricate. The implementation expenses differ based on system type (web-based or on-site). While cloud-based applications involve subscription fees, on-site systems demand ongoing management and support. During the planning of EHR implementation, one must consider five fundamental components that require budgeting:
1. Hardware and networking
Ensuring its proper functionality is paramount for a healthcare organization to fully benefit from an EHR system. Adequate modern hardware and infrastructure play a crucial role. EHR vendors offer guidance on necessary adjustments pre-implementation, which may involve acquiring new devices like computers, laptops, and printers and enhancing the network, operating system, or applications. This proactive approach contributes to optimal system performance and cost-effectiveness.
Tailoring EHR adoption to healthcare organizations’ unique objectives and requirements can result in cost-effective strategies. Some opt for budget-friendly solutions like off-the-shelf offerings, focusing primarily on software expenses. Alternatively, tech-savvy teams might explore open-source EHR software, which can be economical or free. However, many institutions seek assistance due to intricate needs. Customization, integration with third-party tools, and workflow adjustments are often essential to ensure a smooth EHR implementation that aligns with their goals.
Implementing a new system or a significant overhaul of existing processes inevitably requires updating the knowledge of personnel. The costs associated with training can vary based on factors such as the extent of new features introduced, changes in workflows, the scale of the organization, and the intricacies of the adopted system. Considering these training expenses is essential when evaluating the overall costs of implementing an EHR system.
4. Ongoing Costs
Continual expenses encompass maintenance, support, internet, and agreements. To lower costs, practices might explore open-source EHR software or collaborate with vendors providing adaptable pricing. Moreover, assessing the cost-to-benefit ratio before EHR implementation ensures benefits surpass expenditures. With prudent planning, you can successfully adopt an EHR system for enduring advantages.
EHR Cost Compilation
Inquiring about the cost of an EHR is a common question, often yielding an answer prefaced by the ambiguous phrase “It depends.” The expense of an EHR varies based on the components purchased and the intended duration of use. Consequently, conducting an EHR price comparison requires a comprehensive evaluation of influencing factors, including:
1. Medium of Deployment- Cloud or On-Premises
The chosen software deployment method can influence the long-term expenses associated with an EHR system. As highlighted earlier, the total cost of ownership (TCO) over five years can diverge between on-premises and cloud-based systems. Cloud-based options may have different upfront and ongoing costs compared to office-based alternatives.
Yet, the complete cost evaluation of EHR systems encompasses various factors beyond TCO, such as system reliability, hardware investments, maintenance expenditures, and security considerations. These elements substantially impact the overall cost estimation, extending beyond the parameters addressed in the mentioned study.
2. Cost of top-notch EHR
EHR implementation costs vary based on the specific context and plan, making it challenging to determine an average cost. Case-specific examples shed light on implementation expenses. For instance, a Health Affairs study noted typical multi-physician practices spending on EHR implementation and maintenance. Similarly, a Medical Economics study highlighted primary care practices’ expenditure on hardware, software, peripherals, and support services. Hospital EHR implementation costs, being larger in scale, demonstrate wide variations among community hospitals.
3. Hidden costs
When analyzing EHR implementation costs, it’s crucial to include direct expenses like software licensing, maintenance projections, consulting/training fees, labor (including overtime), and potentially hardware for on-premises setups. Equally important are indirect costs, like reduced revenue, productivity losses, and decreased patient visits. Quantifying these factors can substantially influence the overall impact of an EHR implementation on the budget.
Costs of Popular EHRs
Determining the cost of popular EHR systems depends on factors like application, deployment, and included add-ons. Pricing variations stem from purchase vs. lease options or user/data volume licensing structures. This pricing complexity makes forecasting EHR expenses challenging. As pricing details are rarely online, obtaining cost insights often requires a request for information/proposal process. Despite this, practices can gather reliable cost estimates for potential systems during selection.
Epic systems cater to larger healthcare organizations like hospitals and health systems. Epic EHR costs particularly depend on the needs of healthcare organizations. However, their self-hosted solutions begin at $1,200, while pricing for large clinics and hospitals starts at $500,000. Epic doesn’t provide a free trial but offers a free demo through their sales representatives.
Cerner, a major EHR vendor for inpatient and ambulatory providers, offers cloud-based and on-premise options. Their cloud-based service costs around $25 per month, while on-premise deployment costs vary. Cerner provides a range of specialty-focused products but doesn’t offer a free trial.
Allscripts, focused on medium to small practices, offers various products, including EHR, revenue cycle, and population health solutions. They don’t publish pricing online. Instead, interested users need to contact them for pricing details. Allscripts doesn’t offer a free trial, and pricing varies based on features and products chosen.
eClinical offers EHR, practice management, patient engagement, and more. EHR is priced at $449/month, and EHR with practice management at $599/month. Their revenue cycle management costs 2.9% of collections. Pricing details are available on their website, and there’s no free trial.
How to Control Costs of EHR
Despite the manifold advantages associated with EHR systems and the compelling evidence that their implementation costs are typically recouped within two to three years, healthcare providers persistently highlight the challenge of inadequate EHR adoption budgets in digitalization. Notably, these budget constraints are consistently identified as a significant obstacle. In response, experts in the field offer a set of valuable recommendations aimed at curtailing EHR implementation expenses.
1. Installing open-source EHR
The utilization of open-source EHR systems may not boast a polished user interface. Yet, it can potentially deliver essential functionalities to medical practices at minimal or even zero expense. In scenarios where an organization lacks in-house IT expertise for open-source implementation or requires additional features and integrations, opting to engage a developer could be a more economical alternative than selecting a proprietary EHR solution.
2. Select only the required features
Conducting a thorough business and market analysis is advisable before searching for an EHR system, aiming to identify the essential functionalities required by the healthcare organization. When budget constraints are in play, it’s prudent to eliminate non-essential “nice-to-have” features and forego integrations that aren’t integral to daily workflows. It’s also essential to differentiate between EHR and EMR systems, opting for the one aligning most closely with the organization’s specific needs. This approach helps optimize costs and ensures a suitable EHR solution is chosen.
3. No compromise on security
When considering cost-cutting measures for EHR implementation, healthcare organizations must prioritize medical data security. Data breaches in the healthcare sector are frequent and exceptionally costly. Opting for a cheaper system with inadequate security measures may result in expenses far exceeding those associated with investing in a more reliable and higher-priced solution.
4. Pick a subscription-based model
For healthcare organizations concerned about initial upfront costs, the option of platforms offering annual subscription payments can be advantageous. While this model may result in a higher total cost of ownership over time, it provides flexibility. This enables organizations to adjust their service plans or switch them if necessary, allowing the budget to accommodate unforeseen circumstances and providing room for adaptation.
5. Collaborate with an experienced vendor
Healthcare organizations can benefit from software companies with a track record of successful EHR implementations, as they bring valuable insights to cost optimization, often addressing overlooked areas. Their experienced teams expedite the implementation process, resulting in reduced project costs and quicker access to the system’s advantages. This approach proves instrumental in achieving cost-effectiveness and maximizing benefits from the EHR system.
Putting an EHR system in place is not a simple task. But when done correctly, there are numerous advantages that practices can achieve. You may finish the procedure without error if you understand the EHR costs, prepare accordingly, and encourage a diligent EHR implementation expert. And once it’s up and running, you’ll wonder why you didn’t do it sooner. As this article sheds light on the cost of implementing EHR in hospitals or clinics, we hope it’ll become easier for you to plan and make budgets. Moreover, the cost of the EHR system won’t remain a matter of curiosity anymore.
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Written by Riken Shah linkedin
Riken's work motto is to help healthcare providers use technological advancements to make healthcare easily accessible to all stakeholders, from providers to patients. Under his leadership and guidance, OSP Labs has successfully developed over 600 customized software solutions for 200+ healthcare clients across continents.