The healthcare industry continues to see a significant volume of changes and transitions in electronic health records systems.
According to a 2023 report by the Office of the National Coordinator for Health Information Technology (ONC), nearly 50 percent of hospitals have transitioned to a new EHR vendor within the past five years. Factors such as mergers and acquisitions, changing patient expectations and advancements in healthcare technology are driving this shift.
As a CIO, it's crucial to understand these industry trends and evaluate whether an organization should optimize its current system or transition to a new one. There four factors to consider in making any decision regarding an EHR replacement.
Why consider an EHR change?
Most organizations considering an EHR change base their decision on a combination of four factors: strategic, operational, technical and financial. These factors often transcend any comprehensive analysis and must be prioritized when making decisions about an EHR system.
Strategic factors. Strategic considerations often arise from market dynamics, mergers and acquisitions, and patient engagement trends.
Market alignment. In some regions, the market is dominated by a particular EHR vendor. For example, in the greater Philadelphia area, one vendor dominates, and therefore organizations may feel compelled to align with that vendor to achieve seamless record interchange, encourage physician collaboration and improve patient experience.
Mergers and acquisitions. If an organization is active in mergers or acquisitions, its EHR direction may be influenced by whether it is maintaining independence or being acquired. For instance, an independent regional entity recently explored platform options, but the final decision to adopt a specific IT system was driven by its acquisition by a larger regional health system. This example highlights how EHR decisions are a strategic consideration when evaluating whether to maintain autonomy or align with a larger organization.
Recent change in C-suite leadership. If an organization has recently undergone changes in leadership at the C-level, those leaders may be predisposed to operate the organization on a platform used within organizations at which they previously worked.
Patient engagement. If an organization operates in an area with high patient engagement and expectations for digital experiences, an outdated EHR system may not meet these needs. The rise of telemedicine, patient portals and mobile health management tools requires an EHR that supports seamless digital interactions.
Operational factors. Operational demands from various user groups within the hospital can drive the need for an EHR change.
Clinical operations. Physicians often lead the charge for EHR transitions when the existing system fails to support their workflows or hinders patient care. Clinician dissatisfaction with EHR usability has been a major driver of system replacements.
Finance and revenue cycle management. The finance department may require stronger reporting and revenue cycle management tools than the current EHR can provide.
Data analytics. With the increasing focus on value-based care, organizations require EHRs that support comprehensive reporting and data analytics. If a current system struggles to support these needs, operational pressure may drive a change.
Technical factors. The technical capabilities and limitations of a current EHR system are crucial in deciding whether to optimize or replace.
Platform age and currency. If an EHR system is approaching end-of-life, it may no longer receive updates or support from the vendor, making replacement inevitable.
Intelligence and interoperability. Modern EHRs are expected to provide intelligent solutions that support data connectivity, mobility and advanced analytics. If an existing system lacks these features, especially as the industry moves towards greater adoption of various forms of artificial intelligence technologies and population health management, it may be time for a change.
Vendor performance. It’s crucial to assess a current vendor's performance, commitment to the platform and alignment with an organization’s direction. If a vendor struggles with gaps in its offerings or has an uncertain future, a change may be necessary.
Financial factors. Financial considerations often stem from deficiencies related to operational challenges, system functional capabilities or improper system implementation design decisions.
In these situations, the organization should perform a deeper assessment on whether an optimization initiative is more cost effective and less disruptive than a full system replacement.
In evaluating replacement options, be sure to recognize and account for hidden costs, such as third-party contracting and data migration, which can impact the total cost of ownership for a new system. Balancing the total cost of ownership against return on investment is essential in making a financially sound decision.
Additional considerations in making a choice
As an organization is making a determination that a change is necessary and evaluates whether to optimize their existing EHR system or replace it entirely, a deep dive into both strategic and operational factors is necessary.
Strategic and operational drivers. If strategic and operational factors are the primary drivers, there will likely be less willingness and consensus for trying to optimize the existing system. A full replacement may be necessary to meet the organization's strategic goals.
Vendor performance. If vendor performance is a primary concern, consider performing a current state-future state analysis using Lean techniques. This analysis helps identify gaps and determine whether they can be addressed through optimization of current platforms and a vendor’s committed direction. Evaluate the vendor's commitment to the platform, the appropriateness of their capabilities and the flexibility of their contract.
Age of the system. The age of an organization’s current system plays a significant role. Replacement is often the default course of action for systems in place for more than 20 years. For systems in the 10- to 20-year range, the decision is less clear, and a thorough evaluation is needed. Optimization potential should be the starting position when evaluating a system that’s less than 10 years old.
When full replacement is the next move
There are two key considerations if a full EHR replacement is determined to be the right choice for an organization.
Explore all options. Don’t feel obligated to follow the herd and choose the most popular vendor. While larger companies may dominate the market, other vendors are developing innovative platforms that offer viable alternatives.
Prioritize organizational needs. Whether it's financial stability, independence or alignment with strategic direction, prioritize what matters most to the organization. Ensure that a chosen EHR vendor supports the organization’s future vision, including AI-enabled capabilities, data accessibility and market openness.
Finally, as a health systems CIO, guiding the organization through the decision to optimize or replace an EHR system is a complex process. It requires careful consideration of strategic, operational, technical and financial factors. By taking a holistic approach, the CIO can ensure that the EHR system supports the organization's long-term goals and enhances patient care delivery.
Jim Hennessy, FACHDM, is the former president of e4health, a consulting firm specializing in healthcare IT.
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