How much is this going to cost me?
Several studies estimate the cost of purchasing and installing an electronic health record (EHR) ranges from $15,000 to $70,000 per provider.1-5 Costs vary depending on whether you select in-office EHR deployment or web-based EHR deployment. Web-based EHR deployment, known as Software as a Service (SaaS), requires a monthly subscription with a third party to store information outside your office; in-office EHR deployment requires licensing agreements. For example, the Michigan Center for Effective IT Adoption estimates five year total cost of ownership (TCO) averages approximately $48,000 for in-office deployment and $58,000 for SaaS deployment.
To estimate how much EHR ownership will cost your practice/hospital/health center, you should consider the five main components of EHR implementation. These cost components relate to ambulatory primary care settings, as opposed to hospitals which may have different cost structures. You should consider each of the following components when budgeting for EHR implementation costs:
- Hardware: Potential hardware costs may include database servers, desktop computers, tablets/laptops, printers, and scanners.
- EHR Software: Potential software costs include an EHR application, interface modules (e.g. lab interface module), and upgrades to your EHR application. Remember, software costs vary depending on whether you select an in-office EHR deployment or a SaaS EHR deployment.
- Implementation Assistance: Potential implementation assistance costs include IT contractor, attorney, electrician, and/or consultant support; chart conversion; hardware/network installation; and workflow redesign support. Your local Regional Extension Center (REC) may be able to assist you with some of these tasks at free- or reduced-prices.
- Training: Your practice/hospital/health center will need to train your physicians, nurses, and office staff before and during EHR implementation. Physicians, nurses, and office staff need to understand how to use the EHR and associated hardware and how the EHR will create new workflows for your practice, so you should budget for staff training time.
- Ongoing Network Fees and Maintenance: Potential ongoing costs include hardware and software license maintenance agreements, ongoing staff education, telecom fees, and IT support fees. In addition, your practice/hospital/health center may need to hire new staff, such as IT operations staff, clinical data analysts, or application analysts.
Your practice/hospital/health center can use the Total Cost of Ownership and Return on Investment tool to more precisely estimate the costs and benefits of EHR ownership. Take steps to avoid any surprise costs. One key lesson learned from the field is to consider EHR upgrade, laboratory information system interface, and custom reporting costs when budgeting for your EHR purchase.
The following chart provides estimated average upfront cost, yearly cost, and five year total cost of ownership for both in-office and SaaS deployment. These cost estimates are based on the experiences of RECs in the field.
| Cost | In-Office | SaaS | ||||
|---|---|---|---|---|---|---|
| Upfront Cost | Yearly Cost | 5 Year TCO | Upfront Cost | Yearly Cost | 5 Year TCO | |
| Estimated Average Cost | $33,000 | $4,000 | $48,000 | $26,000 | $8,000 | $58,000 |
Costs of adopting EHRs will vary based on practice type, setting, demographics, and workflow. Selecting and adopting an EHR and attesting to meaningful use are hard work and a substantial investment, especially for small primary care practices. Your local Regional Extension Center (REC) is here to help. Your local REC is equipped with the personnel and resources to support and advise providers in all phases of EHR adoption and implementation, including registering for the EHR incentive programs and attesting to meaningful use. Contact your local Regional Extension Center for help.
References
- Blumenthal D, Glaser JP. “Information Technology Comes to Medicine.” N Engl J Med. 2007; 356:2527-2534.
- Smith PD. “Implementing an EMR System: One Clinic’s Experience.” Fam Pract Manag. 2003; 10(5):37-42.
- Fleming NS, Culler SD, McCorkle R, Becker ER, Ballard DJ. “The Financial And Nonfinancial Costs Of Implementing Electronic Health Records In Primary Care Practices.” Health Aff. 2011; 30(3):481-489.
- Miller RH, Sim I, Newman J. “Electronic Medical Records: Lessons from Small Physician Practices.” Prepared for California HealthCare Foundation. 2003.
- Bodenheimer T, Grumbach K. “Electric technology: a spark to revitalize primary care?” JAMA. 2003; 290(2):259-264.
- Bodenheimer T, Grumbach K. “Electric technology: a spark to revitalize primary care?” JAMA. 2003; 290(2):259-264.
