Advancing return on investment analysis for electronic health record investment. Impacts of payment mechanisms and public returns.

This paper reviews a sample of studies reporting evidence on the implementation of electronic health record systems and identifies connections between reported benefits and hospitals' internal returns as well as public returns to external stakeholders, such as patients, the government and insurers. The study indicates that payment mechanisms play an important role in whether and to what extent reported benefits can be translated into a healthcare provider's financial profits. Under fee-for-service, reported benefits, such as reducing duplicate tests or improving preventive practice, will have a negative effect on a provider's financial performance. However, providers can realize those benefits financially under capitation. EHRs can improve clinician's compliance with pay-for-performance guidelines and promote the collection and report of quality data. But P4P's financial impact on EHR adoption is not clear. The study also suggests that returns from adopting EHRs can flow from the internal improvements in a healthcare entity resulting in returns to external stakeholders.