November, 30th 2017
MEMO TO: Board of Directors
Subject: Benefits of the Electronic Medical Record
The Electronic Medical Record (EMR) system that was recently procured has numerous advantages to the local community health center. For instance, the health will reduce unnecessary care costs, the quality of care will improve and medical errors prevented. For instance, based on (Wang et al., 2003) cost-benefit analysis of the Electronic Medical Record by the use of Computerized Physician Order Entry (CPOE) system indicated positive results. The benefits were related savings in expenditure in billing errors, radiology tests and drugs and positive returns on investment (ROI). According to (Barlow et al., 2004) assessment of the effects of EMR based on a year experience projected within five years. The study indicated an improvement in the reimbursement process and reduction in the maintenance of paper chats, after the adoption of the EMR (Hillestad et al., 2005) reported an annual saving of more than $81 billion. Cumulative savings were from adverse drug event prevention, drug guidance, utilization of nursing time and renal dosing guidance. In the case of the local community health center, a cost-benefit analysis was done based on the health center cash flows. The determination of the detailed items of the costs and benefits are based on the differential costing that is used for managerial accounting after comparing the workflows between EMR system and the paper chat system. A conservative CBA analysis was done as qualitative or potential benefits were excluded. The actual measured value included the cost of the Electronic Medical Record. The SMC accounting records aided in the provision of financial benefits and costs. The actual measured values formed the costs of EMR implementation. The differences between the actual measured values and expected values with the exception of the Electronic Medical Record provided data on the benefits. Moreover, the opinions of the IT engineers, care floor nurses and medical record administrators provided the capital amounts where data was not available. The Present values (PV) were derived from the measured amounts through the use of SMCs expected values. Then the discounted payback period and the benefit-cost ration were calculated. It is from the above analysis that I conclude that the recently purchased EMR has numerous benefits to the health center.
Barlow S, Johnson J, Steck J. (2004). The economic effect of implementing an EMR in an outpatient clinical setting. J Healthc Inf Manag. 18(1):4651
Hillestad R, Bigelow J, Bower A, Girosi F, Meili R, Scoville R. (2005). Can electronic medical record systems transform health care? Potential health benefits, savings, and costs. Health Aff (Millwood) 24(5):11031117.
Wang SJ, Middleton B, Prosser LA, Bardon CG, Spurr CD, Carchidi PJ. (2003). A cost-benefit analysis of electronic medical records in primary care. Am J Med. 114(5):397403.
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