Five Reasons We Think RECs Are RECkless

Updated October 15th – Three weeks ago we launched a poll asking, “Will Regional Extension Centers deliver on their mission?” With the help of fellow bloggers, we received a total of 87 responses from physicians, health IT insiders and other health care professionals. Thank you to those who participated and to those who helped us spread the word about the poll.

Out of the 87 responses we received, 62 respondents – or 71% – think RECs will not deliver on their mission. The remaining 25 – or 29% – think they will. We understand 87 responses may not be enough to establish definitive conclusions, but we think it’s a pretty good turnout given the topic. Not to mention, we received over 50 comments from our participants. We compiled a list of the responses and placed them in a Google Doc here. For quick reference, we also put together a list of the three most common reasons respondents answered “Yes” or “No.”

Top three reasons RECs will deliver on their mission:

1. Regional Extension Centers (RECs) have a thorough RFP and evaluation process when choosing preferred vendors. Therefore Physicians will rely on RECs to help narrow down the options because they don’t have the time and resources to do it themselves.
2. Primary care providers need a person to support and coach them through the process of implementing an electronic health record (EHR) system. RECs will be staffed with health care professionals that have first hand knowledge and experience of implementing EHRs in real clinical settings.
3. EHR software vendors may not provide enough support to help providers reach “meaningful use” status. Additionally, some providers may not be able to afford their vendor’s support services. Many will choose to work with RECs instead.

Top three reasons RECs will not deliver on their mission:

1. Preferred vendor lists are not preferred by all. RECs are selecting brand-name companies and these EHR systems aren’t a good fit for all providers. There is also some concern that RECs are hiring consultants that have existing relationships with certain vendors.
2. The infrastructure and expertise RECs are expected to build in such a short time seems overwhelming. There are not enough professionals with the requisite expertise and not enough time to train others on the implementation, change management and other support activities needed to help physicians become meaningful users of EHRs.
3. The amount of funding that is being set aside for each provider is not sufficient to get resources and personnel to do the job. Exacerbating the issue, RECs will be competing with software vendors for top talent. There is also concern that RECs are diluting money that could be available for other, more effective initiatives.

Original Post – One of the major components of the the American Recovery and Reinvestment Act of 2009 (ARRA) was the allocation of $19 billion to jump start the adoption of electronic health records (EHRs). One of the major uses of those funds was the establishment of Regional Extension Centers (RECs) to support EHR adoption by primary care physicians.

The entity spearheading this effort, the Office of the National Coordinator for Health IT (ONC), is specifically charged with helping 100,000 priority primary care providers become “meaningful users” of EHRs in 24 months. Eight months have passed since the ONC began funding RECs, and we’re skeptical that they will deliver.

Don’t get us wrong. We’re big advocates of EHRs. We’re glad to see such an energized EHR market. We’re just skeptical that throwing money at the problem will lead to efficient and successful adoption of this important technology.

In our opinion, there are five fundamental flaws with RECs:

1. Doctor’s aren’t moving as fast as the money is flowing
2. The market already delivers on what RECs promise
3. “Preferred vendor lists” limit choice and free markets
4. RECs won’t get doctors to “meaningful use” fast enough
5. The REC model leads to under-staffed, ephemeral entities

We’ll explain each in a moment, but first I want to put this all in context. EHRs and stimulus funds aside, physicians are generally discontent with the government’s intervention in health care. They have suffered under Medicare reimbursement cuts, they cringed during health care reform and they generally feel that big business – payers, pharma and hospitals – prosper by working the system, while individual providers get squeezed.

As a result, physicians are naturally skeptical of government programs, RECs included. Why then, when the Federal government says, “Jump!” would we expect physicians to ask “How high?” Instead, I think what we’re hearing from doctors is a curious, “Why?”

1. Doctors Aren’t Moving as Fast as the Money is Flowing
The eHealth Initiative recently hosted a survey to find out how RECs are progressing toward their objectives. Of the 60 RECs polled, 42 responded. The results are disappointing.

As of July 31st, 18 RECs have not signed up any providers. Another seven RECs reported that just 20% of providers they contacted have agreed to participate. Why aren’t doctors signing up?

One possibility is that providers were waiting for the final ruling on “meaningful use.” The Department of Health and Human Services (HHS) announced the final rules on July 13th, about the same time the eHealth Initiative held their survey.

Another possibility could be that doctors don’t know RECs exist. John Lynn, author of the EMR and HIPAA blog, posits that 90% of doctors have never heard about the millions of dollars RECs have available to help implement EHRs. He admittedly invented this statistic, but he makes a good point. Maybe the ONC should have set aside a percent of funds for sales and marketing?

We think bad press is also to blame. It seems like one out of every three articles highlights the shortcomings, not benefits, of RECs. Health IT insiders, software vendors and political pundits are all weighing in. Of course, we’re obviously just fanning the flames with this blog post.

Nevertheless, there seems to be something else deterring doctors from getting on board…

2. The Market Already Delivers on What RECs Promise
What do RECs offer that the market doesn’t? We find ourselves asking this over and over again. It’s the foremost problem with RECs; they don’t have a strong value proposition.

RECs are tasked with three main duties:

• provide training and support services to assist providers in adopting EHRs;
• offer information and guidance to help with EHR implementation, and;
• give technical assistance as needed.

This is great except health IT consultants, software vendors and third-party research firms already offer these services. Not to mention, EHR software vendors provide implementation, training and support themselves. It’s unlikely an REC will be more efficient than a software vendor at supporting it’s own system.

So do we really need another player in the market? Sure RECs are highly subsidized to support the provider, but is this the right trusted advisor for a practice betting its entire operation on a new system?

REC campaigners might point to other benefits like “group purchasing” as a reason to join. But group purchasing doesn’t help if it interferes with free market forces. This brings us to our next point…

3. “Preferred Vendor Lists” Limit Choice and Free Markets
It’s no secret that RECs are already choosing “preferred” EHR vendors. Just last week the Massachusetts Regional Extension Center released a series of press statements announcing their selection of Greenway, NextGEN, GE, eClinicalWorks and athenahealth as preferred products. No surprises here. These companies are well established in the market and have the resources to support the addition of several thousand users. They are excellent at what they do.

The problem is, “one-size-fits-all” doesn’t apply when it comes to implementing EHR software. We should know. We have helped several thousand practices with their software research. Size, type of practice, budget, feature requirements and more all play a role in the purchase decision. So, given the variety of practices that will make up an REC, preferred EHR products won’t be a good fit for all. There is a vibrant market of specialized EHRs that cater to unique needs.

Moreover, we think that the establishment of preferred vendor lists drive the market toward oligopoly. Fewer choices mean more vendor leverage, which leads to higher prices. If each state chose five vendors and the choices are largely consistent, that could drive the consolidation of 300 – 400 EHR vendors down to about a dozen. We see the need for consolidation, but not to that extent and outside of natural market forces.

Here’s another example. The Virginia Health Quality Center (VHQC) has selected Allscripts, athenahealth and MDLand as their preferred vendors. All three of these systems are web-based. While web-based or Software as a Service (SaaS) systems have been lauded as the future of successful technology, many rural physicians along the East Coast lack access to broadband service. So if Internet access is unavailable, how will they access their new electronic patient records?

4. RECs Can’t Get Providers to “Meaningful Use” Fast Enough
To qualify for incentive payments in 2011, providers need to demonstrate meaningful use of a certified EHR for a period of 90 days. This means providers need to be up and running before October of 2011, just 12 months from now. Can providers rely on RECs to get them there?

Neal Ganguly, CIO of CentraState Healthcare System in New Jersey, suggests it can take three to six months to research and select a system, two to five months to install it and six to 12 months to “work out all the kinks” and become productive. Based on this timeline, you could be approved by next September at best. If it takes the maximum amount of time for each step, you would start the reporting period in February of 2012, missing the extra $18,000 by a few months.

Of course either scenario assumes that you are already signed up with an REC or purchased an EHR. It also assumes your REC is fully operational. Which brings us to our next concern: who will run RECs?

5. The REC Model Leads to Under-Staffed, Ephemeral Entities
Regional extension centers are required to help 1,000 providers become meaningful users. They must reach this goal within 24 months of receiving funds. So, the 32 RECs funded in February have 17 more months to reach this goal; the other 28 funded in April have 19 more months. Divide 1,000 providers evenly over 17 to 19 months and this means RECs would have to support 50 to 60 providers a month. Where are they going to find enough employees to support this demand?

In an article for Healthcare Informatics, Anthony Guerra makes it sound nearly impossible:

“Even if all currently employed healthcare IT consultants were suddenly transferred from their employers and distributed appropriately to the new RECs, it’s doubtful enough manpower could be found to fuel these embryonic organizations.”

Lending credibility to Guerra’s statement, a Health Affairs study found that RECs might be too understaffed and underfunded to provide the help physicians need. The author says RECs need consultants that have technical knowledge and direct experience working with small practices. Finding individuals with experience in both software implementation and work-flow adaptation in a practice is hard.

The study also raises concern over funding. Similar projects in Massachusetts and New York spent approximately $60,000 to $80,000 per physician. RECs average $6,620 per physician.

Wrapping up, we think these are the main five reasons RECs won’t survive. But all of them lead to one thing we know to be true: physicians have to want to implement EHRs because they truly believe in the promise of this technology. Truly meaningful use will require physicians’ conviction that EHRs will improve the practice of medicine, the profitability of private practice, and the lifestyle of the provider. Only that conviction will motivate physicians to take charge and lead their practice’s adoption of EHRs.

We don’t like to be pessimists, but the REC program just seems, well, RECkless.

Be sure to come back next week when we report the findings of our poll. In the meantime, feel free to share your opinion in our comments section below.