TEMPE, Ariz. (April 30, 2010) — Most Americans will likely have their health information turned into electronic medical records over the next decade. A large chunk of federal stimulus money is being used for this effort aimed at improving patient care and reducing medical errors. However, a new study from the W. P. Carey School of Business at Arizona State University shows there are some real negatives that come with the positives of electronic medical records.

“Everyone has been saying that health IT will save money, but our study and others cast doubt on some of the savings,” explains Assistant Professor Michael Furukawa, one of the study’s authors. “The bottom line is that electronic medical records do appear to help lower mortality rates at hospitals, but they don’t necessarily help reduce the number of patient medical complications or reduce costs, especially in the area of nursing.”

Furukawa and his colleagues, Associate Professors Raghu Santanam and Benjamin Shao, analyzed data from more than 300 California hospitals that adopted some form of electronic medical records over a decade from 1998 to 2007. Their research was just published by the journal Health Services Research. Contrary to expectations, they found electronic medical records implementation was actually linked to higher hospital costs, and in some cases, lower quality of care.

“There’s a disconnect in the policy world that assumed that with all of the records moved into the computer system, nurses and other hospital personnel could spend less time running around looking for charts and that they would have more time to spend with patients,” says Santanam. “While some documentation time was reduced, a lot of time at computers may have been added, especially at organizations just learning to implement the new technology in a likely transition period. Higher levels of nurse staffing were really needed.”

The study did find that hospitals saw better results from the use of electronic medical records as their implementation and techniques got more advanced, so cost savings may improve at hospitals over time. Also, less money was spent specifically on overtime for nurses, presumably because personnel began to enter data into the computers as their shifts progressed, instead of waiting until the end of the shift to write everything onto paper charts.

However, patient hospital stays got longer in many cases, possibly because using the computer systems took nurses away from their work caring for patients. Also, more highly educated nurses were required to efficiently use the new systems.

“This could have real implications for the labor market nationwide,” says Shao. “Some areas already have registered nurse shortages, and that problem could be exacerbated with the implementation of electronic medical records.”

On the positive side, hospitals experienced lower death rates for certain conditions. The electronic medical records also contributed to fewer medication errors and may have resulted in less ordering of unnecessary, duplicate tests.

“We’re not saying electronic medical records aren’t the way to go in the future for the purposes of information-sharing and reducing medical errors,” says Furukawa. “However, health practitioners, hospital managers and policy makers should temper their expectations of short-term savings from health IT. This is just a reality check that implementing these systems may be more challenging than expected.”

“Most hospitals still aren’t rethinking how they do things; they’ve just been integrating the electronic medical records into their current processes,” explains Santanam. “They may need to completely reexamine their processes to maximize the new technology. Maybe they just haven’t realized the full potential.”

The new study was partly sponsored by the Center for Health Management Research, a program of the Health Research and Educational Trust. The results of the study called “Electronic Medical Records, Nurse Staffing, and Nurse-Sensitive Patient Outcomes: Evidence from California Hospitals, 1998-2007” can be found at http://www3.interscience.wiley.com/cgi-bin/fulltext/123346351/PDFSTART.