Concerns that nationwide electronic health record adoption could lead to widespread fraudulent coding and billing practices that result in higher healthcare spending are unfounded, according to a study from the University of Michigan School of Information and the Harvard School of Public Health.

The study, by Julia Adler-Milstein, assistant professor of information at Michigan, and Ashish K. Jha, Harvard professor of public health, is published in the July issue of Health Affairs.

“There have been a lot of anecdotes and individual cases of hospitals using electronic health records in fraudulent ways. Therefore there was an assumption that this was happening systematically, but we find that it isn't,” said Adler-Milstein, who is also an assistant professor of health management and policy in the U-M School of Public Health.

To examine these claims, the researchers analyzed longitudinal data to determine whether U.S. hospitals that had recently adopted EHRs had greater subsequent increases in the severity of patents’ conditions and payments from Medicare, compared to similar hospitals that did not adopt. The research focused on hospitals that would be likely to change their coding practices: for-profit hospitals, hospitals in competitive markets, and hospitals with a substantial proportion of Medicare patients.

Despite widespread stories and concerns among policymakers about the potential for EHRs to increase fraudulent billing, the authors found that adopters and non-adopters increased their billing to Medicare at essentially identical rates. They found the same results among the groups of hospitals most likely to use electronic health records to increase coding and revenue.

With no empirical evidence to suggest that hospitals are systemically using electronic health records to increase reimbursement, the study’s findings should reduce concerns that EHR adoption by itself will increase the cost of hospital care.

The results also suggest that policy intervention to reduce fraud is not likely to be a good use of resources. Instead, the authors recommend that policymakers focus on ensuring that hospitals use EHRs in ways that are most likely to reduce healthcare spending and improve the quality of care.

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