Compilation shows US Veterans Administration spent the most at $16B
Clinical laboratory leaders and pathologists will be interested in which hospital systems are making the largest investments in electronic health record (EHR) technologies. Especially considering laboratory information systems (LIS) must interface with these platforms and require extensive reworking when hospitals change their EHRs. For example, hospitals moving to the Epic Systems EHR often require their laboratories to implement the Epic Beaker LIS as well.
According to information sourced by Becker’s Hospital Review, the top 16 hospital systems each spent $500 million or more on EHRs, adding, however, that the information is “not an exhaustive list.”
Number three on the list is Kaiser Permanente which operates multiple hospitals within its nine healthcare networks across the United States serving 12.5 million members. For that reason, its total investment in EHR technology represents a much larger number of hospitals than the other health systems on the list.
Of the 16 providers on the list, 12 installed EHRs provided by Epic Systems of Verona, Wis. Four of the providers implemented EHRs from Oracle Health (formerly Cerner), North Kansas City, Mo., and Meditech of Westwood, Mass.
“Looking forward, there are many advantages in terms of investing in the future and how we will be aligned with technologies including digital and AI applications,” said pathologist Angelique W. Levi, MD (above), vice chair and director of pathology reference services at Yale School of Medicine, in a news release following a site visit to Geisinger Diagnostic Medicine Institute in Danville, Pa., to see Epic Beaker in operation at Geisinger’s clinical laboratory. “But what we gain immediately—having all the patient information accessible in one place in a linked and integrated fashion—is very important.” (Photo copyright: Yale School of Medicine.)
Provider, EHR, Investment
Becker’s list below shows the total amount invested by the 16 healthcare systems was approximately $38.32 billion. The average EHR implementation cost is $2.39 billion for a large healthcare provider.
Becker’s stated they assembled this list from public sources and that there may be other EHR/hospital contracts with a total cost that also would make the list. It is not common to see a list of what hospitals actually spend to acquire and deploy a new EHR.
Epic added 153 hospitals to its client base in 2023. Epic’s EHR competitors—Oracle and Meditech—both experienced declines in client retention rate, Healthcare IT News reported based on the KLAS data.
“Both current and prospective large organization customers are drawn to Epic because they see the vendor as a consistently high performer that provides strong healthcare IT [information technology], quality relationships, and the opportunity to streamline workflows and improve clinicians’ satisfaction,” Healthcare IT News said of the KLAS report’s findings.
In a blog post, authors of the KLAS report explained that in 2023 Oracle added specialty hospital clients and Meditech “saw several new sales” which included healthcare systems and independent providers.
In the next few years, the industry is “ripe for disruption. Another vendor could come in and turn everything on its head,” the KLAS blog article concluded. “Even those who choose Epic want to have more competitive options to choose from.”
Preparing for an LIS Change
Clinical laboratory leaders who may be transitioning their LIS during a new EHR installation may learn from colleagues who completed such an implementation.
Angelique Levi, MD, vice chair and director of pathology reference services at Yale School of Medicine, who was part of the pathology team, noted that one challenge for labs is addressing “information that’s from many different places when we’re talking about cancer care, prognostic testing, and diagnostics.
“It’s become much more complicated to manage all those data points,” she continued. “Without being on an integrated and aligned system, you’re getting pieces of information from different places, but not the ability to have linked and integrated reports in one spot.”
EHR implementations are among the most labor-intensive, expensive projects undertaken by hospitals. Therefore, it is crucial that clinical laboratory and pathology leaders research and learn why an EHR (and possibly LIS) change is needed, what is expected, and when results will be received.
Even US military clinical laboratories strive to cut costs, protect quality, and improve outcomes
Defense Health Agency (DHA), a part of the federal Department of Defense (DOD), recently launched a plan to consolidate healthcare facilities within certain geographical regions and to unify and integrate the military’s clinical laboratory operations in those areas. The goal is to streamline efficiencies and lower costs while maintaining quality lab testing services.
The DOD operates a nationwide network of medical treatment facilities (MTFs) that include state-of-the-art clinical and anatomic pathology laboratories serving military personnel and their families. These military labs face the same issues of cost, efficiency, and outcomes as do civilian clinical laboratories throughout the United States.
To address those challenges and bring together clinical laboratory services in specific regions, the DHA established the Tidewater Market in April of 2021 to serve select US Air Force, Army, and Navy MTFs in the Washington DC metro area, central North Carolina, Jacksonville, and coastal Mississippi.
Tidewater is the fifth Military Health System (MHS) market created to manage MTFs as they transition into the DHA.
Health.mil—a website maintained by the MHS as an informational resource for those it serves—describes the MHS as “one of America’s largest and most complex healthcare institutions, and the world’s preeminent military healthcare delivery operation.
“Our MHS saves lives on the battlefield, combats infectious disease around the world, and is responsible for providing health services through both direct care [at military hospitals and clinics known as ‘military treatment facilities’] and private sector care to approximately 9.6 million beneficiaries, composed of uniformed service members, military retirees, and family members,” Health.mil notes.
With 9.6 million beneficiaries, MHS is one of the largest healthcare service organizations operating in the United States.
“The establishment of this market provides a true opportunity to optimize healthcare for our beneficiaries by focusing on outcomes and access across the Tidewater market,” said Navy Rear Admiral Darin Via, MD, Tidewater market manager, in an MHS/DHA news release. “It also allows us to work towards standardization of processes, creating an easier environment for our patients to navigate within.” (Photo copyright: US Navy.)
Finding Efficiencies, Optimizing Clinical Laboratory Processes and Services
In an article outlining the Tidewater Market clinical laboratory initiative, Health.mil noted that “A market is a group of MTFs in one geographic area working together with its TRICARE partners, Veterans Affairs hospitals, other federal healthcare organizations, private sector teaching hospitals and medical universities, as well as other healthcare partners. Markets operate as a system to support the sharing of patients, staff, budget, and other functions across facilities to improve readiness and the delivery and coordination of health services.”
The Tidewater Market provides integrated, affordable, high-quality healthcare services to active-duty service members, military retirees, reservists and national guardsmen, and their families. The market currently serves more than 390,000 beneficiaries.
In 2022, the Tidewater Market Laboratory/Pathology Integration Working Group was created to optimize services while reducing costs within the market. The group was created by US Navy Captain Stacie Milavec, who has more than 23 years of experience in military medicine.
“One of DHA’s goals with setting up a market structure is to find efficiencies and optimize and standardize processes and services wherever possible,” Milavec said in an MHS/DHA news release. “We’ve been able to do exactly that by collaborating within our working group.”
Resource Sharing between Military Clinical Laboratories
The MTFs that are geographically close to each other helped expedite turnaround times for testing results. By working together, they saved the Tidewater Market an estimated $80,000 during fiscal year 2022.
One of the methods they used to streamline testing and lower costs was to allow resource sharing between facilities within the market. For example, the full-service clinical laboratory located at the Naval Medical Center Portsmouth (NMCP) began performing head and neck pathology cases, breast biopsies, and PAP testing for some of the other facilities within the Tidewater Market. These services were previously performed by other means and in some cases were sent to commercially-contracted clinical laboratories for analysis at a high cost.
The NMCP also took on Human Papilloma Virus (HPV) testing for all MTFs within the market.
In February of 2023, NMCP began taking on additional clinical chemistry tests from the 633rd Medical Group at Joint Base Langley-Eustis located in Hampton, Virginia. Prior to that collaboration, those tests were sent out to contracted labs off-base for analysis.
“[Through collaboration between the MTFs] we’ve been able to successfully transition civilian marketplace send-out testing back into the military market by utilizing market resources,” said pathologist US Air Force Captain Dianna Chormanski, MD, Laboratory Medical Director with the 633rd Medical Group at Joint Base Langley-Eustis, in the press release. “I’m a big fan of cooperation and working together, and that’s what a market should be.”
The DHA established the market-based structure as part of the National Defense Authorization Act for Fiscal Year 2017. It’s an example of regional laboratory consolidation within one region of the US where a common effort brought together clinical laboratories operating on military bases of different services. The military’s goal was a unified, integrated medical laboratory operation that could deliver targeted cost savings while maintaining quality lab testing services. It appears to be successful.
