Lost productivity: the scourge of your EHR cost calculations

EHR users are likely aware of the total cost of ownership (TCO) or a comprehensive assessment of EHR costs related to implementation over time. The basic costs related to an EHR system, are often easily anticipated. However accounting for the fundamental costs of ownership without accounting for some of the hidden costs often missed in a TCO calculation can be a costly error, particularly when justifying an EHR system’s ROI over the long-term.

Intangible Costs

Before diving into the likely hidden costs, let us clarify some terminology. Hidden EHR costs are not hidden in the sense that it takes a sharp eye to find them. Rather, these costs, are aptly described as “hidden in plain sight.” They involve elements that are attached to commonly recognized elements of TCO, but often escape calculation since they are often difficult to model and linger in the shadows of other expenses.

Lost productivity, is best described as a single cost caused by many factors.

For example, the costs related to *training staff on an EHR system are easily captured in a TCO calculation. However, how does one account for the tangible value of staff frustration when trying to learn a new system or the distraction of IT staff from their usual duties during an implementation of a new system? The intangibility of these hidden EHR costs explains how a TCO analysis often overlooks them.

Lost Productivity

When a new EHR system is implemented, or existing software is upgraded, users must reorient themselves and learn a new interface or an entirely different method of using EHR. As a result, learning the new system or adapting to slight changes results in lost productivity.

Lost productivity, is best described as a single cost caused by many factors. It is well documented that out of pocket, direct costs for software updates and patches likely represent the greatest cost factor that is not considered when rolling out a new EHR system. An EHR platform that requires frequent updates and patches to maintain functionality can cause a provider to suffer a slow bleed from costs. However a more long-term and often ignored result of upgrades and patches is the lost productivity as staff are disrupted due to system changes and the process of adapting to these changes in the system or those staff which are frustrated by a system which has a steep learning curve and thus slows down workflow.

Recommended reading: EHR software pricing guide - get a headstart on your cost and budget research

Lost productivity can be difficult to quantify from the perspective of direct economic costs. Accurate loss of productivity data is not easily measured across settings; however a significant amount of survey data collected shows lost productivity is a common and serious consideration when implementing a new EHR or updating an existing system.

A study conducted by Medical Economics provides one of the most thorough attempts at accounting for lost productivity. The study indicates that during the peak portion of the implementation period, “you can expect to see up to 50% fewer patients.” In calculating actual economic costs from lost productivity the study states a useful hypothetical, "If you're putting in a new [EHR] system and it takes you 1 minute more per patient, that half hour [per day] is two billing slots…If you're getting $74 for a patient visit, then it's $150/day times, maybe, 200 days, your office is open. That's $30,000 per year." Given these estimates of loss in productivity, one ignores this EHR cost at their own peril.

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Jeff Green

About the author…

Jeff Green, MPH, JD works as a freelance writer and consultant in the Healthcare information Technology Space.

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Jeff Green