Last Updated | September 5, 2024
Remember the time when you carried a pile of previous medical reports and prescriptions to every hospital visit? Technology has revolutionized our way of living, and paper chaos is over. Whenever a healthcare provider talks about implementing Electronic health records (EHR). The first question is, how much does an EHR cost? EHR software has recently become customary and transformed how care providers conduct patient care.
Implementing best EHR for solo practices or hospital chains isn’t too complicated. However, the cost is a factor that can often be a roadblock. EHR implementation costs can be divided into parts based on the vendor’s needs. Many practitioners believe EHR is a one-time investment, but we’ve revealed the reality through logistical breakdowns and expenses you might not have expected.
Executive Summary: EHR Implementation Cost Breakdown
Current Situation
It is essential to understand the actual cost of implementing an Electronic Medical Records (EMR) system, especially for healthcare facilities of differing sizes. Large hospitals have hefty budgets for such projects, but smaller practices and clinics have budget constraints, making managing such expenses critical. This article specifies the associated aspects of an EHR implementation cost breakdown.
Actionable Advice
It’s essential to develop a clear financial plan to ensure that the EHR implementation costs stay within budget. This blog highlights insights into how to approach budgeting for your EHR system, from initial setup to ongoing maintenance and potential unexpected costs. The suggestions covered here help both those seeking EHR for solo practices and large hospital networks.
Impact of Software Type on EHR Implementation Cost Breakdown
The software chosen for the Electronic Health Record implementation should be the talk of the town to improve one’s practice’s efficiency, patient care, and overall healthcare workflows. Choosing the right EHR software can satisfy your goals for error-free operations and improved care outcomes.
It’s important to find a system satisfying your practice’s needs and then select from the widely available EHR solutions, such as Cerner, EPIC, eClinicalWorks, and Allscripts. Whether you are a healthcare specialist, primary care service provider, or the owner of an Ambulatory Surgical Center (ASC), choosing the right EHR customization directly impacts your EHR implementation costs.
Licensing Models
There are two different EHR pricing models. The chosen EHR systems for hospitals are based on several factors, including the most suitable for their needs and budget.
Per-User Fees
Revenue for this model is paid each time an authorized user is registered and consists of either a monthly or a yearly subscription fee. It predictably scales with the size of your practice.
Per-Facility Fees
In this case, you pay a fixed amount for the entire structure, but it does not matter how many people there are. This could be cheaper overall for bigger practices but may not allow much flexibility for smaller ones.
Direct & Indirect Costs Of Implementing EHR In Hospitals?
Whether you want to create a medical app or implement EHR systems in hospitals, the final cost of implementation remains the most pressing concern for all healthcare businesses. That being said, healthcare organizations need to plan and prepare for EHR implementation to avoid any delays in the middle of the implementation. In the section below, we are sharing everything you need to know about the costs of implementing EHR systems in hospitals.
Direct Costs: Infrastructure & Integration
The direct costs of implementing EHR in hospitals are more than just purchase and license, the hardware infrastructure such as servers and network upgrades are required to complement the EHR systems installed in various departments. Additionally, integrating the EHR system with the present legacy systems demands experts with IT prowess and knowledge, summing up more costs.
Indirect Costs: Training & Operations
The scalability of operations in hospitals amplifies the indirect costs of implementing EHR. These types of costs include comprehensive training programs that help onboard a large group of workforce and the cost to manage downtime during the time of transition. Hospitals should be wary of the cost related to the integration of EHR systems with the currently installed legacy systems, which demands personnel with exhaustive IT understanding. Even the trivial inefficiencies within the complex nature of the hospital workflows can cause major financial consequences, hence such costs should be thoroughly planned upfront.
It’s important to choose from the top healthcare software companies in the USA, so you get the full worth of your investment.
EHR Implementation Cost Breakdown: The Hardware
Your practice must also acquire the computer, server, and networking gadget needed to access and utilize your EHR software. Your choice determines whether or not you will develop a secured server on which the software and data will be stored.
Alternatively, if you opt for a cloud-based model, a hospital can connect with the EHR provider or a separate hosting provider to host and store your data. Choosing the cloud will reduce the initial investment in data hardware.
This suggests that off-premises systems require more initial investment in infrastructure due to EHR deployment. Cloud-based or SaaS systems require lower software and hardware infrastructure investments since your data is held at the vendor’s servers and accessed via a web browser.
You should also evaluate your computing and networking adequacy for any EHR system. The major causes of poor EHR performance are slow computers and laptops, poor Internet connections, and network infrastructure issues. New equipment must be purchased depending on the compatibility level with the new EHR.
EHR Implementation Cost Breakdown: Implementation Support
Several operations rely on support from various professionals to implement an EHR system. These include project managers, trainers, analysts, consultants, and programmers. The hospital might need help from an external party like Digital Health Folio3 that can assist with all aspects of the project, such as plan development, customization, ergonomic considerations, workflow redesign, training, and customer support.
With expert implementation support, your EHR system can work faster and save you money in the long run. The pricing of implementation support depends on the desired level of assistance. Integration aid also helps in adopting quality practices and ensures successful EHR application.
Implementing EHR comes with its own set of costs, and implementation support plays a significant role in the overall budget. Healthcare organizations can expect to spend 15-20% of their EHR implementation budget on support services. Medical Group Management Association revealed the average per-hour costs for EHR as follows:
- Project management: $100-$200 per hour
- System configuration: $150-$300 per hour
- Data migration: $50-$200 per patient record
- Training: $50-$150 per hour per trainee
- Go-live support: $200-$500 per hour
Cost of Training & Managing Productivity Losses During EHR Implementation
We pondered over the training need being the critical factor in EHR implementation for hospitals. This is due to the complex nature of the system and diverse staff that require proficiency in using them.
Training Costs: A Large Scale Investment
Hospitals in comparison with the small-scale practices have specific needs and workflows, requiring to coordinate training across multiple care departments. This asks for a more detailed and prolonged training duration, which increases costs significantly. Appropriate training ensures that every individual is equipped with the knowledge and skills to utilize the EHR system, reducing the pitfalls of human errors and workflow inefficiencies that eventually may lead to higher indirect costs.
Productivity Losses: Mitigating the Impact
The scale of operations in hospitals is such that even the minor drought in productivity may cause serious financial implications. Hospitals should opt for phase-wise roll out of EHR implementation to subside the losses, this allows different departments to become accustomed to the change while being under the constant supervision of “master users” — highly trained personnel who can provide on-ground assistance when needed. These strategies can sustain operational fluency and mitigate the financial consequences due to productivity shortcomings.
Key Things to Consider in the Ongoing Costs of EHR Implementation Cost Breakdown
Implementing an EHR system entails ongoing costs, including direct costs like setup and maintenance, indirect costs such as workforce training, and variable resource-related costs, depending on whether your system is cloud-based or on-premise. Furthermore, unexpected costs can also rise and for that, you need to have a solid plan in place. For a more detailed understanding of these costs, you can refer to the guide on EHR implementation cost breakdown in hospitals.
Custom EHR Costs
Every practice has some unique set of requirements. For example, a hospital offers remote patient monitoring or telehealth solutions or uses medical billing software; in this case, the integration would add to the base cost. Opting for general EHR without customization can rely on an available solution.
A custom EHR software for mental health could be more appropriate because it has it’s own unique sets of features needed by therapists like multiple assessments and evaluations for specific types of issues. In the same way, EHR in nursing practice, pediatricians, surgeons, hospices, and other practices with a limited specialty require features that are more relevant to them for better patient care. Although a custom EHR may seem expensive initially, it’s a terrific method to avoid spending money over time.
Upfront Cost |
Yearly Cost |
5 year TCO |
|
| Cloud EHR | $26,000 | $8,000 | $58,000 |
| On-premise EHR | 33,000 | 4,000 | 48,000 |
EHR Implementation Cost Breakdown & Compilation
Electronic medical records software cost breakdown often leads to the answer depending on the features and other functionalities. The expense of an EHR varies based on the components purchased and the intended duration of use. This blog provides insights into how an EHR system implementation is financed and the costs incurred during implementation.
1. Medium of Deployment- Cloud or On-Premises
EHR software can be deployed in the cloud or on the premises. Both mediums have their own unique set of features and advantages. Using a Cloud-based medium for your data allows applications to be hosted in the vendor’s secure cloud environment. This eliminates the need for on-site IT infrastructure and offers greater scalability and accessibility.
On the other hand, hospitals can install and manage EHR software on their servers by utilizing on-premise installation. This gives them more control over their data but requires significant upfront investment in hardware and IT expertise. Cloud-based deployments typically have lower upfront costs but ongoing subscription fees, while on-premise deployments have higher upfront costs but lower ongoing fees.
2. Cost of Top-Notch EHR
It is difficult to pinpoint an average cost for an EHR system because the costs differ based on the specific setting and plan. Specific cases give an understanding of implementation costs. One report published in the journal Health Affairs. for example, highlighted the typical amount of money multi-physician practices spend on EHR setup and maintenance. In the same way, primary care offices’ spending on gadgets, software, hardware, and support services was pointed out in Medical Economics research. Due to their greater scope, hospital EHR implementation expenses fluctuate widely throughout community hospitals.
3. Hidden Costs
Licensing is only the tip of the iceberg. Implementing EHR in healthcare and your practice comes with several hidden costs, which often get overlooked when calculating the cost of implementation of EHR in the hospital.
Implementation Fees
These include the initial installation and configuration of your EHR system, where some aspects, such as data migration, are involved.
Training Fees
When introducing a new system, your staff learns it well. Training costs can be either per user or as part of the implementation package.
Customization Costs
Want to make adjustments to EHR under your unique workflow? Be aware of other personalization expenses.
Integration Fees
Connecting your EHR with other systems, for instance, labs or billing software, is costly because of integration.
Maintenance Fees
EHRs are software; thus, they must be constantly maintained and upgraded. This cost provides you with new features and bug configuration.
Cost-Benefit Analysis of EHR Implementation
With EHR implementation and adoption, returns on investment are a common obstacle. However, healthcare organizations need to have a clear idea about ROIs to encourage the adoption of the technology. Similarly, they need to ensure the correct integration of the EHR system to ensure the healthcare outcomes are practical, and cost-benefit analysis can help answer these questions and help clear confusion regarding financial decision-making.
This is because cost-benefit analysis helps determine the monetary value of costs and benefits of EHR systems. The analysis covers four steps: determining the goals, estimating the benefits and costs in dollar amount, and discounts at an appropriate price. The last step is completing the cost-benefit analysis based on decision-making calculations.
Key Factors Influencing EHR Implementation Costs
Long-Term Costs of EHR Implementation and Maximizing ROI
The long-term costs for hospitals account for more than just basic maintenance and updates.
Ongoing Investments: Security, Compliance & Updates
Healthcare regulations are stern for patient data security and interoperability standards, hence to make the EHR system compliant, continuous investments are needed. Hospitals also need to plan for continuous staff training to keep up with the system updates and new EHR features.
Maximizing ROI: Beyond the Initial Implementation
Despite the hefty investments and rising costs of implementing EHR systems, they can result in greater ROI by using them to enhance patient care quality, operational excellence, and improve revenue cycle management. For instance, use of EHRs can curtail the occurrence of medical errors, optimize resources, and improve billing accuracy, cumulatively improving the financial performance with time. However, such ROI realization requires meticulous planning and commitment to using EHR system to the best of its potential.
Segmenting EHR Implementation Cost Breakdown by Facility Type
Implementing an EHR system differs widely in cost depending on the type of healthcare facility. The breakdown below highlights potential expenses across different facility types:
Small Clinics:
Initial setup costs are usually on the lower side for the small clinics, but the relative impact on their budget can be substantial. The costs for implementing EHR in small practices or clinics include licensing fees, minimal hardware upgrades, and essential staff training. Small clinics are challenges in finding affordable and scalable EHR solutions that don’t require costly upgrades as the practice grows.
Multi-Site Hospitals:
Large hospital networks situated in multiple locations face higher upfront costs, which include extensive hardware infrastructure, advanced measures for data security, and exhaustive staff training programs. However, they also leverage economies of scale, thereby curtailing the per-user cost. Furthermore, these hospitals may need detailed customizations to integrate the EHR with existing systems to further enhance the overall expense.
Costs of Popular EHRs
Electronic health records cost of implementation has a variety of associated costs. One of the frequently asked questions is how much Epic ehr costs for a small practice. Based on the popularity of epic EHR. There are numerous EHR software available, such as over-the-counter and customization.
The cost of the top 5 EHR systems varies depending on several factors, such as Practice size and specialty. However, 96% of practices use any type of EHR software. Specialists often require more features and customization, leading to higher costs. Cloud-based solutions are typically less expensive upfront than on-premise systems but may have ongoing subscription fees. Different vendors have different pricing models and feature sets. However, here’s a general overview of the costs associated with some popular EHRs.
| EHR System | Pricing Model | Typical Cost per User/Month as of 2024 |
| Athenahealth | Subscription | $140 |
| Meditech | Perpetual license or subscription | $49 |
| Cerner | Subscription | $25 |
| Epic | Subscription | $200 (for basic functionalities) -$35,000 (for advanced functionalities) |
| eClinical | Subscription | $449-$599 (for EHR with practice management) |
Factors Affecting EHR Costs
There are many factors that influence EHR costs. Vendor pricing models and ongoing maintenance outshine the rest but are often underestimated drivers of the total cost.
Vendor Pricing Models:
The cost structures vary from vendor to vendor. Subscription-based models may seem affordable initially, but costs can pile up as time progresses, and the practice expansion requires additional licenses that accumulate more expenses. On the other hand, one-time purchase models often come with high upfront costs but may become cost-effective in the long term.
Long-Term Maintenance Costs:
EHR systems demand frequent updates to stay in compliance with the new industry regulations and to maintain data security. These updates create ongoing costs, which need to be considered in the overall budget. For instance, practice should consider keeping funds for additional IT support or for retraining their staff when such updates are rolled out.
How to Control Costs of EHR
EHR Development plan for a healthcare organization revolves around cost and benefit analysis and emphasizes cost control. Although EHR systems offer multiple benefits, evidence has shown that organizations tend to recoup their implementation costs after two to three years.
Healthcare providers highlight budget constraints as a hindering factor for the digitalization of healthcare. To control the cost, doctors involved with implementation poured in suggestions. These will also help minimize the cost of EHR systems for hospitals and private practices.
1. Installing Open-Source EHR
Utilizing an open-source EHR system might result in a user interface that is not perfectly buffed. However, it is capable of delivering essential functionalities at minimal or no cost at all. Sometimes, healthcare organizations lack the IT expertise to implement open-source solutions or need additional features. Hiring a developer could be a more economical alternative than selecting a proprietary EHR solution.
2. Select Only The Required Features
Before making the decision, it is essential to do a market analysis to grasp the cost breakdown of electronic health records. This helps in the identification of important functions a healthcare organization would need to run smoothly. Opting for features and integrations is the right approach to avoid unnecessary costs. This approach helps optimize costs, ensures a suitable EHR solution is chosen, and provides the option of scaling over time.
3. No Compromise On Security
Medical data is sensitive, and security must be given top priority by healthcare companies when evaluating cost-cutting strategies for EHR deployment. In the healthcare industry, data breaches are common and often expensive. Choosing an inexpensive system with inadequate security features can lead to costs significantly greater than those incurred by purchasing a more trustworthy and premium solution.
4. Pick A Subscription-Based Model
Solutions that facilitate annual subscription payments could be a good solution for healthcare organizations concerned about upfront costs. This strategy offers flexibility even if it may result in a higher total cost of ownership. This allows companies to change or modify their service plans as needed, allowing the budget to account for unanticipated expenses and allowing for adjustment.
5. Collaborate With An Experienced Vendor
Experienced software companies like Digital Health aim to demonstrate their efficiency in implementing EHR optimally. As a result, they can help healthcare organizations optimize costs by identifying areas that require attention. These companies provide skilled teams that expedite implementation, leading to reduced EHR project costs and prompt utilization of system benefits. This approach is crucial to maximize cost-effectiveness and fully leverage the benefits of the EHR system.
What Are The EHR Adoption Barriers?
To begin with, the upfront cost of EHR adoption is the most significant barrier, but there are other barriers, such as ongoing costs, maintenance costs, technical support, and technical glitches. In the section below, we are sharing deeper insights into EHR barriers, such as;
Cost
Designing and implementing new technology as big as an EHR system is expensive, and the cost is the biggest barrier. For this new technology, the maintenance and upfront costs are ridiculously high, and it can be challenging to assess the cost-benefit of patients and technology. Even more, getting such capital from the authorities for the EHR system will be challenging. However, calculating the accurate cost of implementing EHR will help persuade the authorities to provide funding.
Regulations
Yes, excessive regulations and legalities are one of the biggest barriers. Generally, they focus on the security and privacy of healthcare data transfer. In addition, it also includes the state licensing laws, HIPAA compliance services, regulations, abuse, fraud, and intellectual property laws. Multiple rules will have an impact on the adoption of an EHR system and HL7 integration.
Time
It’s another barrier to EHR implementation when looked at from the healthcare provider’s point of view. The time barriers include acquisition, education, implementation, utilization, and testing of new technology. Similarly, healthcare providers hardly have time to indulge in EHR system training. On top of everything, healthcare providers need to be assured that a new system won’t increase the treatment time or workload and that everything will be streamlined.
Change Management
Yes, change management is one of the biggest barriers to EHR implementation because it can negatively impact documentation, patient treatment, and workflow. The technology indeed can transform the healthcare system, but it requires overcoming the challenges. For this reason, the risk managers need to tell the staff that concern and trust issues can be overcome. You need to inform the healthcare providers that the EHR system will streamline patient care and healthcare workflow. In addition, keep in mind that UI design in healthcare plays an essential role in adopting a new system, so make it easy!
Perception
New technologies are often rendered complicated and hard to learn, and it’s another barrier that can impact EHR implementation. To ensure it doesn’t affect healthcare quality performance, the system must be integrated with the current workflow, and the interface must be easily accessible and easy to use. All in all, the perception can only be changed by showing that a system is easy to use. Lastly, show them that a new system is designed while complying with regulations of healthcare compliance services, so they are sure about the effectiveness.
Conclusion and Recommendations
Implementing an EHR system in hospitals is more than just a technical hurdle but a strategic change that astoundingly boosts financial health for the hospital facility and improves patient care outcomes.
Actionable Advice for Hospital Administrators
Hospital administrators must come up with clear understanding and planning to approach EHR implementation to manage the costs effectively. From initial setup to being aware of the long-term expenses related to maintenance, training and system upgrades, the budget must include all. This strategic approach in planning for the EHR implementation in the hospitals ensures their compliance with the strict healthcare regulations as well as positioned well within the industry to reap the full benefits of the EHR system.
After grasping the complexity and variability of EHR costs, it’s important to customize your approach based on your healthcare organization’s specific needs regarding implementing EHR. For solo or small practices, investing in a scalable, cloud-based EHR system might be the cost-effective pick, while large hospital networks can benefit from a tailored EHR solution that can integrate with existing infrastructure.
Below are some targeted recommendations:
For Small Clinics/Solo Practices
Your focus should be on vendors that offer flexible pricing models and cloud-based EHR solutions, which minimize upfront costs and reduce the need for extensive IT infrastructure.
For Large Hospitals
Seek options to invest in a customizable EHR system that may be expensive in the beginning but will provide long-term benefits through seamless integration and scalability.
Frequently Asked Questions
What type of costs are gradually lessened once an EMR/EHR system is in place?
Once done with EMR/EHR system implementation, several costs are bound to decrease:
Paperwork Costs:
The expenses linked to manual paper records, including printing, storage, and administrative handling, are greatly reduced.
Transcription Costs:
The need for transcription dwindles as clinicians can easily enter data directly into the EHR system.
Staff Time and Efficiency:
Automating regular tasks and streamlining workflows curtails the time spent on administrative duties and lowers labor costs.
Medical Errors and Duplicate Testing:
Improved data management and access to patient records reduce errors and the need for duplication of tests.
How much does EHR cost per year?
The EHR cost per user ranges from $900-1200 annually, but pricing models vary.
Are there different pricing models for EHR systems?
Yes, there is a subscription model; other models are per-user and per-feature.
What are the components that contribute to EHR costs?
Besides the software, training, support, hardware, customization, etc, contribute to the overall cost.
Do EHR costs vary based on the size of the healthcare facility?
Depending on the size of the facility and features, the cost of EHR software varies from case to case.
What is the EHR cost for small practices?
Small practices with general features spend from $40,000 to $100,000 annually on EHR.
How much does it cost to implement an EHR system?
EHR implementation services can range from $50,000 for smaller setups to millions for complex hospital systems.
What is the cost of EMR implementation in a hospital?
The cost of EHR implementation can go up to Millions for a large hospital (variable based on size and complexity)
How much does EHR maintenance cost?
Maintenance costs are also significant, estimated at $1200 – $1500 per physician per month.
What is the cost of electronic health records software implementation?
The cost of electronic medical records software is variable based on features, software, and other aspects.
How long does it take to implement an EHR system?
Implementing EHR has several factors, like integration with other systems or migration from legacy software, which can take anywhere between 3-12 months.
How can we reduce the cost of EHR?
Controlling EHR cost through negotiation, open-source options, and optimizing usage as needed.
Why does EHR cost so much?
The high price reflects the complex development, security needs, regulations, and ongoing updates required for these crucial systems.
About the Author
Afnan Ali
Afnan Ali is a digital marketing professional with over 5 years of experience. Afnan's expertise lies in crafting comprehensive digital marketing strategies, with a strong foundation in SEO (Search Engine Optimization) as the core. His experience spans various digital marketing channels, including PPC (Pay-Per-Click) advertising, email marketing, Account-Based Marketing (ABM), and social media marketing (SMM). This well-rounded skillset allows Afnan to develop and execute data-driven campaigns that achieve measurable results.
