Proponents of health information technology (HIT) contend that widespread adoption of electronic medical records (EMR) will both enhance patient safety, and help contain health care costs by decreasing inefficiencies in health care delivery.  Most studies seeking to determine the impact of HIT for patient safety focus on whether EMRs can prevent medication errors.

Majority of lawsuits due to diagnostic errors, not prescribing errors

It seems natural to assume that if EMRs can help prevent medication errors, they can decrease patient injuries - and with fewer injuries, malpractice claims would decrease.  Some physicians are skeptical, however.  In an opinion piece published in The Wall Street Journal earlier this year, two physicians from Harvard Medical School questioned the Obama administration's initiative to encourage adoption of EMRs as a cost-saving measure.  The authors note:

The impact of medication errors on malpractice costs is likely to be minimal, since the vast majority of lawsuits arise not from technical mistakes like incorrect prescriptions but from diagnostic errors, where the physician makes a misdiagnosis and the correct therapy is delayed or never delivered.  There is no evidence that electronic medical records lower the chances of diagnostic error.[4]

EMR and EHR systems likely to reduce claims and improve definsibility 

The authors are probably correct in observing that errors in diagnosis account for more malpractice claims than any other type of error.[5]  However, medication errors are not an insignificant contributor to malpractice claims.  A study of claims from 1990 to 1999 found that adverse drug events represented 6.3% of claims, and were preventable in 73% of the cases.[6]

Several factors (such as investment returns earned by the insurer, risks of the industry, and claims history of the insured) influence the premium rates that an insurer charges for any type of liability coverage.  The insurer's estimate of risk takes into account expected frequency (number of claims expected) and severity of claims (anticipated dollar loss associated with claims, including defense expenses, jury verdicts and settlements).  An effective risk management program is directed toward lowering insurance costs by decreasing the number of claims, and when a claim does occur, working to resolve it at the lowest possible loss.

In 2007, the Certification Commission for Healthcare Information Technology (CCHIT) published an article advocating for lower malpractice insurance premiums for physicians who implement certified electronic health record (EHR) systems.[7]  CCHIT asserted that physicians using certified EHR systems enhance the quality and safety of their care through:

• Improved aggregation, analysis and communication of patient information;
• Diagnostic and therapeutic decision support
• Prevention of adverse events (such as safeguards against prescribing drugs which interact with the patient's current medications)
• Clinical alerts and reminders; and
• Enhancing research on clinical quality improvement.

These factors could be helpful in decreasing frequency of claims.  CCHIT also states that physicians who use EHRs may improve defense of liability claims, by improving medical record documentation (including documentation of the informed consent process).  If the physician's insurer is better prepared to defend the case, because of improved documentation provided through the EHR, results of settlement negotiations and jury trials may be more favorable, thus decreasing severity of loss.

A study reported in the Archives of Internal Medicine in 2008 provides some support for the position that adoption of EHRs can decrease malpractice exposure.[8]  Researchers surveyed physicians practicing in Massachusetts about EHR adoption, and linked the survey data to physician profile data from the Massachusetts Board of Registration in Medicine.  The study found that physicians who used EHRs were less likely to have paid malpractice claims than physicians who did not use EHRs, and that within the physician group that used EHRs, physicians who were characterized as high users had lower rates of claims than physicians classified as low users.  The study authors note, however, that due to limitations of the study, results should be considered preliminary.

Malpractice insurance discounts with EHR adoption 

Some malpractice carriers are beginning to offer discounts for policyholders who have adopted EHRs.  Recent examples include:

• Policyholders of the Texas Medical Liability Trust who document use of an EHR or electronic prescribing for at least one year can quality for a 2.5% discount. The program includes specific risk management criteria. Policyholders who participate in continuing medical education on EHR implementation offered by the Texas Medical Association can also qualify for a discount.[9]
• Midwest Medical Insurance Company offers a premium credit for physician groups that have implemented a CCHIT-certified EHR and have been using it for at least a year. At least 75% of the group's providers must be using at least two of the following functionalities: medication allergy checking and current medication list; order status tracking and alerts; health maintenance alerts; managing of consents and authorizations; external document scanning; and provider approvals. The credit ranges from 2% to 5% depending on the functionalities used.[10]
• Horizon Blue Cross Blue Shield of New Jersey collaborated with several malpractice carriers in New Jersey to offer premium discounts to physicians who have implemented an approved electronic prescribing or EHR function.[11]

In addition, one insurer (Northwest Physicians Insurance Co. of Oregon) offers a discount to doctors who communicate with patients via email using a computerized personal health record.[12]

It appears that some malpractice insurers think that use of EHRs will decrease malpractice claims, and are starting to offer small discounts to physicians who adopt electronic records.  Insurers will likely evaluate their claims history as more experience is gained with EHRs to determine whether such discounts should be continued, or expanded.               

[1] Bates, et al., Effect of Computerized Physician Order Entry and a Team Intervention on Prevention of Serious Medication Errors, 280 JAMA 1311 (Oct. 21, 1998).

[2] Hillestad, et al., Can Electronic Medical Record Systems Transform Health Care?  Potential Health Benefits, Savings, and Costs, 24 Health Affairs 1103 (September/October 2005).

[3] For example, the American Academy of Orthopaedic Surgeons recommends CPOE and computerized decision support systems, among other tools, for prevention of medication errors.

[4] J. Groopman and P. Hartzband, Obama's $80 Billion Exaggeration, The Wall Street Journal, March 11, 2009.

[5] A 2004 review of claims data compiled by the Physician Insurers Association of America found that failure to diagnose was the most frequent cause of malpractice claims, followed by improper performance of a procedure.  Fitzgerald, Top Five Causes of Malpractice Claims, published online at http://www.apassurance.com/RiskMgt/Articles_RM/5%20Causes%20of%20Claims_RMArticle.pdf.

[6] Rothschild et al., Analysis of Medication-Related Malpractice Claims:  Causes, Preventability, and Costs, 163 Arch. Int. Med. 1112 (May 12, 2003).

[7] Certification Commission for Healthcare Information Technology, CCHIT Certified Electronic Health Records Reduce Malpractice Risk, 2007.

[8] Electronic Health Records and Malpractice Claims in Office Practice, 168 Arch. Int. Med. 2362 (Nov. 24, 2008).

[9] The program is described at http://www.texmed.org/Template.aspx?id=6188.

[10] Information concerning the Certified Electronic Medical Record Risk Management Premium Credit is available on the company's website, www.mmicgroup.com.

[11] Insurers participating in the program are listed at http://www.horizon-bcbsnj.com/SiteGen/Uploads/Public/horizon_bcbsnj/pdf/Medical_Malpractice_Insurance_Discounts-2009.pdf.

[12] "Malpractice insurer offers physicians a discount", Portland Business Journal, Feb. 21, 2008.

About the Author

Patricia King is a health care attorney in Illinois, and principal of the web-based business Digital Age Healthcare LLC (http://www.digitalagemd.com/).