What's the catch? With tech freebies, maybe there isn't one

Physicians might be skeptical of health plans offering them free or discounted software. But the plans -- and some doctors themselves -- say accepting their offers isn't such a bad idea after all.

By Tyler Chin — Posted Dec. 12, 2005

Print  |   Email  |   Respond  |   Reprints  |   Like Facebook  |   Share Twitter  |   Tweet Linkedin

It's a long-held truism that you should be cautious of your enemy bearing gifts. Given the contentious relations between many physicians and health plans, physicians would be excused in wondering why health plans are offering, sometimes at no cost to doctors, technology such as electronic prescribing, payer-based electronic records and electronic medical records systems.

So far, it appears that health plans are coming in peace. Of course, they're offering free or discounted technology to physicians because the plans figure it will save them money. But in many cases, all they're asking in return is that the physicians use the technology they're given.

For example, when Highmark and Independence Blue Cross last September separately announced programs under which they will offer e-prescribing technology to doctors in Pennsylvania, the state's medical society saw them, in this case, as more friend than foe.

"We're glad to see that they are taking an active part in order to help their networks come up to speed [with electronic records]," said Peter Achor, a spokesman for the Pennsylvania Medical Society, which in May co-founded an initiative to encourage physician adoption of electronic records. "This technology is critical for patient safety and for improving work processes and helping doctors treat their patients better," Achor said.

For many years, technology consultants have said that for information technology to take hold in practices, a large outside organization -- such as a health plan -- would have to kick in money toward the systems.

That's what's starting to happen. From New Jersey to Florida, Michigan to Tennessee, Nevada to Pennsylvania, plans are shelling out for technology, mostly aimed at high-prescribing primary care physicians.

Glen Tullman, CEO of Chicago-based Allscripts, told Wall Street analysts during a recent conference call that "there is substantial and growing interest from the payers and ... we'll be announcing more payer deals that are in the pipeline. They are seeing that this is the only way to try to manage these costs."

Tullman should know. Since April, Allscripts has announced e-prescribing technology deals with Horizon Blue Cross Blue Shield of New Jersey, Independence Blue Cross in Pennsylvania and Las Vegas-based Sierra Health Services.

Sierra is funding the cost of licensing Allscripts' software for 10 years for all 5,000 physicians in Nevada.

A small number of insurers have offered free e-prescribing technology to physicians for years. But the volume of the offers has not only accelerated this year but also expanded to include payer-based electronic records derived from claims.

A few plans also are offering to give away or subsidize EMRs, but their number is limited because of the expense, said Pat Kennedy, a health care technology consultant in Rockville, Md.

Still, the rate of plans offering technology is expected to go only up, particularly because health plans' corporate payers are demanding they find ways for more doctors to adopt technology.

"There's lots of things payers can do to further reduce costs, but a lot of it depends on them getting good information electronically [from and to physicians and hospitals]," said John Quinn, senior executive at Accenture, a New York consulting firm. "There are many payers looking at this who are saying, 'There's enough downstream savings for us if we can get the physicians to change their behavior and start using computers that we're willing to make an investment to see if we can make them do it.' "

There is one catch

Observers -- and insurers themselves -- say that the giveaways aren't completely devoid of cost to physicians, who must enter data themselves and pay ongoing maintenance costs after a certain period.

"The quid pro quo is you have to agree to use the technology and that it's usually given to you for the first year for free. After that you have to pay the subscription cost," said AMA Board Secretary Joseph M. Heyman, MD, who has pledged to participate in a health network initiative funded by BlueCross BlueShield of Massachusetts.

Highmark isn't giving away technology, because it believes "that if physicians have to invest some of the dollars themselves, they must be motivated to not only get it but will also use it," said Donald R. Fischer, MD, Highmark's chief medical officer and senior vice president.

On Nov. 15, Highmark announced it had contributed $26.5 million to the Pittsburgh Foundation, including $18.5 million specifically to subsidize physician purchases of e-prescribing or EMR systems. The remainder will be used to support implementation of e-prescribing at the University of Pittsburgh Medical Center.

The Pittsburgh Foundation will award grants to 4,000 to 6,000 in-network Highmark physicians who apply for the money. The grants will pay up to 75% of the cost for a physician's office to acquire, install and implement an Internet-based system, up to a maximum of $7,000 per physician, Dr, Fischer said.

Although Highmark's initiative will pay for EMRs, it is largely geared toward e-prescribing. That's because Highmark anticipates that most physicians will prefer an e-prescribing system because it's less complex and won't drastically alter how they practice as much as an EMR would, Dr. Fischer said.

"We want to facilitate the adoption of [EMRs] in general because we believe that will be the agent that will allow a significant improvement in quality of care and patient safety," he said. "We know that both of those things ultimately are tied to cost efficiency, and in order to get people started in the electronic world, we believe that e-prescribing is a first step [toward that]."

Rather than give the money or technology directly to physicians, Highmark is seeking to achieve its goals through a third party to allay any concern doctors might have that it had an ulterior motive for making its offer other than partnering with them to improve care, Dr. Fischer said.

A third party

Highmark is not the only plan to recognize that offering its technology through a foundation, or some other indirect arm of the health plan, might help physicians feel more comfortable with the offer.

Earlier this year, BlueCross BlueShield of Massachusetts donated $50 million to a nonprofit -- the Massachusetts eHealth Collaborative -- to make it easier for the Blues plan to get physician and hospital buy-in for a health networking initiative linking all hospitals and private practice physicians in three communities: Brockton, Newburyport and North Adams.

Doctors initially were concerned that the Blues would access and use their data against them, said Micky Tripathi, CEO of the collaborative. But they now understand that the collaborative isn't a Blue Cross company, he said. Also, the contract sent to doctors states that the collaborative will not share any of their data with insurers and that the data will be used only for the evaluation run by the collaborative, Tripathi said. The contract also states that their data will be destroyed when the pilot ends.

Under the initiative, the nonprofit will buy EMRs for physician offices. It also will pay for hardware, training and support costs for three years ending June 2008 if physicians agree to participate in the pilot, which among other things will evaluate whether technology improves care and reduces medication errors, Tripathi said.

The collaborative also will pay the cost of integrating a doctor's practice management system with the EMR he or she chooses, presuming the doctor's billing system is from a major vendor. If it isn't, the collaborative will buy an integrated EMR and practice management system if that's what the doctor wants, Tripathi said.

During the summer, 96% of the 450 physicians in the three communities signed nonbinding letters of intent, including the AMA's Dr. Heyman, an OB-GYN who practices in the Newburyport area. At press time, the collaborative began asking doctors to sign contracts committing themselves to the project, Tripathi said.

Another catch

But physicians in the Massachusetts project still have to give something back. As part of their contract with the collaborative, physicians must agree to use the technology, participate in its evaluation and enter structured data in certain data fields, Tripathi said.

If they comply with those terms, they will get the technology for free after June 2008. At that point, they will have to pay maintenance fees or a monthly subscription fee depending on whether they selected a client/server or Internet-based system, Tripathi said.

"We're hopeful that by then they will get so used to using the EMR" that they will pay to continue using the system.

Before physicians accept technology freebies from insurers, they should have a clear understanding of what insurers expect from them in return, Dr. Heyman said.

"If it's something that they feel they can live with and that doesn't hurt patients or interfere with the doctor-patient relationship, then I think it's fine [to accept it]," he said. "But if they feel it's something that is going to interfere with that relationship, invade the patients' privacy or somehow hurt them financially, then they shouldn't take it."

Back to top


Tech goodies

Since 2003, several health plans have offered physicians deals on electronic prescribing software, hardware and other technologies. Those offers have included:

Tufts Health Plan, BlueCross BlueShield of Massachusetts (October 2003): $3 million initiative to give electronic prescribing systems to 3,400 high-prescribers in their networks.

WellPoint (January 2004): $42 million program to give 19,000 doctors in California, Georgia, Missouri and Wisconsin their choice of a handheld-based e-prescribing system or a desktop-based practice management system.

CareFirst BlueCross BlueShield (August 2004): Offer of handheld devices and electronic prescribing software to 500 high-prescribers.

BlueCross BlueShield of Massachusetts (October 2004): $50 million donation for hardware, electronic medical records software and support fees for doctors, clinics and hospitals that agree to participate in a three-year health networking initiative.

The Health Alliance Plan, BlueCross BlueShield of Michigan and the Big Three automakers (February 2005): Multimillion-dollar effort to give e-prescribing technology to 17,000 Michigan physicians.

Horizon Blue Cross Blue Shield of New Jersey (April 2005): $3 million program to give handhelds and e-prescribing software to 700 high-prescribers. The offer includes training and support costs.

BlueCross BlueShield of Tennessee (May 2005): Multimillion-dollar initiative to make electronic records of its members available to physicians.

Horizon Blue Cross Blue Shield of New Jersey (August 2005): Initiative to give physicians high-speed Internet access.

Humana, BlueCross BlueShield of Florida (September 2005): Joint venture to offer payer-based electronic record systems to Florida physicians in 2006.

Independence Blue Cross (September 2005): Offer of e-prescribing system to 500 physicians in southeastern Pennsylvania.

CareFirst BlueCross BlueShield (October 2005): Extension of a previous offer pays the software licensing fees for a second year for 300 doctors who averaged 50 or more electronic prescriptions monthly.

Sierra Health Services (October 2005): Announcement that it will pick up the tab of electronic prescribing software licensing fees for all 5,000 physicians in Nevada for 10 years.

Highmark (November 2005): $26.5 million investment to subsidize cost of e-prescribing and EMR systems for up to 6,000 physicians in western and central Pennsylvania.

Source: Individual plans

Back to top



Read story

Confronting bias against obese patients

Medical educators are starting to raise awareness about how weight-related stigma can impair patient-physician communication and the treatment of obesity. Read story

Read story


American Medical News is ceasing publication after 55 years of serving physicians by keeping them informed of their rapidly changing profession. Read story

Read story

Policing medical practice employees after work

Doctors can try to regulate staff actions outside the office, but they must watch what they try to stamp out and how they do it. Read story

Read story

Diabetes prevention: Set on a course for lifestyle change

The YMCA's evidence-based program is helping prediabetic patients eat right, get active and lose weight. Read story

Read story

Medicaid's muddled preventive care picture

The health system reform law promises no-cost coverage of a lengthy list of screenings and other prevention services, but some beneficiaries still might miss out. Read story

Read story

How to get tax breaks for your medical practice

Federal, state and local governments offer doctors incentives because practices are recognized as economic engines. But physicians must know how and where to find them. Read story

Read story

Advance pay ACOs: A down payment on Medicare's future

Accountable care organizations that pay doctors up-front bring practice improvements, but it's unclear yet if program actuaries will see a return on investment. Read story

Read story

Physician liability: Your team, your legal risk

When health care team members drop the ball, it's often doctors who end up in court. How can physicians improve such care and avoid risks? Read story

  • Stay informed
  • Twitter
  • Facebook
  • RSS
  • LinkedIn