No matter where you stand on healthcare reform, one thing is certain: change is coming. It's time for the industry to prepare. That means changing attitudes and adopting new processes to improve care and efficiency. Enter the electronic medical record (EMR): the future of healthcare.

Few topics generate as much debate today as healthcare reform. Despite months of deliberation in Washington, there is still little indication of what form new legislation might take. However, one point of consensus has emerged: the current system is unsustainable. Significant change is coming, particularly in how healthcare is financed and delivered.

What does this mean for the healthcare industry? Along with change come new challenges, opportunities and risks. The key to adapting is preparation -- shifting mindsets and strategies to improve care, access and efficiency.  The centerpiece of this process will doubtlessly be new technology, particularly deployment of the EMR.

EMR: a healthcare must-have

The EMR is a tool that promises to pull together disparate healthcare information into a broad, critical mass of information, both in the in-patient setting, and the ambulatory. The goal of EMR is to move healthcare to focus on outcomes and create the 'evidence based medicine' approach to providing healthcare. This move will impact overall cost in the long run. It generates an electronic record that is consistent and complete, following a patient through the full cycle of care: from the physician's office to the specialist's office, then to the hospital and back to the physician.

Between now and 2017, there could be major incentives to execute the EMR in terms of Medicare reimbursements and payments to physicians, providers, hospitals, and nursing homes. Paper based providers, on the other hand, will see slower and lower reimbursements. The challenge with this incentive occurs with doctors, most of whom are independent of the hospital and therefore not officially paid by them.

The implications of the EMR are enormous, as is the technology behind it. It touches every component of the healthcare delivery spectrum -- all the way from physician to nurse, even to the person transporting an individual inside a hospital. Every process, be it clinical or business, links back to the EMR. While that process should be streamlined and faster, building and implementing it takes time.

Re-inventing the business of healthcare

The use of the EMR means a complete shift to electronic information. And because you're eliminating paper, all of the processes will change, which affects every person who touches the document. Such a shift has an enormous impact on back-office administrative costs, workflow, the number and types of staff required, and the kinds of skills they need. Consider a typical week-long hospital stay, which generates about 10,000 pieces of paper and even more opportunities for error. When you convert that to electronics, it is much easier to get accurate information to the right individuals. With the workflow analysis that goes into the EMR, you're changing process, which is why people, process and technology must be well-integrated.

Such a major change does breed complexity. Many health systems use hundreds of applications that may be departmentally focused, so the level of effort and the complexity of integrating all of the relative technologies and points of contact for a patient become very complicated. From a people perspective, consider a typical hospital of 500-800 beds, where as many as 5,000 people are employed. Because they are all involved directly or indirectly with patient care, every one of them would be affected. Complete training and implementation might take up to three years, depending on the hospital's level of sophistication and how aggressively they pursue the EMR. 

As for cost, complete implementation and integration and process redesign and re-engineering could range anywhere from 25 to 50 million dollars -- no small investment. That means planning, strategy, implementation, process redesign, and re-engineering become critical components.

Going completely electronic also makes issues like privacy, security, confidentiality critical. There are familiar rules around these topics, such as the Health Insurance Portability and Accountability Act (HIPAA) and the HIPAA guidelines. There are many more, and they are becoming more important. For example, unlike having a diagnostic procedure at a hospital or ambulatory center, more sensitive types of medical care like psychological care, or HIV treatment go through extra levels of security and privacy regulations.

Shifting to evidence-based medicine

Through the EMR, there are standard protocols attached to different procedures or methods of care. In the case of the removal of a gall bladder, for instance, information is carried about the patient in terms of whether there are allergies, post-operative infections, the extent of recovery, any complications, and so on. That kind information is part of the incentive program that health institutions and physicians will be working with in the future.

Evidence-based or outcomes-based medicine are derived around a common set of data elements, which makes data warehousing and business intelligence crucial component pieces of the EMR. Data quality will also become critical – it's a good way to determine if a new protocol is safe and to compare its cost to other protocols.

No matter what shape healthcare reform eventually takes, every hospital, physician, provider, insurance company and the government must be prepared for change. They must become laser-focused on the quality, accuracy and integrity of patient data. Whether you view the EMR as an opportunity or a challenge, it is clearly emerging as the most powerful tool for bringing the business of healthcare into the future.  

Mike Gorsage is a Partner and Leader of the Business Operations and Technology Practice for Tatum LLC. Tatum is the nation's largest executive services firm, providing financial and technology leadership nationwide.