Leveraging Electronic Health Records to Improve Hospital Performance: The Role of Management

The U.S. is in the midst of an ambitious effort to achieve nationwide adoption of electronic health records (EHRs) to drive improvements in the quality and efficiency of care.  However, recent studies fail to find a consistent relationship between EHR adoption and improved hospital performance, suggesting that EHRs may be insufficient, unto themselves, to drive improvements in care delivery.  In this paper, we leverage a unique data set on hospital management practices collected through interviews with managers in a nationally-representative random sample of acute-care hospitals, along with data from the American Hospital Association's IT Supplement in order to explore whether management quality modifies the relationship between EHR adoption and cost and quality outcomes for acute myocardial infarction (AMI).  Specifically, we examine the following risk-adjusted outcomes - payment per discharge, 30-day mortality, and length-of-stay - calculated from Medicare data for fee-for-service beneficiaries 65 years of age or older who were hospitalized for AMI.  For all three outcomes, the modified effect was in the predicted direction, and two of the three were statistically significant.  We did not find evidence of effect modification for mortality (coefficient on interaction between EHR and management= -0.05; p=0.37). For length-of-stay, the coefficient on the interaction between EHR and management was -1.48 (p=0.05) and for payment, the coefficient on the interaction term was -7,786.74 (p=0.014). Thus, in summary, in our national sample of hospitals, we find that when hospitals are well managed, having an EHR is associated with greater efficiency, whereas in poorly-managed hospitals, EHRs are associated with worse efficiency. Our findings suggest that EHR implementation needs to be coupled with effective management to drive value from these systems.