By Reed Cooley, CQ Staff
The threat of financial penalties rather than the promise of incentives -- or more simply, the stick, not the carrot -- will spur providers to adopt health information technologies on the widest scale, Congressional Budget Office Director Peter R. Orszag told Congress on Thursday.
"If you want to get to near universal health IT in the near future, meaning the next five years, it's got to be the stick," Orszag said at a Senate Finance Committee hearing to examine possible improvements to quality in the U.S. health care system.
While providing incentives to adopt health IT would push those already considering it over the line, Orszag said the fastest way to garner wider participation would be to deny payments to those opting for non-adoption, particularly from the country's largest payer: Medicare.
Committee member Pat Roberts, R-Kan., who prompted Orszag's declaration when he asked what Congress could do to support the implementation of electronic medical records and other health IT functions, listened quietly when Orszag discussed the option of providing subsidies for adoption. But he balked when the CBO director mentioned withholding Medicare reimbursement.
"We are really on the edge right now," Roberts said, implying that any obstacles to reimbursement under Medicare could prompt providers to refuse care to beneficiaries.
He added that Congress "saved an awful lot of people with regards to Medicare services," referring to legislation that reverses a scheduled 10.6 percent cut to Medicare's physician payment rates.
Orszag said it was possible that some providers would simply drop Medicare services instead of adopting health IT. But he said that most physicians would prefer to lay down a $30,000 investment in electronic medical records rather than lose all business from Medicare beneficiaries. The "stick" plan could also include Medicaid and the State Children's Health Insurance Program, depending on how aggressive Congress wants to be, he said.
While few committee members voiced their opposition to Orszag's proposal as vehemently as Roberts, none seemed to embrace it wholeheartedly. Committee Chairman Max Baucus, D-Mont., pressed witnesses to discuss the drawbacks of health IT.
George C. Halvorson, chairman and CEO of Kaiser Permanente, insisted that returns on investment have been "extremely good" for Kaiser providers that had fully implemented health IT. "I don't see a downside to it. I think it's the future of health care," he said.
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