These are actually two related yet independent questions – both important, but each from different perspectives. Since the answer is totally dependent on the unique situation of each practice there is no single, simple answer. Some of the most important factors driving the raw costs of transitioning to EHR include the number of practicing therapists, patient volume, and hardware/network infrastructure that either is nor is not already in place.

How much will it cost to transition from paper to electronic documentation? The best way to think of this question is from a ‘total cost of ownership’ perspective. TCO costs include hardware (such as PC’s and a wireless network), software, training and implementation services, and integration of your various systems (usually scheduling, documentation, and billing), and annual renewal fees for support, licensing and upgrades.  It is also wise to consider the disruption of your productivity caused by work flow changes and training that takes place during the transition. While it’s tempting to simply ask vendors for proposals and compare the prices they provide, you should always request that your vendors represent total cost of ownership over several years that includes cost elements that do not come from them – that is the best way to understand the total costs on an ‘apples to apples’ basis.

Does it make financial sense to transition from paper to electronic documentation? This question drives at the overall financial impact of the transition. In addition to the total cost of ownership, you should seek to understand:

• How will revenues be impacted? Some of the strongest financial benefits come from proper, as opposed to under billing. When all patient care is properly documented, and the billing information is a bi-product of the documentation process, then all services provided are billed appropriately. This single factor - recovering lost charges for services currently being delivered - often pays for the total cost of ownership within a short period of time.
• How are costs impacted? Paper charting supplies are no longer needed. Document storage, faxing and courier costs often decline. Transcription fees can be eliminated. Cost reduction usually does not depend on staff reduction, but dramatic changes in work flow (such as the electronic management of claims data, instead of human entry) can result in reallocating staff to increase capacity or to spend more time and attention focused on patient care.
• ‘Soft’ benefits. Several of the significant financial benefits don’t lend themselves well to quantification. For example, what is the impact of having clear, legible, comprehensive and complete documents to share with your referring physicians? Does it secure existing relationships and aide in marketing to new sources of referrals? What is the value of lowering your risk profile during audits by having those same documents – with a very high degree of confidence that the documentation mirrors the claim – that are 100% accessible and just mouse clicks away?