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Digital Medical Record Initiative Aims to Cut Health Care Costs

November 30, 2006
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The digital health records Intel plans to create with the help of other large employers are expected to save companies as much as 6.7 percent in total health care costs, a nearly fourfold savings increase over current systems, says a consultant who has worked with Intel on the project.

Intel, along with Wal-Mart, British Petroleum and several other employers, is scheduled to announce on Wednesday, December 6, a plan to provide employees with digital health records and create a data warehouse that can be used to store them, according to Brian Golden, a consultant with Mercer Health and Benefits. The records will differ from current models because they will exist independent of any particular health insurance company or medical provider, according to people familiar with Intel’s plan.

While other efforts are under way to create digital health records, the coalition is yet another sign that employers do not have the patience to wait for the health care industry to bring itself into the 21st century while health costs increase every year.

"They obviously don’t want to sit around and wait to make it happen," says Laurel Pickering, executive director of the New York Business Group on Health.

Representatives of Wal-Mart and Intel declined to comment.

Most health experts agree that electronic health records would improve medical quality by flagging redundant treatments and making it easier to read prescriptions and doctor’s order forms. The records also would provide detailed information about past courses of treatment, lab and radiology tests, and other aspects of an individual’s medical history that can be used to diagnose and treat new illnesses. As many as 98,000 people die each year from medical errors that could be avoided with the help of digital prescriptions and medical record keeping.

Intel has been working on the project, called P3HR, for some time. When the public announcement is made Wednesday, Intel plans to rename it Dossia, a source says. The company has registered a Web site, Dossia.org, under the name of Omid Moghadam, the director of Intel’s personal health record program.

Though its efforts to develop a system that is widely adopted may eventually pay dividends, it is touting the project as a public service. That is partly why the collaboration will take the form of a nonprofit organization whose members make a $1.5 million contribution.

While most current health records are populated by an insurance company’s claims data, Intel’s health records will contain more useful information that could result in significant cost savings, Golden says. Eventually the personal health records will tell consumers when a generic drug is available; whether a better and more cost-efficient doctor is available; and whether the dosage of a medicine is too high.

The initial phase will last from 2007 to 2009, at which point the project will be running on its own, Golden says.

"What Intel is trying to do is build a public consortium of data that would be utilized as a personal health record," Golden says.

The fee to join the association will drop as more employers get on board, until the price tag to offer employees digital health records becomes nominal, Golden says. In this sense, the collaborative will resemble another employer coalition, Care Focused Purchasing. That effort, led by Boeing and Lowe’s, is focused on gathering data on doctors to rate their performance.

The individual consumer will be at the center of a network that connects patients to doctors, pharmacies and hospitals. The employers involved in the collaborative hope that by acting together they can use their massive employee base as an incentive to compel medical providers to adopt compatible technology. Some details of the plan were first reported November 29 in The Wall Street Journal.

The personal health record, or PHR, differs sharply from the electronic health record, which is simply a record of a health service in digital form. These records exist at hospitals, doctor’s offices, pharmacies and health insurers. The personal health record is a digital file owned by individuals containing their health information from various medical providers.

"What is required to make the personal health record work is a network, and this consortium might be trying to do that," says David Lansky, senior director of health programs for the Markle Foundation. "The PHR would be the place where information is pulled together and made available to other parties to the extent the user wishes."

Questions remain regarding who will own these records, who will be responsible for paying to maintain them in digital warehouses, what they will look like and how to ensure the records can be read by the hundreds of different medical computer software currently on the market. Privacy advocates also worry about the vulnerability records may have to hackers.

"I’m not sure what the ownership model is, but that will be a critical thing to watch," says Kenneth Mandl, co-director of the Center of Excellence in Public Health Informatics at Harvard University.

Despite the challenges, Lansky says personal health records in general have the potential to transform the health care system.

"This is a dramatic idea. So far we’ve relied on doctors, hospitals and pharmacies. The big idea is that instead of relying on those institutions to move information around, the patient is the manager of his information."

--Jeremy Smerd

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