Breaking the stalemate — a malpractice insurer steps up

MAeHC today announced our participation in a joint initiative to provide malpractice premium credits to physicians utilizing EHRs. The Connecticut Medical Insurance Company — in a program developed jointly with the Massachusetts Medical Society, Physicians Insurance Association of Massachusetts (an MMS subsidiary), and MAeHC — will offer credits ranging from 5-20% to Massachusetts physicians who use EHRs.

Malpractice insurers are among the many stakeholders in healthcare delivery who stand to benefit a great deal from widespread, effective use of EHRs and HIEs. Yet, up until now, they’ve stood on the sidelines, in part because they’ve been trying to figure out whether EHRs really will reduce risk, but also because they’ve been economic “free riders” — happy to capture the benefits of other peoples’ investments.

Malpractice insurers stand to be among the biggest winners in the move to digital health records. Some of the greatest sources of liability risk for physicians — messy documentation, inconsistent collection of family histories, poor tracking of patients — are addressable by EHRs and HIEs, as long as they’re implemented correctly and properly used.

Of course, there could be some increases in risk as we move to modern electronic systems. Breaches of confidentiality, and increased errors while physicians and medical staff become familiar with the new systems come immediately to mind. However, we can work on reducing these types of risks; for example, the CMIC program will require that physicians demonstrate long-term commitment to the EHR and to effective risk management. Implementing EHRs and HIEs within a program framework, such as MAeHC’s, dramatically increases the odds of effective implementations and significant net risk reduction. Of course, risk reduction means fewer medical errors, so patients will be the biggest beneficiaries at the end of the day.

Some physicians may not leap at this program because of an ideosyncracy in the Massachusetts malpractice insurance market. CMIC only offers “claims-made” payment terms, which are the standard in most of the country, but not in Massachusetts, one of the very few states where the “occurence” model prevails. I’m not an insurance expert but my understanding of this is that most practicing physicians in Massachusetts would benefit from moving to the “claims-made” model even without this new program — the EHR credit is just an added bonus. I hope that physician confusion over this issue doesn’t prevent them from taking advantage of a program that will offer them real value.

One of the most frustrating aspects of health IT is that the benefits seem so obvious, but they’re hard to capture because the economic incentives in our ridiculously fragmented healthcare delivery system are misaligned, diffuse, and difficult to measure. I applaud CMIC’s willingness to cut through this morass and put a real program on the table. We believe this is the first such program in the country. Hopefully others will follow……
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