Complex Reimbursement Real Driver in EHR Adoption

A recent Information Week article on EHR adoption had the following quote:

“I think the number one driver [of ambulatory EHR adoption] is the change in reimbursement, the fact that it is becoming so complicated to document the process of care to get paid by the government as well as commercial payers,” said Nancy Fabozzi, a senior industry analyst at Frost & Sullivan and the report’s author. “Everybody thinks that fee-for-service is doomed and we have to have a new system of reimbursing physicians for the quality of care instead of the quantity of care because costs are exploding.”

In an interview with InformationWeek, Fabozzi said another reason for the adoption of ambulatory EHRs is that many providers have practice management systems that are old and need to be updated as they move to ICD-10 and HIPAA 5010 requirements.

It won’t be news to most of you that it’s not government incentive that is driving adoption of EHR software. The market forces are much stronger than any sort of stimulus. Although, the retarding forces of an unknown stimulus are starting to wear off and we should see EHR adoption pick up again soon.

About the author

John Lynn

John Lynn

John Lynn is the Founder of the, a network of leading Healthcare IT resources. The flagship blog, Healthcare IT Today, contains over 13,000 articles with over half of the articles written by John. These EMR and Healthcare IT related articles have been viewed over 20 million times.

John manages Healthcare IT Central, the leading career Health IT job board. He also organizes the first of its kind conference and community focused on healthcare marketing, Healthcare and IT Marketing Conference, and a healthcare IT conference,, focused on practical healthcare IT innovation. John is an advisor to multiple healthcare IT companies. John is highly involved in social media, and in addition to his blogs can be found on Twitter: @techguy.


  • My reaction to the study was surprise that Frost & Sullivan project a doubling of Ambulatory EHR revenue from $1.3bil in 2009 to $2.6bil in 2012 then peaking at $3.0bil in 2013 before returning to $1.4bil in 2016 following full saturation.

    If those numbers are in line with other projections for the Ambulatory EHR submarket … I wonder how much of the $18bil is targeted to the PCP market to incentivize acquisition by the providers … when the overall revenue projection appears that they could far easier have just bought the dang things for everybody with their ARRA budget.

  • I’ve been thinking about posting about that. $3 billion market where the government is planning to spend $18 billion on it. Something’s off there.

  • I had a similar reaction to the article and posted on our blog ( I agree it is the reimbursement change that is driving this, but doubt it is newer models. I think it is more simple… it is the stick of reduced fees. People have seen strategies for ending fee-for-service come and go. While the current environment may give it a better chance, I doubt organizations are jumping into the EHRs for the hope of an undeveloped potential model.

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