By Neil Versel

July 1, 2008 | Just 16 non-federal hospitals nationwide have proven to have the powerful combination of electronic clinician documentation, full clinical decision support, and full picture archiving and communication systems (PACS) for radiology —so-called Stage 6—through last April.

Still, that total is up from just 11 hospitals that qualified for Stage 6, the second-highest level of health IT adoption, at the end of 2007, according to HIMSS Analytics, the number-crunching subsidiary of the Chicago-based Healthcare Informatics and Management Systems Society (HIMSS). (For the first time, HIMSS Analytics excluded the relatively new technology of digital mammography from the PACS designation in Stage 6.)

The number is expected to rise, as about 50 hospitals, or 1 percent of all non-federal acute care facilities, reported themselves as being at Stage 6. HIMSS Analytics relies on self-reporting, but evaluates any hospital that claims to be at Stage 6 or higher. Only 0.8 percent of hospitals claimed to have this level of functionality at the end of 2007.

Not a single non-federal hospital has reached the highest level, Stage 7, with a fully electronic medical record as the legal medical record for all departments, an EMR capable of exporting patient records in the Continuity of Care Document format, and a data warehousing and mining operation, HIMSS Analytics reports.

The largest segment of hospitals, 35.3 percent, put themselves at Stage 2, which means they have a clinical data repository of some kind, controlled medical vocabulary, a clinical decision support “inference engine,” and possibly document imaging, not a full EMR.

“One-third of the hospitals in the United States aren’t at the foundation level for electronic health records, which is going to make it difficult for the majority of Americans to have an electronic health record by 2014,” laments HIMSS Analytics president and chief executive David Garets, referring to the Bush administration’s goal set in 2004.

Another 28.4 percent of hospitals have reached Stage 3, with some form of electronic clinical documentation, decision support in the form of online error checking, and a PACS available outside radiology.

Garets briefed reporters Monday on the organization’s latest findings. The survey, based on the Dorenfest & Associates database that HIMSS purchased in 2004, covers 5,084 hospitals—essentially every non-federal hospital in the United States—plus thousands more ambulatory clinics, sub-acute facilities, and home-health operations. The comprehensive study tracks usage of 109 different categories of health IT applications.

Garets also says hospitals are going to be caring a lot about revenue-cycle management in the near future. “There’s going to be a lot of focus on that in the next two to three years, and it’s going to take money away from the clinical side,” he says.

U.S. hospitals collectively will spend between $29.4 billion and $33 billion this year on health IT, according to HIMSS Analytics, with about 30 percent of the total coming from capital budgets rather than operating funds. That is about 10 percent above actual health IT spending for last year, which turned out to be lower than a 2007 forecast.

Hospitals are devoting about 3 percent of their operating budgets to IT now, with academic medical centers and integrated delivery systems at the higher end of the spectrum. Garets says the ratio should average 3.86 percent between now and 2013, though it should remain flat through 2010 as the economy recovers from the current state of uncertainty, then accelerate starting in 2011.

Other factors cited for the expected near-term slowdown include a possible decline in Medicare reimbursements, reduced access to capital due to a tightening in the bond market, and soaring energy costs that threaten to drive up the price of plastic-based medical supplies.