Upfront Costs Of Going Digital Overwhelm Some Doctors

Dr. Oliver Korshin practices ophthalmology three days a week in the same small office in east Anchorage, Alaska, he's had for three decades. Many of his patients have aged into their Medicare years right along with him.

For his tiny practice, which employs just one part-time nurse, putting all his patients' medical records in an online database just doesn't make sense, Korshin says. It would cost too much to install and maintain — especially considering that he expects to retire in just a few years.

"No possible business model would endorse that kind of implementation in a practice situated like mine," he says. "It's crazy."

But starting next year the federal government will penalize Korshin and other doctors for not using electronic health records; Medicare will withhold 1 percent of his payments. What's more, Korshin will lose an additional 1.5 percent for failing to enroll in a federal program that requires doctors to digitally keep track of (and report) quality data about how their patients fare under their care.

And then there's the new coding system, also set to take effect in the the fall of 2015 — an overhaul of the standard method of classifying diseases and conditions. Medicare and other insurers require the proper use of these codes if doctors want to get paid for the treatments and procedures they perform. A cost study sponsored by the American Medical Association earlier this year estimated that depending on "variable factors such as specialty, vendor and software," implementing the new coding system alone could cost a small medical practice between $56,639 and $226,105.

All these technological initiatives are designed to improve medicine — to bring it into the digital age. But Korshin and many other doctors with small practices say they feel overwhelmed and can't keep up.

"This flurry of things one has to comply with means that unless you work for a large organization, like a hospital, that can devote staff and time to dealing with these issues, there's no economy of scale," Korshin laments. "I can't share these expenses with anybody."

Korshin may seem like an outlier — close to retirement with a very small practice. But he has lots of company, says Mike Haugen of the Alaska State Medical Association.

"Most practices in Alaska are small practices," Haugen says. "They're one-, two- and three-doctor practices. The number of really large practices — and that's relative in Alaska — you can probably count them on one hand."

Haugen says he hears a lot of complaints from doctors, and worries the burden is forcing many — especially older physicians — to consider retiring early.

"There won't be some flashing neon sign we ever see that says X number of doctors have left," he says. "It's a very quiet process. And that, for me, is the scary part. Because you take a look at the medical association membership a year or two from now, and it may be smaller. And access to care in this state is a real issue."

Rebecca Madison thinks a lot of doctors would decide to stay in practice if they had help with the transition to electronic health records. That's Madison's job as executive director of Alaska eHealth Network — she wants to make it as easy as possible for providers to make the switch.

She tries to sell doctors on the benefits. She reminds them electronic records can make their offices more efficient and give them better data on the care they're providing. The systems can also lower billing costs, she explains.

"We work with providers to ensure that they have the best experience they can, going into an electronic health record," she says, "because it really is changing your entire practice. It's not easy."

This story is part of a reporting partnership that includes NPR, Alaska Public Media and Kaiser Health News