Skip to main content

Advanced Search

Advanced Search

Current Filters

Filter your query

Publication Types





Speeding Up the Digitization of American Health Care


No more of those infuriating forms to fill out at doctors’ offices: the information is all in the computer. Doctors and hospitals don’t repeat tests you’ve had someplace else: they’re all in the computer. All your caretakers know exactly what medicines you’re on and what you’re allergic to: that’s in the computer. When your elderly mother moves from a hospital to a rehabilitation center, the nurses and doctors there know all about her before she arrives: all in the computer.

These and many other feats of information management will soon be routine in the United States. Indeed, in some places they are already happening. Our health system is undergoing a digital revolution that will profoundly affect the health care of Americans. The proportion of American hospitals with an electronic health record has grown eight-fold in recent years, from 9% in 2008 to 76% in 2014. For physicians, the comparable increase has been from 17% to 51%.

While the spread of electronic records has been dramatic, they are only a means toward a far more important end: the digitization of Americans’ health care data. That data can fuel a growing, competitive marketplace of sophisticated applications to improve providers’ and patients’ medical decisions. And digitized data can support breakthrough research that was never possible when patients’ information was scribbled on paper charts stacked in the back rooms of offices and hospitals.

A U.S. government program called HITECH has helped accelerate the electronic health care revolution. The program uses subsidies and penalties to encourage doctors and hospitals to adopt and meaningfully use electronic health records that are certified by the federal government as meeting certain standards intended to support efficient, high quality care. The HITECH plan was to start with the adoption of electronic records as they existed, and then over time, push developers and providers to design and use digital data in more sophisticated ways: to exchange them among providers and with their patients, and to extend them with software to help make better clinical decisions. The plan, in effect, was to get providers on an escalator toward ever more powerful and valuable uses of electronic records and digitized data, and to encourage developers to use open, industry-led data standards such as APIs to support them.

The plan, like any dramatic change, has faced challenges that have raised questions about its direction and pace. These problems need to be resolved if progress is to continue. But they also need to be kept in perspective.

A first challenge is that is actually quite difficult to share information between electronic records systems, so the promise of having data follow patients has so far proved elusive. Also, some electronic health records are complex and difficult to use. This is frustrating for doctors and nurses, slows them down, and can even cause safety issues. Still a third problem is that comparatively few records have added on the software — so called decision support — that could help process digitized health data and make it useful for providers and patients.

Many providers and policy-makers tend to see these issues as technical failings of the electronic records that have been recently been adopted with federal support. This has caused some critics to say that the federal investment — estimated at $31 billion over 10 years — is not paying off.

But this diagnosis is only partly correct. Underlying the challenges facing the digital health revolution are economic and social issues that must be addressed if the potential value of electronic records is to be realized.

Our predominantly fee-for-service health care payment system does not reward providers for improving quality and reducing cost. Thus, investing in costly and complicated information systems imposes expenses on doctors and hospitals that they cannot recoup through the normal forces of competition. If health care markets functioned well in the U.S, HITECH would have been unnecessary. The industry would have wired itself like our financial, travel, and retail sectors.

The problem goes beyond lack of reward. When it comes to sharing information, some health care providers and the vendors of electronic records face strong disincentives.

Patients tend to be loyal to doctors and hospitals at least in part because that’s where they’re known — that’s where their records reside. If that information can travel to another hospital or doctor at the push of a button, patients can more easily leave current providers behind. That’s not good for business.

And as for vendors, if you can move information from one vendor system to another, providers can switch out or build upon records more easily in search of a better product. That’s lost revenue for the company.

There are some important technical obstacles to moving up the escalator of the digital health revolution. Some of those, such as the adoption of API standards to enable patients to connect their data with an app of their choice, are making progress, partly in response to pressure from consumers and policy-makers who are outraged that information cannot be shared.

But technical fixes and better records won’t be enough. We need incentives that reward quality and safety improvement and cost reduction. And we need penalties for providers and vendors that slow-walk the digital revolution to protect their economic interests. If we make the market for good health care work, a lot of our current technical problems will melt away as providers and vendors compete to make service and care better for their customers: the nation’s patients.

Publication Details



David Blumenthal, Former President, The Commonwealth Fund

[email protected]


David Blumenthal and Aneesh Chopra, “Speeding Up the Digitization of American Health Care,” Harvard Business Review, published online Feb. 22, 2016.