VA said to save $3 billion by using health IT

Agency spent $4 billion on health IT and saved $7 billion

The Veterans Affairs Department saved a net $3 billion over the last decade by using health information technology to eliminate duplicate tests, and reduce medical errors and operating costs, according to a new study published in Health Affairs.

From 1997 to 2007, the VA spent $4 billion on health IT systems. During that time, the savings achieved as a result of health IT systems totaled $7 billion, for a net savings of $3 billion, said the study published April 7.

Approximately $2.6 billion of the savings was achieved through reductions in duplicate testing and medical errors, the study said. The remainder was saved through reductions in workload and operating costs.

Although the VA was saving money, the department also was producing improvements in quality, safety and patient satisfaction, the study states. The health IT used by the VA examined in the study includes computerized patient records, bar-coded medications, radiological imaging, and laboratory and medication ordering.

For example, the study looked at the success in meeting clinical guidelines through the use of electronic health records and computerized physician alerts in managing diabetes, which affects about 25 percent of the VA patients.

Overall, VA patients with diabetes had better glucose testing compliance and control, more controlled cholesterol, and more timely retinal exams compared to a private-sector benchmark. For diabetes-related retinal damage, the VA scored about 15 percentage points higher than the private sector on preventive care.

"VA has seen its investment in health information technology pay off for veterans and taxpayers for many years, and this study provides positive evidence for this correlation," Veterans Affairs Secretary Eric Shinseki said. "The benefits have exceeded costs, proving that the implementation of secure, efficient systems of electronic records is a good idea for all our citizens."

The study's authors are associated with the Center for Information Technology Leadership, a research organization in Charlestown, Mass.

About the Author

Alice Lipowicz is a staff writer covering government 2.0, homeland security and other IT policies for Federal Computer Week.

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