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EHR, E-Prescribing and P4P Affects Your Practice–for Better or Worse

May 13, 2014

ehr p4p ep resized 600Although Medicare and Medicaid issued the first incentives for electronic health records (EHRs) and pay for performance (P4P), private payers are very interested in adopting similar programs. The luster of newness has now worn off and many medical providers are making the transition.

However, these digital solutions often create challenges and demands for more efficient IT systems and software. Not all practices have the computing power to record and share lab test results, e-prescribe or the capacity to use computerized physician order entry (CPOE).

Practice IT Infrastructure

Those medical practices that have upgraded their systems have the ability to participate cost effectively in all data sharing opportunities. Practices that have yet to install next generation systems will encounter time and cost challenges participating in some EHR, e-prescribing, lab data sharing and P4P incentives.

If their IT systems lack sufficient speed and capacity, practice staff needs to manually intervene, as they have in the past, to transmit data and documents. To maximize the incentives, more staff intervention equals more cost and potential for errors. In these situations, the lack of up-to-date hardware and software could hurt, not help, practice revenue and profitability.


While some practices have become quite comfortable with e-prescribing, there are still many that remain unfamiliar with the process. Although there are many online and print resources, including flow charts and diagrams, that display the components of every type of transaction, the process often remains a mystery to some physicians and practice staff.

Understanding the process and benefits of e-prescribing is important to using EHR and P4P to maximum advantage. Employing the best systems makes the process cost effective and profitable. The steps are quite straightforward and clear.

The Prescriber

  • Physicians, clinicians or practice staff logs in to the system, after appropriate security verification.
  • Prescribers identify the patient health record (PHR) to the system.
  • Physicians prescribe, add or modify medication and select the pharmacy to fill the prescription.
  • Prescribers transmit this data to a transaction hub, which checks patient eligibility, makes formulary evaluation and fill status decisions, sending hub conclusions back to prescribing entities.

Transaction Hub

  • Links prescriber, pharmacy and pharmacy benefits manager (PBM) together.
  • Maintains a database of a master patient index and pharmacies.
  • The PBM determines eligibility, formulary and meds history back to the hub, which transmits back to the prescriber, awaiting a proceed or cancel decision.


  • Receives prescription and confirms receipt with the hub.
  • May contact physicians’ offices through the system to verify renewal requests.
  • Sends data regarding patient medication pick-up to prescribers back through the system.

E-prescribing is a graphic example of the way having the best IT system can help a practice with digital solutions. The other side of that same coin dictates that having an outdated system can increase costs, while reducing revenue and profitability.

Changing Practice IT Infrastructure

EHRs are dictating changes in practice computer infrastructure. E-prescribing is only one important component, but possibly the most effective cost and time saving element. It seems that employing the most efficient IT systems make a major difference in cutting or increasing costs.

Sharing lab data also improves your P4P profile, but without up-to-date digital systems, your P4P incentive may be offset by the increased costs of staff time locating, preparing and faxing requirements to share this important information with other physicians.

EHRs, e-prescribing and P4P are intended to help practices increase revenues and cut costs. However, they require up-to-date, efficient IT systems to reach these goals. Those with out of date systems should strongly consider upgrading their IT to help their practices earn more revenue, while cutting costs. The alternative will only hurt your practice revenues and profits. This is a wise technology investment.


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