Behavioral Health Hospitals: We need EHRs, but incentives would help.

Acute care hospitals have demonstrated what happens when you pay people—when you incentivize them—to do something.

Just 9.4 percent of non-federal acute care hospitals had a basic EHR system in 2008. By 2013 that number had climbed to 59.4 percent. Between 2011 and 2013, the percentage of hospitals with a certified EHR rose from 71.9 to 94 percent, according to the Office of the National Coordinator for Health Information Technology (ONCHIT). These hospitals have been incentivized to implement EHRs through the federal Meaningful Use program, which has thus far paid out over $28 billion.

On the behavioral health side, where there are no federal incentives, only 2 percent of psychiatric hospitals had at least a basic EHR system by 2012, according to a Health Affairs study.  Behavioral health has been conspicuously absent from the Meaningful Use program, to the frustration of many. As a result, many behavioral health providers operate without the efficiencies and complete patient information enabled by interoperable health IT solutions.

Nevertheless, statistical and anecdotal data suggest that behavioral health hospitals are moving in the same direction as acute care, just not as quickly. A growing demand for EHRs and integrated care is tied to an expanded patient pool enabled by Mental Health Parity legislation and the Affordable Care Act, among other factors.  

Industry Surveys

In a recent survey of executives from behavioral health organizations by the market intelligence and management support firm OpenMinds, 30 percent of respondents reported no EHR system in use, suggesting 70 percent are working with an EHR. In a February 2015 survey by Behavioral Healthcare magazine, 79.8 percent of respondents said their facility is using an EHR system.

Does this mean that roughly 70 percent of behavioral health facilities now have at least a basic EHR? Almost certainly, the answer is no. The survey offers a self-selected sample—the readers and clients, respectively, of Behavioral Healthcare and OpenMinds—not the entire industry. Still, numbers that high in a subset of inpatient behavioral health care suggest a trend, as do comments from industry leaders.

“The way things are going, it’s almost going to be impossible to not have an EHR,” Jennifer D’Angelo, chair of the new HIMSS Long Term Care and Behavioral Health Task Force and vice president of information services for Christian Health Care Center in New Jersey, told Behavioral Healthcare. “From an interoperability standpoint, and from a reimbursement standpoint, it’s being required. All levels of care will need to have an EHR for care coordination among all providers.”

Private Equity Investment

Private capital support for health IT expansion in the behavioral health world is rising. In a November 2014 column, Behavioral Healthcare Editor-in-Chief Julie Miller shared a conversation she had with Tim Bechtold of entrepreneurial investment firm Frontier Capital, based in Charlotte, North Carolina.

According to Miller, Bechtold and Frontier are “looking to invest in technology companies under $30 million that are a bit bootstrapped and need capital to grow. Bechtold also says Frontier isn’t the only investor in the space. What that means for providers is that more product innovation is coming thanks to the infusion of capital that’s on its way. Expect to find new products and services that you never even dreamed were possible.”

November 2014 article Wall Street Journal’s Private Equity Beat says, “Private equity firms are keen to invest in behavioral health care.” The Journal adds that, while industry fragmentation is an obstacle to finding the right acquisition target, “that fragmentation makes the sector ripe for consolidation, and the industry segment stands to gain from the convergence of several macroeconomic trends.”

According to Becker’s Hospital Review, “There has been a significant increase in investment interest in behavioral health, including substance abuse businesses, and this investment interest is widespread across the spectrum of investors.”

Industry Activity

According to the Behavioral Healthcare survey from earlier this year, 69.1 percent of respondents have replaced an existing EHR system with a new one. Among those surveyed who don’t have an EHR, 41.3 percent, the largest segment, said the reason was financial; 22.5 percent were in the implementation process; and 13.8 percent were still shopping. Interestingly, 32.5 percent said they lack an EHR because they don’t need one, and 5 percent said they had too much staff resistance.

These figures strongly suggest opportunity for low-cost health IT providers making regular improvements to the system, including moving from localized to cloud-based servers, i.e., a SaaS model. They also suggest that a large segment of the industry—arguably, the 32.5 percent that say they don’t need an EHR—has yet to fully grasp industry trends and envisioned industry-wide interoperability.

A major industry representative, HIMSS clearly sees the need to expand health IT in the behavioral health space. The HIMSS Long Term Care and Behavioral Health Task Force chaired by Jennifer D’Angelo was formed earlier this year with this mission:

Identify topics and issues related to the use of health IT, including capacities reliant upon IT, in the long-term care and behavioral health settings, and what opportunities exist in fully integrating these settings into the continuum of care.

Congressional Activity

Many arguments for Meaningful Use incentives in behavioral health have been promoted by HIMSS, AHIMA and other influential groups. Recently, a panel of health IT stakeholders testified before the Senate Committee on Health Education, Labor and Pensions about progress and remaining challenges for EHR interoperability. 

“We need a reboot of Meaningful Use [due to a] failure to include behavioral health … ,” said Sen. Sheldon Whitehouse (D-RI) during the hearing. “When you cut out behavioral health, the behavioral health provider becomes a medical home.”

In a recent Washington Post article, Rep. Tim Murphy (R-PA) said he plans to reintroduce bipartisan legislation improving mental health services and extending Meaningful Use incentives to mental health providers. While Murphy’s tireless legislative efforts may languish in committee once again, there is a clear determination among key industry leaders and members of Congress to provide Meaningful Use support to behavioral health.


Evaluated in total, evidence suggests that behavioral health is moving toward broad adoption of EHRs. While the extension of Meaningful Use dollars would both hasten the rate of growth and make it much easier to track industry integration, many organizations aren’t waiting on Congress.

Most importantly, with the realization of IT-based interoperability across the healthcare continuum, including integration with behavioral health providers, it will be possible for physicians to rapidly learn exactly what afflicts their patients, and to provide them with precise, improved care.

Click here to learn how Medsphere can help you move to a new EHR-supported future.

D'Arcy Gue is vice president of industry relations for Medsphere Systems Corporation. 

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