How can we bend the cost curve? The impact of accelerating electronic prescribing on hospitals' productivity levels: Can health information technology bend the curve?

This paper examines how different strategies for implementing computerized prescriber order entry (CPOE) impact hospitals' productivity. We used the American Hospital Association's Annual Survey to construct hospital-level measures for 1,812 facilities and analyzed the productivity indices against CPOE use rates. The relationship between CPOE use rates and indices for "technical efficiency change" and "total factor productivity" was significant. Hospitals introducing CPOE facilitywide in a one-year period (where usage went from zero to more than 50%) experienced declines in both productivity indices. One implication is that hospitals achieving the goals of the "meaningful use" programpromoted by the Centers for Medicare and Medicaid Services may do so at the expense of productivity.