Working Paper: NBER ID: w18281
Authors: David Dranove; Christopher Forman; Avi Goldfarb; Shane Greenstein
Abstract: We examine the relationship between the adoption of EMR and hospital operating costs. We first identify a puzzle that has been seen in prior studies: Adoption of EMR is associated with a slight cost increase. We draw on the literature on IT and productivity to demonstrate that the average effect masks important differences across time, locations, and hospitals. We find: (1) EMR adoption is initially associated with higher costs; (2) At hospitals with access to complementary inputs, EMR adoption leads to a cost decrease after three years; (3) Hospitals in unfavorable conditions experience increased costs even after six years.
Keywords: No keywords provided
JEL Codes: I10; L30
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| EMR adoption (I18) | hospital operating costs (I11) |
| availability of local IT skills (L86) | hospital operating costs (I11) |
| hospital operating costs (I11) | EMR adoption (in IT-intensive markets) (I11) |
| hospital operating costs (I11) | EMR adoption (in non-IT-intensive locations) (I11) |
| complementary inputs (D10) | hospital operating costs (I11) |
| pre-existing IT experience (M15) | hospital operating costs (I11) |
| EMR adoption (I18) | costs after three years (IT-intensive markets) (L15) |
| EMR adoption (I18) | costs after three years (non-IT-intensive locations) (F29) |
| availability of complementary assets (D10) | hospital operating costs (I11) |