WASHINGTON—Delays in the rollout of health information technology (HIT, or health IT), especially among smaller medical practices, could complicate efforts to reduce healthcare costs and reform the overall health insurance system, physicians groups argued to Congress on June 24.

During a hearing of the House Committee on Small Business, Subcommittee on Regulations and Healthcare, lawmakers said that, as Congress and the Administration seek to tackle rising health care costs, widespread adoption of HIT and Electronic Health Records (EHR) can play a critical role in reducing costs and improving the quality of care.

“Meaningful discussion of healthcare reform has to start with the cost issue,” Subcommittee Chairwoman Kathy Dahlkemper, D-Pa., said. “While there is no silver bullet, new technology in the form of Health IT and electronic health records will not only improve the quality but the affordability of medical care delivery. Some experts estimate that wide scale adoption of HIT would lead to annual savings of $77 billion.”

Despite this technology’s potential, its adoption among smaller providers has been hampered. Dahlkemper said only 13 percent of small and solo practitioners have basic electronic health record EHR systems, even though 80 percent of all outpatient visits take place in practices with ten or fewer doctors. She added that although the American Recovery and Reinvestment Act (ARRA), dedicates $19 billion to promote use of EHR systems, large upfront costs prevent smaller practices from adopting the new systems. This problem has been compounded by tight credit markets making difficult for physicians to borrow funds for HIT adoption.

“The initial investment required for HIT is enough to make smaller practices think twice and, for many physicians, simply puts this technology out of reach,” Dahlkemper said. “This ‘health IT gap’ between large practices and small practices is particularly significant when you consider that the vast majority of treatment occurs in small doctor’s offices."

Dahlkemper said that she is introducing the Small Business Health Information Technology Financing Act to help providers overcome the financial barriers for HIT adoption. The legislation would establish a new program at the Small Business Administration to guarantee loans made to physicians seeking to invest in Health IT.  Witnesses told the Committee that, if enacted, the new program would help small health care providers purchase and implement HIT systems in their practices.

“By encouraging smaller practitioners to adopt electronic health records and Health IT, we can reduce costs for the overall healthcare system,” Dahlkemper continued. “However, to achieve this goal, physicians need to access the capital to make the initial investment in the technology infrastructure.”

Click HERE to view video from the hearing.