The Trillion Dollar Conundrum: Complementarities and Health Information Technology
- (pp. 239-70)
AbstractWe examine the heterogeneous relationship between the adoption of EMR and hospital operating costs at thousands of US hospitals between 1996 and 2009. We first document a previously-identified puzzle: Adoption of EMR is associated with a slight cost increase. Drawing on the literature on IT and productivity, we analyze why this average effect arises. We find that: (i) EMR adoption is initially associated with a rise in costs; (ii) EMR adoption at hospitals in IT-intensive locations leads to a decrease in costs after three years; and (iii) Hospitals in other locations experience an increase in costs even after six years.
CitationDranove, David, Chris Forman, Avi Goldfarb, and Shane Greenstein. 2014. "The Trillion Dollar Conundrum: Complementarities and Health Information Technology." American Economic Journal: Economic Policy, 6 (4): 239-70. DOI: 10.1257/pol.6.4.239
- D24 Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- I11 Analysis of Health Care Markets
- M15 IT Management
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