Health and Human Services' Estimate of Health Care Cost Savings Resulting from the Use of Information Technology Page: 1 of 11
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Accountability * Integrity * Reliability
United States Government Accountability Office
Washington, DC 20548
February 16, 2005
The Honorable Jim Nussle
Committee on the Budget
House of Representatives
Subject: Health and Human Services' Estimate of Health Care Cost Savings Resulting
from the Use of Information Technology
Dear Mr. Chairman:
According to the Institute of Medicine and others, the U.S. health care delivery
system is an information-intensive industry that is complex, inefficient, and highly
fragmented, with estimated spending of $1.7 trillion in 2003. The Institute of Medicine
has called for transformational change in the health care industry through the use of
health information technology (IT) to improve the efficiency and quality of medical
care.' As a regulator, purchaser, health care provider, and sponsor of research, the
Department of Health and Human Services (HHS) has also been working over the
years to promote the use of IT in public and private health care settings.
As you requested, we are currently working to provide you with an overview of HHS's
efforts to develop a national health IT strategy, identify lessons learned from the
Departments of Veterans Affairs and Defense regarding their use of electronic health
records (EHR),2 and identify lessons learned from international efforts to modernize
national health IT infrastructures. As part of this ongoing work, you asked us to
review how a recent HHS estimate of cost savings from the adoption of IT was
derived and what portion of these savings are projected for the federal government.
To develop this correspondence, we reviewed supporting documentation,
interviewed HHS officials on potential cost estimates, and reviewed the methodology
used to develop projected cost savings and other benefits. We performed our work in
January 2005, in accordance with generally accepted government auditing standards.
'Institute of Medicine, To Err Is Human: Building a Safer Health System (Washington, DC:
November 1999) and Crossing the Quality Chasm: A New Health System for the 21st Century
(Washington, D.C.: March 2001).
2 There is a lack of consensus on what constitutes an EHR, and thus multiple definitions and names
exist for EHRs, depending on the functions included. An EHR generally includes (1) a longitudinal
collection of electronic health information about the health of an individual or the care provided,
(2) immediate electronic access to patient- and population-level information by authorized users,
(3) decision support to enhance the quality, safety, and efficiency of patient care, and (4) support of
efficient processes for health care delivery.
GAO-05-309R HHS's Estimate of Savings from Health IT
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United States. Government Accountability Office. Health and Human Services' Estimate of Health Care Cost Savings Resulting from the Use of Information Technology, text, February 17, 2005; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc302865/m1/1/: accessed February 19, 2019), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.