EHR software means the days of paper charts, bulky patient files and record rooms are relics of the past. But, like cameos in a Marvel movie, EHR implementation will cost you a pretty penny. Wondering just how much? Health Affairs pegs EHR implementation cost at $162,000 for a five-physician practice.
If you’ve finally convinced upper management to get rid of your DOS-looking software (that may or may not have been around since the 80s) or you’re in the process of lobbying for a new solution, saying you need a six-figure budget right off the bat may not leave you with many friends in accounting.
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In lieu of publicly available information on EHR costs, I emailed multiple EHR companies, read research papers, spoke to a healthcare analytics company and reached out to clinicians. Here’s what I found.
Key Takeaways
- The average EHR implementation cost for a five-physician practice is $162,000, including $85,000 in maintenance costs.
- Implementation costs can be divided into direct and indirect costs. Direct costs are dependent on on-premise or cloud-based deployment while indirect costs include training fees, staffing-related costs and unexpected costs like security.
- To accurately budget for EHR implementation, account for hardware and software, implementation, training and ongoing costs.
- Reduce direct costs by talking to your Regional Extension Center and minimize indirect costs by appointing an implementation champion.
Implementation Costs
Figuring out how much EHR costs is like unraveling the Marvel multiverse without confusing one timeline for another (it’s not easy, I’ve tried).
Say you demoed products, shortlisted contenders and decided on the chosen one. You’re prepared to pay the (exorbitant) price quoted, so you’re all set now… right? Well, not quite. Unfortunately, implementation comes with its own set of bills. We’ve taken the time to evaluate the direct and indirect expenses so you have a better idea of how much EHR costs.
Direct Costs
A large chunk of your implementation expenses will vary depending on which deployment method you choose (on-premise vs. cloud EHR).
| Cloud | On-Premise |
| Vendor-Hosted | Self-Hosted |
| Monthly or Annual Subscription Fee | Larger Upfront Fee |
| Costs Increase with Additional Users | Costs Include Hardware and Maintenence Fees |
On-premise
One way to implement electronic health records is to host the EHR solution on your own servers. You’ll need to purchase a perpetual license, which usually comes in the form of a large upfront fee.
Choosing an on-premise solution means you’ll have to manage all of the back-office technology, including heavy-duty servers, some form of data backup, data storage and possibly other technologies as well. Maintenance costs for the first year should also be accounted for, with bills running up to $85,000 on average.
Cloud-based
The second option is cloud-based deployment. Your data is stored on the vendor’s servers, and you access it through the internet. Costs include an ongoing subscription fee paid monthly or annually. If you choose to deploy a cloud-based EHR system, you may pay upfront costs (though not nearly as much as an on-premise fee) in addition to the subscription.
Of course, given that the vendor handles the hosting, you won’t need to shell out money for extra servers, storage, data reserves, security and the like. However, you may need to pay more depending on the number of users you need to access the software. For example, eClinical Works charges an additional implementation fee for practices with more than nine providers.
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Indirect Costs
Once you’ve accounted for initial and standard implementation fees; you’re halfway (maybe one-third) of the way there. We’d be remiss if we didn’t mention those sneaky indirect costs that can creep up on you and give your accounts department quite a scare.
For starters, you need to include EHR training as an item in your implementation budget. But, that’s not the only cost you’ll be racking up. Dr. John Anhalt, an Attending Physician at Wills Eye Hospital, says costs can come in unexpected forms.
Implementation of a new EMR can impose significant costs on a practice, beyond that of the initial purchase agreement. Some are readily identifiable, such as purchasing new software or updating old IT systems. Others, however, are less tangible, the effects of which can last months beyond the initial implementation.
These costs may include a decrease in clinician productivity as they learn a new EHR, system downtime, the opportunity cost of practice personnel attending training courses in lieu of performing patient care and decreased staff job satisfaction. The last of which is perhaps the most difficult to quantify. However, anecdotally, practices have observed difficulty in retention of both clinicians and support staff during the implementation of a new EMR. The result is a tremendous financial and human resource stress on a practice.
Staffing-Related
Additionally, you may need to consolidate your IT staff after the software goes live. Almost every medical practice has to keep some IT tools (such as practice management software or email servers) available around the clock, but it may not be enough with a new system.
While most cloud-based vendors provide their own technical support, on-premise systems typically require an IT team of your own.
If you suspect that your IT team is already overloaded, try the following steps:
- Budget for temporary IT help.
- Conduct regular maintenance for on-premise EHRs.
- Consider hiring a temporary physician or clinician to maintain patient volume.
- Provide adequate support to ensure smooth EHR implementation.
- Plan for the worst-case scenario to prevent any setbacks.
Expect the Unexpected
The internet dictates that we live in a society that is (sometimes) perilously interconnected. That can come with its own costs. For example, you may need to pay additional integration costs for better interoperability, shell out money for a security system (although that backfired during the Crowdstrike fiasco) and hire a third-party to help with data migration.
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How to Budget for EHR Implementation
To say getting an accurate estimate for EHR implementation costs is difficult would be an understatement. It varies from system to system and practice to practice. However, it doesn’t need to be as complicated as scheduling OR days.
There are five key components you need to budget for:
Hardware and Software
Hardware includes devices like laptops, tablets, servers and accessories, such as scanners and printers. Software includes not just upgrades but also EHR apps and interface modules, and the cost of obtaining software is equivalent to the deployment method.
Implementation
Implementation costs can be extensive, including attorney fees, consultation support, security and technicians. If your practice requires IT contractors, specialty-specific customizations and redesigning support, discuss these costs with product vendors and their partners.
Phillip Spence, Strategic Partnership Manager at Healthmonix, explained how augmentations and additional products and services play a role in EHR implementation costs.
Not all EHRs are created equal. At least, not all EHRs provide their solutions and services natively within their own products. It’s increasingly common for EHRs to utilize an ecosystem approach to offer connections to other best-in-class software. This gives each client the flexibility to augment an EHRs core offering with additional offerings that might be needed for the unique needs of each practice.
For example, our company partners with many EHRs, as well as provides services directly to many physician practices, health systems and accountable care organizations, to provide clients with more robust tools for meeting value-based care requirements. With some EHR partners, our costs are included within the total cost of the EHR. With other EHR partners, clients will be directed to contract with us through the EHR’s ecosystem if they choose to engage with our additional products and services.
Training
In a perfect world, your new EHR would fit into your old system like a perfectly-shaped piece for an oddly-sized hole in Tetris. But, alas a perfect match is highly uncommon. Your doctors, clinicians and admin staff will need training to master a new solution. Some solutions bundle free training in with their costs, and others have a training fee or offer advanced courses you’ll need to add to your budget.
Ongoing Costs
Ongoing costs include both maintenance and running costs such as support, internet and agreement costs. To reduce costs, practices can consider using open-source EHR software or partnering with vendors who offer flexible pricing plans.
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Cost of Top EHR Solutions
A new EHR doesn’t have to set you back by millions (although, according to Beckers Hospital Review it can). I asked our analysts how much our top-rated solutions cost and they came through with the following information.
| Product | NextGen Enterprise | DrChrono | Cerner Ambulatory | eClinical Works | athenahealth |
|---|---|---|---|---|---|
| Starting Price | $600 | $250 | $5,000 | $449 | $550 |
| Pricing Model | Per Provider, Monthly | Per Provider, Monthly | Per Provider, Monthly | Per Provider, Monthly | Per Provider, Monthly |
| Free Trial | Yes, Request for Free | Yes, Request for Free | No | Yes, Request for Free | No |
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FAQs
No, you only need to sign a contract with a certified EHR company is the minimum requirement to begin meeting meaningful use standards. In other words, you don’t even need to have it fully implemented in order to receive benefits.
This is a result of the final amendments to the payment systems for acute care hospitals in 2023 issued by the Centers for Medicare & Medicaid Services on August 1st, 2022. The new Medicare Promoting Interoperability Program will include new policies to incentivize eligible hospitals and critical access hospitals (CAHs) to demonstrate meaningful use of EHRs.
Try the following steps to reduce EHR implementation costs:
Contact your local Regional Extension Center (REC): RECs exist to promote EHR adoption. They assist with implementation and achieving meaningful use. And, most relevant to your cost of EHR implementation, they allocate funds to aid health care practices during the transition.
Appoint an implementation champion: A fantastic way to ensure a smooth, streamlined implementation is by selecting a member of your staff to champion the EHR implementation process. This person essentially takes on the role of liaison between your clinicians and the software company. Having someone manage the process — including getting everyone on board and comfortable with the system and keeping staff accountable — can help minimize staffing-related costs.
Although the upfront cost of EHR adoption is the most prominent obstacle, there are several other barriers to consider. These include ongoing costs, maintenance expenses, technical support and potential technical glitches.
The cost of designing and implementing an EHR system is a significant barrier, as it can range from hundreds of thousands of dollars into the millions. The upfront and maintenance costs associated with this new technology can be exorbitant, making it difficult to evaluate the cost-benefit ratio for patients and the technology itself. Obtaining funding from authorities for an EHR system can also be challenging.
There are several time-related obstacles, including acquisition, training, implementation and testing. Health care providers often face challenges while finding time to learn about the new system due to their busy schedules. Additionally, they want assurance that the new system won’t increase treatment time or workload and that it will streamline their routine workflows.
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Next Steps
Counting the cost of implementing an EHR is a tough job, but someone’s got to do it. Although at times it may feel like pricing information is as carefully guarded as the ending of the Avengers, we managed to get a pretty comprehensive look at EHR implementation costs (with a little digging).
But that’s just the first step.
Do you want more in-depth information on overall EHR costs? Check out our free pricing guide to compare the costs and features of top EHR vendors.
Still have questions about the breakdown of EHR implementation costs and how it affects your practice? Let us know in the comment section below.
SME Contributors
Dr. John Anhalt is an Attending Physician on the Cataract and Primary Eye Care Service at Wills Eye Hospital. He also serves as Director of the Academic Global Ophthalmology Fellowship.
Phillip Spence is the Strategic Partnership Manager at Healthmonix and works with partner organizations to help them and their clients to achieve success in value-based care programs such as MIPS. Phillip is passionate about helping individuals and organizations realize and reach their full potential through collaborative and creative solutions.