Keywords: Hospitals, information technololgy, productivity
Abstract: This study measures the impact of information technology (IT) use on
hospital operating costs during the late 1980's and early 1990's.
Using a proprietary eight-year panel dataset (1987-1994) that
catalogues application-level automation for the complete census of
the 3,000 U.S. hospitals with more than 100 beds, this study finds
that both financial/administrative and clinical IT systems at the
most thoroughly automated hospitals are associated with declining
costs three and five years after adoption. At the application level,
declining costs are associated with the adoption of some of the
newest technologies, including systems designed for cost management,
the administration of managed care contracts, and for both financial
and clinical decision support. The association of cost declines with
lagged IT as well as the cost patterns at the less automated
hospitals both provide evidence of learning effects.
Full paper (223 KB PDF)
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Last update: September 19, 2002