Despite the technological explosion among practice management products now on the market, many physicians and practice administrators are wary of spending $10,000, $20,000, $50,000, or even $1 million for a large group to install the latest tools in their offices. The source of the reluctance may even be the revolution in technology itself. (How many of us recall seeing our state-of-the-art personal computer grow into obsolescence within months?)
If you're willing to accept some extra worries and less control over the data, though, an application service provider (ASP) might offer you a chance to modernize the business side of your practice without having to take out a second mortgage. The ASP model brings more advantages than just cost savings, but it also brings a host of new concerns to the decision-making process.
What Is an ASP And What Can it Do?
An ASP is a company that enables physician offices to lease software and store data in the company's remote server for a monthly subscription fee.
The first key word here is "lease." You're not buying anything other than the desktop computers … no site licenses, no big mainframes, no equipment maintenance agreements. The second key word is "remote." It's not in your office. It may be thousands of miles away. In most cases, the office accesses the ASP software and data over the Internet.
Despite those differences, ASPs can provide many of the same services as traditional, in-office practice management systems. Though it may not offer as many features, ASP software can handle:
- Electronic medical records (including transcription and voice recognition);
- Patient scheduling and registration;
- Claims submission, eligibility inquiries, referrals, and preauthorizations (depending on the health plan);
- Financial reporting and collections management; and
- Supply ordering.
A widely quoted 2000 study by International Data Corp. estimates that the overall U.S. market for ASPs - in all industries - will grow from $200 million in 1999 to $6 billion in 2003. Any product with that kind of market clout has to have a few things going for it. Or it should.
Physicians who go the ASP route for practice management software should expect to see:
- Upfront cost savings: $100 to $300 per month per physician for ASPs versus a multi-thousand-dollar investment plus several thousand a year in maintenance.
- Easy upgrades: An ASP can install software improvements at its central server one night, and the office can take advantage of them the next day.
- Staff or contract savings: Most ASPs manage all of the software and data maintenance, so the practice doesn't need to hire an information technology staff, or outside contractor, to handle that chore.
- Ease of use: ASPs tend to employ a point-and-click interface familiar to most PC users. The learning curve is relatively flat.
- Off-site access: Because most ASPs offer their services over the Internet, a physician or practice manager can log on from home or from a satellite office.
On the Other Hand
We all know there's no free lunch and you get what you pay for. There are some definite trade-offs for physicians who opt for an ASP over an in-house system. Here's what to consider:
- Access to your records: How fast should your Internet connection be to provide you with a response time you don't find annoying? How much will that cost? What about Internet down times? Many observers advise offices to devise a way to keep paper copies of all records they store on-line. And larger practices are advised to use a more reliable - and more expensive - frame-relay connection to their ASP.
- Access to your records, part 2: What happens if or when the vendor is purchased or goes out of business? Who owns the records? How quickly can you get them back? Include these protections in any contract you sign.
- Security of your records: We've all read the stories of patients' charts posted on the World Wide Web for the whole world to see. Ask any potential vendor about firewalls, password arrangements, encryption (128 bit or better), and HIPAA compliance.
- Features: Although almost all of the conventional practice management vendors now offer ASP versions of their software, they're rarely identical. Find out what tools aren't available online, and make sure you can live without them.
A final word: As with any major purchase, don't be the first doctor on your block to buy a particular product. Make sure the vendor has the financial wherewithal to stay in business for the long term, and check with friends and colleagues to find out what systems they use - and why.
by Steve Levine, TMA Communication Director