HIT and Privacy Laws

An article in the journal Management Science finds that privacy laws inhibit the adoption of electronic medical records technology.  (article abstract)   The federal government is spending an enormous amount of money to promote adoption of health information technology and intends to penalize providers who don’t use it.  There is widespread promotion of the notion, which is not always supported by the available evidence, that HIT will improve quality and cut costs.  But as is often the case, while the government is encouraging HIT adoption, it is also responsible for creation of barriers, in this case privacy laws.

The study found that found that states with strict privacy laws had a 24% reduction in hospital uptake of EMR systems, compared to a 21% increase in states without such laws.  The reason is fairly obvious.  Such laws inhibit the ability to collect and share useful information, sharply decreasing the value of the systems.   The federal HIPAA law can itself be a fearsome challenge to collection and use of health information.  Governments need to decide what their overriding objective is and if it is true health reform that requires more use of HIT, they need to remove the barriers they have created to its adoption and utility.