Cost-Benefit Analysis of an Electronic Medical Record System in an Emergency Unit-Based Private Practice in South Africa

Abstract

Background In South Africa, various electronic medical records systems (EMRS) have been implemented in both the private and public healthcare sectors. Currently, there is lack of evidence on the economic consequences of adopting EMRS in the South African context. The aim of this study is to estimate the cost-benefit of adopting EMRS in an emergency hospital setting in South Africa. Methods A retrospective cost benefit analysis was conducted to ascertain the economic consequences of EMRS use compared to a Paper-based Medical Records System (PMRS) in a private practice which runs 25 emergency units in South Africa. The EMRS was implemented in these emergency units from 2019. Out of the 25 emergency units currently being managed by the practice, 18 were identified to meet the study criteria and were thus selected as part of the sample. Cost data was collected from existing records and from interviews with experts where data was not available. Costs for the EMRS included development costs, hardware costs, installation costs, training costs, software costs, personnel costs, and printing costs. Costs for the PMRS included costs for stationery, storage space, transportation and personnel. The measured amounts were discounted by the expected interest rate and inflationary adjustments made using the consumer price index (CPI). The outcomes of interest were the net present value (NPV), benefit-cost ratio (BCR), and discounted payback period (DPP). The benefits included cost reductions after EMRS adoption. A time horizon from 2017 to 2024 was adopted for the analysis. Results V Over the period 2018 to 2024, PMRS costs decreased by 85% from R2,868,554.60 (US$153,948.35) in 2018 to an estimated cost of R423,186.45 (US$22,711.39) in 2024. The total cost for the EMRS implementation and maintenance was estimated at R11,396,872.79 (US$611,642.45). From the start of implementation in 2019 till 2024, the total estimated cost savings for the study sample were R6,668,580.76 (US$357,886.51). A NPV of -R4,728,292.02 (-US$253,755.94) and a BCR of 0.59 were estimated. The DPP was approximately 6.97 years. Conclusion Even though the adoption of the EMRS resulted in reduction of PMRS costs, there was no positive cost-benefit with the EMRS intervention shown over the study period. Post- implementation, it is expected to take almost 7 years for the practice to breakeven with the EMRS intervention. Reducing EMRS costs and further reducing concurrent PMRS usage may potentially result in the intervention having positive economic returns and may shorten the time taken to breakeven.