Buy a knee brace online and, chances are, the transaction triggers an immediate cascade of updates that propagate through inventory, supply chain, financial, and other core business systems. Thank an enterprise resource planning (ERP) system for that.
Take home a knee brace provided at a hospital’s outpatient clinic, and that transaction may well stay right where it is – at least for a while.
An electronic health record (EHR) is where it is. This vital hub for clinical data is also where it should be. But the knee brace’s distribution should also be in the hospital’s ERP system, the hub for business data capturing operational, financial, and administrative information. The knee-brace transaction will eventually make its way from EHR to ERP. But the timing and how much detail is shared can vary widely, depending on the EHR and the ERP system.
Addressing such variability and inconsistency is an increasing focus across a health care industry aiming to rein in costs, boost patient safety, sharpen visibility into operations, and improve the efficiency and effectiveness of patient care. Integrating EHR and ERP systems is fundamental to that effort.
EHR and ERP integration has been a long time coming
Such integration has been slow for a few reasons. One is the primacy of the EHR, which is understandable, because appropriate, safe care delivery should be the paramount focus. But that’s put business systems in the back seat.
Industry consolidation has also made deliberate, strategic EHR-ERP integration harder to manage. With the mergers of entities running different EHRs and ERPs, getting it all to play nicely together (as opposed to taking the time and effort to consider optimal outcomes) has predominated. Another hurdle has been an industry tendency to go on customizing and running legacy systems longer than generally advisable given functional limitations, maintenance costs, and IT security concerns.
But EHR-ERP integration is now being taken more seriously, and health care institutions can expect three main benefits from that integration: better analytics, sharper visibility into inventory and the supply chain, and smoother financial-information flow.
Better analytics
EHR-ERP integration enables real-time analytics based on combinations of clinical, operational, and financial data. That empowers quick responses to changing circumstances as well as better forecasting of patient trends, resource needs, and financial planning.
Say the patient who got that knee brace later needs a knee replacement, and the surgeon insists on a particular brand of implant. Analytics based on EHR and ERP data could combine actual patient outcomes with inventory and financial data to show that similar products at lower price points perform equally or better. The scope of such insights could then extend to updated standards across the locations of a large health care system, reducing trunk stock/inventory cost and helping drive efficiency more broadly.
Sharper visibility into inventory and the supply chain
EHR-ERP integration helps optimize supply chain resource allocation by tracking inventory, staff scheduling, and equipment usage. That combination can spot bottlenecks and resource shortages as well as identify organizational inefficiencies that might otherwise take much longer to surface.
With that knee replacement, the inventory impacts of the procedure are immediately understood, so the inventory status of everything associated with the surgery and all other knee replacements happening across a hospital or health system is immediately clear. That’s helpful when things run smoothly, but also when they don’t, such as with a product recall.
With integrated EHR and ERP systems, managers can instantly see where the product has been used and where it’s still in inventory across the system, enabling immediate stop-use notifications and speedy outreach to past patients where applicable. That knowledge then feeds into the search for alternatives to the recalled products.
Smoother financial-information flow
EHR-ERP integration enables the seamless flow of charges, payments, and adjustments from clinical to financial systems. That simplifies claims processing and minimizes human error by automatically pulling accurate patient and treatment data into financial workflows.
Those are just three examples of what integrating the two core systems of health care can bring, and the benefits will continue to accrue as EHR-ERP integration becomes more in-depth (in terms of the breadth of information being shared between EHR an ERP systems) and widespread (that is, across the health care landscape).
Broadly speaking, EHR-ERP integration makes for more effective, more adaptable, and far more scalable systems for health care institutions looking to plan and execute better, drive down costs, and, most importantly, provide patients with the best-possible care.
Matt Pomrink
As the Industry Executive Advisor for Healthcare in North America, Matt works with healthcare systems, payers and technology companies to support their business transformations based on the ever-changing healthcare landscape. He has over 25 years of experience in supply chain, solution strategy and innovation services. Matt has international experience as a Board Member and C-Level Executive for socially conscious organizations, focused on supporting under-served patients in developing countries.
