Why EHRs Are Not (Yet) Disruptive

In 2005, Rand Corporation projected widespread use of electronic health records (EHRs) could save the U.S. $81 billion per year in health care. Eight years later, more than 80% of hospitals use EHRs and have received incentive payments for their “meaningful use,” yet projected savings have still not materialized.  Many blame our bloated hospitals for this disappointing shortfall.

We disagree. EHRs are not unsuccessful because of health care providers’ ineptness. Rather, they are a potentially disruptive technology that got caught in a legacy business model that can only prioritize sustaining innovations.

What makes an innovation “disruptive”?

Disruption does not just mean ‘idea making waves’ or ‘breakthrough technology.’ Rather, disruptive innovation theory explains how companies with cheaper, lower performing technologies target non-consumers or low-end customer segments and grow upmarket to eventually kill larger competitors with less expensive, simpler products. The personal computer, for example, disrupted the mainframe and minicomputer industry.