Changes in health care delivery, reimbursement, and information technology (IT) are prompting many outpatient care providers to reassess their practice management systems (PMSs). Among the motivating factors are these: (1) Clinics and practices are planning to implement an electronic health record (EHR) and seeking PMSs that will more smoothly integrate with it; (2) Many older PMSs do not adequately support electronic data exchange according to specifications in the Health Insurance Portability and Accounting Act (HIPAA). Clinics and medical practices are recognizing the value of such transactions in streamlining administrative tasks; (3) Newer PMS products based on the application service provider model have created opportunities for clinics and practices to outsource IT maintenance tasks they previously had to perform themselves; (4) Clinics and practices that want to outsource their billing functions are becoming aware of the ability of Web-based PMSs to facilitate information exchange between their staffs and billing firms; and (5) The changing business fortunes or acquisitions of some PMS vendors have caused their products to be discontinued, orphaned, or minimally supported. These products are no longer upgraded, which creates problems for users in a rapidly changing health care environment. For example, health plan support for electronic eligibility checks under HIPAA and recent implementation of the National Provider Identifier have created new requirements that only updated PMSs can meet. Given the hundreds of PMS vendors and dozens of product variations on the market, providers considering a PMS upgrade face many choices. Safety-net clinics (SNCs) and small physician offices (SPOs) are among outpatient providers navigating the market. These two practice settings, which play an important role in providing primary care to both underserved and mainstream populations in California, have a number of special PMS needs. This report examines those needs and provides an overview of the related technical architectures, functional differences, integration capabilities, and service offerings of PMSs. It does not evaluate or compare individual products, but rather offers a framework for understanding current PMSs and evaluating the differences among them. The report also highlights specific factors that bear on the PMS purchasing decisions of SNCs and SPOs, including whether and when an organization plans to adopt an EHR, and makes several recommendations.
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