Table 5.
Estimated Impact of CPOE on Hospital Operating Margins, “Low” CPOE Cost Estimates
| Urban | Rural Referral | Rural | Critical Access | |
|---|---|---|---|---|
| Operating margin (%, 2001) | 3.7% | 5.0% | 2.4% | −0.1% |
| Post-CPOE margin (Y1/Y2) | ||||
| Reference case* | 3.3/3.1 | 4.4/4.0 | 0.3/−1.1 | −1.5/−2.4 |
| Lower fixed/marginal cost | 3.5/3.3 | 4.6/4.4 | 1.3/0.5 | −0.9/−1.4 |
| Interest rate | ||||
| 3.0% | 3.4/3.1 | 4.4/4.0 | 0.5/−1.1 | −1.4/−2.4 |
| 7.0% | 3.3/3.1 | 4.3/4.0 | 0.2/−1.2 | −1.6/−2.5 |
| Depreciation | ||||
| 3 years | 3.2/2.9 | 4.0/3.7 | −0.8/−2.1 | −2.3/−3.1 |
| 7 years | 3.4/3.2 | 4.5/4.1 | 0.8/−0.6 | −1.2/−2.1 |
| Third-party reimbursement | ||||
| 25% | 3.4/3.2 | 4.5/4.2 | 0.8/−0.2 | −1.2/−1.9 |
| 50% | 3.5/3.4 | 4.6/4.4 | 1.3/0.6 | −0.8/−1.3 |
| 75% | 3.6/3.5 | 4.8/4.7 | 1.8/1.4 | −0.5/−0.7 |
*
5% interest, 5-year depreciation period, no third-party CPOE cost reimbursement (except Medicare for critical access).