Functional IT Complementarity and Hospital Performance in the United States: A Longitudinal Investigation

For healthcare practitioners and policymakers, one of the most challenging problems is understanding how to implement health information technology (HIT) applications in a way that yields the most positive impacts on quality and cost of care. We identify four clinical HIT functions which we label as order entry and management (OEM), decision support (DS), electronic clinical documentation (ECD), and results viewing (RV). We view OEM and DS as primary clinical functions and ECD and RV as support clinical functions. Our results show that no single combination of applications uniformly improves clinical and experiential quality and reduces cost for all hospitals. Thus, managers must assess which HIT interactions improve which performance metric under which conditions. Our results suggest that synergies can be realized when these systems are implemented simultaneously. Additionally, synergies can occur when support HIT is implemented before primary HIT and irrespective of the order in which primary HITs are implemented. Practitioners should also be aware that the synergistic effects of HITs and their impact on cost and quality are different for chronic and acute diseases. Our key message to top managers is to prioritize different combinations of HIT contingent on the performance variables they are targeting for their hospitals but also to realize that technology may not impact all outcomes.