Most CPA Insider™ readers have no reason to know that early in my career, I wrote medical software. Since my personal mission has long been “to help as many people use technology in the way that benefits them the most,” I have long thought that technology in healthcare has the potential to benefit large numbers of people.

I have maintained a Web page for healthcare for some time. Some examples of using technology in healthcare include:

• Medical implants — artificial eyes, hearing assists and others
• Tracking patient care — the increasingly popular, but still difficult Electronic Health Record (EHR)
• Practice Management — including automated billing, insurance filing and financial reporting

The healthcare industry is changing rapidly from new developments driven by advancements in medicine, pharmaceuticals and technology. It is estimated that 30 percent of the systems will be replaced in the next five years. However, the systems will have better patient tracking and more convenient payment processing, as well as have diagnostic tools and recommendations that will be built into the systems. Part of this is driven by new regulations, and part of the change is occurring because the software is just beginning to catch up to what the practices need.

A futuristic area of healthcare has been the improvement of medical implants. Whether it is the BrainGate™ Neural Interface System or AbioCor, the world's first completely self-contained replacement heart, there are dozens of technologies to replace worn out or defective parts of the human body. Recent developments include hearing assist, vision assist, as well as personalized pharmacology.

In another important area, electronic health records (EHR) is just coming of age. There are dozens of providers, but many are clumsy to use in practice. They have not been living up to the promise of better healthcare for patients and ease of use for doctors. Instead of making healthcare easier, the systems have inserted expense, time and impersonal interaction in the healthcare encounter. New, durable handheld computers, along with easier to use software are just making inroads to the profession. We expect a time when all providers of healthcare will interact with an EHR system to log activities and patient status. Hopefully, drug interactions and patient reactions to drugs will be included in these systems. The Economist recently suggested that this century will be the century of biology and the last century was that of technology. Computers are helping us understand how our bodies work.

Finally, there are new requirements for patient billing systems. With healthcare IRAs, and the requirements for needed diagnostic medicine to be recommended at the time of an encounter, payment systems and the interaction at check-in for routine medical care is going to have to change. With pay-for-performance, or as I prefer to call it, pay-for-reporting, there is a need for practice management automation to receive payments easily from multiple sources, and to recommend procedures for patients while protecting their privacy to under the Health Insurance Portability and Accountability Act (HIPAA). This will require new practice systems. Some analysts are predicting that over 30 percent of healthcare practice systems will be replaced by 2015. I suspect that is part of the reason that mainstream vendors like Sage Software have purchased products like Emdeon, and started healthcare divisions. Sage is providing both EHR and Practice Management. System replacement is motivated by additional payments from insurers for compliance in addition to the opportunity to use the new generation healthcare diagnostics. Additionally, doctors in practice today have been around computers for most of their careers, and the industry is just beginning to accept the power of computing to leverage medical skill. The next 25 years in medicine will be an exciting time to watch technology assist the healthcare field.

Randolph P. Johnston is Executive Vice President of K2 Enterprises, a technology consultancy serving the accounting profession. He is a nationally recognized educator, consultant and writer with over 30 years' experience in Strategic Technology Planning, Systems and Network Integration, Accounting Software Selection, Business Development and Management, Disaster Recovery and Contingency Planning, and Process Engineering.