Healthcare processes and IT: Exploring Productivity Gains through Improved Allocative Efficiency

The benefits of health information technology (HIT) are widely accepted. Nonetheless, how HIT becomes embedded and transforms health-care processes remain an understudied area in the literature. In this study we extend prior research by undertaking a more granular examination of HIT systems’ impact on how non-IT resources are allocated to healthcare tasks and routines. The context of our research is a natural field study whereby an acute-care hospital implemented telemedicine as a tool to consult its geriatric patients. We collected and analyzed resource and patient consultation level data, both pre and post technology use to quantify possible shifts in resource allocations as well as cost efficiencies over time. Our findings suggest that HIT affords changes to non-IT resource allocations in clinical work processes which lead to changes in cost efficiencies. Depending on the nature of these non-IT resource reallocations, cost efficiencies may not always be improved.