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Total Cost of Ownership Template

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					                                                              Total Cost of Ownership for an EHR*

    Category                                      Year 1   Year 2            Year 3             Year 4   Year 5   Total    % of total
1.0 Hardware
1.1 Servers                                       $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
1.2 Client computers                              $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
1.3 Laptops                                       $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
1.4 Tablet computers                              $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
1.5 Smartphones                                   $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
1.6 Peripherals eg., printers                     $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
1.7 Network components                            $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
1.8 Maintenance fees                              $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
    Total Hardware Costs                          $8.00    $8.00             $8.00              $8.00    $8.00    $40.00     24%
2.0 Software                                                                                                                  0%
2.1 ASP Subscription fees                         $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
2.2 EHR Software license(s)                       $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%

2.3 Content licenses (e.g., CPT and ICD)          $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%

    Software tools (e.g., file maintenance
2.4                                               $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
    programs)
2.5 Maintenance fees on software                  $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
    Total Software Costs                          $5.00    $5.00             $5.00              $5.00    $5.00    $25.00     15%
3.0 Systems Management                                                                                                        0%
3.1 Network (e.g., monitoring for outages)        $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%

      Systems (e.g., monitoring and
3.2                                               $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
      troubleshooting)
3.3   Storage (e.g., remote storage)              $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
      Total Systems Management Costs              $3.00    $3.00             $3.00              $3.00    $3.00    $15.00      9%
4.0   Support                                                                                                                 0%
4.1   Help desk support fees                      $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
4.2   Staff                                       $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
4.3   Training fees                               $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
4.4   Travel                                      $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
4.5   Support contracts                           $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
      Total Support Costs                         $5.00    $5.00             $5.00              $5.00    $5.00    $25.00     15%
5.0   Implementation                                                                                                          0%
      Development, customization and
5.1                                               $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
      integration of EHR software
      Initial Training of support staff and end
5.2                                               $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
      users
5.3   Consulting/system integration               $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
      Facilities (e.g., storage and placement
5.4                                               $1.00    $1.00             $1.00              $1.00    $1.00    $5.00       3%
      of hardware, cooling and ventilation)




                                                                      Page 1 of 5
      Total Implementation Costs                     $4.00               $4.00              $4.00               $4.00               $4.00              $20.00              12%
      Data Communication Costs (including
6.0                                                                                                                                                                          0%
      fees, equipment, installation)
6.1 Internet access                                  $1.00               $1.00              $1.00               $1.00               $1.00              $5.00                 3%
6.2 Local Area Network                               $1.00               $1.00              $1.00               $1.00               $1.00              $5.00                 3%
6.3 Wide Area Network / VPN                          $1.00               $1.00              $1.00               $1.00               $1.00              $5.00                 3%
    Total Communication Costs                        $3.00               $3.00              $3.00               $3.00               $3.00              $15.00                9%
7.0 Ongoing Operational Costs                                                                                                                                                0%
7.1 Backup and recovery                              $1.00               $1.00              $1.00               $1.00               $1.00              $5.00                 3%
7.2 Classroom end-user training                      $1.00               $1.00              $1.00               $1.00               $1.00              $5.00                 3%
7.3 Online and internal end-user training            $1.00               $1.00              $1.00               $1.00               $1.00              $5.00                 3%
    Internal staff productivity and payroll
7.4                                                  $1.00               $1.00              $1.00               $1.00               $1.00              $5.00                 3%
    impact
7.5 Income impact                                   $1.00               $1.00               $1.00              $1.00               $1.00               $5.00                3%
7.6 Local file maintenance                          $1.00               $1.00               $1.00              $1.00               $1.00               $5.00                3%
    Total Ongoing Costs                             $6.00               $6.00               $6.00              $6.00               $6.00               $30.00              18%
    Total Costs                                     $34.00              $34.00              $34.00             $34.00              $34.00             $170.00              100%

                   *The data supplied in the spreadsheet is for demonstration purposes only.

                                                                                         Definitions

                                            Calculating the Total Cost of Ownership (TCO) for each of the EHRs you are considering will allow you to better compare the long term
                                            costs of different EHR options rather than just the initial purchase price. If you are considering one or more modular EHRs, be sure to
                                            include the costs of all of the modules plus any integration that may be required. This spreadsheet provides a list of the various cost
                                            categories. Due to the unique nature of each practice, each EHR, and each EHR module, this spreadsheet should be considered a starting
      What is the "Total Cost of Ownership"
                                            point. There are likely to be other cost categories that should be included. Also, some cost categories may have zero costs. For example,
      of an EHR?
                                            an EHR that is accessed via the Internet may not have any server requirement and hence no server cost. Other costs that can be
                                            included but are not reflected above are depreciation expense and the time cost of money which will be influenced by how you finance
                                            your EHR. Because of the definition of the cost categories it is easy to double count, so be careful to compare the costs that you included
                                            in each category with those you included in similar categories.

                                              The capital expenditures and lease fees for servers, client computers, peripherals, network components, and software. Be sure to
1.0 Hardware
                                              include replacement and upgrade costs.


1.1 Servers                                   Larger computers required to support application software and databases. May be located at your practice or at a datacenter.



1.2 Client computers                          Desktop computers in exam rooms and at various workstations.


1.3                                           New laptop computers and software that may be required.
      Laptops



                                                                                     Page 2 of 5
1.4                                            New tablet computers and software that may be required.
      Tablet computers

1.5 Smartphones                                New smartphones that can access your EHR.



1.6 Peripherals eg., printers                  Includes storage devices such as external disk drives, as well as printers and scanners and card readers.



1.7 Network components                         Includes wireless routers as well as cabling and modems.



1.8 Maintenance fees                           Fees for services from an IT Support company, plus any payments for extended warranties or service contracts.



0     Total Hardware Costs


2.0 Software


                                               Fees for access to an EHR or Registry or EHR modules which are accessed via the Internet or via a private network or virtual private
2.1 ASP Subscription fees
                                               network.

                                               The amount you pay in total for the license to your EHR software. Also include any recurring maintenance costs including costs for
2.2 EHR Software license(s)
                                               access to upgrades and new releases.


2.3 Content licenses (e.g., CPT and ICD)       Costs for content from third parties (e.g., CPT tables, ICD tables, Zynx for clinical guidelines, First Data Bank for medication information).

                                               Costs associated with underlying software needed to run the application, such as database management systems, operating systems.
      Software tools (e.g., file maintenance
2.4                                            Sometimes report writers, statistical packages or other tools are required to fully utilize the application; these will have acquisition and
      programs)
                                               ongoing maintenance or subscription costs.

2.5 Maintenance fees on software               Any maintenance fees not included elsewhere.



0     Total Software Costs


                                               The costs associated with network, system and storage management, including labor staffing, maintenance contracts, and professional
3.0 Systems Management
                                               services or outsourcing fees.


3.1 Network (e.g., monitoring for outages)     Fees for monitoring for outages and degradation.




                                                                                        Page 3 of 5
      Systems (e.g., monitoring and
3.2                                             Fees for monitoring servers for outages and degradation. Fees for remote management and troubleshooting.
      troubleshooting)


3.3 Storage (e.g., remote storage)              Fees for offsite storage of data.



0     Total Systems Management Costs


4.0 Support


4.1 Help desk support fees                      Some help desks charge fees for usage, or usage over a certain maximum amount.



4.2 Staff                                       Support staff labor hours including overtime and management overhead. Additional staff required to support a new application.


                                                Costs for formal training including fees to the vendor and opportunity cost (e.g., reduction in number of patients a physician can see
4.3 Training fees
                                                during the learning phase).


4.4 Travel                                      Travel to other practices for site visits and travel for training.



4.5 Support contracts                           Contractual fees for support services.


0     Total Support Costs


                                                Costs associated with the initial implementation of a complete EHR, implementation of individual EHR modules, and cost of
5.0 Implementation
                                                implementing system enhancements and new releases of software.

      Development, customization and
5.1                                             These services may be performed by your staff, an outside contractor or your EHR vendor or a combination of these.
      integration of EHR software

      Initial Training of support staff and end
5.2                                             Any initial training costs not included elsewhere.
      users

                                                Fees and travel for third party consultants, if needed, to support either the implementation directly or to support the legacy systems
5.3 Consulting/system integration
                                                while your internal team is assisting with the implementation of the new application.

                                                Costs associated with modifying your facilities. These could range from drilling holes in desks for power cords to building a separate
      Facilities (e.g., storage and placement
5.4                                             server room with cooling and ventilation. The extent of facility changes will depend upon your specific EHR, practice and implementation
      of hardware, cooling and ventilation)
                                                plan.



                                                                                          Page 4 of 5
0     Total Implementation Costs


      Data Communication Costs (including
6.0                                             The inter-computer communication expenses
      fees, equipment, installation)


6.1 Internet access                             Fees for connecting to the Internet or increasing the speed of your existing connection.



6.2 Local Area Network                          Frequently new applications require additional capacity from your internal network.


                                                Some services require a private network connection to a data center or hardware and software to establish a secure connection over the
6.3 Wide Area Network / VPN
                                                internet using a virtual private network or VPN.


0     Total Communication Costs


7.0 Ongoing Operational Costs


7.1 Backup and recovery                         The costs for adding the new system to you disaster recovery plan (e.g., hot site backup for critical clinical systems).



7.2 Classroom end-user training                 Classroom training costs not shown elsewhere.



7.3 Online and internal end-user training       Online training classes or time for your existing staff to train other new or existing staff members if not shown elsewhere.

                                                Cost increases or reductions due to changes in internal staff productivity including overtime. Typically, productivity is reduced initially
      Internal staff productivity and payroll
7.4                                             and overtime may be incurred during implementation. After implementation, productivity may be improved. Typically reflected as +/-
      impact
                                                changes from baseline.
                                                Increases or reductions in net income due to implementation of the EHR. Typically, income is reduced initially during implementation.
7.5 Income impact
                                                After implementation, income may be increased. Typically reflected as +/- changes from baseline.


7.6 Local file maintenance                      Time or external services required to maintain your EHR files and database.




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