Calculating ROI is a method of determining an investment's efficiency. ROI is calculated by dividing a program's net gain, or benefits, by total costs incurred. Determining both costs and benefits within healthcare is a complex undertaking, and calculations illustrating ROI of health IT within the realm of public insurance are rare.

Since the formation of the Children's Health Initiatives (CHI) by several counties in California, programs aimed at public insurance enrollment and retention have saved an estimated $6.7 million in hospital costs. These savings are presented and described in an article by Cousineau, et al. entitled, The Impact of Healthy Kids on Access, Health Status, and Costs (PDF - 208KB). While not providing a specific ROI analysis, the Center for Community Health Studies article, Children's Health Initiatives Have Helped Prevent Over 1,000 Unnecessary Child Hospitalizations Annually (PDF - 176KB), illustrates California experiencing cost savings since implementing programs designed to further Medicaid and CHIP enrollment and retention. Florida has estimated savings of $83 million through its online application system for the ACCESS Florida program. Utah's new data brokering system (eFind), which helps eligibility workers automate searches for eligibility information, recouped its costs for building the system within the first year of operation. More information detailing the Utah and Florida health IT efforts as well as information on other technology solutions currently employed by the States can be found in The Kaiser Commission on Medicaid and the Uninsured report Harnessing Technology to Improve Medicaid and SCHIP Enrollment and Retention Practices (PDF - 604KB).

The resources below outline the breadth of complexities involved in the identification of benefits and costs (i.e., both fiscal and health-related) for a health IT ROI analysis:

• Report: Evidence on the Costs and Benefits of Health Information Technology (PDF - 1.2MB)
• Presentation: HIT Return on Investment: Evaluating Progress in a Sea of Change