That didn’t take long.

A mere four days after news broke that the Internal Revenue Service (IRS) had improperly targeted conservative political groups for scrutiny, GOP Sen. Dean Heller (NV) is threatening to introduce legislation that would “deny the IRS funds to hire new agents to implement Obamacare.” The bill would effectively make it impossible for the agency to provide millions of Americans with federal subsidies to buy the very health coverage they are required to have under the law.

Heller argues that this extreme measure may be necessary in light of the unfolding IRS scandal, echoing a growing trope among conservative politicians and right-wing commentators. Since last Friday, big-name conservatives including House Oversight Committee Chair Rep. Darrell Issa (R-CA), former presidential contender Newt Gingrich, former vice presidential candidate Sarah Palin, and various right-wing media outlets have questioned whether or not the IRS can be trusted to implement Obamacare. The implication is that if the IRS singles out conservative political groups, what’s to stop them from snooping through Americans’ private health care information or imposing fines on companies they don’t like?

This is a reduction to the absurd. The IRS has been collecting health care taxes and compliance information from employers for decades. In fact, it has to, seeing as most Americans receive their insurance through their employer and the employer health insurance tax credit is the single largest tax credit in the federal budget. That system seems to have worked without gross invasions of medical privacy since the the 1950s, and there’s no reason to assume anything will change in 2014.

Furthermore, officials with the Department of Health and Human Services have actually spoken out about the importance of protecting Americans’ medical data, and the Obama Administration has taken action to ensure it. The Health Information Technology for Economic and Clinical Health (HITECH) Act widens existing privacy and data-security protections on patients’ protected health information as more of their health records are digitized. The 2009 stimulus bill also included updates to HIPAA rules that limit “the use of patient-identifiable medical data for marketing.”

The IRS requires information from individuals and businesses that will help them determine whether Americans have insurance, and how much help they need from the government to be able to buy it. Some critics have latched onto the fact that the IRS will have access to more household income data than before when making those determinations, and that it can share this information with the statewide Obamacare marketplaces and government health agencies. But it would be impossible to implement the law without at least some data-sharing — and without it, many Americans could not receive the benefits they are due. Legislative threats such as Heller’s might make for good politics — but in reality, all it would do is prevent the 26 million Americans expected to gain insurance through the Obamacare marketplaces from receiving the tax credits that would allow them to afford it.

According to a new Johns Hopkins University School of Medicine study, doctors who know the cost of the medical tests and procedures that they perform tend to choose to do fewer of them then those who don’t. That ends up sparing patients from unnecessary testing and preventing Medicare from paying unnecessary reimbursements.

The study involved observing two different groups of doctors and lab technicians at Johns Hopkins Hospital over two separate time periods, while giving them different amounts of information about the Medicare fee associated with the procedures they were ordering:

In the study, physicians and others who ordered lab tests through the computerized order entry system at the Johns Hopkins Hospital were tracked over a six-month period in late 2008 and early 2009 and then again for another six months in late 2009 and early 2010 on how they ordered a selected group of 61 lab tests. Roughly half were chosen from the most frequent tests ordered at the hospital, and the other half, the most expensive. [...]

[Researchers] found that, in the test group, when prices weren’t made available, the providers ordered 3.7 tests per patient day, but later, when the prices were linked, the number of tests per patient day fell to 3.4, a drop of nearly 8.6%.

In contrast, the number of tests in the control group, those without pricing in both test periods, rose by 5.1%.

Test costs followed a similar path. For the test group with prices, the cost per patient day fell $3.79, for a drop of 9.6%. Meanwhile, in the control group, charges per patient day rose by $0.52 per patient day, or by 2.9%.

The results are encouraging from both a public health and a financial perspective, since unnecessary testing and procedures do nothing to improve patient care — and in some instances, can even make it worse — and lends to America’s record public and private health care spending.

But even more interesting is the study’s implications for physician medical culture and Medicare fraud. The Justice Department makes much of its settlement money from doctors who cheat Medicare through practices such as “self-referrals” for unnecessary testing and “upcoding” the cost of their Medicare patients’ services in order to return a profit. There have been some early rumblings in health care reform circles that Obamacare’s provision requiring providers to use electronic health records (EHRs) could actually lead to even more fraud by offering physicians an easier way to cheat the system. However, the Johns Hopkins study suggests that most doctors will actually make more prudential decisions when armed with exact information, so if EHRs are linked with exact Medicare fee data, it could actually make care more efficient, safe, and cost less to entitlements like Medicare.

On Monday, the New York Times reported on the controversy surrounding Intuitive Surgical Inc.’s “daVinci” robotic surgery system — a product that allows doctors to “conduct” surgeries remotely on a console while robotic arms scale and translate their movements onto the actual patient. While high-tech systems like this are supposed to make procedures safer and more efficient, the daVinci lawsuit — which centers on a patient who eventually died from complications arising from the system’s use — reveals that a combination of factors, such as inadequate product testing and aggressive marketing strategies driven by profits, often undermine that goal.

That’s a frustrating reality for health care reform advocates on the lookout for effective methods of cutting national health expenditures while improving patient care. Although innovation in health care technology had undoubtedly improved lives and made care more efficient in the aggregate, as demonstrated through breakthroughs like vaccines and birth control, it has also accounted for at least half of the increase in health care spending in the last 70 years. While that may sound counter-intuitive at first, a quick dive into America’s health care culture shows why it’s not — and why innovations like “robot doctors” aren’t actually lowering health care costs:

1. It’s almost impossible to tell how much various health care technologies actually cost.

One of the most persistent problems in the American medical industry is rampant health care price opacity. Time Magazine’s recent investigative look into Americans’ sky-high medical bills revealed what many already suspected — that the prices of various medical products and services are essentially arbitrary, fluctuating wildly from one hospital chain to another and even more wildly between different geographic regions.

Since there isn’t an easily-accessible national database of medical devices and their prices, manufacturers can pitch their products at varying rates to hospitals and jack up prices with relative impunity. Those inflated costs are then passed on to consumers by providers looking to recoup their money — and since patients tend to trust their doctors and not know much about the intricacies of health care device markets, they don’t ask too many questions when they’re left to pick up an enormous, generally non-itemized tab at the end of a hospital stay that gives them no information about why they’re being charged what they are. Thus, price gouging and a general lack of perfect information in health care allows expensive consumption to continue unchecked.

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The quest to improve patient care, maximize medical efficiency, and curb wasteful spending by digitizing Americans’ patient records, insurers’ claims, and providers’ treatment requests just gained a powerful new ally: “Watson,” IBM’s revolutionary data-mining supercomputer that made national waves when it defeated reigning Jeopardy! champion Ken Jennings at his own game.

American Medical News reports that health insurance giant WellPoint has struck up a deal with IBM and Memorial Sloan-Kettering Cancer Center in New York to use the supercomputer — which has spent its post-Jeopardy days amassing and “learning” massive amounts of data about the American health care, insurance, and public health industries — for two pioneer programs to automatically process, review, and pre-authorize medical claims and treatment requests, as well as a third program dubbed “Interactive Care Insights for Oncology” that will “identify individualized treatment options for cancer patients, starting with lung cancer” in order to advise oncologists on the latest and most effective treatment regimens by incorporating up-to-the minute longitudinal medical studies and cancer data into its suggestions.

In an email to ThinkProgress, Cindy Wakefield, a Regional Director for Public Relations at WellPoint, pointed out that the new technology has the potential to have a big impact on the health care industry. “We believe the IBM Watson technology can improve the efficiency and quality of treatment, potentially eliminating unnecessary testing, enhancing the consistency of actions, and accelerating the time to treatment via expedited decision-making processing,” Wakefield explained. “We are continuing to train Watson, and we are teaching Watson by ‘feeding’ it information such as our medical policies and clinical guidelines.”

Using Watson’s technology to automate claims processes could be a potent catalyst for a more efficient American health care industry — which is often bogged down by poor inter-provider communication, incomplete and non-centralized data, and archaic paper records. The supercomputer could also advise providers on the most efficient and appropriate use of treatments based on each individual medical claim, patients’ specific insurance benefits, and patients’ medical histories by analyzing health care data from across the country.

Interestingly, if Watson concludes that a physician or provider’s treatment request is not the most effective one based on a patient’s history and medical benefits, the computer can register its disagreement — but as Wakefield explained to ThinkProgress, it cannot override the provider’s decision or deny treatment requests. Instead, a human nurse would have to review Watson’s alternative suggestion, and then make a judgment call along with the provider on whether or not to comply with it.

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Say goodbye to the doctor’s office, and hello to your personal computer. According to a new report released by the Commonwealth Fund, “telehealth” — programs in which doctors and nurses use electronic medical data to remotely monitor and check in with their patients — has led to significant reductions in hospital re-admissions and bed days among early adopters such as the U.S. Department of Veterans Affairs (VA).

The study’s authors emphasized that effective telehealth programs “take time” to implement, citing the training needed to familiarize care providers with the new technology. But by improving patient monitoring, telehealth has the potential to keep Americans healthier by making sure they’re complying with their treatment regimens:

Followers also are counseled to be patient. “Successful programs can take time to scale successfully,” the authors said. “It takes time to integrate technology into care delivery and allow staff to adapt.” The VA’s Care Coordination/Home Telehealth program targeting chronically ill veterans, for example, was launched in 2003. Now, with 70,000 veterans receiving home telehealth care, the program boasts patient satisfaction levels greater than 85%.

In a data sample from 2004 through 2007, the VA reported reductions in bed days of care across all eight targeted chronic conditions, ranging from a 20% drop for the nearly 9,000 enrolled diabetes patients to a 56% decrease for the nearly 340 patients then receiving home health monitoring for depression, and a 45% drop for nearly 140 patients with post-traumatic stress disorder.

Partners [HealthCare] has had 1,200 patients enrolled thus far in its Connected Cardiac Care Program since its launch as a pilot study in 2006. It has “consistently experienced an approximate 50% reduction in health failure-related readmission rates for enrolled patients,” according to the Commonwealth reporters, with an estimated savings in utilization of about $10 million.

In recent months, an increasing number of hospitals and government institutions have turned to technology in an effort to reduce health costs while improving patient care. Minnesota recently established an online “bulletin board” tracking the available flu shots in the state; studies have shown that telemedical procedures for women taking abortion-inducing medication are just as effective as having a doctor physically present; and a large part of the way that Obamacare seeks to reduce national health expenditures is through the institutionalization of electronic medical records.

But telehealth procedures targeted towards patient monitoring hold particular promise for improving patients’ health by curbing unnecessary hospitalizations — particularly for elderly Americans. That’s because studies have shown that a large portion of excessive medical spending stems from patients taking their medications incorrectly or not following their treatment regimens. By allowing health workers to have up-to-the minute access to their patients, telehealth could go a long way towards reversing that trend.

Providing a glimpse into the future of medical tech innovation, Minnesota’s Department of Health has launched a new online portal aiming to help flu vaccine-strapped health clinics across the state find the closest available immunizations to restock their shelves, the Minneapolis Star Tribune reports.

Although the 2013 flu epidemic has been plateauing in recent weeks, the U.S. still finds itself in the midst of the worst influenza outbreak in years. Minnesota has been hit particularly hard in recent weeks, prompting clinics across the state, as well as the Department of Health, to seek out available shots to meet with growing demand — with the help of a little technology:

The Health Department has worked with health care providers experiencing vaccine shortages before, but the exchange marks the first time it has launched an online tool to direct distribution of supplies. The department doesn’t actually redistribute vaccines, which are privately purchased, but instead allows clinics statewide to coordinate among themselves to meet patient demand.

But the publicly viewable online site allows health care providers to shift vaccine supplies where they’re most needed, whether they happen to be buyers or sellers… The exchange is essentially a Web bulletin board: Representatives of health care providers can log in without an account, post their needs, share their contact information and reply to other topic threads. [...]

“I think it is a great tool, but currently is being underutilized,” said Michelle Hanrahan, a wellness coordinator at Wellness Partners, which had already received a response seeking to purchase its extra vaccine.

Minnesota’s web-based solution to the dearth of vaccinations embodies what health care reform advocates hope that Obamacare will force health care providers across the country to do — make information easily accessible and simple to use in an effort to improve patient care and lower health costs.

Other institutions have begun to take similar tech-based approaches to public health problems. For instance, pharmacy giant Walgreens recently announced that it would try to coordinate more with physician groups and health care providers — largely assisted by electronic databases that make it easier to share medical information — in order to provide Americans with an easily-accessible and up-to-date health center. The National Football Association (NFL) also included improved electronic monitoring and sharing of players’ medical inormation as an integral part of its most recent collective bargaining deal with employees.

When it comes to electronic health records, “the switch to cloud is inevitable.” That’s according to Joy Pritts, Chief Privacy Officer at the Office of the National Coordinator for Health IT in the Obama administration, who spoke at a “Health Care, the Cloud, and Privacy” panel hosted by the Washington, D.C.-based advocacy group, Patient Privacy Rights.

Electronic health records are exactly what they sound like: A collection of health information in digital format that can include a wide range of data, from intimate details of your medical history and test results to demographic data to your billing information. Digital records are superior to physical ones because they can be transferred quickly when patients switch providers, help doctors get a complete picture of patient health, eliminate the need for redundant testing, and provide new opportunities for analyzing treatments for efficiency and effectiveness.

They are also supposed to be a cost saver. Some estimates have put the potential cost savings for switching over to electronic records as high as $81 billion annually, although the real world implementation hasn’t come close to hitting that target. Cloud storage and computing are part of this equation due to their potential to help make the transition to electronic health records more cost effective and unleash the analytics power of big data on health care information.

But while storing medical records digitally on the cloud may offer great promise for increasing the efficiency of the health care system, it is not without its challenges. Data security and privacy of health information are major obstacles where policy has not yet caught up with practice.

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What do you get when you combine the tech industry with the health care industry? One answer is “mHealth,” which the U.S. Department of Health and Human Services defines as “the use of mobile and wireless devices to improve health outcomes, healthcare services, and health research.”

Mashable estimates that there are about 40,000 mobile health apps currently available for tablets and smartphones — comprised of a wide range of apps that can help patients access their health records electronically, log exercise time, monitor blood pressure levels, track pregnancies, and check nearby pollen levels, among other things. By some estimates, the number of 2012 downloads for mobile health apps will reach around 247 million by the end of this year, nearly double the figure from last year.

The health care education portal Allied Health World created an infographic to communicate some of the impact that the rise of mHealth has had on health care consumers, including improved access to medical health information and significant savings on health care services for some segments of the U.S. population:

In fact, as a growing number of Americans consumers and businesses capitalize on mHealth, the Food and Drug Administration is paving the way for the safe and practical implementation of mobile technology in the health care sector. Last year, the FDA released guidelines for mobile health apps to help ensure that emerging health technologies are providing consumers with accurate information before they hit the market. The FDA’s website has also now includes an mHealth page under its Medical Devices section, noting that the agency “encourages further development of mobile medical apps that improve health care and provide consumers and health care professionals with valuable health information very quickly.”

Health care reform advocates argue that encouraging providers to use electronic health records would reduce medical errors, lower administrative costs and improve patient care, but the transition could also lead doctors and hospitals to easily prescribe unnecessary care and bill more for services, increasing costs for Medicare and private insurers. From the New York Times:

Over all, hospitals that received government incentives to adopt electronic records showed a 47 percent rise in Medicare payments at higher levels from 2006 to 2010, the latest year for which data are available, compared with a 32 percent rise in hospitals that have not received any government incentives, according to the analysis by The Times.

The new health IT systems will allow providers “to better document the care they provide, justifying the higher payments they are receiving” and the Department of Health and Human Services tells the Times that the government “has strong protections in place to prevent fraud and abuse of this technology that we’re improving all the time.”

Moreover, the delivery reforms included in the Affordable Care Act, which are designed to transform the current fee-for-service system of rewarding volume and intensity of services into one that prioritizes quality and efficiency, may help discourage over billing. Offering providers a fixed payment that covers all services for a specific medical condition, for instance, or a global payment that is based on a global budget for a population under an Accountable Care Organization (ACO) could also slow costs and eliminate over treatment.

Ultimately, real world experiences and a multitude of research has concluded that health IT is essential to coordinating care and enabling doctors to access vital information in real time. As the Congressional Budget Office has concluded, the federal government will save $7 billion by 2014 as a result of health IT, which providers will benefit from $17 billion in savings.

Kaiser Health News is reporting that hospitals aren’t very happy with the final “meaningful use” regulations released yesterday, even though HHS loosened some of the requirements from the draft version. The federal government is providing “$27 billion over the next 10 years to reward doctors and hospitals for installing electronic health systems,” but to receive the incentive payments, providers will have to show that they are making “meaningful use” of the technology. In the final regulation, “hospitals will have to meet 14 objectives, and at least five more goals, instead of being required to meet 23 objectives” and will be required to prescribe a smaller percentage of prescriptions electronically.

The Federation of American Hospitals, which represents for-profit hospitals, issued a statement in support of the new rules, but the American Hospital Association isn’t buying it:

Hospitals will have some additional flexibility in choosing which measures to use to qualify as “meaningful users” of electronic health records under a final rule issued today by the Centers for Medicare & Medicaid Services. At the same time, the AHA is concerned that the requirements may still be out of reach for many of America’s hospitals and more analysis is needed to determine the overall impact on hospitals. “Unfortunately, CMS continues to place some barriers in the way of achieving widespread IT adoption by our nation’s hospitals and physicians,” said AHA President and CEO Rich Umbdenstock.….However, AHA is concerned that individual hospitals in multi-campus settings continue to be excluded from the incentive payments, and that the rule requires hospitals to immediately use Computerized Provider Order Entry, “which can be complicated, costly to implement, and takes time to do right,” Umbdenstock said.

HHS issued the new regulations following extensive consultation with the provider groups and the final rules reflect their concerns. The AHA is upset, but I suspect the if everyone simply accepted the regulations, they would be fairly weak and meaningless. We’ll need to start somewhere if we’re to move to a interoperable standard and if hospitals are to begin reducing costs by 1.5 percentage points each year as they and other health care interest groups promised during the health care reform debate.