Hospitals To Spend $14B on Health IT Through 2014, HIMSS Says

The Healthcare Information and Management Systems Society predicts that hospitals will spend $14.4 billion on IT systems through 2014 but that capital spending will remain relatively flat until funding from the federal stimulus package kicks in, Government Health IT reports.

On Tuesday, HIMSS officials discussed their hospital health IT spending projections, which are based on the group’s tracking of more than 5,000 U.S. hospitals.

According to HIMSS, spending on systems — such as electronic health records, computerized physician order entry and clinical decision support — is expected to reach $1.7 billion this year. Hospitals’ IT spending later will increase because of the effect of the federal stimulus package, HIMSS predicts.

Funding Constraints

Mike Davis, executive vice president of HIMSS Analytics, said that hospitals face funding challenges in the near term.

He said that banks are not lending to the hospitals he has talked to, including those that have submitted business plans based on the federal stimulus package. He added that hospital endowment funds have lost 20% to 30% of their value in some cases.

Davis said he hopes to see signs of improvement by the end of the year.

Davis also noted that some IT vendors have begun to offer financial assistance to hospitals. For example, GE announced earlier this week that it plans to offer interest-free loans to hospitals and health care providers, he said.

Conflicting Priorities

Davis said that as funding becomes more available, hospitals will face conflicting investment priorities.

He said that as hospitals continue to pursue EHR projects, they face a January 2012 compliance deadline for HIPAA 5101 transactions and an October 2013 deadline for ICD-10 coding compliance (Moore, Government Health IT, 6/17).

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-Health-IT-Through-2014-HIMSS-Says.aspx