Information systems expenditures represented more than 5% of the total budgets for healthcare facilities and networks in 1996, according to a new study to be released this week.
That figure came on the heels of an information systems budget percentage of nearly 5% in 1995, continuing evidence that healthcare is breaking out of a traditional 2% to 4% allocation of total funds to information systems, said Richard Correll, president of the College of Healthcare Information Management Executives.
The industry association for chief information officers commissioned the survey of its membership by HCIA, a Baltimore-based information services company, in 1996.
Powering the increase in budget allocation was a level of capital spending on information technology that hit almost 16% of total capital budgets in 1995 and climbed to 19% in 1996.
Of a total membership of 750, the survey polled 231 association CIOs, including 129 in charge of multiple-facility integrated delivery systems.
Nearly half the respondents hailed from organizations of 400 beds or more, but that category also encompassed small or mid-sized facilities for which decisions are being made by CIOs of integrated systems. In all, the CIOs were responsible for 380 acute-care facilities.
The survey revealed a front-burner focus on information strategy as measured by attention to strategic planning, said Steve Van Till, senior director at HCIA. Nearly half the respondents were working from plans drawn up in 1995, and 32% were following plans established in 1996.
That's an acknowledgement that organizations are reworking their strategies in response to business and technology change, he said. "Things are changing quickly enough that some are only going a year at a time," Van Till said.
Half said their information plan had a three-year time frame, and 7% were working from a one-year plan. Van Till said many of the three-year documents likely were rolling strategic plans revised each year.
Despite the evidence of spending, news of publicly traded information companies has been peppered in recent months with disappointing earnings and stock declines. Even though total spending is up, "there are a lot more mouths to feed in this industry" as new entrants invade the healthcare sector, Van Till said.
There may be more to feed them with this year, according to estimates of spending increases in the survey. A 1997 increase of 31% is projected for total capital allocated to information systems compared with totals for 1996, which already were 29% higher than 1995 budgets on average.
Meanwhile, interest is beginning to surge in the more complex and higher-ticket data warehouses and clinical data repositories. More than 50% of respondents said they either were installing, evaluating or planning to evaluate data warehouses.
That level of interest "is exciting because it is the technical foundation of clinical and financial decision support systems," said Terry Wilk, CIO of Fairview Hospital in Cleveland and chairman of CHIME's data and research committee.