Hospital budgets for information technology are on the rebound after a hard knock from the recession, according to a new health IT market report from HIMSS Analytics, the market-research arm of the Chicago-based Healthcare Information and Management Systems Society.
The report, the sixth edition of "Essentials of the U.S. Hospital IT Market," is based on HIMSS Analytics database information on 5,200 hospitals and 32,000 medical facilities in the U.S., including 24,000 ambulatory-care sites.
"While 2009 was a tough year economically, 2010 has proven to be a period of economic recovery," according to the report's authors. "Many hospitals are making capital investments to position themselves to qualify for meaningful-use incentives. As such, hospitals' capital spending for IT application solutions in 2011 is projected to constitute 46.5% to 48.3% of their total IT capital budgets; this is up approximately 2% from 2009.”
The American Recovery and Reinvestment Act of 2009, with its estimated $27 billion in funding for health IT acquisition and "meaningful use," is providing some of the saving grace from the recession that "has significantly affected a normally recession-resistant medical industry," according to the report. "We believe that the prospect of receiving (stimulus-law) funding restimulated IT budgets to overcome the recession's lag effects on hospital cash availability."
The bond market, however, "still remains a challenge to hospitals with weak balance sheets and precarious cash flows," according to the report's authors. "Several senior healthcare IT executives have informed HIMSS Analytics that bond analysts are now asking questions about achieving meaningful use, and about hospitals' HIMSS Analytics EMRAM scores, during the due-diligence phase of bond ratings and placements. Hospitals that have not been investing, and thus have low EMRAM scores, may have a more costly debt service."
Sections of the report, including the executive summary, are available online without charge.
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