Hospital IT spending to reach $4.7 billion

An estimated $4.7 billion will be spent on hospital IT applications in 2009, a number that will increase to approximately $6.8 billion in 2014, according to a new report by market research firm HIMSS Analytics of Chicago.

The fourth edition of "Essentials of the U.S. Hospital IT Market" provides a current overview and future projections of this market segment, incorporating data captured from more than 5,100 hospitals and 32,000 medical facilities in the U.S.

The revenue projections include spending from a $19 billion fund established by the American Recovery and Reinvestment Act (ARRA) as incentive payments for U.S. hospitals and ambulatory clinics to implement electronic medical records. The data provide background and guidance on how the ARRA funding will be allocated, as well as vendor market share analysis.

The report also reviews the effects of "meaningful use" on specific applications of the electronic medical record, including clinical data repository, clinical decision support, computerized provider order entry, and clinical and physician documentation.

The projections represent a compounded annual growth rate of 7.45% over the five-year period, based on analysis of the HIMSS Analytics Database, according to Mike Davis, executive vice president.

Although Davis attributes much of the increase to ARRA funding, he anticipates new investments will be on IT infrastructure, new claims transactions formats, and the transition to ICD-10-CM encoding, the new coding system updating encoding, billing, and quality and outcomes reporting.

Related Reading

Demand for HIT services grows in Europe, June 11, 2009

Obama stimulus package allocates $20 billion to healthcare IT, February 19, 2009

HIMSS survey: EMR tops healthcare IT plans, February 25, 2008

Regulatory carve-outs hope to spur HIT growth in U.S., February 28, 2007

Report: State and local healthcare IT spending to grow, August 3, 2006

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