Mobile, EHRs to Fuel 24 Percent Health Care IT Growth by 2014: Report
The health care IT industry will grow 24 percent from 2012 to 2014 and increase its spending by $40 billion through the end of 2011, according to the report U.S. Healthcare IT Market Analysis by RNCOS, a global research firm based in India.
Currently, about $80 billion a year is already spent on health care IT, the firm reports. Government pressure to adopt EHRs (electronic health records) will drive increased spending on health care IT hardware and services, RNCOS suggests.
Due to a demand for EHR applications, the health care IT software market will grow in revenue from $6.8 billion in 2010 to $8.2 billion in 2011, the firm reports. "In [the] U.S., the mandatory use of EHRs has boosted the markets for software in the health care industry," the report states.
Federal incentives awarded for meaningful use of the electronic records are leading to added pressure to adopt health care software, offered by companies such as Cerner, GE and McKesson.
Mobile health is another key reason for health care IT growth, according to the May 2011 RNCOS report. "The buzz surrounding mobile health care has steadily grown during the past two years," the report states. "There's no question that this area holds enormous potential in terms of improving patient care in the U.S."
Physicians use mobile health applications to educate patients, collect data remotely, communicate with distant workers, trace disease outbreaks and aid in diagnosis and treatment.
Of physicians in the United States, 72 percent use smartphones, according to the report. In addition more than 10,000 mobile health applications are available, with 6,000 on iTunes.
The m-health market will grow by around 22 percent from 2012 to 2014, with more than 20 percent of physicians owning iPads, according to the report.
The American Telemedicine Association recently asked the FCC for wireless airwaves dedicated to health care, though the government has yet to approve the measure, RNCOS noted.
A government push for hospitals to move from an ICD (International Classification of Diseases) 9 to the ICD-10 diagnosis code by Oct. 1, 2013, is also driving health care IT spending, according to Rich Garnick, CEO of IT services provider Anthelio. Anthelio is a competitor to Accenture, Dell Services (incorporating Perot Systems) and Xerox's ACS in the health care IT services market.
"Analysts are estimating that the demand for IT [to] work around that transformation of ICD 9 to ICD 10 is analogous to the Y2K initiative prior to Y2K," Garnick told eWEEK.
"So for any one treatment, instead of broadly defining a stomach ache, they might get down to very minute clinical details so they can track all the data and look for better outcomes," Garnick said. "Because there's a big push by the health care system from the payer's side and the government to get better analytic data on the outcomes that we're investing in, in our investments in health care."
IT hardware makes up 65 percent of the health care IT market, followed by software and services, according to the survey.
Another area that health care IT needs to invest in is interoperability of communications protocols for data, Garnick said.
The U.S. health care IT market is still fragmented since vendors operate many different types of legacy data networks. The credit card industry is an example where data interoperability works, according to Garnick.
"If you travel around North America or even around the world, a credit card company knows where [you are], who you are, what your spending patterns are and all your history instantaneously if they need to," he explained. "It's there for fraud protection and other things. That is not available in the health care system, and that's a big issue for efficiency and better care."