Following Big 2008 Slump, E-Health Systems Will Boom - InformationWeek

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Following Big 2008 Slump, E-Health Systems Will Boom

Fewer new clinical information systems were sold in 2008 than during the previous seven years, according to a new report. But that trend will change in a big way soon.

Fewer new clinical information systems were sold in 2008 than during the previous seven years, according to a new report. But that trend will change in a big way soon."Certainly, the economy has had a large impact, and if the stimulus bill had not been signed, it would be even more dismal," said Jason Hess, general manager of clinical research at KLAS, a Utah-based firm that studies health IT trends.

The passage in February of the American Recovery and Reinvestment Act has the federal government waving $20 billion in financial incentives at healthcare providers that deploy e-health systems.

"With ARRA, hospitals are scrambling" to select and begin deploying clinical information systems (CIS), said Hess in an interview with InformationWeek about KLAS's new report that Hess co-authored, Physicians, Nurses and EMR Adoption: Which Solutions Are CEOs Betting On?

CIS covered in KLAS' report includes e-medical records (EMR) and computerized physician order entry (CPOE) systems, for which hospitals are eligible for the government rewards if using the technology in "meaningful" ways starting in 2011.

"Next year will be a boom year, and so will the next," Hess predicts.

For the report, KLAS studied larger hospitals having more than 200 beds. There are about 1,400 of those larger hospitals in the U.S. Of those, KLAS estimates about 412 hospitals have no CIS at all or are running much older legacy CIS products. It's this group that's expected to be most active pursuing the purchase and installment of new EMR and CPOE systems, said Taylor Davis, KLAS manager of research analysis and co-author of the new report.

"ARRA is shaking up the industry," he said. Also, while the KLAS report didn't cover them, there are about 4,000 community and specialty hospitals in the U.S with fewer than 200 beds--and many of them are even further behind in CIS adoption, Davis said.

Demand for CIS from those smaller hospitals will also contribute to huge spike in CPOE and EMR adoption that'll be happening over the next few years, he said. Those hospitals that don't adopt will miss out on the government's financial incentives, and even worse, be penalized with reduced Medicare and Medicaid reimbursements starting in 2015.

"If you haven't taken the time to select your horse, you better get going," said Davis. "You need to be riding it by 2011."

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