IT Health Care Budget Black Holes
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Talk of health care reform is inescapable as the Obama administration presses its case for initiating a massive overhaul of the medical insurance and patient care delivery system that accounts for one-seventh of the U.S. economy. Health care is also a major component of the Obama economic recovery plan, through which as much as $2 billion is already circulating to modernize health care systems. All told, Obama's plans could infuse the health care system with tens of billions of dollars for electronic medical records, data security, storage, communications and collaboration systems. But who will reap the bulk of these health care reform and stimulus funds? Many solution providers, integrators, vendors and distributors are hungrily awaiting the windfall into the health care system to provide the necessary funding for their expensive new IT systems and services. Government money—through grants and direct funding—is already available in many areas, but it's not the torrent that's been promised. And when the spigot is finally opened, some question whether the money will go to the right place. While flying home from San Francisco the other day, I sat next to an executive of an international health care integrator. His remarks were quite contrary to conventional wisdom. While many solution providers and vendors are crowing about the money being spent by health care providers and hospitals, he says that most of the health care system integrators he's talking to are near broke and don't have the money to spend on next-generation systems. Spending on isolated upgrades and capacity expansion is always going to happen, but that's not a reflection of huge influx of spending. Likewise, he expressed a huge concern about who will get the tens of billions of dollars that will flow from government coffers into the health care system. His fear: government and defense contractors. Big government contractors including Lockheed Martin, Northrup Grumman, Raytheon, Boeing, McKesson and United Technologies either have or are launching health care practices in anticipation of the federal government health care spending. As this health care solution provider notes, large government integrators are best at one thing: taking the government's money and not necessarily reforming technology systems. Equally worrisome is how government health care money will get spent. This health care solution provider says most of his customers—hospitals, regional medical centers and large physician practices—don't have the money for major technology upgrades. Funding IT overhauls will require government grants and supplemental funding. If large government contractors are given responsibility for administering and distributing these funds, solution providers looking for health care work would be subject to the complexity of prime-subcontracting engagements. Granted, not all health care dollars will go to or through large government contractors and integrators. However, these contractors are large enough to tie up volumes of greenbacks. And that could definitely complicate opportunities for solution providers. |
Comments (3)
I believe that some of the HIT Stimulus Funding will go to Small Businesses. Healthcare Reform Offers National Investment Opportunity. And as such, we need to Used our Technological Strenght in HIT, to Reduced Healthcare Costs.
For years, Microsoft's Desktop Applications have Increased Productivity, Efficiency, and Costs
Savings in the Work Place.
Proper Deployment of Health Information Technology (HIT) Solutions, and Training can Increased Productiviity, Efficiency, and Costs Savings of around 20-30% of our Annual National Heallthcare Expendiitures ($2.4 Trillions).
We can start by Deploying a pure Packet-based, All Opptical/IP, Multi-Service National Transport Network Infrastructure, using Ethernet throughout the National Networks. This 21st Century National Network, will Connect all Optical Islands.
The Benefits of such National Network is that it can Serve as a Business Driver for: e-Healthcare, e-Commerce, e-Education, Energy Systems, Transportation Systems, Social Networking, Entertainment, etc.
This type of Investment is like the past Investments in the National Transportation Inter-State Highways, which Increased Productivity and our GDP.
Please See: www..gkquoquoi.blogspot.com for Summary Deployment Plan for the Nationwide Health Information Network (NHIN).
Gadema Korboi Ququoi
President & CEO
COMPULINE INTERNATIONAL, INC.
Posted by Gadema Korboi Quoquoi | October 5, 2009 1:27 PM
The source for this writer’s article is some anonymous “…..Executive of an International Health Care Integrator”. This “source” would be a major stakeholder in the discouragement of smaller integrators to build excellence in the small business medical marketplace.
The monies allocated to EMRs in the ARRA they are not targeted at Integrators, but rather to Medical Practices.
Most Medical Practices in the country are small businesses, not large institutions.
The allocation of the tens of billions of dollars the author mentions in the article has mostly been allocated. Those monies will go to Doctors who provide services.
Individual Doctors will be eligible to receive between $44,000 and $64,000 between 2011 and 2016 based on proof through reporting of “Meaningful Use” of a Certified EMR system. (Complete “Meaningful Use” standards requirements for EMRs will be delivered by HHS/HIT by December 31, 2009.)
Recommendations for “Meaningful Use” as well as “Privacy and Security Standards” for the required reporting have been submitted to the National Coordinator for Health Information Technology by the Standards Committees (The Committee is comprised of Industry Experts, not Government and Defense Contractors).
Information of the current status of “Meaningful Use Standards” can be found at:
http://healthit.hhs.gov/portal/server.pt?open=512&objID=1271&&PageID=16502&mode=2&in_hi_userid=11113&cached=true
HIT ARRA funds available to Doctors and Medical Practices provide an enormous opportunity for small to medium Integrators, VARs, MSPs and Hosting Providers.
Relationships need to be established now to these and medium medical practices and complete EMR solutions need to be designed by Integrators and VARs with MSPs, Hosting Providers and Certified EMR Vendors.
Integrators and VARs will need to begin establishing themselves as “Trusted Advisors” to the small and medium size medical practices to help guide them through the decision process of an EMR decision, with an understanding that the sales cycle in this effort will be long, but the end result upon closing will be long term.
It will be the ongoing success of EMR systems that provides success to this National Effort and Investment, and it is small and medium size Integrators and VARs who should provide the pathway to that success.
After all it is the small and medium Integrator and VAR who understand how to make their small and medium clients successful with their technology investments.
Posted by Lawrence Shields | October 5, 2009 4:13 PM
Could you explain what Defense contracts would be doing with this money?
Posted by A&D | October 22, 2009 11:29 PM