Storing patient medical records electronically and new regulations from governments will contribute to spending.
Posted Dec 22, 2005
North American healthcare providers' IT spending will total $39.5 billion by 2008, according to a new Datamonitor report. "Technology Opportunities in the North American Healthcare Market, 2005 to 2010," found that these investments will be driven largely by the purchase of electronic medical record (EMR) adoption and pressure by national and regional governments to improve current systems.
"Like healthcare in other regions of the world, the healthcare industry in North America is undergoing a period of change,"says Jocelyn Young, research director at Datamonitor and author of the report. "The healthcare and pharmaceutical industry as a whole is undergoing a shift that impacts the way that healthcare is delivered, financed, and managed."
This aggressive investment in IT by the healthcare industry follows on the heels of tepid IT investment over the past decade. The reason for this spending increase is that the industry traditionally has ignored IT technology in favor of medical technology, according to the report, but the increasing role that national and regional governments are playing, particularly with laws like HIPAA, is changing the industry's buying habits. In addition, technology like EMR, or software used to electronically record and store patient information, thus replacing paper, will enable healthcare providers to improve cost control and patient care, as well as boost employee productivity and overall provider competitiveness.
The Canadian healthcare IT industry will experience an 8.1 percent five-year CAGR through 2010, according to Young. Much of this investment will center on EMR systems, medication and laboratory information systems, and digital imaging. In addition, health surveillance systems will be critical to managing localized and national public health problems, according to the report. In the U.S. market, physicians' offices will show strong growth over the forecast period, driven by projects funded by the federal government. Additional drivers include health plans and associations that are increasingly rewarding physicians who adopt technology to improve medical practice standards and performance. Last, North American healthcare providers will increasingly rely on BPO to gain advice, education, and expertise in the implementation and operation of new technology.
"This industry is working to build an increasingly compelling case for the quantifiable value of IT in healthcare," Young says. "We're going to continue to see strong growth in this industry vertical for some time to come."
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