Healthcare Technology Featured Article

February 01, 2016

IT Budgets See Big Growth in Healthcare

If it seems like there are more and more requests for new tools from the information technology (IT) department, it's with good reason. There are a lot of new tools out there to pick up, and many represent new ways of doing business, new features to help improve operations, or even potential cost savings. While it's impossible to try every new system, budgets for IT are often on the rise. And one sector that's seeing massive gain in IT budgets is healthcare.

Within the healthcare field, according to IDC Health Insights, 40 percent of providers report that IT budgets are still on the rise. That comes with a bit of a caveat, though, as just 25 percent of that 40 percent attribute that growth to electronic health records (EHR) growth. That's leading some to call this the “post-EHR era,” and healthcare is now looking to IT to provide other benefits, like analytics tools, care management, and other moves that help make the business the best it can be.

The study found that progressively more of surveyed organizations were turning to cloud implementations, with a particular focus on mobile service and analytics capabilities. Around half of software spending growth is being put toward on-premises investment, but that means half isn't. Eighteen percent of new software spending is being directed toward software-as-a-service (SaaS), while 24 percent is going into software that's hosted by third parties. This represents an increasing comfort with cloud-based systems, as 30 percent considered themselves comfortable with cloud in 2014 while 41.5 percent noted being more comfortable in 2015 than in 2014.

Analytics were a huge reason for budget growth—considered one of the fastest-growing segments of IT budgets—followed by patient engagement systems, customer relationship management (CRM) tools and security systems. Some of the standards will be in place for a while, like quality analytics, but some new analytics tools are also stepping in like care team and provider performance analytics, as well as financial analytics tools.

In the end, the EHR migration seems mostly finished, and now, healthcare providers are looking beyond the must-have put in place by regulators to see what healthcare providers can do to save money and produce a better operation. These are the two key points of any for-profit business; saving money reduces expenses, which improves profitability if revenue stays static. Improved service increases the customer base, which brings in more revenue and improves profitability if expenses don't rise at the same rate. So working both sides of the profitability equation at once means greater overall profit, and a better organization overall.

IT budget demands aren't likely to fall; growing cyberthreats are emerging from several corridors, and the opportunities presented by new tools are hard to pass up. The healthcare market will need to continue its IT expansion for some time to come, and that means opportunity for all the IT tool-makers out there.

Edited by Kyle Piscioniere

FREE eNewsletter

Click here to receive your targeted Healthcare Technology Community eNewsletter.
[Subscribe Now]