State and Local Governments to Increase Health IT Spending

U.S. state and local government health organizations will increase their investments in health IT systems and services from $7.6 billion in 2009 to $9.6 billion by 2014, a compound annual growth rate of 4.6 percent during the forecast period, according to a report by INPUT.

Health IT Transformation: FY2009-FY2014 State and Local Market Forecast said that in particular, current financial burden imposed on the federal government by health care costs is not sustainable, and this will drive improvements in efficiency through the use of cost-effective and innovative health IT.

Trends to watch for include:

funding of $1 billion in stimulus money for community-based strategies and state-level infection reduction will spur additional investments to respond to outbreaks of influenza pandemics and food-borne illnesses.
funding of $2.5 billion for community-based health care centers will drive investments in facilities security modernization, electronic medical records (EMRs) and the workforce.
The national health IT effort—combined with increased enrollment as unemployment spikes—will push states to invest in solutions that reduce fraud and abuse.

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