Stimulus Bill Will Stimulate Health IT Adoption, Jobs

The $21 billion for health IT programs in the U.S. economic stimulus bill will create career opportunities and fuel educational programs for professionals to acquire a mix of technology and clinical expertise.
The economic stimulus bill -- which includes approximately $21 billion for health IT programs and is expected to be signed into law by President Obama within days -- could end up making real a goal set out five years ago by President Bush: for most Americans to have an e-health record by 2014.

The reality of Bush's goal was looking pretty dim, since the percentage of U.S. doctor offices adopting fully functional e-medical record and other related systems has been inching up very slowly and is still estimated to be somewhere in the low single digits. Meanwhile, the advanced use of e-medical records, computerized physician order-entry, and other important health IT systems at U.S. hospitals is estimated at less than 20%.

What's been the biggest hurdle? Money.

That's because the purchase, implementation, and support of health IT systems is expensive, time consuming, and difficult. And while those systems can streamline workflows, reduce paper, eliminate redundancies, and prevent medical errors, the bulk of the financial reward on those technologies isn’t realized by the already cash-strapped doctors and hospitals. Rather, the greater cost savings are achieved by insurance companies and other payers -- most notably the federal and state governments through Medicare and Medicaid programs.

The money allotted by the bill "will make a huge difference," says Erica Drazen, managing partner, emerging practices of CSC Global Healthcare Sector. While the bill does provide for about $3 billion in grants, loans, and other programs to help health care providers purchase health IT systems, the bulk of funding -- about $18 billion -- is for financial rewards for improving patient care through the use of the technology.

"Buying the systems and putting them in doesn't achieve what we want to do," in terms of reducing billions of dollars annually in health care costs and improving patient outcomes long term as a nation, says Drazen. The biggest bang for health care providers in this bill will come from additional Medicare and Medicaid payments they'll receive by meeting patient quality of care and other milestones through effectively using health IT, she says.

In the first year of the incentives, hospitals can receive up to $1.5 million for effectively using these systems, while doctor practices can eventually earn around $40,000. "That's a lot for small doctor offices, even more meaningful than the $1.5 million for large hospitals" Drazen says.

"Talk is cheap. You need to put your money where your mouth is, and this bill does that," says Sen. Sheldon Whitehouse, who spearheaded provisions of the bill related to establishing new resource centers to assist doctors in implementing e-medical record systems. Those resource centers are a small but important part of the help designated in the bill for health care organizations, and will be modeled on a resource center program used in U.S. agriculture to help farmers, for instance, get better yields of their crops, he says.

The new health IT financial rewards won't start kicking in till 2011, giving hospitals and medical offices time to begin implementing their systems if they haven't already done so, says Drazen.

In the meantime, the demand for health IT products -- and especially the expertise to implement these systems -- will grow, creating new jobs, a key part of the overall stimulus package, says Whitehouse.

The Business Roundtable estimates that a $10 billion investment in health IT as part of the stimulus plan could create 200,000 new jobs, according to a letter the CEO association's president, John Castellani, sent to members of the U.S. Senate on Feb. 4.

"These jobs would be in high-paying industries such as computer hardware manufacturing, software, and information technology services, as well as jobs that would be created from spending on producing hardware, software, and information technology," Castellani said in his letter.

CSC's Drazen predicts the health IT stimulus program will create new career opportunities and fuel new educational programs for professionals to acquire a mix of technology and clinical expertise. "They'll be much more demand than supply of these skilled workers," she says.

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