State Health IT Job Market Looks Healthy - InformationWeek
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State Health IT Job Market Looks Healthy

Medicaid management, interoperability, and health insurance exchanges are top vendor opportunities, says report.

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Various healthcare reform efforts have created "seemingly endless" health IT job and contracting opportunities with state and local governments, according to a new report.

"The energy directed from these initiatives will result in substantial changes to states' technologies and business processes over the next 3-5 years," said the report, "Top Opportunities for FY 2012--Health Care," published by Input, a research organization serving the public-sector market that's part of software firm Deltek.

The document details five current, major opportunities in each of three technology categories. It does not, however, discuss the overall size of the market in terms of jobs.

Much of the contracting needs stem from the fact that states have not received adequate guidance from the federal government on how to design information systems to implement certain aspects of health reform, according to the report. "For that, vendor support will be needed in reviewing and restructuring business operations to allow future systems to interface and meet functional and information requirements," the report said.

Deltek listed the top opportunities as: health information exchanges, health insurance exchanges, and Medicaid management information systems (MMIS), based both on the estimated dollar amount of expenditures and on vendor traffic to Deltek's proprietary database of more than 1.5 million nonfederal government contracts. However, the lists are not meant to be exhaustive. "There are many, many more opportunities that we are tracking," Deltek research analyst Kate Tussey told InformationWeek Healthcare.

In terms of dollar value, the Texas Health and Human Services Commission and the Florida Agency for Health Care Administration have the greatest needs, with each seeking approximately $300 million in help with MMIS, according to Deltek. Surprisingly, tiny Delaware places third in the MMIS category, with $160 million in opportunities available.

In particular, Texas is looking for technology and management help in meeting the national October 2013 deadline for being able to process claims coded in ICD-10. Florida is looking to replace its current MMIS with something that providers and enrollees can access over the Web, while Delaware just needs a new vendor to maintain its existing system.

Smaller vendors should be able to get in on the action, according to Tussey, as Deltek reported that many states are looking to part from their old methods of single-contract procurement. "Huge MMIS contracts are now getting broken up and bid in stages," Tussey said. "A lot of funding calls for better integration," she added.

"In the short term, vendors should stay on top of trends and various requirements trickling down from the federal government. Attention should also be placed on the flow of money from the federal government and states' own investments to determine new developments. Vendors can assist states through these health care reform challenges by rethinking ways to conduct their business processes and build cost-effective solutions," the report advised.

"In the long term, vendors should keep in mind opportunities that could arise from mature systems, such as with information exchanges and MMIS, since entry to these segments are not entirely closed. There will continue to be opportunities for vendors to work with states just coming out of their planning stages, or to advise operational states with sustainability and/or modernization efforts."

With an estimated $10 million in contracts available, Delaware also places in the top five among states building health insurance exchanges, a key element of the 2010 Patient Protection and Affordable Care Act. The exchanges will be online marketplaces where previously uninsured people will be able to shop for health insurance.

Among the five insurance exchange projects listed, California has the largest, worth $45 million. Illinois is second, offering about $25 million in contracting opportunities.

Massachusetts, long a leader in health IT, is offering $45 million worth of contracts for health information exchange, via its Massachusetts Technology Collaborative agency. Arizona places second on that list, at $30 million.

Find out how health IT leaders are dealing with the industry's pain points, from allowing unfettered patient data access to sharing electronic records. Also in the new, all-digital issue of InformationWeek Healthcare: There needs to be better e-communication between technologists and clinicians. Download the issue now. (Free registration required.)

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