Report Finds Most HIT Budgets Continue to Climb
A new IDC Health Insights report that examines the results of the 2015–2016 Healthcare Provider Technology Spend Survey, reveals that while 40% of providers reported that IT budgets are still growing, only 25% of providers that reported growing budgets attribute growth to EHR, providing evidence that the post-EHR era is upon us as providers turn to optimizing the business for accountable care, adding analytics and care management, and away from massive enterprise EHR projects. Topics covered in the survey and new report, "Business Strategy: Trends and Opportunities in the U.S. Healthcare Provider Market — A Discussion of the 2015–2016 Healthcare Provider Technology Spend Survey Results," include enterprise spending and shifts in IT budgets and investment in key areas such as the cloud and clinical applications, including EHR, patient engagement, revenue cycle, and analytics.
The new survey specifically examines technology spending and planned technology spending by US acute care hospitals with 200+ beds. The results indicate that we are at the beginning of the post-EHR/postmeaningful use era in HIT. The hospitals responding to the survey overwhelmingly reported confidence in their ability to manage meaningful use. Hospitals were somewhat less confident in their ability to manage health care reform requirements other than meaningful use. Additional key findings of the new report include the following:
- Across all of the technologies examined in the survey, providers are taking advantage of more cloud implementations and leveraging mobile and analytics capabilities in the cloud. While 50% of software spending growth is still directed toward on-premise investments, survey respondents reported that 18% of new software spend is going into SaaS and 24% is going into projects that leverage managed hosting by a third party.
- Comfort levels with cloud are growing. Across all hospitals, 30% of the respondents said they were comfortable with cloud in 2014, while an additional 41.5% respondents said they were more comfortable with cloud in 2015 than they were in 2014. Barriers to cloud adoption, primarily comfort levels with security and compliance, are clearly coming down.
- Across all hospitals, top reasons for budget growth included analytics, patient engagement, customer relationship management, and security.
- Security strategies are maturing. Cybersecurity is one of the new growth areas in the provider IT budget, and this growth is expected to continue in 2016. Threats are top of mind, but the increased availability of resources for IT security is allowing providers to begin to implement strategies to secure data and networks. Top priorities included focusing on security in the cloud, monitoring the environment, and controlling shadow IT.
- Analytics spending continues to grow, and Big Data is here to stay. Analytics continues to be one of the fastest-growing segments of the provider IT budget in 2016 as it has been for several years. Ongoing investment in ACO, clinical, and quality will continue in 2016, but hot areas of new analytics investment reported also include provider and care team performance analytics, as well as analytics that examine referral patterns and other financial analytics areas.
According to Research Director Judy Hanover, "This report documents the movement by providers to the 3rd Platform, and across cloud, mobile, and Big Data technologies, we saw providers making significant investment in 2015, with more planned for 2016."
As providers finalize planning for 2016, the results from this study should add to the forward-looking predictions found in "IDC FutureScape: Worldwide Healthcare 2016 Predictions" to provide a benchmark on the activities of peer organizations in the industry. IDC Health Insights recommends the following key actions to consider:
- Align investment plans with enterprise strategy.
- Evaluate your planned strategy for opportunities to leverage the 3rd Platform.
- Look holistically at topics like operating cost, productivity, and efficiency for investments with ROI in these areas, which may or may not involve modifications or enhancements to the EHR.
- Increased availability of resources for IT security is allowing providers to begin to implement strategies to secure data and networks.
- Continue to grow expertise and application portfolios where gaps exist in hot new areas including provider and care team performance analytics, as well as analytics that examine referral patterns and other financial analytics areas to drive competitive advantage.
- New spending will be directed toward optimizing IT departments, right staffing, and adding resources that help make IT more efficient or bring skills needed for the 3rd Platform.
IDC Health Insights