Health care reform will be boon for IT industry, report says

Pieces of the federal health care reform legislation could have big implications for information technology investments at the state and local level, according to a new report Thursday. Major IT assets will be needed to manage keystones of the legislation the INPUT report said, specifically, health insurance exchanges and other web-based portals.

Market research firm INPUT suggests federal and state-level IT investments will near $7 billion to support pieces of the newly enacted health care reform legislation. “Based on the numerous requirements for reform, IT investments are likely to occur within the first five years of implementation,” said Senior Analyst and report author Angie Petty in a statement.

The report outlines four categories of underlying requirements where technology will play a vital role.

  • Health IT – the Patient Protection and Affordable Care Act advances measures in the Recovery Act and elsewhere promoting the use of electronic health records and clinical decision support systems.
  • Medical Technology – like Health IT, diagnostic equipment and imaging hardware/software were spurred by the Recovery Act and will continue to be so with the passage of health care reform.
  • Health Care Business Processing – with an influx of new Medicaid and Medicare recipients, the federal government (as well as state governments) will have to focus on new billing systems, case management and document management technology
  • IT for Health Care Reform Management – IT infrastructure investments for web-based insurance exchanges and other new organizations will make up a significant part of states’ investments.

    But health and human services at the federal and state level will not be the only spenders, the report concludes. The Internal Revenue Service will have to upgrade many of its systems and processes to verify who has and who does not have insurance come tax time, Ms. Petty said.

    “We estimate that the Internal Revenue Service will be required to spend as much as $2.5 billion in IT related to eligibility determination, documentation, and verification processes for premium and cost-sharing subsidies.”

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