Hospitals might be cutting back on spending, but they're still shelling out for electronic health records, according to a recent HealthLeaders Media Intelligence Report on capital spending. Among survey respondents, 39% said EMR systems will receive the majority of capital funds in the coming year. Another 27% say most of their capital funds will go to clinical technology this year.
An investment in health information technology is an investment in growth, Greg Pagliuzza, the vice president and CFO of Trinity Regional Health System tells senior finance editor Karen Minich-Pourshadi in the report.
"A new facility does have a positive result with volumes coming back … but at the end of the day we have to ask, 'What is the ROI of building versus renovating?' " he says. "In terms of technology, I think we have to redefine how we look at growth in terms of delivery of care. It's not necessarily just about building or getting another CT scanner. We grow by drawing in a population that you didn't have previously … that's why EMR investment is growth, because you can take that patient and embed them in the system."
Beyond that, of course, are the financial rewards from the federal government for those healthcare organizations that meet meaningful use requirements. "When you look at the dollars that could be left on the table, it's a compelling reason to get this done," says Robin LaBonte, CFO at the 79-bed York Hospital.
Hospitals could use the money—nearly half (48%) said the economy has forced them to delay 2011 capital projects. And another 40% said some projects have been eliminated altogether. But again, IT projects seem mostly safe from the axe. We asked leaders to name the clinical initiatives they've put off or scaled back. Most (48%) answered none, while a handful cited CPOE and EMRs (15% each).
Finally, investing in HIT makes sense when you consider that 52% of healthcare leaders say improvement to quality of care is their leading priority when it comes to assessing a capital need (34% said they determine funding by replacement need and only 14% said return on investment is the primary factor in the decision.)
"Clinically, with all that's now being measured in terms of quality and patient satisfaction and how it will impact reimbursements, you really have to [invest in electronic medical records] just to keep up," LaBonte says.
Be sure to check the most recent HealthLeaders Media Intelligence Report, 2011 Capital Spend: EMR Dominates Budgets. Turn to page 8 to read Minich-Pourshadi's excellent analysis: "Tech Dominates Capital Budgets as Caution Continues."
Intelligence Reports are archived online, as is the HealthLeaders Industry Survey 2011.