Health IT spending plans fall short of predicted needs
Proposals on Capitol Hill would only provide enough funding to get effort off the ground.
The Health and Human Services Department is preparing to award contracts this fall for a health information technology network, but all funding proposals for fiscal 2006 would be far less than the estimated costs to build the network.
A report in the Aug. 2 issue of the Annals of Internal Medicine estimates the five-year capital investment at $156 billion, or $31 billion annually, plus another $48 billion in annual operating costs. Both the president's budget request and the Senate and House spending proposals for HHS would miss that mark by billions of dollars.
President Bush requested $125 million for health IT, with $75 million directed toward building a "medical Internet" and another $50 million to the Agency for Healthcare Research and Quality to foster the adoption of health IT.
"It is enough to get us off the ground ... but clearly not enough to get to our goal," said Janet Marchibroda, CEO of the eHealth Initiative.
The House, meanwhile, approved $46 million for the office of David Brailer, the coordinator of health IT at HHS and an expert panelist for the recent study. The Senate Appropriations Committee in July recommended $45 million, some $30 million less than the president's request.
Brailer's office is leading the charge for a national network of electronic medical records and estimates that such a move could save as much as 30 percent of health care spending annually. Congress also has introduced roughly 20 pieces of legislation that tout information technology as a means to reduce medical errors, increase quality and decrease medical costs.
But the proposed appropriations do not reflect the sense of urgency apparent in those efforts.
The Senate Appropriations Committee recommended some other health-related IT provisions in addition to funding Brailer's office. The House spending bill would provide $92.2 million for overall health IT spending for the year, up $21 million from fiscal 2005.
About $32 million would be directed to social-services research, including $6 million for the Administration for Children and Families temporary assistance program in order to help states improve and streamline data collection and exchanges.
Funding to revitalize the Center for Medicare and Medicaid Services also would target long-term IT concerns, including the claims-processing system. The House and Senate recommended a two-year budget of $24 million.
The business community and health industry stakeholders are looking to HHS Secretary Michael Leavitt and the federal government for health IT leadership.
"The federal government must drive adoption of health IT by creating real incentives, such as grants, loans and reimbursement payments, to encourage private-sector adoption of this vital technology by a certain date," Michael McCallister, chairman of the Business Roundtable's health and retirement taskforce and CEO of Humana, said in a May statement when the roundtable issued a report on the subject.
"What is happening in Congress is a very positive sign," said Marchibroda. If Congress passes a pay-per-performance and health information technology bill thus year, "it will be enough to lay a strong foundation for future years," she added.