Fed Health IT Spending: $6.5 Billion By 2016

Federal health IT spending will increase from $4.5 billion in 2011 to $6.5 billion in 2016, which represents a compound annual growth rate of 7.5%, according to a GovWin IQ research study released by Deltek. The GovWinIQ report--Federal Health Information Technology Market, 2011-2016--noted that unlike the overall federal market, which faces budget cuts, the health IT market will continue to grow due to rising healthcare costs, an aging population, and continued high unemployment which will drive up federal healthcare expenditures during the next decade.

To curb the rising cost of healthcare, the federal government will be forced to spend on health IT to create greater efficiencies and save money. Much of the focus of health IT spending at federal agencies that have health-related departments, such as the Department of Veterans Affairs (VA), Department of Defense (DOD), and Department of Health and Human Services (HHS), will go toward investing in electronic health record (EHR) systems, IT infrastructure modernization, transformation of payment systems, and IT to support advancements in population health...