Health care orgs must reach IT

It takes a long time for healthcare organizations to see a return from IT investments, according to a recent report.

“The Economics of IT and Hospital Performance” report from PricewaterhouseCoopers concluded that IT investment must reach a tipping point before it can lead to cost reduction. Until reaching that point, hospitals experience operating costs with little near-term financial benefit. The report is based on an analysis of performance data from nearly 2,000 U.S. hospitals

Six out of 10 hospitals are at or nearing the tipping point, and industry-wide cost reductions and quality improvements associated with IT investment may soon begin to become more apparent. However, even hospitals that have reached the tipping point are experiencing less dramatic returns on investment than other industries have realized, the report noted.

“The business case for increased IT spending has been a foregone conclusion, but it is based largely on untested claims and the experience of other industries,” said David Levy, principal at PricewaterhouseCoopers’ health information technology practice leader.

“The lack of reliable, industry-specific empirical evidence has left hospital executives wondering whether IT investments will ever really pay off and unclear about the extent to which a transformation will occur,” Levy said. “We can now retire this question and definitively say, Invest in IT; it works. But have patience.”

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Jim Love, Chief Content Officer, IT World Canada

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