Obama's 2013 budget keeps health IT spending nearly constant

Tools

The federal government isn't raising the amount it spends on health information technology by much in President Obama's fiscal year 2013 budget, according to an analysis by Andrea Falciani of Suss Consulting for Government Health IT. The amount is up just 2 percent to $11.8 billion from $11.6 billion in fiscal year 2012. Yet, in an era of austerity and budget cuts, raising the spending level at all shows the importance the Administration places on health IT.

Ninety-eight percent of the HIT spending is allotted to the Department of Health and Human Services (HHS), the Department of Defense (DoD), and the Department of Veterans Affairs (VA), according to the article. This isn't surprising, considering not only the Meaningful Use incentive program, but also the amounts these departments spend on computer-related initiatives for their own healthcare programs. Those include Medicare, Medicaid, the Military Health System, Tricare and the Veterans Health Administration.

Nevertheless, HHS gets the lion's share of the HIT budget, netting 60 percent, or $7.14 billion, Twenty-eight percent of the federal total, or $3.3 billion, goes to DoD, and the VA gets 10%, or $1.15 billion, the article notes.

Not all of the HHS budget would be spent at the federal level. The budget allocates $2.3 billion to the states as the federal share of the cost of operating Medicaid systems. Medicare and Medicaid don't soak it all up, either. A big chunk of the HHS wish list--$374 million, to be precise-goes to support the IT infrastructure of the National Institutes of Health (NIH).

When the 2013 budget proposal was released in mid-February, NextGov reported that roughly $2 billion of the DoD's IT budget would be allocated to healthcare systems. Specifically, joint electronic health record projects of the DoD and the VA would receive $221 million. Included in that pie is $169 million for the VA-DoD integrated EHR and $52.9 million for the Virtual Lifetime Electronic Record (VLER).

As FierceHealthIT has reported, drivers of the rapid increase in federal health IT spending include rising healthcare costs, population aging and the proven reductions in health costs that health IT can achieve, according to Deltek, a government IT contractor that operates a research subsidiary. A December, 2011 report from that organization projected significant federal health IT spending growthe through 2016.

The number of health IT programs and initiatives that receive federal funding in the 2013 budget is--wait for it--937. Falciani views this as evidence of a robust HIT market in the public sector. But one wonders how officials even managed to cook up 937 different programs.

One reason for the proliferation of initiatives is that they're scattered all across the government. For example, the 2013 budget of the U.S. Department of Agriculture includes $134 million for 45 health IT-related programs, according to the Government Health IT article. And the Department of Justice requests $5 million for two health IT programs mostly related to the medical records of prison inmates.

To learn more:
- read the Government Health IT analysis
- see the NextGov article on the VA budget requests

Related Articles:
VA budget recommendation includes allocation for DoD-integrated EHR
Federal agencies to go on a $6.5 billion health IT spending binge