Upswing predicted for physician IT spending

But some observers say the forecast could bump up against the realities of the business environment that doctors face, including declining reimbursements.

By Tyler Chin, AMNews staff. Oct. 9, 2006.

A recent survey forecasts that six years from now, physicians' offices may well spend more in aggregate on information technology than will hospitals. But some physician leaders say that prediction might not come true because of reimbursement pressures, particularly from Medicare.

BCC Research, a Wellesley, Mass., market research company, is predicting that the U.S. health information technology market will more than double over the next six years, from $16.4 billion in 2005 to $34.7 billion in 2011, with sales to physicians and other nonhospital entities making up more than 51% of the market at that time. That's because the average annual growth rate of sales in the physician office/home care/nursing home/hospice segment, 15%, will outpace sales to hospitals at 12%, the company said

At press time, BCC Research could not provide the breakout dollar figures for just the physician office market. But the company said physicians would be driving the rate of growth within that sector. The total health care market includes sales of practice management, electronic medical records, diagnostic imaging and clinical trials systems.

Some observers agreed that the forecast could come to pass if doctors have the money to pay for EMRs, with startup costs that can run from $10,000 to $40,000 per physician.

"I think right now there is a tremendous interest by many physicians in having EMRs, but I think that many of them are concerned about the business case," said AMA Trustee Joseph M. Heyman, MD, an obstetrician-gynecologist and EMR owner in Amesbury, Mass.