The Obama administration recently said nearly $1 billion of Federal funds allocated in last year's health reform law will go toward innovation programmes designed to improve patient care. This is good news for companies such as US-based software service providers, such as Cognizant Technology Solutions and Dell Healthcare and Life Sciences Services (both have large operations in India), to work on some of the programmes.
The healthcare system in the US is undergoing a major transformation, and information technology is the backbone of these efforts to change the way health care is delivered, said Mr August Calhoun, Vice-President of Dell Healthcare and Life Sciences Services. “Grants such as these will spur ideas for applying technology in new ways to create greater efficiency and cost savings while improving health outcomes.”
According to Ms K. Vinayambika, Senior Vice-President, Healthcare Practice, Cognizant, the American Recovery and Reinvestment Act, also known as the Stimulus Act and one of the two Acts that open earning avenues for software companies, that was passed recently has a healthcare component of over $130 billion for funding health programmes, including around $20 billion as incentives for hospitals in the US to invest in electronic health records.
The Healthcare Reforms Act is the second Act which mandated reforms across the healthcare industry — including providing more coverage for the uninsured, creating new models of care delivery, health data exchange, increased governance and optimising costs so as to meet budget deficits.
For Cognizant, healthcare sector grew the fastest at 11 per cent sequentially in the quarter ended September 2011, representing 26 per cent of revenues for the quarter.
“Our ability to address the bottom-line and top-line aspects of our client businesses, along with deep expertise of regulatory matters gained over a period of time, positions us exceedingly well,” Ms Vinayambika said referring to the business opportunity that the reforms will create.
That Cognizant serves clients across the entire supply chain in the healthcare sector — payers (health insurers), providers (hospitals), pharmaceutical, pharmacy benefit management companies, medical devices and biotech — also helps the company, she said.
The impact will be minimal due to the reforms, Mr Joseph Walent, an analyst with Technology Business Research, Inc, a US-based research firm. The drive for increased efficiencies is beyond legislated use of electronic health records in the US. Further, the need for improved outcomes resulting from healthcare dollars is indeed a global goal, across developed and emerging economies, he said.