Input: Health gateway projects offer ground-floor opportunity

Government contractors will find ample opportunities next year for projects that help state and local governments lay a strong foundation for a robust infrastructure for health information technology systems, reports Input Inc.

In a new report, the Reston, Va., market research firm examined 10 projects planned for gateway health IT infrastructure that offer a robust business opportunity to vendors without a previous track record in the health care sector. The 10 projects are worth a total of $35 million, Input said.

"States and cities have decided not to wait around for a federal 'green light' or for Regional Health Information Organizations to obtain financial sustainability," said Kristina Mulholland, Input's analyst for health care and social services.

In the meantime, states are passing legislation, enacting public-private study groups, and seeking both federal and state funding for gateway projects. Input expects this trend toward self-reliance to last until the next presidential administration takes office in 2009.

The report cites, as an example, a $5.5 million health record bank project in Oregon funded via a Medicaid Transformation Grant obtained from the Centers for Medicare and Medicaid Services. The project serves as a prime example of states engaging in pilot testing and assessment before statewide expansion, Input said.

"The good thing about health IT is that there is still time for small vendors and vendors who are newer to the health care vertical to build their reputations among the states and localities," Mulholland said. "Vendors who win projects like these will be positioned for major, transformative integration efforts down the road. This includes billions of dollars in Medicaid management information system enhancements and overhauls."