State Medicaid programs are poised to spend as much as $380 billion on information technology in the coming year, according to a new report from business consulting firm INPUT.
Contracts are expiring for as many as 21 state Medicaid Management Information Systems over the next five years, INPUT reports, and that puts vendors in a good position to sell new technology.
The $380 billion represents nearly 22 percent of all state spending.
The findings were released in an INPUT Industry Insights Report, "Vendors Seeking Health IT Opportunities will Find Them in State Medicaid Systems."
"State MMIS systems are primitive health information exchanges," said Kristina Mulholland, analyst for healthcare and social services at INPUT. "Since there has been a lack of major progress with private efforts in this area, the states and the Centers for Medicare and Medicaid Services will have to continue making the investments here. We've already seen this with CMS's Medicaid Transformation Grants."
INPUT expects the management information systems to become the center of gravity for supporting state health IT and e-health efforts. The Medicaid Information Technology Architecture (MITA) and the Medicaid Maturity Model (MMM) are also guiding the modernization of MMIS systems toward a flexible, quality-based orientation, according to INPUT. However, these transformative tools and standards are only in their early stages.
"Vendors should not worry that the train has left the station," Mulholland said. "We're talking about a process that will run 10 years or more. But, numerous states will be seeking to issue proposals for preliminary systems planning services over the next year or two, so now is the time for vendors to begin making their names known in this space."