Market boost as experts predict NHS hospitals will spend £800m a year on IT
Despite public sector cuts, new report forecasts increased spending on information solutions
Market experts are predicting that within four years NHS trusts in England will be spending around £800m a year on healthcare IT solutions.
A huge increase in opportunities for suppliers is expected as acute trusts in particular respond to the end of the NHS National Programme for IT and increasing pressure to modernise traditional paper-based systems and enhance patient safety and administrative efficiency.
The forecast is outlined in a Market by Numbers report by EHI Intelligence published to coincide with the EHI Live event.
It reveals that total IT spend in the sector is likely to increase by 4.2% in 2012/2013 despite NHS budgets remaining flat. After this financial year, spend will continue to grow, reaching £839m in 2015/2016. This is in marked contrast to the squeeze on public sector spending expected in the last years of the present Parliament.
While the news today is full of stories of public sector spending squeezes and financial cutbacks, our research as a whole paints a more nuanced picture for the NHS IT sector
EHealth Insider editor, Jon Hoeksma, said of the findings: “Among the encouraging signs to emerge from this survey is evidence that acute trust boards are starting to recognise the value of IT, the need to protect IT investments, and to place more value on the IT departments that make them.
“At a time of austerity, when the public sector is looking to shed staff and NHS trusts are talking about losing a significant proportion of their headcount, this report demonstrates that IT staff are being shielded from the worst of what is coming and that represents a considerable vote of confidence in healthcare IT by trusts and their boards."
Spend on IT staff was just one area covered by the survey, which also included a breakdown of spending by acute trusts on services, software, hardware and communications together with an insight into the market conditions influencing current and future spend on big-ticket software applications such as Picture Archiving Communication Systems (PACS), Radiology Information Systems (RIS), Electronic Patient Records (EPR) and Patient Administration Systems (PAS).
Key findings include:
- IT spend for which NHS acute trusts in England are directly responsible is around £800m per year, with a small amount of additional funding coming from the remains of the NHS National Programme for IT
- Almost all categories of IT product spend will increase over the next five years, with significant increases for IT services, hardware and software, and smaller, but still significant, increases for IT staff
- PAS replacements, PAS plus projects, and EPR programmes will remain by far the biggest market opportunity, with a predicted £141m spent by 2015-16
The forecasts are based on key data collected through EHI Intelligence's indepth interview programme with NHS IT directors, the 100,000 data points on the EHI Intelligence NHS Trust Database, and insight from suppliers selling to the market.
Among the encouraging signs to emerge from this survey is evidence that acute trust boards are starting to recognise the value of IT, the need to protect IT investments, and to place more value on the IT departments that make them
eHealth Media director of research, Paul Smith, said: "Our market forecasts are based on a model that, we believe, provides the most reliable and accurate insight available into the financial trends, status and prospects of the NHS IT market.
“While the news today is full of stories of public sector spending squeezes and financial cutbacks, our research as a whole paints a more nuanced picture for the NHS IT sector."
Click here to read more on the report.
