Many companies are transitioning their data online while exploring ways to keep costs to a minimum, which is aided by investing in health information management (HIM). To that end, health care IT venture capital funding continued its steady upward trend in the third quarter of 2012, with investors allocating $194 million to 37 deals. Of that funding, investors gave $101 million to HIM companies.
Mobile health companies received $36 million in funding and social health companies received $29 million, according to a Mercom Capital Group report. Three deals were made for clinical decision support companies ($19 million total), while one deal each was made for EHRs (worth $1 million) and heath information exchanges ($6 million) out of 20 HIM transactions. This was the fifth consecutive quarter of growth in funding, beginning in the third quarter of 2011.
Managing information and improving communications continue to be strong areas of interest for health IT companies, according to the report. “Mobile health continues to gain popularity as an effective means of communication whether it be monitoring, messaging or alerts while healthcare apps continue to grow in niche areas that are empowering consumers with knowledge and connectivity,” Mercom analysts wrote.
Payers have recently become more likely to support health care initiatives like telehealth. The accountable care organization (ACO) rules published in 2011 increased the number telehealth procedures covered by Medicare reimbursements. However, health care organizations turn to alternative sources like venture capital deals if a payer or the government fails to monetarily support a health care initiative. Providers can be reluctant to offer or continue certain programs if payers fail to offer reimbursements for patient participation.
Massachusetts is one state in which the government has offered financial support to health care IT projects. A bill pledging $30 million toward electronic health record (EHR) implementation, and telemonitoring education along with other health care projects was approved by the state government earlier this year. The federal government does offer some financial support through EHR meaningful use incentive payments to physicians and hospitals.
The Office of the National Coordinator for Health Information Technology (ONC) also has pledged support of health care IT projects. The agency committed $32 million to training people to fill certain health IT jobs as part of their health IT workforce development training program. The ONC allocated the money to nine colleges and universities in an attempt to fill the shortage of qualified health IT workers. The program was expected to train 1,500 people in a one-year training program focused in one of six areas of study.