Indian IT circles have found a new ray of hope to jump back to health. Industry bigwigs are eyeing mega-bucks from the US President Barack Obama?s healthcare stimulus package. The US President recently signed the American Recovery and Reinvestment Act, allocating $19.2 billion for health IT, $17 billion of which is earmarked for electronic health records (EHRs). He has pledged to have all medical records of US citizens electronic within five years. This will cut waste, eliminate red tape and reduce the need to repeat expensive medical tests.

For the Indian IT companies, it is time to wave the flag of opportunity for EHR use beginning in 2011. This is because IT will be the cornerstone for bringing in the required efficiency when the overhaul of the US healthcare system gets underway. IT will be instrumental in standardising the way patient information is stored and exchanged between various US healthcare organisations. During the presidential campaign too, Obama pledged to commit $50 billion over five years to support the adoption of standards-based information systems and the national health information network.

Let us concentrate on the financial aspects first. EHR funds will be controlled by the US Health and Human Services (HHS), which has a discretionary use of over $2 billion of the funds. The legislation also allocates, among other things, $85 million for health technology investments, $1.5 billion for community health centres and $50 million to HHS to improve its technology security. The Act gives that job to the National Institute of Standards and Technology (NIST). NIST will receive $20 million to develop standards for electronic health records so that doctors and hospitals nationwide can share patients? files over what will eventually become the Nationwide Health Information Network.

EHR systems typically involve scheduling, patient registration, billing and reporting. Business opportunity for the Indian IT companies will come by way of monolithic automation exercise in the US healthcare system, as it gets rolling soon. ?Major focus is on improving the patient safety and quality. IT focus will be on standardising the way patient information is stored and exchanged between healthcare organisations,? says Makarand Thigale, head?healthcare vertical, Wipro Technologies.

?In the $787 billion stimulus plan that President Obama signed into a law recently, around $150 billion is reserved for healthcare and $87 billion out of $150 billion, is for Medicaid assistance. Medicaid is the US government healthcare programme for families with low income and resources. It is governed by individual states and operated by fiscal agents appointed by each state,? says Thigale. Wipro is a Medicaid fiscal agent for one of the key states in the US. With its unique positioning in the Medicaid market compared to other Indian IT companies, Wipro Technologies could have an advantage. The major challenge for EHR adoption is information privacy and confidentiality. ?With our Health Insurance Portability and Accountability Act (HIPAA) compliant delivery models, we address the privacy and confidentiality issues,? Thigale adds.

K Vinayambika, vice-president, healthcare practice, Cognizant says that in order to assess the market potential, Indian companies have to first understand the EHR market. ?Today, there are standalone EHR products, integrated EHR products (integrated with hospital information system systems), hosted EHR products (from companies such as Google and Yahoo!), in-house developed EHR products, and so on,? he says.

?Secondly, EHR products have various uses. For example, some are designed for use within one hospital or physician practice, whereas others are designed for use across the community. Another different concept in EHR is who owns and maintains the EHR. For example, Google and Microsoft have designed EHRs which will be owned by the patients (users), whereas HIS-integrated EHRs are owned by hospitals and community-focused EHRs are owned by payers or community institutions,? Vinayambika adds.

Business potential emerging from the US healthcare stimulus is astounding. Estimates for the overall EHR market have varied between $115 billion over 15 years to the most recent estimate of $150 billion over eight years. Cognizant believes the business potential in EHR is clearly over $100 billion over the next few years.

Cognizant?s assessment is based on the fact that currently, less than 5% of physicians in the US use an EHR. They will need to invest in EHRs because several federal laws and initiatives have mandated the use of EHR in healthcare delivery.

Predictably, Indian IT companies will target a host of EHR services. These would include EHR product development, implementation including customisation of modules for a hospital?s requirements, maintenance and support, reporting services and systems integration. In addition, related services on EHR such as product evaluation, business process management, EHR-related security services, and so on, will also be a key area of focus for Indian IT companies.

In the context of EHR as a potential market for Indian IT firms, healthcare analysts inform that Indian firms have traditionally preferred services, rather than product development. ?We expect the same trend to continue in the EHR market also.

However, if the Indian IT firms have deep healthcare knowledge and experience, they can also aim to build and sell an EHR product,? informs an analyst.

At the same time, the business opportunity is not a ready-to-eat plum. For, there are other countries eying the market opportunity, coupled with the ongoing recession effect and apprehensions about outsourcing to India. Nevertheless,

Indian IT companies are unfazed by the bottlenecks. ?There will be a significant component of EHR business that would need to happen onsite at the physician and hospital locations, with limited potential for offshoring. Hence, the opportunity is huge for Indian firms that can quickly ramp up presence in the US to address this demand. There is a big chunk of activity such as design and development and testing of EHR components, which can be easily delivered from India,? says Vinayambika.

Elaborating, she explains, ?There are legal issues which have to be dealt with as there is access to private health data. The legal issues center on penalties for breach of privacy of health data. Indian firms that have access to private health data have to ensure certain security and privacy measures are in place.? These measures could include appointment of a chief security official, written policies and procedures on handling medical data, employee training and sensitivity on handling personal health data, physical security of computers and access controls etc.

iSoft, which has a partnership with the NHS, National Programme for IT in healthcare in the UK, is bullish on its next generation health IT solution called Lorenzo Studio. iSoft managing director S Govind feels that Lorenzo Studio is particularly suited to the US market.

?The functional map of Lorenzo product services covers the entire spectrum of care activities, which can be a combination of administrative and clinical information. Coupled with flexible configuration tools and engines, it enables the healthcare enterprises to maintain the electronic health record for the entire life history of the patient,? says Brian Cohen, chief technology officer, iSoft.

Needless to say, as the American healthcare system is on the threshold of a major overhaul, the refurbishing exercise could prove a boon to the Indian IT companies. If the anti-outsourcing talk in the US dampened the spirits of Indian IT companies, they could find solace with numerous IT-healthcare contracts coming to their way.