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Frost & Sullivan: Digitisation of Australia's healthcare system met with widespread apprehension

~Failure of several regional health IT projects hinders trust~

SYDNEY, Feb. 12, 2013  /PRNewswire/ -- Australia boasts an advanced healthcare system supported by both the public and private sector involvement. The country spent 9.3% of its GDP on healthcare in 2011 and is currently focusing on providing people with the tools to support independent aging care and improve healthcare services in remote regions. While modernisation of healthcare facilities and investment in IT has been rapid over the past ten years, adoption still lags amongst physicians and consumers due to lack of trust in information systems. This lack of trust stems from the failure of several regional health IT projects in recent years.

The Australian healthcare IT market was estimated at AUD 783 million in 2012, which includes software tools and applications leveraged by healthcare providers as well as the professional services needed for implementation and support. The market is expected to reach AUD 1.4 billion by 2018 with a CAGR of 10.3% from 2013-2018. Government incentives towards adoption of Personally Controlled Electronic Health Record (PCEHR) and other healthcare delivery programs such as the Practice Incentives Program (PIP) will be the key driver for market growth. Private players on the other hand are focusing on enhancing customer awareness and engagement in their products.

According to Rhenu Bhuller, Vice President of Healthcare, Frost & Sullivan Asia Pacific, the healthcare IT market in Australia is driven by the shift in emphasis from acute care to prevention. This is apparent from the numerous incentive schemes listed in the PIP, which focus on long-term care including incentives for diabetes detection, cervical screening and asthma. In addition to these, the PIP also encourages digitisation of healthcare providers by incentivising adoption of healthcare IT at the GP level across healthcare organisations.

Australia's Personal Health Record (PHR) program opens doors for private investment in eHealth across the country. The Australian market for Electronic Medical Records (EMR) and Electronic Health Records (EHR) is expected to grow at a CAGR of 15.1% between 2013 and 2018. On average, healthcare providers spend a little less than 2% of their operating expenditure on IT which is less than the global average spend of 3.6% as quoted by CeBIT, Australia. This is essentially because hospital CIOs find it hard to justify significant budget allocations towards activities not directly impacting healthcare delivery, particularly when returns on investment are below expectations. Hospital spend on IT is expected to rise under the influence of government incentives to drive adoption.

However, the PCEHR has been received with strong apprehension and even criticism on some aspects across the country. Adoption of PCEHR has been dismal essentially due to the complexity of procedures and requirements for both physicians and consumers. So severe is the issue that the Australia Medical Association (AMA) has called for a step-by-step toolkit to help medical practitioners to participate in PCEHR. Even the PIP for eHealth, popularly termed ePIP, has been received with criticism and scanty adoption with only about half of all general practices in Australia applying for or assigned a Healthcare Provider Identifier – Organisation (HPI-O) number, a prerequisite for payment eligibility.

Bhuller says, "Moreover, while digitisation of health records has made it easier for people to manage their health information, most consumers are anxious about data security. Data privacy laws in Australia are expected to be amended in the next 15 months, but until then patients are concerned about how their medical information is being stored and shared".

"Legacy health IT systems in Australia have been largely uncoordinated. While the country has put tremendous effort in health IT from both a resource and investment perspective, it is difficult to say that these have been hugely successful due to the lack of integration across regional IT systems, as can be seen from the failure of the HealthSMART project" she stated.

By using some of these prior learnings to improve on implementation, Government authorities are optimistic about the prospects of IT in healthcare. They are driving IT adoption by openly accepting and implementing feedback from the public and incentivising eHealth practices. Private software vendors and system integrators expect significant returns from the market essentially because there are opportunities for implementing large-scale installations spanning several healthcare providers.

As cited in a recent Accenture report, EMR and EHR adoption was estimated at 78% across public and private healthcare providers from 2008-2013 and this is expected to grow. Bhuller finished by saying that as clinical systems advance, demand will flare for sophisticated intelligence and analytics tools to help healthcare providers manage and make sense out of the large volumes of data so that they may improve healthcare management and, in the long run, healthcare costs.

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today's market participants. For more than 50 years, we have been developing growth strategies for the global 1000, emerging businesses, the public sector and the investment community. Is your organization prepared for the next profound wave of industry convergence, disruptive technologies, increasing competitive intensity, Mega Trends, breakthrough best practices, changing customer dynamics and emerging economies? Contact us: Start the discussion

Media Contacts:
Donna Jeremiah
Corporate Communications, Asia Pacific
P: +61-02-8247-8927

About PR Newswire
Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

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