Mr. Jones: Absolutely. I believe the stimulus package has captured the imagination of investors and has dominated the action in the shares of HCIT vendors. If we look back to the second half of 2008, the market was essentially throwing these names aside, as hospitals and physician practices began to rein in their cap ex budgets in reaction to looming unemployment, rising bad debt and losses in their endowments. Investors were shying away from the HCIT vendors, along with other healthcare names tied to capital spending, until President- elect Obama decided to include healthcare IT within the stimulus package. The goal of including HCIT in the ARRA was to jump-start the adoption of electronic medical records within hospitals and physician practices. President-elect Obama made the pronouncement in a radio address in early December and the stocks took off from there. After a dramatic rise in December, the group paused in January and February, as investors grappled with the how and when stimulus funding would be made available.
TWST: Do we have that defined now?
Mr. Jones: We do. The stimulus package was signed into law last February and so
established Medicare and Medicaid incentive payments for hospitals and physician
practices that have adopted and are meaningful users of a certified electronic
health record (EHR). However, the definition of meaningful use and what
qualifies as a certified EHR were left up to HHS to determine through several
newly created subcommittees within the Office of the National Coordinator for
Healthcare Information Technology (ONCHIT). But how the payments are to be
issued was established within the stimulus package.
Tickers included in this excerpt: ATHN, CERN, CPSI, ECLP, GEOI, MDRX, QSII
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