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Healthcare Organizations Embrace RFID

Originally published November 22, 2005

Large healthcare organizations are moving ahead faster and with bigger RFID deployments than the industry overall, according to a new study by BearingPoint, and The National Alliance for Health Information Technology. However, industry-wide spending on RFID is poised to dramatically increase beginning in 2007, driven by senior executives who view the technology as critical to helping achieve their organizations' business goals, especially improved patient safety.

"This survey illustrates that most healthcare executives believe RFID technologies are strategic to their business in a number of important aspects, from patient safety to operational improvement," said Jim Gallas, Senior Vice President of BearingPoint's health services practice. "Over the next 24 months, we expect healthcare organizations will move from the strategy and pilot phases they are in today toward first-stage implementations where there will be a strong opportunity for return on investment."

Key findings from the survey of more than 300 healthcare respondents, most from commercial and government healthcare providers, include:

  • Improvement to patient safety was cited as the top benefit for RFID by nearly 70 percent of respondents, with improved patient flow and general productivity ranking second, each cited by 48 percent of respondents as "very important."
  • 80 percent of C-level respondents described RFID technologies as important or very important to their business strategies.
  • 30 percent of large organizations (those with annual IT budgets over $100 million) have already deployed some RFID technology, compared to just 13 percent of smaller organizations.
  • Less than 20 percent of respondents plan to spend more than $250,000 on RFID in 2006 and 53 percent plan no spending at all. But nearly 74 percent anticipate investment in RFID by 2007 and nearly 39 percent anticipate spending $250,000 or more on the technology in 2007 and 2008.
  • Large organizations plan to spend considerably more - between $1 million to $5 million on RFID in 2007-2008.
  • Cost is a chief barrier to adoption; with 57 percent saying a major hurdle is lack of available funding and 46 percent citing the cost of RFID tags and readers as a major issue
  • 60 percent of respondents said they have delayed some RFID activities while they wait for industry or government guidance on standards.

"Too many healthcare organizations are sitting on the sidelines, waiting for more direction on standards and privacy from the government," said Rod Piechowski, Vice President of technology leadership for the Alliance. "Meanwhile, the leaders in healthcare RFID have set their own policies for privacy, security and standards because they see RFID providing a strategic advantage in the marketplace. Now is the time for organizations of all sizes to begin investing in RFID so patients and their overall business can realize the very real benefits the technology can provide."

This BeyeNETWORK news item contains information from a recent press release by the company mentioned.