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HHS Awards $139 Million To Drive Adoption of Health Information Technology

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HHS Press Release Date: October 13, 2004

The U.S. Department of Health and Human Services today announced $139 million in grants and contracts to promote the use of health information technology (HIT). Awarded through HHS' Agency for Healthcare Research and Quality (AHRQ), this multi-year program builds on President Bush's initiative to use HIT to improve the Nation's health care system.

"Increased adoption of information technology will speed the transformation of health care services in this Nation," HHS Secretary Tommy G. Thompson said. "We're heeding the President's call to improve patient safety and quality of care. Technology can help to efficiently and effectively deliver the information caregivers need to take better care of their patients.These grants will help us ensure that the right patients are getting the right care at the right time."

These awards will provide insight into how best to use health information technologies to improve patient safety by reducing medication errors; increasing the use of shared health information between providers, laboratories, pharmacies and patients; helping to insure safer patient transitions between health care settings, including hospitals, doctors' offices, and nursing homes; and reducing duplicative and unnecessary testing.

In addition to improving care for patients and giving health care providers additional support, health information technology has the potential to produce savings of up to10 percent of the country's total annual spending on health care.

"These grants will provide the momentum needed to move forward with the creation of a safer U.S. health care system based on proven health information technologies, especially in the rural and small communities throughout America where the need is so great," said AHRQ Director Carolyn M. Clancy, M.D. "Health care systems across the country can learn from our grantees' experiences and follow their lead."

The $139 million will be used in the following ways:

  • Promoting access to HIT—Over 100 grants to communities, hospitals, providers, and health care systems to help in all phases of the development and use of health information technology. The grants are spread across 38 States, with a special focus on small and rural hospitals and communities. First-year funding is $41 million and will total nearly $96 million over three years.
  • Developing Statewide and regional networks—Five-year contracts to five States or their designees to help them develop Statewide networks that are secure, ensure privacy of health information, and make an individuals' health information more available to health care providers. The five States are Colorado, Indiana, Rhode Island, Tennessee, and Utah. Participants include major purchasers of health care, public and private payers, hospitals, ambulatory care facilities, home health care providers, and long-term care providers. First-year funding is $1 million for each State and will total $25 million over the course of the contracts.
  • Encouraging adoption of HIT by sharing knowledge—The creation of the National Health Information Technology Resource Center to aid grantees and other Federal partners by providing technical assistance, provide a focus for collaboration, serve as a repository for best practices, and disseminate needed tools to help providers explore the adoption and use of health information technology to improve patient safety and quality of care. The two-year contract, renewable for up to three years, was awarded to NORC, a national organization for research at the University of Chicago. First-year funding is $4 million, with an estimated value of $18.5 million over the course of the contract.

"I view these awards as a building block to advance the adoption of electronic health records," said David J. Brailer, M.D., Ph.D., National Coordinator for Health Information Technology. "These projects will encourage real world laboratories for innovation and provide models for other organizations as we move forward in developing an electronic health record."

The awards address directly the four goals of Secretary Thompson's recently announced Framework for Strategic Action, "The Decade of Health Information Technology: Delivering Consumer-centric and Information-rich Health Care," which are: informing clinical practice and the use of electronic health records, electronically connecting clinicians to other clinicians so they can exchange health information using information tools to personalize care delivery, and advancing surveillance and reporting for population health improvement. The Framework for Strategic Action was released in July 2004 by Secretary Thompson at a Secretarial Summit on Health Information Technology that brought together many of the nation's technology and health leaders.

President Bush in April called for electronic health records for most Americans within 10 years. An executive order provided for the establishment of the office of the "National Coordinator for Health Information Technology" and in May, Secretary Thompson appointed Dr. Brailer to the new position.

For specific information on each award, go to

For more information, please contact AHRQ Public Affairs: (301) 427-1862 or (301) 427-1857.

Note: All HHS press releases, fact sheets, and other press materials are available at


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