It’s no small feat that, in a year of deep cuts to many healthcare programs in the federal budget, initiatives that promote the use of electronic medical records and other information technology in the healthcare system got a boost.

First, a look at the numbers. The White House is asking for a $58 billion increase for the Departments of Health and Human Services, bringing the total to $698 billion.

In a move that’s angered many in the healthcare community, the budget proposes eliminating $36 billion from Medicare over the next five years, in part by reducing hospital payments. The new budget also calls for Medicaid savings of $13.5 billion over five years. The American Hospital Association called the budget a “step backwards.”

In light of the cuts, the administration is calling for $169 million in funding for healthcare IT initiatives, an increase of $58 million over last year’s requested amount. The Office of the National Coordinator for Health Information Technology, led by David Brailer, MD, is allocated $116 million in the fiscal year 2007 budget. ONCHIT received $61.7 million in the fiscal year 2006 budget; the White House had requested $75 million.

Before getting too sanguine about the budget, one needs to put those numbers in the context of other spending requests and look at the history of healthcare IT funding. As Michael Zamore, legislative director for Rep. Patrick Kennedy (D-R.I.) pointed out, the amount requested for healthcare IT is still less than the $200 million the White House’s budget allocates to encourage marriage and fatherhood.

 “They’re trying to do it on a shoestring,” Zamore said of the administration’s healthcare IT efforts.

And then there’s the Congressional Budget Office, which provides its own estimates for the costs of programs in the budget. Several healthcare IT leaders have called on the CBO to score healthcare IT investments favorably and take into account the potential savings derived from them. But that’s unlikely to happen anytime soon.

“They score the definitely, not the maybe,” David Fisher, majority health policy director for the Senate Budget Committee, recently told a Capitol Hill audience.

Brailer’s office got left out of the federal budget in the first year of its existence. For fiscal year 2006, ONCHIT received $61.7 million, less than the $75 million the White House requested for the healthcare IT office.

Action turns to House

It could be several months before Congress’ willingness to fund healthcare IT becomes clear. In the meantime, look for the House to pick up where the Senate left off after passing S. 1418, the Wired for Healthcare Quality Act. The bill passed late last year by unanimous consent. But such harmony in the House will be trickier.

The most likely vehicle for a House healthcare IT bill is legislation (H.R. 4157), introduced by Rep. Nancy Johnson (R-Conn.). Given Johnson’s position on some key committees, the bill has a bit more steam than other healthcare IT bills introduced in the House.

However, several groups and members of Congress have raised concerns about what they say is a lack of privacy protections in the bill.

“There are concerns about what is in the bill and what is not in the bill,” a high-level Senate staff member recently told a Capitol Hill audience.

Look for House lawmakers, including Reps. Kennedy and Tim Murphy (R-Pa.) who introduced their own healthcare IT bill last year, to attempt to work with Johnson on the bill’s privacy provisions.