Use of computerized information systems in U.S. health maintenance organizations and hospitals

A comparison was made between the use of data processing in hospitals and Health Maintenance Organizations (HMOs). Findings indicate that the HMO and hospital data processing markets are currently quite distinct. As expected, the functions automated reflect the uses of the different care delivery systems. The hardware and software vendors to these markets are also different. A high percentage (50%) of HMOs are using software they developed in-house. In this respect, current HMO data processing is similar to the hospitals of a decade ago. The hospital market (for hardware and total systems) is highly concentrated. A few firms have a combined market share of over 50% and there are a large number of firms with very small shares. In the HMO market, there is a high concentration ratio for hardware but not for software or systems. HMOs and hospitals are almost uniformly satisfied with their hardware. Satisfaction with most applications is between 80 and 90% but there is a need, at least within HMOs, for improvements in support of the software supplied.