Gary Herschman, Paul Gilbert Quoted in "Health IT Sector Showing High Potential for Accelerated Growth"

The health information technology sector is poised to become the next big thing for investors in the health-care industry.

The health-care industry continues to evolve to keep pace with quality- and performance-based reimbursement changes and health IT is playing a critical role for providers trying to keep up. Transaction activity in the health IT area is hot, reflecting providers’ efforts to evolve, health-care attorneys and investment bankers told Bloomberg Law. …

The number of transactions in the health IT sector is expected to increase precipitously in the coming 12 to 24 months, Gary W. Herschman, of Epstein Becker & Green in Newark, N.J., told Bloomberg Law. Herschman, who counsels health-care providers and health industry companies on transactional matters, is a Bloomberg Law advisory board member and a member of the transactions editorial advisory team. …

Health IT drives innovation in health-care provider policies and protocols, data analytics, clinical integration, patient engagement, and overall population health, Herschman said. There is a huge demand and need for platforms that allow providers to analyze real-time data to better inform their clinical care decision-making, leading to quicker, less-expensive, and higher-quality care, he said.

Products that improve patient engagement, or the ways doctors and patients communicate and share information, also will be receiving more attention from the investor community, Herschman predicted. Software programs and wearables like smart watches and fitness trackers that allow for instantaneous data transfer and communication already are helping to improve population health, including medication compliance, preventive care and monitoring of patients with chronic illnesses, and pre- and post-surgical care, he said.

IT platforms are—and will continue to be—one of the leading tools in changing the way patients are kept healthy and receive treatment, and this is accelerating the otherwise slow transformation to value-based care, Herschman said. “As more health-care IT platforms are introduced in the coming months, the rate of this acceleration will continue to grow, he said. “It is like comparing the speed of internet access five years ago versus today,” he said. …

Post-acute care sector consolidation “will continue to accelerate as providers seek to build market relevance across a broad continuum” of the sector, Paul D. Gilbert, of Epstein Becker & Green’s Nashville, Tenn., office, told Bloomberg Law. Gilbert represents a broad range of rapidly growing health-care providers.

Hospitals appear to be jumping into the sector, but they are “developing post-acute service models through partnerships and other contractual relationships with preferred providers, rather than directly owning and operating post-acute providers,” Gilbert said.

“As a result, it feels like an arms race of sorts is developing among post-acute providers to build the most attractive and comprehensive networks,” Gilbert said. “As with hospital systems, it seems that post-acute providers and investors have decided that scale, in addition to a broad range of service offerings, will best position them to attract and negotiate contracts with large hospital systems, employers, and payers.”