Press Release: Gov. Schwarzenegger Announces $25 Million in Grants to Expand Tele-Health

Governor Arnold Schwarzenegger today announced $25 million in new grants for health care and technology projects, which could help expand access to specialty doctors in rural and other underserved parts of the state. Projects eligible for funding could include technology improvements for safety net providers such as rural health clinics, critical access hospitals and county health departments. Other projects could include preventive health care or medical education programs.
“Expanding health information technology is a cornerstone of my comprehensive plan to reform our broken health care system. Using technology in health care not only expands access to underserved parts of California, but also increases patient safety and reduces overall health care costs,” said Gov. Arnold Schwarzenegger.
The grants will be made available through the competitive bid process. The application will soon be available on the California Department of Managed Health Care (DMHC) website at The funds are part of charitable investments required by the state from PacificCare Health Systems when it merged with UnitedHealth Group in 2005.
In July 2006, Governor Schwarzenegger signed an executive order establishing a goal to achieve 100 percent electronic health data exchange in California during the next 10 years. Since then, the DMHC and other state agencies have drafted a health information technology (HIT) blueprint which includes seeking additional financing options.
The Governor’s comprehensive health care proposal includes the following health information technology reforms:
• Requiring e-prescribing by all providers by 2010.
• Supporting standardized Personal Health Records.
• Implementing Electronic Medical Records in counties for mental health systems.
• Supporting HIT adoption through public/private HIT partnerships recommended by a State HIT Financing Advisory Committee.
• Accelerating HIT implementation by leveraging state purchasing power and supporting uniform HIT interoperability standards.
• Expanding broadband capabilities to support telemedicine, tele-health and e-health programs.
According to DMHC, Americans spend $1.6 trillion each year on health care, yet the industry lags behind others in building technology infrastructure like telemedicine and electronic health records. Despite the cost-saving potential from reducing duplicative or unnecessary tests, the adoption of HIT is extremely low. For example, only 5 percent of all hospitals use electronic health records and only 13 percent of solo medical practices and community clinics -- where the majority of Americans get their day-to-day health needs met -- use them.