Health Care IT Needs Are Growing: 3 Top Stocks to Buy Now

Health and Healthcare

Published: April 7, 2016 10:55 am

Last Updated: January 13, 2020 11:03 am

It is no secret that we have an aging population, and it requires more and more hospital treatment, whether it is inpatient or outpatient. Most importantly, this is a trend that is going to go on for some time, until the demographics swing back some. Add in a very bureaucratic Affordable Care Act, and hospitals around the United States are dealt a very difficult information technology hand.

In a new research report, while Baird concedes that hospital requests for proposals (RFPs) did not take off, and they were in fact below last year, they are generally stable, and that is an overall positive. RFPs are required in most states for government-owned hospitals, and the Baird team sees the data as a solid indicator for future health care information technology (IT) spending.

The analysts at Baird have three preferred ideas for investors to consider. While they may not be momentum, biotech-type alpha home runs, they are probably just the ticket for growth portfolios looking for sector exposure.

Athenahealth

This top stock was hit hard early this year, and while it has rebounded, it still offers a solid entry point. Athenahealth Inc. (NASDAQ: ATHN) provides cloud-based services and mobile applications for medical groups and health systems.

The company provides services through athenaNet, a cloud-based platform. Its services include athenaCollector, a cloud-based revenue cycle management and practice management service; athenaClinicals for electronic health record management; athenaCommunicator, a cloud-based patient engagement and communication service; athenaCoordinator for order transmission; and athenaCoordinator Enterprise for care coordination, patient access and order transmission service.

The company also provides athenaCommunicator Enterprise, a cloud-based population health management service to execute, track and coordinate care across a provider’s network, and Epocrates, a service that includes clinical information and decision support services in the areas of drug and disease information, medical calculator and tools, clinical guidelines, clinical messaging, market research and formulary hosting. In addition, it offers client support, account performance monitoring, relationship management and real-time performance monitoring services.