A report released Wednesday by forecasts market research firm Input suggests that federal spending on health information technology (IT) will increase substantially across the next five years, reaching $4.5 billion by 2013, Government Health IT reports. Specifically, the report predicts that federal health IT spending will grow at an annual rate of 7.1 percent, in part because of spending by the departments of Defense and Veterans Affairs on modernization projects, as well as plans by the agencies to expand health IT use in their pharmacy and laboratory operations. The report also notes that the compound annual growth rate will be larger than the overall growth rate for health IT spending, which could make the projected market growth even more substantial. One principal analyst for Input notes that, “as a whole, what's had a dampening effect on health IT, not just in the federal market but nationwide, is a lack of agreed-upon standards." According to the report, however, efforts to establish health IT data standards could pay off in the next five years, leading to potentially higher rates of market growth (Perera, Government Health IT, 2/21/08).