About 10 years ago, Dr. Fleur Sack quit her practice as a family physician to become a hospital department head. Spurring her decision was the need to switch from paper records to electronic ones to keep her private practice profitable. “At that time, it would have cost about $50,000,” Dr. Sack recalled. “It was too expensive and it was too overwhelming.”

But times and technologies changed, and last year, Dr. Sack left her hospital job to restart her medical practice with an affordable system for managing electronic patient records. She agreed to a $5,000 setup fee and a subscription fee of $500 per month for the system. Her investment also qualified her for subsidy money, which the federal government pays in installments, and to date, her subsidy income has paid for the setup fee and about two years of monthly fees. “So far, I’ve got my check for $18,000,” she said. “There’s a total of $44,000 that I can get.”

That kind of cash flow is one reason why so-called EHR software systems for electronic health records have been among the hottest-selling commercial products in the world of information technology. EHR system development is a growth industry in South Florida, too. Life sciences and biotechnology are among the high growth-potential sectors identified by the Beacon Council-led One Community One Goal economic development initiative unveiled in 2012; already, the University of Miami has opened a Health Science Technology Park while Florida International University has launched a healthcare informatics and management systems program in its graduate school of business.

For many young businesses in the area’s IT industry, government incentives are paving the way. The federal government is pushing doctors and hospitals to use electronic health records to cut wasteful spending and improve patient care while protecting patient privacy — sending digital information via encrypted systems, for example, rather than regular email.

Under a 2009 federal law known as the HITECH Act, maximum incentive payments for buying such systems range up to $44,000 for doctors with Medicare patients and up to $63,750 for doctors with Medicaid patients. Hospitals are eligible for larger incentive payments for becoming more paperless. The subsidy program isn’t permanent; eligible professionals must begin receiving payments by 2016. But by then, the federal government will be penalizing doctors and hospitals that take Medicare or Medicaid money without making meaningful use of electronic health records.

“What the government did is, they incentivized, and now they’re going to penalize,” said Andrew Carricarte, president and CEO of IOS Health Systems in Miami, one of the largest South Florida-based vendors of online software service for physician practices. He said insurance companies also may start penalizing physicians for failing to adopt electronic health records because “the commercial payers always follow Medicare and Medicaid.”

It’s all part of the growth story at IOS Health Systems, which has more than 2,000 physicians across the nation using its online EHR system. Carricarte said many of the company’s customers buy their second EHR system from IOS after their first one flopped. “Almost 40 percent of our sales come from customers who had systems and are now switching over to something else,” he said.