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How Significant Is Healthcare IT Outsourcing in the Increasingly Dynamic Healthcare Industry


Healthcare IT OutsourcingRecent years have seen a massive increase in outsourcing in the healthcare industry, largely attributed to the industry’s efforts to reduce costs while providing quality healthcare service and remaining competitive. Earlier, outsourcing was largely in the fields of medical data entry and medical transcription. Now, healthcare organizations and hospitals are increasingly outsourcing clinical research, Big Data, medical billing, and healthcare information management system requirements to keep patient data secure, to streamline these processes, and improve efficiency. To keep up with constantly evolving technology and complex privacy law and regulation requirements, many organizations are outsourcing their IT requirements to knowledgeable providers so that they can focus more on patient care.

But how popular is healthcare IT outsourcing? For this let us look at what healthcare IT comprises, and a market projection for the period 2017 – 2022.

Healthcare Information Technology covers all technologies and software-based solutions that the healthcare sector utilizes to carry out various processes. Healthcare Market Reports published their updated analysis of healthcare industries on January 3, 2018. This report says that the global healthcare IT outsourcing market is estimated to grow at a CAGR of 10.3% during the period 2017 – 2022. The industry is undergoing a phase of major transformation, transitioning to a patient-oriented, value-based approach, which has contributed to the growth of this market. The various advancements in technology offer excellent solutions to the healthcare industry such as EHR, precision medicines, clinical DSS, analytics driven personalized medicines, health and disease management and so on.

Factors driving the growth of the market are as follows.

  • Lack of proper in-house skilled IT professionals.
  • Shortage of infrastructure or funding required for better and secured IT facilities.
  • Government’s focus on and support for introducing IT in healthcare and the eagerness to implement it.
  • Pressure to minimize operational costs for healthcare providers.
  • To be more efficient and productive.

Experts in the field also agree that outsourcing can be beneficial to healthcare organizations. Jonathan Clarke, Assistant Professor of Health Policy and Administration at Penn State University says that outsourcing is something the healthcare sector should think about, especially when it fuels efficiency and improves access to healthcare. However, it is important to be intelligent about it so as not to put patient safety at risk.

According to a recent Black Book research study, hospitals and physicians have mixed perceptions about the value of IT services outsourcing to vendors. A poll of 1,587 executives whose organizations have contracts with healthcare information technology outsourcing vendors identified that a huge percentage is not happy with services they received.

However, organizations are still continuing to outsource to vendors; the decline in satisfaction is not leading to a decline in the outsourcing trend. On the other hand, many respondents are expanding the use of outsourcing. 82 percent of surveyed hospitals have signed IT departmental outsourcing contracts since the third quarter of 2016 or are selecting a vendor. There were 807 respondents consisting of CIOs and IT departmental leaders, 89 chief financial officers and other financial executives. In total, respondents represented 244 hospital and inpatient organizations and 798 physician practices.

  • Seven vendors out of 68 companies offering outsourced services received the best scores for exceeding expectations on all 18 key performance indicators in the survey.
  • 17 vendors who were judged as superior in 2015 were considered as slipping this year.
  • 40 percent of respondents said that their outsourcing partner met expectations.
  • 39 percent said they believe the vendor is exceeding expectations.
  • 10 percent said that it was too soon to render an opinion.

In the high achievers’ list are vendors including Cerner, Meditech, and Allscripts that scored highest in IT managed services for providers among companies offering EHR systems. Highest among non-EHR outsourcing vendors are Phoenix Health Systems, ICE Technologies, Infinite Outsourcing Solutions, IBM, CGS Healthcare Solutions, NTT Data, and CareTech Solutions.

For surveyed CIOs,
Healthcare IT Outsourcing

  • The main advantage of outsourcing is less time spent in dealing with infrastructure.
  • Another factor contributing to the growth of outsourcing is lack of funding for infrastructure.
  • Outsourcing helps healthcare organizations to focus more on core business.

Healthcare IT outsourcing will continue to grow because of the immediate access it provides to a well-trained staff and the latest advanced technology that are required to meet increasingly complex healthcare demands. A positive ROI is also ensured. When record-keeping processes are done in-house, cost fluctuations are often experienced following high employee turnover or additional headcount requirements. Smaller organizations and medical practices may not find it practical to recruit, train and maintain the required staff and equipment in-house. With third-party IT outsourcing, the costs are more predictable and the record-keeping functions are carried out seamlessly. Most importantly, outsourcing can help improve patient care. This is because data is centralized and easily accessible. The entire care team will have a clear idea of the patient and his/her medical history. The outsourcing partner will ensure HIPAA compliance, as well as well-aggregated, secure and accurate data.

When choosing outsourced solutions for healthcare IT, associate with a professional vendor for maximum benefits. Your outsourcing partner should proactively help you improve your IT functions, and also provide new and better ways to steadily improve cost-effectiveness, user experience, and overall performance. Ideally, BPO companies that are committed to industry best practices such as the Information Technology Infrastructure Library (ITIL) standards, and the PMI project management standards are your best options. Another important consideration is their experience in the field. Your provider should understand the important interconnections between IT, clinical care, and business workflows. Choose a healthcare IT outsourcing provider you can trust, and they should work closely with you to meet all challenges any new requirements may bring.

About Rajeev R

Rajeev R

Manages the day-to-day operations of MOS from NY. With an interest in information technology, Rajeev has guided MOS to extensive use of digital technology and the internet that benefits MOS as well as MOS clients.