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70% of Healthcare Organizations Have Adopted Off-Premises Computing

A recent survey of 144 U.S-based healthcare organizations has shown the majority have already adopted off-premises computing for applications and IT infrastructure.

The popularity of off-premises solutions is growing steadily. The KLAS Research study revealed 70% of healthcare organizations have moved at least some of their applications and IT infrastructure to the cloud. Out of the organizations that have, almost 60% are using a cloud or hosting environment for EHR applications.

69% of healthcare organizations said they would consider utilizing off-premises cloud solutions, or are actively expanding the use of those solutions.

Cerner is the leader in off-premises computing for EHR applications, although Epic is attracting considerable interest, with many of its customers considering switching from its on-premises solutions to its data center.

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One of the fastest growing areas is Infrastructure-as-a-Service (IaaS) as it enables healthcare organizations to leverage off-premise infrastructure rather than having to build a data center.

Amazon leads the way in this area and is the market leader and the most commonly considered provider for IaaS and PaaS, although Microsoft is a close second. Microsoft is also the most commonly considered provider for all off-premise options. Microsoft is also most commonly chosen by organizations that are just venturing into cloud computing, starting off with Office 365 before exploring other Microsoft cloud-based products.

The biggest driver that is pushing healthcare organizations to the cloud is the opportunity to reduce costs – both capital outlay and operational costs. Many healthcare organizations that having started transitioning to the cloud have done so to free up capital investments in on-premise hardware and infrastructure to allow them to invest in other areas.

51% of organizations are considering the cloud to reduce costs, 40% said the cloud was being researched to address resource constraints, 29% saw the cloud as a way to enhance services and capabilities, while 11% said the cloud could help them improve their system performance. Only 9% saw the cloud as a way to improve security.

It is security and privacy of off-premises solutions that is causing the most concern. 31% of provider organizations said they are concerned about cloud computing, especially security vulnerabilities that could place the privacy of data at risk.

Out of the organizations that are considering using the cloud, most are considering using the cloud for backups, email archives, storage, file sharing, and non-clinical applications. Most healthcare organizations were apprehensive about moving sensitive protected health information to the cloud.

One area that has seen significant growth is use of the cloud for enterprise resource planning (ERP) or human capital management (HCM) applications. 17% of surveyed companies had already moved ERP and/or HCM applications to the cloud with almost three quarters doing so through a hosted deployment model.

KLAS believes more healthcare organizations will choose to switch to the cloud in the future as more options become available. KLAS reports that most software vendors have started developing cloud-based solutions in addition to their on-premises solutions, and many healthcare organizations are likely to make the switch.

Author: Steve Alder is the editor-in-chief of HIPAA Journal. Steve is responsible for editorial policy regarding the topics covered on HIPAA Journal. He is a specialist on healthcare industry legal and regulatory affairs, and has several years of experience writing about HIPAA and other related legal topics. Steve has developed a deep understanding of regulatory issues surrounding the use of information technology in the healthcare industry and has written hundreds of articles on HIPAA-related topics.