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Updated by Charles Bystock on 11/18/2022
healthcare outsourcing

With healthcare organizations firmly committed to reducing costs while delivering higher quality care, healthcare IT outsourcing has risen as a premier option for support, offering optimal benefits with minimal management.

Historically, IT Outsourcing put many clients in a “my mess for less” situation, focused purely on cost reduction, which were often unsuccessful. While more healthcare environments are outsourcing, some providers are not delivering on their promises in regards to quality of services, cost targets, or flexibility to meet the changing healthcare environment. This failure is often the result of one or both of the following:

  • A flawed procurement process
  • Inadequate governance and communication processes

With patient care and even lives hanging in the balance, what options do healthcare teams have to ensure the success of these critical partnerships?

Benefits of healthcare IT outsourcing

More recently, outsourcing has proven valuable across many industries and services. Today, health IT has risen as a prime candidate for outsourcing success, offering myriad benefits including improved experiences for both patients and caregivers, reduced costs, improved efficiency and productivity, increased flexibility to adapt to changing organization and market needs, and more.  From technical support to managed services, cybersecurity to networking and communications management, there are numerous opportunities to outsource health IT in today’s healthcare environment.

Third-party providers can bring economies of scale in technologies, techniques, introduction of new technologies and methods, staffing, skills, and experience. This is especially true in IT, where the cost of finding and hiring top experienced talent is increasingly prohibitive for resource-constrained teams. According to a 2022 report released by the Society for Human Resource Management (SHRM), many employers estimate the total cost to hire a new employee can be three to four times the position's salary . . . that means if you’re hiring for a job that pays $60,000, you may spend $180,000 or more to fill that role.” With staffing shortages prevalent in healthcare environments and the cost to hire a permanent, full-time employee high, outsourcing becomes even more appealing to bridge the gap without sacrificing quality.

healthcare trends

What trends are driving healthcare teams to outsource IT?

The latest trends for health IT outsourcing extend beyond software to the management of complex functions. Health IT outsourcing is no longer confined to support of specific software; entire network architectures and infrastructures can be maintained by third-party providers.

Some trends that are driving healthcare teams to outsource IT include:

  • Increased demand for modernization of the technology stack in healthcare. Often, internal IT teams do not have the bandwidth or, even worse, the skill sets or experience to support advanced digital transformation initiatives, requiring added resources.
  • Budget constraints make it difficult to attract and retain the right talent, which means the team must look outside of their four walls to fill those needs.
  • Higher health IT standards and competitive requirements for critical systems such as electronic health records, patient dashboards, system integrations, and more. Health IT regulations and requirements are continually evolving, requiring consistent assessment and maintenance. This can pose a challenge for resource-constrained teams, leading to a push for outsourcing.
  • Mergers and Acquisitions, requiring even more bandwidth from existing, constrained staff to address the consolidation and integration requirements.

Many healthcare teams are choosing health IT outsourcing to manage critical functions. Although this provides short- and long-term benefits, there are risks involved. Namely, healthcare teams must choose the right solution from the right provider and establish governance and a collaborative relationship to ensure success. Choosing the wrong provider can have serious consequences.

Striking a healthy balance

Health IT outsourcing requires balance. Healthcare is a unique service that must balance quality of care and people’s lives with economic realities and profit goals. When profit becomes the dominant goal, the best interests of patients, healthcare staff, and the healthcare system can be jeopardized. To ensure a healthy balance of cost optimization and quality of care, many healthcare leaders are leaning on health IT outsourcing as an extension of their team.

Finding the right outsourcing solution and provider is not a trivial exercise. When lives are at stake, healthcare organizations need a trusted advisor who is experienced at providing a critical eye and extensive rigor to select the best solutions and providers to support optimal patient care and staff experience, in a way that also reduces costs and burden on teams. That’s why many healthcare organizations seek out the trusted counsel of The Windsor Group Sourcing Advisory. Talk with our team about our unique engagement model and best practices for finding, defining, and managing these critical partnerships. We can help.