Hospital IT outsourcing on the rise

More healthcare organizations are starting to look outside their walls for app development, infrastructure services and more.

In fact, about 73 percent of organizations with more than 300 beds responding to a Black Book survey said they are outsourcing IT solutions. For health systems under 300 beds, 81 percent said they will make IT outsourcing a priority next year, according to an announcement.

The survey included 1,030 hospital CIOs and IT leaders, as well as CFOs and financial executives.

"Most hospital leaders see no choice but to evaluate and leverage next generation information and financial systems as an outsourced service in order to keep their organizations solvent and advancing technologically," Doug Brown, Managing Partner of Black Book Market Research, said in the announcement.

Almost 70 percent of CIOs were in support of outsourcing for mobile solutions, and are turning to electronic health records for big data support, predictive analytics and claims management.

"I think what's happening is CIOs are becoming true business partners," Jim Utterback, a principle with executive search firm Witt/Kieffer, told FierceHealthIT in November. "Whereas IT directors I knew in healthcare in the past were in the basement playing with technology tools, the CIO of today in most major healthcare systems can run calculators and capital and financial budgets as easily as they can select EHR vendors."

Some of the top lessons learned in IT contracting, according to the respondents, include:

  • Choosing the wrong vendor
  • Not realizing the full costs of the project
  • Disregarding concerns from employees, the community about the outsourcing
  • Unrealistic expectations
  • Failure to properly monitor the performance of the contracted outsourcer

In addition, Black Book also found that satisfaction with vendors is growing, at an all-time high of 84 percent saying the relationship exceeded expectations. Return-on-investment is also high with 90 percent of organizations last quarter saying they are seeing "at or near an immediate return."

The healthcare payer IT outsourcing market also is expected to grow more than 40 percent in the next two years, FierceHealthPayer previously reported.

To learn more:
- here's the announcement

Read more on