Five Ways Cloud Computing Can Save the Bottom Line

Software Solution, Cloud Technology, SaaSCommon business practices dictate two options for healthcare organizations to survive in today’s competitive marketplace: cut costs and increase gross revenues. The two seem diametrically opposed as most hospitals are working to cut staffing costs while working to increase the number of patients seen. By leveraging the cloud, the potential exists to save costs while improving service delivery and increasing patient satisfaction. All told, leveraging the cloud can save a healthcare organization’s bottom line from spiraling into the red.

1. Replace capital expenditures with manageable operational costs

A significant advantage in moving into the cloud is minimizing the spikes in budgetary expenses. Purchasing, upgrading or repurchasing new servers and software can be replaced with an ongoing subscription fee. This structure is much more cost effective for most hospitals, many of which simply do not have the cash necessary to invest in IT infrastructure that becomes obsolete in a few years' time. By replacing those capital expenditures with manageable ongoing operational costs spread over time, hospitals free up vital cash flow to further invest in improving patient services as well as the acquisition of vital health equipment needed to compete in today’s market.

2. Economies of Scale

Cloud computing service partners are effectively renting systems and IT infrastructure to their clients. This model provides a means to leverage “one to many” in that a cloud service partner acquires assets at a fraction of the retail prices paid by individual hospitals. Another benefit provided is the ability to operate their facilities on the most up to date systems available and pay a lower annualized fee than if purchased and managed internally. Moreover, load balancing and hot fail over sites can be included or incorporated for minimal fees to ensure up time and reduce additional potential losses.

3. Lower Running Costs

The litany of expenses associated with owning IT only begins with the initial investment. Duplicates for cold swaps, fail over systems, software subscriptions, 24X7 phone or onsite support must be purchased and maintained annually. The second significant cost is employing the droves of IT resources needed to manage the entire process of deploying, maintaining and servicing the systems you’ve purchased.

4. Network Security

State and Federal security requirements levee a heavy toll on operational expenses. In order to comply with HIPAA as well as the myriad of state requirements to protect PHI, healthcare organizations are required to invest in and maintain the best they can afford in securing the information of every current and former patient, employee and board member. The cost of compliance is high, but the costs of a data breach event (averaging more than $200 per record lost or stolen) and non compliance is higher. Cloud providers utilize the best in network security architecture, employees and systems more than most healthcare organizations can afford. Harnessing the skill set and horsepower of Cloud security can save a hospital hundreds of thousands of dollars annually.

5. Spend only what is necessary

Traditional budgeting of resources necessary to operate an individual facility drives the operational costs of IT up, up and away. Much of what may be necessary to operate a specific service is inefficient as the overhead of the operating system to provide service may have significant hardware requirements that remain unused but still have the same costs. The streamlined approach of cloud computing means services can be bundled together and sold to clients by the number of users who need access to resources. The provider bears the burden of minimum requirements of software and hardware that are then spread across 10’s or 100’s of clients.

In healthcare today, the lines between profit and loss shrink annually. Harnessing the scalability and efficiencies available in cloud computing will provide your hospital with the ability to inject once lost capital back into healthcare initiatives needed to compete at the highest level in healthcare.

Provider Credentialing


Jim Leonard

About the Author
Jim Leonard

Jim serves symplr as the business development leader of Provider Management and Payor Enrollment. He brings more than 20 years of highly successful sales, marketing and consulting leadership to symplr. His team’s focus is to aid clients with the identification and resolution of gaps in current credentialing, privileging, peer review, quality, and event reporting programs. Jim’s insight into utilizing technology to create transparency and improve operational efficiency promotes overall improvement in provider and hospital performance; further aiding clients in meeting or exceeding compliance with governing body requirements such as CMS, JC, DNV, and CIHQ.

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