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Survey: 70% of Providers Using Off-Premises Computing for Some Applications

December 14, 2017
by Heather Landi
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A survey conducted by KLAS Research found that 70 percent of healthcare organizations have moved at least some applications or IT infrastructure off-premises.

While most of those using off-premises computing are doing so through a hosting environment, future plans lean heavily toward the cloud, according to the survey results.

KLAS surveyed 144 U.S.-based healthcare organizations about the off-premises cloud and hosting options they are currently using, whether they are considering moving to the cloud, why they would or would not move to the cloud and which vendors that are considering or would consider for future off-premises computing needs.

Nearly 60 percent of those healthcare organizations using off-premises services have moved their electronic medical record (EMR) applications to a hosting or cloud environment. The KLAS study, titled “Off-Premises Computing Perception 2017,” found that Cerner is the most used off-premises computing provider in the industry and continues to garner interest from existing and potential clients.

Epic, a newcomer to hosting, has a handful of organizations using their hosting services. “Momentum is building—nearly a quarter of healthcare organizations considering off-premises computing services are considering moving their Epic applications to Epic’s data center, making Epic the most considered among EMR vendors,” the KLAS study stated.

About 69 percent of healthcare provider organizations would consider or are actively considering moving to or expanding their utilization of off-premises cloud solutions. The survey also evaluated the reasons providers are considering, or not considering, moving to the cloud. Reducing capital outlay and lowering costs were cited as top reasons providers are thinking of doing more in the cloud.

Several respondents cited freeing up capital investments in on-premise hardware and infrastructure for investment in other key areas as a key reason why they are looking at moving to the cloud. Other respondents indicated they will move applications or IT infrastructure to the cloud if it lowers the cost of ownership.

Despite these potential advantages, 31 percent of healthcare provider organizations who responded to the survey said they are wary of cloud computing, naming security and privacy vulnerabilities as their top concern. Many respondents said they are more confident in their own ability to keep their environment and PHI data secure, according to the study.

The study also found that the top area healthcare providers are or would consider transitioning off-premises is IT infrastructure, often to the cloud through an Infrastructure-as-a-Model (IaaS) model.

Among the surveyed healthcare provider organizations, cloud infrastructure providers are the most commonly considered, with Microsoft and Amazon at the top of the list. “Respondents most often consider Amazon for their future IaaS and PaaS needs, and many perceive them as an infrastructure leader. While Microsoft is considered more frequently overall than other off-premises computing providers, they are just behind Amazon among those who would consider or are considering broad infrastructure solutions,” the KLAS report authors wrote.

Many healthcare provider organizations start cloud computing with Office 365, adopt it for other Microsoft products, and then expand more broadly to IaaS. Many plan to use public cloud providers for storage, backups, file sharing, email archiving, websites, or non-clinical applications; however, they are apprehensive about putting sensitive PHI in the cloud, the KLAS study found.

The survey results also indicate that 17 percent of healthcare providers have moved their Enterprise Resource Planning (ERP)/Human Capital Management (HCM) applications off-premise, and, of those, nearly three out of four have done so through a hosted deployment model.

However, the KLAS researchers contend that this will shift strongly toward the cloud in the future. “All major software vendors except McKesson have developed cloud-based applications. Workday and Premier products are delivered exclusively through a SaaS model. While Oracle and Infor primarily support legacy customers, both have recently developed new cloud-based solutions that can be deployed on-premises or in the cloud,” the KLAS study authors wrote.

Of those healthcare provider organizations considering moving ERP/HCM applications off-premises, over 80 percent plan to do so in the cloud. Infor is by far the most used and considered for ERP/HCM off-premises computing, according to the KLAS survey.






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