IT: In-House vs Outsourcing


Most Hospitals, Clinics, Private Practices, Home Health Providers, and Nursing Homes have an In-house IT Department. While this is the common practice, it is no longer the preferred method of handling your valuable information. Statistically speaking, outsourcing Healthcare Information Technology is a booming market with a Compound Annual Growth Rate of 7.6%. In 2013, Healthcare IT was a $35 billion dollar industry, and by 2018, it is projected to be at $76 billion. The new rules and regulations the government is placing on the health insurance, healthcare systems, and pharmaceutical industries are the main driving force behind the Healthcare IT Industry. They state that Healthcare IT is not only a valuable asset, but in the age of the new HIPAA Regulations, ICD-10, HITECH Act and ACO’s, it has become a necessity.

Why such growth? Like in most cases it comes down to one factor, and that factor is MONEY. Outsourcing Healthcare IT allows practices and organizations to focus on the daily operations while reducing cost. Take your practice, for example. How much do you spend on your IT staff? Now consider you also must pay for training on new rules and regulations, vacation, healthcare benefits, retirement benefits, and the most costly downtime.

Now you may wonder, what is downtime? Well, it is simply the time when your network is not working properly, or “down,” while the IT Department tries to resolve the issue. Because your network was down, your providers and support staff were unable to see patients. So now you are either going to have a waiting room of upset patients, or revenue lost for those who left. In addition to that, you now have to pay your providers and other staff overtime to see the patients that waited.

Also, let’s not forget that the Department of Health and Human Services has started its permanent HIPAA Audit Program. With IT now playing a major role in the new rules and regulations, you have to wonder if your network is up to standard.

HIPAA violations can carry fines that could reach up to $50,000 per violation with a maximum $1.5 million dollars per year. Without proper training and certification of your IT Department, there are many things that they can overlook or they may be unaware of.

For example, let’s say you have one computer that has illegal/unlicensed software or is running an unsupported operating system such as Windows XP. If DHHS conducted an audit at your practice, that one system would be in violation and would carry a fine.

So why outsource? The most obvious answer is that by outsourcing your IT needs, you will be receiving a Healthcare IT firm for a fraction of the price. Also, take into consideration that Healthcare IT firms have a highly qualified staff that can address all your IT needs. They are also trained to understand the importance of compliancy when it comes to the new rules and regulations set forth by the government.