Three Key Trends Reshaping Cloud Healthcare in 2015: Cost Efficiency, Customization, and Collaboration

According to Stephen Piazza, Chief Technology Officer of Invidasys, the Dell Global Technology Adoption Index shows that 96% of healthcare institutions are using or considering adopting cloud computing. In fact, healthcare organizations that had already adopted cloud computing before 2015 have been reducing their IT costs by an average of 20% annually. What new trends will cloud healthcare bring in 2015?

HitConsultant recently interviewed Stephen Piazza, Chief Technology Officer of Invidasys, to explore how cloud technology is poised to reshape the healthcare IT landscape in 2015. VCBeat has compiled and translated the interview content.

What Were the Three Trends Reshaping Cloud Healthcare in 2015?

1. Cost:Cost is a critical component of cloud computing. It is well known that most healthcare IT systems come with a hefty price tag: the software is expensive, and the ever-expanding server infrastructure is exorbitantly costly. The so-called “entry into the cloud era” signifies our transition into a pricing model that is entirely unfamiliar to most healthcare IT departments, which have long been accustomed to purchasing servers and storage devices. However, in the cloud era, we have moved into a fully virtualized, non-local environment where charges apply to every service utilized, every unit of storage consumed, every bit of bandwidth used, and each individual user. Therefore, effective cost control in the cloud requires leveraging a multi-tenant architecture.

By leveraging multi-tenancy technology, we can create a single instance of a database server to serve all customers/tenants. We must ensure the security of the application in a multi-tenant environment. When carefully crafting multi-tenant applications, we can also share an increasing number of infrastructure components. Using the Legacy/TurnKey model, it may be possible to share databases, but not application servers or front-end user experiences. If we achieve true multi-tenancy for the application, we can share both database and application servers, and potentially even the user experience. For the user experience layer in legacy applications (such as Windows applications like Outlook or Word), we use a cloud server for hosting. In the cloud era, user experiences will be web-based, allowing users to take responsibility for rendering the user experience, thereby eliminating the need for operators to dedicate a separate tier of cloud servers to host it. Therefore, web-based, multi-tenant, shared instances are the key to controlling cloud costs.

Diverse approaches to provisioning tenant environments can also help control cloud costs. In the traditional IT world, we needed to understand server requirements for the operating environment, often leaning toward maximizing utilization. For instance, with up to 50 users, we had to ensure the chassis size could accommodate enough disks; furthermore, we had to carefully forecast data growth, as handling additional capacity upgrades on a daily or weekly basis was impractical. In the cloud era, these are no longer issues. We only need to understand the most immediate needs and provision instances accordingly. If higher demands arise in the future, we can easily address them by expanding memory and enhancing processing power. With the right architecture, we can adapt flexibly to changing demands. We can scale resources up or down within a single day based on requirements. The services, bandwidth, and processing power we pay for fluctuate continuously, reflecting actual conditions in the live environment rather than being based on maximum utilization. In summary, we can dynamically scale cloud environments up or down to achieve significant cost savings.

2. Specialization:Can Cloud Deployment Achieve Customization? You Might Think It’s a Pipe DreamIn traditional IT environments, we had to differentiate client environments to generate adaptive user interfaces, allowing users to customize their installations. In cloud environments, however, we aim to share instances among multiple tenants. It may seem that providing customized services for one user would undermine the application designed for everyone, but this is not the case. Software has become smarter, enabling a new form of customization in the cloud: it is data-driven rather than hard-coded, and cloud software is aware of multi-tenancy. We simulate customer profiles to configure databases. When User A logs in, we retrieve their configuration from the database to generate a color scheme and personalized content specific to A; User B receives a slightly different customized experience. All of this is driven by data, not by coding. This is the solution for customization in the cloud. Naturally, everything is moving in this direction, even within internal TurnKey solutions. From a development perspective, managing 20 branches of customized code is extremely painful: deployment becomes difficult without adequate testing, and every customer has unique requirements—it is simply a nightmare. Cloud computing offers a data-driven approach, fundamentally different from binary, either-or solutions.

3. Collaboration:I am not sure whether this is unique to cloud technology or simply the new norm. Google and Microsoft are providing truly great services that enable all applications to work together seamlessly. For instance, Microsoft Office 365 demonstrates collaboration built across the entire technology stack, with Microsoft and its partners committed to integrating the Office 365 experience into their applications. One of Invidays’ future tasks is to contribute to this effort. Although it is based on Lync components, we can enable direct support for Word in Office 365 by integrating a unified user account experience within our application. Users can create an online Word document, engage in real-time web-based collaboration, attract customer service representatives who are looking for specific data on their screens, and conduct online chats—all achieved through integration with Office 365. Thanks to the cloud availability of Office 365, this can be easily implemented at a low service cost. An all-inclusive monthly subscription model will replace existing pricing structures, allowing each company to access all necessary cloud-based services for just $18 per month. Monthly subscription pricing will also represent the future direction of pricing models, including in the healthcare IT industry.

What were the primary risks and challenges faced by suppliers in the period following 2015?

Over the past decade, the biggest challenge facing providers has been how to choose from the vast array of IT software available. With thousands of software vendors, many products from smaller companies fail to integrate seamlessly with managed care systems. For instance, when providers need to submit requests to a health plan, it is often difficult to truly reach the communication layer. A large number of intermediary service providers or clearinghouses have emerged like mushrooms after rain to serve providers. While they are traditional clearinghouses in name, their role extends far beyond that. They aggregate all providers into a single endpoint; a document retrieved from the clearinghouse no longer contains information from just one provider but encompasses data from all providers, thereby eliminating the need to establish point-to-point trading partner relationships. For health plans, clearinghouses can receive requests submitted by providers, standardize them, and ensure that the health plans can read and process them. Anyone who has handled EDI transactions knows that there is limited flexibility in interpreting data mapping. For example, it is often unclear whether a specific field should be placed in a particular segment or ignored. Under trading partner agreements, the clearinghouse assumes this responsibility, relieving providers of these cumbersome tasks. However, the key to solving the problem still lies in the point-to-point connection between providers and health plans. True communication between health plans and providers should be achieved, rather than merely maintaining a simple "acceptance-payment" model.

Historically, health plans needed to obtain specific diagnostic reports for patients from providers’ offices. Currently, however, the care teams of health plans only learn about patients’ conditions after a ten-day delay. If they had real-time notifications of this information, they could immediately collaborate with providers developing treatment plans. By enabling point-to-point connectivity between providers and health plans via the cloud, costs can be reduced. We have been exploring this possibility for 15 years. Empirically, providers are reluctant to spend heavily on IT requirements; however, an intermediary broker layer can facilitate communication with providers, making them more willing to invest in such solutions.

What Risks and Challenges Will Healthcare Institutions Face in 2015?

First: Money.No one offers a free and unrestricted communication middleware. In fact, such software is expensive. Our solution involves having health plans cover the service costs, enabling real-time communication, instant claim submission, and immediate reimbursement. Providers receive the software at no cost, with their interests fully safeguarded.

Second: Suppliers generally do not have IT personnel.For example, a massage therapist could set up a computer in his basement, install practice management software, and effectively double as an IT specialist. This situation must change. How can we achieve this? How can we prevent vendors from continuing to take on IT roles? One solution may be to shift services to the cloud, allowing them to purchase subscriptions on a monthly basis, rather than buying complete software and hardware packages for on-premises installation.

Third: Safety is another major hidden risk.All Protected Health Information (PHI) is regulated by the federal government through the HIPAA and HITECH Acts. Under these acts, it is illegal to disclose PHI data to unauthorized parties, whether intentionally or unintentionally: unintentional disclosures may result in substantial fines, while intentional disclosures can lead to criminal liability. Therefore, vendors and health plans must ensure that the cloud services they use comply with HIPAA and HITECH requirements. All data, whether at rest or in transit, must be encrypted according to established standards; specific authentication and authorization procedures must be implemented to prevent unauthorized access and data theft. Cloud service providers will handle security concerns on our behalf. For example, companies such as Amazon and Microsoft Azure provide cloud services to healthcare institutions and ensure that their file management, certification, and encryption processes are integrated into their security protocols. Both Amazon and Microsoft have stated that they will sign Business Associate Agreements (BAAs) with partners and assume responsibility for infrastructure-level security, thereby alleviating healthcare institutions from this burden.

What recommendations do you have for healthcare institutions to further deepen their adoption of cloud computing?

Healthcare organizations need to start experimenting with and adapting to cloud technology. A good starting point in this regard is upgrading from traditional desktop office software to the cloud-based versions of such products. Microsoft Office 365 is an excellent choice for institutions looking to try out cloud technology and save money in the long run. Instead of spending $600 to purchase a Microsoft Office license and setting up their own Exchange server to handle everything, they can now access the cloud-based equivalent for just $18 per month. This not only allows operation from any computer, anywhere, but also provides automatic, free updates with new features released by Microsoft. Through practical experience, healthcare organizations will discover that cloud services are neither intimidating nor difficult to implement. Subsequently, they will begin adopting other cloud solutions. Today, nearly every type of software you can think of offers a cloud service, including CRM, office software, IT monitoring software, and more.

We have less need to run internal software, as data and applications are safer and better protected in the cloud. Cloud software providers will manage hosted cloud solutions: your data will be backed up in the cloud, eliminating concerns about whether IT staff have performed backups; you also need not worry about server overload, as their capacity far exceeds that of your on-premises equipment; you only pay for the services you purchase. Furthermore, cloud operations are remarkably simple, freeing you from the need to dedicate specialized IT personnel to manage the entire suite of products, networks, and hardware. Of course, this does not mean you no longer need to hire IT staff, but it does allow you to streamline headcount in this area or reduce outsourcing. Adopting cloud services will definitely deliver a return on investment (ROI): direct ROI comes from no longer having to spend money maintaining physical hardware environments within data centers, while long-term ROI stems from no longer needing to employ a large number of IT personnel to manage 100 servers to maintain full-time equivalent (FTE) workload—a figure that could potentially be halved.

Recommendations

1. Contact cloud service providers dedicated to commercial software.Currently, many cloud service providers offer practice management systems. Apart from hardware configurations and specifications, there is no difference between enterprise cloud applications and TurnKey solutions; the underlying business processes and planning procedures are identical. Therefore, healthcare institutions should not assume that adopting cloud computing eliminates the need for specific implementation efforts. On the contrary, they still require comprehensive implementation plans to ensure uninterrupted service delivery. Healthcare institutions need to engage in negotiations and communications with relevant cloud technology vendors, obtain project proposals, and develop appropriate implementation plans.

2. Healthcare institutions must carefully vet their potential cloud computing solution providers.Many clients blindly select a medical IT product solution without conducting any due diligence. I recommend that they consult more existing user experiences before making a decision, evaluating the implementation status of the solution and whether any issues have arisen during service delivery.

3. You need to sign an SLA (Service Level Agreement) with your cloud computing solution provider.In cloud computing, you can no longer call your IT department and say, “It’s too slow; fix it.” Therefore, you need a written agreement to ensure you receive the service level you are entitled to.

Looking ahead, as existing TurnKey solutions become increasingly difficult to manage and costly, enterprises will ultimately find that this approach consumes more human resources and hardware. In this context, the adoption of cloud technologies will continue to grow, and only cloud service providers that can deliver consistent experiences and offer Service Level Agreements (SLAs) will survive in the fierce competition.

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