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There’s not a lot of specifics available yet in terms of how a new alliance between Amazon, JP Morgan Chase, and Berkshire Hathaway will lead to reduce healthcare costs for their employees. The assumption is that all three companies will leverage the IT prowess of Amazon to deliver healthcare services more efficiently to over one million employees that work for the combined companies.

Naturally, the prospect that three of the largest companies in the world plan to disrupt the healthcare industry shines a spotlight on the role IT plays in delivering healthcare services. That’s generally a good thing for managed services providers (MSPs) that focus on the healthcare sector that often lags other industries when it comes to adopting new applications and platforms.

The driving forces behind IT spend

A new limited survey of companies conducted by Damo Consulting that focuses on delivering applications and IT services to the healthcare industry finds 61 percent cite a lack of enterprise readiness on the part of customers as the primary obstacle when it comes to expanding their healthcare IT practices. In fact, that same number of respondents also cited the long sales cycle in healthcare as being the primary obstacle for achieving sales goals in 2018.

The two biggest drivers of healthcare IT spending are the shift to value-based care initiatives (61 percent) that focus on keeping people out of hospitals as much as possible and new patient/care management systems (58 percent). Digital business transformation (47 percent) and IT security (39 percent) were cited third and fourth respectively.

Because of these opportunities the survey finds a little over half of the respondents (53 percent) expect 10-30 percent growth, and just over a quarter (26 percent) expect to see growth of more than 30 percent growth in healthcare applications and services in 2018.

Opportunities for MSPs

That level of spending on IT would be transformational for the healthcare industry. Historically, healthcare providers have preferred to invest more in technologies that directly impact patient care. The IT systems employed are not much different than the billing and reservation systems typically employed by a hotel. Now it would appear that healthcare providers are finally gearing up to apply advanced analytics to all the data they collect. The challenge those organizations now face is most of them don’t have the skills and expertise required to operationalize that data. A very large percentage of them will need to rely on a MSP to both manage their data and serve up any actionable intelligence.

Achieving that goal, however, will also require healthcare organizations to modernize their data warehouses, most which today still run on dated relational database platforms. Modern data warehouses combine relational databases with Big Data platforms such as Hadoop to enable real-time analytics that can be employed, for example, to identify patients that have been given prescriptions for drugs that in combination create an acute side effect.

The healthcare industry has been making the transition to electronic records with mixed success for some time now. As painful as that process may have been it may appear that with a little help from MSPs and the rise of AI-infused analytics applications the healthcare industry may finally be positioned to recoup that investment.

Photo: Khakimullin Aleksandr / Shutterstock.

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Mike Vizard

Posted by Mike Vizard

Mike Vizard has covered IT for more than 25 years, and has edited or contributed to a number of tech publications including InfoWorld, eWeek, CRN, Baseline, ComputerWorld, TMCNet, and Digital Review. He currently blogs for IT Business Edge and contributes to CIOinsight, The Channel Insider, Programmableweb and Slashdot. Mike blogs about emerging cloud technology for Smarter MSP.

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