Healthcare Technology Featured Article

December 26, 2012

Cloud Computing: Changing HIT and HIE Deployment Strategies



Many professionals dealing with personal health information see something akin to a flashing “danger” sign when someone mentions “the cloud.” Similar to its natural namesake, “the cloud” seems fuzzy and elusive and thus raises concerns about security. But “the cloud,” or “cloud computing,” as it’s formally referred to, offers many benefits that some healthcare organizations are already using to deploy health information technology across their enterprises. 

Cloud computing also enables revolutionary research accelerating the drug discovery process and lowering drug costs. Healthcare professionals need to worry less about the infrastructure of cloud computing, and focus more on understanding it as a new method for deploying technology, helping organizations to meet new requirements for data exchange and more coordinated, team-based care.

With proper safeguards, cloud computing offers powerful capabilities, especially when it comes to acquiring and managing health information technology (HIT) and extending data across the care continuum, what’s now commonly called health information exchange (HIE). Voices calling for greater data availability and use are reaching a fever pitch due to new payment systems and healthcare delivery reforms.

The goal of cloud computing is quite simple: provide scalable and easy-to-access computing resources and IT services. In fact, most people take advantage of cloud computing already (i.e., Gmail and other Web-based e-mail providers, Google Docs, DropBox, Evernote, Office365 and others). The General Services Administration recently awarded contracts to 17 companies to provide cloud-based e-mail to different federal, state, local and tribal agencies under the Cloud First Initiative. These technologies afford users free or low cost applications for e-mail and storage of documents and images accessible anytime and anywhere via the Internet.

For similar reasons, cloud computing is also appealing to healthcare organizations as they balance IT and staff budgets with increasing demands for a connected and patient-centered healthcare environment. Cloud computing offers economies of scale and resource pooling that enable cost effective storage and computing power for users across an enterprise and for organizations participating in an HIE.  

Across all industries, cloud computing services are considered the fastest growing segment of IT outsourcing worldwide, and are expected to grow 48.7% in 2012 to $5 billion, up from $3.4 billion in 2011. Healthcare is expected to see growth from $1.7 billion in 2011 to $5.4 billion by 2017—a compound annual growth rate of more than 20%. It’s really no longer a question of if healthcare will use cloud computing, but when.

So what exactly is cloud computing?

In the most basic sense, cloud computing refers to delivering hosted services over the Internet. The services tend to be divided into three categories: infrastructure-as-a-service (IaaS), platform-as-a-service (PaaS) and software-as-a-service (SaaS). The three service areas typically afford organizations an economical, innovative and agile way for hosting, building, delivering and accessing applications.

Cloud computing differs from traditional hosting options (i.e., client-server and application service provider) in that it is sold on-demand, is elastic and is managed fully by the cloud provider. This means organizations only pay for what they use, and they can leverage internal IT resources for strategy and management of mission-critical applications—most likely clinical and financial applications.     

Clouds come in public or private varieties. Some organization may opt for a variation commonly referred to as hybrid or community clouds. A public cloud sells services to anyone on the Internet; a private cloud is a data center or proprietary network that supplies hosted services to a restricted number of people. Most healthcare organizations—particularly large health systems—pursue a private cloud because it allows more customization and control over security features.

Gartner’s cloud computing criteria provide a helpful definition[1]:

1. Service-based. Interface is service based rather than technology focused.2. Scalable and Elastic. The service is scalable depending on client requirements.3. Shared. The infrastructure and resources of the software are shared for maximum efficiency.4. Metered by Use. Multiple payment methods are allowed based on tracked usage compared to the cost of set up or equipment.5. Uses Internet Technologies. The service is delivered using Internet identifiers, formats and protocols, such as URLs, HTTP, IP and representational state transfer Web-oriented architecture.

Cloud computing concerns

Adverse reactions to cloud computing stem primarily from the fact that it is new. And, if nothing else, people understand that someone else—the cloud technology company—maintains direct control of the applications and services delivered. It’s been particularly difficult for healthcare organizations to relinquish control because they believe cloud technology companies are not aligned with the evolving regulatory landscape. But cloud technology companies intent on making a serious footprint in healthcare have actually built the requisite capabilities for HIPAA compliance and they have improved security in general. It’s also worth noting that many of the top cloud providers are large, experienced technology companies.  

Oft-cited concerns about cloud technology include:

  • Service level agreements
  • Security
  • Compliance
  • Privacy
  • Governance
  • Lock-in (switching costs)
  • Business continuity
  • Loss of IT control and ownership
  • Enterprise and user inertia
  • Return on investment
  • Government snooping

But the benefits are equally compelling:

  • Improved IT responsiveness
  • Reductions in capital investments and operational overhead
  • Flexible on-demand services; pay as you go
  • Real-time collaboration
  • More time to focus on strategy
  • Taking advantage of new generation of innovative applications
  • Better security and compliance than with a poorly-run private infrastructure

Similar to other technology decisions, choosing a cloud technology provider boils down to due diligence in the selection process and the negotiation of the service level agreement (SLA). Healthcare organizations need to inquire about the company’s disaster-recovery strategy, backups, compliance with national health standards (e.g., HIPAA and state law requirements), migration plan from the existing IT infrastructure and security protocols and procedures. 

It is possible for healthcare organizations to negotiate effective SLAs if they take the time to understand the risks and benefits and pursue the right contract provisions to protect their patients’ data and their own data.

One of multiple options for deployment of HIT and HIE

It’s important to remember that cloud computing is just another method of implementation or deployment of technology and services. Cloud computing can be  used for  ancillary business applications (i.e., payroll management system, revenue cycle management systems patient billing tools), clinical applications like EHRs, computerized provider order entry systems and imaging technology or  myriad applications used to stand up an HIE. On a spectrum, cloud computing would be on the opposite end from the traditional client-server hosting option. 

There are other options between the two, and pros and cons to all of them. On one end, the healthcare organization is responsible for buying and maintaining all the hardware and software, and on the other end (cloud computing), an organization leverages hardware, software and/or Web services managed by someone else. 

The most natural fit for cloud computing and healthcare is probably the deployment of HIE. Cloud computing makes tasks like image sharing in an exchange environment possible. The massive storage space required for images is cost-prohibitive for smaller hospital systems. Offering radiology information system and picture archiving and communications system software in the cloud saves money and time. Organizations will pay less in storage fees and have to dedicate fewer IT staff for maintenance. Providers will have more timely access to the images and benefit from easier collaboration with other care providers who may also access the image simultaneously. 

Form a technical standpoint, cloud computing can offer such capabilities as the “split-merge.” This means the technology encrypts then strips PHI from imaging data before an image passes over the Internet. The technology then decrypts and re-matches patient identifiers if the image is forward to an authorized viewer. 

Perhaps most importantly, cloud computing in an HIE saves on interface expenses—the most costly. It has become more evident, as HIEs pursued sustainable business models, that the complexity and expense of integrating with every practice onboarding to an exchange was simply untenable.

The cloud and beyond

With the acceleration of new payment and healthcare delivery models like accountable care organizations and patient-centered medical homes, many healthcare organizations could find success with cloud computing. Areas like home health specifically will need new technology to gather, process and analyze data coming in from at-home monitors and telemetry. Cloud technology could accelerate capabilities and help providers proactively manage the health of a community, preventing hospital and even some clinic visits.

Cloud computing could help healthcare industry catch up to other industries in terms of IT use. Some healthcare organizations are already implementing cloud computing for such services as data sharing and archival storage. Emory Healthcare in Atlanta turned over many of its ancillary applications to the cloud and has since cut annual hardware, archival storage and Internet service provider costs by as much as 60 percent. The hospital now asks all vendors to deliver their Software-as-a-Service via the cloud.

The cloud originated mainly because many enterprise applications require too much maintenance and support. Costs were also spiraling up, and organizations needed solutions to avoid paying full price for using portions of applications installed onsite. Cloud computing is now enabling greater speed and access to data for healthcare providers and patients. Better anywhere, anytime access to cloud applications will enable more effective use of healthcare resources and more effective exchange of information among patient care professionals.







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