Datica Blog

2014 Predictions - Growth of Healthcare Clouds

Travis Good, MD

Travis Good, MD

Co-founder, CEO & Chief Privacy Officer

February 4, 2014   Company HIPAA

Continuing well into 2014 with more detailed discussion of our predicted trends for the year. Increasingly technology vendors are looking to move applications and resources to cloud-based technologies. The reasons for cloud are well established:

  • Low capital spend
  • Flexible capacity scale up and down as needed
  • More time on apps and less on ops
  • Speed of deployments
  • Global reach
  • Flexibility in locations pick your data center locations regions

In healthcare, the biggest drivers of cloud-based technologies have been the small, but fast growing, number hosted EHR and PM vendors. The biggest in that category is Athena (not small), with companies like CareCloud, Kareo, PracticeFusion, and drchrono also included. These players will continue to grow in 2014; as an indication, Athena just unseated Epic as the #1 overall software vendor by KLAS after Epic had held the spot for the last 8 years. For those that don’t know, KLAS is the trusted rating system in the health IT industry.

These cloud based vendors, and new and emerging offerings around things like analytics, population health, digital engagement, and clinical communication, are making enterprises IT more comfortable sending data to the cloud and storing PHI data in the cloud. We talk to cloud-based health IT vendors all the time, and we’re astounded by the number of companies and products growing up to serve different segments of healthcare.

One of the other main drivers of cloud-based adoption in the enterprise is developers, which are coming into healthcare very rapidly. Developers are both inside and outside of the enterprise. On the healthcare enterprise side, it will be interesting to see how developers drive the adoption of cloud architecture, likely private cloud.

(image: chart.png)

Above are findings from a recent Forrester report on the growth of different sectors of cloud computing. Only about 8% of what is considered “private cloud” is actually cloud computing; it’s really just virtualized computing. And virtualized computing misses several of the key benefits of cloud computing listed above. Right in our backyard, the large data center project that Epic has underway in Verona, WI, will very likely be purely virtualized computing, and not meet the definitions for cloud computing, hence not have the benefits for customers.

But that’s not to say that other vendors won’t bring cloud computing to healthcare; it simply means do not believe everything you read about private clouds and enterprises. We predict there will be tremendous growth in 2014 of newer, non-EHR cloud-based tools, many of which will continue to grow beyond 2014 as healthcare evolves to meet growing demands on providers to manage risk.

Earlier

Accountable Care Organizations & Population Health Management

Look for partnerships and potentially mergers and acquisition activities as vendors look to get an edge in this burgeoning market.

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