The Easiest Way to Cut Costs (While Increasing Functionality) as a Healthcare CIO

SADA Says | Cloud Computing Blog

By SADA Says | Cloud Computing Blog

Healthcare CIOs face a new suite of challenges as their role evolves. As Mark Gilbert, research director for digital health at Gartner recently noted, healthcare CIOs are now being asked to support corporate growth and M&A activities, all while playing catch up to digitize their businesses (an activity that remains at a low stage of maturity within healthcare). What Gilbert doesn’t immediately mention is that healthcare CIOs are being tasked with tackling these next-generation responsibilities to upgrade their organizations while they continue to face a very old pressure—the mandate to cut costs every year.

No matter how much the healthcare CIO role advances, this cost-cutting pressure is not going away. As PwC recently explored, these industry-wide cost pressures are only accelerating. U.S. health expenditures are projected to increase by $3.5 trillion between 2010 and 2040, and healthcare spending within BRICS are projected to increase 117% over the next decade alone. To combat these rising costs, governments are leaning on the healthcare industry to produce “low-cost, efficient solutions”, adding further cost pressures to a healthcare industry that already loses $.25 for every dollar of revenue it takes in.

The net of it: healthcare organizations will continue to seek lowered expenses anywhere they can, which means healthcare CIOs will continue to be mandated to find ways to cut costs year-over-year, even as they are being asked to find ways to use technology to improve patient care, empower care teams, and bring more strategic value to their organization.

While this sounds like an impossible task, there is one clear area of investment that delivers both reduced costs and increased strategic value: switching to a HIPAA compliant email and collaboration platform that includes all of the typical tools healthcare organizations utilize under one roof.

Benefits of Moving  Your Healthcare Organization to a Cloud-Based Email and Collaboration Platform

At a base level, migrating to the right cloud platform will help most healthcare CIOs save a substantial amount of their budget for the cloud-based email, and collaboration functionality their organizations increasingly demand. To meet the demands of their users, most healthcare organizations have adopted one of two strategies:

First, many healthcare organizations feel stuck with the cloud provider they currently use for their email and collaboration functionality, and simply renew their contract with this provider year-over-year— despite the fact these providers often raise their prices with every new contract signing and don’t have much-needed updates for today’s workforce.

Second, an increasing number of healthcare CIOs have met their organizations’ demand for increased digital functionality via a “boutique” strategy, where they sign up for a new app for each new functionality their business stakeholders demand. They often sign up for one app for internal chat, another app for file storage, a third app for video conferencing, and so on. This leads to a complicated web of internal applications that are expensive to license individually (and rarely speak well with each other).

The right cloud-based email and collaboration platform solves both of these sources of creeping costs. The right platform is often much less expensive to license than either maintaining a legacy platform, or a plethora of individual apps. For example, a single G Suite license provides a full suite of cloud-based email and collaboration functionality, but costs the same as much as many single-function app licenses (approximately $5-$10 per user). In our experience, organizations are able to save between six to eight figures over five years simply by making this switch—all while maintaining full functionality, and often increasing the strategic value they provide to their business via expanded email, archiving, security, storage, and mobile device management, resulting in greater communication, collaboration, and productivity throughout the organization.

What Does a Real World Cost Savings and Improved Functionality in Healthcare Look Like?

It’s one thing to read about potential ways to reduce your cut costs by adopting a cloud-based collaboration platform. It’s another thing to hear from real companies that have experienced dramatic cost savings—and collaboration improvements—from making the switch. Here are one of our favorite example:

Hunterdon Healthcare is a U.S.-based healthcare organization with over 3,000 employees. Like many healthcare organizations, Hunterdon had accumulated a vast—and expensive—application portfolio over the years. They sought to simplify and modernize this portfolio, all while maintaining functionality without reducing costs.

Hunterdon Healthcare migrated to G Suite, for an estimated cost savings of $1.3 million per year on software licensing alone. Hunterdon eventually chose to migrate off their legacy systems, and onto G-Suite. We worked directly with their staff to ensure initial, and continued, adoption of their new tools. In addition to the $1.3 million annual savings projected once Hunterdon’s existing licenses expire, the organization expects to experience significant cost savings by moving data out of its existing data center and onto Google Drive—all while increasing their collaboration, workflow, and patient care. We have seen many healthcare companies experience a seven-figure annual savings by adopting a HIPAA-compliant email and collaboration platform.

Attending HIMSS? Join SADA and Google for customer panel discussion SCL Health and Lahey Health. The session will take place on Wednesday, March 7th at the Google Booth #2829 (Level 2) at 3:00pm. Both customers will share about their journey to G Suite and the benefits they have seen since implementation. Feel free to join us and hang around afterwards to chat with the speakers..


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