HealthData Management - February 2013

spent $3.5 billion on cloud technologies in 2011, or about 7 percent of the $53 billion the small business segment spent overall on I. T. expenditures.

Cautiously enthusiastic

That enthusiasm for remotely hosted services and low-cost infrastructure is shared by the health care industry, but not necessarily in the same way, or to the same degree, as industries such as construction or retail.

KLAS Enterprises, a Utah-based health care I. T. research firm, polled nearly 100 provider organizations for a 2011 “ perception” study of cloud computing. Right off the bat, Erik Westerlind, the report author, had to sift through how respondents—of which nearly 70 percent were C-level executives—defined cloud computing.

“We ran into a lot of cases where ex-
ecutives would tell us that yes, they use
the cloud because they’re having their
electronic health record remotely hosted
by Cerner, for example,” he says. “But
those types of services are not really how
“The Cloud” is typically defined outside
this market—yes, they’re remotely host-
ed, but the applications are running via
direct connections to Cerner’s data cen-
ter, and all their information is housed in
one place, Kansas City.”
Some of the confusion about how to
define cloud services is due to the “cloud
washing” going on—rebranding applica-
tion service provider or application host-
ing services as “cloud” solutions.

“True” cloud service is virtualized, elastic, scalable, metered out and resides on pooled or shared resources on the Web. Respondents mentioned every one of these attributes, but only a few mentioned them all, according to the KLAS report.

The health care execs most commonly used two attributes—an application was remotely hosted, and it was available via the Web—to define the cloud.

The bottom line is that interest in the
cloud is strong in health care, but neither
KLAS nor other industry experts expect a
stampede of providers to a public cloud
environment where their data is stored
and accessible via the public Web.

“There’s a
reluctance to
sign HIPAA
agreements.”
—Jeffrey White

quirement being that he certifies that he
knows where its data resides,” Westerlind
says. “In a public cloud that data could be
anywhere in the world. That pretty much
sums up why many are taking a cautious
approach to public cloud services.”
But then again, interest is high in cloud
computing, and 55 percent of respon-
dents to the KLAS survey are currently
deploying some part of their I. T. environ-
ment in the cloud, where the definition
was the delivery of storage solutions,
software solutions, or both over the Web.

At this point, much of the industry’s interest is focused on creating private clouds that enable providers to keep control of their data by either storing it on virtual servers they own, or putting it on dedicated virtual servers owned by trusted third parties.

A lot of the future of health care cloud computing hinges on trust. While much has been made of the reluctance of health care organizations to use the cloud, another roadblock has been the lack of cloud service providers willing to take on the burden of handling health care data, says Jeffrey White, a principal at Pittsburgh-based Aspen Advisors, a health care consultancy.

Market reluctance

“There’s been a reluctance on the part of cloud platform providers to sign HIPAA business associate agreements, which has really hampered the development of truly cloud-based services in the market,” White says.

As a result, many organizations are using hosting services from established health I. T. vendors, which provides some but not all of the benefits of a Web-based cloud environment. However, the cloud is coming, thanks in part to the health care industry’s increased focus on collaboration and consumerism.

Dignity Health provides a good example of how and why cloud computing is starting to carve out a health care space.

Dignity Health is massive, encompassing more than 40 hospitals, operating in 17 states, and with 60,000 providers working at its facilities. Not surprisingly, the health system has a large and skilled I.T. department and a massive technological infrastructure. But while it has the internal capability to meet pretty much any data demand thrown at it, Dignity Health is putting more and more information on a cloud platform managed by a third party, says Scott Whyte, the vice president of I. T. connectivity.

The impetus behind most of its cloud efforts is the need to collaborate with more and more business partners and provide additional services to physicians and patients. And those various projects need to be done yesterday.