Health IT outsourcing vendors struggle to satisfy providers

Black Book Research finds hospitals, group practices still want outside help, Doug Brown says.

Hospitals and physician practices have mixed perceptions of the value of IT services outsourced to external vendors, according to a survey by a research firm specializing in healthcare IT products and services.

The poll of 1,587 executives whose organizations have contracts with healthcare information technology outsourcing vendors found that a large percentage aren’t highly satisfied with the services they are getting. The research was conducted by Black Book Research between March and August.

However, the organizations aren’t dropping vendors, and the decline in overall satisfaction is not leading to a decline in outsourcing. Many respondents are expanding use of outsourcing—82 percent of surveyed hospitals have signed IT departmental outsourcing contracts since the third quarter of 2016 or are selecting a vendor, Black Book reports.

Respondents included 807 hospital CIOs and other IT departmental leaders, 89 chief financial officers, and other financial executives. In total, respondents represented 244 hospital and inpatient organizations and 798 physician practices.

Only seven vendors out of 68 companies offering outsource services received the best scores for exceeding expectations on all 18 key performance indicators in the survey. By contrast, 17 vendors who respondents judged as superior in 2015 were judged as “slipping” this year.

Some 40 percent of respondents said their outsource partner met expectations; 39 percent said they believe the vendor fell below expectations; and only 10 percent judged the vendor as exceeding expectations. Another 10 percent said it was too soon in the relationship to render an opinion.

Also See: Rising data security threats drive growth in outsourcing

For surveyed CIOs, the biggest benefit of outsourcing is reduced time spent dealing with infrastructure. A lack of funding for infrastructure to secure IT facilities is contributing to the growth of outsourcing while enabling healthcare organizations to focus on their core businesses.

“Doing business with firms with insufficient healthcare experience that are not knowledgeable is extremely risky,” says Doug Brown, managing partner at Black Book. “The successful client/vendor relationship depends on the healthcare provider experience to ensure efficient connectivity between IT, clinical care and business workflows.”

Surveyed healthcare organizations identified several vendors as high achievers. Cerner, Meditech and Allscripts scored highest in IT managed services for providers among companies offering electronic health records systems.

Phoenix Health Systems, ICE Technologies, CGS Healthcare Solutions, Infinite Outsourcing Solutions, IBM, NTT Data and CareTech Solutions scored highest among non-EHR outsourcing vendors.

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