Hospital executives are considering outsourcing more information technology services as a way to recoup losses and focus on core business functions in the wake of COVID-19, experts say.
By the end of 2020, the proportion of hospitals indicating interest in outsourcing had grown for 44 of 50 common clinical, financial and technology services when compared to before COVID-19, according to data from Black Book Research. The firm polled roughly 1,000 hospitals before the onset of the pandemic in February, and then again near the end of the year.
The six IT areas included in the survey all experienced an uptick in interest between February and November; none remained the same or experienced decreasing interest.
“Intention to (outsource) things that are primarily technology-associated really jumped,” said Doug Brown, Black Book’s founder and president.
That’s at least in part due to possible cost savings organizations could get from outsourcing. Hospitals in 2021 will have to work to replenish some of the revenue lost from low patient volumes in 2020, while also recognizing the need to invest in IT budgets to support virtual care, remote work and other innovations that spread during the pandemic.
That said, executives shouldn’t assume outsourcing will inherently be the most cost-effective option.
“Outsourcing is not something that’s always the cheapest option,” said Andrew Rebhan, expert partner for digital health intelligence at the Advisory Board. In fact, a larger health system might find it more cost effective to keep most of its IT management in-house, if it has the available staff and infrastructure, according to Rebhan.
Before deciding to outsource a service, Rebhan suggested hospitals conduct an audit of their current capabilities and how much it currently costs to run the intended service. That way, executives will know the baseline to compare possible contracts, as well as what specific metrics they’re aiming to improve.