Tuesday, November 24, 2015

When is HIT spending enough to outdistance increased Revenues ?

Report: Health Care IT Payer Outsourcing Market To Increase by 40%

In the never ending race to become more efficient, reduce labor cost and become more competitive, have we reached the point of negative gain ?

, iHealthBeat, Tuesday, November 24, 2015
The market for health care IT payer outsourcing is projected to increase by 40% over the next two years, according to a new Black Book report, FierceHealthPayer reports (Moody, FierceHealthPayer, 11/23).

Report Details, Findings  

For the report, researchers surveyed 829 health plan IT outsourcing users from the second quarter of 2015 to Q4 2015 (Black Book release, 11/20).
The researchers attributed the projected growth in outsourcing to:
  • Software tools that have accelerated expenses faster than initially expected; and
  • Revenue increases (FierceHealthPayer, 11/23).
The report found health insurers in 2016 plan to increase their spending on outsourcing by at least 20% for certain service models and functions, such as:
  • Application support;
  • Desktop support; and
  • Help desk support.
In addition, about 80% of larger health plans could start outsourcing desktop support and help desk support with the next year, according to the report.
However, the researchers found that less than 10% of health plan IT executives have considered full or end-to-end outsourcing in part because of data security concerns (Black Book release, 11/20). Black Book noted that, as of January, about three-quarters of health plans surveyed were cautious about major outsourcing initiatives (FierceHealthPayer, 11/23).
The report authors wrote, "With concerns over hostile offshore locations and escalating health data security and privacy issues, fewer payers are entertaining having a third party overseas corporation between them and their IT nervous systems in 2016" (Black Book release, 11/20).
Meanwhile, the report also found that demand for big data and analytics to support population health initiatives will increase because of health plans' investment in:
  • Consumer-facing mobile applications;
  • Remote health monitoring; and
  • Virtual care (FierceHealthPayer, 11/23).
Source: iHealthBeat, Tuesday, November 24, 2015

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