Cloud Computing in Healthcare
Content
Corporate Marketing White paper
Healthcare
Cloud Computing in Healthcare: Path to Efficiency and Innovation
2
Cloud Computing in Healthcare: Path to Efficiency and Innovation
Table of contents
2 Executive summary 3 The potential of cloud – What does cloud offer? 4 Taking advantage of cloud technology for agility and efficiency – Hospitals and physicians – Health plans and insurers 8 Building your cloud strategy 9 Change is possible. The tools exist today.
Executive summary
The healthcare industry is in a period of accelerating change that requires continual innovation. The chronic disease epidemic, changing population demographics and advancements in medical technologies are key contributors to escalating costs. All stakeholders expect more value for their money. And, patients are beginning to play greater roles in managing their care. Driven by economics, emerging care and business models aligned with personal values and well-being are signaling a major shift in how healthcare organizations will compete and operate in the years ahead. At the same time, healthcare organizations, whether they are hospitals, physicians or health insurers, need to lower administrative costs and boost efficiency while increasing business flexibility. A recent CEO Study conducted by IBM revealed that 34 percent of healthcare provider CEOs are focused on simplifying operations to manage complexity more effectively.1 Similarly, 55 percent of healthcare payer CEOs believe that their organizations are ready for the impending complexity. Yet most recognize there is a new environment in which they have to operate.2
Healthcare
3
This paper is part of a series that addresses the potential for cloud computing in the healthcare industry. It explains how cloud computing can address key business challenges facing healthcare today. It also suggests how organizations can take advantage of this evolving technology to establish the flexible digital foundation needed to drive innovation.
Costly processes and systems and growing IT complexity threaten to hold organizations back. A more flexible and scalable approach to applications and infrastructure can help them support new care delivery and business approaches. Cloud computing offers new and flexible ways to provision, manage and pay for technology resources. It can help organizations to address barriers standing in the way of adopting new, more efficient business models.
The potential of cloud
Regardless of segment, the healthcare industry is facing a multitude of issues (Figure 1).
What does cloud offer?
Strong need for cost reduction Strong need for operating efficiencies and increased productivity Need to automate care delivery processes and systems Need to modernize legacy applications and systems Comply with regulations and security mandates Use data to analyze and improve clinical and business performance Expand access to care Transition from reactive to proactive care Demonstrate greater healthcare value to all stakeholders Need for business model innovation to improve sustainability
Cloud computing is a general term for anything that involves the delivery of technology over the Internet. It is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (for example, networks, systems, applications and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction.3 It is characterized by:
• • •
Figure 1: Healthcare industry issues
•
On-demand self-service Ever-present network access to computing resources Rapid and elastic provisioning with minimal management effort or service provider interaction Pay-per-use
4
Cloud Computing in Healthcare: Path to Efficiency and Innovation
Cloud computing changes the delivery of IT services in much the same way that ATMs changed banking, Amazon.com and iTunes have changed the music and entertainment industry and the Internet transformed commerce. Its overall goal is to manage complexity more effectively, using simplification to speed the deployment of new capabilities that can enable innovation. For more information about cloud computing, see the IBM White Paper, “Cloud Computing: Building a New Foundation for Healthcare.”
Healthcare organizations are currently drawn to cloud computing because it can help reduce IT costs and speed service and infrastructure availability. Although cloud computing has been associated more with infrastructure, the ability to generate new business value in terms of process innovation and significant cost savings is on the horizon. Cloud computing provides a platform for business-to-business and business-to-consumer collaboration and can enable healthcare organizations to focus on differentiating activities as distinct from transactional processes.
Hospitals and physicians
Hospitals and physician practices are experiencing capital and cost constraints and resource shortfalls driven by multiple factors that include inefficient processes and the IT investments needed to support growth, regulatory mandates and new approaches to care. The isolated clinical and business processes found in so many hospitals are becoming roadblocks to progress, adding cost and complexity. Increasing system and network service requirements, low utilization of IT tools and rising operational costs are familiar issues. Cloud computing can provide cost-effective ways for hospitals and physician practices to expand IT capacity, accelerate deployment of new application environments and promote electronic health records (EHRs), while protecting data on mobile devices, reducing costs and improving clinical and administrative efficiency and productivity.
Taking advantage of cloud technology for agility and efficiency
Businesses have different motivations for using cloud computing (Figure 2).
An enabler of business transformation Businessfocused • • • • Creating new business models Enabling speed and innovation Reengineering business process Supporting new levels of collaboration Transformation
An evolution of information technology IT-focused • • • • Changing the economics of IT Automating service delivery Radically exploiting standardization Rapidly deploying new capabilities Efficiencies
Figure 2: Motivations for cloud
Healthcare
5
Hospitals and physician practices need easier ways to capture and store electronic health records and medical images. In the United States, the American Recovery and Reinvestment Act provides financial incentives to organizations that buy and use EHRs, yet it does not cover the full cost for many providers. Cloud-delivered approaches help solve this problem. Cloud can help deploy EHRs more quickly. With cloud, EHR payments can be made over time so that no big, upfront capital investments are needed. Doctors can focus on patient care while their cloud services provider manages the technology behind delivery. Cloud offers the opportunity to expand IT capacity quickly without major outlays. One example is storage capacity. A modest 100-bed hospital will generate approximately 60 GB of new digital content per bed per year, requiring at least an additional 6 TB of storage space annually. Cloud-delivered IT resources can help address the need for economical storage expansion, eliminating the need to continue buying and supporting in-house storage systems, lowering costs and helping with storage management.
Business continuity and high availability are increasingly important elements of electronic health record deployments and regulatory compliance. Cloud-delivered infrastructure services can help improve the efficiency of IT processes such as IT help desks and data backup and meet regulatory requirements for medical records retention. At the same time, they provide scalable compute and development environments for compute-intensive research projects like those conducted by academic medical centers. IBM’s security and risk solutions can help build secure clouds and deliver security services from the IBM cloud. For example, healthcare organizations can implement a private storage cloud and use IBM Information Protection Services – Managed Backup Cloud to deliver it securely. Cloud computing can further help hospitals and physicians accelerate deployment of new applications or expand IT infrastructure capabilities to accommodate sudden business growth and change. In fact, a recent IBM-sponsored survey shows IT professionals predicting that mobile and cloud computing will emerge as the most in-demand platforms for software application development and IT delivery over the next five years.4 For many organizations, cloud computing offers new capabilities that don’t require the IT staff historically needed to service and maintain infrastructure. By eliminating the upfront expense and headaches associated with infrastructure growth and maintenance, IT staffs are free to adopt new technologies that support strategic business projects such as EHRs.
6
Cloud Computing in Healthcare: Path to Efficiency and Innovation
Mobility is critical to providing health services at the point of care, in the patient room, the skilled nursing facility or even at home. The benefits of optimized mobility solutions can be both financial and clinical. Of course, unmanaged mobility in healthcare has risks, because mobile devices loaded with sensitive patient data can be lost or stolen. Competent device management is critical to success. Cloud-based approaches can enable safe and secure mobile access, improved workflow, more satisfied staff and better care, all while securing sensitive data. With cloud-based storage, data is never stored on mobile devices, eliminating the chance that protected health information (PHI) will be compromised on a user device.
Desktop virtualization from the cloud can improve efficiency and provide anytime, anywhere access to healthcare applications, information and resources without the added burden of adding staff for system management. Moving applications from desktops into a centralized, hosted environment can lead to better accessibility, manageability and security. IBM’s desktop virtualization solutions can help organizations quickly scale their IT infrastructures and boost information accessibility, improving workflow, data access and satisfaction, while reducing complexity, energy consumption and cost. Cloud-delivered approaches can also improve staff productivity by helping automate, streamline and manage simple administrative processes. University College London Hospitals NHS Foundation Trust (UCLH), one of the largest NHS (National Health Service) trusts in the UK, elected to use business process management (BPM) capabilities from IBM WebSphere® Lombardi® Edition to develop a comprehensive Patient Tracking System (PTS). The BPMbased PTS enables UCLH to model patient pathways and link directly to those core IT systems that hold information about patient appointments, diagnostic tests and treatment so that when treatment is first administered, whether therapeutic or a period of advised observation, this is all noted and managed.
A large medical school deployed a private cloud from IBM to centralize management of desktops used by investigators using an enterprise-class data center rather than at user stations, gaining greater control of application configurations and increased controls over PHI data.
Healthcare
7
In short, hospitals and physician practices are feeling the pressure to extract greater value from limited financial, human and IT resources. Cloud-delivered capabilities can make it possible to use only the resources necessary to support administrative and IT operations at any given moment. This flexibility translates into reduced costs, better efficiency and productivity and increased ability to focus on differentiating initiatives.
Health plans and health insurers
Health plans and insurers are struggling with inefficient administrative processes, inflexible systems, increasing medical costs, new business models like Patient Centered Medical Home and a steady stream of regulatory changes that require significant investments to implement. Nine out of 10 healthcare payer CEOs believe the environment will be more difficult over the next five years, further complicating how they will manage and thrive.5
Cloud-delivered capabilities can help to improve health plan and health insurer business process efficiency. IBM Blueworks Live is a cloud-based business process management tool used to discover, design, automate and manage business processes. With capabilities that allow a business person with little technical skill to automate processes, it can result in more control and improved productivity using a social, collaborative approach. It is an effective tool for building new approaches to customer service. Improving customer service is a priority for many health plans and insurers, who might relate to the experience of a prominent call center client. This client expanded its cloud computing initiative, which has already reduced the company’s desktop PC operating costs by 50 percent. Benefits can go beyond operational expense reduction to improve service quality. Cloud-delivered approaches can increase business flexibility by expanding IT capacity and resources at lower cost and, in many cases, providing superior service quality. While initiatives to modernize core claims systems have historically been viewed as expensive with limited ROI, cloud-delivered infrastructure services can facilitate and accelerate claims systems migration and modernization projects, enabling faster time to value and improving return on investment.
8
Cloud Computing in Healthcare: Path to Efficiency and Innovation
IBM Smart Business Development and Test Cloud provides a security-rich, standardized test and development environment that helps reduce test cycle times, complexity and risks. This capability could accelerate transition to ICD-10. Benefits include a possible reduction of capital and licensing expenses by as much as 50 to 75 percent, using virtualized resources. By automating development and test resource configurations, health plans and health insurers have an opportunity to reduce operating and labor costs as much as 30 to 50 percent.6 Like hospitals, health plans and insurers can also take advantage of cloud-delivered storage capacity to house their burgeoning information stores. Cloud-delivered infrastructure services such as managed backup services can help improve IT backup efficiency and meet regulatory requirements for data retention. Software services in IBM Tivoli® Live - service manager7 can enable better automation and control of IT service desk functions – functions that are critical to maintaining business operations.
Healthcare collaboration in the cloud Hospitals, physicians, health plans and health insurers can take advantage of cloud-based collaboration tools. IBM LotusLive™ provides cloud-delivered business services that help people connect and collaborate beyond the boundaries of their own organizations. A multinational medical supply company in Switzerland is using LotusLive as a collaboration hub and to track project tasks for the effort to fight malaria in sub-Saharan Africa. A drug inventory monitoring solution captures current stock levels of combination therapy and quinine drugs. Drug suppliers, state officials and other logistics organizations can then access these records, using a tabular, web-based interface that maps existing supplies to geographic locations. The LotusLive solution enables comprehensive, inexpensive weekly reporting for every medical facility in a district and promotes improved malaria epidemic detection.
Healthcare
9
Building your cloud strategy
The successful infusion of cloud into your business strategy, including focused pilots, can accelerate IT cost reduction and speed service and infrastructure availability. In our experience, the best cloud strategies are workload-driven. Figure 3 shows examples of workloads that can be moved to the cloud to help reduce capital expenditures, operational costs and risk and to produce better quality of service and increased agility.
IBM Research demonstrates private test cloud cost savings IBM Research has studied the cost savings of private test clouds by analyzing comparable application testing services. One used a private test cloud and other used the current application testing IT environment. Both environments had the same level of IT support for both environments. They discovered: • Hardware savings of 65 percent from reduced infrastructure and improved hardware utilization • Software savings of 27 percent from lower license costs and improved utilization • System administration savings of 45 percent from reduced system administration and operation costs • Provisioning savings of 76 percent from labor savings in service request management
Process Automation and Optimization Secure Mobile Desktops and Devices Efficient PC Refresh Cycle IT Service Help Desk Long-term Data Archival Development and Test Environments Business Continuity and Disaster Recovery Security Capacity for Compute-intensive Research Compute and Storage for Peak Demands Legacy Modernization IT Simplification
Figure 2: Workload examples
10
Cloud Computing in Healthcare: Path to Efficiency and Innovation
Change is possible. The tools exist today
IBM can help you assess and plan cloud adoption. We can help develop business and care delivery strategies, extend IT optimization strategies and build a roadmap. Our roadmap methodology can help you understand not only which cloud strategy meets your needs but also which service is best suited for delivering specific clinical and business use cases. In realizing lower operational costs, increased agility and faster time to market by using cloud computing, healthcare organizations can dedicate more focus on initiatives leading to healthcare innovation.
What IBM offers healthcare organizations • Clear economic value. IBM helps you work through the right mix of delivery models and choices to reap the maximum benefit. An innovative healthcare organization shared lessons gained from an IBM CloudBurst™ (infrastructure as a service) implementation that introduced a pay-as-you-go model to increase project flexibility and allocate freed up resources to other high-value activities. The investment in cloud computing required creativity and a strong commitment to realize benefits. • Integrated and open solutions. IBM actively supports healthcare standards development, working with policy makers, building consensus and delivering unique, innovative new technologies. IBM initiated a community-based effort to drive new standards for cloud computing. Our open standards approach encourages a broader ecosystem, including developers, independent software vendors and resellers, which can lead to collaborative partnerships that will be critical to the deployment and success of healthcare cloud platforms. • Secure solutions that are ready for business. The IBM Security Framework and Blueprint provide a comprehensive method for addressing all aspects of security and an equally comprehensive portfolio of security offerings and services. IBM is working to implement secure delivery models, deploying platforms for industry clouds that are “secure by design” so that when healthcare organizations or communications services providers deliver services, they can trust that their services are not compromised. In addition, IBM Research is helping clients navigate and manage the cloud security landscape. • Designing for simplicity. From sourcing to usage to maintenance, IBM cloud solutions are simple, intuitive and designed for how healthcare organizations actually work. • Globally relevant. We’ve established 11 global cloud computing laboratories to help local organizations, governments and research institutions design, adopt and reap the benefits of cloud technologies. Each lab serves as a gateway for local clients to tap into the knowledge of IBM software, services and research labs around the world.
Healthcare
11
© Copyright IBM Corporation 2011 IBM Corporation Route 100 Somers, NY 10589 U.S.A. Produced in the United States of America February 2011 All Rights Reserved IBM, the IBM logo, ibm.com, Cloudburst, LotusLive, Tivoli and WebSphere are trademarks or registered trademarks of International Business Machines Corporation in the United States, other countries, or both. If these and other IBM trademarked terms are marked on their first occurrence in this information with a trademark symbol (® or ™), these symbols indicate U.S. registered or common law trademarks owned by IBM at the time this information was published. Such trademarks may also be registered or common law trademarks in other countries. A current list of IBM trademarks is available on the Web at “Copyright and trademark information” at ibm.com/legal/copytrade.shtml Lombardi® device, Lombardi Blueprint®, Lombardi Blueprint® device, Lombardi Services® device, Lombardi Software®, Lombardi Teamworks®, Lombardi University® device, and Teamworks® are trademarks or registered trademarks of Lombardi Software, Inc., an IBM Company. Other company, product, or service names may be trademarks or service marks of others.
1 2 3 4 5 6 2010 IBM CEO Study, IBM Global Business Services 2010 IBM CEO Study, IBM Global Business Services Source: US National Institute of Standards and Technology, Information Technology Laboratory IBM Survey: IT Professionals Predict Mobile and Cloud Technologies Will Dominate Enterprise Computing By 2015 2010 IBM CEO Study, IBM Global Business Services Based on results from IBM’s Technology Adoption Program, in which an internal “Collaboration Innovation” cloud was developed using IBM technology. The solution has more than 100,000 participants. Results vary depending on the customer’s existing environment. Final results can only be ascertained after an ROI analysis. IBM’s New Cloud Offering Helps Companies Improve IT Service Desk Operations: http://www-03.ibm.com/press/us/en/pressrelease/33178.wss
7
Please Recycle
GIW03017-USEN-01
Healthcare
Cloud Computing in Healthcare: Path to Efficiency and Innovation
2
Cloud Computing in Healthcare: Path to Efficiency and Innovation
Table of contents
2 Executive summary 3 The potential of cloud – What does cloud offer? 4 Taking advantage of cloud technology for agility and efficiency – Hospitals and physicians – Health plans and insurers 8 Building your cloud strategy 9 Change is possible. The tools exist today.
Executive summary
The healthcare industry is in a period of accelerating change that requires continual innovation. The chronic disease epidemic, changing population demographics and advancements in medical technologies are key contributors to escalating costs. All stakeholders expect more value for their money. And, patients are beginning to play greater roles in managing their care. Driven by economics, emerging care and business models aligned with personal values and well-being are signaling a major shift in how healthcare organizations will compete and operate in the years ahead. At the same time, healthcare organizations, whether they are hospitals, physicians or health insurers, need to lower administrative costs and boost efficiency while increasing business flexibility. A recent CEO Study conducted by IBM revealed that 34 percent of healthcare provider CEOs are focused on simplifying operations to manage complexity more effectively.1 Similarly, 55 percent of healthcare payer CEOs believe that their organizations are ready for the impending complexity. Yet most recognize there is a new environment in which they have to operate.2
Healthcare
3
This paper is part of a series that addresses the potential for cloud computing in the healthcare industry. It explains how cloud computing can address key business challenges facing healthcare today. It also suggests how organizations can take advantage of this evolving technology to establish the flexible digital foundation needed to drive innovation.
Costly processes and systems and growing IT complexity threaten to hold organizations back. A more flexible and scalable approach to applications and infrastructure can help them support new care delivery and business approaches. Cloud computing offers new and flexible ways to provision, manage and pay for technology resources. It can help organizations to address barriers standing in the way of adopting new, more efficient business models.
The potential of cloud
Regardless of segment, the healthcare industry is facing a multitude of issues (Figure 1).
What does cloud offer?
Strong need for cost reduction Strong need for operating efficiencies and increased productivity Need to automate care delivery processes and systems Need to modernize legacy applications and systems Comply with regulations and security mandates Use data to analyze and improve clinical and business performance Expand access to care Transition from reactive to proactive care Demonstrate greater healthcare value to all stakeholders Need for business model innovation to improve sustainability
Cloud computing is a general term for anything that involves the delivery of technology over the Internet. It is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (for example, networks, systems, applications and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction.3 It is characterized by:
• • •
Figure 1: Healthcare industry issues
•
On-demand self-service Ever-present network access to computing resources Rapid and elastic provisioning with minimal management effort or service provider interaction Pay-per-use
4
Cloud Computing in Healthcare: Path to Efficiency and Innovation
Cloud computing changes the delivery of IT services in much the same way that ATMs changed banking, Amazon.com and iTunes have changed the music and entertainment industry and the Internet transformed commerce. Its overall goal is to manage complexity more effectively, using simplification to speed the deployment of new capabilities that can enable innovation. For more information about cloud computing, see the IBM White Paper, “Cloud Computing: Building a New Foundation for Healthcare.”
Healthcare organizations are currently drawn to cloud computing because it can help reduce IT costs and speed service and infrastructure availability. Although cloud computing has been associated more with infrastructure, the ability to generate new business value in terms of process innovation and significant cost savings is on the horizon. Cloud computing provides a platform for business-to-business and business-to-consumer collaboration and can enable healthcare organizations to focus on differentiating activities as distinct from transactional processes.
Hospitals and physicians
Hospitals and physician practices are experiencing capital and cost constraints and resource shortfalls driven by multiple factors that include inefficient processes and the IT investments needed to support growth, regulatory mandates and new approaches to care. The isolated clinical and business processes found in so many hospitals are becoming roadblocks to progress, adding cost and complexity. Increasing system and network service requirements, low utilization of IT tools and rising operational costs are familiar issues. Cloud computing can provide cost-effective ways for hospitals and physician practices to expand IT capacity, accelerate deployment of new application environments and promote electronic health records (EHRs), while protecting data on mobile devices, reducing costs and improving clinical and administrative efficiency and productivity.
Taking advantage of cloud technology for agility and efficiency
Businesses have different motivations for using cloud computing (Figure 2).
An enabler of business transformation Businessfocused • • • • Creating new business models Enabling speed and innovation Reengineering business process Supporting new levels of collaboration Transformation
An evolution of information technology IT-focused • • • • Changing the economics of IT Automating service delivery Radically exploiting standardization Rapidly deploying new capabilities Efficiencies
Figure 2: Motivations for cloud
Healthcare
5
Hospitals and physician practices need easier ways to capture and store electronic health records and medical images. In the United States, the American Recovery and Reinvestment Act provides financial incentives to organizations that buy and use EHRs, yet it does not cover the full cost for many providers. Cloud-delivered approaches help solve this problem. Cloud can help deploy EHRs more quickly. With cloud, EHR payments can be made over time so that no big, upfront capital investments are needed. Doctors can focus on patient care while their cloud services provider manages the technology behind delivery. Cloud offers the opportunity to expand IT capacity quickly without major outlays. One example is storage capacity. A modest 100-bed hospital will generate approximately 60 GB of new digital content per bed per year, requiring at least an additional 6 TB of storage space annually. Cloud-delivered IT resources can help address the need for economical storage expansion, eliminating the need to continue buying and supporting in-house storage systems, lowering costs and helping with storage management.
Business continuity and high availability are increasingly important elements of electronic health record deployments and regulatory compliance. Cloud-delivered infrastructure services can help improve the efficiency of IT processes such as IT help desks and data backup and meet regulatory requirements for medical records retention. At the same time, they provide scalable compute and development environments for compute-intensive research projects like those conducted by academic medical centers. IBM’s security and risk solutions can help build secure clouds and deliver security services from the IBM cloud. For example, healthcare organizations can implement a private storage cloud and use IBM Information Protection Services – Managed Backup Cloud to deliver it securely. Cloud computing can further help hospitals and physicians accelerate deployment of new applications or expand IT infrastructure capabilities to accommodate sudden business growth and change. In fact, a recent IBM-sponsored survey shows IT professionals predicting that mobile and cloud computing will emerge as the most in-demand platforms for software application development and IT delivery over the next five years.4 For many organizations, cloud computing offers new capabilities that don’t require the IT staff historically needed to service and maintain infrastructure. By eliminating the upfront expense and headaches associated with infrastructure growth and maintenance, IT staffs are free to adopt new technologies that support strategic business projects such as EHRs.
6
Cloud Computing in Healthcare: Path to Efficiency and Innovation
Mobility is critical to providing health services at the point of care, in the patient room, the skilled nursing facility or even at home. The benefits of optimized mobility solutions can be both financial and clinical. Of course, unmanaged mobility in healthcare has risks, because mobile devices loaded with sensitive patient data can be lost or stolen. Competent device management is critical to success. Cloud-based approaches can enable safe and secure mobile access, improved workflow, more satisfied staff and better care, all while securing sensitive data. With cloud-based storage, data is never stored on mobile devices, eliminating the chance that protected health information (PHI) will be compromised on a user device.
Desktop virtualization from the cloud can improve efficiency and provide anytime, anywhere access to healthcare applications, information and resources without the added burden of adding staff for system management. Moving applications from desktops into a centralized, hosted environment can lead to better accessibility, manageability and security. IBM’s desktop virtualization solutions can help organizations quickly scale their IT infrastructures and boost information accessibility, improving workflow, data access and satisfaction, while reducing complexity, energy consumption and cost. Cloud-delivered approaches can also improve staff productivity by helping automate, streamline and manage simple administrative processes. University College London Hospitals NHS Foundation Trust (UCLH), one of the largest NHS (National Health Service) trusts in the UK, elected to use business process management (BPM) capabilities from IBM WebSphere® Lombardi® Edition to develop a comprehensive Patient Tracking System (PTS). The BPMbased PTS enables UCLH to model patient pathways and link directly to those core IT systems that hold information about patient appointments, diagnostic tests and treatment so that when treatment is first administered, whether therapeutic or a period of advised observation, this is all noted and managed.
A large medical school deployed a private cloud from IBM to centralize management of desktops used by investigators using an enterprise-class data center rather than at user stations, gaining greater control of application configurations and increased controls over PHI data.
Healthcare
7
In short, hospitals and physician practices are feeling the pressure to extract greater value from limited financial, human and IT resources. Cloud-delivered capabilities can make it possible to use only the resources necessary to support administrative and IT operations at any given moment. This flexibility translates into reduced costs, better efficiency and productivity and increased ability to focus on differentiating initiatives.
Health plans and health insurers
Health plans and insurers are struggling with inefficient administrative processes, inflexible systems, increasing medical costs, new business models like Patient Centered Medical Home and a steady stream of regulatory changes that require significant investments to implement. Nine out of 10 healthcare payer CEOs believe the environment will be more difficult over the next five years, further complicating how they will manage and thrive.5
Cloud-delivered capabilities can help to improve health plan and health insurer business process efficiency. IBM Blueworks Live is a cloud-based business process management tool used to discover, design, automate and manage business processes. With capabilities that allow a business person with little technical skill to automate processes, it can result in more control and improved productivity using a social, collaborative approach. It is an effective tool for building new approaches to customer service. Improving customer service is a priority for many health plans and insurers, who might relate to the experience of a prominent call center client. This client expanded its cloud computing initiative, which has already reduced the company’s desktop PC operating costs by 50 percent. Benefits can go beyond operational expense reduction to improve service quality. Cloud-delivered approaches can increase business flexibility by expanding IT capacity and resources at lower cost and, in many cases, providing superior service quality. While initiatives to modernize core claims systems have historically been viewed as expensive with limited ROI, cloud-delivered infrastructure services can facilitate and accelerate claims systems migration and modernization projects, enabling faster time to value and improving return on investment.
8
Cloud Computing in Healthcare: Path to Efficiency and Innovation
IBM Smart Business Development and Test Cloud provides a security-rich, standardized test and development environment that helps reduce test cycle times, complexity and risks. This capability could accelerate transition to ICD-10. Benefits include a possible reduction of capital and licensing expenses by as much as 50 to 75 percent, using virtualized resources. By automating development and test resource configurations, health plans and health insurers have an opportunity to reduce operating and labor costs as much as 30 to 50 percent.6 Like hospitals, health plans and insurers can also take advantage of cloud-delivered storage capacity to house their burgeoning information stores. Cloud-delivered infrastructure services such as managed backup services can help improve IT backup efficiency and meet regulatory requirements for data retention. Software services in IBM Tivoli® Live - service manager7 can enable better automation and control of IT service desk functions – functions that are critical to maintaining business operations.
Healthcare collaboration in the cloud Hospitals, physicians, health plans and health insurers can take advantage of cloud-based collaboration tools. IBM LotusLive™ provides cloud-delivered business services that help people connect and collaborate beyond the boundaries of their own organizations. A multinational medical supply company in Switzerland is using LotusLive as a collaboration hub and to track project tasks for the effort to fight malaria in sub-Saharan Africa. A drug inventory monitoring solution captures current stock levels of combination therapy and quinine drugs. Drug suppliers, state officials and other logistics organizations can then access these records, using a tabular, web-based interface that maps existing supplies to geographic locations. The LotusLive solution enables comprehensive, inexpensive weekly reporting for every medical facility in a district and promotes improved malaria epidemic detection.
Healthcare
9
Building your cloud strategy
The successful infusion of cloud into your business strategy, including focused pilots, can accelerate IT cost reduction and speed service and infrastructure availability. In our experience, the best cloud strategies are workload-driven. Figure 3 shows examples of workloads that can be moved to the cloud to help reduce capital expenditures, operational costs and risk and to produce better quality of service and increased agility.
IBM Research demonstrates private test cloud cost savings IBM Research has studied the cost savings of private test clouds by analyzing comparable application testing services. One used a private test cloud and other used the current application testing IT environment. Both environments had the same level of IT support for both environments. They discovered: • Hardware savings of 65 percent from reduced infrastructure and improved hardware utilization • Software savings of 27 percent from lower license costs and improved utilization • System administration savings of 45 percent from reduced system administration and operation costs • Provisioning savings of 76 percent from labor savings in service request management
Process Automation and Optimization Secure Mobile Desktops and Devices Efficient PC Refresh Cycle IT Service Help Desk Long-term Data Archival Development and Test Environments Business Continuity and Disaster Recovery Security Capacity for Compute-intensive Research Compute and Storage for Peak Demands Legacy Modernization IT Simplification
Figure 2: Workload examples
10
Cloud Computing in Healthcare: Path to Efficiency and Innovation
Change is possible. The tools exist today
IBM can help you assess and plan cloud adoption. We can help develop business and care delivery strategies, extend IT optimization strategies and build a roadmap. Our roadmap methodology can help you understand not only which cloud strategy meets your needs but also which service is best suited for delivering specific clinical and business use cases. In realizing lower operational costs, increased agility and faster time to market by using cloud computing, healthcare organizations can dedicate more focus on initiatives leading to healthcare innovation.
What IBM offers healthcare organizations • Clear economic value. IBM helps you work through the right mix of delivery models and choices to reap the maximum benefit. An innovative healthcare organization shared lessons gained from an IBM CloudBurst™ (infrastructure as a service) implementation that introduced a pay-as-you-go model to increase project flexibility and allocate freed up resources to other high-value activities. The investment in cloud computing required creativity and a strong commitment to realize benefits. • Integrated and open solutions. IBM actively supports healthcare standards development, working with policy makers, building consensus and delivering unique, innovative new technologies. IBM initiated a community-based effort to drive new standards for cloud computing. Our open standards approach encourages a broader ecosystem, including developers, independent software vendors and resellers, which can lead to collaborative partnerships that will be critical to the deployment and success of healthcare cloud platforms. • Secure solutions that are ready for business. The IBM Security Framework and Blueprint provide a comprehensive method for addressing all aspects of security and an equally comprehensive portfolio of security offerings and services. IBM is working to implement secure delivery models, deploying platforms for industry clouds that are “secure by design” so that when healthcare organizations or communications services providers deliver services, they can trust that their services are not compromised. In addition, IBM Research is helping clients navigate and manage the cloud security landscape. • Designing for simplicity. From sourcing to usage to maintenance, IBM cloud solutions are simple, intuitive and designed for how healthcare organizations actually work. • Globally relevant. We’ve established 11 global cloud computing laboratories to help local organizations, governments and research institutions design, adopt and reap the benefits of cloud technologies. Each lab serves as a gateway for local clients to tap into the knowledge of IBM software, services and research labs around the world.
Healthcare
11
© Copyright IBM Corporation 2011 IBM Corporation Route 100 Somers, NY 10589 U.S.A. Produced in the United States of America February 2011 All Rights Reserved IBM, the IBM logo, ibm.com, Cloudburst, LotusLive, Tivoli and WebSphere are trademarks or registered trademarks of International Business Machines Corporation in the United States, other countries, or both. If these and other IBM trademarked terms are marked on their first occurrence in this information with a trademark symbol (® or ™), these symbols indicate U.S. registered or common law trademarks owned by IBM at the time this information was published. Such trademarks may also be registered or common law trademarks in other countries. A current list of IBM trademarks is available on the Web at “Copyright and trademark information” at ibm.com/legal/copytrade.shtml Lombardi® device, Lombardi Blueprint®, Lombardi Blueprint® device, Lombardi Services® device, Lombardi Software®, Lombardi Teamworks®, Lombardi University® device, and Teamworks® are trademarks or registered trademarks of Lombardi Software, Inc., an IBM Company. Other company, product, or service names may be trademarks or service marks of others.
1 2 3 4 5 6 2010 IBM CEO Study, IBM Global Business Services 2010 IBM CEO Study, IBM Global Business Services Source: US National Institute of Standards and Technology, Information Technology Laboratory IBM Survey: IT Professionals Predict Mobile and Cloud Technologies Will Dominate Enterprise Computing By 2015 2010 IBM CEO Study, IBM Global Business Services Based on results from IBM’s Technology Adoption Program, in which an internal “Collaboration Innovation” cloud was developed using IBM technology. The solution has more than 100,000 participants. Results vary depending on the customer’s existing environment. Final results can only be ascertained after an ROI analysis. IBM’s New Cloud Offering Helps Companies Improve IT Service Desk Operations: http://www-03.ibm.com/press/us/en/pressrelease/33178.wss
7
Please Recycle
GIW03017-USEN-01
