Issue link: https://beckershealthcare.uberflip.com/i/1480010
13 Executive Briefing 2 EXECUTIVE BRIEFING SPONSORED BY What's Next for IT Infrastructure Investment in 2023? Q&A with Two Industry Innovators T he last several years have seen hospitals and health systems rush to take on technology transformation initiatives to keep up with changing innovation, customer expectations, and pandemic-era realities. The rapid pace of change has been necessary in many cases, but it has left many organizations with technology-related practices, tools, and staffing that may not serve them as well as they could. Now that healthcare institutions feel the increasing pressure of spiraling costs and resources stretched thin, some might look ahead with a sense that IT investments must be next on the chopping block. But now is the time to double down on IT investment—with an eye toward maximizing tech's efficiency, effectiveness, and contribution to overall cost reduction. We spoke to Shannan Epps, Founder and CEO of Brightwork, and Tabitha Lieberman, President of EHR and Healthcare Applications at Brightwork, to get their take on how organizations can best approach IT infrastructure investment in 2023. What is top of mind related to IT infrastructure investment as we look ahead to 2023? Shannan: What's going to be top of mind for next year and closing out this year is: How do we reduce costs right now? The major problem in healthcare is massive losses in revenue. For example, Kaiser just announced a quarterly loss of over $1 billion. Providence is laying off and announcing huge losses. That's the story of the hour: These massive revenue losses remain an ongoing result of COVID. Fewer patients are going into the health systems, more are going into the emergency rooms, and Medicare reimbursements are nowhere near the rising cost of delivering care. It's a dire financial picture right now in healthcare. So, if they're going to be investing in any kind of IT, it's going to be about reducing costs or creating systems that support new revenue. Tabitha: In light of the extreme financial pressures and the reduction in available capital, I think you'll see organizations looking at their support models. What makes sense to insource? What makes sense to outsource? What is the most cost-effective way to manage your operations? The good of that is that more people will move to modern technology. Let's say that you believe that a partial outsourcing solution is best for you. Doing that when you're in the cloud is much easier than if you're still data center-heavy with on- premise solutions. So, I think you're going to see a move to more modernization. Is outsourcing a good solution for organizations struggling with IT transformation? Shannan: There's value in certain outsourcing, but it has to be done well. There's this rush to outsource everything as a quick Band-Aid solution when faced with a lack of capacity or cost overruns. It's tempting to think you can just let somebody else take it and figure out how to make it cheaper. "It'll go offshore, and everything will be solved." But that doesn't work when it's not done correctly. This move has to be strategic and specific. If it's not, it can end up costing more. There are plenty of examples of large health systems that went through the process of fully outsourcing their IT organizations to offshore companies, only to bring it back in-house after realizing the cost savings weren't there and the dissatisfaction among providers was. Tabitha: Organizations that jump to outsourcing without really understanding what they're trying to achieve are adding potential risks, both to rapid delivery and potential long-term costs. I'm starting to see this in multiple organizations. Shannan: The point is that there are all sorts of solutions to reduce costs and help your organization improve its revenue stance using technologies, but the organization has to be smart about it. Do you think many companies are ready to invest in their IT organization? Tabitha: Today, technology is a core part of everything healthcare delivers. Whether it's your EHR, your patient engagement strategy, your analytics, your research, or your support of oncology and cardiology systems—it is part of the fabric of the healthcare delivery system. So, you need to treat it with the same level of strategic importance as your nursing strategy or physician engagement. It is one of those core elements of success. Many organizations will, in times of struggle, just barely keep the lights on. They will not make heavy investments because they have limited capital to work with. The challenge here is that because health technology has become such a key part of success for healthcare organizations, withholding IT investment now could further delay the implementation of critical healthcare strategies.