Should you consider an EHR in the cloud?

Which electronic health record system should I select?

Among physicians and managers in small-group practices today, there is no more common question.

But lately, another vexing question has emerged: Whether to install EHR software on servers in your office, or subscribe to an Internet-based system maintained in “the cloud.”

What Is “the cloud”?

When EHR vendors began offering their products via the cloud, many physicians were puzzled. Some think that the cloud is simply techie parlance for the Internet.

In fact, it refers to a method of computing whereby the critical applications are housed in remote locations — “hosted remotely” in tech jargon — and accessed by end users via the Internet.

Physicians have long been accustomed to “hosting” critical software applications on servers in the office. That is how they’ve accessed practice management systems — the information technology (IT) backbone of medical practices — for 20 years or more.

Having all the practice’s data hosted remotely — on the cloud — raises questions about data access and security.

Some of those fears may be eased if you consider how much you are already doing in the cloud.

For instance, many people conduct much of their banking via secure websites that allow them to access all of their private financial information, transfer funds, check investment accounts, and pay bills. Millions have used Web-based email systems such as Gmail for all manner of personal and professional correspondence for many years.

These services live in the cloud.

You do not have any software loaded and running on your computer to use these tools.

So, the cloud is really just a giant client-server model: a distributed application structure that partitions tasks between the providers of a service (called servers) and the clients. A client (a user workstation or PC) initiates communication sessions with the server by requesting a service function.

In the cloud, the server providing the service — for example, an EHR service — is hosted remotely. Your Web browser is the client.

Why the cloud is gaining in popularity

Cloud computing represents a paradigm shift in IT management. The cloud makes it possible for you to grow and expand rapidly and generate efficiencies and cost savings by paying as you go for the services you use.

Cloud-based EHR services are typically offered as complete software packages provided over the Internet, eliminating the need to install and run an application on your own computers and simplifying maintenance and support.

Sometimes this is referred to as “software as a service,” or SaaS.

For many practices the cloud-based solution is a good choice for several reasons:

  • Generally, there are no retained earnings in a medical practice, so any new investments must be financed externally or the physicians take a hit against their current earnings. Low up-front costs are more palatable and less complicated.
  • IT expertise and resources may be nonexistent or retained on a project-by-project basis. The cloud model does not require sophisticated technology infrastructure that must be built and maintained by expert, costly IT staff.
  • A cloud-based EHR does not require a special facility or environmental considerations because on-site servers are unnecessary. Backup and disaster recovery services are central and inclusive in the cloud model.

But fear of losing control over critical data is often a stumbling block in cloud adoption. Actually, though, cloud computing can give you more control over your data than you get with a client-server EHR.

Cloud providers offer many options for protecting the data entrusted to them — often more than your in-house IT staff or budget could make possible. In all situations, however, data sovereignty should belong to you.

Other benefits of cloud computing:

  • An encrypted high-speed Internet connection provides your practice with access to data and applications without having to manage software changes or invest in server hardware
  • Updates are automatic and managed by the vendor so you won’t need staff to work over a weekend to install software, migrate files, or test data conversions
  • And you’ll always be on the most current version, without requiring additional infrastructure investment.

Although there are start-up costs with the SaaS cloud model, typically around $13,000, there is no up-front software license to purchase or lease. With a client-server setup, those usually run more than $60,000.

And although you won’t be paying a software maintenance or upgrade fee, you will be paying a monthly subscription or service fee, typically about $500.

For organizations that have the wherewithal and staff to maintain a data center (multiple servers, perform regular data backups, manage software upgrades, and attend to the details of technical troubleshooting) a client-server model is a viable choice, but may still be cost-prohibitive.

Practices that find startup investment in a data center daunting, or do not have adequate IT support, will find clarity in the cloud.

Rosemarie Nelson is a principal with the MGMA Health Care Consulting Group.

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  • http://www.gretchencampbellmd.tumblr.com/ Gretchen H. Campbell, MD

    Having multiple choices is always a plus. That said, there are hundreds of choices in the EHR world, but the main questions to ask are the following: 
    1. Is the EHR connected to billing? This I would not recommend. You want to be able to look your billing company or biller in the eye and hold them responsible for “working claims”, not just submitting them. (You could potentially lose a lot of money if you farm your billing out to a faceless company that you find on the internet.) This can be done with a local billing company in your area, or (if you are large, vigilant and/or sophisticated enough) in house billing can be done. (Though there is risk to in house billing, it can work if you know what you’re doing.)

    2. Cost (both upfront and over time). The cost of EHRs vary as much as the services provided.  I use an EHR that I purchased for 30K and spend about $1500 per year per provider for upgrades, maintenance and access to the tech department if needed. This is far less than $500/month.  I do have IT costs of $85/hr, but this is needed on a prn basis. 

    3. Is the EHR a real full service EHR (meaning is there an updated database of CPT and ICD-9/10 codes, etc. You want your diagnoses and procedures to link to the proper codes. Some EHRs are basically sophisticated data entry and access programs.  

    Ask doctors you respect and get feedback re 5-10 companies (cloud and non-cloud systems) and make an informed choice. Due diligence is KEY.

  • http://onhealthtech.blogspot.com Margalit Gur-Arie

     First of all there is cloud and there is cloud, and for EHRs only a handful of small players are truly cloud-based, i.e. hosted by an Amazon type expand-as-you-need infrastructure. There are two types of remote hosting: 1) web based EHRs where all data for all customers resides in the same database system and purpose built to be accessed by a web-browser, and 2) traditional client/server EHRs where the vendor (or reseller) hosts your server (including database) on separate server instances (usually virtual), and you use the vendor supplied client to access your server via the internet.

    There are advantages and disadvantages to both approaches, and it is important to remember that even if you host your own server, chances are that the vendor can (and will) lock the data if you, say, stop paying, and you will not be given access to the database to extract data without vendor permission. Vendors usually, retain a way to access your server at will, for maintenance, support and other reasons.
    Remotely hosted software, particularly the type that resides in one database, allows vendors to make other uses of your “de-identified” data (check your contract and you will find that you gave them permission).
    Remotely hosted software can be slower to respond, depending on your internet provider and depending on where exactly the software is hosted.

    On the other hand, you will indeed save some money on IT support and hardware if you let the vendor host your EHR, but you will still need IT support for all those computers and wireless networks and peripheral equipment. The servers themselves are not expensive. The work around them is, but only incrementally more than what you now have if you host your own PM system.

    As to pricing of the software, a monthly subscription for hosted software will indeed run about $500, but the average upfront license is only around $10,000 per provider and many are less. The “funny” part is that if you calculate your Total Cost of Ownership (TOC) over 5 years, you will almost always discover that the subscription model becomes more expensive in aggregate somewhere around year 4 or 5, depending on the vendor.

    I do agree with Gretchen on the billing. Be very careful when you outsource your billing and make sure you understand which claims will not be “worked” by the vendor. Some are excluding small claims and in primary care most claims are small claims. Caveat emptor as usual…..

  • wahyman

    I don’t think all of the negatives of the cloud have been yet addressed, including loss of data and total dependence on the vendor and their contnued existance. Also, can you have all your data back or move it? Assurances that the cloud will always be there for you has elements of vendor hype that must be (as with all vendor hype) considered with due care.

    I have addressed some cloud issues here:
    http://medicalconnectivity.com/2011/05/10/storms-from-the-cloud/

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