Why health systems are dropping their IT teams

Why health systems are dropping their IT teams
Modern Healthcare
December 7, 2023
The digital transformation is underway at health systems but it increasingly doesn’t involve in-house IT departments. Health systems are transitioning their analytics and tech employees to managed service companies as they look to scale virtual care, artificial intelligence and analytics initiatives. By moving the work out-of-house and the employees with it, a process called rebadging, health systems struggling with razor-thin margins say they can deploy IT projects more efficiently while saving on costs. ... In November, consulting firm Guidehouse surveyed health system CEOs and chief financial officers about their top three IT investment priorities in 2024. A third of respondents said they have expanded relationships with IT outsourcing partners ... But there are downsides to the strategy. The transition of employees can be bumpy. Also, by offloading IT employees, the quality of work can be worse when the outside company doesn’t understand the system as well. Aaron Miri, chief information and digital officer at Jacksonville, Florida-based Baptist Health, has used contractors for various projects, including the systemwide install of Epic. But he said the concept doesn’t work for certain tech-related projects, such as improving employee engagement. “You’re giving up something to net something,” he said. “You can’t have it cheap and have top quality, happy employees. Something has to give. You have to consider the tradeoffs.”