How to Provide More Health Services With Less Budget (The Answer Is in the Cloud)

Healthcare agencies are committed to providing the public with better digital services. By that they mean better integrated services, accessible through more channels and with greater personalisation. But their budgets are typically static or only increase by small percentages each year. And that’s certainly not enough to achieve the desired transformation.

On top of those financial constraints, they face pressure from three other sources. Legacy infrastructure environments are increasingly expensive to maintain and lack flexibility, so are no longer fit-for-purpose. Then there are internal pressures, which come from governance requirements for better solutions for risk management and compliance and from business units wanting single point solutions for new and emerging problems. And finally, citizens (and their elected representatives) demand increased access to services through an ever-proliferating array of digital channels. All this results in an explosion of shadow IT services – decentralised, siloed and non-standardised. This multitude of unmanaged point solutions adds complexity, compromises efforts at integration and increases the cybersecurity threat. Shadow IT doesn’t really solve problems; it simply expands the mess.

And, as if this weren’t sufficiently challenging, the volume of data that each healthcare organisation generates each year is growing exponentially, and whilst a lot of data is being retained and used, a considerable amount of data is being discarded.

In fact, data is at the heart of the problem, because citizens (quite rightly) regard their personal data as highly sensitive and expect those organisations that work with it to keep it secure and protect their privacy. Those charged with leading technology development recognise their responsibility to protect patient privacy and comply with regulatory requirements. They often feel that this requires special bespoke solutions or approaches, which is inherently expensive. But the health sector is not alone in this: intelligence agencies, the military, multinational companies, retail organisations and local government all require high levels of security.

So has the need to protect data and keep consumer information private locked all these organisations into an ongoing cost spiral? That’s arguably the biggest question facing organisations that store large volumes of citizen data. But, as so often, the answer is in the question, because a focus on data also leads us to a potential solution: more cloud.

How cloud has changed IT models

The large cloud platforms such as AWS, Azure, Google Cloud and Alibaba Cloud have become the new normal powering technology services across the globe by bringing the benefits of immense scale, highly resilient and reliable infrastructure, pay for what you use models and deep automation of all operations.

Just five years ago technology vendor’s revenue came primarily from sales of equipment to governments and other large organisations. High value items went into data centres. But now organisations data centres don’t provide the scale and therefore economic advantages delivered by hyperscale cloud providers. They bring the benefits of scale to customers at a per-user cost model that changes everything.

There are three forces driving this.

1. Pricing. For the last 14 years hyperscale cloud pricing has been reduced- the price of computing power, storage and networks has become more affordable. The large cloud platforms are using their scale to reduce cost and pass on those cost savings. This is an important part of cloud economics, the benefit of scale. Traditional technology vendors would often increase prices with every new release, whereas the pattern for cloud providers is frequent price decreases. With overall tech budgets relatively static cloud, is enjoying an ever-increasing share of the market. As a result, cloud spend has grown dramatically over the last decade) while expenditure on data centres has declined.

And it’s not just the cost of storage, the cost of computing declines too. With servers the equation is simple: the more you have the more you can do. This opens up the possibility of compute-intensive applications like AI and machine learning, both of which were prohibitively expensive a few years ago, but which now represent almost 20% of cloud provider offerings.

2. Access to innovation. Cloud has disrupted IT by democratising technology innovation. As soon as AWS launches a new feature or services all customers globally get access to it, regardless of what they spend per month. Prior to cloud, most technology vendors saved the latest features and premium innovations for their largest spending customers. This stream of easy access to new technology innovations and capabilities is just as powerful for public and private healthcare providers. This changes the access to innovation.

3. Geographical dispersion. The last five years has seen the geographical footprint of the cloud providers spread across the planet, putting data centres and infrastructure in more countries and cities while also giving customers control on where their data stays and lives geographically. This allows healthcare organisations to make their technology services more secure and more resilient and compliant with data sovereignty principles in ways that were unaffordable only a few years ago.

Triaging privacy within health IT

That brings us back to the core question: managing sensitive personal health data. Indeed, placing an emphasis on the need for unique protected solutions and a bespoke approach begs the question: “Do all solutions need to be unique?” Instead, it is better to triage the problem and ask: “Which parts of the solution have to be unique? And which can leverage standardised approaches, Reusable components and off-the-shelf- solutions and services?”

I suggest that instead of saying “We can’t use the cloud and the innovative, inexpensive off-the-shelf solutions that are now available because we have to protect consumer privacy”, the default position of Health IT leaders should be: “What can we not now do in the cloud?”

With that approach, allocating budgets becomes more manageable because health providers can take advantage of cloud innovation, cloud economics and cloud geography. But this requires flipping traditional approaches on their head. To leverage the benefit of cloud, organisations need to have as part of their technology strategy clarity around which parts of their technology will be bespoke to their business situation and then ensure they leverage and adopt standardised approaches for everything else.