of 3 - Center for Global Outsourcings

INTRODUCTION:
Healthcare Information Technology (HIT) is widely regarded worldwide as one of the means for
improving the quality of healthcare and potentially reducing the cost of care. In particular, the
delivery and cost of healthcare have been challenging issues in the United States. Recent U.S.
administrations have emphasized the utilization of computers and information technology in
streamlining healthcare and reducing its staggering costs. It is estimated that in the United
States, approximately 20% of healthcare expenditures are related to the storing, processing,
and dissemination of information. While attention to the use of information technology (IT) in
healthcare is accelerating, the United States is still in the early stages of achieving meaningful
use of the technology. Consequently, various stakeholders such as hospitals, medical
practices, physicians and consumers face a myriad of issues and concerns related to IT in
healthcare. In this study, we target one group of stakeholders: hospitals, and describe
preliminary evidence regarding their concerns in healthcare IT and offshoring. We look at HIT
offshoring specifically, as offshoring has often been associated with advantages such as
significant cost savings and higher quality, but also has pitfalls such as loss of control and
threats to security and privacy.
HEALTHCARE INFORMATION TECHNOLOGY:
We conducted a survey of hospital CEOs and CIOs in the U.S. nationwide. A total of 177
responses were received. One of the objectives of the survey was the identification of key HIT
issues. Based on literature review, consultation with practice experts, and a pilot test, we
identified thirty four IT issues of potential concern to hospital executives. This list included two
issues related to outsourcing: IT based outsourcing with the country, and IT based offshoring
outside of the country. Executives were asked to rate these issues. Based on their responses,
the top ten issues as identified by these senior executives are shown in Table 1. What is
interesting to observe is that outsourcing and offshoring are not included in the top-ten list. In
fact, they are ranked at the very bottom. IT-based outsourcing within the country was ranked at
number 33 and IT-based offshoring outside the country was ranked at number 34. These are
very surprising and revealing results, as IT-based outsourcing and offshoring are important in
almost all areas of industry in the U.S. and many European countries. One plausible
explanation is that the U.S. healthcare industry is so far behind in IT implementation that it is still
dealing with basic issues and has not had the maturity or skills developed to consider
outsourcing in a serious way. There is also silver lining in the knowledge that there is so much
more to be explored and both healthcare providers and IT vendors can find fruitful venues for
collaboration and mutual benefit.
Table 1. The Top Ten Healthcare IT Issues
Rank Issue
1 Implementation of electronic medical records
2 Reducing healthcare errors with information technology
3 Change management from paper to electronic medical records
4 Privacy of electronic records
5 Improving quality of care with information technology
6 Quality assurance of electronic records
7 Security of electronic records
8 Health information systems interoperability
9 Decision support systems for hospital units
10 Decision support systems for physicians and clinics
Tenth Annual International Daejeon, South Korea P a g e | 59
Smart Sourcing Conference June 28-29, 2012