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Application Hosting in Healthcare Becoming More Dynamic, Competitive

Healthcare application hosting providers are hosting more vendors and providing more services amidst acquisitions and dramatic changes in the market


Orem, Utah – December 21, 2011- Application hosting continues to garner attention from a growing number of healthcare providers, particularly in the community hospital space, according to the KLAS report Application Hosting: Dynamic Changes Bring Providers Better Options. Healthcare providers see hosting as a way to offload capital expenditures and tap into the higher level of technology a hosting provider can offer.One CIO of a 25-bed hospital in the Midwest said, “I don’t worry about anything. [Our hosting provider] takes care of it all; I couldn’t possibly try to maintain all the servers myself.”

KLAS’ report shows that significant shifts in the performance of hosting providers, in acquisitions, and in application hosting sales, which are surging in community hospitals, have all shaped a dynamic market. The competition has increased, and hosting providers have expanded their available hosting options. In 2009, KLAS reported that nearly all software-hosting vendors were performing better than third-party hosting firms. Since then, servicefirms ACS and Dell have had significantly improved satisfaction scores. They now better rival the traditionally highly performing software vendors Cerner, GE, McKesson, and Siemens. ACS and Dell were the only firms hosting Epic and MEDITECH, two EMR market share leaders that don’t offer their own hosting services. Siemens’ scores improved while McKesson’s and Allscripts’ scores fell.

Who Hosts Which Vendor(s)

Now, more hosting providers than ever are taking on multiple vendors. Cerner and Siemens are hosting key third-party applications in addition to their own suites, with Cerner hosting Oracle—which was the major gap for Cerner sites two years ago—and Siemens hosting NextGen. ACS’ and Dell’s improved performance scores position them to offer more competitive reliability and support to healthcare providers wanting one vendor to host all of their applications. All four hosting providers can host the entire suite of hospital and ambulatory applications.

The market landscape has also changed. Xerox has acquired ACS, Velocity has acquired NaviSite’s Lawson-hosting service, and ACS now runs Allscripts’ hosting operation. Most new EMR sales are to community hospitals, and a growing number of these customers are opting for application hosting. Cerner and Dell are seeing particular success, as Cerner offers a packaged, hosted solution called CommunityWorks and Dell’s fastest-growing business is with smaller MEDITECH hospitals on C/S v.6. More clients of McKesson’s fastest-growing and new go-forward platform, Paragon, are opting to have the product hosted.

The Application Hosting: Dynamic Changes Bring Providers Better Options report is available to healthcare providers online for a significant discount. It focuses on software vendors and service firms providing application hosting services for the following application types: EMR, patient accounting, ERP, ambulatory EMR and practice management, clinical ancillary, and business intelligence. It discusses the performance of each hosting provider as well as the applications and vendors they host and what kinds of work the services involve. The report also delves into current market trends in the community space. It discusses healthcare providers’ go-forward application plans and which solutions are closest to being cloud EMRs. To purchase the report, healthcare providers and vendors can visit www.KLASresearch.com/reports.

About KLAS
KLAS is a research firm specializing in monitoring and reporting the performance of healthcare vendors. KLAS’ mission is to improve HIT delivery by independently measuring vendor performance for the benefit of our healthcare provider partners and consultants, investors, and vendors. Working together with executives from over 4,500 hospitals and over 2,500 clinics, KLAS delivers timely reports showing trends and statistics. These reports provide a solid overview of vendor performance in the industry. KLAS measures the performance of software, professional services, medical equipment, and infrastructure vendors. For more information, go to www.KLASresearch.com, email marketing@KLASresearch.com, or call 1-800-920-4109 to speak with a KLAS representative. Follow KLAS on Twitter at www.twitter.com/KLASresearch.