KLAS: Hosting healthcare apps creates benefits, requires compromise

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Healthcare providers are finding greater success and satisfaction for application hosting working with software vendors but are able to host a wider selection of applications by partnering with services firms, according to a report from KLAS, a healthcare market research firm.

Services firms offer the breadth to host a variety of applications but often deliver lower customer satisfaction than software vendors, while the software vendors deliver better performance but typically host only their own solutions, according to the Orem, Utah-based company.

KLAS interviewed 176 healthcare providers about 11 software vendors and services firms who offer hosting services. The top-rated vendor was Cerner, according to the KLAS report. Cerner was followed by NaviSite and McKesson, respectively. Other vendors highlighted were Affiliated Computer Services (ACS), Computer Sciences, Eclipsys, GE Healthcare, Perot Systems, PHNS, Siemens Healthcare and Velocity Healthcare.

“When it comes to satisfying hosting clients, software vendors are doing a better job,” said author Mike Smith, KLAS general manager of financial and services research. “Regardless of performance, software vendors can’t meet all providers’ needs because they don’t host other vendors’ applications."

However, 90 percent or more of respondents using Cerner, McKesson and Siemens' hosting services would recommend their vendor to other providers, while less than 50 percent of ACS and Velocity respondents would do the same, the report stated.

“Until services firms can consistently meet client expectations, or until vendors can demonstrate their ability to host other vendors’ applications, providers will be left with limited options for hosting all of their core applications,” Smith said.

KLAS also found that clinical information systems (CIS) customers are not necessarily happier with a hosted solution, despite being relieved of the work associated with product upgrades and hardware maintenance. Only Cerner clients felt increased satisfaction with the software itself once it was hosted, while the majority of CIS clients were less satisfied, the report stated.