Hey Health Care Entrepreneur, Why are You Doing This the Hard Way?

Hey Health Care Entrepreneur, Why are You Doing This the Hard Way?

Last year we met with a brilliant gentleman armed with the next “disruptor” in the Health field.  It was a novel way of looking at something that was broken and making it not just workable, but necessary to the market.  There comes an inflection point where the genius and work ethic of the entrepreneur is not always enough to translate to a successful business.   As earnest as he was, Bill squandered the opportunity to build a real business.  This is a simple cautionary tale to all entrepreneurs.

Bill wanted to build his business the old-fashioned way.  Because he was technically adept and had the assistance of several buddies that could moonlight their IT acumen, he thought it wise that they build their own internal IT infrastructure.  Do you know anyone like that?  After a few months of searching, he contracted for datacenter space.  He bought hardware.  He bought software.  He waited weeks for delivery.  His team spent weekends at the datacenter installing and optimizing.  Bill spent more than $50,000 and more than five months of his time invested in the infrastructure.

So, what is wrong with that, you ask?

The issue was the core competency of the business had nothing to do with being able to deploy, manage and sustain an IT infrastructure.  It was not a differentiator in any way.  It made no more sense than if my dentist had tried to do the same.  He’s owns a dentist practice, and although his practice uses computers, he’s not in the IT infrastructure business.  Bill wasted months of his time and money and more importantly, he wasted the opportunity to grow the core business at its most critical juncture.  Although we met Bill too late to help, here are four sage reasons that your company should leverage a managed service provider (MSP) focused specifically on healthcare.

Your Focus:

What is your time worth?  Can you afford to be distracted with anything that is not core to the business?  I can guess your day is filled with talking to investors, hiring great people, managing teams, networking and looking for revenue under every rock.  Look at IT in the same light as you would look at the plumbing in your office.  It should be a given that the IT infrastructure is in good working order just as you expect to get water when you turn on the faucet.

Experts on Demand:

This is big.  Many companies don’t understand just how big until faced with making a hiring decision that does not directly attribute to revenue.  Cash is king and it is scarce.  If your organization can leverage and only pay for experts when needed, there is no reason to hire that expertise internally.  Try hiring a CISO these days.  Not only is it nearly impossible, but there is a strong likelihood that hire will jump to another opportunity within a year.  What will be the cost of finding another CISO and what does that do to the consistency of your business?  There are hundreds of subject matter experts within managed service providers readily available.  These experts range from simple administrative tasks to advising on the most complicated of HIPAA compliance interpretations.  Because these experts service hundreds of companies with wide ranging needs, they have a global view of best practices and can recommend solutions immediately.  These are proven and salient solutions for your company, many of which can be automated and institutionalized.

HIPAA Compliance:

HIPAA is not prescriptive.  You won’t find a checklist out there that walks someone without intimate knowledge of HIPAA through the process.  Managed service providers with emphasis on HIPAA compliance spend millions of dollars hiring experts, developing process and governance, deploying resources, technical, security and other assets to assure compliance.  Many now have user friendly dashboards that immediately identify compliance status.  If an issue is not in compliance, not only will it identify the issue, it will offer a specific remedy.  Many of these functions are highly automated which translates into a guaranteed compliance measure.  The cost to replicate even a rudimentary environment is exponentially higher than the cost of a purpose built managed service provider.  A further point is that a wise company can actual defer much of the risk to the MSP.  Deference of risk is brilliant on many levels not least of which means they are firmly invested in assuring your compliance.  One important note, just because an MSP says they will sign your BAA, it does not mean your liability is fully covered.  Engage consultative and legal expertise to study and assure agreements.


By now it is starting to seem obvious.  We’re talking simple ECON101 tenets.  Cloud Economics is built on three pillars of agility.  These are Financial agility, Labor agility and Technological agility.  The three pillars play in concert to give today’s forward looking company the ability to scale up and down, pay only for resources used, decrease investment in non-revenue producing labor and the ability to pivot, fail-fast and any other euphemism that implies that ability to be agile in the truest sense.  At this stage, your company should be hiring developers, R&D and sales people.  Invest where you have a competitive advantage and a path to revenue.  If you are investing in assets that do not provide direct revenue, those commitments should be examined with a highly skeptical financial eye.  Keep in mind these providers are investing for scale and that is not something you can hope to replicate.

The core competency of your business is providing healthcare in its purest sense.  Is your competency also information technology, security, risk-mitigation and the costs to deliver a highly compliant practice?  Does it make sense to endure the expense of maintaining an IT staff in-house particularly if the result is less than what is available in the market at a fraction of the cost?  Would it not make more sense to obtain world-class experts on demand that handle the most complicated of security issues on a daily basis with healthcare organizations of all shapes and sizes?  One that will accept the risks of the often undefined and fuzzy world of HIPAA?

The ability to guarantee uptime, provide instantly available audit information, coupled with an acceptance of risk is readily available from numerous providers in the market.  The agility to make changes, consume and pay for only what is demanded should be a given for your business.  The ability to leverage Cloud Economics with compliance as the cornerstone will give your business a sustainable competitive advantage.

Bryce Lopez is a Partner with Avail Partners.  Avail Partners is an independent technology consulting agency transforming the way business leaders take advantage of cloud economics.  Avail has a long-standing healthcare focused practice.  Avail evaluates vendors daily on performance, price and contract terms for Infrastructure-as-a-Service, datacenter hosting, cloud platforms and networking services.  The agency provides market intelligence, solutions design and IT/revenue analysis, while protecting against disruptive vendor sales tactics by providing client anonymity.  Avail’s methodology results in time savings, confidence in due diligence, cost containment and increased revenue potential for clients.

Bryce can be contacted at Bryce.Lopez@availpartners.net or visit www.availpartners.net