The Rise of Cloud Computing in Healthcare

The adoption of cloud computing in the healthcare industry has been growing year over year. In 2019, the Healthcare Cloud Computing market size was $20.9 billion, and according to a recent industry report, it’s expected to reach $90.46 billion by 2027 with a compound annual growth rate (CAGR) of 17.9% during that time.

The COVID-19 pandemic has helped speed up the adoption of cloud computing as systems have been pushed to the limit with data storage and processing demands, in addition to the ability to access patient and business data securely from remote locations with many IT employees working from home. Data accessibility and storage weren’t sustainable with the workplace changes brought about by the pandemic. Healthcare organizations had to adapt and quickly find solutions for interacting with patients and accessing and storing data. They turned to the cloud.

A Frost & Sullivan 2020 report stated that more than 70% of healthcare providers responded that they were comfortable using the cloud to store a variety of information including: health records, medical images, genomic information, patient registries, and other identifiable information related to patient billing, scheduling, and registrations.

Benefits of Cloud Computing for Healthcare Organizations


With cloud computing, a patient’s information is stored in a central location and can be accessed in real-time by medical professionals even at the same time. Cloud computing allows the secure transfer, sharing, and access to patient information by doctors no matter where they are or what information is needed. Cloud computing also allows doctors to meet with patients via telehealth methods when an in-office visit isn’t necessary. Telehealth is still in its infancy, but the demand from patients will continue to increase as more companies offer the service.

Security & Reliability

All healthcare organizations must comply with HIPAA, the Health Insurance Portability and Accountability Act that Congress passed in 1996. In 2003, The Security Rule was added to HIPAA standards and sets the standards for the security of electronic protected health information and applies to covered entities, doctors’ offices, hospitals, health insurers, and other healthcare companies, with access to patients’ protected health information (PHI), as well as to business associates, such as cloud service and IT providers, that process PHI on behalf of healthcare organizations.

Cloud service providers such as Microsoft Azure have taken precautions to ensure that PHI is protected and contract with organizations, setting limits on how they manage PHI. When healthcare organizations outsource their data storage to HIPAA-compliant managed services, the executive team can feel confident that the company data will be secure and comply with HIPAA guidelines (link to HIPAA checklist blog). 

Additionally, cloud computing provides increased reliability of data redundancy and system uptime by automating backups and providing disaster recovery options. With an on-premise solution, if network equipment fails, healthcare companies may lose data or applications. However, cloud computing provides disaster recovery options, so if systems are breached, there is no data loss. And organizations can utilize multiple options to stay up and running with almost no interruption or downtime.


Healthcare organizations have found that moving to the cloud positively affects the bottom line by shifting capital expenses such as in-house computer systems to operational costs that include pay-as-you-go subscription models. Moving to the cloud reduces overhead costs associated with hardware and IT staffing. Outsourcing the management of cloud systems frees up in-house IT staff to focus on more strategic projects.

Scalability and Flexibility

Cloud computing allows healthcare organizations to be more fluid in their decisions for software, office locations, staffing, and more. Because the healthcare environment is constantly changing due to new regulations, competition, legal and financial adjustments, companies who utilize the cloud can easily reconfigure their systems and software.

Healthcare companies will continue to transition to cloud computing because of the financial and organizational advantages it provides. Working with your managed IT service provider will give you the expertise and experience you need to meet the HIPAA compliance challenges for your cloud environment.

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