Healthcare Market Offers Opportunity, Challenges For MSPs
Healthcare digitization offers an enormous opportunity for MSPs but smaller firms face training and regulatory challenges that prevent them from fully participating in the market.
![Synoptek employees work in a remote monitoring facility Synoptek employees work in a remote monitoring facility](https://eu-images.contentstack.com/v3/assets/blt10e444bce2d36aa8/blt5f3c913246dac240/65264659192495c954e3feaf/synoptek-eoc-2_0.jpg?width=1280&auto=webp&quality=95&format=jpg&disable=upscale)
Digitization of the healthcare industry has been very good to Synoptek, an Irvine, California-based managed services provider.
The firm has grown 300 percent since its founding in 2005 and nearly a quarter of its business comes from medical providers seeking to outsource their information technology needs and comply with record-keeping and security requirements mandated by the Health Insurance Portability and Accountability Act (HIPAA), and the Affordable Care Act.
That trend shows no sign of slowing.
Synoptek’s healthcare-related revenue continues to increase, with average year-over-year growth regularly hovering somewhere between 18 and 22 percent, said Mike Bank, the firm’s vice president for sales and marketing.
“It is the second-highest growing vertical that we see as a company – right behind general technology services,” he said.
Healthcare IT has become a boon to the entire U.S. economy, offering an estimated $80 billion in net savings through greater efficiency and a 20 percent increase in related jobs, like medical records and health information technology technicians, according to a 2014 report from the Computing Technology Information Association (CompTIA).
Nowhere has the trend been more acutely felt than among managed services providers, which have been enlisted by healthcare firms to oversee the conversion from paper to electronic health records and the automation of numerous processes aimed at reducing cost and improving patient outcomes.
But while the transition offers an enormous opportunity, smaller MSPs continue to face training and regulatory hurdles that prevent them from participating in the market in meaningful numbers.
Among the barriers to entry for smaller firms:
A dizzying patchwork of state and federal laws contain varying definitions about what constitutes a reportable data breach and how quickly such breaches must be reported. The legal expense of staying on top of the disparate requirements in each state can be prohibitive for smaller firms.
New rules enacted as part of the 2008 economic stimulus package extend HIPAA liability for violations of personal health information security to business associates and contractors, exposing MSPs to criminal penalties, costly lawsuits or civil fines as high as $1.5 million.
Insufficient training exists to help current IT professionals get certified in the intricacies of the healthcare sector.