Historically, healthcare organizations have looked at IT and IT budgets as just another cost, or even as a necessary evil. The healthcare industry seems to spend only the bare minimum on IT, while delaying refreshes of infrastructure hardware and desktops until it is absolutely necessary.
Compared to other industries, healthcare organizations allocate about 50% less for IT, keeping IT and associated costs on the backburner. With the incorporation of more and more technology, hospitals, clinics and surgery centers are finding that budgeting for IT is becoming a need rather than a necessary evil.
Healthcare organizations are starting to embrace the philosophy that IT is something that can truly help their organization and can improve patient care and that budgeting for IT is a task that shouldn’t be taken lightly. Here are a few things to help with buy-in of your healthcare IT budget:
Does leadership and the board Of Directors know about the need for IT and the value that it brings?
Leadership buy-in to your IT projects is key to understanding why the IT budget is what it is. In order to have a strong IT budget, leadership needs to understand the value IT is having or will have on the organization. How is IT affecting patient care? Is IT positively impacting day-to-day staff and clinician tasks? Is IT causing unnecessary pain? Leadership should see IT as a tool to help advance and strengthen their healthcare organization. In most industries, IT is also a means to create cost savings, efficiency and quality in other parts of the organization. This is the way healthcare should start to see IT as well.
How is your current IT infrastructure? Is it up to date?
Waiting until the last minute to update and refresh your IT infrastructure can lead to applications, programs, systems and desktops running slow or unreliably. With things running slow, it causes wasted time and unhappy clinicians, staff and patients. Having a solid IT infrastructure, wireless network, core switches, etc. and scheduled refreshes of end point devices will improve the reliability and performance of the network, keeping users happy. You can’t get users to embrace technology and use it effectively if they don’t trust it. Reliability is foundational.
What should be budgeted for?
Exactly what do you need to budget for? Obviously this will vary from facility to facility depending on IT project priority and what you need to accomplish in upcoming years. However, there are a few things you should always plan for in your healthcare IT budget, such as:
- Your infrastructure refresh schedule
- EHR updates or upgrades – planning for the large system upgrade most systems put out annually
- Security needs
- Plans for expansion and growth
Are you looking toward the future?
When budgeting for IT, it is important to have an eye toward the future. By staying vigilant on what updates may be coming, the growing need for security protections, possible regulatory changes, etc., your budget will be better prepared and you won’t have to go through mountain and valley cycles. Be sure to take inventory from other departments on what is required for them in the upcoming year for IT, such as refresh needs or large projects.
We recommend having a rolling three-year IT resources and strategic plan in place to make your healthcare IT budget more effective in meeting your overall IT goals (which are created based on your organizational goals).
Year 1 – Execution year. Everything for this year has already been budgeted for; projects are already happening, etc.
Year 2 – Planning year. This year is to be focused on planning for the next year’s budget, IT projects and operating impacts on areas where more resources may be needed.
Year 3 – Vision year. This year would include more ballpark budgets that would be revisited as the years roll over.
By putting this rolling three-year strategic IT plan into place, it will make creating a budget for the upcoming years easier and allow you to meet your IT organization’s goals.
Budgeting for healthcare IT doesn’t have to be a necessary evil. It can be an effective tool to help your healthcare organization thrive and improve.
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