The business value of IT in healthcare.

Abstract

INTRODUCTION: Today, healthcare is investing heavily in IS/IT. Most recently, Gartner has ranked the healthcare industry as the fifth highest spender on IS/IT with about USD108 billion, and a growth percentage of 2.7% compared to 2013. In Australia we are now witnessing this trend with large invests being made by various healthcare organisations into various technology solutions to provide and enable better care delivery. BACKGROUND: Although significant investments are being made by healthcare organisations in technology, there are many failures which raise questions about the business value of these large expenses. Hence, evaluating the business value of IT in healthcare is crucial. This study attempts to answer the question: "how can IS/IT facilitate the generation of business value in healthcare?". METHOD: This study develops a framework to evaluate the impact of different IS/IT on different outputs such as patient outcomes, safety, efficiency, and financial performance. This framework is then tested in a non-for-profit tertiary healthcare group. both interviews and archival documents are used to answer the research question. RESULTS: Four clinical information systems and one business information system were examined in this study. Results show that the majority of the studied clinical IS 1) help adhere to care protocols, and enhance patient safety by reducing medical errors and clinical incidents, which potentially reduces cost, and 2) have fewer impacts on the efficiency of care delivery operations given the clinical domain is partially digitized and partially paper-based. The results also show that the examined business IS helps increase efficiency and reduce cost by substituting huge human workforce and performing higher volume of transactions in a given time. CONCLUSIONS: This study draws a road map to attaining business value from IS/IT investments in healthcare. The implications on practice and theory are far reaching.