Optimizing Azure Spend for Healthcare Providers: Making the Most of Your Budget



Cloud technology graphic with healthcare person

Technology is an indispensable component of patient care, data management, and system operations. Healthcare providers are increasingly turning to cloud solutions, with Microsoft Azure emerging as a popular choice. While Azure offers a consumption-based model that allows healthcare organizations to use resources efficiently and scale as needed, managing costs can be a complex endeavor. This blog explores the significance of Azure for healthcare, the challenges faced in cost management, and best practices for healthcare providers to optimize their Azure spend.

Why Azure for Healthcare?

Microsoft Azure is a versatile cloud platform that has gained prominence in the healthcare sector for several compelling reasons:

  • Scalability: Azure provides healthcare providers with the flexibility to scale their infrastructure up or down based on demand. This scalability is crucial for handling the unpredictable fluctuations in healthcare data and resource requirements.
  • Security and Compliance: Azure offers robust security features and compliance certifications, which are paramount in the healthcare industry, where sensitive patient data must be safeguarded.
  • Data Analytics and AI: Azure’s data analytics and artificial intelligence (AI) capabilities empower healthcare organizations to derive valuable insights from their data, leading to more informed decision-making and improved patient outcomes.

However, despite these advantages, healthcare providers often grapple with the challenge of managing Azure costs effectively.

Common Challenges in Azure Cost Management

A survey conducted by Forrester involving over a thousand organizations revealed that a mere 6% felt they had fully optimized their cloud spend. Healthcare providers encounter specific challenges in Azure cost management:

  • Underused Resources: Healthcare organizations often deploy resources that are oversized for their actual needs. This leads to wasted resources and increased costs.
  • Overprovisioning: Allocating more resources than necessary can result in inflated bills and underutilized capacity.
  • Lack of Knowledge: Healthcare IT teams may lack the expertise required to efficiently manage cloud costs, leading to suboptimal resource allocation and spending.
  • Approaching Azure Spend: Features like data egress fees, premium support, and additional services can add unexpected costs to the Azure bill, which may be hidden fees that healthcare providers might not initially account for.

To maximize the value of their Azure investments, healthcare providers can adopt the following best practices:

  • Understanding Your Needs: Clearly define your objectives when migrating to Azure. Whether it’s for testing, data center relocation, or remote desktop setup, understanding your goals enables better cost prediction and control.
  • Performance Over Cost: Prioritize performance to ensure that critical healthcare processes and patient care are not compromised. Cost savings should complement, not hinder, performance optimization efforts.
  • Stay Updated: Azure is continually evolving, with Microsoft introducing new hardware and resources. Regularly review your setup to take advantage of the most efficient and cost-effective options.
  • Expertise Matters: Engage with experts or firms specializing in Azure cloud management. They can provide valuable insights, tools, and automation to streamline operations and reduce wastage.
  • Utilize Payment Options: Azure offers various payment methods, such as pay-as-you-go and reserved instances. Select a payment plan that aligns with your usage patterns and budgetary constraints.

A Case Study

To illustrate the impact of effective cost management, consider a community hospital with 160 beds that engaged a local managed service provider (MSP) for Azure migration. Over 24 months, they overspent by $12,000 each month (over $240,000 in total over-payments) due to the MSP’s lack of understanding of healthcare-specific applications and their utilization in a cloud computing environment. However, after a thorough review of their implementation, Netgain identified immediate savings, along with longer-term cost optimization strategies to bolster security. This case study underscores the importance of expertise in managing Azure costs effectively.

DIY vs Getting Help

While some healthcare providers choose to manage their Azure environments internally, many find value in seeking external expertise. In-house management may lead to a focus on day-to-day operations and reactive responses to performance issues. Conversely, partnering with Azure experts can result in immediate savings, ongoing cost optimization, and a more strategic approach to cloud management.

For healthcare providers, transitioning to the cloud, particularly Azure, can offer a multitude of benefits, including enhanced patient care and efficient data management. However, realizing these benefits hinges on a proactive and informed approach to cost management. Whether you choose to manage your Azure environment internally or seek external expertise, understanding your organization’s needs, staying abreast of Azure offerings, and prioritizing performance will position your healthcare organization for success in the cloud era. By adopting these best practices, healthcare providers can optimize their Azure spend and make the most of their budgetary resources.