Forget Obamacare. There's something big happening in the healthcare industry, and it seems there is a silver lining to this cloud. Studies say that security, regulatory and privacy concerns might get in the way of cloud computing in the healthcare industry, although this sector is set to grow in the medium term. Cloud computing in healthcare is projected to grow to US$ 5.4 billion by 2017.

Modernization in the healthcare system is going beyond Electronic Healthcare Records (EHR). According to research firm MarketsandMarkets, the use of cloud computing in healthcare will span both clinical and non-clinical applications. Apart from EHR, cloud computing will also apply to other clinical uses, such as physician order entry and software imaging and pharmacy use. Non-clinical uses will likewise benefit, including management apps for patient billing, claims and revenue cycle management.

Advantages of the Cloud

According to MarketsandMarkets, the use of cloud computing in healthcare will be greatly beneficial in sharing EHR data across  facilities in different geographic locations. Using cloud applications will ensure that patients get treated on time, regardless of location and facility.

According to a 2011 study by KLAS Research, 55 percent of hospital executives interviewed said they stored data on the cloud. This included applications like clinical software and email. 71 percent of healthcare providers already deploy, or are planning to deploy, cloud-technology services. However, there is doubt among healthcare providers what cloud computing actually entails, and how it can be effectively used in the industry.

What's Holding Back the Cloud?

But, even with the prospective benefits of cloud computing in healthcare, there are some things holding back facilities and providers from migrating their applications to the cloud. For instance, the Health Insurance Portability and Accountability Act (HIPAA) was found to have impeded the adoption of public cloud systems. The concern lies in the fact that third parties host the data.

"The flip side of this advantage is that health care data has specific requirements such as security, confidentiality, availability to authorized users, traceability of access, reversibility of data and long-term preservation," said the MarketsandMarkets report, published earlier this July.

Another source of delay has been the need to make IT systems inter-operable. In general, the concern is mostly in security and privacy, given the potentially damaging effects of healthcare data falling into the wrong hands.

At present, cloud service providers mostly hold minority market shares, with no single provider holding a share greater than 5 percent. Providers in this industry include Agfa Healthcare, CareCloud, Dell, GE Healthcare and Merge Healthcare. With the industry growing to US$ 5.4 billion in five years' time, service providers will need to assure industry players of security and privacy in storing data and running applications on the cloud, in order to get these apps to scale.