Healthcare MSP: Benefits and Importance

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Cloudticity, L.L.C.

The COVID-19 pandemic laid bare numerous challenges facing the healthcare industry—including serious staffing issues. During the pandemic, hospitals, clinics, and other healthcare providers struggled to deliver quality care to an influx of patients while grappling with intense nurse shortages and out-of-control labor costs.

That staffing crisis drove many facilities to embrace healthcare managed service provider (MSP) and vendor management system (VMS) models.  

In the past, facilities were responsible for managing dozens of contracts for healthcare workers and suppliers. Those workers and suppliers all had their own rates, and many had distinct processes for billing. Healthcare MSPs and VMSs have helped dramatically simplify the management of workers and suppliers. It is now estimated that 71% of healthcare facilities use a VMS or MSP to help them manage their external workforce. Of those facilities, 54% use MSPs.

What Is the Healthcare MSP Model?

The healthcare MSP model streamlines workforce-related services, such as payroll services, workforce management, resource planning, supply change management, regulatory compliance, and other services used by healthcare facilities. The goals are to ensure the availability of clinical staff and to handle contingent labor staffing challenges. Think of an MSP as an external human relations department.

What Is the VMS Model?

A VMS is a software solution designed to optimize procurement and management of contingent labor. A facility might choose a VMS if the plan is to streamline internal processes rather than to outsource tasks. The facility could implement the VMS as part of a larger digital transformation. 

MSP and VMS models are not mutually exclusive. An MSP might use a VMS on behalf of a client to deliver services. Or an MSP might implement a VMS for the facility to use. 

Why Should You Engage a Healthcare MSP?

There are many potential reasons for working with an MSP. Here are five key reasons:

Free up resources

Some facilities simply cannot handle the large amount of work required to manage specialized contingent and temporary workers without pulling staff away from patient services. By partnering with an MSP, a facility can offload as much of that work as necessary. Internal staff can focus on improving patient experiences and delivering exceptional care.

Reduce costs

Recruiting and hiring highly qualified candidates are costly processes. When healthcare facilities work with a healthcare MSP, they can avoid the large upfront costs associated with recruiting and hiring. Facilities can pay MSPs as a bill rate percentage, spreading expenses out over time.

Minimize friction

Whenever more steps or people are added to a process, that process can slow down. The hiring process is no exception. Candidate profiles are passed to managers, who must relay information to account managers, who must communicate with staffing agencies. Healthcare facilities that partner with an MSP can alleviate friction, avoid the frustration of never-ending processes, and speed hiring.

Improve quality

A healthcare MSP can also help improve the quality of candidates. Facilities can rest assured that candidates won’t reach hiring managers unless the candidates have been thoroughly vetted and deemed qualified. MSPs often have pre-existing relationships with candidates, which can help ensure that facilities will see only reliable, high-quality individuals. And of course, hiring skilled personnel can help facilities increase the quality of care and improve healthcare outcomes.

Streamline decision-making

Facilities can offload time-consuming decision-making processes to a healthcare MSP. For example, the MSP can decide which vendors to contract with, how to construct the onboarding process, how the workforce should track their time, and what the hiring process will entail. In making these decisions, the MSP can draw on proven best practices.

How Does a Healthcare MSP Help Drive Workforce Efficiency?

In addition to optimizing the complex tasks associated with contingency staffing and workforce management, a healthcare MSP can take on additional tasks that help your organization enhance efficiency and save money.

  • Business intelligence – Your healthcare MSP can regularly provide insights and metrics that matter the most. By pointing out key performance trends, the MSP helps you better plan for the future. 
  • Automation – A healthcare MSP can offer a one-stop shop that automates time-intensive tasks such as contract management, timesheet completion and approval, assignment extension, and more. This resource automation can lead to substantial savings that ultimately help you control healthcare costs.
  • Simplified recruiting and outsourcing – Your healthcare MSP can help ensure you have ready access to the staff you need. The MSP can draw from a global pool of clinical workers, providing you an easy-to-manage source for all your workforce needs, including temporary staff and travel nurses.
  • Regulatory compliance – A healthcare MSP that offers IT services can help make sure your technology, security measures, and processes are current and adhere to regulatory requirements, such as HIPAA. You can better prepare for any audits, saving you from potential penalties, fines, and downtime.
  • Employee engagement and retention – You can improve workforce efficiency across the board with the healthcare MSP’s ability to supply a reliable, easily managed pool of qualified temporary workers. By hiring workers that are more likely to stay in their positions, you can reduce the time and effort of continuous recruiting. 

Keep in mind, also, that a reliable, quality healthcare MSP partner will customize its approach to best align with your facility’s initiatives and strategic needs.


What is a healthcare MSP?

A healthcare MSP can help a hospital, clinic, or other healthcare facility reduce costs, improve processes, and enhance quality by implementing, automating, and managing tasks that the facility previously had to manage itself. The facility can better focus on providing high-quality patient care and improving patient outcomes.

What are the types of healthcare MSPs?

There are several types of healthcare MSPs. For example, while some MSPs address staffing challenges others might help with specific business processes, such as revenue cycle management (RCM). The sole purpose of all MSPs—including MSPs outside of the healthcare sector—is to reduce business management complexities and free up internal resources by outsourcing management operations to experts that already have infrastructure and processes built out.

In the healthcare industry, two of the most common types of MSPs are healthcare workforce MSPs and healthcare IT MSPs.

  • Healthcare workforce MSP: A healthcare workforce MSP handles the full recruitment and development lifecycle. The MSP increases efficiency and reduces costs by optimizing both clinical and nonclinical contingent and core talent.
  • Healthcare IT MSP: A healthcare IT MSP manages your IT infrastructure, freeing your team from infrastructure management and IT staffing. The MSP’s healthcare IT consultants can also assist with a range of initiatives, including replacing legacy systems with modern, innovative IT solutions, and implementing cutting-edge technology such as AI or machine learning tools. On an ongoing basis, the MSP can manage key systems, including your electronic health record (EHR) system, digital health platform, or other healthcare IT solutions.

Cloudticity can serve as your healthcare IT MSP. Our managed cloud solution handles your operations, security, and compliance. The Cloudticity Oxygen™ platform also maps controls to HIPAA and HITRUST frameworks, enabling you to easily monitor and maintain compliance of the environment.

Why are MSPs so important?

A healthcare MSP can be a vital addition to your organization because it offloads and automates time-consuming, labor-intensive, mundane tasks, freeing up your human resources and administrative staff. At the same time, the healthcare MSP can help streamline the work of ensuring regulatory compliance. 

What is a cloud MSP?

Managed cloud providers, or cloud MSPs, take on the heavy lifting of managing cloud environments, such as Amazon Web Services (AWS) and Microsoft Azure, for healthcare companies. A healthcare cloud MSP like Cloudticity can help your healthcare organization maintain operational efficiency and security profiles in your cloud environment. Like a healthcare MSP used for staffing, a healthcare cloud MSP can help you fill gaps in IT staff to reduce the work needed and complexities of maintaining IT environments.

Looking Ahead with MSPs

The expansion of the Affordable Care Act (ACA), an aging population, and a shortage of clinicians and nurses will all contribute to rising demand for healthcare workforce MSPs in the next decade. It is the go-to solution for contingent labor staff challenges. In fact, according to Market Data Forecast, the global healthcare workforce management systems market is forecasted to be worth $2.64 billion by the year 2027, growing at a CAGR of 13.6% from 2022 to 2027.

If your facility is struggling with staffing shortages, IT challenges, or business process issues, a healthcare MSP might be the solution. You can outsource time-consuming tasks to experts and focus on delivering high-quality care. 

Want to learn more about how a healthcare cloud MSP can improve your business? Schedule a free consultation with a healthcare cloud expert today.

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