OREM, UT – The healthcare IT consulting market, once dominated by large, full-service firms, today includes many smaller but high-performing boutique practices that offer specialized services, according to a new report from healthcare research firm KLAS.
 
Over the past five years, the healthcare IT consulting market has experienced significant consolidation – but that consolidation has led to more choices, rather than fewer ones, for healthcare providers, KLAS researchers conclude.

Following several acquisitions, such as Healthlink Consulting's sale to IBM, many talented senior executives have left acquired firms to join or form new practices, giving providers a larger talent pool from which to choose, according to KLAS.
 
In turn, these smaller firms are consistently outperforming industry heavyweights in a number of practice areas.

The KLAS study, "Maximizing Your Consulting Investment: A Report on Healthcare IT Consulting Services," notes:

• The highest-ranked company in the categories of clinical implementation supportive, planning and assessment, technical services and staff augmentation are all smaller firms, most of which specialize in a specific product or type of work.
• In the planning and assessment category, the top seven performing firms are smaller consulting firms, most of which focused exclusively on advisory services.
• Four firms formed since 2002 scored an 88 or above on KLAS' overall performance rating, which is exceptional.

"The market for HIT consulting has changed dramatically in the past several years," said Mike Smith, general manager for financial and services research at KLAS and author of the IT consulting report. "Providers have indicated that bigger is not always better, and paying more is not the insurance it once was."
 
"Large, full-service firms have deep benches, can weather the attrition of long projects well, and can offer consultants from the most senior level on down," Smith said. "On the flip side, however, some of these firms are more bureaucratic in nature, not as competitive in cost, and not necessarily the best in one area, though capable in multiple areas."
 
Providers cited cost  as an increasingly important factor in the selection of IT consultants. Many CIOs suggest that cost is more seriously evaluated now than ever before, and the current economy has led to fewer projects and more of those projects going internal.

However, that trend may be about to change, especially for the community hospital and ambulatory markets, according to KLAS. Very few hospitals mith mopre than 200 beds have yet to implement a core clinical information system, whereas growth continues in the community and ambulatory spaces. How the recently signed economic stimulus package will affect these trends is yet to be seen.
 
The KLAS report  goes beyond traditional practice areas to evaluate consulting firm competencies with specific technologies. For instance, while most large firms and many small ones offer clinical implementation services, certain firms implement specific products better.

Providers have indicated that Deloitte Consulting does best with Epic; CSC, CTGHS and Perot Systems do best with Cerner; Coastal Healthcare does best with GE; and ACS, IBM and Perot Systems do best with Meditech. These areas of expertise can play an important role in the selection of the right IT consultant.