One common reason for hiring a managed service provider (MSP) is the skill gap within an organization's current staff. A study examining talent outsourcing in a bank in Ghana published in Heliyon, found that when the existing employees lack the capacity or specialized skills to undertake certain technical or technological tasks, the bank resorted to outsourcing these tasks to managed service providers possessing the required high-level expertise.
The study notes, “MSPs outperformed regular staff in the areas of technology-enabled productivity, profitability, quality services, and organizational efficiency using unmatched skills, experience, and expertise.”
This approach helped the organization overcome challenges related to workforce limitations in implementing technological advancements necessary for competitive service delivery. The MSPs’ contribution was especially vital where existing staff could not meet the skill requirements for innovative workplace behaviors or software application development and operation.
Managed service persons brought in top-notch technological know-how, both as a stop-gap measure and as part of a long-term talent management strategy to sustain innovation and digital transformation.
A journal article titled ‘Software-Defined Business’ notes, “The collaboration between the business and the IT side has remained difficult and led to statements like ‘IT is an island’ (Peppard 2007) or the ‘business-IT divide’ (Rahimi et al. 2016).”
MSPs target proactive management aimed at preventing problems before they occur. They implement continuous system monitoring, regular patching, security enforcement, and performance optimization. Their service model includes predictable costs by charging a fixed monthly or annual fee, offering organizations financial clarity and preventing surprises from unforeseen incidents.
The approach frees internal teams to concentrate on strategic core functions rather than firefighting IT breakdowns. Conversely, traditional IT service providers typically respond reactively after a problem is detected, without routine system surveillance, leading to longer downtimes and potentially higher overall costs due to unplanned incidents. This difference indicates a philosophical and operational shift from reactive fixes toward preventative stewardship under MSPs.
Furthermore, while traditional IT services often necessitate on-site presence and interaction with the client’s premises, MSPs generally operate remotely, leveraging cloud technologies and centralized management tools. This cloud-enabled infrastructure facilitates scalability, flexibility, and rapid deployment of IT resources without needing to house additional personnel physically. Managed services may include software and hardware maintenance and strategic IT planning.
One core difficulty MSPs address is healthcare delivery's inherent complexity and fragmentation. Healthcare systems traditionally consist of isolated components, hospitals, outpatient clinics, specialist services, home care, that can lack effective communication, coordination, and collaboration. This results in poor continuity of care, unsafe transitions between care levels, duplication of services, medical errors, patient dissatisfaction, and suboptimal clinical outcomes.
An Interactive Journal of Medical Research study on the impact of online labor platforms on workforce management notes, “Platforms as managed service providers streamline the process of booking by allowing hospitals to access multiple temporary agencies through a single platform. This centralized approach simplifies staffing management and enhances efficiency for health care organizations.”
The absence of well-integrated systems or poorly designed care processes forms a major barrier to achieving high-quality, patient-centered care. Poor design of systems and processes and failure to coordinate interdisciplinary teams deteriorate care outcomes and patient safety.
MSPs aim to resolve these issues by orchestrating care management across settings, aligning incentives, standardizing practices, and implementing technologies that enable communication and data analytics. Managed care organizations (a form of MSP) use techniques like utilization management, risk adjustment, and patient management programs to optimize service delivery, prevent unnecessary interventions, and improve efficiency.
A healthcare system lacking adequate internal cybersecurity staff could leverage a Managed Security Service Provider (MSSP). An example where it could have been beneficial is when in February 2024, Change Healthcare, a major U.S. payment processor, was severely affected by a cyberattack. Providers nationwide could not process claims and revenue dried up, risking insolvency for smaller practices.
A mid‑sized hospital or network dealing with clinician burnout, unfilled technical positions, or evolving cloud needs can engage an MSP to manage infrastructure. For example, University of Tennessee Medical Center (UTMC) lacked sufficient internal staffing to monitor and respond to network alerts. They were outsourced to an MSP for 24/7 monitoring and abnormal activity detection. The MSP’s broader threat visibility across clients was beneficial.
See also: HIPAA Compliant Email: The Definitive Guide (2025 Update)
Covered entities such as healthcare providers, health plans, and healthcare clearinghouses, along with their business associates who handle ePHI on their behalf, must comply with HIPAA rules to protect patient data.
EHRs must ensure confidentiality, integrity, and availability of ePHI by incorporating HIPAA technical, physical, and administrative safeguards.
Patients have expanded rights to access and share their health information electronically, supported by interoperability standards like FHIR, enabling better patient-centered care and health data portability.
Vendors handling ePHI must adhere to strict security mandates, including audits and compliance checks, as they are liable under HIPAA as business associates.