Legacy System Modernization in Healthcare and Pharma: Challenges and Solutions

According to a global HIMSS survey published in 2022, 73% of healthcare provider organizations had legacy information systems. Despite the rapid advancements in technology and post-pandemic boost in healthcare systems digitalization, legacy healthcare platforms still exist and are costly and challenging to maintain.

But why do so many healthcare organizations still rely on obsolete software that often creates additional work for their staff? The answer is simple: they got used to it and are afraid of the process disruptions, downtime, high costs, and data loss risks that may occur during modernization.

In this article, we’ll dispel the myths about legacy application modernization in healthcare and pharma and share insights and strategies for approaching it correctly.

But let’s start with the basics.

How do you indicate that your healthcare software is already outdated?

As software ages, it tends to experience slow response times or gradual performance degradation. Identifying early warning signs that indicate a system is nearing its end of life is crucial to avoid costly outcomes, including productivity setbacks, compromised security, and operational disruptions.

Here, we’ve gathered several early indicators of healthcare software obsolescence.

Modern healthcare operations heavily rely on seamless data exchange between systems – from billing and scheduling to electronic health records (EHRs) and telemedicine platforms.  If your software can’t easily connect and share data with these systems, it’s a sign that it may be outdated. Poor interoperability may lead to duplicated data and silos, increased need for manual data entry, and delays in accessing complete patient records — all of which result in reducing the overall quality of care. As for the pharmacy applications, when they are installed locally, managing IT infrastructure across multiple stores can become a tedious and expensive task.

If the pharmaceutical or healthcare system is sluggish, it may be due to outdated technology or poor optimization. Slow response time can lead to longer wait times for both healthcare providers and patients and reduced productivity. This happens because healthcare staff spend more time waiting for systems to respond and have less time available for patient care.

The Fast Healthcare Interoperability Resources (FHIR) standard emerged as an alternative to existing HL7 standards and quickly became the leading API for health data exchange. The federal rule stated that certified EHRs must support the FHIR API standard by the end of 2022. 

Yet, a survey published in the JAMIA journal found that only 73% of digital health vendors use standards-based FHIR APIs when integrating with EHR systems. The rest still use older standards such as HL7 v2, and Clinical Document Architecture (CDA).

Reliance on older standards can impede the adoption of new technologies and innovations that rely on FHIR’s capabilities, such as advanced analytics, mobile health apps, and patient engagement tools. Moreover, as regulatory requirements increasingly favor FHIR, healthcare institutions using older standards may face challenges meeting compliance deadlines and requirements.

The Office of the National Coordinator for Health IT (ONC) states that patients increased their use of apps to access their online medical records between 2020 and 2022, while web-only access to portals decreased. The API requirements, which ONC and the Centers for Medicare & Medicaid Services (CMS) rolled out to healthcare providers in 2023, have made electronic health information more widely available across smartphone apps.

Yet, suppose your healthcare software system still doesn’t support FHIR APIs. In that case, it may struggle to provide the level of access and integration that modern apps require, limiting patients’ ability to easily access and manage their health information via their preferred mobile platforms.

Obsolete healthcare software can be challenging to tailor to fit the specific requirements of your healthcare practice. Customization challenges can lead to inefficiencies and workarounds when your staff needs to adapt workflows to fit the software rather than the software supporting preferred processes.

According to the Software Intelligence report, an average application with 300,000 lines of code accumulates a technical debt of $1,083,000, meaning you’ll need to spend approximately $3.61 per line of code.

Decade-old healthcare software often consists of hundreds of thousands of lines of code, demanding substantial maintenance resources. Additionally, legacy infrastructure poses challenges in data storage, management, accessibility, and privacy concerns.

In 2023, the FBI’s Internet Crime Complaint Center (IC3) received 2,825 complaints identified as ransomware, which resulted in more than $59.6 million in losses. Ransomware attacks in the Healthcare and Public Health sectors were particularly prominent, with 249 reported incidents. 

Such growth is mainly due to outdated security protocols and a lack of modern cybersecurity features such as encryption and access controls in legacy health data management systems. These systems often store data on outdated servers vulnerable to cyber attacks.

Healthcare or pharmaceutical software that relies on obsolete technologies may find it difficult to integrate AI-based advanced reporting and analytics. Limited capabilities in this area mean your software cannot provide comprehensive insights or identify trends in terabits of health-related data. 

This may lead to inefficient resource allocation, longer patient wait times, and suboptimal staff and equipment scheduling.

Understanding the indicators of outdated healthcare software is crucial for organizations to maintain efficiency and compliance. Now that you know how to recognize when your systems are no longer meeting the demands of modern healthcare environments, it’s equally important to explore the different categories of legacy platforms that currently exist. This exploration will help you better understand each type’s challenges and limitations.

By categorizing these platforms, we can more effectively evaluate the most suitable paths for upgrading or replacing them to ensure optimal performance and patient care.

The US healthcare industry faced challenging conditions in 2023, including labor shortages, high inflation rates, and the ongoing impact of COVID-19. The industry has adapted to many of these and continued to move forward. Yet, legacy systems still perform critical functions but may lack interoperability, modern user interfaces, and scalability. 

Let’s now examine the primary types of legacy applications in healthcare and their unique characteristics.

Clinical software solutions encompass a range of applications that aim to streamline administrative tasks and help healthcare providers deliver better patient care while reducing costs and minimizing errors. When outdated, clinical software solutions can increase administrative burden, slow patient care processes, and increase the likelihood of mistakes.

Here are the major types of legacy clinical software systems hospitals and healthcare facilities still use and the weak sides they have.

• Electronic Health Records (EHR) systems store and manage patients’ medical history, diagnoses, treatment plans, allergies, and other important information in digital format. Legacy EHR systems may often be incompatible with other systems, leading to fragmented patient data across healthcare facilities. The use of different data formats is a significant factor contributing to this issue.
• Health Information Exchange (HIE) systems facilitate the transfer of healthcare information among different organizations, such as hospitals, clinics, and labs. Obsolete HIE systems often struggle with interoperability and lack real-time data access, making the seamless exchange of information challenging.
• Electronic Document Management Systems (EDMS) arrange documentation in a single digital repository, allowing the scanning and management of patients’ records electronically. These systems help reduce paper use and physical storage needs. As relatively new systems, EDMS usually don’t have critical issues, but it still may lack advanced search functionalities and integration with other clinical systems and AI-based tools.
• Clinical Decision Support Systems (CDSS) provide healthcare professionals with knowledge and patient-specific information to enhance decision-making processes for the last four decades. Legacy CDSS might not integrate well with EHR systems and offer limited decision-support capabilities due to outdated algorithms and data input methods. They can also be limited by the completeness and accuracy of their knowledge base. Modernizing CDSS into Non-Knowledge-Based SDSS allows clinicians to use AI/ML and statistical pattern recognition to learn from data and make predictions or decisions.

• Practice/Hospital Management Software (PMS/HMS) solutions handle the day-to-day operations of medical practices/hospitals, including patient admissions, scheduling, billing, reporting, and inventory management. Obsolete HMS can be cumbersome to use and may not integrate easily with modern EHR systems.

Outdated clinical software often lacks the integration capabilities needed to communicate seamlessly with other healthcare systems and technologies, resulting in fragmented patient data and hindered care coordination. Furthermore, the lack of regular updates and support can expose these systems to security vulnerabilities, putting sensitive patient information at risk. This can negatively impact patient trust and lead to potential legal and financial repercussions for healthcare providers.

PES provides a centralized system to manage all aspects of a patient’s engagement, including scheduling appointments, managing health-related data, and exchanging information with healthcare providers and pharmacies.

Here’s a detailed distribution of what PES covers and how obsolete solutions can limit patients’ proactive involvement in their healthcare journey.

• Patient portals allow patients to access their health information, communicate with healthcare providers, schedule appointments, and view test results. Legacy patient portals often have limited functionality, poor user interfaces, and may not provide real-time data updates.
• Telemedicine platforms enable remote consultations between patients and healthcare providers via video conferencing, chat, or phone. In 2024, over 116 million people used telemedicine consultations worldwide, up from around 57 million in 2019. However, obsolete telemedicine platforms may lack integration with EHR systems and offer limited functionality compared to modern solutions, affecting user experience and care continuity.
• Healthcare CRM (also known as patient relationship management software) enhances and centralizes the data and functionality of EHR software and patient engagement software. Legacy healthcare CRM systems often have basic functionality and may not integrate well with other healthcare software, limiting their effectiveness in building strong patient relationships.
• Healthcare AI chatbots provide automated, conversational interactions with patients for tasks like symptom checking, appointment scheduling, and answering common questions. Legacy chatbots are often based on rule-based logic and lack advanced natural language processing capabilities. While showing good results in handling basic inquiries and tasks, they often fall short in dealing with complex queries, natural language nuances, and context awareness. This leads to interactions that feel robotic, impersonal, and frustrating for customers seeking nuanced assistance.

Studies show that discomfort with the technology is a significant barrier, contributing to fewer than half of insured adult patients accessing online portals even during the initial stages of the pandemic. Maintaining a legacy tech stack makes this issue even worse.

These legacy solutions cover systems for managing various administrative, financial, and operational aspects of hospital operations.

Here are the most common types of legacy healthcare financial solutions.

• Medical billing software automates the billing process, including claims submission, payment tracking, and revenue cycle management. Legacy billing systems can be inefficient, with manual processes and limited integration with clinical systems, leading to billing errors, duplicate entries, and delays.
• Health insurance software helps manage insurance plans, claims processing, and policy administration. Outdated solutions may have limited integration with providers’ systems, resulting in inefficiencies and errors in claims management.
• Medical imaging and Picture Archiving and Communication Systems (PACS) store, retrieve, distribute, and present medical images. Legacy PACS might have slow image processing times, limited storage capacity, and poor integration with EHR systems, affecting the accessibility and sharing of imaging data.
• Healthcare staff scheduling software manages healthcare providers’ work schedules to ensure adequate staffing levels. Legacy scheduling systems often require manual input, lack flexibility, and do not integrate well with other hospital systems, leading to scheduling conflicts and inefficiencies.

To avoid these pitfalls, healthcare organizations must invest in regularly updating and maintaining their clinical software solutions. This ensures they remain compliant with the latest regulations, incorporate advancements in medical technology, and continue to provide a secure and effective means of delivering patient care. 

Good news: the latest KPMG survey highlights that over 55% of strategic investors identified electronic health records and virtual health, including telemedicine and remote monitoring, as highly attractive areas for investment in 2024. Additionally, more than 4 in 10 respondents ranked clinical workflow solutions and population health management similarly appealing.

Yet, the question still remains: replace or upgrade?

Despite the boost of digital transformation in healthcare after the start of the global COVID-19 pandemic, the debate between replacing and maintaining legacy systems is still critical and often disputable. Healthcare organizations worldwide face the challenge of managing increasingly outdated IT infrastructures while striving to meet modern demands for efficiency, security, and patient care quality.

So, should they invest their resources in upgrading or maintaining legacy healthcare platforms?

Here, we’ve compiled a table that compares the risks, benefits, and challenges associated with these two approaches against costs, operations, security, and other important aspects of healthcare software.

As you can see, replacing or maintaining a healthcare legacy system involves weighing the risks and benefits against organizational priorities, resources, and long-term strategic goals. While maintaining legacy systems may provide short-term cost savings, it often comes at the expense of security, efficiency, and compliance. Conversely, redeveloping offers improved functionality, security, and scalability opportunities but requires significant investment and careful management.

However, a complete replacement isn’t always the most appropriate approach to legacy system modernization. Based on your healthcare organization’s unique circumstances, regulatory requirements, and patient care goals, you may also opt for a gradual modernization or a comprehensive system overhaul.

Updating legacy healthcare software goes beyond adopting new technology; it’s about enhancing operational efficiency, ensuring data security, and delivering high-quality patient care. 

But when is updating the software enough, and when do you need to abandon it and build a new one from scratch? Let’s figure it out.

When to upgrade your legacy healthcare software?

• Satisfactory system performance. The existing system meets current performance requirements and can be enhanced with new features or optimizations without overhauling the entire infrastructure. For example, a hospital’s patient management system performs well but needs updated user interfaces and additional functionalities like telehealth integration. In most cases, you can develop additional features as new modules which communicate with the main platform via API.
• Flexible architecture. The established architecture allows for upgrades, given that the product does not rely on outdated, unsupported libraries.
• Limited time and resources. Upgrading can be a more cost-effective solution in the short to medium term and prolong the software’s life for a certain period, especially when upgrades are straightforward to implement and incur favorable cost and time expenses.
• Need to improve interoperability. The current system can potentially improve interoperability through enhancements or add-ons, integrating better with other systems or newer technologies. Upgrading, in this case, can extend its useful life.

When to replace your legacy healthcare software?

• Technological obsolescence. The existing system is based on outdated technology that cannot support new functionalities or security requirements. For example, when system is dependent on unsupported programming languages or frameworks should be redeveloped, otherwise it puts sensitive patient data at risk.
• Performance limitations. The system cannot handle the current workload or performance demands, causing significant delays, errors, and downtime.
• High security risks. Legacy systems often have security vulnerabilities that upgrades cannot adequately mitigate. A HIMSS survey states that legacy systems are the third biggest security risk to IT leaders in healthcare. If the system poses a high risk of data breaches or fails to meet modern cybersecurity standards, replacement becomes necessary.
• High maintenance costs. The cost of maintaining and supporting the legacy system is disproportionately high compared to the benefits (e.g., frequent breakdowns and the need for specialized knowledge to make fixes can make replacement more practical).
• Scalability issues. The system cannot scale to meet healthcare organizations’ growing demands. Newer systems may offer better scalability options to handle increased patient data and service requirements.
• Integration challenges. The legacy system struggles to integrate with newer technologies, devices, or applications essential for modern healthcare operations, such as EHRs, telemedicine, or advanced AI and data analytics tools.

Each decision to upgrade or replace should be based on a thorough assessment of the legacy solution, the organization’s specific needs, budget, and long-term goals.

Maintaining with small upkeep or completely replacing aren’t the only possible approaches to healthcare software modernization. Here are five more approaches that can be useful depending on the specific needs, resources, and constraints of the healthcare or pharmaceutical organization.

This approach involves gradually updating and improving the existing system in small, manageable steps rather than overhauling it all at once. Depending on your goal, you can opt for vertical or horizontal modernization — upgrading the system across all layers (backend, frontend, database) cohesively or layer by layer.  Both ways will help you minimize disruption to daily operations and allow staff to adapt gradually.

Advantages:

• Changes are made in small steps, minimizing the risk of major disruptions
• Costs are spread over time, making budgeting easier
• Users can adapt to changes gradually, improving acceptance and reducing training needs
• Allows for ongoing assessment and adjustment based on feedback and evolving requirements

Challenges:

• The complete modernization process can take a considerable amount of time
• Ensuring new components work seamlessly with old ones can be challenging

This approach involves breaking down the migration of your healthcare legacy system into distinct phases, focusing on individual modules or components at a time. Phased replacement ensures a controlled transition, minimizing the risk of system failures.

Advantages:

• Each phase can be carefully planned and executed, reducing the complexity of the project
• Allows continuous operation and improvement of the system

Challenges:

• Ensuring that new modules work well with the remaining legacy components
• Managing the system during the interim period when both old and new modules are in use

It proposes implementing the new system while also running the legacy one until the new system is fully functional and your business is ready to make the switch.

Advantages:

• If issues arise with the new system, the old system remains operational as a fallback
• You can try A/B testing and gather users’ feedback on the new system to maximize user acceptance 

Challenges:

• Simultaneously running two systems is more expensive
• Managing and synchronizing two systems can be complex and resource-intensive

Moving on-premises legacy healthcare system to a cloud-based infrastructure can involve rehosting (lifting and shifting existing applications to the cloud), replatforming (modifying applications to better suit the cloud environment), or refactoring (re-architecting applications to use cloud capabilities fully). The choice will depend on the specific needs of the healthcare organization, including factors like existing application architecture, scalability requirements, and budget constraints. 

Advantages:

• Easy resources scaling up or down based on demand
• Reducing costs associated with maintaining physical infrastructure
• Improved accessibility and collaboration with remote access capabilities
• Advanced security features and regular updates from cloud providers

Challenges:

• Ensuring the security and compliance of sensitive healthcare data during and after migration
• Potential downtime during the migration process

Developing APIs can enhance the legacy system and add new functionalities without a complete system overhaul. This approach allows legacy software to communicate with newer technologies, improving interoperability and extending the system’s lifespan. For example, integrating a legacy EHR application with a modern telehealth platform via APIs allows for seamless data exchange and enhances patient care.

Advantages:

• Adding new features and capabilities without rebuilding the entire system
• Improving interoperability with other systems and applications
• Minimal disruption to existing operations as the core legacy system remains in place

Challenges:

• Managing and maintaining APIs can be complex
• Ensuring secure API connections to protect data
• Ensuring compatibility between the legacy system and modern applications

As you can see, each approach has its advantages and challenges. With the right software development partner, you can carefully evaluate your software and plan and execute one or a combination of several modernization strategies to improve or redesign your legacy healthcare platform.

Despite COVID-19 significantly accelerating the digital transformation of the healthcare industry, many of the software solutions currently in use remain legacy and lack modern integrations. One of the primary reasons healthcare businesses continue to rely on these legacy systems is the fear of disrupting ongoing operations and potential data loss. However, prolonging the use of legacy solutions can lead to even more significant challenges and adverse outcomes.

Partnering with an experienced healthcare software development company like Leobit can help you overcome modernization challenges. We offer expertise in planning, personnel education, data migration, identifying use cases, roadmapping, and ensuring smooth, phased modernization. Contact us and we’ll help you navigate the complexities of upgrading your legacy systems while maintaining operational continuity and enhancing patient care.