INDUSTRY
Reducing Healthcare IT Costs Through Cloud Savings
The pressure on healthcare today is enormous. From staffing shortages and rising operational costs to regulatory demands and the ongoing need to stay competitive, hospitals and medical organizations are expected to do more with less, especially when it comes to IT. Budgets are tight, but data demands are never-ending.
Nowhere is this stress more evident than in healthcare data storage. Medical institutions are required to retain patient data for years—sometimes decades—under strict HIPAA compliance mandates. This means not only storing massive volumes of data securely, but also ensuring that it’s always accessible, available to auditors, and protected.
As cloud computing emerged and matured, its near-infinite scalability and flexibility made it seem like the perfect antidote for healthcare’s data storage challenges. But medical organizations quickly discovered that while cloud storage is convenient and aids compliance, it often comes with hidden costs.
Hospitals can be blindsided by complex billing structures, data access and retrieval fees, and the ongoing expense of storing inactive data long-term. Even the promise of "pay only for what you use" can quickly fall apart with unpredictable, budget-breaking bills.
Healthcare organizations need a smarter approach to cloud storage, one that allows them to take advantage of the inherent benefits of cloud storage without the surprise costs. The right cloud storage solution can help healthcare IT teams control costs with predictable economics, protect patient data and avoid ransomware, and ensure consumer-level simplicity in using the tools.
Understanding healthcare’s unique storage demands
To better understand the type of cloud storage solution healthcare organizations need, it’s important to be aware of the industry’s storage complexities. These challenges too often trickle down to affect IT budgets.
Long-term retention
Retaining patient data is a long-term necessity. A patient’s medical record is a critical document that informs care and treatment plans. Medical images, such as X-rays and MRI scans, are increasing in quality and resolution, which is an enormous help in identifying health issues, but which require greater storage capacity to keep them on file.
Industry regulations can mandate hospitals and other medical organizations to retain data such as patient records and images for up to two decades. In fact, some pediatric records must be kept until the patient reaches their 30s. If the data isn’t retained for the required period, compliance audit fines an be costly.
We have healthcare data going back to the 1990s that we’re required to keep. Our backups were taking a full weekend. We needed a solution that would not only help us affordably archive all our old data at a separate location but also ensure that the data is easily accessible any time a doctor or somebody must pull a file from whatever year.
Kevin Rhode, Chief Information Officer, District Medical Group
Backups
Because healthcare data is so critical to a physician’s ability to treat patients, data backups are vital in the industry. Backups can help aid compliance as they can be retained as needed, and they can also help organizations get through audits without incurring penalties.
Hospitals and other organizations also need to back up surveillance data regularly to ensure video footage is available in the event of an incident. Regulations around retaining video footage can differ from standard data retention mandates in healthcare, but are equally crucial to compliance.
Healthcare cloud costs are spiraling out of control
Long-term data storage, including backups, has become one of the biggest drains on the IT budgets of healthcare organizations—but the need for that storage retention is non-negotiable.
In the 2025 Wasabi Cloud Storage Index report, 57% of surveyed healthcare organizations exceeded their cloud storage budget in 2024. The reasons for the overspend varied:
Higher data operation fees than expected (48%)
Actual storage usage and growth was higher than forecast (37%)
Cloud providers increased base storage costs (48%)
Higher API call fees (puts/gets, reads/writes, restores) than expected (27%)
Higher data retrieval fees than expected (41%)
Higher data deletion fees than expected (25%)
Higher egress fees than expected (26%)
The data shows that healthcare IT budget expectations were seriously out of alignment with actual spending for a majority of healthcare organizations. One third of respondents reported that their spending on cloud storage “massively exceeded budget.”
One interesting point to highlight is that only 19% of data is considered “cold,” which means it’s accessed less than once per year. That means 81% of healthcare data is used and accessed more frequently.
Looking at the reasons for IT overspending above, four out of seven reasons pertain to data access. This shows that while healthcare organizations need to retain data for long periods of time, they also need to access it occasionally or often. And fees can add up quickly.
Surprise fees can wreak havoc on IT budgets and beyond
Cloud storage fees are having an obvious impact on the healthcare industry. When asked what percentage of their total cloud storage subscription bill was allocated to added-on fees, the number one answer from respondents in the Cloud Storage Index report was 31–40%. It’s no wonder, then, that a majority of organizations went over budget in 2024.
So what are these fees that are breaking budgets across the healthcare industry? They are small charges for a variety of actions you can take in your cloud storage. These actions include:
GET – Read or retrieve data
PUT – Change/modify data
API request/API call – Umbrella term for GET, PUT, and other operations; an API performs the operation
Egress – Transfer of data out of a storage location
On top of your base cloud storage costs, you can be charged a fee virtually every time you do anything with your stored data—access it, move it, change it, and even delete it.
Beyond breaking budgets, fees can also keep organizations from doing what they need to do. The Cloud Storage Index report found 53% of healthcare respondents indicated that egress/access fees either delayed or hindered their IT or business initiatives.
For example, the added fees could cause an organization to reduce how often you test and validate your backups. Or decide not to turn on immutability features that could increase cyber resiliency. Or put off retrieving data for analytics or AI initiatives. Fees could also be the reason an organization keeps data stored on a platform that doesn’t offer needed capabilities instead of moving it to a more suitable platform.
With extra fees causing so much pain across healthcare organizations, wouldn’t it be nice to find reliable cloud storage without them?
Eliminate fees and reduce cloud costs with Wasabi
Wasabi Hot Cloud Storage is the smart option for healthcare organizations that want affordable, predictable pricing with no surprise fees that can wreak havoc on their IT budget. We provide a single tier of accessible, high-performance storage for all of your data regardless of how often you need to access it.
With clinical archives, we can’t predict when or how much data we’ll need to retrieve. That’s why Wasabi’s no-egress-fee model was such a benefit. We can access hundreds of gigabytes weekly without worrying about surprise costs.
Yusuf Mangera, Technical Architect, Imperial College Healthcare NHS Trust
You won’t be charged for egress, API calls, and other operations that boost cloud storage costs sky-high. You pay a simple monthly fee per TB and that’s it. We also offer Wasabi Account Cloud Manager, an easy-to-use, intuitive console that provides centralized management and provisioning of cloud storage resources across the organization.
Our cloud storage is simple to use and doesn’t require complex tools or skillsets. But don’t let the simplicity and predictable pricing make you think that our storage services can’t stand up to our hyperscaler competition.
With Wasabi, you get solid support and free, advanced security features to keep your most sensitive data protected. We aid compliance with HIPAA and other stringent industry regulations when it comes to privacy and security—with tools like Multi-User Authentication to prevent one single person from deleting data, immutability through object lock, egress monitoring and bucket logging, and free, secure replication.
Wasabi is the ideal solution for data backups and archives you can access when you need them. And advanced security features and capabilities make Wasabi a strong component in any ransomware or other data protection strategy.
Conclusion
With all the pressure to control costs without reducing quality of service, healthcare organizations need to rethink cloud storage to find solutions that deliver the flexibility and scalability they require at a cost they can predict.
Wasabi fulfills that need and has helped many healthcare organizations with our secure, easy-to-use, and cost-effective cloud platform. By keeping costs in line with expectations, we give healthcare providers peace of mind that their data is stored securely and accessible anytime at no extra charge. And by eliminating the surprise fees that eat up budgets, we enable organizations to put those funds into other strategic areas—where they can focus on delivering new patient services and improving outcomes.
analyst report
Navigating healthcare workflows with smarter infrastructure
Explore this free IDC report to learn how to safeguard patient data, contain costs, and automate compliance across mission-critical diagnostic and operational workflows.
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