Following record healthcare spending of $4.5 trillion in 2024—of which one-third was classified as wasteful—healthcare systems face mounting pressure to improve efficiency and cut costs without sacrificing quality. According to research from PwC, medical costs alone are projected to rise 7–8% in 2025, marking the highest increase in over 13 years. Immediate action is essential to shift from this unsustainable trajectory. 

Vendor consolidation, a strategy to streamline the number of technology providers, offers a promising solution. The fact is 88% of hospitals are already moving in this direction. By simplifying their technology landscape, health systems can significantly optimize costs, reduce provider burnout, and enhance patient care. 

Enhanced operational efficiency 

Fragmented systems with multiple vendors create inefficiencies, adding to the administrative burdens of healthcare workers. Managing disparate platforms can be overwhelming, leading to increased workload and stress. A study published in JMIR Medical Informatics highlights how excessive and poorly integrated technology contributes to healthcare worker exhaustion, hindering productivity and job satisfaction. Consolidating vendors simplifies workflows, reduces redundancies, and improves system usability, alleviating some stress on clinicians and staff. 

Unified platforms also streamline data integration, allowing healthcare teams to spend less time troubleshooting technology and more time focusing on patient care. For example, consolidated systems that integrate electronic health records (EHRs) and patient engagement tools enable smoother operations and enhanced communication. 

Cost savings 

Multiple vendors often mean duplicative costs, such as overlapping licenses, maintenance fees, and training expenses. Consolidation reduces these expenses, allowing healthcare systems to negotiate better pricing and allocate resources toward patient care and workforce well-being. 

Reducing hidden costs associated with inefficient technology management—such as time lost navigating disconnected systems—is also achievable.  

Streamlining platforms not only minimizes operational complexity but also reduces the time and resources required for legal contracting. This leads to greater staff satisfaction, enhanced morale, and reduced burnout among healthcare professionals. 

Improved clinical outcomes 

Fragmented systems hinder the ability to make data-driven decisions, which impacts patient care. Vendor consolidation resolves interoperability issues, creating centralized systems that provide clinicians with a comprehensive, on-demand view of patient data. This access enables faster, more informed decision-making, ultimately improving outcomes as interventions can be enacted more quickly. 

Consolidated platforms also integrate advanced analytics tools, helping providers identify at-risk patients and design targeted interventions. By reducing time spent navigating multiple systems, clinicians can focus on proactive, personalized care delivery. 

Scalability across use-cases 

According to the JMIR study, poorly integrated technology increases stress and hampers the adoption of innovative tools. Consolidating vendors ensures that health systems are positioned to embrace technological advancements without overburdening their workforce.  

Consolidated systems are designed for scalability and adaptability across use-cases and personas. Unified platforms can easily integrate emerging technologies like artificial intelligence (AI) and machine learning, enabling predictive analytics, workflow automation, and personalized care.  

Alleviating healthcare worker burnout 

The JMIR study underscores the critical link between technology overload and provider burnout. When systems are poorly designed or overly complex, they add cognitive strain to already-stressed healthcare workers.  

By consolidating vendors and investing in user-friendly, interoperable platforms, health systems can mitigate this strain, improving job satisfaction and reducing turnover in a field that is already drastically understaffed. According to the Association of America Medical Colleges, the U.S. will face a shortage of 86,000 physicians by 2036. 

Health systems should prioritize technologies that streamline workflows, minimize repetitive tasks, and integrate seamlessly. By doing so, they can foster a supportive environment where providers are empowered, not overwhelmed, by technology.  

Keys to successful vendor consolidation  

Point solutions in healthcare, which address specific needs like price transparency or musculoskeletal care, often create fragmentation within healthcare systems, leading to potential inefficiencies. With multiple standalone solutions, systems face increased administrative burdens, overlapping capabilities, and data silos, which can drive up costs as they manage multiple contracts and struggle with interoperability.  

This fragmented approach can also reduce user engagement, as employees may find it inconvenient to navigate a multitude of applications, reducing the likelihood of consistent usage and, by extension, the cost-effectiveness of each tool.  

Research suggests that integrated healthcare platforms, as opposed to point solutions, can streamline operations, enhance user satisfaction, and lead to more data-driven decisions which can, in turn, lead to better health outcomes.  

For health system leaders, this shift can lead to higher engagement and a greater return on investment by consolidating resources into a more cohesive ecosystem, reducing both administrative and care management costs. 

To maximize the benefits of vendor consolidation, healthcare organizations should: 

• Assess Needs: Identify inefficiencies and prioritize systems that reduce administrative burdens. 

• Engage Stakeholders: Include clinicians and staff in technology decisions to ensure solutions meet their needs. 

• Focus on Usability: Select platforms that are intuitive, user-friendly, and interoperable. 

Vendor consolidation is not just a cost-saving strategy; it’s a pathway to operational excellence, a healthier workforce and improved clinical outcomes. This strategic shift enables healthcare organizations to focus resources on what truly matters—patient outcomes—while making everyday operations smoother and more sustainable. 

This blog draws insights from The American Medical Association, PWC – Behind The Numbers 2025 FierceHealthcare, Spok, Phreesia, Snowflake’s Data Trends 2024: Healthcare and Life Sciences, and a JMIR Medical Informatics study highlighting the effects of technology overload on healthcare workers. Together, these sources illustrate how vendor consolidation can drive better outcomes for patients and providers.