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Optimizing Costs and Powering Better Population Health with the Cloud


Health and human services agencies continue to amass large amounts of data, from information on utilization rates and program costs to data on provider and facility performance.

Health and human services agencies continue to amass large amounts of data, from information on utilization rates and program costs to data on provider and facility performance.

Making sense of all this data is key for these agencies to improve care quality and better manage costs for state programs, which means they need partners with proven health solutions and deep healthcare expertise.

Telligen, a mission-driven healthcare technology company, helps employers and health plans, federal health agencies, and state Medicaid programs improve outcomes and care delivery with quality analytics and a range of population health management solutions and services. The company’s solutions impact 36 million people covered by federal and state healthcare programs and commercial markets, including the Quality Innovation Network for Iowa, Illinois, Oklahoma, and Colorado and state Medicaid agencies in Colorado, Idaho, Iowa, Maryland, Massachusetts, Montana, Nebraska, Oklahoma, and Virginia.

Telligen has been serving these agencies for several years and continues to expand nationwide. To better support new and existing customers, Telligen began considering migration to the cloud in 2018 as a way to improve its business agility and create opportunities for innovation.

As an Amazon Web Services (AWS) Partner, Telligen turned to AWS Cloud solutions and services to accomplish these goals, and significantly enhanced its computing capabilities in the process. The company’s collaboration with AWS shows the benefits government software providers can reap by moving from on-premises infrastructure to the cloud.

Dealing with the challenges of an on-premises environment

Telligen has been in the government technology space for more than 25 years, at one point managing all of Medicare’s claims data for the Centers for Medicare and Medicaid Services (CMS).

Until a couple of years ago, the company still maintained on-premises data center operations for all its client systems and solutions. Because each state has different system requirements, the company must be agile when it comes to application development, maintenance, and reliability.

After assessing their computing environment and determining what technology investments would be most transformative for their business, Telligen leaders decided moving to the cloud was the best option.

“We evaluated whether it made sense for us to continue to maintain our own data center or to look for a cloud hosting solution,” says Brian Barry, Telligen’s chief information officer. “Ultimately, as we went through that process, we realized that for us to continue to be competitive in the market and to really take advantage of new technologies and trending innovations, our best strategy was to look to the cloud as opposed to continuing to maintain our own on-premises database.”

In 2019, Telligen began moving its client systems and some of its internal workloads to the cloud. Telligen IT Director Mike Koschmeder says the company decided to move technologies like its quality measurement, reporting and performance improvement solutions to AWS “because AWS is a market leader for government cloud solutions.”

In addition, many of Telligen’s federal government customers were already using the AWS Cloud. “There are plenty of other cloud providers — we understood that. But as we looked at all the services and products AWS could offer and learned they were adding more all the time, those were just some of the main reasons we selected AWS,” says Koschmeder.

Organization alignment to drive migration

Currently, a little more than 50 percent of the company’s systems are hosted in AWS, while the remainder are still on-premises.

Migrating very sensitive workloads takes time and Telligen has been deliberate about the process, closely collaborating with its AWS account team — especially the AWS Cloud Financial Management Team — to ensure its migration is successful and that it continues to best serve its government customers during the transition.

Working with the AWS team, Telligen took several initial steps to position itself for a seamless migration, starting with a cloud readiness assessment.

“The cloud readiness assessment allowed us to get a handle on if we were ready to do all the migration steps required and suggested by AWS to have success in the cloud,” Koschmeder says. “On our own, we also created an AWS playbook that outlined a structure for us to follow and to consider for anything we wanted to move from on-premises to AWS.”

Telligen also created a cross-functional steering committee that met bi-weekly to help guide the migration and ensure the company followed its playbook. In addition, it developed a robust training plan aligned with the different functional areas of the AWS Cloud infrastructure that its teams would be responsible for. Koschmeder says doing all this groundwork has led to more structure for what applications Telligen creates in AWS. It also helps the company ensure these applications meet AWS’s well-architected framework for building highly secure, scalable, and efficient applications and workloads anchored around the key pillars of operational excellence, security, reliability, performance efficiency, and cost optimization.

Optimizing costs every step of the way

Cost optimization has been a key part of Telligen’s collaboration with AWS. The account team brought in a cost optimization strategist to help identify opportunities for cost savings, which led to AWS recommending Telligen begin using AWS Savings Plans.

AWS Savings Plans offer government technology providers a flexible pricing model to reserve capacity over a longer time frame at a discounted rate. Srinivas Velamuri, an enterprise architect for Telligen, says AWS Savings Plans allow Telligen to manage its constantly evolving workloads more cost effectively.

“With Savings Plans, we can choose whatever instance type [memory, storage, and network capacity] we want and even access instance types on demand. We don’t need to worry about reserving them, so it gives us more flexibility and agility,” Velamuri says.

Walt Rumpf, an account manager at AWS who works closely with the Telligen team, says AWS works with Telligen to recommend how the company can reduce its costs. “We were able to set up automation that allowed them to spend down during non-peak hours. We’ve also recommended Savings Plans and helped them move to that model to generate more cost savings,” Rumpf says.

“It has allowed them to increase their agility, experiment more, reduce their costs over the long term, and avoid another hardware refresh since these workloads have now been migrated to the cloud.”

AWS gives government technology providers several cost optimization tools that improve financial management of cloud resources. It provides dashboards, AWS Cost Explorer, and AWS Budget tools and billing file analysis to help customers gain greater cost visibility and cost control. They also can see their monthly cost by service, such as instance type or usage type.

AWS also helps government technology providers right-size their workloads before they migrate, so they are better positioned to balance costs with their performance needs even before they transition to the cloud. Rumpf says AWS helped Telligen reduce its hardware costs premigration by monitoring its workloads and then worked with another AWS Partner, ReluTech, to renegotiate maintenance contracts with original equipment manufacturers to significantly reduce the ongoing maintenance costs within Telligen’s data centers.

“AWS is trying to enter a win-win relationship — that’s what we learned along the way,” Barry says. “We don’t have any other partners who are trying to optimize costs as we implement more of their services, but with AWS, it seems more like the goal is win-win. We’ve realized that AWS can help us with the products and services they offer and implementing more of those products and services helps us on the backend with our availability, reliability, and cost structure.”

Telligen has used all these benefits to its advantage to better serve the public and its government customers. Velamuri says Telligen launched a contact tracing application this year as states grappled with the pandemic. The company offered the free app, which was hosted in AWS, to nursing homes, schools, and other organizations across the country.

“We were able to stand up this app in the cloud within two weeks. It is something we did for our community. Usually this would have taken months,” Velamuri says.

Telligen plans to transition the remainder of its systems to AWS by 2021. Though it is hard to measure the overall cost savings the company has generated in the last year by moving to the cloud, Koschmeder says the benefits are clear.

“It’s hard to quantify, but the opposite approach would have been to purchase infrastructure for our data center and be stuck with the cost for five years, regardless of how much we used it,” he says. “We need to be scalable for our contracts, so now we can swing up very high when we have to process more load and dial it back down when that’s completed. You can’t do that with on-premises infrastructure.”

Barry adds that in addition to costs, there was an even greater risk.

“Along with being expensive, there was the risk of not meeting the customer’s expectations. That is the other thing in an on-premises environment — you can’t be agile. You can’t quickly adjust. The ability to do this in the cloud and to be more responsive ultimately leads to happier customers.”