Server- or Cloud-based Practice Management Software: Which to choose for your medical office

Server- or Cloud-based Practice Management Software: Which one should you choose for Your medical office?

When it comes to choosing the best practice management software for your medical office, you need to consider lots of factors that will influence your workflow. In this article, we would recommend you to pay attention to the comparison of cloud-based and server-based PMS and make your own choice.

Quick navigation

Practice management software (PMS) is an integral part of a streamlined business process in independent medical practice. There are currently two main options for practice management systems – cloud-based (also known as web-based) and server-based medical practice software.

Cloud-based solutions have grown in popularity because they have some distinct advantages over server-based ones. However, server-based solutions have their own benefits. Making a choice is not hard if you know what you need.

We’ll explain the basic differences between cloud-based and server-based practice management solutions, and give you some tips on choosing the right one for your practice. We’ll also provide insights on whether developing a custom solution from scratch is the best approach.

Practice management systems in healthcare are a growing market because virtual cloud-based service systems allow offshore companies to provide services at competitive prices. According to Market Watch, the medical practice management software market is forecast to reach $5698.2 million by 2025.

We’ll start by explaining what medical practice management software is. A medical PMS is healthcare management software that helps medical organizations including clinics and practices to manage their operations which record patient data, schedule appointments with practitioners, maintain records of insurance payments, perform billing tasks and generate final reports.

Electronic medical records (EMRs), electronic health records (EHRs), and practice management software are integrated to allow healthcare facilities to manage medical data on patients and facilitate other aspects of a medical facility’s operations in an all-inclusive data management system.

What is a server-based practice management system?

Server-based solutions for practice management are hosted on a network, and the server is based on your premises. It provides all the functionality of a healthcare practice management software and is stored and managed at your office location If you use this approach, you manage your patient data in-house on local servers, and your staff performs the maintenance, security, and upgrades of software and hardware.

What is a cloud-based practice management system?

Cloud-based practice management software provides the same functionality as a client-based server, but all the information is stored outside your office in the cloud and accessed remotely through an Internet browser or application interface.

The way the solution is hosted is the fundamental difference, however, there are several other distinctions.

Differences between server-based and cloud-based practice management systems

The main differences between the two types of solutions regarding how information is handled. Below are the key differences when it comes to data:

How information is stored

A cloud-based medical document management system stores all the information in the cloud, and it is backed up by data security centers.

Server-based practice management software stores all the data on physical servers located on the site of the medical practice, and server management is performed by IT staff or is outsourced to an IT provider.

How information is accessed

Cloud-based practice management software allows you to access your data from anywhere, at any time, and on any device, since your data is not bound to a physical server. The cloud is accessible via the Internet, which is very useful for those who provide remote care.

A server-based PMS provides access to data only within the medical practice where the server is located. It can only be used on the premises of the practice, and only on designated computers by authorized people who are granted access.

How information is maintained

The way the solution is hosted defines how maintenance and system upgrades are performed. With server-based medical practice management systems, all maintenance and system upgrades (both software and hardware) are performed by your staff or outsourced. Cooling equipment and power delivery are also the responsibility of the medical practice where the servers are physically located.

With cloud-based systems, updates are the responsibility of the provider and are performed automatically by them.

How information is integrated

Cloud-based patient management systems are generally integrated with a wide range of other cloud-based custom healthcare software solutions (e.g., online booking apps and wellness apps) as well as business solutions (various internet-based payment and billing systems).

Server-based PMS can be more challenging in terms of interoperability and integration due to the specific architecture of the systems and equipment used.

Read also: How to choose between ready-made and custom EHR solution

Advantages and disadvantages of cloud practice management system

The advantages of this type of PMS are:


Practice management software powered by cloud technology is accessible on any device that has access to the Internet. You can use a desktop computer, laptop, Macbook, tablet, iPad, or smartphone, and provide care from wherever you are.

Budget saving

Cloud-based therapy practice management software and even cloud-based veterinary software can be less costly than server-based solutions as you don’t have to make the initial investment in software and installation, and you don’t have to purchase servers, cooling equipment, and electricity to power them. You’ll also save when it comes to upgrades and maintenance. This is a great choice for practice management software for a startup clinic because of the cost savings.

Easy to use and maintain

With cloud-based solutions, all technical issues are the responsibility of the provider, and timely updates from them will make your software cost-efficient, easy to use, bug-free, and feature-rich. Upgrades are performed automatically – often overnight – which means little or no downtime for users. In most cases, these upgrades are free of charge. Moreover, most companies generally provide technical support 24/7 year-round, which is great for small independent practices that can’t afford a highly-skilled IT specialist on the payroll.

Scalability and interoperability

Different types of clinics have different needs, so mental health or dental practice management software will each have their own specific features. The scalability of specialist practice management software is a great advantage of cloud-based solutions. You can add features as your practice grows, and pay as you use. Also, with cloud-based solutions, it is relatively easy to add new users, doctors, or locations. Moreover, cloud-based PMS can be integrated with other cloud-based healthcare and business solutions, and this means your practice is more equipped to be a part of a state-of-the-art digital ecosystem that allows interoperability and integration.

Remote care

Certain solutions technically can’t be server-based. For example, telemedicine requires connections between different clinics and specialists, and medical data must be synchronized in every facility.

No need for special infrastructure and staff

Cloud solutions don’t require significant training and additional infrastructure for a medical practice.

Data backup and security

Cloud systems achieve HIPAA compliance and compliance with other regulations (e.g. the HITECH Act and HITRUST Common Security Framework) through data centers. These centers provide bank-level security and high-level encryption methods, which means your data is unreadable even if a security breach occurs. If you store information in the cloud, your practice can also be more protected in the event of a catastrophe, which is useful for practices located in places affected by hurricanes.

Disadvantages of cloud-based PMS include:

Internet dependency

Cloud-based PMS applications run on the Internet. If an Internet connection is unavailable or of poor quality, the PMS application will not function properly so to ensure the quality you need to have a stable Internet connection.

Possible downtime

Downtime due to maintenance and other issues are possible, though most cloud software vendors and providers ensure 99.9% uptime.

EMR implementation How Why When

Advantages and disadvantages of a server-based practice management system

The advantages of server-based PMS are:

More compliance with regulations in certain countries

Some countries have very strict regulations regarding the Internet and the security of protected health information (PHI). These security issues require big capital investments that are unaffordable for small practices.

The same functionality as cloud-based solutions

You can get the same functions as you would if you chose a solution in the cloud.

Can be tailored for the specific needs and equipment of a medical practice

The disadvantages of on-premises solutions include:

Capital investment and ongoing costs

You have to purchase both software and hardware and maintain it on your own.

Maintenance and updates are your responsibility

You need to have your own trained staff to perform maintenance and updates or involve a third-party IT provider to help you maintain and upgrade the software. Some server-based solutions allow upgrades via the Internet, and some are upgraded with the help of physical data storage units. Sometimes you have to wait until a provider’s technician arrives to perform maintenance or an upgrade, and this can mean downtime and inconvenience for your staff.

Backup and security

Backups can be vulnerable to a data breach. Server-based systems are often left unencrypted, and the only security measure is a password on the computer and a digital access lock on the door of the server room, which leaves data at risk of compromise or even removal and theft.

Lack of interoperability with cloud-based services and applications

Lack of interoperability and integration with a cloud-based infrastructure means there are numerous advantages for your practice and your patients that you may not have access to.

Server or cloud – what is the best choice for your medical facility?

The design of a PMS depends on the volume of data that needs to be maintained, the size of the organization, and the financial means of the medical practice. Generally, in terms of finance, medical management software can be divided into several categories: desktop variants for limited computers, physical client-server solutions for large and financially-backed institutions with requirements for easy access to a patient’s confidential data, and cloud server solutions for practices that require cost-saving alternatives. The price tag will also depend on the functionality of the solution and its scale. Integrated systems (EMR/EHR and PMS) are more expensive than standalone services.

A practice management system can be costly, so you have to make sure your decision will serve you well for many years. Take into account all the advantages and disadvantages and think ahead – try to predict which features and interoperability you will need in the future.

Whatever your decision is – whether that is to buy a ready-made solution or to develop your own cloud or server-based PMS – here is a list of things that need to be considered.

Practice management software questions to answer

  • Which areas have to be streamlined and improved to minimize admin burden and automate workflow?
  • Do you have the time and money to maintain hardware, network infrastructure, and IT support? This is a crucial consideration when deciding between a server- or cloud-based PMS.
  • Are there plans to expand your practice, either with additional providers or a partner facility?
  • Does your solution need to communicate with health information exchanges (HIEs) or other technologies to meet coordinated care standards?
  • Will you need access to your medical record and practice data from your mobile device at any time from any location?
  • Does the PMS solution need to be integrated with other systems like accounting?
  • Do you need a mobile solution for home visits, remote care, and elderly care?

Choose a system that is easy to set up, understand, and navigate, and one which ensures the strictest data security measures. If you don’t see an ideal solution on the market, you can develop a custom one tailored for your specific needs.

Get in touch with us at to get more information about cloud-based solutions in healthcare.

Talk to PM