How to justify the cost of custom healthcare software to stakeholders
Investing in custom healthcare software development is a significant financial decision for any healthcare organisation. While off-the-shelf solutions may seem cost-effective upfront, they often fail to address unique operational needs, leading to inefficiencies and workarounds that compromise long-term value.
However, securing stakeholder buy-in for tech-enabled care initiatives requires more than just highlighting potential benefits. Decision-makers, whether executives, finance teams, or clinical leads, will scrutinise the cost, expected return on investment (ROI), and potential risks. Understanding how to present a compelling case that acknowledges both the rewards and the challenges can make all the difference in getting approval for a UK health tech investment.
This guide explores how to justify the cost of custom healthcare software while addressing common concerns and demonstrating clear financial and operational benefits.
Why custom healthcare software is worth the investment
While off-the-shelf software can meet general needs, custom healthcare software development ensures that solutions are tailored to an organisation’s specific workflows, compliance requirements, and long-term goals. The key advantages include:
Seamless integration – Custom solutions align with existing IT infrastructure, reducing inefficiencies caused by disconnected systems.
Scalability and flexibility – Software can be adapted as patient demand grows or regulations change, avoiding costly replacements.
Enhanced security and compliance – UK healthcare providers must adhere to strict GDPR and NHS Digital security standards, which custom software can be designed to meet from the outset.
Process automation – Reduces administrative burden, allowing staff to focus on patient care instead of repetitive tasks.
Improved patient outcomes – Custom solutions ensure faster, more reliable access to accurate patient data, leading to better clinical decision-making.
Despite these benefits, stakeholders may be hesitant to approve custom development due to perceived costs and risks. A well-structured business case can help address these concerns.
Building a strong business case for custom healthcare software
To justify the investment, healthcare organisations must present a clear, evidence-backed case that demonstrates why custom software is the right choice. Here’s how to structure the argument:
1. Define the core problem and impact
Stakeholders need to see why an investment is necessary. Clearly outline the challenges your organisation faces with existing systems and quantify their impact.
Operational inefficiencies – Manual processes increase administrative workload and delay patient care.
Compliance risks – Legacy systems often struggle to meet evolving data protection and security regulations.
Cost inefficiencies – Unnecessary licensing fees, manual workarounds, and staff productivity losses add up.
Example: “Our current scheduling system results in 1,500 lost clinical hours per year due to inefficient shift management. A tailored scheduling solution could significantly reduce this burden and improve staff allocation.”
2. Calculate the return on investment (ROI)
Stakeholders will want financial justification for the project. While ROI can be complex in healthcare, key metrics include:
Time savings – How much staff time will be saved annually through automation?
Cost reductions – Will the software reduce reliance on temporary staff, lower administrative overheads, or decrease costly errors?
Revenue generation – Will improved efficiency enable more patient appointments, increasing revenue?
A cost-benefit analysis should be provided, showing the upfront investment versus projected long-term savings.
Example: “Through automation, we can improve productivity and increase the value of time by £12.5 billion a year as the NHS did.
3. Address implementation risks openly
Every investment carries risks, and stakeholders will appreciate an honest assessment of potential challenges. Common concerns include:
Development delays – Custom software projects can take time to develop and refine.
Adoption barriers – Staff may resist new systems if training and support are inadequate.
Hidden costs – Maintenance, updates, and ongoing support must be factored in.
Mitigation strategies should be part of the discussion:
Agile development – Break the project into phases to ensure early value delivery.
User involvement – Engage end-users early to increase adoption and reduce resistance.
Transparent budgeting – Outline expected maintenance costs upfront to prevent surprises.
Example: “To minimise disruption, we will roll out the software in three phases, starting with a pilot in a single department before full implementation.”
4. Showcase industry benchmarks and case studies
Stakeholders may need reassurance that custom healthcare software development is a viable strategy. Present real-world examples, preferably from UK health tech, showing successful implementations.
Case studies from NHS trusts – Demonstrating measurable improvements from tailored digital solutions.
Benchmarking against competitors – How similar organisations have benefited from custom solutions.
Regulatory compliance examples – Showing how the solution aligns with NHS and GDPR requirements.
Example: “An NHS digital transformation report found that they reduced Did Not Attends, unnecessary clinical follow-ups and appointments, and cancelled procedures.”
5. Align with long-term strategic goals
Stakeholders are more likely to approve investments that align with broader organisational priorities, such as:
Digital transformation objectives – Aligning with NHS Long Term Plan strategies.
Cost efficiency mandates – Reducing operational costs without compromising care quality.
Future-proofing IT infrastructure – Ensuring compatibility with emerging technologies.
Example: “This project aligns with our five-year digital roadmap, ensuring our systems are adaptable for future NHS interoperability requirements.”Step 4: Train staff and support patient adoption
Successful telehealth implementation depends on staff and patient engagement. To drive adoption:
For healthcare professionals:
Provide comprehensive training on using telehealth platforms effectively.
Offer guidance on conducting virtual consultations with the same level of professionalism as in-person visits.
Establish protocols for handling technical issues, patient concerns, and digital accessibility challenges.
Encourage feedback from clinicians to refine workflows and improve the telehealth experience.
For patients:
Educate patients on how to use telehealth services through tutorials, webinars, or step-by-step guides.
Ensure accessibility for elderly and vulnerable patients, including telephone support options.
Offer clear communication on when telehealth is appropriate and when an in-person visit is necessary.
Provide multilingual resources to accommodate diverse patient populations.
Proactively addressing staff and patient concerns increases the likelihood of long-term telehealth adoption, ensuring continued success.
Step 5: Plan for long-term financial and operational sustainability
For telehealth to be a long-term success, healthcare organisations must ensure financial and operational sustainability. Key considerations include:
Cost management – Assess the total cost of ownership, including licensing fees, infrastructure upgrades, and ongoing maintenance.
Reimbursement and funding – Funding sources and reimbursement policies vary between NHS and private healthcare organisations. Understanding these options ensures financial sustainability.
For NHS providers – Understand NHS reimbursement policies for telehealth services and explore available funding options.
For private healthcare organisations – Evaluate insurance coverage models, direct-to-consumer pricing strategies, and potential partnerships with insurers to support telehealth adoption.
Scalability – Choose solutions that can grow with patient demand and adapt to future NHS digital strategies.
Operational oversight – Assign dedicated teams to monitor service quality, patient satisfaction, and cost-effectiveness over time.
A strategic financial and operational plan ensures that telehealth remains a viable, cost-effective healthcare solution.
Justifying the cost while recognising the risks
A well-planned custom healthcare software development project brings substantial benefits, but it’s crucial to approach stakeholders with a balanced view—highlighting not just the opportunities but also the challenges and how to mitigate them. Transparency builds trust, and acknowledging potential risks upfront ensures decision-makers feel more confident about moving forward.
1. Initial investment vs. long-term value
The upfront cost of custom software can seem daunting, especially compared to off-the-shelf solutions. However, many healthcare organisations recoup these expenses through:
Operational savings – Automating administrative tasks reduces the need for manual data entry, decreasing staffing costs and freeing up resources.
Improved efficiency – Faster workflows, fewer errors, and optimised scheduling lead to better patient care and reduced delays.
Scalability – Unlike rigid commercial software, a custom-built solution grows with the organisation, avoiding expensive migrations later.
Mitigation strategy: Create a cost-benefit analysis that compares initial costs with long-term savings and efficiency gains. Use industry benchmarks or case studies to strengthen your justification.
2. Development complexity and project scope creep
Healthcare software projects often face scope creep, leading to extended timelines and increased costs. Complex integrations with NHS systems, EHRs, and compliance requirements can add unforeseen challenges.
Mitigation strategy: Adopt agile development with phased implementation. This approach ensures that critical functionalities are delivered first, while additional features are rolled out based on evolving needs. Setting clear milestones and budget controls prevents uncontrolled expansion.
3. Staff resistance and adoption challenges
Even the most advanced software will fail if clinicians and administrative staff struggle to adopt it. Resistance to change is a common challenge in healthcare, where staff are already burdened with high workloads.
Mitigation strategy:
Involve end users early – Consult staff during the design phase to ensure the system aligns with their workflows.
Provide training – Offer role-based training that is practical and interactive, ensuring staff feel confident using the software.
Appoint champions – Identify key personnel to advocate for the system and support their colleagues during implementation.
The NHS has a framework that can be used as a reference to help healthcare organisations and companies make the shift to digital tools.
4. Security and compliance risks
Custom healthcare software must align with GDPR, NHS security frameworks, and data protection best practices. A single oversight in compliance could result in costly fines or data breaches, making security a top concern for stakeholders.
Mitigation strategy:
Implement end-to-end encryption to safeguard patient data in storage and transit.
Use role-based access controls (RBAC) to restrict system access based on job function.
Regularly conduct penetration testing and security audits to identify vulnerabilities before deployment.
Ensure the system aligns with NHS Digital’s Data Security and Protection Toolkit to guarantee compliance.
5. Ongoing maintenance and long-term sustainability
Custom software isn’t a one-time expense—it requires continuous maintenance, updates, and cybersecurity reinforcements. Without proper planning, hidden costs can emerge.
Mitigation strategy:
Establish a clear maintenance contract with the development team, covering updates, patches, and support.
Choose a modular system architecture, allowing incremental improvements without overhauling the entire platform.
Conduct regular performance reviews to ensure the software remains aligned with organisational needs and industry standards.
Making the case for stakeholders
By presenting a realistic, well-prepared argument that outlines both the potential risks and their solutions, healthcare organisations can build stakeholder confidence. Custom healthcare software development is an investment, but with the right planning, risk management, and implementation strategy, it delivers long-term value through efficiency, security, and adaptability.
Custom software has the power to transform healthcare operations, but making the case for investment requires clear financial justification, strategic alignment, and proactive risk management.
If your organisation is considering custom healthcare software development, let’s explore how we can build a solution tailored to your needs. Book a discovery call with Adapt Digital today.
