What Is the Difference Between Shared Cloud, Dedicated Cloud, and On-Premises Hosting for Healthc…

Shared cloud environments use multi-tenant infrastructure managed by a provider. Dedicated cloud environments allocate isolated resources to a single organization within a provider’s data center. On-premises hosting places physical servers inside the healthcare organization’s own facilities.

Each model can support HIPAA-compliant deployments when properly configured, but they differ significantly in governance burden, accountability, and long-term operational flexibility. This comparison focuses specifically on infrastructure isolation and governance differences — not broader deployment architecture strategy.

Why Infrastructure Isolation Matters in Healthcare

Healthcare systems process protected health information (PHI), clinical documentation, secure messaging threads, and telehealth video data. How infrastructure is segmented and controlled directly affects:

• Data isolation boundaries
• Access governance
• Disaster recovery design
• Compliance oversight
• Internal IT workload

Hosting architecture is not just a technical decision — it shapes how securely healthcare applications operate at scale.

This page evaluates how isolation level affects governance burden and operational accountability across healthcare hosting models.

In healthcare, isolation level influences governance complexity more than compliance eligibility.

1. Shared Cloud Hosting (Multi-Tenant Model)

Shared cloud environments host multiple organizations within the same physical infrastructure. Resources such as compute, storage, and networking are logically separated but physically shared.

Characteristics

• Multi-tenant architecture
• Provider-managed hardware
• Elastic scalability
• Lower upfront cost
• Standardized configuration

Healthcare Implications

Shared cloud deployments are commonly used by telehealth providers, digital health startups, and healthcare SaaS platforms.

When deployed under a signed Business Associate Agreement (BAA) and properly configured with encryption, access controls, and audit logging, shared cloud can support HIPAA requirements.

However, infrastructure customization may be limited compared to dedicated or on-prem models. Organizations operate within provider-defined architectural boundaries.

This model prioritizes operational efficiency and scalability.

2. Dedicated Cloud Hosting (Single-Tenant Allocation)

Dedicated cloud environments allocate isolated infrastructure resources exclusively to one healthcare organization while still leveraging the provider’s data center and virtualization platform.

Characteristics

• Single-tenant infrastructure
• Increased logical isolation
• Greater network segmentation control
• Higher cost than shared cloud
• More customization flexibility

Healthcare Implications

Dedicated cloud hosting is often selected by:

• Large hospital systems
• Multi-location provider networks
• Organizations managing high patient volumes

It provides stronger isolation without requiring internal hardware ownership.

Dedicated cloud increases configuration control without requiring physical infrastructure management.

This model often strikes a balance between operational manageability and infrastructure control.

3. On-Premises Hosting (Self-Managed Infrastructure)

On-premises hosting places physical servers within the healthcare organization’s own facilities.

Characteristics

• Full physical custody of hardware
• Internal IT management
• Capital hardware investment
• Slower horizontal scaling
• Complete infrastructure responsibility

Healthcare Implications

On-premises environments may be chosen when:

• Internal policy mandates physical control
• Regulatory considerations require internal hosting
• Organizations maintain mature IT departments

However, this model shifts full responsibility for:

• Physical security
• Environmental controls
• Network protection
• Backup infrastructure
• Incident response planning

On-premises hosting offers maximum control — and maximum accountability.

While it provides strong governance authority, it requires significant operational resources.

Comparison Overview

Compliance Considerations Across All Models

No hosting model is inherently HIPAA compliant by default. Compliance depends on:

• Proper encryption implementation
• Role-based access controls
• Audit logging and monitoring
• Signed Business Associate Agreements
• Documented governance processes

The hosting label alone does not determine regulatory posture — configuration, oversight, and risk management do.

Healthcare organizations must evaluate which isolation model aligns with their governance maturity, internal IT capacity, and risk tolerance.

QuickBlox communication APIs and SDKs can be deployed across shared cloud, dedicated cloud, and enterprise-controlled hosting environments depending on organizational requirements.

For a broader overview of hosting deployment models — including hybrid architecture, VPC environments, and integration strategy — see our guide to hosting deployment models for healthcare communication platforms.