Cloud computing is a new way of delivering computing resources and services. Many managers and experts believe that it can improve health care services, benefit health care research, and change the face of health information technology. However, as with any innovation, cloud computing should be rigorously evaluated before its widespread adoption. This paper discusses the concept and its current place in health care, and uses 4 aspects (management, technology, security, and legal) to evaluate the opportunities and challenges of this computing model. Strategic planning that could be used by a health organization to determine its direction, strategy, and resource allocation when it has decided to migrate from traditional to cloud-based health services is also discussed.