SaaS sounds interesting for many of the reasons given. In my experience, however, cloud computing isn't mature enough for "mission critical" software services as yet, so I would always want the possibility to cache a portion of the database on my local network to allow me to work at some basic level when SaaS goes down.
There is not only the possibility of an extended interruption of the local internet connection as was mentioned above -- major online providers are regularly down. I have used Google Docs for a few years now, and there are infrequent but often prolonged service interruptions (in spite of Google's massive server redundancy). As many Blackberry users are aware, RIM is reporting yet another BB email failure since yesterday. And as Jon posted recently, the Practice Fusion message boards are full of posts about SaaS outages.
Don't even get me started about security of patient records. According to news reports, the hacker group Anonymous managed to record a confidential internet communication between law enforcement bodies in the US and the UK.
There are a lot of issues to solve.
