Today I got a call from an executive recruiter who wanted to know, in essence, where the EMR market was going.  Aside from the usual chatter about Meaningful Use, talent shortages and HITECH, one question she asked made me think: “What do you think is the main thing someone like me should know about the health IT market.”

Having pondered this for a while, I realized that the answer is fairly simple. Above all, anyone who wants to understand health IT needs to know two things: a) That health IT leaders need to be change leaders, more than ever before in the industry and, more importantly, b) that the EMR is at version 0.5 when it comes to maturity and integration into the life of most hospitals.

Yes, I mean version 0.5. We’re talking barely in beta, when it comes to solid integration, staff training, enough institutional knowledge so people can share and learn and a high-performing system that doctors love.  Sure, a few hospitals (1 percent, as I recall) have reached that legendary HIMSS Analytics stage 7, but most are lucky to have gotten their Meaningful Use Stage 1 payment into the door.

When you consider that a large number of CIOs doubt they have the man/women power to complete their Stage 1 implementation, the picture looks even grimmer.  Not only are the EMRs immature, they’re largely being implemented and run by consultants who will cut and run with their experience bank, as they have little ability to share it other than in (to staff and doctors at least) boring reports.

Bottom line, I’d argue that it will be a whopping five to seven years, at least, before EMRs meet either HIMSS Analytics criteria for maturity or my personal Zieger seat-of-the-pants model.  I hate to say that it could even be 10 years, but I see it as a possibility.

The reality is, government can be powerful, and big financial incentives are tasty, but you can’t force an industry to change overnight just because it would be really, really cool.

If you don’t check out the HIMSS group on LinkedIn from time to time, you should. I always pick up something to think about when I visit, and this time was no exception.

A group of IT pros, most of whom seemed to have plenty of institutional memory of EMRs gone by, were talking about whether the current leaders of the EMR vendor pack would take over and most of the rest fall away.  The consensus, not surprisingly, was that hospital CEOs are herd animals, and that a few leaders are likely to take most of the market.

As things stand today, even EMRs that seem to be a better fit usually lose to the Epics, Cerners and Meditechs of the world, writes Richard Rauber, FHIMSS.

“Let’s say the preferred EMR has 10 clients similar to their facility, and the second choice has 75 clients in the same bed range with a high level of user satisfaction. Is the risk/reward ratio low enough to go with the smaller vendor? It today’s market it would be unlikely.”

If these posters are right, the hospital market is going to standardize on a dozen or so of the most successful vendors. Unfortunately, that’s likely to lead to some really nasty implementations, suggests Terry Montgomery, PMP: “I had such a project last year. They had to move the go live date three times and there were still bugs they had to fix.”

That being said, I think there will be a lot more dancing when it comes to the physician EMR market.  You’ve got breakout models like the no-cost Practice Fusion — and its bundle of VC cash to fuel the fire — iPad-based DrChrono, Free Mitochon PMS-EHR-HIE and a growing number of elegant, doctor-crafted implementations like SOAPware and Amazing Charts.

While the dynamic of hospital IT purchasing is to standardize on the big boys (the old “nobody gets fired for buying IBM” syndrome), physicians can’t afford to buy a system just because the practice across town thought it was cool. Not that such doesn’t happen, but it’s less likely.

I predict that doctors will have some great options to choose from when they hit HIMSS13 next year, systems integrated intelligently with revenue cycle needs but also cleanly designed and physician friendly.

The smaller EMR companies focused on doctors are just doing a better job of mirroring a doctor’s process, there no doubt in my mind. If only such logic would float upward to the billion-dollar boys behind the hospital giants.

Full Disclosure: Practice Fusion, Mitochon, SOAPware and Amazing Charts are advertisers on this blog.

As some of you know, I’ve toyed with videos on my site for a while now. HIMSS is definitely the place where I’ve done the most video and that will be true again this year. I decided to take a pretty simple approach to video at HIMSS12. Since a large portion of my meetings at HIMSS will be with EHR vendor executives, I thought it would be fun to ask all the EHR vendors the same 5 (I don’t mind doing more or less if they’re good questions) questions.

Since I love the idea of involving the community and kind of crowdsourcing the questions, I’m going to put a few questions out there and listen to feedback from the community on other questions I should ask or modifications to the questions which will get EHR executives to provide some useful information.

1. What differentiates your EHR today?
2. In what ways has the EHR stimulus money and meaningful use had an impact for good or bad on the EHR industry?
3. What are the top reasons why doctors are adopting EHR software?
4. What are the main reasons doctors aren’t adopting EHR software?
5. What will differentiate your EHR 5 years from now?

I’m looking forward to hearing any suggestions you have on how to improve or modify the questions. I suspect I’ll do quite a bit of editing of the questions before I start asking the questions tomorrow. Watch for the videos to be posted on this site, EMR and HIPAA, and EMR and EHR Videos.

Medicine is a risky business, and malpractice suits one of the nastier part of the trade. Whenever something major changes in the way medical care is delivered — including, say, the use of EMRs — it makes sense to expect the worst.

That’s exactly where Dr. Sam Bierstock stands. Bierstock, an interesting guy whose act includes a blues band performing songs on the perils of managed care and EMRs, is going national with his view that EMRs are opening up  bigger med mal liabilities than doctors realize.

“What few people realize is that using an EHR exposes physicians to an Orwellian level of analysis of every single act while doing their job,” writes Bierstock, who nonetheless sees himself as an EHR advocate.  As he rightfully notes, EHRs can be audited to see how long it took a physician to respond to an abnormal lab finding, to find out what doctors said in internal e-mails or even whether they scrolled down an entire screen before closing a document.

To my (admittedly limited) knowledge, there have not yet been any major lawsuits based actions doctors took which can be pinned specifically on the use of an EMR (other than, perhaps, HIPAA breaches). But it does seem credible that such suits are on the horizon. After all, not to be too cynical, but medical malpractice lawyers do work on commission, and if I were them I’d see this as an opportunity.

In his commentary, Bierstock argues that there must be “meaningful tort reform” before physicians can safely use EMRs. The question is what reforms are the right ones.  To date, I haven’t seen model legislation, much less a live bill, which directly addresses this issue.  Do any of you have more information to share, readers?

P.S.  OK, I was wrong about there being no case law on this subject. Here’s at least one example where a physician allegedly altered an EMR audit trail to make it appear that a problem had been flagged.

When a company like Greenway Medical Technologies (NASDAQ: GWAY) goes public, most of the post-IPO talk centers on what its leaders will do with the money.

Ideally, the newly-rich EMR vendor will do customer-friendly stuff like improving their product and strengthening their technical support organization. In reality, though, public companies have a different focus; their job is keeping the Wall Street folks who own their shares happy.

Since happy largely means only one thing — increasing profits and earnings per share — that vendor isn’t likely to take on new expenses. No, it’s more likely to find ways to charge more and sell more, rather than doing a better job of showing love to its existing customers.

SRSsoft’s Evan Steele has shared a nice analysis of  how KLAS customer support ratings (for companies serving the 6 to 25 physician practice) compare with the vendor’s financial status.  While they’re not exactly scientific, Steele’s conclusions are still striking; he concludes that five of the top six vendors are privately owned.

Now, I’m not sure how that correlates with another KLAS data point, in which publicly-held EMR/practice management vendor athenahealth (NASDAQ: ATHN) was named as top-ranked provider for its cloud-based EHR in December. Its stock has also been on a generally upward climb for the past 12 months, ranging from $39.87 to $72.70 per share.

Is it possible athena is managing to please both its customers and its investors? Well, if the typically nasty gossip you see on athena’s discussion board is any indication, no. It looks like grouchy insiders are shorting the stock, which some expect to plunge below its starting price to $30/share or so fairly soon.

That being said, one particularly intriguing comment suggests that Cerner (NASDAQ: CERN) is eyeballing athena, which observers think would be a good fit.

Cerner fits the profile I’ve outlined: it’s huge, profitable and what’s more, in need of a product to fill the physician niche it doesn’t own. If you think Cerner could just build its own physician presence, look at GE’s decision to drop doctor-oriented Centricity Advance. Clearly getting doctors to buy was  much harder than it looked at first glance.

Cerner doesn’t need athena to build its margins: analysts expect it to see sales growth of 13+ percent this year, to $2.5 billion or so. It should also see earnings growth of 22+ percent to $2.25 per share.

Buying athena would give Cerner a critical medical practice presence, and at the same time, let athena keep its customers happy without forcing it to play only for a Wall Street audience. In this situation, at least, maybe an EMR vendor can have its cash and eat it too.

I’ve written more posts than most about doctors and the EMRs they love to hate. But too often, observers like myself are forced to share stats from research organizations or (potentially suspect) ratings by groups like KLAS that poll doctors. Not only are stats a bit sterile, they gloss over some of the idiosyncratic issues doctors face when they take on an EMR.

This time, I had the pleasure of a heart to heart with an ED physician. I got more out of our brief conversation than I have in months of writing up survey “results” from interested parties.

The physician, a left-coaster who works with a large non-profit chain, spent a bit of his time telling me about his experiences with his EHR, which is installed in hospitals where he works.

His conclusion:  his EHR deserves the “Certified Nightmare” nickname it’s won among the medical staff.  From what he says, the EHR installation he’s dealing is way too hard to use.  To him, the user interface imposes a nasty “click burden” that slows him down needlessly.

Before you leap to the conclusion that he’s a Luddite, know that our friendly ED doc is completely paperless at home and that this EHR isn’t his first EHR.  He’s actually pretty fluent with technical stuff.

So I have to believe him when he says that the EMRs he’s looked at are clumsy as heck. “The height of EMR design seems to be Microsoft Outlook 2003,” he says. I wish he was wrong!

In the past, I’ve written volumes about hospital attempts to lock in doctors by offering them access to a free or deeply-discounted EMR. I haven’t heard much about this strategy of late — either the approach was dropped or it’s gone underground — but it seems that other players are still giving it a shot.

This time, in what seems to be a fairly logical step, Quest Diagnostics has kicked off a program offering medical practices a steep 85 percent discount off of the retail price of its Care360 EMR and practice management bundle.  The announcement follows up on its 2011 regional giveaway program, which Quest says attracted thousands of physicians.

The deal, which reduces the physicians’ out of pocket cost to less than $100 per month,  also includes training, hosting, maintenance and 24/7 support for Care360. The lab giant says physicians can get Care360 up and running in about 45 days.

I can’t think of a reason why this wouldn’t make great sense for Quest; if my contacts are to be believed, it has no better reputation than its key competitors when it comes to customer service and follow-through on clinical testing.

On the other hand, if I were a doctor I’d think long and hard before agreeing to a deal like this, even though the software is just about free. There’s simply too much at stake to plunge in.

Yes, Care360 is ONC-ATB certified by CCHIT and, intriguingly, has incorporated the Direct Project specs allowing doctors to share information with patients and hospitals. And yes, it seems to have made efforts to support EMR access via mobile devices. This is all good. And of course, the price is right.

On the other hand, I’m not sure I’d want to make this big of a commitment to any particular service provider, be it a reference lab, a radiology provider or the people who stock my vending machines with sodas.

I’d argue that the more important the service is, the less you want to be beholden to the vendor. After all,what if Care360 isn’t your cup of tea?  Do you really want to disrupt your relationship with a critical provider like Quest?

Not only that, it’s risky to lock in an EMR just because it’s cheap. If Care360 takes 45 days to get installed (activated, configured, trained, etc.), it’s not going to be possible to uninstall it in a day or two, and that could mean misery on wheels if the product doesn’t work for you.

Besides, it’s possible to get Web-based, easy to adopt or drop EMRs for only a couple hundred dollars a month more. It wouldn’t make sense to go for an EMR that might not work just to save that little. (If your margin is tight enough that a savings of $200 or $300 a month is critical, you have worse problems than finding the right EMR!)

I guess I’m saying that even if the EMR is nearly free, caveat emptor. You don’t want to get saddled with an albatross system just because the price was right.

While there’s a number of  large, publicly-traded EMR vendors out there — General Electric (NASDAQ: GE) and Cerner (NASDAQ: CERN) immediately come to mind — to date we haven’t seen many mid-sized or small companies kick off an initial public offering. But one medium-sized EMR/practice management vendor has broken the mold.

Today, Greenway Medical Technologies (NASDAQ: GWAY) took the plunge , pulling in $67 million to fund its operations. While the company had hoped to raise $100 million, its take is nothing to sneeze at. Health IT is a tricky investment, even for pros like yourselves, readers, and institutional investors in particular are a conservative bunch. The fact that they’re spending on a risky business means a lot.

Greenway, whose EMR is bundled with practice management software, had one heck of a ride today, with its stock climbing 30 percent during its first day of trading. The company sold 6.7 million shares at prices below its expected $11 to $13 range, diluting its intake somewhat, but the stock closed at a promising $13 per share.

The Carrollton, Ga.-based vendor has certainly done well in recent times. According to insider Wall Street blog Seeking Alpha, Greenway revenues shot up 55 percent, to $25.7 million, during the last quarter of operations. Operating margins went from negative to a positive 2 percent, which is at least a start.  Its biggest cash generator during the quarter was licensing revenue, which climbed 49 percent.

What’s interesting about this IPO isn’t just the fact that it ended well for Greenway. After all, it did take in less than planned, and the Wall Street crowd justifiably wonders how it will fare in a mind-boggling competitive market.  But it’s worth asking whether Greenway did better because it bundles both an EMR and practice management tools. Did the fact that Greenway wasn’t relying solely on EMR revenue contribute to its growth and financial success?  It would be interesting to find out, as that might help predict whether the bundled model is especially popular with physicians.

As for those who’d seek to imitate Greenway, they may have a chance if they move soon. Seeking Alpha editors think HITECH will still pump enough money into the EMR market to make these companies a reasonable investment. And given how many doctors and hospitals are still struggling to put EMRs in place, I have to agree.  In fact, given that an amazing number of hospitals and medical practices junk their first EMR, there may be a whole second wave of opportunity within three to five years.

All told, if the market’s response to a smallish IPO is any indication, you can expect a bunch of other EMR players to follow in its footsteps.  I’m thinking it will be companies in the $100m to $200m range, as they’re small enough to need capital (much cheaper capital than banks offer these days!) and nimble enough to benefit from the cash influx. Stay tuned and in coming months, I’ll tell you which other EMR and HIT companies I’m betting will climb onto the launch pad.

Here’s an EMR adoption study which interested me largely because it runs counter to what I would have predicted.  The study, which surveyed physicians pre- and post- EMR implementation, found that doctors who owned a stake in their practice found their rollout to be tougher than physicians who didn’t have a stake.

I don’t know about you, but I would have assumed that the folks with more control — the owners — would have found it easier than those who have to adapt to the decisions others make.  But it seems that physician-owners simply feel the pain of change more acutely.

To conduct the study, which was published last week in the Journal of the American Medical Informatics Association,  researchers surveyed 156 physicians working with the Massachusetts eHealth Collaborative.  The surveys included a pre-implementation questionnaire  in 2005 and a post-implementation questionnaire in 2009.

Thirty-five percent of doctors who responded reported that implementation was very difficult, 54 percent said it was somewhat difficult and 12 percent not difficult. Those numbers square pretty well with what I’ve seen elsewhere. The twist here was that 38 percent of physicians with full or partial ownership stakes in their practices voted “very difficult,” versus 27 percent of non-owners. That surprised me. After all, aren’t most of the complaints coming from doctors who try to use the new systems?

According to Marshall Fleurant, MD, one of the study’s authors, the owners “probably experienced more underlying challenges associated with EHR implementation and workflow transformation” given their broader operational responsibilities.

While this study is interesting, it’s hardly the last word. Teasing out just which factors predict how doctors will react to EMR implementation, much less what it takes to support them, is still a new science.  But it never hurts to bear in mind that physicians making critical management decisions get support, too.

For quite some time now, I’ve nursed my own doubts about:
- how effective EMRs are (disastrous in the short term, long term they’re supposed to make life easier, but we haven’t seen any evidence of that yet)
- why physicians are being paid to implement something that makes logical sense (you need something to nudge people out of status quo. And probably in the government’s thinking, what better use for taxpayer dollars, right?)

I came upon this blogpost, provocatively titled Why EMR is a four-letter word to most physicians. Adam Sharp, Par8o (“pareto”, not “par 80″) founder references this post from the Healthcare Blog. The discrepancy in the rates between adoption of any EMR is mind-boggling. It was projected to be close to 56.9% in 2010, vs. adoption of a fully functional EMR (projected to be close to 10.1% in 2010). (I’m not using the 2011 rates because the rates for fully functional EMR adoption in 2011 are not listed).

A reason Sharp gives for incentives and threats of decreased payment are “the industry and physicians have known for years that EMRs do not improve productivity and that it is highly questionable that EMRs lead to better patient outcomes”. While I would agree that in the short term, there is decreased productivity, I’m not so sure you can dismiss there is no productivity increase over the long term. This report about a UC Davis study for example, shows that the loss of productivity was just one month for internal medicine, and that productivity increased to pre-EMR implementation levels in the next six months. The not-so-good news is that productivity levels declined for pediatricians and family practices.

I interpret these findings like this: for specialties where there is loss of productivity, sure, the whole exercise needs a rethink. But in cases where your productivity is at par with your pre-EHR levels, I think there is a hidden benefit that detractors are more than willing to gloss over – the availability of patient data. Data is the holy grail – it’s up to us to figure out whether and how we use it.

Sharp also imagines some doomsday scenarios – of EMR vendors with uncanny abilities to do as they please.

“The goal of EMRs is to wrestle control of healthcare away from the doctor-patient relationship into the hands of third parties who can then implement their policies….by simply removing a button or an option in the EMR.”

Maybe I’m turning turncoat here and letting you guys in on the best kept secret of the IT industry, but every vendor I’ve worked for, past and present, figuratively quakes in his IT boots when it comes to contract renewal. Even for COTS products, vendors actually customize things here and there for customers, till you have 25 versions of the same code, all just to keep their customers happy and paying. While I’m pretty sure there are rogue vendors who can give you the best EMR nightmares money can buy, I also do think customers can, and do, help rein in errant ideas. In other words, vendors can’t simply remove buttons and options or randomly start charging you for stuff, not unless you let it happen. And you, the customer, hold the purse strings, ergo YOU, not the vendor, call the shots.

I don’t quite find myself agreeing with the cynical conclusion of the post which is that the point of EMRs is to wrest control away from doctors and patients into the hands of third parties who wish to regulate choice and eligibility. But there’s plenty there that’s food for thought. Go check it out.