Will Hospital Ownership of Small Practices Kill Ambulatory EHR Vendors?

Posted on August 30, 2012 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 10 blogs containing over 8000 articles with John having written over 4000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 16 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit and LinkedIn.

There are a lot of interesting trends in the EHR and healthcare industry right now. One trend that everyone is seeing and talking about is the trend of hospitals buying up ambulatory practices. There are a number of reasons that we see this happening. Not the least of which is the move to Accountable Care Organizations. While I still think that this trend is cyclical, there’s some possibility that the small ambulatory practice might be in long term danger.

If the small ambulatory practice is in danger, what does that mean for EHR software vendors?

One of the first projects that hospital acquired practices experience is the move to the hospital owned EHR. In fact, I know of many cases where the move to the hospital EHR was part of the contract. I’m not sure all of the reasoning, but many hospital systems are moving their recently acquired practices onto EHR before they move their existing practices.

I have yet to see a hospital system use anything but a large EHR vendor. In many ways it makes sense. The hospital system is buying practices across dozens of specialties. Many of the smaller EHR vendors focus on a few different specialties and so they just aren’t an option for a big multi specialty environment.

Then, there’s the issues of scale and control. Can a smaller EHR vendor support such a large implementation? Can a smaller EHR vendor provide the hospital system the control they want of their EHR environment? The first one is an interesting challenge since I’ve seen some hospital owned ambulatory environments having scaling issues with some of the largest EHR vendors. The problem as I saw it from the outside was that the hospital system couldn’t get the attention of the right people at the large EHR vendor. This wouldn’t have been an issue at a small EHR vendor.

With that said, I do think that small EHR vendors will have a huge challenge getting into the large hospital owned clinical practices. Will enough small practices remain for ambulatory EHR vendors to survive? I enough will survive, but in the short term there could be some shrinking of that market.