- Two quarters are in the books and the EHR market already looks significantly different than it did only six months ago.
Allscripts, Cerner, Epic, eClinicalWorks, athenahealth, and a few new players have changed the face of the health IT landscape through disruptive investments, partnerships, and innovations.
With many clinicians expressing frustration with EHR technology in recent years, health IT companies are under pressure to improve EHR usability through innovative new technologies. Compounding the pressure to innovate is an increasingly crowded marketplace that demands vendors continue to update existing offerings to support EHR optimization and ever-changing federal regulations.
And with tech giants such as Google and Apple dipping into the healthcare sphere, even the most dominant players in the EHR marketplace need to stay ahead of new trends and consumer demands to firmly secure their places at the top of the heap.
Below are the top 5 biggest acquisitions, contract wins, and new innovations that have changed the health IT marketplace halfway into the year:
The Allscripts acquisitions
So far in 2018, Allscripts has snapped up several smaller EHR companies as it bulks up its inpatient and ambulatory clinical portfolio.
In January, Allscripts acquired Practice Fusion in a $100 million cash deal. Practice Fusion’s formerly free EHR system complements Allscripts existing ambulatory clinical portfolio as a value offering to accommodate under-served clinicians in small and individual physician practices.
The acquisition signaled the end of the business model that made Practice Fusion so popular among small physician practices, with a user base that had grown to include about 100,000 healthcare providers.
Starting this summer, Practice Fusion users will be required to pay a monthly subscription fee of $100 per physician per month. While still affordable, the acquisition increased expenses for small physician practices that formerly had access to a free EHR system in a market notorious for sky-high price tags.
Allscripts acquisition of Practice Fusion followed its purchase of McKesson’s hospital and health system health IT business.
The sale of McKesson indicated there may be few opportunities for technology developers to thrive in a crowded market dominated by a few large enterprise health IT companies.
In addition to Practice Fusion, Allscripts also acquired mobile enterprise engagement solutions company HealthGrid Holding Company in 2018 to expand its FollowMyHealth patient engagement solution offerings.
"Adding these significant capabilities to our portfolio, further growing our FollowMyHealth platform, will benefit our clients and their patients, as our robust offering will create opportunities to reach new heights of patient outreach and engagement," said Allscripts Solutions Development Executive Vice President Jim Hewitt.
"Additionally, it advances our EHR-agnostic approach,” added Hewitt. “You don’t have to have an Allscripts EHR to make this work.”
Allscripts closed the deal in the second quarter.
The rapid succession of acquisitions by Allscripts indicates consolidation in the EHR market isn’t going away. While some smaller EHR companies have found success in niche markets, larger enterprise vendors are working to box them out and maintain a lion’s share of the market.
athenahealth faces off with activist investors
For physician practices and hospitals on a budget, athenahealth’s web-based EHR system offering and unique payment structure can be an attractive option. The EHR company has received largely positive reviews from both users and market researchers.
However, one activist investor — hedge fund Elliott Management — publicly expressed its disapproval of athenahealth’s inability to execute on strategic business initiatives, as well as its status as a public company.
“Unfortunately, we are faced now with the stark reality that athenahealth as a public-company investment, despite all of its promise, has not worked for many years, is not working today and will not work in the future,” wrote Elliott Management Partner and Senior Portfolio Manager Jesse Cohn in a May 7 open letter to the athenahealth board of directors.
Elliott Management stated athenahealth’s potential “will never be realized” without significant operational change, and suggested the private market could be an ideal setting for the health IT company. As a private company, athenahealth would no longer need to report quarterly earnings and progress.
The hedge fund offered to buy athenahealth for $160 a share, or about $7 billion.
In response, athenahealth confirmed it will consult with its financial and legal advisors to make a decision about the best course of action for the company.
Other top shareholders with stake in athenahealth — including investor Janus Henderson Group — similarly expressed concern with athenahealth management’s execution of strategic initiatives in the weeks following Elliott Management’s proposal.
Elliott Management continued to turn up the heat on athenahealth, leveraging shareholder support for its acquisition offer and further pressuring the health IT company to take the $7 billion buyout offer.
Mounting pressures on athenahealth management culminated in CEO Jonathan Bush’s resignation on June 6.
Following the CEO’s departure, remaining athenahealth executives announced the health IT company will potentially pursue a sale or merger.
While Elliott Management’s decision to target athenahealth caused significant disruption at the health IT company, its shares jumped significantly — 18 percent, according to Bloomberg.
The buyout proposition could signal big changes to come for athenahealth if executives follow through on a take-private transaction.
athenahealth management is still considering the buyout offer.
Cerner secures dominant position in the public sector
After announcing plans to adopt a Cerner EHR system similar to the Department of Defense’s (DoD’s) MHS GENESIS system in June 2017, VA finally signed the dotted line on a $10 billion Cerner EHR implementation contract nearly a year later.
In May, Acting VA Secretary Robert Wilkie signed the contract and marked the beginning of the EHR implementation process, which will span about 10 years and include 48 deployment waves.
“I am pleased to announce we have signed a contract with Cerner today that will modernize the VA’s health care IT system and help provide seamless care to Veterans as they transition from military service to Veteran status, and when they choose to use community care,” said Wilkie in a public statement.
In addition to its dealings with VA, Cerner also secured an opportunity to provide the Coast Guard with an EHR system.
In April, the Coast Guard announced it will hop on DoD’s existing $4.3 billion contract with Leidos and Cerner.
The decision follows the Coast Guard’s failed $14 million Epic EHR implementation contract, which it terminated in 2016.
The Coast Guard, DoD, and VA will benefit from streamlined health data exchange and improved interoperability by implementing similar Cerner platforms.
Meanwhile — if all three EHR implementation projects run smoothly — Cerner will secure its place as the dominant player among health IT companies in the public sector.
Epic, athenahealth, eClinicalWorks launch virtual assistants
At the start of the year, eClinicalWorks, Epic, and athenahealth began releasing EHR-integrated virtual assistants akin to Amazon’s Alexa.
The virtual assistants are designed to reduce provider burden and boost physician satisfaction with EHR technology.
eClinicalWorks launched its virtual assistant — Eva — in December 2017. eClinicalWorks users this year can utilize Eva in the health IT company’s V11 EHR product offering.
Meanwhile, Epic partnered with clinical documentation solutions provider Nuance to launch its own virtual assistant in March 2018.
The virtual assistant is powered by artificial intelligence (AI) and is designed to improve physician productivity and clinical efficiency by streamlining EHR clinical documentation.
Epic users can use Nuance’s virtual assistant for voice-activated clinical documentation within the Epic Haiku, Epic Rover, and Epic Cadence.
"These advancements represent a growing need for next-level conversational AI capabilities and we expect them to be a catalyst for changing how and what physicians are required to document in progress notes,” said Epic President Carl Dvorak.
athenahealth partnered with virtual assistant solutions provider Noteswift through its More Disruption Please program to launch Samantha.
Samantha is available to athenahealth’s network of more than 106,000 providers to increase reporting accuracy and reduce EHR clinical documentation.
The advent of the voice-activated, EHR-integrated virtual assistant could drive improvements in EHR usability and physician satisfaction with EHR technology. Enabling providers to spend less time on data entry by dictating physician notes to virtual assistants could also free up providers to spend more time with patients.
While the technology is still relatively new, the integration of AI-powered voice recognition capabilities into EHR systems may prove useful in easing provider burden in new ways.
Google, Apple, Amazon take steps to enter health IT space
Finally, tech giants including Amazon, Apple, and Google made initial moves in the first half of 2018 to flood the health IT market with innovations in interoperability, health data exchange, EHR patient data access, wearable devices, healthcare apps, and other areas primed for development.
In January, Apple launched its Health Records EHR data viewer. Early participants including Cedars Sinai, Cerner Healthe Clinic, Dignity Health, and other large health systems began allowing patients to access and view their complete EHRs on iOS devices.
According to health system executives, the EHR data viewer will likely have an immediate and significant positive impact on patient engagement, health IT innovation, and interoperability.
In June, Apple announced a new Health Records application programming interface (API) that will allow health IT innovators and researchers to create apps that leverage health records data to improve medication management, nutrition plan development, disease diagnosis, and other clinical processes.
Google is also working to accelerate innovation.
In partnership with AMA, Google launched the AMA Health Care Interoperability and Innovation Challenge to spur medical device development.
HealthSteps won the challenge with a mobile health platform that enables patients to share their care plans with family members and providers.
Google is also helping to drive innovation through its open-source Google Cloud Healthcare API, which is designed to overcome interoperability challenges by providing an infrastructure solution based on Fast Healthcare Interoperability Resources (FHIR) users can access for analytics and machine learning.
Users including a team at the Stanford School of Medicine are leveraging the Google Cloud Healthcare API to make advancements in biomedical research.
While Amazon’s entrance into the health IT market has been largely shrouded in rumor and secrecy, one definitive first step into the EHR industry came when Amazon Web Services (AWS) partnered with Medsphere.
In March, Medsphere moved its CareVue EHR system offering to AWS to ease the financial strain of EHR implementation for community hospitals by eliminating the need for local data centers. CareVue Cloud is a platform-as-a-service (PaaS) option that will allow users cost savings and professional data security.
While AWS was rumored to be in talks to finalize a partnership with Cerner that would center on Cerner’s population health management platform, a formal partnership has not been announced.
Google, Amazon, and Apple are still in the early stages of delving into the health IT market, but the tech giants may be laying the groundwork for big innovations to come.