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2014 HIS Vendor Review
Part 3: Mid-Range Vendors
© 2015 by H.I.S. Professionals, LLC, all rights reserved.
By Vince Ciotti, Principal
HIS Professionals, LLC
Meditech Paragon NTT Data QuadraMed
Mid-Range Vendors
• After the intro summed up the market, these episodes delve into
the details of 3 vendor niches based on size of target market:
– High-end = large hospitals of 300+ beds, AMCs and IDNs
– Mid-Range = community hospitals of 100-300 beds in size
– Low-end = hospitals of under 100 beds, including CAH
• Interesting how the size of the annual revenue of these 3 vendor
niches’ corresponds to the bed size of their target market…
• This episode covers the mid-sized vendors:
- In the middle of the HIS pack in annual
revenue: “only” in the hundreds of
millions rather than billions of $s.
- Product lines and client bases
- Origins, acquisitions, & mergers…
- Candid assessment of future prospects
• It’s amazing to think of how long this HIS vendor has been in
business: 46 years since their humble beginnings in 1969,
although they didn’t really rock in hospitals until the mid ‘70s
starting with an LIS, gradually expanded to a full HIS in the ‘80s.
• Notice the
two drops
in their
otherwise
amazing
revenue
growth to
over a half
billion: in
2000 and
2012:
• Actually most HIS vendors experienced the same dips due to:
– Y2K – after the mad buying rush to replace “legacy” system pre-2000 for
the date change crisis, hospitals then stopped buying for several years.
– MU - the ARRA stimulus program has done the same thing the past few
years, stirring thousands of sales in 2009 to 2012, then far less lately:
Two Meditech Market Dips
Y2K
MU
• Meditech actually has 3 distinct HIS products & client bases:
– Magic – first developed in the 1970s as Meditech’s version of
MUMPS, there were over 700 hospitals using it during it’s
heyday (aka “MIIS”), probably down to under 500 today...
– “Client/Server” - the quotes are from their contract, as it’s
merely a Windows front-end to MAGIC – a vastly-improved
GUI, but hardly a true C/S like McKesson’s Paragon. C/S sold
very well during the 90s, with ≈400 clients, since dropping.
– Release 6 – aka Focus and MAT (Meditech Advanced
Technology), this is the latest & greatest iteration product.
Three Meditech Client Bases
• Still a proprietary data base, but far more
modern than Magic or C/S, it is more of an
“Append” data base than B-trieve like the
older technologies, and easily the most
feature-rich, with ≈ 400 sites & growing.
• If Meditech were publically held, I would recommend the stock:
– They should do well among the mid-sized Siemens clients on
Invision and Medseries4, as Cerner stirs them up with its
promise of support for only 3-5 years.
Meditech Prospects
- Plus they have those 800 clients
currently on Magic & C/S to sell
Release 6 to, with nary an RFP…
• They have one other major development that should help sales:
– Their acquisition of LSS for physician practices was a bit of a
bust due to being a separate, interfaced product & data base.
– They recently completed a truly integrated physician practice
system within Release 6 with Reg, Sched, BL, AR and EHR.
– With 5 pilots live and 15 claimed sales, this could make them
the mid-sized equivalent to Epic’s integrated suite – huge!
• I know this is a bit redundant in that we covered McK in the
previous episode with the giant vendors, but if you’re a mid-
sized hospital looking for an HIS, you have to consider their
“Paragon” of HIS systems with about 300 clients.
- When the decision was made to shut
down Horizon and replace it with Paragon
as their “go-forward” solution, McKesson
put all its eggs in this mid-sized basket.
• Like Meditech with LSS, they also learned a lesson from Epic:
– They are building an integrated practice management & EHR
built on the same Microsoft SQL data base & Windows OS, so
physicians will finally see the same log-ins, screens, patients
& results, in their practice as well as the hospital. They’re not
quite as far along as Meditech, and one only hopes they’ll do
better developing it in Paragon than they did with Horizon…
• Known as Keane for so many decades, it’s hard to remember this
new name in HIS systems is actually selling several tried & tested
products as “Optimum,” which has several components:
- Full suite of clinicals: EHR, CPOE, LIS, RIS, RX, etc.
- Robust revenue cycle (formerly PatCom), with a
long track record going back to PHS in the 80s.
- Solid ERP suite from “partner” ORMED, who has
since bought small competitor CSS/Healthtech…
• Like Siemens & GE, their parent firm is an international giant
with billions (of Yen) in annual revenue, and their healthcare IT
division includes many pieces beyond a pure HIS, including:
- Long Term Care – in which they are an
industry leader with thousands of clients.
- In pure HIS, they have about a hundred
clients on various modules of Optimum.
• It’s been a wild ride since Keane sold to Caritor in 2007, who
then sold to NTT Data in 2010. All 3 parents had much larger
generic IT revenue in multiple industries besides healthcare, so
we’ve been estimating what slice HIS comprised of them below:
• NTT Data
should finally
make some
sakes (that’s
an honest
typo!) of
Optimum to
the mid-sized
Siemens’
clients on
Medseries4
NTT Data Revenue HIStory
Y2K
Caritor
NTT Data
• The last player in the mid-sized hospital market is a familiar name
but one that has gone through a number of owners & products:
- Starting as Compucare in the 70s, they developed
their Affinity HIS in the 90s, which sold very well.
- Bought by QuadraMed, who tried to build an EHR
& CPOE in the early 2000s, but failed leading to:
- Sold to VC firm Francisco Partners who acquired
CPR from Misys/Per Se (née UltiCare from HDS).
• Francisco then sold QM to the N. Harris division of Constellation
Software, a Canadian firm, who left the name & products alone:
- Affinity – a solid RCM and basic HIS, with
just under 100 clients still running.
- QCPR – “QuadraMed’s Computerized
Medical Record,” with about 30 clients
• QuadraMed made their revenue figures public for about 25
years, so here’s a chart of how they grew handsomely during the
90s when Affinity was hot and hospitals were buying like crazy to
prepare for the Y2K “Armaggedon” (that never happened...)
• Revenue
dropped off
the past few
years, due to
the sale of
Quantim to
Nuance in
2012, and the
post MU
blues the past
few years:
QuadraMed Revenue HIS-tory
Y2K
Quantim
Sale
Next Week
• We’ll delve into the details of the remaining 4 HIS vendors,
covering the small market (in terms of beds and revenue):
– Whose client base consists of mostly under 100 bed
community hospitals, including the many CAH (Critical Access
Hospitals) of under 25 beds (over 1,000 in the US!):
• CPSI – the leader in annual revenue & client base
• Medhost – formerly HMS, with a powerful EDIS
• Healthland – who rules the CAH market
• NextGen – physician practice vendor who bought into HIS
• With a subject area so wide and deep, I’m sure I got a few things
wrong or missed some points, so if you’d like an apology, contact:
- vciotti@hispros.com
- 505.466.4958

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3. 2014 mid range vendors

  • 1. 2014 HIS Vendor Review Part 3: Mid-Range Vendors © 2015 by H.I.S. Professionals, LLC, all rights reserved. By Vince Ciotti, Principal HIS Professionals, LLC Meditech Paragon NTT Data QuadraMed
  • 2. Mid-Range Vendors • After the intro summed up the market, these episodes delve into the details of 3 vendor niches based on size of target market: – High-end = large hospitals of 300+ beds, AMCs and IDNs – Mid-Range = community hospitals of 100-300 beds in size – Low-end = hospitals of under 100 beds, including CAH • Interesting how the size of the annual revenue of these 3 vendor niches’ corresponds to the bed size of their target market… • This episode covers the mid-sized vendors: - In the middle of the HIS pack in annual revenue: “only” in the hundreds of millions rather than billions of $s. - Product lines and client bases - Origins, acquisitions, & mergers… - Candid assessment of future prospects
  • 3. • It’s amazing to think of how long this HIS vendor has been in business: 46 years since their humble beginnings in 1969, although they didn’t really rock in hospitals until the mid ‘70s starting with an LIS, gradually expanded to a full HIS in the ‘80s. • Notice the two drops in their otherwise amazing revenue growth to over a half billion: in 2000 and 2012:
  • 4. • Actually most HIS vendors experienced the same dips due to: – Y2K – after the mad buying rush to replace “legacy” system pre-2000 for the date change crisis, hospitals then stopped buying for several years. – MU - the ARRA stimulus program has done the same thing the past few years, stirring thousands of sales in 2009 to 2012, then far less lately: Two Meditech Market Dips Y2K MU
  • 5. • Meditech actually has 3 distinct HIS products & client bases: – Magic – first developed in the 1970s as Meditech’s version of MUMPS, there were over 700 hospitals using it during it’s heyday (aka “MIIS”), probably down to under 500 today... – “Client/Server” - the quotes are from their contract, as it’s merely a Windows front-end to MAGIC – a vastly-improved GUI, but hardly a true C/S like McKesson’s Paragon. C/S sold very well during the 90s, with ≈400 clients, since dropping. – Release 6 – aka Focus and MAT (Meditech Advanced Technology), this is the latest & greatest iteration product. Three Meditech Client Bases • Still a proprietary data base, but far more modern than Magic or C/S, it is more of an “Append” data base than B-trieve like the older technologies, and easily the most feature-rich, with ≈ 400 sites & growing.
  • 6. • If Meditech were publically held, I would recommend the stock: – They should do well among the mid-sized Siemens clients on Invision and Medseries4, as Cerner stirs them up with its promise of support for only 3-5 years. Meditech Prospects - Plus they have those 800 clients currently on Magic & C/S to sell Release 6 to, with nary an RFP… • They have one other major development that should help sales: – Their acquisition of LSS for physician practices was a bit of a bust due to being a separate, interfaced product & data base. – They recently completed a truly integrated physician practice system within Release 6 with Reg, Sched, BL, AR and EHR. – With 5 pilots live and 15 claimed sales, this could make them the mid-sized equivalent to Epic’s integrated suite – huge!
  • 7. • I know this is a bit redundant in that we covered McK in the previous episode with the giant vendors, but if you’re a mid- sized hospital looking for an HIS, you have to consider their “Paragon” of HIS systems with about 300 clients. - When the decision was made to shut down Horizon and replace it with Paragon as their “go-forward” solution, McKesson put all its eggs in this mid-sized basket. • Like Meditech with LSS, they also learned a lesson from Epic: – They are building an integrated practice management & EHR built on the same Microsoft SQL data base & Windows OS, so physicians will finally see the same log-ins, screens, patients & results, in their practice as well as the hospital. They’re not quite as far along as Meditech, and one only hopes they’ll do better developing it in Paragon than they did with Horizon…
  • 8. • Known as Keane for so many decades, it’s hard to remember this new name in HIS systems is actually selling several tried & tested products as “Optimum,” which has several components: - Full suite of clinicals: EHR, CPOE, LIS, RIS, RX, etc. - Robust revenue cycle (formerly PatCom), with a long track record going back to PHS in the 80s. - Solid ERP suite from “partner” ORMED, who has since bought small competitor CSS/Healthtech… • Like Siemens & GE, their parent firm is an international giant with billions (of Yen) in annual revenue, and their healthcare IT division includes many pieces beyond a pure HIS, including: - Long Term Care – in which they are an industry leader with thousands of clients. - In pure HIS, they have about a hundred clients on various modules of Optimum.
  • 9. • It’s been a wild ride since Keane sold to Caritor in 2007, who then sold to NTT Data in 2010. All 3 parents had much larger generic IT revenue in multiple industries besides healthcare, so we’ve been estimating what slice HIS comprised of them below: • NTT Data should finally make some sakes (that’s an honest typo!) of Optimum to the mid-sized Siemens’ clients on Medseries4 NTT Data Revenue HIStory Y2K Caritor NTT Data
  • 10. • The last player in the mid-sized hospital market is a familiar name but one that has gone through a number of owners & products: - Starting as Compucare in the 70s, they developed their Affinity HIS in the 90s, which sold very well. - Bought by QuadraMed, who tried to build an EHR & CPOE in the early 2000s, but failed leading to: - Sold to VC firm Francisco Partners who acquired CPR from Misys/Per Se (née UltiCare from HDS). • Francisco then sold QM to the N. Harris division of Constellation Software, a Canadian firm, who left the name & products alone: - Affinity – a solid RCM and basic HIS, with just under 100 clients still running. - QCPR – “QuadraMed’s Computerized Medical Record,” with about 30 clients
  • 11. • QuadraMed made their revenue figures public for about 25 years, so here’s a chart of how they grew handsomely during the 90s when Affinity was hot and hospitals were buying like crazy to prepare for the Y2K “Armaggedon” (that never happened...) • Revenue dropped off the past few years, due to the sale of Quantim to Nuance in 2012, and the post MU blues the past few years: QuadraMed Revenue HIS-tory Y2K Quantim Sale
  • 12. Next Week • We’ll delve into the details of the remaining 4 HIS vendors, covering the small market (in terms of beds and revenue): – Whose client base consists of mostly under 100 bed community hospitals, including the many CAH (Critical Access Hospitals) of under 25 beds (over 1,000 in the US!): • CPSI – the leader in annual revenue & client base • Medhost – formerly HMS, with a powerful EDIS • Healthland – who rules the CAH market • NextGen – physician practice vendor who bought into HIS • With a subject area so wide and deep, I’m sure I got a few things wrong or missed some points, so if you’d like an apology, contact: - vciotti@hispros.com - 505.466.4958