The Secret to Epic's Success in the Hospital EMR Market

Mr. HIStalk, in response to a reader's comment, opines about why Epic has been so successful in the hospital EMR market. Although short, his analysis provides a penetrating analysis of why a particular vendor has experienced such success and may continue to do so.

It’s easy to see with 20-20-hindsight why Epic owns the markets they choose to play in: (a) they built new products that reflected that inpatient-outpatient continuum while their competitors kept bolting on marginally useful features and acquisitions onto old platforms that were clearly unsuited for them; (b) they created MyChart before anyone cared about sharing data and PHRs; (c) they didn’t get bogged down in a Viet Nam of unsuitable customers by selling indiscriminately to just anyone; and (d) they ran their implementations firmly and protected customers from their own success-sapping indecision. Nobody else is even close, handing over the entire upper-end market to Epic without much resistance. Cerner had a shot but doesn’t seem to be selling much new business, while the reps from GE, Siemens, and McKesson might as well carry a white flag when they visit hospitals of more than 400 beds. Eclipsys is strong in the traditional inpatient core of CPOE, pharmacy, and nursing, but won’t get a foothold with customers who want a broad application line that covers outpatient in a single database. Epic owes its success to weak competition as much as anything else. In a perfect world, someone would step up to offer an Cadillac alternative, but for now, Epic is running its own Cash for Clunkers program (they get the cash).

What's fascinating about this analysis is how much more prescient Epic has been about the EMR market than its competitors and hospital executives. I will guarantee you that few hospital CEOs/CIOs were talking about PHRs and sharing clinical data with patients a few years ago. Most of them still don't like the idea -- they consider clinical data to be proprietary to them. Any yet Epic began to develop their PHR product, MyChart, in such an environment because it was the right thing to do. The major payoff for this investment is yet to come. Ten years ago, inpatient care was the dominant focus of care for hospital executives and their primary automation focus. Few talked about the inpatient-outpatient continuum. An yet, even then, the migration of surgical and oncology patients to the outpatient setting was very predictable.

The last two items on Mr. HIStalk's list, picking the right hospital customers and protecting them from their own inadequacies, are essential ingredients in Epic's success formula. You see, it's not enough for an EMR vendor to understand precisely where the hospital market is heading. It's essential that its customers buy into this vision (or at least think that they do). The rest are rejected. The vendor then needs to protect all of its "acceptable customers" from self-inflicted wounds. These wounds include indecision and an irresistible urge to customize an EMR to an unmanageable degree based on pressure from politically powerful groups within the hospital. The product that then gets installed is a workable and standardized, if lackluster, EMR. Cash for clunkers.