It can be a challenge to analyze the sales and customer base of the various EMR/HIS software vendors because these data are considered proprietary. However, a recent interview of Howard Messing, President and CEO of Meditech by Mr. HIStalk, was very interesting (see: HIStalk Interviews Howard Messing). Below is an excerpt from that blog note:
Q: [What is your] total count [of hospital clients] ....It used to be around 2,100.
A: 2,100 or 2,200....
Q: What competitors do you face across the table most often?
A: I think McKesson is certainly in the medium-sized hospitals as the competitor, and I think we face them most often. In the small hospitals, probably CPSI. In the large hospitals, it’s mostly Cerner. Occasionally in the largest hospitals, Epic....
Q: Have the demographics of your customer base shifted as far as size, location, or type of hospital?
A: Yes, I think the size is slightly larger than it used to be. If you would have asked me five years ago, I would have said our sweet spot was 200-225 beds. I would say it’s closer to 275-300 beds today.
First of all and to put all of these numbers into context, it's useful to look at the number of hospitals in the U.S. and their distribution by size. Here's some data that I dug up on the web (see: Hospital Size and Geographic Distribution):
A 2008 AHA survey of hospital size shows that 10 percent of AHA registered hospitals were between 6 and 24 beds, 22 percent were between 25 and 49 beds, 21 percent were between 50 and 99 beds, and another 21 percent were between 100 and 199, while only 11 percent were between 200 and 299. Hospitals over 300 beds comprised 6 percent, and hospitals with more than 400 beds were a mere 8 percent of the tally. Of the total 6,280 hospitals in the survey, most fell in the smaller categories – or between 25 and 199 beds.
Knocking out the smallest hospitals (<100 beds; 53%) and the largest (>400 beds; 8%), it appears to me that Meditech's hospital target with, say, 100-400 beds, constitutes about 40% of the market. According to Messing, it cedes the very smallest hospital market to CPSI, competes with McKesson in the "medium-sized" market, with Cerner in the larger hospitals, and with Epic in the largest. I will take "medium-sized" hospital to mean hospitals with 200-400 beds. It's a little hard for me to imagine Meditech competing with Epic over a proposed hospital contract.
All of this makes perfect sense. The company is very profitable and does not bother with marketing (see: Meditech Plays by Meditech Rules), It's a similar profile to Epic in that it's privately held and does not permit its clients to significantly modify its software, a critical element with such a large number of hospital to support (see: Some Additional Insights into the Epic Corporate Culture). Such an approach works well for mid-range hospitals that don't have large IT staffs but require more functionality than the smallest hospitals.