My blog note of yesterday focused on how a large health system had converted to a single EMR vendor, primarily to achieve system-wide integration (see: Integration as the Major Driver for the Epic Conversion at Carilion Clinic). I subsequently discovered a column by Anthony Guerra in Information Week Healthcare describing what he views as a division of hospital CIOs into two different camps -- the single-vendor enterprise camp and the best-of-breed camp (see: Guerra On Healthcare: A Tale Of Two CIOs), He goes on to suggest that the former have more access to cash and therefore able to pony-up the estimated, stiff $100M price for an enterprise-wide EMR solution. Below is an excerpt from his article:
In what's become an epic battle for the heart and soul of sound CIO strategy, I continually hear the emergence of two camps -- the enterprise, one-vendor-for-all folks, and the cobble-it-together best-of-breed/suite folks....On the best-of-breed/suite side, they question whether their colleagues have been good stewards of the institution's money, as often going "enterprise" means spending upwards of $100 million. In addition, going enterprise means walking down the aisle with one vendor who will be much like a spouse for the next 10 years or more, with divorce being an impractical or impossible option should things go south....On the other side, the best-of-breed/suite folks voice more concern about holding it all together, but truly feel they are doing what is fiscally right for their organization, while vowing to make sure robust integration get all the data where it needs to go....One enterprise CIO I recently interviewed said he didn't want the kind of leverage that comes with not being completely tied to one vendor, he didn't envy the ability of more diverse shops to threaten severing the connection if a particular customer request isn't granted. A best-of-breed/suite CIO whom I also interviewed recently directly accused enterprise folks of trading innovation for "safety," and he was talking about the career kind....At what cost, he asked, had those CIOs obtained their peace of mind - both in terms of financial cost and product flexibility. To a large extent, I believe that budget determines decision in this area. The folks that have the cash seem to overwhelmingly go enterprise, while those on a tighter budget buy piecemeal and go best-of-breed/suite.
Increasingly and as noted above, the hospital CIO seeking an enterprise solution is only able to pick from a very small number of vendors and, in fact, most recent contracts for large, complex hospitals have been won by Epic (see: Forbes.com Puts Some Numbers to the Epic Systems Success Story). In such a quasi-monopoly setting, the vendor can command a premium price for the product such as the $100M cited above. However and also as noted above, the so-called "safe" enterprise choice leaves the hospital executives with little leverage over the vendor for the choice of future enhancements or recourse if the system does not perform adequately. And, in the case of Epic, there are certain vulnerabilities associated with a closely-held company (see: Comments About Mergers and Acquisitions by Healthcare Software Companies). Can an enterprise solution be a truly "safe" one when the vendor holds most of the cards?
Although there have been rumors for years that Epic is developing an LIS, the company does not now have such a product. Happily then, the lab professionals working in an Epic environment are left to fend for themselves. They are free to choose a best-of-breed LIS that can be interfaced to the Epic product. A best-of-breed choice for lab and radiology means the opportunity to choose the system with the greatest functionality. Whereas CIOs seek job security by selecting the "safe" but expensive enterprise solution, pathologists and radiologists tend to keep their jobs by purchasing systems that improve their productivity. Therefore and for pathologists and radiologists, career safety hinges on a best-of-breed choice and continuing leverage over LIS/RIS/PACS vendors. This leverage gives credence to the standard promises from vendors of continuing product innovation.
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