Joseph Conn, who writes for ModernHealthcare.com, picked up on one of my blog notes about the Epic EMR dominance in larger hospitals (see: Not yet an Epic monopoly or conflict). Here is his note:
Bruce Friedman, in a post on Lab Soft News says, "Epic has achieved a near monopoly of the (electronic health-record systems) installed in the largest U.S. hospitals." And writing in the Washington Examiner, Lachlan Markay, an investigative writer with the conservative Heritage Foundation's Center for Media and Public Policy, reveals that Epic Systems Corp. CEO Judith Faulkner not only has made campaign contributions to Democrats but also has served as a member of the federal Health Information Technology Policy Committee, which "holds in its hands the future of health information technology policy." Well, Epic is on a roll. But market share is measurable, so I spoke with Jason Hess, general manager of clinical research with health IT market watcher Klas Enterprises....Hess shared with me data from his company's latest survey of 1,467 U.S. hospitals and 151 Canadian hospitals with 200 or more beds.
Klas' research shows that Epic's sales in the 200-plus bed market have soared from 2005 through 2010. By the end of 2010, Epic was in a virtual tie with Cerner for the No. 2 spot, with about 290 installations. The same research also depicts a glide path on which Epic could overtake market leader Meditech, with about 325 installations, in a year or two—if present trends continue." Does Epic have a monopoly?" Hess said. "Not yet, but you can see where they're going. Epic is just taking the majority of those large-market wins." But even if Epic gets to 325 hospital installations by the end of 2011, 20% of a market segment does not a monopoly make.
As noted, John wanted to determine whether there is any substance to my claim of an Epic near-monopoly. He touched base with Jason Hess of KLAS. It turns out that Epic is tied with Cerner for hospitals with 200 beds or more. Meditech is the current leader for this category but Epic, according toe Hess, is on a "glide path" to over take Meditech. Here's my reaction to Joseph Conn's piece:
- When I refer to "larger" hospitals, I tend to think of those that are roughly 400-500 beds and larger. There is no question that Meditech dominates the mid-hospital market, which is to say those of around 200-300 beds (see: A Closer Look at Meditech's "Sweet Spot" in the Hospital Software Market). In fact, I have speculated that Cerner is attempting to push its EMR down into this middle market because of the stiff competition from Epic at the higher end (see: Is Cerner Modifying Its EMR Business Model?).
- I am personally most interested in the EMR vendor choices in the larger hospitals. These are the facilities that deliver tertiary care, that conduct clinical research, and train the physicians of tomorrow. They also employ the largest number of physicians. I am therefore more interested in the percentage of physicians who are using the Epic system or will be using it in the next couple of years. Here's an excerpt from a note about the Epic deployment at Shands (see: ShandsHealth Goes Live with Epic; Company Penetration of the Hospital Market). Keep in mind that penetration of one-fourth of all U.S. physicians for Epic translates to a much higher percentage of physicians in larger hospitals.
- Epic has 240 health-care organization customers with 220,000 physicians, including about one-fourth of the physicians in the U.S., according to the company....When all system installations are complete, about 110 million patients will be in Epic systems, approximately 38 percent of all patients in the U.S
- With regard to Judith Faulkner serving on the Health Information Technology Policy Committee, I think that this is appropriate given her degree of client control in larger hospitals. Here's a quote from my Shands/Epic note (see: ShandsHealth Goes Live with Epic; Company Penetration of the Hospital Market):
- [T]he evolution of clinical hospital systems (e.g., EMRs, LISs, RISs, etc.) is a critical element in the overarching strategy of our rapidly expanding health systems. Within a few years, any significant discussion of healthcare strategy in the U.S. will require the active participation and support of Judith Faulkner, the founder and CEO of Epic, and her executive team.
- [T]he evolution of clinical hospital systems (e.g., EMRs, LISs, RISs, etc.) is a critical element in the overarching strategy of our rapidly expanding health systems. Within a few years, any significant discussion of healthcare strategy in the U.S. will require the active participation and support of Judith Faulkner, the founder and CEO of Epic, and her executive team.
- As to Judith Faulkner's management and political style, she is not shy about overt political action, at least in her own backyard (see: Epic Flexes Its Political Muscle in Wisconsin with Boycott). She also has a reputation as a micro-manager within her own company (see: More on the Epic Systems Culture: HR Responsible for All Hiring Decisions). She is definitely a force to be reckoned with on the national health IT scene.
- Finally and relating to the total number of hospitals using the Epic EMR, it's important to remember that Epic is executing a strategy whereby larger hospitals can act as hosting sites for regional smaller hospitals (see: Epic Helps Convert Its Large Hospital Customers into Epic Hosting Sites/Consultants). The contract is signed with the larger hospital, so I am not sure how these types of relationships are counted.
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