Epic EHR | Hospital EMR and EHR

Hospital EHR Subsidies

In response to Anne’s post on Senator’s questioning the meaningful use EHR incentive money, Gary Colvin emailed me the following comment:

I would argue for the case where the only reason some providers are in the M.U. game is due to their Hospital subsidies. Instead of paying approx $1,200/ month to lease out their Epic E.M.R., they are enjoying its benefits for under $300 per month. What happens when the subsidy goes away for good? I think you would be hard pressed to see a four doc family practice paying $4,800 / month to enjoy that system — so, when the subsidy goes away (maybe it will be extended to 2016?) it will surely have an impact on who stays in the game.

I did question Gary on his algebra of the cost of Epic per doctor and he said that he got numbers from his hospital which is a public hospital where the pricing has to be transparent. It actually makes me wonder what other EHR pricing data could be uncovered from various publicly available sources. I wonder if data geek Fred Trotter has ever worked on this.

Regardless, I think the EHR subsidies is an important topic. I’ve known many doctors that are afraid of the hospital EHR subsidy because of the lock in it creates with the hospital. However, in many areas the lock in is already there so it doesn’t matter.

I wonder if hospitals are worried what it will mean for them once the EHR subsidies are no longer available.

Judy Calls Epic “Most Open System I Know”

After Zina Moukheiber from Forbes was declined an interview with Judy Faulkner, CEO of Epic, last year Judy decided to talk to Zina about Epic in this article “An Interview With The Most Powerful Woman In Health Care.” Zina does a nice job on the interview and raises some of the questions many people have about Epic. It’s worth a read if you like to follow the hospital EHR world.

Many people are likely going to latch on to Zina calling Judy Faulkner the “most powerful woman in health care.” I don’t think that’s really up for discussion. Judy is the most powerful woman in healthcare and so I’m really glad that Judy is starting to join the discussion about Epic and healthcare. She has an important voice in the discussion and we need her participation. Although, I’m sure she’ll hate being called a billionaire in the article. The reality is we don’t know how much Judy’s really worth until we know how much Epic is worth and I’m not sure Epic plans to go public anytime soon.

Semantics aside, the most important part of the interview was the discussion of Epic being a closed system to which Judy frankly replied, “We are the most open system I know because we’re built as a database management system, and database management systems need to allow their users to mold it to what they need.” I think she really believes that Epic is an open system and quite frankly there aren’t that many in healthcare she can look to that are more open. Sure, a number of EHR vendors have worked to be more open, but even they aren’t as open as many other non health IT software systems. Maybe Judy hasn’t looked at the APIs outside of healthcare.

The real disconnect I had when reading Judy’s thoughts on being open is her lack of understanding of how a truly open API works. In a well implemented API, you can allow any and all programmers to be able to build applications on top of your software without those programmers needing to read your code and study your internal software. I’m not saying you don’t want and need to have an application and verification process for those people who want to tap into your API. This can be part of the process, but a well implemented and documented API can be open to everyone interested in building on top of your software. The value Epic would receive from so many companies iterating and extending the core Epic functionality would be amazing.

The other facet of Epic openness discussed in the article was around interoperability. Judy offered these comments on Epic’s ability to share patient records:

As of March 2013, our customers exchanged 760,000 patient records per month; about one-third were with non-Epic systems. Based on the historical trajectory, we expect that we’re closer to exchanging approximately one million records per month. We are currently exchanging data with Allscripts, Cerner, Department of Defense, Veteran Affairs Administration, Social Security Administration, eHealth Exchange (formerly Nationwide Health Information Network), Greenway, MEDITECH, NextGen and others. We expect to be exchanging data soon with eClinicalWorks, General Electric, Surescripts, and others.

This sounds good on face, but lets consider how many records Epic is sharing. Let’s use the round number of 1 million patient records shared per month. The article says that Epic has about half of the US population on Epic, or about 150 million patients. That means that about 0.67% of Epic’s patient records are being shared.

I’m happy to applaud Epic for sharing 1 million records a month with so many different vendors. My only complaint is that they could do so much more. For example, if you can share records between Epic and Cerner now, does that work for all Epic hospitals or do you have to do the new integration with every hospital that says they want to share records with Cerner? If it was a turn key way to integrate with Cerner, I’m quite sure that instead of 1% of Epic’s patient records being shared we’d see tens of millions of patient records flowing where they needed to go.

Many might remember my surprise breakfast with Judy Faulkner at the CHIME Forum. From my personal experience, Judy is not the black widow that I’ve heard many portray her to be. In fact, I found her incredibly thoughtful, caring, and really interested in quality patient care. That’s why I hope Judy will see that she’s sitting on an opportunity to do so much more than she’s doing now. Although, it will take a shift in her understanding of what it means to be an open EHR. Right now it seems her mostly unfounded fears won’t let her see the possibilities.

Is Epic Stifling Health IT Innovation?

In many ways and definitely based on the buzz, Epic is at the top of the hospital EMR market. According to one estimate, about 40 percent of the U.S. population has its medical information stored in an Epic EMR, a stunning number given the level of competition in the hospital EMR space.

The question is, what impact is that having on the EMR marketplace? According to one piece posted this week by Medical Economics, Epic may be stifling health IT innovation due to its nearly-unassailable market lead.

As readers probably know, Epic has established an empire built around antiquated technology (MUMPS), which essentially forces any company that hopes to interoperate to bear its MUMPS core in mind. We’re talking the blunted edge here.

Perhaps more importantly, now that Epic has such a dominant market share, if it chooses to keep a closed system in place, customers will only get what innovations are driven internally by Epic. If hospitals want innovations emerging outside the Epic bubble, they’ll have to consider the staggering costs — in some cases in the hundreds of millions of dollars — of switching outright to another vendor. If that doesn’t stifle innovation I don’t know what does.

This situation hasn’t been lost on healthcare industry leaders, some of whom have begun to balk at Epic’s rise, Medical Economics reports.

As the piece notes, Epic has attracted outspoken critics that question whether Epic’s’ market dominance is bad for the health IT world as a whole. One of those critics is Paul Levy, former CEO of Beth Israel Deaconess Medical Center, who has taken shots at the EMR giant from his “Not Running A Hospital” blog.

Levy, who Medical Economics cites as one of Epic’s toughest opponents, has been known to compare customers’ relationship with Epic to Stockholm Syndrome, a condition occurring when hostages begin to sympathize and identify with their captors.

All that being said, at the moment, there’s little critics can do to change Epic’s business practices or development plans. Perhaps the Federal Trade Commission will step in at some point if it appears to staff there that Epic’s market control is anti-competitive. In the mean time, though, Epic seems to have a lock on the hospital marketplace — and a disproportionate role in shaping the future of EMRs generally.

Impossible to Say “Wrong EHR”

It seems that the CIO’s are defending the choice of EPIC because it is politically impossible to say they made a wrong choice after so many resources, money and time have been expended.

The above statement is incredibly scary for me to consider. In reality, it’s the opposite of the oft quoted statement, “no one gets fired if you choose IBM.” In healthcare I’ve often heard people say a hospital CIO doesn’t get fired if he chooses Epic.

We’ve all heard about Epic’s tactics for selecting which hospitals can use their EHR. They are highly selective and say no to a lot of hospitals that they don’t think are the right fit for Epic (whatever fit that might be). I even heard one rumor on HIStalk that when an Epic install goes downhill, Epic will offer to pull out and refund all of the money or require that the hospital pay them a lot of money to have Epic send in a recovery team to try and get the Epic EHR install back on track.

When a hospital has invested hundreds of millions and even billions of dollars on a specific EHR software, things can get messy really fast. Imagine you’re a hospital CIO (which many of you that read this site are) that had just spent hundreds of millions of dollars on Epic. Would you be able to go back to the CEO or CFO and say that it was the wrong choice. That’s not an easy discussion to have and I expect very few hospital CIO’s have the gumption to have that conversation.

Although, let’s not put all of this on Epic. Certainly some of the same dynamics are exhibited by all hospital EHR purchases regardless of EHR vendor.

Besides the large contracts that are signed with EHR vendors, the other major reason hospital CIO’s can’t say that they made a mistake in their EHR selection is because of the lack of EHR data liquidity. Once you start entering your data into an EHR, getting it out is like climbing Mount Everest. Only a few people know how to do it, most aren’t successful, and its guaranteed to cost you a lot of money. If EHR vendors would free up the EHR data, it still wouldn’t be an easy decision, but it would help.

Top Hospital EMR & EHR Posts

I was recently asked to identify some of the top blog posts from my websites. It was an interesting exercise to dive into the stats and see what was my top 2012 blog posts. I was actually surprised by what I found.

When I pulled up my stats for 2012, I found that the top Hospital EMR and EHR post was about The Pains of Becoming a Certified Epic Consultant. It’s a great post and there is a lot of interest in becoming a Certified Epic Consultant thanks to the stranglehold that Epic puts on becoming one. The surprising part is that this post was done back in the middle of 2011. However, the post is still getting a ton of traffic.

In fact, as I looked through the list of posts with the most traffic, I had to go all the way down to the 8th post on the list to fnd one from 2012. The top 2012 post was about CA Doctors Saying Their Epic Install Created Massive Turmoil. That’s a great post by Anne Zieger as well. I expect it will continue to do really well for a long time to come. Plus, it’s amazing that the top 2012 post was from only 2 months ago. I’d have thought that one of the early 2012 posts would have had more time to make it to the top of the list. I guess not.

As most of you probably know, I’m a stats addict so I love this stuff. It will be interesting to see which posts become the most enduring. It’s something that’s really hard for me to predict, but it’s always great when content you’ve written years ago is still providing value to readers.

Does the Stockholm Syndrome Apply to EMRs?

Paul Levy wrote an interesting post comparing Stockholm Syndrome to EMR software. For those who aren’t familiar with it, here’s a description of Stockholm Syndrome:

Stockholm syndrome, or capture-bonding, is a psychological phenomenon in which hostages express empathy and have positive feelings towards their captors, sometimes to the point of defending them. These feelings are generally considered irrational in light of the danger or risk endured by the victims, who essentially mistake a lack of abuse from their captors for an act of kindness.

Paul Levy makes the case for EMRs being similar to the Stockholm Syndrome based on Epic’s decisions to not integrate with other medical record systems and some of the controlling tactics that Epic uses with its customers. They are interesting and it’s amazing what a hospital CIO will put up with from an EMR company like Epic.

I’d take this idea one step further. I’ve recently heard a number of people ask the question, “Is Epic really that good or is it just the best of the worst?” Doesn’t this sound a lot like the Stockholm Syndrome? Basically defending something that really isn’t all that great, just because it was better that the bad treatment they got from other EMR vendors before.

Paul Levy describes the myth that he thinks is why we are where we are today:

It is a widely accepted myth that medicine requires complex, highly specialized information-technology (IT) systems. This myth continues to justify soaring IT costs, burdensome physician workloads, and stagnation in innovation — while doctors become increasingly bound to documentation and communication products that are functionally decades behind those they use in their “civilian” life.

We believe that EHR vendors propagate the myth that health IT is qualitatively different from industrial and consumer products in order to protect their prices and market share and block new entrants. In reality, diverse functionality needn’t reside within single EHR systems, and there’s a clear path toward better, safer, cheaper, and nimbler tools for managing health care’s complex tasks.

The two killer points for me are the “stagnation in innovation” and the “functionally decades behind” comments. Those who argue against these things usually use a few specific cases of advancement and innovation as opposed to the industry as a whole.

I’d suggest that one of the biggest impediments to innovation is the barriers to entry for a startup company. How many hospitals do you know that would buy software from a startup company? It’s pretty rare. Yet, this is where the very best innovation comes from in other industries.

I still think that there will be opportunities for some startup companies to come along and disrupt the current EHR providers. Epic did it to Meditech in many ways, and I’m sure we’ll see another come along and do the same. However, I think the number of people that can do this is limited to a very small group of people thanks to the way healthcare is organized and done in hospitals. This lack of access leads to a lack of innovation.

My Surprise Breakfast with Epic CEO Judy Faulkner

One of the highlights of my experience at CHIME 2012 was a surprise breakfast that happened on the final day of CHIME. I actually was a touch late to breakfast after skipping out of a mostly empty room talking about HIPAA (imagine that on the last day of a conference). I got my breakfast and sat down at a table of what turned out to be mostly hospital CIOs.

Meals at CHIME turned out to be a great time to meet, connect and learn from the hospital CIOs that attended. A lively conversation was happening when a lady sat down next to me. I looked up and to my surprise the lady sitting next to me was none other than Judy Faulkner, CEO of Epic. I’m sure she had no idea who I was and I later realized that she likely sat next to me because on the other side of her was a hospital CIO she wanted to apologize to for something that had happened months before.

As an EHR blogger, I admit that I was probably a bit star struck sitting next to Judy. This was probably accentuated by the stigma (right or wrong) that Epic doesn’t like the media very much. So, I decided that rather than probe into Judy like a normal media person (I prefer to be a thought leader as much as I am a journalist anyway), I decided to just sit back and mostly listen.

It made for a really interesting experience since one of the first things Judy talked about was apologizing to this hospital CIO. I’m sure the cynics out there would say that she was probably apologizing because she wanted to further Epic’s business with that CIO. However, that wasn’t the impression I got from Judy. Instead, I got the impression that she had a real feeling of guilt that something she had done had caused other people some amount of trouble. In fact, how troubled she was by something most of us wouldn’t think twice about I think says something about Judy. I think some like to characterize her as a tough, driven, hard-nosed, business woman. Maybe she is in the boardroom, but my experience at breakfast was of her as a very thoughtful caring person.

When I told some of my colleagues about my experience with Judy, she told me I’d been seduced. Maybe she’s right. From my experience I saw a very kind, compassionate Judy.

I’ll wait to share all of the things I learned from my time with Judy for another time, but I did also have an interesting conversation with Judy about Twitter and social media. I think the conversation began because I playfully suggested that she should post whatever we were talking about to Twitter. I say playfully, because I was quite sure I’d never seen Judy on Twitter or any other social media and so I was interested to see her response. She responded something like, “I hope I live my whole life and never go on Twitter.”

While I was partially taken back by the sharpness of her response (Although, thinking back I shouldn’t have been surprised), I replied that “Twitter’s not about ‘what I ate today’ and that there was real value to engaging on Twitter.” To Judy’s credit, she then asked why I thought she should be on Twitter.

My response in the moment was pretty terrible. I told her about Twitter’s ability to “connect people.” While this is valuable to many people, the last thing that Judy wants in her position is more random people connecting with her. After giving such a lackluster response, I decided a broader answer I could have given would be, “Social media is about people and people are the most valuable asset in the world. Social media leverages people in amazingly powerful ways.”

That answer is still not perfect without examples and application, but at least the answer applies more broadly in a way that she could benefit from social media. After this experience, I asked myself if I was doing a keynote on healthcare social media, what would I say?

I’ve already come up with 21 ways to benefit from social media. I’ve also started creating a list of very specific examples of social media in healthcare. If you have more examples, I’d love to hear them in the comments. It only seems fitting that I’d use social media to help me put together this resource, right?

I’m still debating the best way to spread what I gather about healthcare social media, but I think it needs to happen. I still run into far too many people that think that social media is just about what you ate for lunch or your drunken pictures with friends. More people need to be informed about the amazing possibilities with healthcare social media. Plus, next time I happen upon breakfast with Judy Faulkner, I’ll have a much better answer for her.

Epic EMR ROI

I think we are familiar with the HUGE institutions that have selected Epic. The most famous of these is the Kaiser implementation of Epic which started at $1.2 Billion and was projected to cost $4 Billion. Yes, that is Billion with a capital B for an EHR implementation. I haven’t done any in depth research on the average cost of an Epic installation, but I can’t remember seeing one lower than a few hundred million at the least.

As I consider these numbers, the following question keeps nagging at me: What’s the ROI for an Epic installation?

Don’t get me wrong. I already know about the many EMR benefits. Although, billions or even hundreds of millions of dollars is a lot of money to make up.

The problem is that covering the EMR space as long as I have, I have yet to see someone do a ROI analysis of an Epic installation. If there’s one out there that I don’t know about, I’d love to take a look. Maybe Epic has some, but it’s part of their tightly controlled process for selling their EHR. Although, if the ROI was so good, it makes you wonder why they wouldn’t want that information in the public domain.

A part of me wonders if hospital CIO’s really care about the ROI of an Epic EHR install. Epic seems to be similar to what enterprises use to say about IBM: “Nobody ever gets fired for buying IBM.” Do many hospital CIOs see it as “Nobody ever gets fired that buys Epic”?

An Epic Tale: How Queen Faulkner Controls Her Realm

Once there was a queen in a castle in Wisconsin. She had brave armies of stout young health IT soldiers at her disposal, and for a time, her armies handled all the engagements her health IT fiefdom encountered in with relative ease.

Far and wide, people heard of her Epic deeds, and all wanted to partake in the tools of her empire. But lo, it grew, Queen Faulkner’s armies no longer sufficed, and her servants trained IT mercenaries to handle the constant demands her kingdom faced.

Over time, so many were her supplicants that the Queen’s good men and women scarce could do the work they set out to do. However, the Queen was loath to train more mercenaries for, she reasoned, “at some point they could control my kingdom, and that must not be!”

So the Queen wrought a strategem — a compromise she thought might satisfy the demands outside her realm. She made herself sure that candidates for certification would need to pass nearly through the head of a needle to win the honor of engaging in Epic battles.

And thus, the Queen gave control to her IT mercenaries, but not enough to let them come together and rebel against her realm.

But in her desire for control, Queen Faulkner had left herself open to other discontents. The hospital monarchs who sought her tools and protection began to demand more soldiers and armament, and engagements began to become free-for-alls.

Yet, as per her design, the certified mercenary companies were, alas, far too small to meet the needs of full-scale engagements. And the Queen’s own troops were neck-deep in IT code and infrastructure, unable to come to the aide of their fellow Epic soldiers.

Woe to the Epic Queen. Her engagements, yea, they will continue, but will hospital monarchs continue to seek her aid? Perhaps they need to consider that even great empires have limits…

Epic & Meditech: Distant Cousins?

Chris O’Neal is Managing Partner at KATALUS Advisors. KATALUS Advisors is a strategic consulting firm focused on the healthcare vertical. We serve healthcare technology vendors, hospitals, and private equity groups in North America, Europe, and the Middle East. Our services span growth strategies in new and existing markets, M&A due diligence, market analysis, and advisory services. www.KATALUSadvisors.com

A recent comment on a blog post suggested that Epic is following a similar trajectory which Meditech pioneered, basically positing that Meditech was the Epic of 15 years ago. This has obviously generated some controversy as knowledgeable folks have taken up both sides of this argument. In reality, there is no clean “yes” or “no” answer. There are key similarities, as well as stark differences in these two vendors.

In terms of similarities, Epic and Meditech both adhere to a common product delivery philosophy in that they build products rooted in a single-database platform. Both companies believe that integration is key to the success of HIT and have continued to develop their products around that philosophy. Both products even share the use of MUMPS as their backend architecture.

Yet, Meditech did something no other vendor was able to do for the longest time: They delivered an integrated enterprise solution at prices which community hospitals could afford. While Meditech racked up win after win in the community hospital space, Epic approached the market from the opposite end of the spectrum by selling their inpatient solutions to the largest hospitals and IDNs. And the price tag reflected the scale of those contracts. Another difference which has been shared by some is the view that Epic is much more controlling in their processes and approach to working with hospitals. Meditech does not have the same “my way or no way” reputation. Additionally, Epic has consistently improved the usability and functionality of their products, while Meditech has released new versions and enhancements at a slower pace.

In the final analysis, it is probably logical to say Epic and Meditech are more dissimilar than they are similar, when both companies are viewed holistically. This is especially true if we consider that Epic is winning the lion’s share of hospital contracts that it goes after, while Meditech, which still maintains the largest hospital customer base in the industry, is working hard to deliver new software to the hospitals it has already won.

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Hospital EHR Subsidies

Judy Calls Epic “Most Open System I Know”

Is Epic Stifling Health IT Innovation?

Impossible to Say “Wrong EHR”

Top Hospital EMR & EHR Posts

Does the Stockholm Syndrome Apply to EMRs?

Epic EMR ROI

An Epic Tale: How Queen Faulkner Controls Her Realm

Epic & Meditech: Distant Cousins?

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