Trends in EHR
This White Paper discusses some of the major trends in the Electronic Health Records
(EHR) Market. More information, market sizing and forecasts are available in Kalorama
Information’s full-length study on the market, EMR 2016.
1. EHR is a $26.5 Billion-Dollar Market. The market for
electronic health and medical records is maturing rapidly, due to the influence of government
incentives for the American Recovery and Reinvestment Act of 2009. This Act presents an
unprecedented opportunity for providers to take advantage of federal incentives that hopefully
will improve the quality of care, enhance
patient safety, and prepare practices for the
future. Healthcare Information Technology
(HIT) is primarily divided into two
categories – clinical and administrative IT
solutions. HIT is used in the business and
administrative environment of hospitals,
primary care centers, diagnostic centers,
and physician practices. EMR is a clinical
IT solution, which broadly encompasses
five areas – Pharmacy Information Systems (PISs), Radiology Information Systems (RISs),
Laboratory Information Systems (LISs), other information systems for clinical functions,
wireless-enabled systems and surgical management systems. Tools, such as Computerized
Practitioner Order Entry (CPOE) systems and decision support systems, are used across all these
information systems. There are certain tools, such as Picture Archiving and Communication
Systems (PACS), which are used only for data stored in the RIS.
Documentation, point of care, and medication administration are some of the tools used in
the information systems for clinical solutions. Administrative solutions would include patient
administration, billing, electronic booking
systems, finance, supply chain management, and HR/payroll. Revenues are inclusive of all
software, services and consulting.
2. Rise of Epic and Allscripts
Market share has changed in the last four years, with mid-size competitors ousting large IT
firms in the field. Epic Systems continues to forge ahead landing sizeable contracts to
implement their EHR system. Epic has picked up large and notable clients, including the
Providence Network and most recently CVS Caremark Corp. Epic Systems was founded in
1979 and offers integrated financial and clinical information of inpatient, ambulatory, and payer
technology systems. The company is employee owned and it develops all products in-house.
The company has a small client base of 340 and its model is to offer individualized service to
each of its customers.
Market Leaders 2015 Market Leaders 2012
Epic GE Healthcare
Epic’s software products include scheduling and registration tools, billing and managed
care administration applications, inpatient and outpatient clinical systems, electronic medical
records applications, hospital pharmacy applications, emergency, surgery, radiology, laboratory,
and intensive care department applications.
Allscripts Healthcare Solutions is a provider of clinical software and information
solutions that mainly caters to physicians. The company offers its software as a direct license
product or as a SaaS product. The company services approximately 180,000 physicians
nationwide and approximately 2,500 hospitals. Allscripts Healthcare Solutions is headquartered
in Chicago and employs approximately 7,200 people in more than 44 locations across the United
States. Revenues remained essentially flat. Software and hardware revenue decreased primarily
due to a continued shift from upfront software license agreements to hosted subscription-based
programs. Software delivery, support and maintenance revenues totaled $918 million in 2015, a
one percent increase over 2014. Overall revenues increased only slightly primarily due to
increases in SaaS revenue. In the past couple of years, Allscripts went through a lengthy and
damaging proxy fight with a dissident major shareholder gaining more seats on the board, but the
company has new management and has weathered the storm, retaining a significant market share
position in the market. The company was shopped to investment firms, which resulted in
prospective software clients delaying purchasing decisions or going elsewhere.
The company’s mission is to be one the foremost leaders in the EMR arena by providing
innovative software, connectivity and information solutions for a wide variety of solutions in the
medical environment. To enhance its products, the company is standardizing its small office
EMR and practice management systems by converging its MyWay and Professional Suite
applications. It is hoped that this will strengthen Allscripts’ positioning.
The company is rated highly in various pollings including KLAS – Best EMR for over 75
physicians and 11-75 physicians; Best EMR for Acute Care, Surgeon Management and
Radiology. In the Black Book Ratings, Epic rated #1 in Neurology EMR and in large medical
Center Hospitals over 250 beds. For the sixth straight year, the company was the top provider,
receiving the Overall Software Suite award and the Overall Physician Practice Vendor awards.
3. Physician Usage of EMR Increases
The growth rate in physician use of EMR varied from the years 2006 to 2015. The latter
half of the last decade was a high interest period for EMR use among physicians. However, it
does appear that some slowing in the growth rate occurred at a surprising time in 2009, which
was the year the Federal government launched incentives for physician use through the ARRA
stimulus law. At present, EMR usage is advancing – partially due to the threat of penalties from
the government in the form of reduced payments from Medicare and other government payers.
4. Vendor Switches Drive Market Growth
Approximately 30 percent of hospitals with EMRs are dissatisfied with their purchase and
several have looked into replacing their current vendor. Because the cost of changing systems is
so high, many hospitals have resigned themselves to their current EHR system. The main reasons
for dissatisfaction with the system they have include lack of key features, a cumbersome and
complex interface, poor EHR usability, and bad hardware.
There has been a growing dissatisfaction among customers with their present EMR vendors
and many customers – physicians and hospitals alike are considering changing vendors.
According to the Black Book Ratings survey, 1 in 6 medical practices are planning to change
vendors. This has been mainly due to glitches in the system operation, unfulfilled promises, and
unmet expectations in system implementations, support and features. User satisfaction has
decreased and an increasing number of clients are very dissatisfied with their vendors. The most
cited reason for considering a switch was that the software did not meet the practice’s needs.
One of the biggest issues facing customers who are dissatisfied with their current software
vendor and wanting to make a switch is data lock-in. Vendor data lock-in formats data in order
keep the data hostage. It forces their customers to pay exorbitant fees to gain access to their data.
Software accumulates data, which is simply what it does. In addition, that data is highly
valuable. It is the foundation of analytics. One of the risks of putting data into a platform is that
it may not be easy to get it out. Switching software comes with a high price tag for transferring
data, and the ability to get the data in and out of applications is in the hands of the vendors.
Because the switching cost is completely at the mercy of the current software vendor, it is
relatively easy for vendors to quietly raise that cost, especially if they are afraid of eroding
5. Watch “Blue Button” Patient Access Initiatives
It has long been a desire of both patients and healthcare advocates to involve the patient
and families more directly in patient care. With the advent of the Internet, patients have become
more empowered in their own healthcare due to access to healthcare information. The Office of
the National Coordinator for Health IT (ONC) blue button technology is helping to move this
initiative along. The ONC wants to make it easy and intuitive for people to get access to their
health information. The VA has taken the lead on this and adopted the blue button idea, which
allowed veterans to access their medical records and it has been successful. It is hoped that the
concept will spill over into the private sector and encourage software developers to use data to
create patient friendly apps.
Regulatory measures are also driving this change. In Stage 2 of meaningful use eligible
providers must have 5% of their patients view, transmit, and download their record
electronically. In Stage 3, even more requirements are being proposed such as providers may be
required to accept patient generated health information. Therefore, not only would they be
providing access for the patient but they would be asked to accept the patient input as well.
In some areas, this movement has begun to take hold but there is a lot of opposition.
Many doctors are opposed to patients having full access to the medical record stating that
without the knowledge to fully understand tests and reports, it could lead to undue worry and
stress for the patient and more time required by the physician to explain what the data really
means. Many physicians have suggested a limited access patient portal and this seems to be a
viable alternative. Studies such as the one done by the University of Oregon found that patients
who do not participate in their health care were paying 8% to 21% higher costs compared to
patients with a higher level of involvement.
In the next step, iBlueButton is the mobile embodiment of the Blue Button initiative to enable
patients to easily access and share their health records with their physicians, anywhere
and anytime. A set of mobile apps working in tandem –one for consumers and one for healthcare
providers, iBlueButton gives consumers easy, real-time and anywhere access to their Blue
Button and other health records, and the ability to securely transmit these records to the
healthcare provider they visit, directly from their mobile devices.
This movement is prompting many health care IT software companies to incorporate
Blue Button technology into their systems. Several large retailers and pharmacy chains have
joined the Blue Button initiative including Walgreens, Kroger, Safeway, Rite Aid and CVS
In 2013, Blue Button+ was released which is a machine-readable data format designed for
clinical data holders and third party application developers. The objective of Blue Button+ is to
provide secure, electronic exchange of patient health records from any health provider
participating. This was accomplished through a pilot program, which included technology
developers/designers resulting in 17 new Blue Button compatible healthcare apps.
In 2014, implementation of Blue Button through new Stage 2 requirements went into effect
and the program has continued to expand its scope to include personal healthcare information
from retail pharmacy chains. Blue Button technology attempts to create a standard machine-
readable format that can enable Americans to securely transmit their pharmacy records, using
new innovative software applications and services to prevent drug interactions, dosing errors,
and improve medication adherence.
EMR 2016: The Market for
Electronic Medical Records
For Nine Straight Editions, the Definitive Study on the Electronic Medical Records Market
EMR 2016 provides a complete overview the electronic medical records (EMR) industry. Since 2007
Kalorama has provided industry-standard market sizing for EMR and EHR, tracked usage trends among
physicians and hospitals in the U.S. and surveyed international EMR markets. Since the last edition, the
customer base for EMR has enlarged, market share has
changed, opportunities have grown, new entrants have
entered the market and new regulatory activity has
occurred. This year’s report looks at the market and trends
affecting electronic medical record software and related
services, particularly the current trend towards
interoperability initiatives and the effect of the removal of
incentives and potential change in Meaningful Use. What
is the impact on EMR usage? How have vendors reacted?
This 499-page report is a complete global analysis of the
EMR / EHR market. A market summary includes a total
market analysis, including:
• EMR Market Size and Forecast, 2013-2020
• Market Share Position of EMR Providers
• Percentage Physician EMR Usage, 2006-2015
• Breakout of EMR Market by Type: Software, Services, Hardware
• Physician-based EMR Market Size and Forecast
• Hospital-based EMR Market Size and Forecast
• EMR Software Offering and Pricing
• Physician Vendor Surveys
• Detailed Company Profiles
• International Market Information
What’s Changed? Coverage of Issues and Trends Affecting The Market
The industry is at a crossroads as incentive payments boosting early sales have ended and companies must
compete on product, savings and disincentive avoidance. The industry structure is no longer the way it was
when Kalorama first began reporting on EMR in 2007; large players share space with medium-sized entities
and a significantly large web market. Upgrades and vendor switches are now a significant part of the market.
There are several primary issues and trends affecting the electronic medical records (EMR) industry.
Demographics, increasing life expectancy, and technology innovation will continue to fuel growth in the
future. New developments will also positively influence growth.
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