2. One Down, 12 to Go!
• Thanks to Steve Klick, we finished the Dairyland
saga, and this week continue our story of
today’s vendors with HMS from Nashville, TN.
- $3.2B = McKesson, née HBOC = Walt Huff, Bruce Barrington, & David Owens
- $2.2B = Cerner, still run by Neal Patterson, co-founded with Cliff Illig
- $1.7B (est) = Siemens, née SMS: Jim Macaleer, Harvey Wilson & Clyde Hyde
- $1.4B = Allscripts, née Eclipsys, also founded by Harvey Wilson of SMS.
- $1.2B = Epic. Gee, I have to wonder, just who was it who founded them?
- $900M (est) - GE Healthcare, née IDX/PHAMIS: created by Malcolm Gleser
- $545M = Meditech, still run after all these years by Antonino Papallardo
- $353M = NextGen: new Opus & old Sphere financials by Florian Weiland
- $174M = CPSI (Computer Products & Services Inc), founded by David Dye
- $170M = QuadraMed, née Compucare, founded by Sheldon Dorenfest
- $160M = Keane, parent giant by John Keane, but HIS div. built by Ray Paris
- $110M = HMS (Healthcare Management Systems), Tom Givens & John Doss
- $70M (est) = Healthland, formerly Dairyland, founded by Steve Klick
3. Another HIS-tory Hero!
• Our story starts with the co-founder of HMS way back in 1984:
– John Doss – who time out from his busy golf, er, work
schedule (wait ‘til you here what he’s doing today!) to relate
this tale of how he co-founded HMS along with Tom Givens
back then.• John started his career back in 1972
when he graduated from the U. of
Tennessee with a degree in math.
• Seems they didn’t offer a degree in
“Computer Science” back then, and
John remember how all kinds of
liberal arts majors (including English
Lit. like me!) became programmers.
• John started with Burroughs, and
then joined GE, two of the BUNCH
Group challenging IBM back then.
4. Fascinating Chain of Events
• You may remember Jim Pesce’s story of GE way back in Episode
13A, where Jim told how he joined that leading shared system in
the 60s, and how HCA eventually bought rights to their Medinet
system back in 1975, and continues to run it for their financials.
– (they use a customized Meditech Magic for their clinicals)
• Well, when John got to GE, he immediately began to appreciate
how unique the needs of a hospital chain which needed:
– Shared general financials (ERP for you moderns) to share
purchasing (AP), materials (GPO), chart of accounts (GL), etc.
• In addition, there was a dire need for corporate
reports of key #s such as census, revenue, AR, etc.
- John worked on providing such reports for HCA
out of GE’s mainframe-based shared system,
- And became expert in how corporations share a
single bank account, allocating funds…
5. To Ernst & Whinney (Pre-”Young)
• John next went into consulting for one of the Big
Big 8: Ernst & Whinney (no “Young” until 1989!),
where he helped hospitals select systems,
learning all about the leading shared & mini
vendors who tried to sell primarily to large
hospitals who could pay the most for systems.
• His expertise with hospital chains continued as E
& W had a number of them as clients.
• John’s Nashville location was the home of
many hospital chains: HCA, HAI, CHS, PSI, etc.
- Anyone figure out why? Maybe back then
when telecomm costs were high, locating
in the middle of the US lowered costs!?
- As Orwell predicted however, the mid-80s
soon saw a major change impacting all of
6. Regan’s “Fiscal Responsibility Act”
• John relates how stunned the world was in the
mid 1980s, when Washington made DRGs the
national panacea for growing healthcare costs.
– (Ironic to be writing this the day the Supreme
Court upheld “ObamaCare,” which you either
hate or love based on your TV channel…)
• John realized that not only chains like his client
HCA, but now every hospital needed a modern
patient accounting system that handle DRGs
• John felt DRGs were a potential nail in
the coffin for old HIS systems, confirmed
when he met an old high school friend
named Tom Givens who had designed
his own Grouper, programmed by a
young hot-rod named Tom Stephenson.
7. So The Stage Was Set…
• So John realized a major opportunity at hand for
a new HIS, with this quartet of congruent factors:
1. Hospital Chains – right in Nashville needing
a new system with the corporate reporting
he had become so expert in working at
HCA…
2. DRGs – posing a major challenge for many
aging shared systems like GE’s Medinet…3. Small Hospitals – under 100 beds (the target for most for-profit
hospital chains anyway ) needing affordable, modern systems…
4. People – his high school friend Tom Givens and Tom Stephenson
had the ability & knowledge to write just such a new system...
• As luck would have it, the Toms’ current employer, a Nashville-based
chain named American Medical Center, sold out, Tom received a bit
of cash from the sale, and they now had some funds for their firm!
8. Stay Tuned For More Next Week…
• Next week, we’ll continue the saga, this time from Tom Givens,
and how they created their start-up HIS vendor HMS in Nashville,
TN, with some fascinating Tom shared (no pun intended!):
– How they “partnered” with their hardware vendor, who tried
to lure them away from healthcare to more lucrative
markets…
– How they sold chain after chain, all based in Nashville, who
either bought or were bought in turn, enlarging HMS’ base…• And I’ll tell the tale of some
fascinating counterparts whereby
both of the two leading shared
systems of the day (SMS and
McAuto) also spread their client
bases and state/regional presence
through similar “exclusive” deals
with national hospital chains.
