2. Big Win From 20 Years Ago
• We left off last week with an RFI from Brooks Memorial, a 200-
bed hospital in upstate NY, being issued to the 10 leading HIS
vendors back in 1993 to see how Meditechbeat them so often.
• Before we wasted our time & their money flying in demo teams
to frozen Dunkirk NY (located near Anchorage…), we reviewed the
RFI results to determine which of the vendors were:
– Large &stable enough to last the expected 10 year life cycle
– Had a strong NY state presence to meet regulatory needs
– Were affordable, in terms of capital, operating and TCO
– Had clients of our bed size, apps, interfaces & conversion
The results are summarized in the table on the following page.
• If you don’t recognize the acronyms for the vendors on thetop
row, then you didn’t read last week’s episode that described
them! You can find all these past episodes at hispros.com
3. 1993 Vendor RFI Responses
CHC
Compu
care
First
Data GTE HBO HCS IBAX Keane
Medi-
tech SMS SDS
Years in
HIS biz 21 20 25 18 18 25 12 20 25 25 15
Revenue
in 000s $43,400 $23,200 ≈$200,000 ≈$60,000 $280,000 ≈$10,000 ≈$50,000 $90,000 $92,300 $470,000 ≈$14,000
# of
FTEs 260 215 1,031 222 1,814 75 582 244 1,105 4,000 148
Nearest
office Texas Virginia N. Carolina Phila. Pitts. New Jersey Florida New York Mass. New Jersey Iowa
# of US
clients 42 34 128 238 188
(Not
provided) ≈200 15 104 54 85
NY state
Clients 2 3 7 5 2 1 6 9 10 3 1
Hard-
ware HP, G30
DG Aviion
9500
DEC
"Alpha" IBM AS/400
DG Aviion
5240 IBM AS/400 DEC 5000 DG or DEC
DEC
4000/Alpha
Capital
Costs $984,624 $1,124,604 $650,750 $904,991 $1,375,306 $1,162,938 $1,496,000 $909,800 $1,335,000 $950,000 $824,082
Opera-
tingCost $131,516 $104,052 $86,268 $137,652 $126,325 $178,553 $125,880 $79,200 $148,200 $96,000 $77,765
5 year
TCO $1,642,205 $1,644,864 $1,082,090 $1,593,251 $2,006,931 $2,055,701 $2,125,400 $1,305,800 $2,076,000 $1,430,000 $1,212,906
10 Year
TCO $2,299,787 $2,165,124 $1,513,430 $2,281,511 $2,638,556 $2,948,464 $2,754,800 $1,701,800 $2,817,000 $1,910,000 $1,601,730
4. Winnowing the Field
• We presented these RFI resultsto our selection committee, with
the caveats in red ink for those vendors with weak responses: small
annual revenue, minimal NY presence, etc. Meditech’s only issue
was high capital costs, however CFO Ralph Webdale said he would
gladly pay top dollar if they turned out to be the best system!
• So we next scheduled demos at Brooks for the 6 RFI “winners,”
making each vendor follow the same agenda (1-2 hours per user
department) and grading each through a numeric checklist on:
– User-friendly GUI (or not), patient search,
reports, security, flexibility, report writer, etc.
The checklists also helped to guide the committee
into evaluating the system, rather than just liking
the “demo dollie (or dude)” with the nicest
personality, so totally irrelevant after the sale!
5. Brooks’ Demo Results
• And here, 20 years later, are the results, which took a
few thousand keystrokes to update from MS Works 1.0 to Excel 2012!
• As you can see, the
highest score went to
Meditech, but HBO and
CHC did pretty well too.
• An no one really stunk,
showing the committee
that all modern systems
beat their old SAINT…
• Next we made phone calls to the top 3 vendors, but a lot different
approach than the near-perfect “98.5” scores KLAS comes up with:
- Ours were peer-to-peer: RN to RN, biller-to-biller, IT to IT, etc.
- And not to “flagship” sites, but our bed size, state, version, etc.
- And scored with another thorough checklist, with these results:
6. Telephone Reference Calls
• Meditech led again, but only a tad ahead of HBO. It was
poor CHC who’s few users in NY state were only so-so…
• We’ve done
over HIS 150
searches by
now, and our
phone scores
are about 70%,
helping lower
end users’
expectations.
• The next step in our process hardly anyone ever does: look at the
user manuals before you buy! Paper binders were a pain to ship in
‘93, but today’s CDs and web sites are easily available. And you get
much lower scores than on any RFP “feature checklist” response!
7. User Manual Review
• You sure don’t get many “98.5” scoreshere either! Indeed,
some up-and-coming vendors don’t even have user doc…
• They claim their systems
are so user-friendly, no
manuals are needed!?
• (tell that to an RN on the
3rd shift trying to help a
physician figure out how
to DC a med via CPOE…)
• As you can see above, Meditech had superb user manuals back then,
HBO’s were pretty good, but CHC had a long way to go in this regard.
• So we pretty much had our two “finalist” vendors for the next steps:
- Site visits, once again peer-to-peer, with no sales “chaperones!”
- Detailed cost review, with over 10 pages per (poor) vendor
- And concurrent contract negotiations (no “VOC” beforehand)
8. Contract Questionnaire
• As you figured out by now, we don’t place much stock in an RFP
“Feature Checklist,” defined as a “Request For Prevarication.”
• One checklist we do make vendors fill out is for contract Ts & Cs.
Back in 1993, we had 25 items we drilled vendors on, such as:
– Sub-1-second system response times, or the vendor buys more hardware
– Veteran installers: 5 years in Healthcare, 2 with the vendor, 1 prior install
• By today, we have over 70 such nasty items on ARRA, ICD-10, etc.
• This is the one area where Meditech
did poorly, as illustrated on the right:
• The boys in Boston are just tough
negotiators, and we struggle to get
them togrant any concessions...
• At our next committee meeting, we
summed up all these scores & voted
9. Brook’s Committee Vote
• Here is how Brook’s 10 user departments ranked the 3 vendors;
we inverted their ranking for scores so the highestscore wins: 3
points to their first choice, 2 to runner up, and 1 for 3rd choice.
CHCFDCHBOCMeditech
Pharmacy 2 1 3
Data Processing 1 2 3
Human Resources 2 1 3
Radiology 3 1 2
Medical Records 2 3
Nursing 1.5 1.5 3
General Accounting 1.5 1.5 3
Laboratory 0.5 2 3
Nursing 1 2 3
Patient Accounting 2 1 3
Totals: 12.5 4 13 29
• No contest! Meditech just swept the vote except for Radiology
(maybe they had a deeper view?). It was so overwhelming, Ralph
called off the remaining steps in the process (site visits, etc.).
10. Meditech Recap
• So there you have it: how a handful of MIT grads formed a start-
up HIS vendor that swept the small to mid-range hospital market!
– Strengths: Satisfied clients (functionality & support), “Total
HIS” (financial & clinical systems), low operating costs (12% of
license fee/yr), and a stable management team/direction (no
acquisitions, C-Suite change, nor 90-day Wall Street panic).
– Weaknesses: High capital costs (you get
what you pay for?), proprietary data base
(tough interfaces – this ad is a lie!), and
rookie installers. Today, one might also
quibble about multiple product lines…
• Next week? We shift to the 6th ranking vendor of
today: GE Healthcare, and their roots in another
frozen northland – Burlington, Vermont. Any HIS
veterans who worked for “Burlington Data
Processing” please write: vciotti@hispros.com
