This document summarizes the small hospital EHR/HIS vendor market. It notes that Evident recently acquired Healthland, expanding its client base to over 1,000 small hospitals. Athenahealth and eClinicalWorks recently entered the small hospital market after focusing on physician practices. Other players for small hospitals include Meditech, Cerner, and Allscripts which offer cheaper versions of their products for this market. The document predicts continued consolidation in this space as large vendors look to gain more market share.

1. 2016 HIS Vendor Review
Part 4: Small Hospital Vendors
© 2016 by H.I.S. Professionals, LLC, all rights reserved.
By Vince Ciotti & Susan Pouzar
HIS Professionals, LLC
Evident athenahealth eClinicalWorks

2. Small Hospital Vendors
• Our vendor review ends with those targeting:
– Small hospitals of under 100 beds, including
Critical Access Hospitals (CAH) of <25 beds
– Before you dismiss this “tiny” market, realize
there are over 1,300 CAH hospitals in the US,
– Plus another ≈1,000 from 25 to 100 beds, so
this “small” market has a large footprint!
• This episode covers those vendors’:
- Revenue growth/decline & history
- Products & client bases by bed size
- Recent mergers & acquisitions
- New entrants & surprise departures
- Candid assessment of future prospects

3. • Computer Programming & Systems, Inc. – CPSI was re-branded
as Evident last year, evidently proving something to Wall Street…
• Their
revenue
dropped by
≈11% in
2015, which
explains the
biggest news
in the small
hospital
market
covered on
the next
slide:

4. • Founded as Dairyland in 1981 in Minnesota, Healthland grew
rapidly among small hospitals in the Midwest. They were
acquired in 2007 by Francisco Partners, who then sold them to
Evident in 2015 for $250M – probably quite a handsome profit!
- Healthland has about 350 small hospital clients, about
half on their “Classic” system, and half on the newer
“Centriq” system – a large target for Evident sales.
• Between CPSI’s client base of ≈650 hospitals, and Healthland’s
≈350 clients, Evident now has about 1,000 of the nation’s small
hospitals, making them the dominant player in this market niche.
• Evident also boasts an extremely strong sales & marketing team
led by VP Troy Rosser, so they will very likely turn around their
revenue drop in 2015 as the ≈175 hospitals on Healthland’s older
“Classic” system begin to replace their aging HIS & EMR during
the next 2 years that Evident has committed to support it...
acquires !

5. Below is the approximate # of clients on Evident’s “Thrive” (formerly
“The CPSI System”) and Healthland’s Classic & Centriq systems:
Evident Client Base

6. • Compared to the bewildering array of products from giants like
McKesson, Cerner/Siemens, and Meditech, Evident is simple:
Evident’s Products & Prospects
- They sell “Thrive,” period.
- Saving them a ton of money on
marketing staff, brochures, ppt
slides, proposals, contracts, etc.
• According to Evident’s press release in November of 2015, Evident
only intends to support the older Healthland “Classic” system for
2 years, whereas the newer “Centriq” system for 7 years.
• So we’re pretty bullish on them remaining on top of the small
vendor market for quite some time, as Troy’s sharp team has
unfettered access to the C-suite of hundreds of Healthland clients,
just like Cerner is getting so many Siemens clients on Invision,
Medseries4 and Soarian to drink the “Kansas City Kool-aid.”

7. • NextGen is a major player in the physician practice market with
about a half-billion $s in revenue from >40K physician practice
clients. They bought their way into the small-sized hospital
market a few years ago, by acquiring two small HIS vendors:
• NextGen targeted CAHes with their Opus/Sphere combo, sold a
few, and then surprised everyone by selling these systems to
QuadraMed (now a division of N. Harris) earlier this year.
• (We’ve heard rumors NextGen is starting a consulting division
that will target sales to the C-Suites of physician practice vendors
like athenahealth and eClinicalWorks entering the HIS market…)
- Opus– a solid EHR piloted by hospital
chain Universal Health Systems (UHS).
- Sphere – Florian Weiland’s rock-solid
financial systems, both RCM & ERP.
Sells Their HIS!

8. - Medhost – with a large
number of <100 bed clients in
Nashville-area chains like CHS.
- Meditech – whose Release 6 is
a logical alternative for Magic
and Client/Server clients.
- Cerner – whose Community
Works shares a system among
many CAH/small hospitals.
Other players in the small hospital market…
• If you’re a small hospital with under 100 beds, there are a number
of the larger vendors besides Evident that we reviewed in earlier
episodes, that you could consider in a search for a new system:
- Allscripts – who now offers
“Community Pricing” for
Sunrise in small hospitals.
- Paragon – McKesson’s “go
forward” product has many
very satisfied CAH clients.
- Epic – offers their “Epic-
Connect” through
neighboring IDNs & AMCs.
• Why are so many large vendors interested in the small hospital
market? For the same reason that Cadillac, BMW & Mercedes-
Benz offer smaller versions of their luxury cars: market share!

9. • Interesting how two of the leading physician practice vendors
entered the hospital HIS market the same year NextGen left:
– Athenahealth - acquired RazorInsights with ≈30 CAH clients.
Athenahealth is a major player in the physician practice
market with over 60K providers, and claims they have 4 CAH
clients already live on their “integrated” HIS/EHR…
– eClinicalWorks – another major player in the MD market
claims to have 80 hospitals in India & Africa using their access
and billing systems, with 8 US hospitals serving as pilots…
• They will now compete with Epic et al, by playing in both markets
with an integrated system for hospitals & physician practices. The
key question to evaluate them is whether they are truly integrated
(same programming language, DB and OS) or a screen-scraped,
API interface between disparate systems (interfarce?). For sure,
their web sites, proposals & ppt files are seamlessly integrated…
Latest Entrants into Small Market

10. • There are two other small-hospital players worth a quick review,
as they may follow RazorInsights path to large player status:
– Prognosis – officially known as “Prognosis Innovations
Healthcare,” they were formed in Houston in 2006 by the
former CMIO from Baylor. Their “ChartAcess” EHR & clinicals
is backed by a full suite of financial systems: RCM & ERP. Their
apps are not as robust as major HIS vendors, but their price is
as low as the needs of a CAH with a single-digit census…
– CSS / ORMED – Formed by “CSS HealthTech,” a small hospital
player with a wide array of clinical & financial systems, being
acquired by ORMED, a leading provider of ERP systems. Sadly,
last year they stopped selling their EHR, concentrating
instead on ORMED’s excellent price-performance ERP suite…
• Wonder which physician practice vendors might acquire either of
them, and launch another “integrated” solution in the future?
Up And Comers

11. Recap
• So there it is, a review of the leading HIS vendors for 2016,
separated into their three primary target hospital markets:
– Large hospitals >300 beds, AMCs & IDNs, who buy:
• Cerner, Epic, & Allscripts
– Mid-sized community hospitals from 1-300 beds, who buy:
• Meditech, Paragon, NTT Data, Medhost & QuadraMed
– Small hospitals under 100 beds, and CAH sites, who generally buy:
• Evident (CPSI/Healthland) and now athenahealth & eClinicalWorks
• Thanks to HIStalk for taking so much of their valuable blog space
with our annual ramblings. In case you have any questions,
comments, or your attorneys want our contact information:
- vciotti@hispros.com spouzar@hispros.com
505.466.4958 407.321.1110