Orion Strengthens Portfolio & MSFT Gains HIE Partner

On Monday, New Zealand based Orion Health announced that it would acquire the mothballed Health Information Services (HIS) assets of Microsoft, Amalga HIS. In the same announcement, Orion and Microsoft also announced a partnership for Microsoft’s healthcare analytics solution Amalga UIS.

Microsoft, during its HIT buying binge days a few years back had picked up the Thai-based HIS company, Global Care Solutions. Global Care Solutions was credited with building the HIS for medical tourism destination Bumrungad hospital in Thailand. While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later rebranded as Amalga HIS, would only be sold overseas and not it the US, most EHR partners chose to put some distance between themselves and Microsoft. Needless to say, this created far more challenges for Microsoft and its still budding healthcare sector initiatives and the company decided to discontinue further investment in Amalga HIS in July 2010, effectively putting it on the market.

Now, over a year later, Microsoft has finally found a buyer for this asset in Orion Health, who, like Microsoft, has stated that it does not intend to sell this solution suite in the US but instead focus on the Australian and Asian markets. Would not be at all surprising if Orion further extended that reach to all Commonwealth countries, which has been the company’s Go-to-Market (GTM) strategy to date. In speaking with Orion yesterday, they reiterated their intentions to not sell this solution suite in the US market.

Seeing as it took Microsoft over a year to unload Amalga HIS, one has to wonder: Was this solution suite poorly architected or was Microsoft asking far more for it than what others were willing to pay? Having been demo’d the solution on a couple of occasions, likely the latter. Which then makes one wonder, so what kind of deal was actually struck? Our guess is that it had a lot to do with the second portion of this press release, that was overlooked by most in the press, the future partnership surrounding Amalga UIS.

Our latest research on the HIE market is pointing to a significant increase in interest in combining the basics of an HIE (getting clinical data flowing) with analytics to deliver better, more informed care and equally important, optimize the operations of a healthcare organization. As the healthcare sector moves from a transaction-based reimbursement model (fee for service) to one based on outcomes (value-based contracts), analytics will play an increasingly critical role. Thus, we are seeing a number of moves in the market, both acquisitions and partnerships, that look to more closely tie what have been two disparate offerings into one cohesive package.

Orion Health does not have a robust analytics solution. Microsoft does not have a robust HIE solution. Bringing the two together could create a powerful offering and potentially put Orion on equal footing with other HIE market leaders that are currently a step ahead of them with regards to analytics, including OptumInsight (former Axolotl + Ingenix), Thomson Reuters and Care Evolution and their HIEBus platform and IBM, who acquired Initiate in 2010. For Microsoft, this also could be a significant win for to date, they have struggled to find a strong Tier One HIE partner – with Orion, they have found such a partner that could juice sales for Amalga UIS.

But this is far from a done deal for as with any partnership, the devil is always in the details. Based on our conversations with both companies, they do appear to be cognizant of the challenges that lay before them. The biggest challenge will be getting Amalga into a form factor that accelerates time to value for those who adopt this solution. To date, the Amalga solution has seen more than its fair share of challenges in the field in this regard. Couple that with the Orion customer base, which is weighted towards public HIEs, and one can foresee some significant GTM challenges for these two companies in the future. Allscripts faced a similar challenge with HIE partner dbMotion. Orion and Microsoft would be wise to look closely at how Allscripts successfully addressed this challenge for their target market.

 

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Posted in ACO, Acquisition, Electronic Health Records, Health Information Exchange Tagged with: , , , , , ,
2 comments on “Orion Strengthens Portfolio & MSFT Gains HIE Partner
  1. Anand Shroff says:

    I guess this also puts into question the Orion/Oracle HTB relationship. Oracle has been recently repositioning its healthcare assets as more analytics focused than HIE focused, but this move on Orion’s part seems to indicate that they do not buy into Oracle’s healthcare strategy which is yet to yield much success.

    • John says:

      To date, we have not been at all impressed with Oracle’s forays in the HIE market. More smoke and mirrors that a truly substantive HIE platform to serve the needs of healthcare organizations. Not too surprised to see them attempt to move in the direction of analytics/BI but even here, Oracle appears to only dabbling in the market, rather than making a commitment to it. Anand, agree with your assessment that Orion likely came to the same conclusion, aligning themselves with MSFT and its Amalga UIS, rather than a generic Oracle BI solution with weak relevance to healthcare.

19 Pings/Trackbacks for "Orion Strengthens Portfolio & MSFT Gains HIE Partner"
  1. [...] Comments « Orion Strengthens Portfolio & MSFT Gains HIE Partner [...]

  2. [...] a big splash when with Microsoft (Amalga UIS) they won the big Chicago HIE contract. Future: With Microsoft cozying up close to Orion, HealthUnity will be looking hard for other partners and/or to be acquired. Will give them 12-18 [...]

  3. [...] with their earlier sale of a component of Amalga. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  4. [...] Amalga has had limited success and they already acknowledged that with their earlier sale of a component of Amalga. As John Moore of Chilmark Research pointed out in his analysis: [...]

  5. [...] with their earlier sale of a component of Amalga. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  6. [...] with their earlier sale of a component of Amalga. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  7. [...] with their earlier sale of a component of Amalga. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  8. [...] with their earlier sale of a component of Amalga. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  9. [...] with their earlier sale of a component of Amalga. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  10. [...] even while making the vendors Microsoft partners with nervous. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  11. [...] even while making the vendors Microsoft partners with nervous. As John Moore of Chilmark Research pointed out in his analysis:While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  12. [...] success, even while upsetting Microsoft’s partners. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to relieve EHR businessman fears in a US that this HIS resolution suite, [...]

  13. [...] limited success, even while upsetting Microsoft’s partners. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  14. [...] limited success, even while upsetting Microsoft’s partners. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  15. [...] limited success, even while upsetting Microsoft’s partners. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  16. [...] limited success, even while upsetting Microsoft’s partners. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  17. [...] limited success, even while upsetting Microsoft’s partners. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  18. [...] limited success, even while upsetting Microsoft’s partners. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

  19. [...] limited success, even while upsetting Microsoft’s partners. As John Moore of Chilmark Research pointed out in his analysis: While Microsoft tried to quell EHR vendor fears in the US that this HIS solution suite, later [...]

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