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Trash Talk vs. Reality

by John Moore | March 02, 2011

Spreading FUD (fear, uncertainty and doubt) is one of the most common sales tactics used against a competitor. I’m never surprised to hear some FUD being thrown around at a major trade show like HIMSS, but this year it seemed to be particularly virulent among the many vendors I spoke to, which did surprise me. In a market that seemingly has nearly unprecedented money flowing into it, why all the trash talk? The only rational I can come up with is that all that money flowing into healthcare IT is also attracting far more competition from ever bigger players with greater resources.

For example, a little over a year ago the HIE market was comprised of very small vendors, the majority with sales in the $15-25M range. Today we have IBM, who acquired Initiate, Ingenix, who acquired Axolotl, Aetna who acquired Medicity, GE who is partnered with ICW, Surescripts, who partnered with Kryptiq, Thomson Reuters who is partnered with Care Evolution, Microsoft with their Amalga platform, Emdeon, who rolled out their HIE solution at HIMSS’11, and Harris Corp. who announced they will acquire Carefx. This is clearly a white hot market and one that will only see more consolidation in the coming year.

Getting back to the point of this post…

One rumor I heard over and over again was that Medicity was seeing a major push-back by clients and prospects as a result of their acquisition by Aetna. Several vendors told me that the Pennsylvania HIE contract (PHIX) that was going to Medicity had been torn up due to Medicity’s new ownership structure. I was also told that several other Medicity contracts were also in jeopardy. (Note: heard nearly an equal amount of similar rumors for Axolotl, who’s parent is United Health Group.) Now this may all have some truth to it, but it is important that anyone listening to these rumors must consider the source and do their own background check.

It appears that Vermont has done just that for today they awarded the State HIE contract to Medicity. Vermont Information Technology Leaders Inc., (VITL) has been operating a pilot HIE in the State for nearly five years, using technology from GE Healthcare (it was a relatively simple document management solution) so it is with some surprise that the¬†incumbent, GE, who has been investing heavily in updating their HIE solution suite did not get the win. ¬†Another company that was likely bidding for this contract is Covisint, who recently won the contract for Vermont’s Blueprint for Health. Since there will be a direct link between VITL and Blueprint, again a bit of surprise that Covisint did not win this contract either.

So what does this tell us?

1) Despite all the rumors and trash talk not everyone is listening.

2) The fear that payer ownership of an HIE vendor will result in a sales slide for the HIE vendor may be misplaced.

3) Decent, proven technology (and likely very aggressive pricing) can overcome a lot of FUD.

Stay up to the minute.

“As biometric data becomes cheaper and easier to collect through smart sensors, devices, and mobile apps, expect to see more innovations in consumer health.”

-Alicia Vergaras