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IBM Making a Move on Exchanges?

by John Moore | March 09, 2009

Today, IBM announced that it has signed-on eHealth Initiative (eHI) CEO, Janet Marchibroda as their new chief healthcare officer.  A somewhat odd title as she is not a doctor, but that is ibm-in-second-lifereally not the issue here.

To date, IBM has been somewhat missing from action in all the HIT buzz with most of the limelight being showered upon traditional EMR vendors and of course the big, yet still nascent initiatives of Google Health and Microsoft’s HealthVault.  With the appointment of Marchibroda, is IBM signalling a renewed interest in HIT?

Our guess is yes and IBM will be targeting its efforts in one sector of the market that has no major competitor, the “Exchange” (HIE & RHIO) markets.

Why “Exchanges”?

  1. Leverages IBM’s core technology strengths in middleware.
  2. Plenty of services revenue in the Exchange market for IBM to tap into.
  3. No competition of note as market is dominated by vendors with less than $30M in annual sales.  IBM may make a play for one of these vendors to gain added expertise and credibility that goes beyond their acquisition of Healthlink in 2005, which was a services play.
  4. Initial HITECH Act funding of $300M with certainly more to follow.

What does Marchibroda bring to the table?

  1. Knows the political landscape on the Hill quite well.
  2. Intimately familiar with the Exchange market through leading eHI and knows both where the skeletons are hidden and where the money will flow.

Note that IBM has played a small, exploratory role in Exchanges in the past, particularly with the North Carolina RHIO, (NCHICA) and Taconic RHIO (THINC), but given their size, nothing really of significance – maybe they decided the market just was not mature enough.  With significant HITECH $$$ now flowing in though, IBM may be getting ready to re-enter the market.

Keep an eye on IBM, as more is likely forthcoming in the next few months as they set themselves up to capitalize on the HITECH Act.

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