As required by legislation in the American Reinvestment and Recovery Act (ARRA), HHS/CMS released rules for the meaningful use of certified EHRs before the end of 2009 (late the afternoon of Dec. 30th). Others have already written plenty on what is actually stated in these rules, therefore, let’s take a look at the potential winners and losers of these new rules as well as those where it is still too early to tell. This analysis will be laid out over the next few posts starting with Winners below.
Winners
Consultants: At 556 pages, very few physicians and hospitals will take the time to read the complete meaningful use rules, rather hiring consultants to guide them in mapping out a strategy to adopt and implement a certified EHR to meet these requirements in the tight time-frame allowed. Hospitals and large private practices will have the resources to hire such consultants, small practices will not, instead relying on the yet to be formed statewide extension centers.
Payers: Demonstrating meaningful use will require electronic eligibility checking and claims submission for 80% of all patient visits. This will greatly simplify payers cost burden for payers who must currently contend with eligibility checking by phone and mountains of paper claims submissions from providers.
Large, Established EHR/EMR Vendors: These vendors have the resources and political clout to insure their apps will meet certification requirements. They will meet such requirements either through internal development or acquisitions. In some cases, partnerships will also be used to meet smaller, niche requirements of meaningful use. Big boys with an established presence include: AllScripts, Cerner, Eclipsys, Epic, GE, McKesson, NextGen, Siemens, etc.
Revenue Cycle Management (RCM) Vendors: Core to most RCM vendors solutions is the ability to perform electronic eligibility checking and e-claims submission. As this is now a core requirement for incentive payment, these vendors will see a boom in business. Smaller, independent vendors such as MedAssets and SSI will likely be acquired. Large vendors, such as Emdeon, may expand their offerings into core EMR functionality similar to what athenahealth has done with the introduction of athenaclinicals. Companies such as RelayHealth should also see a bump up in business as providers look to address this requirement.
Medication Checking Reconciliation & eRx Apps: A significant amount of attention is being paid to addressing medication errors and e-Prescribing (eRx) in Stage 1 of the meaningful use rules. The HITECH Act legislation specifically calls out eRx as part of meaningful use and CMS has been promoting/encouraging adoption as well so this is a no-brainer. The big winner here is SureScripts. Medication/formulary reconciliation is also called for in Stage 1, something that the Joint Commission has been advocating since 2005. Several eRx and EMR apps have embedded this functionality in their solutions. Lastly, physicians and hospitals will be required to do drug-drug, drug-allergy and drug-formulary checking. Companies such as First Data and Thompson as well as Cerner’s Multum solution should do well in addressing this requirement. There are also a plethora of smaller companies, such as enhancedMD, Epocrates, Medscape, etc. that may benefit, through partnerships with or acquisitions by larger HIT firms.
M&A Firms and Small, Innovative Software Companies:: Stage 1 is asking for a lot of functionality that simply does not exist in many EHR/EMR solutions. Larger, more established EHR/EMR companies will not have enough time to build out all the functionality required and will either seek partnerships or acquire smaller, niche vendors such as those mentioned previously (our bet is we’ll see more acquisitions than partnerships). Due to the strong demand for niche applications to fill gaps in their solution portfolios to meet Stage 1 requirements, these EHR/EMR vendors will likely pay premium dollars for the best-in-class apps. Small, innovative software vendors and the M&A firms that represent them will do well over the next few years.
John,
What about the winners among providers? Do you think the move will accelerate the trends toward greater physician employment by hospitals and IDNs? How about consolidation of smaller hospitals into bigger systems?
Both of these trends seem to be independent of HITECH, but may be accelerated by the value of the incentives to hospitals.
Jack
Jack, believe that among the majority of providers this will be seen more as a burden not as a gift/incentive. There will be those practices, such as Greenway in Portland OR who are already completely paperless that will benefit, but this is a very small minority.
More broadly, consolidation of providers into ever larger IDNs will continue regardless of the HITECH Act – much larger market forcing functions at play here than the incentives for HIT adoption.
Nice list. Hits a number of the Big Winners I wrote about back in February: http://www.emrandhipaa.com/emr-and-hipaa/2009/02/19/big-winners-from-obama-ehr-stimulus-hitech/ However, you add some other niche companies that I agree are going to be big winners.
As a side note, I’m working on a conference this coming year that I’d love for you to participate in: http://www.emrandhipaa.com/emr-and-hipaa/2009/12/12/emr-stimulus-selection-and-implementation-conference/ I also hope you’re planning on being at HIMSS and we can have a chance to meet in person.
Long term winners will be patients. Meaningful use of EMR’s will (should at least) result in better patient management.
Sucks that RHIO’s and HIE’s are placed on the backburners, although there is some mention of them in 2012 as a possible automated Data reporting method (page 168), but with a July 1, 2011 dealine for standards, it leaves alot of RHIO’s standing around.
It is nice that they recognize RHIO’s as “promoting EHR’s”, and as such can receive funds from EP’s through medicaid (page 292).
In one way, it’s nice that they scaled back, but without a ‘need’ for a RHIO at this juncture, I wonder what will become of the current RHIO’s that were hoping that “Meaningful Use” would give them the push they needed to get off of the ground.