Is the Same on the Horizon for Established EHR Companies?
With the requirement for interoperability to support the Meaningful Use, payment reform and care coordination goals of the federal government and private payers, the same conundrum is now facing established EHR vendors who deploy their software using a client service methodology. Changing standards, increasing integrations and growth in health information exchange are requiring these companies to rapidly produce modifications to their software and deploy it through upgrades on various platforms and operating system versions. Changes like these generally impact older, established players more profoundly because their customers are on older technology and there are simply more customers to upgrade if they are deployed in a decentralized way.
Most of the larger EHR companies in today’s market are the new entrants competing with the established goliaths during the ANSI transition. Unfortunately, the largest of these organizations deploy their technology on “old school, trusted” deployment methods because their leadership came from previous consolidations within the PM industry. They did not embrace the ASP and SaaS technology as it wasn’t familiar or proven at the time. However, I do not believe that client server deployment is sustainable over time because:
- Maintenance fees will not create the margins necessary for innovative development resulting in SaaS and ASP functionality to overtake client server versions
- Physician practices generally do not employ hardware, network and systems administration staff capable of more complex upgrades and integration/interoperability system monitoring
- Physicians will not budget for the capital costs associated with an ever increasing hardware obsolescence cycle
- Government mandates will continue to accelerate deadlines for vendor upgrade schedules to meet incentives
- Market forces will continue to increase modifications in EHRs to meet evolving protocols, practice patterns and payment mechanisms – all of which will require EHR functionality modification
ASP and SaaS versions of software are simply much easier to maintain, modify, upgrade and deploy than client server technology which reduces up-front costs and implementation times. With added security and trust of cloud based technology, client server applications will be left on the ground. And honestly, would you rather be tethered to the ground with a obsolete hardware anchor or soar into the clouds – especially if soaring costs less and is hassle free?
John Tempesco, FACHE, is the Chief Marketing Officer at ICA. This blog post was first published on ICA’s HITme Blog. John has 37 years of healthcare experience, including a two decade career in health information technology in both the government and civilian sectors. He is a Fellow in both the American College of Healthcare Executives and the Life Management Institute, as well as a Certified Managed Care Executive.