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Nuance: The Spoken Word

May 29, 2009
by Mark Hagland
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Unless physicians adopt a much different view of typing, Nuance has a solid future with its voice recognition solutions

John halamka, m.d.

John Halamka, M.D.

One of the biggest challenges for any software vendor is balancing the need to provide innovative, skate-to-where-the-puck-is-going solutions, with satisfying the customer needs of today. One company that has gone to extraordinary lengths to get it right is Burlington, Mass.-based Nuance Communications, Inc.

After spending $357 million to acquire Stratford, Conn.-based Dictaphone Corporation in February 2006, Nuance moved to integrate the two companies' offerings, expand its platform, and capture maximum market share. The core of its offerings remains its Dragon Naturally Speaking voice-recognition technology, which has gone through multiple releases and enhancements. That product alone has 100,000 users in North America, Nuance executives say. What's more, they estimate that over 20 percent of physicians in North America are using their solutions, while the company boasts more than 3,000 hospital customers.

Ben rooks

Ben Rooks

And the company is looking relatively strong in what has been a jittery market for healthcare stocks. Nuance reported revenues of $216.8 million in the quarter ending Dec. 31, 2008, an 11 percent increase over revenues of $195 million for the same period last year.

What's particularly interesting about Nuance is how the company has created and enhanced a diverse platform of product categories focusing on several different groups of users. The three largest ones are radiology/diagnostic imaging; speech-enabled transcription for health information management in the acute-care (and increasingly ambulatory) sphere; and the EHR-focused line of business, looking at both acute-care and ambulatory physicians. Though the fundamental products are similar, specific features accommodate the different workflow patterns of different users. For example, radiologists, who are under pressure to produce more reports more quickly for their referring physicians, are self-editing 90 percent of the time; while attending and staff physicians using the other two products are only self-editing 10 percent of the time.

Still, that means given the 90 percent accuracy of voice-recognition capture, those health information management professionals who are editing the voice-dictated documents in the system and returning them to physicians are part of what the company claims is a huge cost savings to the industry. Indeed, many organizations are now referring to those people as “correctionists,” since they are no longer doing original transcription. As a result, Nuance executives believe they are saving hospitals $200-300 million a year across North America in traditional transcription costs.

Proof is in the pudding

Healthcare customers are looking at the practical application of technology to facilitate processes that simply must take place in an electronic world. John Halamka, M.D., vice president and CIO of Beth Israel Deaconess Medical Center in Boston, says, “We have to implement electronic health records for every physician in America by 2014. So how are you going to get the data into that? Nuance offers a server-based solution that doesn't require me to install tons of hardware and software. So it is a tool for me to foster adoption and use of electronic health records.”

For Halamka, the question is practical. “Doctors have 12 minutes to see the average patient” during the typical physician visit, he notes. “And they have no choice but to input certain kinds of structured data; but there are ways to speed up the process of getting unstructured data into the electronic record,” he says, voice recognition being one of them.

Halamka goes on to emphasize the need to implement tools early on in the automation process that improve productivity. As he puts it, “Planning for clinical IS implementations is like telling doctors, ‘You're going to lose 25 percent of your productivity, you won't have dinner with your spouse for six months, and it will cost you $40,000.’ And that's not an easy sell. So basically, what an electronic dictation or server-side voice recognition device does is to save you time and enhance productivity and save money, so it makes an electronic health record easier to sell.”

Making EMRs easier to sell is a goal for John Shagoury, president of Nuance's healthcare division, who says he feels good about the company's trajectory because of its role in the process. “At the end of the day, our goal is to produce improved care quality and cost savings and do it in a way that causes minimal disruption to physician behavior.” The key, he says, is to help physicians become more productive without forcing too much change. “They're willing to change their behavior to a degree, but only to a degree.”

What about keyboarding?

One of the key questions in all this is where the trajectory of practice patterns will take physicians and the industry. Ben Rooks, principal, ST Advisors, L.L.C., a healthcare strategic advisory firm based in Evanston, Ill., says, “Ultimately, I do think voice recognition will get less and less important. But if you asked me 10 years ago, would transcription or voice recognition be dead by 2009, I would have said yes. But we'll continue this way for a while, because physicians do not want to adopt new technology (such as EMRs which require them to type), and this is ubiquitous, fast, and easy.”