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One-on-One With KLAS President Adam Gale

August 31, 2009
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Gale discusses a HITECH buying frenzy that wasn't, & why Epic's page of the Mid-Term Performance Review makes competitors green with envy

Adam Gale

Adam Gale

As the HIT Policy Committee and its certification workgroup grapple with the fate of CCHIT, many discuss the importance of providing buyers with a “Good Housekeeping” seal of approval. Few, however, directly admit that what they really want is already being produced in the form of KLAS reports. Leafing through one of the organization's two main vendor performance reviews is a fascinating exercise for any industry observer, or critical for any potential buyer of a multi-, multi-million dollar system. In light of KLAS' unique role in the industry, HCI Editor-in-Chief Anthony Guerra recently grabbed a few minutes with President Adam Gale to talk about the trends roiling healthcare IT.

GUERRA: Many people thought HITECH was going to cause a huge wave of buying, do you think that has happened? If not, might there still be too much ambiguity around meaningful use to move the market?

GALE: While it's hard to tell, it certainly hasn't led to that frenzy yet. We haven't seen the huge wave of buying that I think people were hoping would come in the first few months. I think the reality is there were few people who were ready to go. By that, I mean there were few people who had their plan in place on what vendor they wanted to select; people who had their implementation timeline in place and all they needed to figure out was the funding. I've talked to two or three organizations like that who basically moved ahead, but they already had a plan in place and were just waiting for some money.

Most of the organizations we talk to today are looking at buying, but this has not sped up the actual action of buying. It sped up the homework; it sped up a lot of discussions with vendors. Many of the vendors we're talking with are having all kinds of solid sales discussions with people. Vendors are telling me their pipelines are really full, but how much of that is real buying activity versus sniffing around is hard to tell. I have people telling me that there are a lot of Meditech sites sniffing around to find out what the options are. Some of that is caused by ARRA and the fear that they won't be able to get their physicians to adopt an older MAGIC system, and some of that is Meditech's move to Version 6, which means customers would have to spend a reasonable amount of money moving forward. That drives them to go look at other options, but at the end of the day, a lot of these folks are probably going to stay with Meditech. Not all, I mean, there will certainly be several that move, but it creates a buzz around potential buying activity.

GUERRA: You would have to assume that most people will try and get what they need out of their current vendors rather than switching. Does that make sense?

GALE: It does. Definitely, people are leaning on their current vendors, although I've been surprised at how many are having at least what seem like real discussions on switching their vendors. I was out with a hospital two or three weeks ago which had bought a system three or four years ago. Right now, they're in the middle of implementing it and in the middle of moving to CPOE and they're having very real conversations like, “We think it's going to be better now to move to a new system rather than wait 4, 5 or 10 years to when our system would have normally come to a natural end,” and so they're looking closely at buying a more current system.

Another big organization called us and said, “We're pausing our implementation of a system we just bought two years ago until we're sure we don't want to implement this other vendor.” So HITECH is causing a lot of pausing, homework and discussions, but that just hasn't equaled buying from what we've seen yet.

GUERRA: I interviewed the CIO at NYU Medical Center, Paul Conocenti, recently and he told me that when he first started there, the organization had an inpatient vision, and he selected a system according to that strategy (Eclipsys); but now, the organization has a continuity-of-care vision, and so they are going with Epic. Do you think we'll see more of that kind of thing?

GALE: Absolutely. So the site which I had mentioned bought a system almost four years ago and is implementing it, their key strategy changed to now look at the ambulatory world and probably employ a whole bunch of physicians (as opposed to just giving privileges to independent doctors). And they feel like the vendor they've gone with isn't a very good option for tying in employed physicians. So, they too are looking at Epic saying, “Hey, if we're going to have all this ambulatory work going on, we may need to have a totally different strategy.” A number of these organizations may simply choose to go with a different vendor for their ambulatory solution with potentially a long-term shift over to a company like Epic, for example, which can easily move into the inpatient world. So, we're seeing quite a few folks looking at Epic for ambulatory with a long-term, five-to-seven-year plan to swap out their inpatient.