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Does Wal-Mart know what it's getting into?

March 12, 2009
by Neal Ganguly
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http://www.nytimes.com/2009/03/11/business/11record.html?scp=1andsq=walmart%20doctorsandst=cse

No doubt, by now you have seen the New York Times article, or some interpretation of it. The nations largest discount retailer is getting into the EHR business by teaming with eClinicalWorks and Dell to offer a discounted package to the approximately 200,000 clinicians that are Sam’s Club members. They’re betting that they use their traditional model of leveraging their volume purchasing clout to deliver a commodity service at a deep discount. That works great for commodity items such as laundry detergent, toilet paper, and tires – but does it translate to services like EHRs? It is true that PCs have become a commodity product for the most part, but is the physician office based EHR a concept that is mature enough to be considered a commodity? I would argue not.

In marketing to physician, particularly small practices, Wal-Mart is approaching a very demanding, yet often frugal, group. While Dell, may have a sweet deal in selling a bunch of PCs, eClinicalWorks will have to be able to flex its staffing quickly to be able to deploy systems and configure them to meet to wide range of expectations for this demanding client base. What if those expectations aren’t met? (or even possible to meet?) Will the doctor’s allow Wal-Mart to sell and run? Will Wal-Mart have to step in and offer customer service if expectations are not met, or will they refer all customers to eClinicalWorks directly? What about the dreaded “I” word? Yes, I said it. Interfaces to other doctors (no everyone will be using eClinicalWorks – will they?), hospitals, labs, etc. Will eClinicalWorks be ready to support the demand? Lot’s of questions.

Clearly the article does not get into detail on these things, and perhaps the parties involved have worked all this out. Clearly all three are successful businesses with solid track records. But this is a different sort of market for Wal-Mart, and expectations can be a tricky thing. If Wal-Mart can pull off the commoditization of the EHR, then this will indeed be a ‘game changer’ as David Brailer said. Either way, this will certainly be one to watch.

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Comments

I echo the concerns articulated here. I really worry that the notion of "commoditizing" EHRs will mean a lapse in the detailed planning that is necessary to make these types of implementations a success. Sign here, and we will plop a system into your practice! That almost sounds like the expectation and it is consistent with the brand image that Wal-mart has been so effective in crafting for themselves.

The point about interfaces is particularly poignant as there will be a multitude of different provider-specific needs, and I am not sure that the players who are involved in this are ready to take on these needs, especially at the price point that Wal-Mart will be selling, and this may result in disappointment, frustration, and a reluctance to embark on something like this on a grander scale, should it become necessary (as it likely will).

Amen to that Michael!

It would be nice for us to be able to better manage customer expectations as an industry. Jim Feldbaum's post on the local leadership vacuum is an interesting perspective on what's missing in today's environment.

Installing and configuring an EHR is a lot different than putting Microsoft Word on your PC. A successful implementation requires workflow redesign, specialized training, and customization. eClinicalWorks is a fairly basic system, but it is still not plug-and-play. (My experience with them has also found them lacking in the service and support areas.)

What I'm afraid we'll see happen is too many out of the box installations that don't meet the needs of the clinicians, resulting in a large group of physicians soured on the idea of an effective EHR.

Wal-Mart needs to stay out of things they don't understand.

Thanks for the comments guys. Jim Feldbaum has another good post on this topic as well. What is the world coming to?

Neal. In my opinion, your analysis of the questions and problems are spot-on. Wal-Mart is an amazing company, but if anything can beat it, it will be implementing EMRs in one and two doctor practices. You are also correct about the demand this will put on eclinicalworks. Interestingly, KLAS is putting out a report on that company. This is the first time I can recall KLAS doing a single-vendor specific report. We are posting a news item about the report today, so check that area of the site. I will link to it here when the item goes live.

Neal Ganguly

CIO, CentraState Healthcare System, Freehold, New Jersey

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