McKesson has long been viewed by many in healthcare as perhaps the industry's hungriest omnivore among IT vendors. With numerous divisions covering the waterfront from pharmaceuticals to robotics to managed care to the hospital sector, the company has gone through several cycles of acquisition-fueled growth in the past two decades.
And the Alpharetta, Ga.-based McKesson Provider Technologies, the patient care side of the business, has been a phenomenal acquirer of smaller IT vendors, to the point where some sort of McKesson software is now running in fully 5,000 hospitals in the United States and touching 200,000 physicians. The company's revenues rose from $1.3 billion in 2005 to $1.5 billion in 2006.
Meanwhile, its February acquisition of Seattle-based Practice Partner — formerly Physician Microsystems Inc., a provider of electronic medical record, medical billing, and scheduling systems for physician offices — added yet another link to its chain of provider offerings.
Still, says Pamela Pure, president of McKesson Provider Technologies, it would be a misperception to believe that the company wants to be all things to all people.
“The reality is that McKesson, as a Fortune 16 company, has a unique footprint in healthcare,” says Pure, who has been with the company since 2001 and been the provider division's president since 2004. “And we see some major components that need to be automated for streamlined care. So we feel we can make a major contribution to the automation of the hospital, the physician's office, and to the connectivity between them.”
Its acquisitions continue to be strategic, she says. McKesson acquires “to provide supplemental or surround applications around (the company's) core.” Medical imaging, billing and revenue cycle management, and physician office EMR are examples. The Per-Se acquisition helped McKesson fill in a gap in terms of billing and revenue cycle management, she notes, as Practice Partner did with regard to office-based EMR capability.
In fact, Pure wants the industry to know that McKesson has been steadily working on its image since the period during the last decade when its fast-track acquisition strategy led to dissatisfaction over customer support levels and complaints over lack of integration and interoperability of the company's core clinical and other solutions.
“I actually think there was a time when those accusations had some accuracy,” Pure says. “As the result of business decisions when acquiring, you lose some of the management of the acquired company; so you have service issues, innovation issues, growth issues. And we ran into all of those as an organization in the late '90s.”
As a result of the problems, McKesson leaders stopped acquisitions between about 1999 and 2002 and moved to address complaints and to “stabilize the products we had, and earn back the respect of our customers,” Pure says. Adopting “core principles” of service and customer support has helped McKesson revive its public image, even as it has rebounded into a new round of acquisitions in the past few years, she adds.
The result of some of this internal work has been recognition for McKesson's solutions. For example, the KLAS 2006 Mid-Year Report Card issued by the Orem, Utah-based KLAS Enterprises LLC put McKesson solutions in the top three for 16 different KLAS categories, while its Paragon and Horizon Medical Imaging both were ranked number one in their respective categories. None of these recognitions come by accident, Pure concludes. These days, she says, “We're really focused on retaining our employees, and making sure our employees believe they're working at a great place, and that they're a part of great change in healthcare.”