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

March 12, 2009
by Neal Ganguly
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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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