In 2016, community hospitals (less than 200 beds) made electronic medical record (EMR) purchasing decisions at one of the highest rates seen in years, accounting for almost 80 percent of all hospital EMR decisions in the United States, according to a new KLAS Clinical Market Share Report.
The Orem, Utah-based KLAS compiled its report on U.S. hospital EMR market share based on acute care EMR purchasing activity that occurred in the United States from Jan. 1 to Dec. 31, 2016. T
According to KLAS, the small hospital market movement was fueled by “continued growth of the community-specific platforms from Cerner and Epic, the acquisition and EMR-standardization activity of larger organizations, and smaller hospitals’ increased interest in athenahealth’s new hospital offering.”
For Epic, Cerner and athenahealth, 2016 was a big year in the acute care hospital market, yet other vendors, such as MEDITECH and McKesson, struggled to keep their footing.
New data from KLAS finds that Cerner is seeing the greatest increase in small hospital market share, as small hospitals moved to Cerner more than any other vendor in 2016, accounting for the vast majority of Cerner’s growth. According to KLAS researchers, “Cerner CommunityWorks is a large draw for small hospitals due to its breadth of functionality and integration, though provider satisfaction is middle of the road.” Further, the KLAS report states, “Looking for greater interoperability with nearby Epic hospitals at a feasible price point, small standalone hospitals also contracted for Epic Community Connect. One pain point reported by community customers of both Cerner and Epic is a lack of customization capabilities.”
For six years, Epic continues to be the leader in net acute care hospital growth and the company continues to increase its lead in overall acute care hospital market share. Epic’s 2016 acute care hospital market share stands at 25.8 percent, compared to Cerner’s 24.6 percent market share. “Epic’s integration and track record of customer-to-vendor trust continue to drive loyalty and market growth, particularly among larger organizations and IDNs (multihospital organizations). Over 50 percent of IDN contracts (13 of 23) went to Epic,” the KLAS report states.
There were two hospitals that left Epic in 2016, however, according to KLAS these hospitals did so involuntarily as a result of being spun off or acquired. “About 25 percent of IDNs (6) chose Cerner in 2016, drawn to Millennium’s integration and flexibility for customization. One of these IDN contracts was for an organization of 30 micro-hospitals (<15 beds). Providers who chose Allscripts in 2016 often had a prior relationship with the vendor and were hoping to standardize to a single EMR across their healthcare organization,” the KLAS report states.
athenahealth’s expansion is continuing to disrupt the small hospital market, the KLAS report finds. The number of hospitals that contracted with athenahealth more than doubled in 2016, with one-third of those being hospitals with over 25 beds. The vendor’s web-based platform, unique cost structure (percent of collections), and inpatient/outpatient integration are all a draw to providers, according to KLAS’ research. “Perceived functionality gaps in ancillary departments cause some customers to leave and some potential customers to choose other options. With sales energy high, KLAS will be looking to validate athenahealth’s ability to scale and perform consistently for hospitals,” the report stated.
Looking at other vendors in the acute care hospital market, KLAS reports that MEDITECH, McKesson and CPSI have all experienced multi-year net losses. “The majority of customers leaving MEDITECH report insufficient development and skepticism that the vendor will be able to meet future needs,” according to the KLAS report. “However, there are early indications that the release of MEDITECH’s integrated ambulatory offering and new development on the inpatient side are changing the market’s perception of MEDITECH.”
McKesson Paragon saw high losses, and no new wins were reported to KLAS. “Many users feel Paragon does not meet their needs, and many are uncertain about its future due to McKesson’s plans to sell it. About half of the hospitals that left CPSI (both Evident and Healthland platforms) switched to athenahealth, citing CPSI’s poor usability, development, and support,” KLAS researchers wrote in the report.