From INVISIONforever: “Re: Soarian. I checked the Siemens website to see what it was saying about Soarian. Soarian Financials is no longer being touted as a solution for hospital and MD billing. Is this an error or a reflection of a diminished goal? Also, I was surprised to see Soarian Scheduling listed as a revenue cycle solution — it doesn’t even have an insurance master. Under Soarian Departmental Systems, only Cardiology is listed. If you compare this with their promises four years ago, the disparity is huge.” Speaking of Soarian financials, guess who’s just signed for them: Partners (!) They’ll implement scheduling, decision support, document management, community access, and payor connectivity. John Glaser had mentioned in an Inside Healthcare Computing interview that he had a big Siemens revenue cycle project upcoming and some SOA initiatives, but this caught me off guard. Certainly it’s a much-needed boost for Siemens, assuming that their stuff works, anyway.

From Hrundi V. Bakshi: “Re: Lawson. The Lawson project at Mayo was overrun and under functional. Many physicians are complaining. They can’t tell a consult/revisit/new patient from one encounter to another, much less from one facility charge to another. They can’t reconcile medicare patients from one facility to another. It’s often taking physicians 12-25 minutes per encounter to do documentation. The non-MD in charge doesn’t seem to ask doctors what makes sense. Mayo’s IT/Finance strategy needs some serious updating in personnel, vision, and education. They’re aptly set to be the laggard of adoption and questionable due diligence.”

From Molly Clutterbuck: “Re: Cisco and AHA. It’s not objective based on performance, so what’s it based on? Cisco is getting their clocks cleaned in healthcare by better performing vendors. First they bought a HIMSS user group, now they’ve paid for AHA’s ‘recommendation’. Those involved need to get off the speakers’ tour long enough to look at what’s happening with Cisco in wireless. I never knew the AHA to be all that interested in IT. Where have they been all these years?”

From Venny: “Re: Craig Barrett’s horses. Damn the EMR. To boost Intel, he needs to market chips to his four-legged friends. Who knew horses could read e-mails? Are cow chips next?”

From Bernard Stein: “Re: Misys. You are slow on the Misys news. More high level departures.” Maybe my former sources aren’t there any more since nobody’s spreading a little rumor love HIStalk’s way. I’ve not heard anything about exodi. But, Vern Davenport is hinting at acquisitions and says the realignment is 85% done. He agrees with boss Mike Lawrie (always a good idea) that the company’s healthcare “performance remains poor”.

July will be another record HIStalk month. So far: 51,416 visits, 88,156 page views (that doesn’t count RSS readers). Both measures doubled in the past year and trended highly up later in the month. And for that, I thank you and HIStalk’s sponsors.

I should also mention Brev+IT, the weekly e-mail newsletter that starts this weekend. Now about the name: I’m merciless when somebody makes a lame pun involving the letters IT, but it fit so well in this case that I’m willing to humbly accept the inevitable scorn. The main message I wanted to get across is that it will be highly concise, covering only the five most important stories of the week, and with background information and opinion to put it into context (thus the name, which I hope you’ll pronounce “brevity.” Get it? Or is that “Get IT”?) HIStalk is for industry lifers who love the insider stuff, while Brev+IT will get executives up to speed in minutes. See the sample. You’ll notice one tiny spot for a sponsor text ad, which I’ll most likely offer to existing Platinum sponsors at no extra charge. There’s a sign-up form to your right (on HIStalk2 only for now until my HTML guy gets it prettied up). Lots of folks are signing up already, so maybe it’s redundant for me to invite you to do the same.

The Wall Street Journal quotes Microsoft as saying it’s expanding its healthcare efforts: 20 new employees stateside (doctors and other clinicians) and 30 in China (developers). The healthcare group is supposedly given free rein as one of a handful of areas in which MSFT sees big potential.

A long-time reader is in need of a job description for Manager of Cardiovascular Informatics. If you have one, please shoot it to me. Thanks.

Bankrupt Bayonne Medical Center (NJ) finds a Santa Claus willing to pay for a new EMR system: you. Or more specifically, your Federal tax dollars.

Stanford University will offer AMIA’s 10×10 informatics program.

Rhode Island will create a statewide Health Information Exchange, with EDS as the primary contractor and InterSystems providing its HealthShare platform.

Talk to me.

TPD or Mr. HIStalk - any chance you can interview someone at UPMC about their lessons learned from virtualization? The early information is hitting the usual magazines, but it is a little sanitized for my taste. [Inga is working on that, Art. Good idea.]

Virtualization is the only way to get close to the necessary efficiency with the limitations of most of our cottage industry’s vendors. Even getting them to accept virtualization is a tough sell. But, even if you use it only for development purposes, it is cost effective. Less hardware, you use it only when you need it, and you have fewer physical server instances to patch.

For those of you who can’t do or sell anything without a maturity model, here is a first cut we can iterate as an industry. Who says we are not innovative?

Level 1
Can you help me spell that? I could heat a homeless shelter in Alaska from the number of servers (mostly Windows and Intel) I have in the data center.

Level 2
I am running VMWare for my developers on the PCs to test the five different versions of Windows clients on eight different PC hardware configurations we have out there. AND I approached my 300 vendors, of which 20 knew what I was talking about, five said they’d consider it if we upgraded to a current version from the one we run that’s four releases out-of-date, three said OK and they’d have their top tech guru contact me (that was seven months ago), two said they’d have to report me to their manager for using bad language, and one said they’d do it if we’d pay a higher maintenance fee.

Level 3
Just doing it without vendor blessing for all those fine two-tier, Windows server-based development servers. AND virtualizing tape back-up and storage (damn, TPD - you’re already to Level 3).

Level 4
After wasting five man-years of effort, outsourcing it to someone else and making it their problem, while paying too much for the service.

Level 5
Getting your ERP vendor to virtualize some of their 20 servers, storage, and tape devices. Come on now, you thought that we can even talk about a healthcare vendor doing this for another five years? The rest of the world has two years’ of experience on us right now.

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From Claude LaMont: “Re: Acermed. They sure appear to have closed up shop. A physician on our medical staff was teed up for hardware install this week. Tech never showed up. Doc called sales guy at home, only to be told that company told him on 7/20 that company had folded and he was terminated. Doc is out a bunch of cash for hardware he cannot use. Nice of the vendor to call, isn’t it?” So much for the idea that CCHIT-certified products are less risky for buyers. Neither, apparently, are those applications that are highly rated by self-proclaimed futurist Mark Anderson of AC Group, who’s taking shots broadside over at EMRUpdate for his company’s previous lofty rankings of Acermed. He posted one rebuttal: “We never had Acermed rated number 1″, but hasn’t posted again in the several days since a reader pointed out of this link or this one. One made this comment: “Mark, when you make your EMR evaluations transparent, no one will question the results. When an EMR that you highly rated goes belly up a few months after your positive rating, and you say you take into account financial viability of the company, people will wonder how good your ratings are.” Some were nastier, either accusing him of various improprieties or demanding to see his raw data (I got a few of those e-mails after we ran some comments he was nice enough to provide a few weeks back). In his defense, Anderson calls himself a futurist, not a clairvoyant, and Acermed’s problems may involve neither functionality nor financial viability. It sounds like a spat among the owners. Bad for their customers, bad for other PM/EMR vendors without a long corporate pedigree, and bad for CCHIT.

From Sore-Ian: “Re: Soarian sales. Siemens is a company known for fine German engineering. I wonder how much of the Soarian fiasco has to do with the old dysfunctional SMS culture and politics in Malvern dominating the German kultur? A conversation I had there a few months ago suggested the new people who had not been SMS’ers were looking for ways to deal with the latter’s American-big-bad-IT ways.”

From The PACS Designer: “Re: virtualization. TPD did a piece on virtualization earlier this year, but felt it was worth repeating. You will be hearing a lot about the use of virtualization to improve organizational efficiency over the next few years and some of the successes that institutions have achieved by going virtual. Yes, you will be hearing from department managers about how they need to keep their local storage solution, but with the newer software tools and faster networks, the attraction of redundant storage should make the conversion to the virtual world of storage even more palatable now. Setting up a virtual server through partitioning and making the storage archive a virtual application can save considerable amounts of money through such a venture. Also, the local storage solution can still be kept as a redundant archive to appease the manager when there is considerable resistance to change.”

From Paul Burmaster: “Re: CIOs. At the recent AHA Leadership Summit, you could pick out the CIOs by their dress. Wisdom suggests you should dress one or two levels up. Some yahoo was there in shorts, and yes, he was a CIO. I love to relax and be casual, but there’s a time to dress for success.” 

Atos Healthcare is released from its $500 million UK HNS diagnostic imaging contract after missing deadlines.

Visicu announces Q2 numbers: revenue up 21%, EPS $0.06 vs. $0.04.

McKesson announces for Q1: revenue up 5%, EPS $0.77 vs. $0.60. Technology revenue was up 49% and profits up 178%, great news for shareholders (maybe less so for customers whose payments made it possible).

Former IDX CFO Jack Kane is appointed to athenahealth’s board.

Cardinal Health pays a $35 million penalty to settle SEC charges of inflating revenue and earnings.

One recommendation of a Presidential commission reviewing the care of veterans is an online electronic medical record. Cleveland Clinic CIO Martin Harris is a member.

What the hell is the American Hospital Association doing running a for-profit subsidiary that shills vendor products to its members? “AHA Solutions, Inc. is a subsidiary of the American Hospital Association that collaborates with companies to create strategic financial, technology, regulatory, employee benefit, and insurance products and services for healthcare professionals.” I hadn’t heard about it until I noticed their ringing endorsement of Cisco, apparently rubber stamped by “a group of influential IT leaders from AHA member hospitals”. Is the implication that less-influential hospital IT professionals (i.e., unwashed rubes) can’t be trusted to make wise IT decisions? Or, that vendors who don’t pay financial tribute to AHA aren’t reliable? Let’s hope no one running a hospital IT shop is so clueless as to need AHA’s sponsor-fueled guidance. Looks like the AHA folks running the enterprise are marketing people with no stated healthcare background. Joint Commission does it, HIMSS does it, AHA does it … but that still doesn’t make it right. Non-profit hospitals should insist that those claiming to represent them be non-profit as well.

The former CEO of imaging vendor A.L.I. is having a ball with the $35 million he pocketed after McKesson bought the company in 2002.

Lawson’s Q4 numbers: revenue up 69%, EPS $0.04 vs. -$0.03, but the company cautioned on 2008 prospects.

Intel’s Craig Barrett issues more homespun sound bites about healthcare IT: “‘I have a ranch with 45 horses, and they all have electronic medical records, and they all get e-mail updates when their shots are needed,’ he told the summit.The difference is that veterinarians work in a competitive market that gives an advantage to those who adopt technology,while the health-care industry has much less incentive to change, Barrett explained in an interview afterward.” And this one: “It’s time for health care to turn from a mainframe-computer industry to a personal-computer industry.” Want to guess which one he sells chips for? Hey, do your part: buy AMD desktops and servers instead of Intel and invest the difference in charity care. That will send a message to Mr. Barrett and the horse he rode in on (even if he’s right, he’s awfully smug about it).

Talk to me.

Allscripts has been selected to provide its EMR to Urology Associates of North Texas, the country’s largest private urology group. The 50-doctor group had previously been using Penchart/Amicore and will integrate the Allscripts product with their old IDX Groupcast (Centricity Business) practice management product. Penchart/Amicore, by the way, is the product that Misys bought to develop as an ASP solution – and later dropped entirely. Though they don’t mention Misys by name, the UANT medical director was quoted as saying, “We’ve experienced what happens when vendors don’t keep up with changes in a dynamic industry.” Ouch.

Allscripts also made news last week when announcing a new initiative with Sprint to use smartphones to generate prescriptions in the exam room. Sprint will be donating up to 1,000 devices to prescribers who register for the National ePrescribing Patient Safety Iniative and activate NEPSI’s Web-based eRx NOW software.

Pioneer Medical Group of Cerritos, CA signs up with MED3000 for a five-year ASP hosted agreement for Allscripts Touchworks EMR. Pioneer Medical has over 50 providers in Los Angeles. (Either Allscripts is getting their PR machine in gear or they are in the midst of a good run.)

TriZetto names Robert G. Barbieri as the incoming CFO. Barbieri comes most recently from Lawson Software, where he served as CFO and Performance Officer. (Does his appointment mess up Mr. HIStalk’s – and Yahoo’s – theory that Misys is considering a TriZetto acquisition?)

Inga’s listening.

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From Ambulatory_Vendor: “Re: Sage. Fallout from the layoffs? We’ve been receiving calls from Sage customers who have been unable to get support for weeks.” Unverified. I’ll ask Inga to follow up.

From Judith Beasley: “Re: Soarian. 2005, zero sales. 2006, zero sales. 2007, no sales yet. Soarian development costs are now over $150 million per year. Siemens can and will continue bleeding for a long time. The Susquehanna CIO is now a Siemens employee. Guess that will keep vitriolic e-mails from showing up in HIStalk.” Unverified. If anyone has facts, please elaborate.

From Mia Hottie: “Just a clarification on the Cerner product I mentioned yesterday. It’s not the Visicu-like remote monitoring product, but rather the ICU EMR that would compete with Picis or Sunrise Critical Care, for instance. Cerner announced iNet at least five years ago and, as usual, it was a toe in the water and was never been completed or well done.” Thanks.

From ExCPRUser: “Re: CPR. The combination of an archaic architecture (remember UltiMumps?) and lack of any real integration among CPOE, nursing, and rad/lab will eventually sink them.”

From RonA: “Re: QuadraMed and Vista Equity Partners. Dumb and dumber. Dumb: QuadraMed admits they can’t deliver a clinical product, throws in the towel, and buys an orphaned clinical system. HDS, Per-Se, and Misys couldn’t sell it, so what makes QD think they can? Dumber: Vista Equity Partners buys the junkyard of legacy standalone systems for $382M. Do you really think Vista Equity will invest more in these products? Both of these are feeble attempts to add value to challenged businesses and then sell it to someone even dumber.” 

From Jeff: “Re: KLAS. I think KLAS bends over backwards to provide an impartial opinion, but the key is that KLAS is only one indicator anyone should use to evaluate a vendor. There are many ways to substantiate or repute what a KLAS report might contain, so rather then ‘crying wolf’ because a vendor is not getting a great ranking, include in your opinion other factors, like making some reference calls, talking with the vendor about their vision vis-a-vis yours, and going to trade shows to see how others view the vendor. KLAS may not be perfect, but it is a great starting point for anyone.”

From Rufus: “Re: Anne Arundel. Rumor has it that Anne Arundel Medical Center (Annapolis, MD) might be ripping out Meditech and replacing it with Cerner. Their relatively new CIO is an ex-Cerner employee. Seems like a giant expense and burden. Questions: 1) true?  2) why?” Unverified.

From The Shelton Shadow: “Re: Lawson. TSS has been investigating a new possible takeover candidate who is partially in the healthcare space. That  company is Lawson Software. Don’t know yet who the suitor is, but one sign that something is up is that they have disabled their ‘Partner Network’ on their website. Only time will tell if it is one of the big players in healthcare or a private equity group.”

From Russel Ziskey: “Re: Google and the advisory team. Add Intuit to the list of organizations that maybe doesn’t get it. They announced a product over a year ago and nothing is released. Their division GM, head of bus dev/ strategy, and head of product dev are all gone. Also, the issue is not one of needing an RN to help think through what to get. The truth of the matter is that there are too many vendors from too many different angles trying to solve a need that doesn’t exist (let’s leverage our EMR, our claims data, whatever to deliver a PHR to consumers so they will manage their health and we will get $$). The reality is that consumers say they want a PHR (you have to - it’s like saying you should go to church). But, do you go every Sunday? Adoption is low, no one will pay, and standards certainly do not help - each player tries to protect their own interests.”

Cerner’s Q2 numbers: revenue up 17%, EPS $0.37 vs. $0.29, meeting expectations. The stock was down over 4% today as financial types realized that Cerner’s $26 million in NHS revenue brought along a 0% profit margin and decided the company’s expenses were too high.

OK, it’s usually pretty quiet on HIStalk in the evening. Right now, there are 51 readers on, some who’ve been there for more than 30 minutes (according to my stats service). Visitors from the past week would extrapolate to 61,889 per month, with 112,000 page views. Obviously, this will be a record month. Who knew there were 2,000 people each day who care enough about healthcare IT to hang around some anonymous guy’s blog? Join me in giving yourself a round of applause. And if you want to connect with each other, give HIStalk Discussion a spin.

University General Hospital Systems (TX) signs an exclusive agreement with Calence for network services. The press release uses the word “luxury” and “five-star” a little more than I’d like for a hospital chain, even if they are for-profit.

This ZDNet editorial is critical of the single announcement that Misys is considering an open source EMR release. “Its medical records product was already being pressured by OpenEMR, a GPL product … The current Misys Web site is terribly opaque. If Misys wants to compete effectively in open source that will have to change fast. Open source is more than free code, it’s a transparent way of doing business.”

University of Florida and IBM announce standards-based middleware to connect home monitoring devices to physician offices. “It would then be possible to buy a device off the shelf and by dialing a 1-800 phone number establish a connection between the device and one’s doctor. ‘The device itself becomes a service,’ he said.”

Cardinal Health says it has developed a better outcomes model for pay-for-performance programs. The big improvement came from adding lab data to the mix, which predicted mortality better than any other indicator, up to 67 times more important than administrative data.

FCG and InterSystems will jointly offer integration and business services to hospitals in India.

News, rumors, privaty equity investment opportunities: e-mail me.

Mr. HIStalk suggested I try to track down a CPR client to find out their perspective on the sale of the Misys CPR product to QuadraMed. I was lucky enough to catch Dave Paulson, Manager of Clinical System Support for St. Francis Health System in Tulsa, OK. He admitted he had plenty of thoughts on the whole situation and took the time to share them with our readers. Thanks, Dave!

What are your thoughts on the sale of CPR to QuadraMed?

I was very involved with the Misys leadership when they initially purchased Patient1 from Per-Se four years ago. I met with those guys and asked questions. With the Per-Se management, they had ideas but not resources to move the product forward. We were thrilled to hear what Misys management had to say. The CPR product is our lifeblood. It does everything. It’s huge for us and we need it to be continually developed and moved forward.

Misys said they realized they would do three things with regard to CPR and its development. They said, “We aren’t going to be invited to the dance unless we move from a proprietary platform to Cache’. We aren’t going to be asked to respond to RFPs because we are not Web-based. And, we have all these Sunquest lab clients now asking for the total package – they want integration with that product set.” So, those were the enhancements to be pushed by Misys.

Where Per-Se was not interested in supporting a user group for feedback, Misys was. I was very, very involved. Misys came in, devoted a lot of resources, but, about six months or a year ago, they had leadership changes and they ran out of steam when it came to focus on the CPR product. It wasn’t like some vendors that talk about things and don’t deliver. Misys just stopped talking about anything. Releases were pared down and delayed. And now, Misys has decided to be physician-focused.

We found ourselves back to where we were in the Per-Se days, but we need the vendor to move forth and advance the product. If it had been McKesson or GE or someone with products in the space to have bought CPR, it wouldn’t sit well with us. But it seems like, with QuadraMed, here is a vendor that has focus and wants to move things forward. My understanding is that the vendor staff that works on CPR is hearing good things thus far. They plan to keep people and they do have a good staff. I have not heard directly from anyone from QuadraMed yet.

I have talked to several other key CPR users in the last couple of days. We were frustrated that the CPR focus seemed to have been lost. Now people are cautiously optimistic that this is a good thing. This vendor gives us more reason to feel at ease than others.

Has the product been stable for you?

I think the product itself is stable. The one thing we really saw Misys bring to the table was improved quality of code. It just really became an issue of, “When will the next release with functionality that we want become available?” I assume that the same folks that have been working with us for the last eight years will continue and we won’t start getting support from a group that doesn’t know the product. That remains to be seen

When did you get your last update?

I think the last major release we took was about a year ago and they haven’t had one available since then. The next major release had been scheduled for release in August 2007, but that has been pushed back indefinitely. The next major release was planned for late 2006, then pushed to August 2007, then we were told they were pulling two major components and didn’t have a delivery date. The release is smaller and we don’t know when it will be available. You can appreciate frustration of the user community with something like that.

How fully are you using the system in nursing and ancillaries?

About as fully as it can be done. 100% of nursing staff is using it. The whole closed loop medication management process is fully online. Our Heart Hospital component is doing full CPOE and all the major ancillaries are using the medical records module. Sometimes I hear people say they need to look into getting single sign-on. I say, “What you need is one vendor.” It has worked well for us.

What is the CPOE utilization?

It is fully utilized in our Heart Hospital. We have three hospitals in Tulsa with 1,000 beds and the Heart Hospital has been our pilot.

Are orders being sent electronically from CPOE to pharmacy?

Yes. CPR does that fully. We have closed loop medication management.

Any problems with downtime or response time? Is the system solid?

Very solid. Really, no issues with down time and response time.

Have you ever considered switching to another system?

Yes, we have looked at that. We have had administrative changes and new management has asked if this is the horse we want to be on long term. You have to consider the cost to replace all that functionality. I cannot even fathom it. To try to replace full nursing documentation, all three major ancillaries … I don’t even know how you would do it. I can’t even imagine.

What are the best and worst things about CPR?

The best thing is the integrated nature and ability to view patient data from anywhere. The thing we have really needed from the vendor and which has been delayed multiple times is an enhancement to the clinical documentation toolset. We need it to provide more efficiency for nursing and physicians. We need something more EMR-like.

Secondarily, the pharmacy module needs to be updated and was to be included in the next release. The pharmacy module was one of the first modules to be ported to the Web. Our pharmacy folks are just still waiting for the changes. When I talk to people at QuadraMed, I will say those two areas need to continue to see focus.

Would you recommend CPR to others as it exists today?

Yes. Come and look at it if anyone needs to see what I just described. Cerner is going to talk about it, but we are going to show it to you.

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From Meat Beat Manifesto: “Re: Misys. Misys will be announcing a sales leader to take over the Misys Connect product. He is a former Cerner guy who has been with Misys less than a year. If they want to sell more EMR, they need to give Connect away or sell it as a subscription with a low monthly cost. Similar players (Healthvision and their competitors) already have a foothold, the community market is soft, and RHIOs are broke. All these things will make it hard to sell Connect like in the good old days (for $250K and up). By the way, conference calls are being held today to brief sales teams on the recent changes. Everyone had a fit when things started popping up in HIStalk.”

From Nick Cave: “Re: Sunquest. Who gets the name? Lab had it first so, it should go to Vista. The name is worth something since it used to be a great company to work for and to be a client of.”

From Oldtime Sunquest: “Re: Sunquest. Now the lab, rad, and pharm business can move forward and not back. Now the profits from lab can be reinvested in lab. The new owners know software and there is still a place for growth in the diagnostic software market. The software is still good, even though Misys tried to run it into the ground. It feels good to call them Sunquest once again. Sid must have a smile on his face today. I know the users and employees do. I agree that GE should look out.”

From Terence Hogan: “Re: Misys. Keith Hagen actually came from Sunquest first, then moved to Misys Transaction Services to be groomed for bigger and better things (like being CEO of QuadraMed, ha!) Lab and rad are good products, but weren’t selling well due to outdated technology. CPR was indeed hard to install and, although CPOE was very strong, the integration that was supposed to happen never really did.”

From Misys User: “Re: CPR. QuadraMed needs to get rid of the CPR Client Services management. The few users who attended the recent conference agreed that the last twelve months have been the worst in the history of the CPR product. We aren’t going to give QuadraMed as much time as Misys to make it work.”

From MrMisyster: “Re: Sunquest. There is very little question that the original Sunquest group in Tucson have reason for celebration today. Misys did nothing for them but take the profits and throw them away on a failing acute care business comprised of every lackluster product Tom Skelton could buy. The real question is who will lead this group since all executives are in Raleigh (Atkin?)  Also, what about infrastructure: marketing, HR, and a few others that all got compressed into the milieu that was Misys? What a six-year mess, but at least there’s some hope for the future of the Tucson group.”

From Enumerator_of_Beans: “Re: Misys. Looks like what’s left of Misys Healthcare is running about a 13% operating margin. Not the loss-maker some think, but hardly a punchy, software-type margin, either. For the $400 million, I would expect them to acquire an ASP-based physician product and save some cash for share buybacks to keep shareholders happy for the short term since the dispositions will negatively impact earnings unless they do something sensible with the proceeds.”

From Mia Hottie: “Re: Cerner. The iNet monitoring system that competes with Visicu is rumored to be at risk of being de-installed in a handful of hospitals.”

From Lane Kimchee: “Re: Google. Google announced a bunch of healthcare advisors, mostly big-name talking heads and luminaries, and not a single RN, much less anyone who’s ever actually taken care of a patient. Is there another industry where the #1 user group would be ignored? Google may just be another clueless big company trying to get into healthcare like those that failed before them: Amicore (IBM, Pfizer, and Microsoft), Dossia, and Cisco.”

I missed this: the interface engine part of Quovadx is bought by - who else? - a private equity firm. Cloverleaf will live on under the Quovadx company name, but the company will be moved to Dallas under new owners Battery Ventures, who also put their CEO at the helm.

If you had problems reading HIStalk on Monday or Tuesday, I’ll apologize yet again. I knew the server was going to get pounded when I noticed that over 100 readers were on during the early hours of both days (I can only see the first 100, so I only know it was some number bigger than that). It didn’t drop below for long on either day (mostly due to a crapload of stock analysts reading up, judging from incoming addresses). HIStalk was the only source of full coverage of both the Misys and Picis events (sleep-in reporters don’t like working Sunday afternoons and the wee hours of Tuesday morning like I did, even though I have another day job and they don’t).

Anyway, as Inga pointed out when I bemoaned possible site slowdowns, the user volume and feedback seem to indicate that HIStalk has become the primary source of industry news, both breaking and routine. For that, we say thanks. We really do work hard to get information, thoughtful opinion, and industry reaction in front of you. It’s easy for me to lose sight of that fact since all I see is a keyboard in an empty room for several hours a day, never talking to anyone about HIStalk or acknowledging that I’m behind it. I really appreciate the support of readers and sponsors. It wasn’t nearly as much fun with I had neither. As several folks have noticed, we’ll get our 1 millionth visit to HIStalk soon. Nobody wants HIMSS Hummers these days, so maybe I can get one cheap and give it away.

If you read HIStalk on the HIStalk2 site (with the pipe-smoking doc), you can click Archives at the top of the page to find your way around.

Cerner is speculated as a possible bidder for a big Australian hospital IT project.

HLTH Corp. (the stupid name WebMD chose voluntarily) and Emdeon Practice Services are suing nine insurance companies to force them to pay the estimated $58 million legal bills of their nine indicted former officers and directors. I bet it didn’t even cost that much to keep OJ golfing.

New CIO: Tom Pagano, Carondelet Health (MO), moving over from Truman Medical Centers. Boy, the paper really botched the name of the HIMSS chapter of which he was president.

HITSP seeks public opinion on its next recommendations to AHIC: emergency responder EHR specs, security and privacy, quality use case, and consumer information access case.

Discuss today’s news here: Misys, Picis, or even non-rhyming newsmakers.

Impress me with your knowledge or speculation: e-mail me or use the Rumor Report to your right to spill secrets or educated opinion. We like both.

Last week, Mr. HIStalk mentioned that Acermed was perhaps closing its doors. I was able to connect with Acermed’s Anoush Tabriz in Client Relations. While Tabriz wanted to make it clear that AcerMed is continuing to provide clients with support with their “skeletal staff,” the rest of our (short) conversation had several “no comments”. So officially no comment as to what is going on with the company, why the reduced staff, whether or not they are still selling new products, if the situation is temporary, etc.

Millennium Research Group announces results of a study that nearly 18% of physicians had an EMR in 2006 and the number is expected to rise to over 30% by 2011. System costs and the disruption of implementing a new process are the two biggest barriers today. To increase acceptance vendors are introducing more streamlined versions of their products. While these adoption numbers seem lower than some I have seen, I am inclined to believe they are fairly accurate.

Compare that to the recent AAFP survey that indicated that half of doctors that responded to a survey said they had either fully implemented an EMR (37%) or were in the process of implementing (13%). That suggests that either family practice docs are more advanced than other specialties, or, that the study was not as scientific as it could be (since it was based on respondents versus a random sample.)

Anyway, all interesting data points, but in 2005 some “experts” predicted that by now 24% of the docs would be using EMR. And about a year ago, the predictions suggested that by the end of 2007 25% of the 1-2 doctor groups would have EMR and as many as 78% in the larger practices. There are obviously varying interpretations of what it means to utilize an EMR and that likely lends to a wide range in the percentages. Bottom line – regardless of whose survey you look at, the market is still pretty unsaturated. Once there are more easy to use products and possibly hospital or government subsidies, the market will see some rapid growth.

eClinicalWorks was chosen by the DC Primary Care Assocociation (DCPCA) to provide EMR/PM solutions for their six community health centers. Four additional centers may be added in the future. No mention of the size fo the deal.

Not sure I have anything to add to all the comments regarding Misys. I actually have had fun reading what readers have had to say. Guess my only thought is that at one time Misys (at least the old Medic piece) was considered the Mercedes product in the industry. The good thing about an old Mercedes is that, even with age, they tend to still work. The problem with an old Mercedes is that there are a lot of other options that do the job as well or better and happen to be sexier and cheaper. I am sure that there are still a number of great employees left and I hope Misys will take care of them.

A MED3000 client forwarded us a letter that was apparently sent to all their clients. Chairman and CEO Pat Hampson announced the finalization of the InteGreat acquisition and the “vision” for how it was to become a “critical component” of MED3000’s and their clients’ success. There is acknowledgement that they are large users of multiple vendors’ software (Misys, GE, Sage, Allscripts, etc.) but Hampson point outs that they have “only limited influence over the direction of their software development.”  MED3000 plans to continue to expand development of IC-Chart and IC-MyHealthRecord. A cynic (like Mr. HIStalk) might suggest that clients watch out for a push to move everyone over to the InteGreat products.  However, if you take the four-page letter at face value, Hampson is trying to enforce the idea that they will continue serve the needs of their 9,500 physicians, including those on other systems, while at the same time channeling additional efforts to promote the InteGreat products. As Hampson rightly says, “the proof is in the pudding”.

Chat up Inga.

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High-acuity hospital information systems vendor Picis of Wakefield, MA will announce later today its intended acquisition of LYNX Medical Systems of Bellevue, WA, which markets revenue cycle management software and services for hospital emergency departments.

While terms were not disclosed, Picis President and CEO Todd Cozzens told HIStalk that Goldman, Sachs, & Co., advisor to Picis, will provide the company with a financial package worth $155 million. A portion of that investment will fund the Picis purchase of LYNX from its private equity firm owner, Francisco Partners.

Cozzens says the deal will combine the clinical expertise of Picis with the financial managment offerings of LYNX, both targeting the hospital emergency department. “LYNX Medical Systems focuses on revenue cycle management in the ED. It’s a huge revenue opportunity for hospitals. CMS [Centers for Medicare & Medicaid Services] rules in the ED are much different. There are so many areas in the food chain from patient encounter to patient disposition where charges can get lost or mis-coded. It’s a $25 to $35 per case improvement with this product, which will be even more when integrated with our clinical product.”

Picis offers perioperative and intensive care information systems in addition to its CareSuite ED PulseCheck emergency department information system, which it acquired from ibex Healthdata Systems, Inc. in August 2004. “It does for ED what we did for OR in putting anesthesia and clinical and administration together,” Cozzens told HIStalk. “We have a highly differentiated solution for these areas. It’s a big trend. It’s not good enough to just have clinical documentation and flowsheet information. You have to tie it to factors that are hard dollar, with a proven return that will stand up to scrutiny.”

The LYNX software suite includes ED and clinic modules for patient tracking, documentation, visit level assignment, and CPT and ICD-9 coding. Its health information management application provides browser-based electronic records management, remote access, and coding workflow.

“LYNX is software as a service,” Cozzens told HIStalk. “It’s a great per-click business model. The content and algorithms have been through CMS audits. If you over-code, it’s fraud, and if you under-code, it’s lost revenue. LYNX has been tried and tested with CMS. This is not software you can build in a day. It’s a great little company, a great little business, compatible with our clinical focus in ED. Picis will offer the first end-to-end solution for ED from clinicals to financials. LYNX sells to CFOs and has some great customers like Partners, Vanderbilt, Montefiore, Triad, and Yale-New Haven.”

According to Cozzens, LYNX is profitable, with revenue of over $30 million that has increased by 800% in the past four years. Its 200 employees serve 350 healthcare organizations representing over 15 million encounters. Additional LYNX offices are located in Waterloo, IA and Tampa, FL. No management or location changes are planned.

HIStalk asked Cozzens about integrating the product and company culture into Picis, which is located on the opposite coast. “We’ve been good at merging,” he told us. “It’s not like GE, where they don’t like domain experts and they bring in the plastic and lighting people. We love the domain experts and invest in them and, hopefully, they will multiply. We know this will be one of our easiest integrations. It’s easy to run companies in other locations if you have good management systems in place. Since I talked to you last, we’ve really beefed up our senior management team, people who know the enterprise software business. Big ERP went through what healthcare is going through 10 or 15 years ago. We’ve found that they’re invaluable in driving better practices and stronger management systems.”

The combined organization will service 1,350 hospitals in 19 countries, with reported annual revenues in the $125 million range.

Cozzens disclosed that Picis placed its initial public offering on hold three weeks ago so it could complete the LYNX acquisition, which had been in discussion since early spring. “It could not have happened with the IPO,” Cozzens told us. “We wanted to raise money to do this. The timing wouldn’t allow us to go out and then do the deal. There was too much space in between and it was time-sensitive. The company was going to be sold.”

Goldman’s investment eclipses the estimated $84 million the Picis IPO would have brought, Cozzens told HIStalk. “Private equity valuations aren’t too far off of public valuations. Our shareholders didn’t leave much on the table here.”

Picis will eventually continue with its IPO plans, Cozzens told us, but with the critical mass and momentum that the acquisition will provide. “We never viewed the public offering as a seminal event, just a financing event,” he said. “It was a no-brainer when we could arrange financing through strong terms, be a good deal for our shareholders and Goldman, and not be public at the same time. Critical mass will put the IPO at a different level at a higher market cap, with more analysts folowing and many different revenue streams.”

Goldman’s private equity financing makes it a major investor in Picis. According to Cozzens, the deal is Goldman’s first direct investment in healthcare IT and the largest healthcare deal in Massachusetts this year. “At $155 million, it’s nearly twice what we wanted in an IPO,” Cozzens said. “Goldman is an investor, very close to being the major shareholder.”

Goldman managing director Chris McFadden was quoted in a Picis press release. “The opportunity to invest in Picis is consistent with our long-standing desire to invest in companies with strong growth and earnings potential in healthcare. This investment underscores our belief that Picis has the strategy to meet this opportunity.”

The acquisition is expected to close later this summer.

Mr. HIStalk’s Cheap Seat, Hastily Thought Out Conclusions

• I like the deal. The only unknown is how much Picis paid. Goldman wouldn’t have put in its own money if it didn’t look good. It gives Picis a nearly unbeatable ED offering, something that no mainstream vendor can match.
• This must have been a complex set of three-way agreements to hammer out, especially with two of the parties being private equity firms.
• Picis is smartly sticking with areas in which the big boys are weak instead of trying to fight an expensive, ill-advised CPOE-and-orders ground war. Plus, revenue-related systems are back in vogue again after lots of money was wasted on unused CPOE applications.
• How did I miss LYNX? I’ve heard the name and mentioned them a few times, but really knew nothing about them.
• When Picis put its IPO on hold three weeks ago, I wrote: “Related to Picis (but written before the IPO news came out) is my editorial in this week’s Inside Healthcare Computing electronic update: ‘Private vs. Public Vendors: I’ll Take the Former,’ in which I argue that the now-trendy private equity investment is replacing IPOs as the primary way for companies to grow. I have to admit that I felt traitorous when I wrote it because Picis is my sponsor and my argument is that current customers historically have fared worse after a vendor goes public (my vendors, anyway) but now I can feel OK about it. I still have confidence in Picis and I bet there’s a positive reason they changed their IPO mind.” Score: Mr. HIStalk 1, lots of other pundits, 0. Lucky guess, I admit.
• Goldman Sachs, $155 million. Damn! No wonder Picis passed on the IPO for now. Why hamstring yourself with all the publicly traded drawbacks and expense when you can get liquidity and financing needs without opening your kimono to the world? Plus, that’s an impressive name to hang alongside your own.
• Assuming Picis sticks with Goldman for its eventual IPO, Goldman can’t weave itself too deeply into the Picis operations. While I’m sure they’ll be involved in strategic decisions, they can’t load up the Picis board and management ranks with insiders and then float the IPO.
• While Goldman will reap management fees and a cut of the profits, that at least that aligns their interests with those of Picis, i.e. they make money together or not at all.
• Francisco Partners flips LYNX after holding it for just 18 months. They just bought Dairyland Healthcare Solutions a few weeks ago, you may recall. The trend of private equity investments in the HIT industry is full steam ahead. It won’t end here, but the real question is how long those companies will sit patiently while waiting for a big payday. Will they buy and hold or slash and burn? It would be fun to know how much they made on LYNX (and how much of Goldman’s interest in Picis ownership hinged on that piece of the puzzle).
• Todd Cozzens is among the best businessmen in the industry, especially given his role as co-founder of a relatively small, privately held company. He just got a $155 million vote of confidence from the Cadillac of investment bankers and hasn’t even IPO’ed yet. Who would have guessed he’d be that much of a star after starting up a fairly unexciting niche vendor in 1994 and sticking around all these years?
• It was cool of Todd to contact me personally in advance of the announcement. I bet his marketing people thought he’d lost his mind in trusting an anonymous blogger with an embargoed story (meaning I was on the honor system not to run it before 12:01 a.m. on July 24). He also offered a potential follow-up to our interview awhile back, which I think you’d enjoy.

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