As a guy who has worked for two of the largest Healthcare IT companies in sales & consulting…I can safely weigh in on this discussion.

Most have a model where you price by the Operating Expense of the facility. If it’s a multi-facility sale, then you add up the OE’s. Now clients who have a small OE, pay less than the full price, the majority in the middle pay at or a little above full…and the huge health networks usually always pay double-triple the price for all of their facilities added up (there is a cap and usually these networks go WAY above this cap number). This all correlates with users in a roundabout but acceptable way.

The other model most commonly used is number of LICENSED beds (not just used beds). Both of these models are used primarily with the largest IT vendors who sell the big multi-software sales of EMRs and specialty integrated software packages.

3rd party software resell is done usually on a per-user basis.

The old fashioned (very nice but usually very expensive) client server systems require an upfront investment, plus an annual license fee. Sometimes this fee includes service and support, and sometimes it does not. In a few cases, there is no license fee, but the user must pay for upgrades (or new versions) of the software.

The newer ASP (web-based) systems almost never require an upfront fee and almost always charge a per-user subscription fee. In most cases, this is a monthly fee per physician user (medical assistants and other allied health professionals usually receive free access to the system), although some vendors charge an annual subscription fee. In most cases, software upgrades and basic service/support are included in the subscription fee, although on-site training is usually extra. Over the long haul of 5 or more years, ASP systems are not cheaper than client server systems, and are sometimes more expensive, although many physicians cannot afford to invest $50,000 – $250,000 for an expensive client server system.

Recently, EMR companies (especially the web-based vendors) have started offering free access to their EMR and practice management software systems if the physician uses their billing services, and the vendor withholds a percentage (4 – 8 %) of collected revenue in exchange for their services.

I hope this is helpful.

EMR Software Guy,

http://electronic-medical-record.blogspot.com

If the