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March 18, 2008 News 8 Comments

From Joe Bob: “Re: consultants working on percentage of savings. I find it not only deplorable, but outright thievery and total ignorance. Children’s Hospital National Medical Center is an example. They were a top pediatrics hospital, then a new CEO hired consultants based on percentage of savings. The hospital is out of top 20. P.S. Hasn’t everyone had enough of HIMSS and their organization, or is it just me?”

From The PACS Designer: “Re: One Portal. TPD mentioned the concept of looking at personal health information in the same light as a personal online banking account. Now it comes to light that Denmark has had an online health portal for recording your health history called One Portal since 2003. It could be used as a model for other countries to emulate and get the PHR/EMR process started as an online solution.” Link.

From Niven David: “Re: economic concerns. I would have to imagine many vendors and hospitals are seeing an impact from current economic concerns, with sales slowing and hospitals tightening the purse strings. Any comments or perspectives?”

From Reggie: “Re: Allscripts. There is a rumor that McConnell quit the Allscripts board in disgust at what he felt was a low-ball offer.” It must sting. Allscripts, Glen Tullman, and John McConnell were on top of the world and McConnell’s former company Misys was on the ropes. Suddenly, one bad earnings report sends MDRX stock reeling from the high 20s to below $10, allowing Misys to gain control on the cheap. What could be lower on the HIT totem pole than having Misys as your new daddy? I bet Glen Tullman won’t like reporting to the board-controlling Brits very much. Can two struggling companies combine to make one good one while maintaining their traditionally high prices, complex technologies, and indifferent customer bases, not to mention keeping their antsy shareholders happy as the inevitable product and people consolidations occur? In this market, with nimble competitors nipping at their heels, and with the current economy, let’s just say they’ve got plenty of work to do. I expected a much better outcome for Allscripts. Mothers, don’t let your children grow up to be publicly traded.

Update: John McConnell did resign in protest from the Allscripts board Monday night. See the comment I posted at the end of this article.

From Reggie: “Re: Allscripts. There is a meeting in New York tomorrow where both Misys and Allscripts management teams will answer analyst questions. I am not clear on whether this was an emergency meeting designed to convince obviously skeptical Allscripts shareholders that this is a good deal. On paper, this is a $13 deal, which is why Tullman described it as a ‘big premium.’  Since the stock closed at $9.75, the market has priced in $3.25 worth of doubt about the combined entity’s prospects. Clearly what Allscripts needed was the help of a big operator like GE, Perot, CERN, or EDS. Were any of these companies interested?” Surely others peeked up their skirt and passed before Misys got a turn, although the overused prospect of synergy has led to many a troubled marriage.

From the conference call announcing Allscripts-Misys Healthcare Solutions, Inc. (boy, talk about an uninspiring first decision – that name reeks, at least when it’s not screaming “YOU give up your name – we’re not budging on ours.”) Sounds like some products will not be developed further (the first step to sunsetting, of course). Synergies are predicted. They like the idea of selling into the minimally EMR’ed Misys customer base (which Inga suspects means that Misys EMR and A4’s EMR are goners – they can’t walk in the prospect’s door waving competing systems). They talked about merging a year ago, but Allscripts was too expensive (the stock market took care of that little problem). I heard the two companies huddled hard for days right before HIMSS, which I assume means they desperately wanted to make the announcement there.

Someone sent me the communication sent from Misys to customers. Other than the sudden love between two formerly bitter competitors, the most interesting point was the standard boilerplate, “connect all stakeholders through the continuum of care.” Wasn’t the utterly failed Connect strategy of Misys supposed to do that? And do stakeholders, in the form of customers anyway, really care about connecting to the rest of the continuum of care? Only if you’re trying to sell to hospitals and their affiliated practices, which the new, badly named company will try to do.

Lost in the shuffle: Misys PayerPath and Home Care. They probably should deal off the latter to Sunquest or somebody, but PayerPath has promise with a bigger sales footprint (unless they sell it off for cash to QuadraMed or McKesson, which wouldn’t surprise me since it isn’t even being mentioned in all the pleasantries).

HIStalk ran plenty of speculation from readers that the Misys-Allscripts deal would happen. I admit that I was skeptical, but I said all along that bringing in ValueAct Capital was a sign that Misys wanted to shed its healthcare lines. All of you who called the shot early – nice going. Nobody else was even talking about it until it ran here. Even the high-powered analysts at the HIStalk HIMSS event were buzzing a little because I’d mentioned it the night before, plus HIStalk readers had just voted Allscripts “most likely to be acquired.” Smart readers. I didn’t mention it, but the Allscripts PR person tried to get me to kill the HISsies because Allscripts didn’t want to be named as an acquisition target. For good reason, as it turns out.

Connectologist (you know him) posted a very nice writeup in HIStalk Discussion about medical device connectivity. This stood out: “A perfect day for an IT person is to fix every problem that comes up from their desk, monitoring systems, rebooting servers, documenting support, etc. A perfect day for a biomed is to go to the point of care and work one on one with clinicians solving problems with training, problem diagnosis, and repairs. This is part of the ‘great divide’ between biomeds and IT.” Worth a read.  

Thanks to the 134 of you who responded to my consultant survey. Great information. I’ve e-mailed out the results to those who participated and supplied an e-mail address. A reader already contacted me and said the results were helpful in making a career decision, so he or she appreciates it. Also, thanks if you completed my reader survey, which I’ve now closed. I saw some very nice comments there, so I’ll have more about that once I’ve digested your thoughts.

Fair Warning did a webcast last week on EMR privacy and compliance challenges, including HIPAA enforcement. John Wade was one of the presenters and over 400 folks tuned in. It’s archived for playback.

Jobs: Manager of Lab and Pharmacy IT, Clinical Information Systems Analyst, Manager of Clinical Support Systems. That first listing had an ingenious leadoff: “If you attended the HISTALK party at HIMSS, you know that the ‘most significant IT sale of 2007’ was the Epic contract with Cedars Sinai. I guess that would make these the ‘most significant HCIT job opportunities of 2008’. Read on.”

Medical device data integrator iSirona gets a $1 million private placement. Joining its board are industry long-timers Carl Witonsky and Jim Hall.

Ohio State and Wake Forest Baptist choose the ClairVia staffing system from AtStaff.

Little doubt about it: the iPhone will be big in healthcare.

Thailand medical tourism hospital Bumrungrad International, birthplace of what’s now called Microsoft Amalga, installs the first robotic drug management system in Asia, going with Swisslog. The hospital’s CEO, Mack Banner, appears to be an American from his educational background, which I didn’t realize.

The Australian Medical Council will move its Visual Basic systems to the web-based Ruby on Rails platform.

Merge Healthcare delays yet another SEC filing, this time its annual report. I swear its accountant must be a moonlighting shoe salesman from the local H&R Block.

Holy Cross Hospital (FL) chooses the E/Point ED charging application from LYNX Medical Systems (aka Picis).

Two doctors who were sued for $67 million by John Ritter’s family are acquitted. The family already received $14 million in settlements from other clinicians and a hospital. I don’t mean to speak ill of the dead, but I never found his mugging, camera-aware style anything more than annoying, but to each his own. It’s still a shame, of course. Maybe he really would have made another $67 million in future earnings like the suit claimed. Your Honor, I call Adam Sandler to the stand.

What else could they mess up? Haywood Regional Medical Center (NC) fires a nurse and former Army lieutenant colonel for giving state inspectors information about hospital medical errors committed there, saying the Army taught her to discuss and fix problems, not hide them. She’s suing. So is another former hospital employee turned whistleblower who was canned for giving CMS information about medication errors (CMS agreed and stopped reimbursement to the hospital). The loss of 68% of the hospital’s revenue led to the resignation of the hospital’s CEO, board chair, HR director, and nursing VP. Now the hospital is fighting the press to keep the former CEO’s compensation private despite its being public record. The board is thinking about selling the facility. Good idea.

E-mail me.


Inga’s Update

DR Systems announces nine new contracts for Unity RIS/PACS worth more than $3.8 million.

Thomson Healthcare releases its 15th annual 100 Top Hospitals. To come up with the winners, Thomson analyzes data from Medicare Provider Analysis and Review data for 2005 and 2006 and Medicare cost reports for 2006 and evaluates hospitals on eight measures of clinical quality, operating efficiency and financial performance.

Does anyone care to explain this MedCom Soft press release for me? Is there: 1) no real message at all; 2) an announcement they want to increase US marketing efforts; or 3) a well-hidden announcement about “right-sizing” the organization?

Walgreens announces its new Health and Wellness division that will manage its health centers and pharmacies located at large-company work sites. They are also buying a couple of companies providing work site health centers, raising their total number of work site and retail health clinics to 500. Walgreens estimates the potential for onsite work site clinics will grow to 7,600 corporate campuses with at least 1,000 employees each.

One of our fun sponsors asked Mr. H and me to participate in a NCAA basketball pool (I am not naming them in case the IRS reads this blog, even though they claim winnings go to charity). I was hum-ho on the whole thing until I read this section of the memo sent to all employees: “This year, we have added a Group Message Board option, which is a convenient outlet for those of you who may want to elaborate on their respective bracket picking strategies, defend seemingly half-witted picks, talk smack, or just have daily alternative to your Mr. HISTalk addiction.” I may have to participate to ensure folks don’t inappropriately make basketball more important than HIT gossip. Since I like winning and don’t really consider asking for advice equates to cheating, feel free to send me your best picks.

From Insider Outsider: “In regards to your note about Bill Gates appearing before the US House Committee on Science and Technology, and his predictions, my only response is …yawn. Bill G. has never been one to have very good or accurate predictions. He is usually very general – ‘technology will get smaller and faster’ (duh) or he is very wrong ‘within 5 years, all computers will use voice commands and the mouse will disappear’. Billy G. predicted that spam would be solved in 2 years (still waiting), that OS/2 would be the most important operating system of all time, that no one would ever need more than 640k of memory, etc. Yeah, he’s gotten some right, but even a broken clock is right twice a day. He made his fortune by buying someone else’s technology and reselling it. He’s the used car dealer of technology. As for the future, his best picture of the future is to look at what Steve Jobs is doing and to copy that.” Yeah, but he’s rich. Doesn’t that count for something?

My favorite part of the interview with eClinicalWorks Girish Kumar Navani was is brief commentary on various vendors. You have to be pretty confident to swagger the way he did.

Thanks for all the Linked-in invitations. (Do people like Linked-in and other network sites because it makes them believe they are popular – or at least have friends?) Regardless, it helps me with my swagger.

E-mail Inga.

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Currently there are "8 comments" on this Article:

  1. Re : TPD and Denmark portal : I suggest TPD to get educated on all the virtual EMR intiatives across Europe – the smaller countries leading the pack :

    https://www.nictiz.nl/ ( button for English ) ; overview for The Netherlands

    -http://www.ehealtheurope.net/ ; overview Euroland

  2. John McConnell, a key player in developing two companies that were sold to Misys Health Systems and Allscripts to form their current product lines, has resigned in protest from the Allscripts board of directors over the merger of the companies, according to the Raleigh, NC News & Observer.

    http://www.newsobserver.com/business/story/1005330.html

    McConnell told the newspaper that he resigned Monday evening because the merger was unnecessary and job cuts would result.

    “I think both companies are weaker today,” said McConnell, who said he thinks Allscripts was already on pace to be a dominant company. “I think it’s going to be a big challenge merging the two businesses. And I personally hate to see all the jobs that will be eliminated. The company talks about all the synergy savings. Wall Street calls it synergy. I call them people.”

    McConnell sold Medic Computer to Misys PLC and A4 Health Systems to Allscripts.

    In related news, Credit Suisse downgraded shares of MIsys PLC this morning, saying that Misys was the more profitable company and that its $330 million payment for 54.5% of the new entity is too much given the potential synergies.

  3. RE: Allscripts-Misys, what happens to Allscripts’ medication repackaging business? For months, I’ve heard rumors that it’s up for sale, but that no one wants to buy the business because all you’d end up buying is a customer list. This business unit brings in something like $44 million of annual revenue. They don’t usually discuss it with investors, but it’s a big part of their total annual revenue.

    The repackaging business can be very profitable, but Allscripts’ enjoyed incredibly low margins. If they keep that business, I’m not sure how they’ll achieve the margin improvements forecasted on yesterday morning’s call.

    Thoughts?

  4. Re: Dutch Treat. Thanks for the input on European EMR activity which will enhance TPD’s knowledge base. While EMR activity is broad-based across the world there are many ways to improve the application further and what better way than to focus on the patient by helping each patient create their own personal health record or PHR through an online application. In an emergency situation, it would be to the patient’s advantage to have PHR that a responder can access to get vital information on a patient’s history. A combination of the PHR and EMR would be the ultimate goal for a patient centric application.

  5. Willy, Willy, Willy. First I am hoping you were typing on a PDA because if you are talking about joining Misys the first thing you need to do is spell the name right. Second, I hope you are not leaving a job where you are making a strong, steady income because there is a bunch of uncertainty at Misys right now. There is a reason there are open sales positions (not to mention sales reps and others looking for jobs.) I would ask what happened to the person you are replacing and if he/she hadn’t made his numbers, ask why. Ask what percentage of reps that have your same role throughout the company are on target for the year. And especially ask what products you are expected to sell long term. My bet is that being a sales rep at Misys/Allscripts is not going to be easy in the short term because clients and prospects are scared to make decisions about products that may or may not be the ones surviving long term. Sure, they will tell you the products will be “supported” but that also means you may have some unhappy clients in your territory if they have products that are not going to be continually developed. Then again, if you are just starting out in sales, why not go for it? Get a good solid base and hopefully you can learn the ropes and find a better job in a year.

  6. Hi

    Anybody know if ‘the companies formerly known as’ Misys/Allscripts might be trying to coax McD back?

    What on earth do Misys’ customers think of Allscripts products?







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