Reed Liggin is president and CEO of RazorInsights of Kennesaw, GA.
We named our company from the principle of Occam’s Razor, which says the best explanation is usually the simplest one. Our tag line is “Simplified Healthcare Technology.” Our goal was to build an electronic health record initially that was easy to use, simple to learn, and something that you would purchase from the company that would be easy to do business with and simple to do business with.
We offer the solution on cloud technology. It’s software as a service. It’s a single integrated database on a multi-tenant cloud. We call our solution One simply because it’s on a single database.
As for my background, I’m a pharmacist by trade and have been in health IT since around 1997. I formed the company with two colleagues that I worked with in the past, Edward Nall and Michael McKenzie.
I don’t even remember the last time somebody wrote a new full-hospital system from scratch. Why haven’t they done that, and why is RazorInsights doing that now?
[laughs] Well, I think we’re just crazy enough to give it a try. It’s really a big challenge and a daunting task.
Our initial roadmap was the EHR Meaningful use criteria that were released in 2010 along with the pharmacy system. We felt that medication management was the core of a good clinical system. We started there, and we’ve evolved into a full enterprise HIS as a response to market conditions and the opportunity that’s been presented to us.
Do you think your product is competitive with systems like Meditech and CPSI that have been around for decades?
We do. I think I would be disingenuous to say that we have every single bell and whistle and the breadth of functionality that companies have been the space for a really long time do. But I think we do a really good job of focusing on the really critical 30 or 40 percent of things that hospitals need the most and make sure we do those really well.
Then we are on a long-term mission to, every day, expand our functionality to cover all the pieces of functionality that hospitals need out of an enterprise hospital information system. But I will say that I think we are very competitive across the board as far as feature functionality goes. The depth of our functionality in quite a few areas like CPOE and pharmacy is very strong, but obviously we still are a work in progress.
Is it difficult to convince a customer that it’s in their best interest to have a limited but deep set of features?
We have to find the right customer that shares our vision. As we started the company two years ago, we have taken a deliberate pace to not try to sell every single deal we could possibly sell. We had to be sure that our product was ready to go to the market on a large scale.
We try to be fairly selective in choosing the right hospitals who share our vision and understand that there’s an evolution here and the end result will occur in a very short amount of time. The end result will also be that they’ll have a solution that can be achieved from going with a different company.
I assume that your primary customers are going to be smaller hospitals. Is that a limiting factor because that’s as big as an enterprise you can serve or just because they’re easiest to sell to at this point?
It’s a little of both. Certainly you want to start where there’s an opportunity. We saw an opportunity in the smaller hospitals — under 100 beds — because those hospitals typically had older technology for the most part. As we started to serve those hospitals, we have had opportunities to sell to larger hospitals, but most of the time they’re not ready to go into a situation where they’re going to have to do without certain functionality for a period of time.
You start with the opportunity that’s the biggest where you can serve the needs. We expect to evolve to be able to serve larger hospitals, but one of the things we wanted to do as a company was not try to do too much too fast. We want to be careful, because the worst thing you can do is try to outsell your capabilities, whether that’s to too many hospitals too fast or whether that’s to larger hospitals that you can’t accommodate. We want to be sure we got this right as we go along.
A lot of folks would say that part of Epic’s success is because they qualified their customers as much as their customers qualified them. Is it difficult as a small company to not pursue sales that you probably could make?
I don’t know if we’ve been as selective as Epic. We had an opportunity that was presented to us with the stimulus to get in the game, so to speak. We didn’t really get that selective, but we targeted hospitals that we knew would be a good fit for what we’re trying to do and found hospitals that had management teams or executives who shared the vision we were creating.
The challenge for us has been, if you grow at a more deliberate pace, obviously there’s market pressures based on the window of opportunity you see that there’s always pressure to move faster, to get bigger faster, to move to bigger hospitals faster, to sign more hospitals faster. We always have that pressure to move faster because the window of opportunity won’t be there forever. We want to be sure that we capitalize on the opportunity that’s before us, but at the same time not put ourselves in a position where we can’t deliver.
My sense is the market wants competition instead of just Epic, Cerner, or Meditech and some of your competitors in the smaller hospital market. Do you feel the pressure to be something that you’d rather not be in serving those larger hospitals that don’t have a lot of choices?
I think there’s a tremendous amount of pressure from larger hospitals and medium-sized hospitals that are looking for another choice. They want us to get there faster than is probably possible. We just try to get up and get better every day. That’s our motto — every day we just try to improve upon what we’re doing and grow as fast as we can.
That being said, we built our ONC-certified Complete Inpatient EHR from the day we started coding it to the day we were certified in about 100 days. We built a full, enterprise HIS within two years. We have some breadth of functionality still to cover in that product, but for the most part, we can service a small hospital very well. We’ve done it faster than most other companies have done it. I think that works in our favor.
What’s the secret? Nobody else has been able to figure out how to do that.
What we know needs to be done, a lot of people know. I’m a little surprised sometimes not more people have tried it. I think probably because it’s a capital-intensive effort that’s held a lot of people back.
We were just a group of people who had worked in the trenches at various health IT companies, at hospitals as healthcare workers, and really had a clear vision of exactly what we wanted the product to do and what we wanted it to be. We wanted it to be something that was easy to use, easy to learn, a modern look and feel.
We use a rich Internet application called Adobe Flex for our graphic user interface. We were looking for that new modern user experience in a system that would be easy to adapt.
On the services side, we also wanted to focus on being transparent with our customers, keeping our pricing simple. We have a bundled pricing model that’s all inclusive. You don’t get a contract with two pages of line items of different third-party software that’s included in the product. We try to be very straightforward.
Also, we actually do the build for our clients. When we go into a hospital to do an implementation, we’re gathering information from the hospital, and then we do the build process and then bring the product back and train the client on it.
It’s a different approach, and I think there’s other companies that have done different elements of that. I don’t know if there’s a lot of secrets there. There are a few. One is the way we develop. We have a pretty unique development process which takes a lot of industry subject matter expertise combined with some very fast coding talent to develop the product almost around the clock. We’re able to produce new code pretty quickly.
Are those technical resources employees or are they contracted?
Some of both.
It seems like it would have taken a lot of cash for some guys who used to work for vendors to put together.
[laughs] We bootstrapped it pretty much to date. We are in the final stages of completing a private equity deal. We’ll be announcing that within the next couple of weeks. That will give us the capital to take the company to a whole other level and put our foot on the accelerator when it comes to building out this enterprise vision.
What can you share in terms of company size?
We’re still pretty small. We have 55 team members. That’s the team that services, develops the product, and everything. We have clients mostly in the Southeast, but we’ve expanded to some states west of the Mississippi and in the Midwest also.
What’s your pitch when you get in front of these small hospitals and maybe they’ve never heard of you? How do you sell them on the idea of doing business with you?
First and foremost, we’re all about being a single database, integrated product. Today we bring a single database integrated financial and clinical system to the market. By spring, we’ll be releasing our ambulatory product, which will include an electronic health record and practice management system for physician practices on that same single database.
The other thing that we’ve done, as we started to develop the system, we looked at hospital systems and how they evolved. They evolved departmentally, where there were pharmacy systems and lab systems and nursing systems and CPOE systems, etc. What we looked at was, how can we really make this a more efficient, improved approach?
We decided to knock the walls down between the departments in the hospital. We’ve created what we call a non-modular solution. Each user has access to the system based on the privileges they have according to their role, but every user has the same access into the system and a similar look and feel and view.
We call that view of the patient record our holistic patient record. If I’m a pharmacist, in a lot of systems, I can only see what’s going on with the patient’s medications and maybe some lab results. I can’t necessarily see the surgical procedures or radiology tests they’ve had unless I go to a different module in the system. In our system, in the holistic patient record, I’m able to see all of that information and have a complete picture of what’s going on with the patient right there in one view no matter what role I have, as long as I’m supposed to have access to that information.
Are your revenue components fully developed even though your emphasis seems to be on clinicals?
We started out as an inpatient electronic health record vendor. We began building out the entire clinical suite. As we got into the market, hospitals were rapidly adopting EHRs for the stimulus opportunity.
About a year into it, hospitals started to pretty much demand that they would select a new vendor based upon them having an entire HIS. The market really changed a lot more quickly than we expected. We did expect a system replacement market to occur, where old technology would be replaced by newer cloud technology in the next few years, but the shift happened a lot more quickly than we expected.
We either had to acquire or partner within a revenue cycle system or we had to build it. We opted to build it. There’s still work to do and we’ve got most of the pieces built. We can operate a hospital. There’s a few things we still will build out, but in a couple of instances we used partners to help supplement what we don’t have at this point.
Since you and your colleagues worked for a variety of vendors, what mistakes do you think you’ll be able to avoid having that experience?
I think staying true to the vision as a single integrated database is important. While you may not necessarily want to build every piece of software that a hospital would ever use, you need to have a clear vision as to what’s a core component of that single integrated database solution and stay true to that.
Additionally, I think reliability is a big factor – becoming a company that is known for reliable installs, reliable support, somebody that is a partner the hospital can count on. Obviously our friends at the big ship in Wisconsin have done a great job of that.
You mentioned your VC investment that’s upcoming. A lot of companies stumble at that point because the VC wants to take it in a different direction, at a faster speed, or with different people running the show. Do you see that vision holding true with the influence of the outside money you’re going to take in?
Yes, we do. It’s an interesting process and the first time I‘ve been through this process to seek capital for a company. I spent about a year looking for the right partner. I went from Silicon Valley to New York and everywhere in between meeting with venture capital and private equity firms. Usually within the first 10 minutes, you could tell in the conversation if they understood what you were trying to do and understood your vision.
We were just absolutely committed to the fact that we were going to find a partner who understood what we were trying to do and understood our vision. We turned a few offers down and finally found what we think is the ideal partner. They share the vision, they understand exactly what we’re trying to do, they have a really in-depth knowledge of the space. We think we’ve pretty much found our dream partner.
How do you see the next five years playing out for the company and for the industry?
Wow, that’s a big question. The next five years for the company, we’ll continue to grow our market share in the small hospital space. I think we’ll evaluate whether we want to move upstream to bigger hospitals and how quickly. At some point, we’ll start to execute on moving into that space, where we think there’s potentially a lot of opportunity in addition to the small hospitals.
Additionally, we may look at some international opportunities. We’ve been investigating a few recently. If they make sense and are not outside of our core focus, we may pursue some of those. I think we’re in the beginning of a real shift for a lot of HIS system replacements to take place over the next few years. We just want to make sure that we capitalize on being a part of that opportunity.
For the industry in general, I think you’ll see obviously a lot of smaller hospitals moving to cloud or hosted solutions as that becomes a more practical way for them to manage a system without a lot of IT resources on staff.
You’ll see IDNs continue to consolidate smaller hospitals into their organizations. We’ll continue to see the trend of physician practices becoming part of hospitals and IDNs and becoming employees. It will be interesting to see what happens in our space with some of the larger ambulatory EHR vendors as hospitals acquire those physician practices. They may start to encroach on their market share by pushing hospital systems out to those physicians, so I think there’s an interesting dynamic that will come along with the consolidation. And then, finally, I think it’s still to be determined what impact ACOs will have in our industry, but there will be some impact. It’s going to be interesting to see how that plays with what’s going on in HIT.