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Chatting with John Gomez 4/10/13

April 10, 2013 Interviews 25 Comments

John Gomez is CEO of JGo Labs.


What’s the big news these days?

It’s over. Epic wins. Not sure that is big news, more like the Emperor’s New Clothes from childhood. Everyone kind of knows they won, but no one wants to point it out.

Why do you think Epic has won?

As the data rolls in, some qualified and some conjecture, the one thing that seems to remain consistent is that Epic is the big winner when it comes to the EMR market. This may seem rather obvious, but for some reason we keep hearing how there is still tremendous opportunity in the EMR market.

I am not sure where that huge opportunity lies or what market is being referenced by the Epic competitors, but from what I see, if we are discussing the hospital market, then Epic has won the lion’s share. Congratulations go to Judy and team. Job well done.

I am often asked by analysts if Epic is the big winner, who is the runner up? My vote would be Cerner. I actually am rather impressed by the company’s turnaround, KLAS scores, and general ability to deliver a quality product at a competitive price point with solid periphery services.

That brings us to the rest of the pack — Allscripts, GE, McKesson, and the niche players trying to carve out a place among the smaller hospitals that haven’t made an EMR partner choice. Mind you that even in the small hospital market of 50 to 150 beds, Epic is making inroads, with CPSI doing a great job of gaining ground. There are some other players, but in my eyes, these are the companies to watch.

What happens now?

Mind you I am often wrong about these things, but there are basically two things that will happen. The first is that we will see continued focus by hospitals to optimize their financials for the new world order. Secondly, we will see a resetting of the landscape.

 

Where do you think the market is in terms of our maturity?

If we went back to the 80s and 90s, we would find ourselves surrounded by plethora of word processing and spreadsheet offerings. Anyone remember WordPerfect, Multimate, Wang, and Write? How about Quattro Pro and QuickCalc? Today the office productivity market is owned by Microsoft, with some pressure from Google and Open Office, but nothing even remotely close to threatening Microsoft Office’s market share. We have seen the same thing occur with databases (Access, dBase, Clipper, Sybase, IBM-DBM, Gupta) and even accounting packages (JD Edwards, AccPac, etc.) I suspect we are in the early stages of consolidation where we will see some of the EMR market begin to shift and clients moving over time to the market leaders.

 

Why don’t you think that hospitals will move now instead of saying with their incumbent EHR vendor?

The thing to understand about this market is that for all intents and purposes, it is a very conservative market. I suspect that hospitals don’t just jump ship overnight because there is vast fear of the unknown. By that, I mean there is just enough FUD — fear, uncertainty and doubt — that hospitals stay put. 

I do believe that if there was a very prescriptive means of migrating, hospitals would move, but today there is no clear methodology that shows a hospital exactly how to move, the risks, the plan. and how to be successful in that migration. If someone brought to market a clear migration methodology that was highly prescriptive, I suspect they would be very successful and hospitals would certainly make the move.

 

We hear a lot about cloud computing, open platforms, and SaaS. Will they allow new companies to emerge and challenge the current market leaders?

I hear that a lot. I have investors who try to convince me that an EMR that is cloud based or has a great new user interface or some new single platform solution is going to make everyone suddenly abandon their EMR of choice and jump ship. I just don’t see that happening.

This market is very loyal and is not enticed by the great new shiny object. Clients in this market move because a vendor just cannot keep its promises and does not follow through. This market is not driven by small savings in costs or the promises of being open. I do think being open is important, but I don’t know of any hospital that is going to move because there is suddenly a new platform.

 

Many people say Epic is closed.

That is pretty funny. Since leaving Allscripts, I have had the chance to really get to know Epic. I have found that Epic is actually very open and has a flexible platform. They have programs to work with third parties and there are many, many third parties that integrate with Epic.

Much of what you hear about Epic is myth. Much of it is created by their competitors, which is rather telling if your only way to combat Epic is to spread myth.

 

Give me an example of Epic’s openness.

Actually I can give a bunch of them. For one, they were one of the first vendors to integrate with the DoD and VA seamlessly. That is significant because most of the HIE standards in the country are based on the DoD/VA work. Epic is the leader in this space and what’s more, they use this to help all of their clients exchange data. I don’t know if they did this by design or by accident, but either way the outcome is brilliant.

In terms of third-party integration, they seem to be very open to that in my eyes. A good friend of mine, Matt Sappern the CEO of Perigen, reached out to Epic and asked about how they might be able to integrate. Epic was responsive, and in a few short weeks they had an agreement in place. Perigen, to the best of my knowledge, is now extremely excited and an Epic supporter.

Contrast that to some of the other vendors, even ones with app stores, and you find that it is extremely difficult to put a deal in place and takes weeks and weeks if not months. Epic suddenly starts looking like the nicest company on the planet to work with.

 

How will the market change?

Over the past several years, what we have seen is inorganic growth in the market. Companies, especially the EMR vendors, really needed to just do what the government required, deliver on their promises, and follow through to be assured of growth. Not to minimize it, but that is what Epic did and does and what Cerner did and does. The companies that had failed leadership, lost their way, or focused on financials rather then quality … well, they kind of didn’t enjoy that growth.

As things settle down, we are going to see a shift from inorganic growth to organic growth. Organic growth is where you must rely on your own innovation and understanding of the market to gain share or preserve share. You need to figure it out and no one, not the Government or anyone else, is going to provide you a checklist, like Meaningful Use.

That shift from inorganic to organic will reset the market. It means everyone — Epic, Cerner, McKesson, Allscripts — all have a chance now to either win or lose. The key will be figuring out what they need to do to take advantage of this reset. It will be easiest for those who own the most market share, but it is not guaranteed. Just because you won the EMR battle doesn’t mean you won the war.

 

Where do you see the opportunities?

I think that in terms of opportunity there are two categories. The first being add-on opportunities and the second being apple seed opportunities. Add-on are those opportunities where a vendor can bring to market new offerings that they bolt on or integrate with their EMR. The second and most critical to long-term success are apple seed opportunities. These are new offerings that provide new market growth, for example, entering adjacent markets or inventing entirely new products.

 

Simplify that statement.

I would steal a line from my friend Matt that I mentioned earlier. The go-forward victors will be “those companies that can help hospitals make money or avoid penalties.” I think that regardless of whether we are talking about add-on or apple seed opportunities, the net net is that the clients in this market are going to need to really to focus on optimizing operations. That will drive much of the investment they make in the coming three to five years.

 

What does Allscripts have to do fix itself?

That answer would make an interview in and of itself. In hopes of not boring your readers, I will keep it short.

The bottom line is that they need to decide what they are. Are they a software company or sales company? To date, they have operated as a sales company. Even when I was there I fought that persona and always felt it was one of the biggest issues we had. They have a long way to go to become a software company.

I also think they need to figure out who is really conducting the orchestra. They have lots of people suited up for opening night, but in my eyes it seems there is no conductor. I am sure they are working hard to get things right, but just seems like they need to get one person who can articulate end to end how it all works, when and how it is all going to come together, and where it is going in the future. In a manner that is clear, market relevant, and based on facts.

I still have a huge soft spot for my former team members and feel bad for them. They have been working day-in and day-out on something they truly believe in, yet time and time again the leadership of the company has let them down.

When I talk to analysts, they focus on 5-10 percent growth models. All they care about is how the company just grows 5-10 percent. This is one case where Wall Street is just as guilty in holding this company back by forcing them to focus on financials rather then building a great set of solutions. 

Going private isn’t the answer. That is just leadership weakness looking for a scapegoat. Cerner turned themselves around a few years ago, as did many other public companies.

The market is going to reset. It is all a matter of if this company takes advantage of that. So far I just don’t see much difference today than anything the previous seven or eight CEOs have done or tried.

 

What are the biggest market fallacies or myths?

I covered one, that Epic isn’t open. Some of the others are related to what I consider emerging trends. I think there are a lot of buzzwords being thrown around that, as they often do sound great but aren’t actually more than buzz.

Things like population management, clinical trials integration, and outcomes management are catchy, but when you get past all the buzz, they seem to be solutions looking for problems. I would really caution vendors and providers to think very carefully before investing in these areas. I would especially advise providers to see if they can’t solve these issues with the tools they have, inexpensively, before they pull the trigger and buy more technology.

Lastly, I am thinking mobility. Provider mobility, except in some limited areas like wound care for instance, just isn’t there yet and is not going to be the big paradigm shift. It will happen, but probably not as fast as the buzz indicates. I do think on the patient side mobility is huge and growing rapidly with great returns.

 

What would be some strategies you would recommend hospitals consider over the next few years?

I think that first and foremost, forego best of breed for tight integration. Features can be evolved and hospitals can easily push a vendor to fix the gaps.

On the other hand, integration — regardless of Meaningful Use 3 — is really really hard to get right. Despite vendor best intentions, it’s not going to happen overnight. In the future, I suspect you can live with a small feature gap, but as you need to rely more and more on a holistic view of the patient, you will find that integration is mission critical.

I would also tell hospitals that they need to stop paying premiums for software. This industry is one of the few left where you have pricing models that really make no sense. How does bed count or total caregivers change the value of the software? It doesn’t.

If you want to find an easy means to optimize costs, push vendors to realign their prices and charge intelligently. I think it is cool that market economics allow for $20M software deals, but going forward, clients need to set ceilings and really question the pricing.

Hospitals also need to truly examine the value of the shiny object. Do they need that population management thing? Are they really going to need to integrate with clinical trials? Do they need a huge data warehouse? Maybe, but chances are most hospitals do not. Question the shiny object and invest in practical solutions that drive real revenue and reduce exposure to penalties.

I would tell them to reconsider their departmental systems. I think there are really great new offerings out there that can help drive down costs, improve throughput, and make a difference to the bottom line of the hospital. I also would tell them to look into outsourcing things like their pharmacy and ICU. For smaller hospitals, this can be a serious way to reduce costs, improve quality of service, and drive margin improvement.

I would suggest they consider embracing self-care systems and introduce more case management that is subsidized by their majority payor. That is a little harder to explain here, but basically it is about reducing admissions for non-critical patients and still generating revenue.

Lastly, I would tell them to work really hard at being a business. I know that isn’t politically correct, but I think that focusing on being a business actually would improve revenue, which is ultimately required to make investments in improving patient care.

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Currently there are "25 comments" on this Article:

  1. It’s *inconceivable* that you continue to give this blowhard that has accomplished very little aside from self-promotion a voice on your highly respected industry blog. Tell us why we should listen to anything he says – where’s his credibility? Nice that he distances himself from the failures he *led* while at both Eclipsys and Allscripts.

  2. I’ve felt for some time that the EMR arms race is over. It may not be a single vendor like Epic at the end of the day but 2 or 3. As a tier 2 vendor, I don’t have the exposure that John has but you can sense it from talking to hospitals. It is a sea change. They are tired of having the burden of gluing together a hundred different vendors to serve their patients. I can’t blame them but do blame the other tier 1 vendors that sucked vast amounts of money from hospitals for years and didn’t provide comprehensive functionality. This cake was baked long ago with Healthcare “reform”. It forced hospital CIOs to mitigate risks and go with the vendor that was most likely to survive and provide one-stop-shop functionality, peer pressure and ridiculous costs aside. The disappointing part is that this will likely shut down innovation as Epic and Cerner both have tight account control and their consultants continue to tell their clients they can do anything. See SAP.

  3. Really John,

    After all these years pretending to know something at Eclipsys and Allscripts, and sucking up so much stock / options from shareholders, you have the nerves to pretend you know anything about Epic and the market.

    How is JoGo Labs going? Looking for Epic Work???

    Shame on you HISTalk for promoting such fraund. Since when has John Gomez become the voice of reason?

  4. I somewhat agree with John’s statement about Epic “winning.” Epic has clearly put itself out front and is doing a lot of things right. Epic is, like he said, actually pretty open to outside systems (so long as they follow the Epic rules). However, it’s always tough to look at someone as credible when they continually state market leaders and leave out MEDITECH.

  5. Shame on HISTalk for giving John Gomez any level of self-promotion. He did nothing at Eclipsys – even on 2 tours of duty! What makes him credible? Is he running a hospital today? Is he a clinician? Is he a nurse? CFO? …none of the above! I’m always happy to use the ‘delete’ key every time I see or read anything from John Gomez. You should take heed and follow this ‘best practice’ the next time he comes calling to promote himself!!

  6. Since when did JG become the voice of the industry. He failed at Eclipsys/Allscripts and has not delivered anything of note to the industry.. Of course Epic won – it does not take a genius to figure that out. They are still winning although they do force customers to follow their very narrow path.

  7. I had to laugh when I read JG’s comments, especially the one where he says that people attack Epic by spreading myth considering for several years I sat through meetings with this guy and all he did was attack Epic. I worked as part of his team for his 2 stints at Eclipsys/Allscripts and I can tell you that there was never a happier day for the vast majority of his dev shop as the day he finally left for good. He talks a good talk but when it came to actually delivering anything, he and his golden boys delivered nothing beyond telling his “team” that we were lucky to have jobs and work with such a visionary as himself.

  8. It’s good to hear from John, even if he sounds a bit like a paid Judy promotion these days. I think he has some credibility, at least as evidenced by the emotional cries for his beheading above.

    While it may be true that he didn’t get it right, I was one of his believers in taking the Objects Plus product forward as Helios and using it to integrate new products and applications into the Allscripts platform. I think Allscripts saw it primarily as a tool to integrate their own disparate products and fell on the rocks of product schizophrenia, effectively taking neither path with sufficient commitment to successful completion.

    But that is water under the bridge, and it seems as though Betamax won this time, at least for now. I like the comparisons to office software and can see a similar dynamic in the EHR industry as a possibility. There are other options though and hubris has brought down many an empire, so I’m not counting out some quantum disruptive technical or business process change (I think EPIC kind of drives regulatory change these days so I wouldn’t look for it there.)

    I still work with Sunrise and think it’s a solid product, well-positioned for the future. I don’t see it going anywhere anytime soon, but thanks for an entertaining morning, HISTalk!

  9. I worked with John at my only stint at Eclipsys. Although he was full of himself there, he at least had some clue about what he was doing. John is not an expert in this space and should not be given a platform to speak anymore. His reckless comments are really starting to give HISTalk a bad name. I work for an HIE vendor that also provides realtime analytics. I vist large practices and hospitals and the comments about Epic is it is a closed system. Even hospitals that have drunk the Kool Aide recognizes this strategy. Just ask an affiliate physician if he can share his data between his referring hospital. Unless that referring physician rips and replaces with Epic Ambulatory, there is no way to bidirectional pass CCDs that can then be parsed into the descrete EHR that affiliate is using.

    John before HISTalk gives another platform which I hope never happens again. Get your facts straight. Talk to all the vendors that have tried to work with Epic. Talk to Epic users. You really missed the boat on this one.

  10. Having Gomez write for HISTalk is like inviting Alberto Gonzales (another now-unemployable hack) to write for a legal journal!

  11. Thank you for the JG Interview. Several of my former colleagues have gotten together by phone and email this morning to parse JG’s wisdom and compare it with our mutually experienced realities while at Eclipsys/Allscripts. As a group, we’re seriously impressed and entertained with JG’s new awesomeness, and we wish him well in Verona.

  12. Agreed,

    There is nothing worse than an Healthcare executive that belives his own BS. It seems as though Healthcare is running rampant with know-it-alls nowadays. Its funny how people lay claims to how great an application is when they never even used it. Lets see John admit, transfer and discharge a patient in Epic!?

  13. If you let this guy speak his mind again I will forever block HIS Talk from all of my work PCs.

    John, has shown poor leadership at every place he has stopped, followed by bashing his former employers. Looks like kissing up to Epic is his market strategy these days.

    Mr. H, you made us read his comments, pls do not delete mine.

  14. Rarely have I seen such a uniformly negative raft of responses to a HIStalk interview. John Gomez, it seems you’ve created some rancid karma. Better get to cleanin’ that up!

  15. @ ErinsDad. Seriously? You and 3 other people took time to conference call each other to discuss how great John is? I’d hate to be your employer.

    I know approx 10 ppl who worked with John or managed him–to summarize their words, “good riddance”. Epic you can have him–kiss of death.

  16. I’m puzzled – JGo pushes integration (a useful position), but then says to look at departmental systems. This is inconsistent. Are you pushing a fully integrated solution, or a group of best-of-breed solutions?

    I have a hard time listening to JGo slam his former employers, when he created a significant amount of the problem. He presented to customers, prospects and analysts that he would deliver fully integrated solutions using Helios in a matter of months. He either knew this was impossible, or he’s completely incompetent. In either case, that makes him someone who doesn’t deserve a soap box to lecture from.

  17. I’m guessing one of the most fascinating parts of Mr. HISTALK’s job is to see the IP address of the folks who leave comments. A nice new feature would be a heat map of where a particular article is popular 🙂

  18. Lincoln, you seem to think that JG had some good ideas, and I suppose that may be true.

    I have good ideas too. Here’s one: I have an idea for a flying car that runs on atmospheric CO2, produces exhaust of O2 + diamonds, and also produces, at no cost, a delicious dish of ice cream: your choice of flavors.

    Similar to JG, I can’t get my idea to work. When do I get to write a column?

  19. My experience with HISTalk is that it is pretty democratic in terms of who writes columns, I’d advise JBen to go ahead and write a column, submit it, and then see if there is still room to complain. I look forward to hearing more of JBen’s good ideas.

    Sorry not to join in and be a part of the lynch mob, I just tend to think we’re all doing the best we can in a difficult and often technologically fast-moving and uncomfortable marketplace. I tend to have ‘smaller’ ideas and they sometimes help keep me out of trouble, but even unrealized ideas are often better than no ideas.

    I’m not necessarily defending Mr. Gomez but I will freely attest that he doesn’t owe me any money.

  20. when the soviet union collapsed some one wrote a book called the end of history.. that prognostication was completely inaccurate.. I seem to recall the world was supposed to end in December of last year we’re still here (at least for the time being)…. Mr. Gomez is entitled to his opinion..but that is all it is.

  21. Either John Gomez and Mr Histalk are the same person, or they’ve both gone off the deep end. There has to be a threshold of what gets published. I’ve been an avid reader for 4 years, and I’m disgusted beyond belief. Everyone is entitled to their opinion, but posting this in an interview format is just sad

  22. 20 plus readers have had strong emotional reactions. If you take the emotion out of the equation, and you take the history out as well, is what Gomez saying accurate or no? If “John Doe” wrote this, what would the comments be? I honestly do not know, but I’d be interested in others perspectives.

  23. This guy showed his lacked up ‘depth’ very early on in this supposed interview. The fact that he states “I am not sure where that huge opportunity lies or what market is being referenced…..” is positive proof that this man has no vision and has/had no business running a company. I am HUGE fan of Epic and I do agree that they are winners. But there will be many winners and the ‘opportunities’ he fiercely admits he doesn’t see are abound and being seeded by the ecosystem being created by Epic and the rest of the market. Hey John, why don’t you chop down all those trees so you can see the forest! Jeez!

  24. Fun job – Since most of the posters have either identified themselves as former employees, co-workers or customers, I am not sure Mr. HISTalk has to invest time in producing the heat mapping just yet.

    TruthSeeker – Track record aside, Mr Gomez has offered up a mix of the obvious, the overstated and the counterintuitive that when read in whole leaves one with the impression he is “kind of” paying attention to our industry. In truth, without Gomez’s track record, most readers would have just skipped to the next article somewhere in the middle of the 2nd paragraph – but such is the price of trying to be a rock star when you talk better than you sing.







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Reader Comments

  • C'mon Man: Jon literally blamed their earnings miss on having one fewer day in the quarter. This isn't exactly something that sneak...
  • Classic Jonathan: Dissing on Epic to dismiss athena's failures. If your fundamental premise in business is that every one of your compe...
  • meltoots: Anyone else think that it screams excessive for athenahealth to OWN a Challenger 300 private plane? EHR vendors have a n...
  • HHC...: Not that this should come as a surprise, but the amount of corruption and “side deals” involved with the HHC Epic im...
  • HIT Girl: That's quite a bloodbath....

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