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Monday Morning Update 3/30/09

March 28, 2009 News 17 Comments

mptFrom Anon: "Re: McKesson. Layoffs Friday, specifically in Provider Technologies. About 120 employees." I heard that from a couple of people, one of whom put the number at 400-500, but saw no announcement.

From SpeedD: "Re: Meditech. I have heard a rumor that Meditech is allowing employees to buy stock this year." I e-mailed the press contact for confirmation, but haven’t received a response.

From The PACS Designer: "Re: Windows 7. InformationWeek has an excellent video on the key features of the upcoming release of Windows 7, which is expected to happen in late September. TPD likes the DirectAccess, AppLocker, and the  Branch Caching feature in this new enterprise software application. Another nice feature is when you are on the Internet, you are automatically connected to the enterprise server, so you have the same application look that you would have at your employer’s headquarters." Link.

From Bobby Orr: "Re: APACHE. Cerner did buy that and Project Impact and tried to combine them into a Web-based tool called Critical Outcomes (or something along those lines). Don’t know of anyone using the new tool but it seems like everyone still running some version of APACHE."

From Gene D’Machine: "Re: IBM’s healthcare practice. Half of them laid off, I hear." I heard that, too. IBM certainly seems to be doing all it can to alienate providers right as it tries to get business from them.

Chicago weather: 1-2 inches of snow Sunday (I’m writing this Saturday) and a high of 50 this weekend for HIMSS. Not exactly San Diego, is it? The coat check girls will make a fortune.


Speaking of Chicago, the Tribune covers the business affairs of new White House healthcare czar Nancy-Ann DeParle: she made at least $3.5 million over two years from fees and stock gains, the White House won’t allow her to be interviewed and wouldn’t answer questions about her business history, and neither she nor the White House have released any financial disclosures.

I’ve been to busy to make any kind of HIMSS plan, so I figured I would try the MyHIMSS09 Calendar. The idea is pretty cool: each session has a link to click to add it to your calendar. What I didn’t like: the calendar itself takes up a ton of Web page and there’s no print function, so it will be a bulky set of Web page prints (not a real calendar, just a list of sessions). You can send individual sessions to Outlook, but not the whole set (and not to Gmail). And, every time I tried to remove a session, it locked up my PC with a monstrous CPU utilization from Firefox Javascript, so I’ve got stuff on there to cross off. The session search/browse was also a bit clunky, not allowing searching by session number, by CEU offered, or by presenter (that I could find, anyway). I’m sure I will end up marking on the little pocket version that I hope they haven’t eliminated.


Trey Lauderdale of Voalte, Inc. has arranged an informal NCAA viewing party after the HIStalk HIMSS event Monday evening at Theory sports bar, 9 W. Hubbard St. (a couple of blocks from the Trump). If you’re still hungry, they serve upscale barbeque and Mexican and they’ve got $5 burgers on Monday, which beats the heck out of Sysco prisoner food at the convention center or the usual room service blandwiches that leave you stuffed but unsatisfied. I think Trey is buying the beer. If Theory fills up, he’s got some backup bars next door.

EHR Scope has a new spring edition ready for download. It has several articles on EHR selection and implementation.


Thanks much to new HIStalk Platinum Sponsor Cumberland Consulting Group of Brentwood, TN, which has grown to over 50 employees in its six-year existence. It’s a 2008 Music City Future 50 winner and a Consulting Magazine 2008 Best Small Firm to Work For winner. I like this statement: "Reflecting on their Big 4 consulting background, Cumberland’s founding partners were struck by the waste of talent that occurred because of competing priorities and big company bureaucracy." What they do: IT planning, systems selection, implementation, PM, and IT improvement, and just about everything EMR related. I checked the HIMSS directory and it looks like managing partner Jim Lewis will be holding down the fort at Booth 4475, so please let stop by and them you that you appreciate their support of HIStalk like I do.

Speaking of HIMSS, our annual guide to what HIStalk’s sponsors are doing there will be ready for your online reading and downloading shortly. Please show those folks a little booth-visiting love in your exhibit hall travels. Their support of HIStalk and its readers is entirely voluntary and self-initiated: they e-mail for information, I e-mail it to them, and sometimes they e-mail back that they’re in (and many times, don’t). Inga and I don’t advertise, solicit, take calls, provide fancy statistics, reveal our identities or location, or otherwise hand-hold prospective sponsors (I just don’t have the time, working full time in a hospital, and I figure it’s pretty clear what we do here). You can see how cool they are by keeping an eye out for "We Power HIStalk" signs in the HIMSS exhibit hall and stopping by for a howdy. I’ll be doing that myself (incognito, of course).

Everybody likes to speculate who Oracle will buy next, apparently unfazed by the historical 99% rate of being wildly wrong. With a Red Hat rumor in the air, one research firm takes some swags that include Allscripts and Cerner in healthcare. At least the addition of Allscripts is new.

Olympus Medical Center (WA) gets approval for a $2 million GE Centricity practice EMR purchase. This board member must know hospital IT: "There are going to be changes. I just feel them. And I think all of them are going to cost money."

Hospital layoffs: Regional Medical Center at Memphis (TN), 86; Immanuel St. Joseph’s (MN), 100; Jackson Hughston memorial Hospital (AL), 70-80; Barton Healthcare(CA), 43.

Jobs: NextMD Template Designer/Developer, VP of Human Resources, Cerner CPOE Activation Support, Regional Sales Director.

The Orange County Business Journal profiles Sheldon Razin, founder and chairman of Quality Systems Inc. (the NextGen people), saying he took $2,000 of his own money and created a company now worth $1.4 billion. I should have bought shares: they’re up 2,000% since 2000 and even up 10% so far this year.

New on HIStech Report: our interview with Gary Zegiestowsky, CEO of Informatics Corporation of America, which has commercialized Vanderbilt-developed clinical technology that, in Gary’s words, "leverages data across clinical settings and aids decision-making and improved patient outcomes."

Interesting: WSJ covers "brain gyms," where members "work out" with mental fitness software. Scientific evidence is lacking, but previous research found that the brain can rewire itself with new neural connections in response to mental activity, such as cognitive training. Sounds like a good business to get in on early.

Emageon announces that the company has settled what it says is a meritless lawsuit against its acquisition by AMICAS. It also reports that revenue was down 34% in 2008, with net losses of over $42 million.


I saw Dennis Quaid in a very confusing and awful movie called Vantage Point last week. He had a strange expression throughout, looking crinkle-nosed like he had just gotten a whiff of some foul odor (I think that was his effort to convey discipline and focus). Not even close to his excellent Right Stuff performance. Perhaps he’ll show clips at HIMSS.

Odd lawsuit: a teenager having her tonsils removed in 2006 falls as nurses tried to help her sit up on the OR table. She claims headaches and files suit (three years later) for $8,000 in medical expenses and $992,000 for suffering, future medical expenses, and disability. Who wants to be a millionaire?

E-mail me.

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Currently there are "17 comments" on this Article:

  1. Re: IBM’s layoff in healthcare consulting (Global Business Services, Public Sector). I’ve seen about 40-ish names and I know several of them were actively engaged on client projects (don’t you know the client loves that!). I would guesstimate that of the 650-ish folks Healthlink rolled into IBM in ’05, there are <100 now. I’m very curious to follow what work IBM wants to do re: the stimulus package and who they’ll have doing the work. Probably long-time IBM’ers who have never done real work inside a healthcare setting.

  2. the MyHIMSS09 Calendar – Yep. I couldn’t have said it better. I experienced all the same frustrations you did and was especially disappointed that I can’t print my schedule, which probably means I won’t stick to it. Or maybe, if it’s a slow week, I’ll cut and paste into my groupwise (ugh!) calendar and print from there. Yeah, right.
    I would’ve expected something better from an organization focused on information technology. Oh well.
    I’m looking forward to the conference anyway.

  3. The Koppel-Kreda article in JAMA is getting a lot of press…with docs from throughout the nation screaming: Yes, Yes, Yes….I’ve lived with this for years. These vendor contracts prevent us from telling the truth and from fixing EMR errors. But AMIA bigwigs are attacking — seeking to protect vendors. This is an old debate within AMIA: Do with represent the vendors or the clinicians and patients? Apparently, AMIA is siding with the vendors. Once again, they are seeking to protect their economic base at the expense of principles. When will they learn?

  4. IBM paid over 600 mil for the company. That came to around 1 mil per emp. All that experience was worth it. With only 100 emp left its now 60mil per emp.

  5. Reliable sources – people laid off at McKesson, say the number was around 400. Heavy hitters – leading spokesperson for Revenue Cycle for McKesson was laid off. Odd; especially since they are making progress with their new product designed to replace the sunset STAR, Series and HealthQuest product lines.

  6. Re Chicago weather and DeParle – winter wonderland outside, but since we’re headed for the 50s will be long gone when you arrive. But please bring your coats, the tips will help more than you know. As for DeParle, in Chicago-speak, we don’t want nobody that nobody sent is morphed by the Washington inner circle to we don’t want nobody that nobody hooked up.

  7. Layoffs at McKesson – a Tier 1 company, serving the healthcare providers, is worrying. It points to a lack of credibility about the stimulus package helping the healthcare at all.

  8. The most successful implementations occurred at systems that had 2 qualities.

    1) they trained in-house staff to do the implementation (you can teach a school teacher or a medical assistant to support and train go-life and pay them about $50,000 a year or $25 an hour ) and didn’t need very expensive out-side consultants. (cost $75 yo $100 an hour)

    2)they also were closed loop systems (kaiser and group health for example) where the savings were part of the operations vs going out the door to the insurance companies.

    So it makes sense that the consulting firms would need to down-size. They should focus on organizational change and process improvements over project based implementations and bring that expertise to the table. Not paying people $75 and hour to stand by and tell someplace where to click.

  9. he Koppel-Kreda article in JAMA is getting a lot of press…with docs from throughout the nation screaming: Yes, Yes, Yes….I’ve lived with this for years. These vendor contracts prevent us from telling the truth and from fixing EMR errors. But AMIA bigwigs are attacking — seeking to protect vendors. This is an old debate within AMIA: Do with represent the vendors or the clinicians and patients? Apparently, AMIA is siding with the vendors. Once again, they are seeking to protect their economic base at the expense of principles. When will they learn?

    Can you point me to the action? I can’t find much via Google News.

  10. RE: McKesson layoffs – While 400 might seem like a high number to most, from my sources, a lot of the layoffs were due to the reorg (mentioned a few days ago by Mr. HISTalk from an email snippet someone sent him) and normal attrition. There have been no mentions of economic struggles as McKesson from their last reports is very cash heavy for a company of its size. Also, I believe 400 laid off is about 2% of total employees which falls well in the “attrition” area.

  11. As to comment on Friday that Dr. Rob Kolodner, current director of ONC would “will cash in on his ONCHIT stint by taking a high-level, mostly ceremonial vendor or lobbying job instead of heading back to the VA ” I couldn’t disagree more and anyone who knows him would never find the suggestion insulting.

    Why would Rob change his values and character overnight. He spent his entire public career trying to “make a difference” Whatever he does certainly won’t be ceremonial and is unlikely to have anything to do with lobbying. I would vote that he will help implement the strategic plan that is driving this process and then retire at some point. His depth of knowledge has tremendous value but I doubt it is something he would withhold from the common good by becoming a high priced consultant. We all do owe him a huge dept of gratitude however and he should be compensated for his service but he will continue to make genuine contributions to the industry versus playing the lobbying game.

    I am a “lowly” consumer advocate who makes a living implementing EMR’s who occasionally tries to bring that voice forward. I served on both the governance committee for the AHIC Successor and on the selection committee for the Board of Directors – for the NeHC and got to know him (so it is easy to figure out who I am). The night before they announced David Blumenthall would be going to ONC Rob called me peronsally to confirm the rumor and assure me that the grass-roots would continue to be heard. That takes class and a real commitment to empowering patients and providers.

    Remember he spent most of his career at the VA where they have the only working national health information system in the country. His team at ONC (only about 6 people) built the foundation that made it possible for the stimulus package to include billions for health information technology and I doubt that over-night a public servant with his commitment and values to actually solving problems would do anything that wasn’t congruent with his beliefs.

  12. re. MEDITECH stock

    Actually, the big rumor is that MEDITECH is NOT allowing employees to buy stock this year. A big deal, because the stock purchase plan is a big part of the compensation there.

  13. MEDITECH has always allowed its staff to buy stock.

    Three requirements:

    1) Three complete calendar years of employment must be served
    2) There is a set limit tied to the number of shares someone can purchase based on a formula that most likely mixes in several factors such as your earnings, tenure and position in the company.
    3) The option to buy is only available to those who qualify for a short window of time during the early part of each calendar year.

    I’ve not heard that there is any change to this long-standing practice this year.

  14. I have received my shareholder documents in the mail in advance of the annual MEDITECH shareholder meeting to be held on 4/24/09.

    According to the public 10k filing with the SEC, in January of 2009, MEDITECH’s board of directors approved the issuance of up to 225,000 shares of stock to its staff at the price of $37/share.

    Of course approving “up to” that number doesn’t mean that number will actually be made available or specify to which staff members they will be made available to.

    In 2008 MEDITECH made just 206,155 shares available for purchase to “certain” staff members. So the number of shares for sale is actually up from a year ago. It’s just a question of who those “certain” staff members who can purchase them are.

    Over the past two years 50,000 shares were purchased by Neil, Howard and two additional company officers. If they did the same in 2009, that would leave 175,000 shares available for purchase by others.

    If the additional 11 company officers and members of the board each were to purchase the same minimum listed by other officers in the past year, that would be seven more individual purchases of 5,000 shares, or another 35,000 shares added to the 50,000 already accounted for.

    That would reduce the net total of shares for sale to “other staff” to just 140,000 . That would amount to just over 50 shares per staff member (based on the over 2,700 employees at MEDITECH according to their website).

    At $37/share that would amount to an investment of just $1850 per employee.

    But who will those shares be sold to? Who will be the “selected” staff members?

    The previous comment indicating that no shares are being made available to staff for purchase is close to the truth when compared to past history, but it is clear that slightly more shares will be offered for sale, just to far fewer staff members.

    According to sources, a statement has been issued by Neil to the company as to why shares are not going to be generally offered to qualifying staff as has been the case in years past. The rationale is linked to the current economic climate. But is that really the truth?

    Could it be that even though the board has approved more shares for sale to staff in 2009 than were purchased by “certain staff” in 2008 (206,155 shares), that the shares approved for sale in 2009 will only be available to an even more select sub-set of staff?

    If this is true, what does this mean? Are certain individuals in the company being positioned for an impending windfall? It’s clear that Perot Systems really wants to buy MEDITECH. They’re already marketing their new hosted MEDITECH solution “MSite” (http://www.perotsystems.com/meditech/Technology/ManagedServices/MSiteMEDITECHHostingSolution).

    In addition, MEDITECH has recently announced that they are “partnering”” with Perot to help customers realize the maximum benefit from the The American Recovery and Reinvestment Act (ARRA). (http://www.meditech.com/AboutMeditech/pages/newsarraannouncement.htm)

    Could it be that the seemingly inevitable acquisition of MEDITECH by Perot is right around the corner? Given the fact that Perot’s Healthcare business unit
    has been ranked #1 in the 2008 Top 20 Best in KLAS Awards report in the
    category of ‘Clinical Implementation – Principal’. This award from the KLAS
    organization represents the second such honor for Perot Systems in 2008.

    In March of 2008, Perot Systems received the #1 performance ranking in a KLAS report examining professional services firms that provide clinical
    implementation services.

    Let’s face it, Perot has the horsepower to deploy systems, software and services on a scale that MEDITECH can’t come close to on their own.

    Besides, who wants the headaches of implementing and then servicing all of these customer in a capacity that far exceeds any demands ever placed on MEDITECH in the past.

    If I were to prognosticate, I could see Perot purchasing the operations components of MEDITECH (Sales, Implementation and Service) and leaving MEDITECH some autonomy as a technology development partner.

    Nobody has a crystal ball, but if I had to predict the future without one, that’s how I would put all of these pieces together.

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