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August 6, 2015 News 11 Comments

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IBM will acquire Merge Healthcare for $1 billion, giving IBM’s Watson product “eyes” that will allow users to compare images within a single patient or across similar patients for diagnosis and treatment. IBM will pay $7.13 per MRGE share, a 32 percent premium to Wednesday’s closing price. Merge shares haven’t hit that price since late 2006, having dropped 58 percent in the past 10 years as the Nasdaq rose 135 percent.

Reader Comments





From Helen Waters: “Re: MEDITECH’s financial report. To reference a famous quote: ‘The reports of my death have been greatly exaggerated.’ (Mark Twain, 1897). MEDITECH is ushering in a long overdue level of energy and meaningful innovation to the EHR market. Our customers, and the EHR industry, should expect more. We are delivering disruptive innovation with fiscal responsibility, which we believe the industry very much needs. No other company is better positioned to deliver an advanced and contemporary EHR solution that addresses the needs of the market at an affordable price point. We are doing that. Let’s stop assuming that if you pay more, you get more. To what degree has that premise really been vetted? The EHR vendor community needs to work harder for your health care IT dollar. As healthcare leaders, you owe it to your organization, and as vendors, we owe it in partnership with the national agenda. We are all being called upon to drive down the cost of delivering efficient and effective quality healthcare, as well as to spend the healthcare dollar more wisely, and this includes information technology. We are fortunate to have a big seat at the EHR table, and we intend to preserve and grow it. While you note a change in our revenue and earnings, given these transformative efforts, this was not unexpected. Please know we are responsibly at the table, and we are committed to our existing customer base, providing them with an affordable option to migrate to our latest platform. We celebrate the success of our customer base and the impact they’ve had advancing the delivery of high quality healthcare for the communities they serve. At times, the EHR market feels a bit irrational relative to IT decisions and the promise of utopia often being trumpeted with selecting one system over another. We are proud of our past, executing in the present, and delivering for the future of healthcare technology.” Helen is VP of sales and marketing for Meditech and references my mention of the numbers above from its Q2 report.

From DoD: “Re: DoD contract. The actual amount Cerner got is very small and will need to be shared with Intermountain. I suspect we’ll see a tremendous amount of infighting in this group as they begin the work of delivering while not being paid until the users come online as the contract requires. That stretches payments over seven years, but the investment needs to be done up front. There are several off ramps built in and some strict deliveries. The prime will have to beat the subs into submission in order to deliver on the commitments while withholding payments for years.” Unverified. I’m not sure what Intermountain contributed to the bid or what they’ll get in return.

From Doogie: “Re: Epic. In light of news of Epic’s failures in the UK, coupled with DoD decision, Epic should probably start worrying about its public image. Judy’s silence may have worked for her in the past, but now that Epic is finally being held accountable for its shortcomings, people are going to start wondering if there’s nothing to hide why not comment? One thing is certain, Epic’s stubborn refusal to join CommonWell, among many other things, may finally be backfiring.”

From Concerned Reader: “Re: HIStalk. You’re a Cerner hater and an Epic lover. I have decided to stop reading HIStalk because your bias affects your reporting to the extent of being unethical journalism. On Monday the morning update headlined Cerner missing financial projections in the first line and Epic’s loss of the UK hospital as the very last line.” One thing I’ve learned in writing HIStalk for 12 years is that I can’t mention Epic, religion, or George Bush in any capacity without having a few hysterical, anonymous readers react like a bull instinctively charging a red cape. It doesn’t matter what I actually say — just seeing the words on the page sends a few grudge-bearing readers off screaming with fingers in ears. Lt. Dan writes the headlines and wisely chose Cerner’s earnings report (along with those of Allscripts and Meditech) as the top headline  – Cerner’s report and comments were more important given their DoD win and continued integration of Siemens Health Services. If you’re truly going to stop reading HIStalk (those who threaten almost never do), consider first Googling to see which of the cookie cutter, opinion-free alternatives covered Epic’s reported loss at Papworth – I don’t see even one, which means your only source of that negative Epic news was right here on good old unethical and Epic-loving HIStalk.

From Out of Touch: “Re: KLAS. Using ‘fighting words’ and posturing as they holding vendors hostage on a topic KLAS clearly doesn’t understand. Irrelevant. For a price, I bet.” KLAS says many large vendors “challenged KLAS to step up and be the Switzerland of interoperability,” an assignment it accepted “with trepidation” in offering to convene a meeting along with CHIME. It adds that, “Congress and federal agencies are likely to cheer when they know such action is voluntarily taken” and lists as participants CEOs of Allscripts, Cerner, Epic, Athenahealth, Meditech, and others. I’m not sure I would expect KLAS to be the Switzerland of anything or to lead the interoperability charge while selling non-interoperable vendors reports as its main focus, but we’ll see what the participants come up with.


From Mute Pointer: “Re: BJC. Says their downtime wasn’t due to a hack.” MP forwarded an internal email describing the results of BJC’s investigation, which concluded that “inadvertent actions within our own IS department” flooded the network and caused its protection systems to restrict application access. They’ve hired an external consulting firm to review their IT infrastructure, having not done one since 2013.


From Isadore Nobb: “Re: AHA Solutions. I don’t think any product has failed to earn their ‘vetting’ approval as long as the company paid. With one contract at least, they added a huge group of solutions from a business unit without any process other than to require another million dollars and a percentage of sales. Turns your ethical stomach.” Unverified.

HIStalk Announcements and Requests


I took a deep breath of hesitation before clicking the button to upgrade my primary PC to Windows 10. It was painless and has been perfect so far, with zero learning curve, no unexpected gotchas, and no incompatible programs. The only extra step for me was to install a new Win10-compatible version of Bitdefender Total Security 2015 and the upgrade even prompted me to do that automatically. Win10 has a good user interface and just feels right all around. Here’s what I’ve discovered so far with a small amount of use:

  • The Cortana “ask me anything” digital assistant box is useful, even if only to avoid navigating trying to find commonly used functions like Device Manager.
  • The Start Menu is not only back, it has been enhanced to display some of the Metro live tiles by default (but that can be turned off, too).
  • The Edge browser replacement for Internet Explorer feels really fast and lightweight – it brings up the HIStalk page faster than Firefox by my timing.
  • Task View does something with virtual desktops that would seem to be useful, although I haven’t done anything with it.
  • The Action Center icon rides in the system tray and offers one-click access to some settings and a log of recent system activity. The much-hated “hover to see the charms” option is gone.
  • I haven’t studied it in depth, but looking at Task Manager’s CPU and disk utilization, Win10 seems to be much more efficient. My CPU usage always seemed to be high under Win8, but it’s at 1 percent right now and so is disk utilization. I don’t know what actually changed, but everything feels snappier.

So far, I would say this is the best and easiest Windows upgrade ever. That only negative I’ve read is that some basic and not universally used features (being able to play DVDs, for example, or play ad-free Solitaire) have been removed from the basic free upgrade and are now paid options in the previously little-used Microsoft Store, raising the possibility that Microsoft plans to give away the basic OS (to previous consumer-only licensees, of course – businesses and new users still pay) and charge more for optional individual apps and services in a cafeteria-style promotion. In that regard, Microsoft may have moved Windows into the ultimate machine for generating recurring revenue instead of a one-and-done upgrade.

My server took a temporary break when I sent out the email blast about the IBM-Merge deal Thursday, just like it did last week on DoD news, which I thought was a one-time overload of readers. The result was a “you’re going to need a bigger boat” maxing out of server memory to the point it couldn’t even swap out storage even though I’m running a dedicated server with a Xeon E3 four-core processor, 16GB of memory, and solid-state disk. I’ve placed an order to upgrade the server yet again, a problem I’ll happily accept every time since it means someone is reading other than me.

My present grammar gripe, which isn’t really a gripe since it’s cutely old school: referring to a “piece of software” as though the user gets just one slice of the larger software pie.

This week on HIStalk Practice: Dr. Gregg composes a moving requiem for the patient portal. AncestryHealth Chief Health Officer Cathy Petti discusses company plans to move member health histories into EHRs. Practice Fusion ramps up executive team in preparation for IPO. WEDI survey confirms what other ICD-10 research has already shown: Physician practices aren’t ready for October 1. AMA lobbying dollars come under scrutiny. Azalea Health secures a new round of financing. Premier Physician Network goes live on Centricity. The newly formed Ohio Independent Collaborative looks to extend the livelihoods of independent physicians.

This week on HIStalk Connect: Yelp expands its consumer review platform to include Medicare performance data for hospitals, dialysis clinics, and nursing homes. The FDA issues a safety alert over cybersecurity vulnerabilities found within Hospira infusion pumps. Developers in South Korea introduce a new Braille-based smartwatch for the visually impaired. A new startup focused on women’s health unveils an earbud that tracks basal body temperature during sleep, plotting it on a paired smartphone app.


None scheduled in the next two weeks. Previous webinars are on the YouTube channel. Contact Lorre for webinar services including discounts for signing up by Labor Day.

Acquisitions, Funding, Business, and Stock


Computer cart maker Capsa Solutions acquires Rubbermaid Healthcare., which offers basically the same product line.


Marlin Equity Partners will acquire ambulatory EHR/PM vendor AdvancedMD. ADP bought the company in early 2011. Marlin also owns e-MDs and MDeverywhere.


Health Catalyst acquires Health Care DataWorks, the early but lagging data warehouse vendor that was spun off from Ohio State with former CIO Herb Smaltz in 2008.


India-based Cognizant reports a 39 percent increase in its healthcare business is it continues to boost revenue and profits following its September 2014 acquisition of TriZetto for $2.7 billion.Health makes up 29 percent of the company’s business. Share price rose 50 percent in the past year, valuing the company at $41 billion.


Leidos Holdings reports Q2 results: revenue up 4 percent, adjusted EPS $0.73 $0.61, with its health and engineering segment losing $7 million vs. a loss of $482 million in the previous year. Chairman and CEO Roger Krone said of the company’s Department of Defense EHR bid, “We’re in that weird period between the award and the expiration of the protest period, so we’re not going to give a lot of guidance on what’s going on. We probably have another five days or so until we think we’re safely on the other side of the protest period.”


McDonald’s tries to stem its dramatic business downturn by naming Dignity Health CEO Lloyd Dean to its board. Perhaps it missed Dignity’s web page declaration that “in today’s fast-paced, fast-food society, it can be tough to make healthy decisions for kids.” McDonald’s is getting endless pressure from franchisees unhappy with out-of-touch management and lack of buyers for their underperforming locations; competition from fresher offerings at Burger King, Wendy’s, Shake Shack, and Chipotle; and strongly slumping sales.


India-based provider search website Practo raises $90 million in funding from investors that include Google.



WellStar Health System (GA) chooses Legacy Data Access to retire its McKesson Horizon applications.


The FDA awards genome informatics vendor DNAnexus a contract to build precisionFDA, an open source platform for sharing genetic information as part of the White House’s precision medicine initiative.

Announcements and Implementations

Extension Healthcare publishes a guide for hospitals working to comply with the Joint Commission’s January 1, 2016  alarm safety goal.

Long-term care software vendor PointClickCare adds the ability for customers to receive radiology tests results into their EHR using technology from Liaison Healthcare. 


Yelp will add ProPublica-produced data to its provider business listings, including ED wait times, fines paid, and readmission information. It’s a bit of an odd relationship given that ProPublica is a non-profit, public-spirited news reporting organization now turned data vendor to a commercial customer via an undisclosed business arrangement. I took the screen shot above Wednesday afternoon. Hospitals will learn that Yelpers tend to get dramatic given one bad experience even after many good ones, so it’s common for an otherwise quiet or even complimentary Yelper to suddenly go off on a one-star tirade over something only marginally related to the business’s main focus, as they often do when they can’t get a table at their favorite restaurant or find an error in their credit card charge after the fact (you really are only as good as your latest review).

HIMSS offers so many conferences that it is now co-locating them in confusing attendees about what they’re signing up for. The latest: the Connected Health Conference in chilly National Harbor, MD in November, which includes the mHealth Summit, Cyber Security Summit, and Population Health Summit. Each requires $695 registration, but signing up for one allows attending the others.

Apple’s ResearchKit gets its first international use as Stanford’s MyHeart Counts app is made available to people living in Hong Kong and UK.

Government and Politics

The Senate’s HELP committee unanimously approves the promotion of Karen DeSalvo, MD, MPH to HHS assistant secretary for health without a hearing Thursday, clearing the way for a full Senate vote following its recess through September 8. DeSalvo has been holding the assistant secretary position since October 2014 while remaining National Coordinator. In that role, she oversees the Surgeon General, communications, regional health administrators, and a number of public health related offices.

The SEC approves a new rule that will require most public companies to publish the ratio of CEO pay to its average overall employee salary.

Ireland will roll out a national patient identifier, with the automatically assigned record including a signature and photograph. According to the health minister, “It will allow us to follow patients and staff as they move through the service in a way we currently can’t. This will improve patient safety, reduce duplication and errors, and give us a huge amount of new data that we can use to make services more efficient and improve planning.”


The American Hospital Associates asks the Department of Justice to review possible increase in healthcare costs that the proposed merger of Anthem and Cigna could cause. Perhaps the insurance companies should ask DOJ to look at hospital mergers since those seem to be increasing opportunistic pricing as well.


Arizona Governor Doug Ducey announces a plan to improve the state’s Medicaid program that includes offering personal savings accounts for paying for non-covered services and an app- and portal-based member system that includes appointment reminders, disease management tools, and a provider locator. 

Innovation and Research

Johns Hopkins University researchers develop an algorithm that uses 27 factors to predict septic shock in 85 percent of cases.



A Commonwealth Fund survey finds that 50 percent of primary care physicians see technology as improving care quality, with 28 percent feeling that HIT makes it worse. Their feelings about ACO impact are all over the place, with only 30 percent of those actually participating in an ACO saying they have a positive impact on patient care. Nearly half of PCP physicians say healthcare trends are causing them to consider early retirement.


Phoebe Putney Memorial Hospital (GA) will go live on Meditech on October 1 at a total project price of $50 million. It chose Meditech 6.1 in April 2014.

The family of a 14-year-old girl who died at a “Foam Wonderland” rave concert at the New Mexico State Fair sues the state, three promoters, two security firms, an ambulance company, a hospital, and two paramedics, claiming that all of them contributed to her death by their recklessness and negligence in failing to save her from her MDMA overdose.

Sponsor Updates

  • Medicity CEO Nancy Ham co-authors the HFMA article “The Financial Impact of Population Health Analytics in the Shift to Value-Based Models.”
  • Billian’s HealthData and Porter Research invite responses from professional marketers in a survey on marketing practices.
  • Hayes Management Consulting posts “Prepping Your Staff for a Successful EHR implementation, what you need to know.”
  • MBA Health Group and Netsmart will exhibit at the Allscripts Client Experience 2015 through August 7 in Boston.
  • MedAptus offers “A Glimpse into the Facility Billing World from a Split-Billing Expert.”
  • MedData offers “The Wait is Over: Welcome to ‘The Impatient Patient.’”
  • Navicure offers “Increasing Patient Payments with Clarity.”
  • Nordic offers the latest video in its “Making the Cut” series on Epic conversion planning.
  • NTT Data offers “Six Reasons You’re Not Yet on the Cloud.”
  • NVoq offers “Your iPhone has Good Dictation. Why Doesn’t Your Enterprise Application?”
  • Oneview Healthcare will host Health Facilities Design and Development Victoria August 17-19 in Melbourne, Australia.
  • Experian Health/Passport Director of Strategy and Innovation Karly Rowe is featured in Washington Business Journal’s “4 things to know about data security after the Children’s hack.”
  • PatientSafe Solutions offers “Alarm hazards as patient safety concern.”
  • UlteraDigital interviews Patientco Director of Marketing Josh Byrd about redesigning PatientWallet and the need for innovation in healthcare.
  • PatientKeeper offers “The Physics of EHR Advocacy.”
  • PerfectServe offers “Put down the phone, and other communication lessons from healthcare professionals.”
  • PeriGen piblishes “How research resulted in a checklist solution.”
  • Phynd Technologies offers “Is There a Solution to Provider Abuse of the Medicare System?”
  • PMD posts “Client-Server Architecture and Finding the Right Balance.”
  • Qpid Health offers “Getting meaning from patient records stuffed full of results and statistics.”
  • Sagacious Consultants launches a charity ad campaign for Tri 4 Schools at the Dane County Regional Airport in Madison, WI.
  • Salar Inc. offers “ICD-10 is still on track to launch October 1, 2015, will you be ready?”
  • Sandlot Solutions will exhibit at the EHealth Initiative’s IThrive Innovation Challenge August 12-13 in Washington, DC.
  • Elsevier Clinical Solutions, Impact Advisors, and Intelligent Medical Objects will exhibit at the Allscripts Client Experience through August 7 in Boston.
  • EClinicalWorks offers “1.5 Million Referrals Exchanged via P2POpen.”
  • Galen Healthcare Solutions publishes “Clinical Data: Hey, You Are Migrating Your EHR, Take Me with You!!”
  • Greenway Health offers “CMS Expands ICD-10 Grace Period Guidance.”
  • The HCI Group offers “Epic Consultant Corner: Robert Kight Interview.”
  • HDS offers “Thoughts on Meaningful Use by the Brookings Institution.”
  • Healthcare Growth Partners advises GMed on its sale to Modernizing Medicine.
  • Healthfinch offers “It’s Not Just a Formality: Formal Refill Protocols are a Must.”
  • Healthgrades recaps its second HG Challenge hackathon.
  • HealthMedx will exhibit at the Arizona Health Care Association Annual Conference & Trade Show August 18-20 in Scottsdale.
  • Holon Solutions offers “Next Up For Enabling Data Exchange: Transitions of Care Between Hospitals and Nursing Homes.”
  • Influence Health posts “Engaging Patients for Impactful Changes.”
  • Ingenious Med offers “IM1: Solving ZDoggMD’s Readmission Problem.”
  • InterSystems publishes “From Opposition to Cooperation: Payers Join the Care Team.”
  • LifeImage offers “The Top 5 Reasons to Integrate Image Exchange with Your EMR.”


Mr. H, Lorre, Jennifer, Dr. Jayne, Dr. Gregg, Lt. Dan.

More news: HIStalk Practice, HIStalk Connect.

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Currently there are "11 comments" on this Article:

  1. Interesting divestiture of AdvancedMD by ADP. Marlin is both an active and successful HCIT investor (IMHO) but actually no longer owns Capario (née ProxyMed), having sold it to Emdeon for $115 million in six years after acquiring it out of bankruptcy in 2008.

    [From Mr H] Thanks, Ben — I should have caught Capario as an exited holding.

  2. Re: Windows 10. Also upgraded this weekend as I recently bought a Windows 8 laptop and realized the pain of the touchscreen built interface on a PC.

    One cool thing that I liked is the start button right click menu – also an easy way to get to some of the common things you mentioned, like device manager.

    My upgrade unfortunately didn’t go smoothly. There were driver issues with my touchpad, which stopped working correctly.

  3. I am the CIO of a large hospital system that uses Cerner. We have owned the design, installation and support of Cerner and are pleased with the functionality and adoption we have. That said, I have always felt the reporting by HISTalk has been balanced and fair. Both Cerner and Epic have their strengths and weaknesses and Epic’s increased market share over the past 10 years came about because they had something better to offer. Anyone who does not choose to believe that is off-base in my opinion. And this competition has been good for Cerner customers, because Cerner has re-doubled their efforts at product development and support which has been a win for their customers and leaves us better positioned going forward. To the HISTalk team, please keep up the good work.

  4. Another “old school” language idiom that will probably never go away – note that we still “dial” our phone calls. Touch tone came in in the late 1960s and I would be hard pressed to find a dial input device on any phone today. I’m not even sure pulses are recognized by the new switch gear. When will we convert the verb to “touch” a call? Or what other term should be used?

  5. Just as our cars still have glove compartments or glove boxes, despite that fact that virtually no one has worn driving gloves for a long time, and we invariably store all sorts of rubbish other than gloves in them. Unlike those though, dial still serves a useful purpose as a verb. I think for the most part it has simply been replaced in daily use by the simpler “call,” as people don’t routinely need to refer to the process of actually punching up the numbers. That being said, “redial” has a specific and clear meaning though the referent is lost to younger folks. Substituting “recall” would be ambiguous and confusing. “Touch” or any derivative would similarly be ambiguous since the entire interface is touch based. I suspect we’ll be stuck with “dial” for a long time to come.

  6. In regards to “concerned reader’s” comments about HISTALK being a Cerner hater and Epic lover I would like to make a comment to that post. My observation is that it certainly does seem that way and does get very old. But, with that being said there is no reason to not continue to read the stories at HISTALK. Epic is just the flavor of the decade as it was for other companies before it as well as those in the future. As in anything, healthcare is very cyclical, in another 5-10 years another product will come to the forefront and be the new company to hate because it is successful. As for someone who has used many systems in the past, I have found that most products can be pretty bad if not implemented correctly no matter what their perceived popularity may be.

  7. Although their take will only be in the 7-9% range, Cerner should be kissing the ground that they got the DOD contract. The Siemens acquisition has been an unmitigated disaster thus far and will be an albatross for years to come until they can transition off the legacy systems.

  8. First, I’ve heard significantly stronger numbers bantered about in the investor community for DoD; I’m sure that will all be public soon enough.

    Second (and this is the really egregious part of the post) – Cerner has done just fine working itself across the Siemens base since February when the acquisition closed. HIStalk covered the win at Baptist South Florida like all of two days ago. I’ve heard that they’ve transitioned at least three other large IDNs or Academics to Millennium, one in my neck of the woods. I doubt Cerner is declaring victory on the acquisition, but to use the words ‘unmitigated disaster’ means you’re either:

    1. Uninformed
    2. Lazy and trolling
    3. Biased, probably because of an affiliation to one of Cerner’s competitors

  9. Anybody who has worked for a large sales/services based corporation, or has been a long term customer of one, knows that taking on a huge new client (especially a government one) ends up being a serious drain on the companies ability to service and support their much smaller clients. It’s just the reality of the situation. When you add in the high profile nature of the DOD contract the pressure will be on Cerner to make this work to the best of their ability. Thinking this will be a drain on their ability as a whole to provide support and services isn’t lazy, trolling, or uniformed. It is just common sense based on decades of history.

  10. @G8r_chomper

    None of those three actually. But I do have VERY reliable information on the subject. I don’t want to get too granular here, but Cerner is carrying around a lot of “dead weight” due to the aqusition both in the form of former Siemens employees and the physical infrastructure that needs massive updates.

    It will be easy enough over time to divest of the Siemens employees, but the capital expenditures that will be required to maintain / update the facilities over there have and will continue to be huge.

  11. HIT Guy, I’m a Cerner associate. I’ve visited the Malvern campus a couple of times in the past year. Cerner’s management has made some modest investments in the Malvern campus, such as putting up new signage, taking down the oppressive security barriers that separated parts of the building and upgrading its cafeteria to be an attractive place to eat. It’s nothing beyond the scope of what they’ve done before with other campuses. Cerner owns and has made modest investments in a number of older buildings around KC – the former Farmland Industries headquarters, the former Marion Merrell Dow / Sanofi headquarters, the former Sam’s Town Casino, etc. They’re great existing community assets that could have become blight. When you’re growing, reinvesting in older properties is less expensive than building new (which Cerner also does on occasion, like with the new Trails development and the campus in Kansas). The Health Services campus is in a great location. The HS people are good people who bring a lot to the table. Not sure where the dead weight is.

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