I love me some deep-fried oreos, but a less classic item that I wish were available at all times is…
Allscripts will sell its Hospitals and Large Physician Practices business segment to Canada-based Harris for up to $700 million in cash. The segment includes Sunrise, Paragon, TouchWorks, Opal, Star, HealthQuest,and DbMotion. It generated 2021 revenue of $928 million.
The deal is expected to close in Q2.
From the investor call:
- The company sold the business because it has shrunk for three straight years and will likely continue to do so; Veradigm is growing 6% to 7% organically; and managing unrelated businesses under a single corporate structure was becoming increasingly hard.
- Allscripts hopes to “unlock value” of its shares, whose price it feels is discounted compared to peers, by “separating pieces of the company.”
- The business had adjusted EBITDA of $145 million on revenue of $928 million. Management expects the unit’s revenue to drop 3-4% in 2022 and EBITDA to shrink 10-15% year over year.
- The unit being sold generates 60% of the company’s revenue and one-third of its free cash flow.
- Allscripts will use its expected after-tax proceeds of $600 million for share repurchase and potential M&A related to Veradigm.
- Interesting: the investor slides are copyrighted and footnoted as Veradigm, with the name Allscripts only appearing on the title slide.
From Former Eclipsii: “Re: Allscripts. So just under 12 years after buying Eclipsys for $1.3 billion, nine years after picking up DbMotion, and five years after acquiring Paragon from McKesson, Allscripts is selling its various parts for a loss? When I was at Eclipsys, we had looked at buying Allscripts and decided it wasn’t worth the effort.” Allscripts reportedly paid $235 million for DbMotion and $185 million for Paragon, so Allscripts spent $1.72 billion in acquisition costs alone for businesses that it is selling years later for $700 million, less than one year’s revenue. But wait, there’s more – it threw in former flagship TouchWorks as well. Last week’s earnings call made it clear that Allscripts was unhappy that its share price undervalues the company, a complaint that it makes just about every quarter, and that Veradigm is its future. I would be interested in hearing the reaction of Allscripts customers to the acquisition announcement. Also, what happened to the puffy 2019 announcement that Allscripts and Northwell would develop a next-generation EHR following the never-left-the-ground flop of Avenel?
From Mark Words: “Re: Allscripts. I predict that Harris / Constellation will acquire Meditech next since its business model is exactly what Constellation looks for – mission-critical software, high recurring revenue, and a somewhat stable market position in a mature market. Not to mention that Meditech is pretty strong in Canada and Harris already owns Iatric Systems, which has strong Meditech focus.” I agree it would be a good target. Constellation’s business model would support paying around $400 million for Meditech, which I doubt would entice its owners to sell.
HIStalk Announcements and Requests
Welcome to new HIStalk Platinum Sponsor Baker Tilly. Baker Tilly US, LLP is a leading advisory CPA firm, providing clients with a genuine coast-to-coast and global advantage in major regions of the US and in many of the world’s leading financial centers. On March 1, Baker Tilly merged in Orchestrate Healthcare, a multi-year Black Book and Best in KLAS awarded healthcare IT consulting firm. Combined with Baker Tilly’s legacy healthcare practice, their combined practice brings providers solutions for financial sustainability, integration and interoperability, EHR implementation and optimization, healthcare analytics, information security, and healthcare IT staffing. The company’s healthcare IT consultants are seasoned professionals with both a broad range of experiences and a deep understanding of how to listen, analyze, and innovate for process improvement. With over 1,400 healthcare IT engagements from Orchestrate and more than 3,100 healthcare clients from Baker Tilly, the company’s team of healthcare specialists excels at what they do, so your organization can excel at what you do. Baker Tilly is an independent member of Baker Tilly International, a worldwide network of independent accounting and business advisory firms in 148 territories, with 36,000 professionals and a combined worldwide revenue of $4 billion. Thanks to Baker Tilly for supporting HIStalk.
I’ve updated my guide to what HIStalk sponsors will be doing at ViVE next week. You can also download a PDF version. Want to make me look good? Let them know at the conference that you saw them listed.
Speaking of which, HIStalk sponsors who are participating in HIMSS22 should fill out my form by end of day Friday, March 4 to be included in my guide for that conference.
And speaking of HIMSS22, six exhibitors will staff booths of at least 4,000 square feet – EClinicalWorks, Epic, Microsoft, Cerner, IBM, and Athenahealth.
Don’t try this at HIMSS22: I’ve noticed several ViVE-related meetings and social events that will be held on boats. I’ve been on a couple of these in years past and they were fun, although choose your host carefully because you’ll be captive for hours.
Acquisitions, Funding, Business, and Stock
Cognizant develops a remote patient monitoring solution using Microsoft Cloud for Healthcare.
Cancer risk assessment software vendor CancerIQ raises $14 million in a Series B funding round.
Israel-based research data discovery platform vendor MDClone raises $63 million in a Series C funding round.
- University of Rochester Medical Center selects Spok Care Connect to replace its operator console and support clinical communications at Strong Memorial Hospital.
- Behavioral health staffing and services provider EvolvedMD will implement NeuroFlow’s patient registry and mobile technology to enrich collaboration with HonorHealth’s 24 locations.
- Orbita and OnCall Health choose Lyniate to solve data-sharing challenges.
- Health Gorilla will incorporate clinically validated social determinants of health scores from LexisNexis Risk Solutions in its Health Interoperability Platform.
- Respiratory remote patient monitoring platform vendor Spire Health chooses Redox for EHR integration.
- Hospice of Wichita Falls will implement WellSky’s hospice and palliative care solution.
- Opioid use disorder virtual care provider Bicycle Health will use Bamboo Health’s Pings and Spotlights for real-time insights into ED and inpatient care utilization.
- Healthwise will integrate First Databank’s Meducation multilingual monographs into its digital point-of-care and patient education solutions.
John Chelico, MD, MA (Northwell Health) joins CommonSpirit Health as SVP/CMIO.
Harmony Healthcare IT hires Tamara Korbel, MBA (PDS) as SVP of operations and client experience.
Christine Yang (Stanford Health Care) joins Alameda Health System as VP/CTO.
Laurence Kessler, MPH (NThrive) joins Healthrise as SVP of growth and partnerships.
Announcements and Implementations
Styker-owned Vocera announces Minibadge, a hands-free, voice-driven communications device for mobile healthcare workers.
Diameter Health releases a technology and services solution for HIEs and data aggregators that are undertaking NCQA’s Data Aggregator Validation program.
CareMesh implements FHIR-based integration of its Navigate clinical program management system with Epic and Cerner.
VCU Health System went live on Epic on December 2021 with the assistance of CTG, which provided legacy system support, go-live preparation, data conversion, optimization, training, and at-the-elbow support.
CVS Health launches a Health Dashboard to allow people who received COVID-19 vaccination from CVS Pharmacy or MinuteClinic locations to access their record and print a QR code. The company says the dashboard will be expanded beyond vaccination and COVID test records.
Government and Politics
I missed this a couple of weeks ago: a federal jury convicts a Palm Beach, FL psychiatrist for billing private health insurers $110 million for drug urine screenings at a sober living living facility that was taking kickbacks to refer patients. The doctor, who was also the sober living facility’s medical director, wrote standing orders for the facility in exchange for a monthly fee and then had the patients sent to his office so he could bill several tests per week per patient at up to $9,000 per test. We hear a lot about insurers that are powerfully armed with big data capabilities, but how hard would this have been to detect given the dollar volume, the obviously frequently repeated tests, and the fact that it’s South Florida? Maybe this supports the argument that insurers have limited zeal for chasing fraud since it’s easier to raise premiums.
- Cerner President and CEO David Feinberg, MD joins Humana’s board.
- Bicycle Health, a virtual care company specializing in treatment for opioid use disorder, expands its use of Bamboo Health solutions to include Pings and Spotlights solutions for real-time insights into ED and acute inpatient care utilization.
- Impact Advisors celebrates its 15th anniversary.
- Jvion will exhibit at the Rise Summit on Social Determinants of Health March 20-22 in Nashville.
- Kyruus publishes a new infographic, “The Growing Role of Health Plans in the Search for Care.”
- Nordic Consulting has received certification from HITRUST via the risk-based, two-year validation process.
- Duty of Care for Business Travelers (Everbridge)
- 6 Components of a Vulnerability Threat Management Program (Fortified Health Security)
- A Renewed Appreciation for the Work Commute (HCTec)
- 9 Ways to Address Healthcare Staffing Challenges using Human Capital Management (Healthcare IT Leaders)
- The Importance of Epic Community Connect Service Level Agreements (Impact Advisors)
- The developer experience: how to nurture and retain existing tech talent (InterSystems)
- Managing HCCs for the right reimbursement (Intelligent Medical Objects)
- Will We See You at the ViVE Conference? (LexisNexis Risk Solutions)
- Leveraging AI Principles from Financial Fraud Detection to Identify Medication Errors (MedAware)
- Is Double Documentation Delaying the Delivery of Surgical Care? (Medhost)
- Privileged access management helps mitigate insider threats before they happen (Meditech)
- What is a SOAP Note in Physical Therapy? (MWTherapy)
- How Vanderbilt is improving the physician and patient experience with virtual assistant technology (Nuance)
- Why healthcare leaders should embrace the cloud (Nordic)