Monday Morning Update 8/13/07

From Michael Vronsky: “Re: Holy Spirit Hospital. How about a follow up with Holy Spirit Hospital? I think you’d be pleasantly surprised what their CIO (Edith Hunter) and others have to say nine months later.” This was a replacement of Soarian with Eclipsys. I’ll ask Inga to look them up and report back.

I got e-mails from a couple of journalists who were nice enough to let me know that they use HIStalk as a source of story ideas and opinions. That came after a reader accused the HIT publications of stealing ideas from HIStalk. My server records show other incoming domains from HIT magazines, but at least these had the class to tell me. Should I call the others out publicly?

Burt Finkelstein, formerly of Cardinal Health and Johns Hopkins, joins VisualMED as Senior Pharmacist.

NextGen gets a mention in the Pawtucket (RI) newspaper when Blackstone Valley Community Health Center goes live, claiming to be the first place in the state with all electronic records. Most of the state government seemed to be on hand to see a demo (must be an election year).

EMR/PHR vendor Ethidium Health Systems announces its acquisition of the VLink health information exchange product from Vaceris.

McKesson spent $560K on federal lobbyists in the first half of this year.

The White Stone Group announces an upgrade to its TRACE communication tracking system for eligibility and benefits that allows capturing images of entire web pages, documents, and e-mails. TRACE can now fax those images directly to payors or physician offices to handle payment disputes. Payor changed their website since the service was rendered? You’ve got a picture as proof.

I’ll put out this week’s Brev+IT shortly. If you’re quick on your trigger finger on Saturday afternoon, it’s not too late to sign up to your right and get your copy. Otherwise, I’ll just tease you about how great it was next week. Hmm, what were the five most important HIT news events this week?

Marty Belscher joins Emerson Hospital of Concord, MA as VP/CIO. He comes from FCG. Seeing his Ed.D. credential made me remember that he worked on an engagement for me once. Seemed like a good guy.

WorldVistA EHR is CCHIT-certified, but still not ready for release. The issue: drafting a user agreement that allows them to modify the software as open source while avoiding nullification of its CCHIT certification. They’re also working out royalties for use of CPT and Zip codes. Somebody must be using it since CCHIT doesn’t certify products that aren’t GA and running.

Parkland Hospital (TX) is using background-checking software to catch patients who lie about their address or income to get free care to which they aren’t entitled. The system flagged 12,000 cases of potential fraud, they’re going after several hundred, and more than a dozen people have pleaded guilty and paid up. Oddly enough, most of those first prosecuted are small business owners from Middle Eastern countries, several of them related, who falsely claimed to live in Dallas County to get county charity care. One guy who owns nine Subway franchises and drives a Mercedes told the hospital he made $8 an hour as a sandwich maker. He paid his $47,000 bill in cash when caught. The criminals mostly seem indignant or indifferent since healthcare services, as we all know, are steadfastly viewed as free by those who can’t or won’t pay.

Another company no one’s heard of is offering free physician EMRs that will supposedly be supported by ad revenue. Actually, I’m probably the only one who’s never heard of them since the product is CCHIT certified. It’s apparently run by individuals too shy to list their names on the web page (why are companies so secretive about who’s in charge?) Here’s a free 60-second strategic consulting session from Mr. HIStalk: ad supported EMRs can work, but not by running crappy Google AdSense text ads like Practice Fusion is trying to do. You need to have a strong marketing arm that can develop ad packages specific to practitioners, like some of those Australian EMR companies have done. To really work, you’d have to throw ethics to the wind and jam the ads right into the care process: popping up medication commercials based on patient diagnosis, suggesting a competitor’s alternative when e-prescribing, or integrating permission-based marketing for patients. Companies would pay for that because it would work and many doctors are crass enough to go for it.

Consulting firm RTI tells ONCHIT that EMRs need more safeguards against fradulent billing.

Lawson Software’s CEO says software-as-a-service won’t live up to its hype.

Oracle says it’s too hard to figure out a pricing model for software running on virtual servers, so it will just keep collecting your money as usual, thanks.

Wisconsin Health Information Exchange has expanded its Executive Director role to full time and is seeking candidates. And, if you like the heat (geographical, not job-related), Qatar Hospital is looking for an executive director of health information systems.

Rumors and ideas? E-mail me.

News 8/10/07

From Joseph L. DiNardo: “Re: other sites. I notice that [name removed] has a story on private equity in healthcare IT. Other magazine stories and sites seem to just write about what you do, except later. They’re ripping you off.” Well, I could turn into Howard Stern and claim I invented the genre, but I won’t. Certainly I’ve noticed some remarkably coincident news and opinion pieces over the four years I’ve been writing HIStalk. I’ll attribute that to subsconscious influence, kind of like when one singer hears a song and writes another one very much like it. If I influence them, good for me.

From Doc Hilarity: “Re: you must be flying under the radar.” Link. Somebody wrote a program to chart out the healthcare “blogosphere” and HIStalk doesn’t look like a big deal on it. Reason: it counts links to and from. I don’t link to other sites and don’t expect anyone to link back to me. Here’s the stat that counts: HIStalk has more readers, page views, and sponsors than any site I know. If those slip, I’ll know I’ve left the Blogosphere and entered Suckitude USA.

From Shortwave Coates: “Re: Healthia Consulting. Healthia Consulting Sells to UHG? That was the word from some Ingenix employees (a division of United Health Group).The consulting company’s CFO, rarely seen at client sites, was visiting Ingenix this afternoon.” Since I’ve got Healthia contacts because they sponsor HIStalk, I sent it their way for a response. “As you may know, UHG and many of their companies / business segments, including UnitedHealthcare and Ingenix, are clients of ours, and our entire leadership team takes a strong interest in having close relationships with each of our customers to ensure the quality of our services meet and hopefully exceed expectations. Additionally, UnitedHealthcare manages our employee benefits, so our leadership team communicates with and/or meets with UHG staff regularly. Due to the strong reputation we’ve built in the industry, we do periodically get approached by companies across the industry about strategic partnerships the depth of interest in those relationships varies across the partnership spectrum. In the event we determine that a strategic partnership at any level with any organization is in our colleagues’ and clients’ best interests, we’ll let you know and work with you to publish complete and accurate information, so that the readers of HIStalk are informed.”

From Bill Hafner: “Re: Cerner. I saw the stock rocket upwards Wednesday. Looks like there was an Investor Day at the HQ on Tuesday. These financial guys came away thinking Cerner was doing pretty well. What do you think?” Bill attached a fancy report on the visit from stock guys Thomas Weisel Partners. Some quotes: “Tuesday, August 07, 2007, we met with Cerner management at its Kansas City headquarters. The highlight of our trip, by far, was the tour of CERN’s newest data center located on its corporate campus … Our trip to the Experience Theater was impressive. The company has always proclaimed that once it gets a potential customer to the Experience Theater, the probability of a customer win is high.” Sounds like the Tom boys were so wowed that they just about bought Millennium themselves instead of just CERN, like many CIOs so distracted by the carefully scripted Vision Center sizzle they forget to check the steak along with their checkbook. You’d think investment guys would be more cynically realistic, or at least not report back with such obviously fanboyism. What I think: less than that, certainly. Cerner is managed well and entrenched, but Epic is stealing a lot of their high-margin, big IDN business. They say they’ll make money in the UK, but I doubt it – no one has so far. They don’t play much in outpatient, still struggle with non-clinicals, and have taken only baby steps into non-provider markets to try to find another growth area to prop up the share price. Meditech has the entire low end of the market staked out already, so there’s nothing there for them. I expect clinical sales to dry up because those hospitals who can afford the ridiculous price tags have already shot their wad. If Cerner wants growth, they’ll have to buy it through acquisition. Just my opinion, of course. That fancy data center that the investors drooled over won’t sell much product, especially since most clients run their stuff locally anyway. It’s not that Cerner won’t make money; it’s just that the growth built into a lofty share price will be hard to sustain now that the numbers are a lot bigger.

From Cao Van: “Re: Piedmont. Any update on the OIG Audit?” I haven’t heard a thing.

It’s my pleasure to introduce you to Stratus Technologies, a brand new HIStalk Gold Sponsor. What they do: five-nines system availability, redundancy, and system monitoring and alerting. System availability is critical once you’ve installed all those EMR and real-time clinical systems, so these are the folks who can help. They’ve been around for 27 years and have a big presence in other continuous availability industries (six of the world’s 10 biggest banks and 14 of the 20 biggest telecom providers, for example). Stratus, of Maynard, MA, was the first to offer a 100% availability guarantee for Windows Server in 2002. All you need to remember: continuous availability=Stratus. Thanks to Stratus for supporting HIStalk and respecting its readers by doing so. I appreciate it.

And speaking of Stratus, they’ve got a case study from Orthopedic Center of St. Louis: “Bonner finds Stratus’ ActiveService architecture particularly helpful because it amounts to having ‘another staff member on call 24×7 to monitor the server .. ftServer system is constantly in touch with Stratus’ service center, which monitors its performance. If the server has a problem, it alerts the service center, which either corrects the problem remotely or sends a ‘hot swappable’ component to fix it … the ftServer, which comprises redundant components running in lockstep, continued to run the practice and clinical management systems with no interruption at any time, including during the replacement. When Bonner finished, the server automatically resynchronized and returned itself to full redundant operation.”

Remember those Bulgarian nurses and doctor who were arrested by the Libyan government in 1999 and charged with intentionally infecting 400 children with HIV? They were stuck in jail until last month, constantly threatened with execution unless Bulgaria sent Libya a few billion dollars, but finally were released last month. The Libyan government now sheepishly admits that their confessions were extracted by torture. “Yes, they were tortured by electricity and they were threatened that their family members would be targeted. But a lot of what the Palestinian doctor has claimed are merely lies.” 

Cerner gets a mention for its surgical tracking system that keeps families informed of the patient’s status. They get a card with a confidential number and can look at the patient’s status on a plasma screen in the surgical waiting room (like “PRE-A” or “OR” or “PACU”).

The St. Louis paper runs an article on Purkinje’s physician office dispensing system. I’m vehemently against that concept from a patient safety standpoint, especially when pitched as a revenue booster for doctors, but Purkinje supposedly has built safety checks into its electronic systems. Like Allscripts, Purkinje got into the business by acquiring a company already in it, back when they were Wellinx. I know next to nothing about them, but they sound like of interesting.

A reader e-mailed me to ask, “What are the top three HIT-centric publications that are well read and well respected?” I honestly couldn’t think of any. I don’t read any of them and my feeling is that most industry people don’t either. What little real news they carry is two months old by the time the issue goes out, plus the non-expert reporters just re-word the press releases anyway in most cases, keeping it friendly to advertisers. Of course, I’m biased.

QuadraMed announces not so great Q2 numbers: revenue up 7%, EPS $0.02 vs. $0.06. The stock headed south, trading near its 52-week low and now down 24% in a month. Some folks on the conference call claimed that Keith Hagen was wishy-washy on the financials of the Misys CPR product that QuadraMed bought, leading to speculation that the deal could be in danger once the bean-counters shine a harsh light on those books. Doubtful, but they still have to figure out how to make money from it.

Pravene Nath is named CMIO for NYU Medical Center. Mentioned by Toni Rienzi when Inga interviewed her. And when looking for that link, I ran across this oldie but goodie phony news issue of HIStalk, which had me cackling even though I wrote it.

HIMSS joins some trade associations in trying to get the President to override the ITC’s ban on imported 3G cell phones containing Qualcomm chips, claiming a threat to public safety. Broadcom probably doesn’t agree: it was their patent that Qualcomm infringed upon, according to a previous unanimous ITC ruling. Doesn’t sound like something HIMSS needs to be involved with. Guess their CPOE and RHIO work has been successfully completed and cell phones are the new imperative.

Merge Healthcare shoots off whatever toes it had left, announcing a delay in filing their Q2 report on the day it was due. Stock board speculation was coalesced around three themes: (a) top management is bailing out; (b) the company will be bought; or (c) everybody in charge is a moron.

Cardinal Health announces Q4 numbers after the bell: revenue up 5%, EPS $2.33 vs. $0.76, although most of that came from the sale of one of its business units to private equity star Blackstone Group.

Interesting: this Mac-based practice management system uses MySQL for its database.

Odd: a surgeon in federal prison for 51 months for healthcare fraud is suing Apple, claiming he invented the iPhone’s keyboard.

Former Sutter CEO Van Johnson joins the board of Visicu. Different Van Johnson: it’s not the slightly dense blonde guy (Lt. Steve Maryk) from The Caine Mutiny, I now know (although he’s still alive and will be 91 in two weeks, so here’s an HIStalk shout-out, you big lug).

Allscripts announces Q2: revenue up 17%, EPS $0.10 vs $0.05. The stock dropped; analysts expected $0.14.

Emageon’s Q2: revenue down 14.8%, EPS -$0.01 vs. -$0.04.

Odd lawsuit: a Nigerian man who took his sick neighbor to the hospital in Saudi Arabia has been arrested there for immoral behavior by Islamic religious police. Men aren’t allowed to associate with unrelated women, even when saving them.

News, rumors, blogosphere positioning developments: e-mail me.

News 8/8/07

From Victor Melling: “Re: Perot. Perot already has an offshore company dedicated to healthcare. Their plan to aggressively grow the healthcare organization has to include international initiatives. In the international market, you can’t just take something American and expect the rest of the world to follow. You do it with country-specific nationals, and in some countries, it will make the best business sense to acquire. Don’t forget the payer and government side of their healthcare biz. Services are a key.” Victor was talking about Perot’s $10 million acquisition in 2003 of Vision Healthsource. Back then, it was a 500-employee BPO company doing healthcare claims and billing. Thanks for that report.

From Stan Fields: “Re: Are you sick of Misys yet? Last week, four more senior folks left. Not sure if they chose to leave or were asked. All were long-timers and two were on the Wall of Fame. Either they’re cleaning out the old guard or the old guard has had enough.” I’m always uncomfortable naming names, so how about first names only: Tammy, Scott, Stephanie, and Karen. I think I am getting sick of Misys rumors, finally, although their diaspora should have wide influence on the industry.

From The PACS Designer: “Re: CafeScribe looks interesting, as it fosters the shared learning experience that permits updating of text material and experiences similar to how a wiki operates. Through this shared experience, healthcare IT users can expand their knowledge base and interact with others who share the same desire to learn.” Link.

I hope you enjoyed the interview with Vince Ciotti. I should have warned those of you who don’t know Vince that he speaks his mind. Sometimes he’s pulling your leg, sometimes not, but he’s always entertaining. He cracks me up.

Speaking of interviews, if you know someone interesting I should talk to, let me know. I learn a lot every time I do one.

I’d like to recognize a loyal HIStalk sponsor both old and new: InterSystems. Old, because InterSystems has been a Gold sponsor of HIStalk for some time. New, because they just upgraded to Platinum, for which Inga and I thank them very much. As in the case with Vince, I’ve been their customer, although they don’t know that because I’m anonymous. I’ve used Cache’ and it’s a smoking-hot database, running faultlessly under heavy, enterprise use at a big IDN I’ve worked in, and with minimal care and feeding on our part (say the words “Cache DBA” at my old shop and they’ll look at you blankly – it doesn’t need one). You know that already, of course, because it runs what seems like 80% of big healthcare apps already (Meditech, Epic, both lines of QuadraMed, etc.) Equally hot stuff are the company’s Ensemble integration platform and HealthShare for EHR data sharing. Anyway, many thanks to InterSystems for the vote of confidence. Say, I bet CEO Terry Ragon would be a great interview. He’s one of several Boston-area giants of the industry.

And speaking of CEOs, thanks to those who are recommending HIStalk sponsorship to their CEO peers in other companies. I’ve gotten several e-mails out of the blue from CEOs who start out by saying, “So-and-so tells me he loves your site and that I should really consider sponsoring …” I’m blessed. Thank you. That’s really cool.

I’ve received two unverified rumor reports claiming that a well-known Meditech consulting firm is about to be sold. One says the buyer is Perot Systems. I’m not naming names because I’ve received incorrect rumors about this company before. Still, the sources appear to be unrelated and Perot says they’re buying somebody. We’ll see.

Errata: I inadvertently cleaved off a zero from the UPMC server virtualization numbers last week. Their engineers estimated a server cost of $65,000, not $6,500. I said they estimated a cost 98.7% less than the software vendor’s server specs, but the actual number was 87% less (still not exactly chicken feed). I also got a follow-up from Marc Holland in response to some reader comments. He mentioned that UPMC’s high growth (25% in Wintel server count per year) plus software rollouts and end-of-life replacements mean they’re saving big bucks quickly. They’re also feeding an enterprise-wide SAN instead of direct-attached storage to cut costs even more (both cost per gigabyte and cost per usable GB due to easier provisioning from a central storage pool). Thanks, Marc.

Quality Systems (the NextGen ambulatory EMR people) reports Q1 numbers: revenue up 17%, EPS $0.29 vs. $0.28. Wall Street wanted $0.33, though, and the stock is down around 10% since the announcement.

DR Systems announces 10 new small-hospital RIS/PACS contracts worth $5.6 million.

Alberto Kywi is promoted from CIO at Cottage Hospital to SVP/CIO of Cottage Health System.

Cleveland Clinic names Sulaiman H. Sulaiman as CIO of its Abu Dhabi project.

The two organizers of the German HIT trade show ITeG are parting ways and arguing over its name. Issues: location, whether to add HIMSS-like educational sessions, and control.

Dell, Fujitsu, and Lenovo will offer hardware discounts to organizations that receive grants from the Center for Community Health Leadership of Misys.

Joseph Zaccagnino, former Yale-New Haven Hospital CEO, is named to the board of Premise Corporation. They sell throughput and patient flow applications: bed management, bed cleaning, transport, and executive dashboards.

I see quite a few folks signing up on my e-mail lists to your right. The first one is to get e-mail updates when I write something new here. The second is for the new Brev+IT (pronounced “brevity”) weekly newsletter, which you’ll get only if you sign up. Help me spread the word on that one by forwarding your copy to anyone else who might be interested, please. It’s aimed at C-levelers who might not enjoy the insider stuff here that the rest of us love. It looks deceptively simple, but the value is having culled out only the most important news of the week and added some perspective and opinion around it, all in a quick-read package that’s self-contained in an e-mail.

Laparoscopic gastric bypass patients at Sinai Hospital of Baltimore whose doctors used robots for bedside rounding had a mean length of stay of 1.26 vs. 2.33 days for traditional rounding.

A hospital in Belgium is using .NET-Java EE integration tools for its portal, developed on WebSphere and running on Linux with an Oracle database. They’re developing with Visual Studio and compiling to Java (!)

Cool: three foundations donate money to pay for a document-based EMR for behavioral provider for foster children in Kansas.

A Wall Street Journal story describes a neurovascular surgeon who bought an iPhone on launch day to access his practice’s EMR. I also like an unrelated tag-on at the bottom that ridicules common IT terms. “But the word implies that the ‘users’ are utterly dependent on the provider …Today, all the term does is emphasize technology at the expense of the task someone is trying to perform. To an IT person, you aren’t writing a message, you’re using email … We also hate the term ‘solution.’ IT people often say that they have a customer-relationship solution or a supply-chain solution. The word ‘solution’ not only doesn’t tell you what it does, but also doesn’t tell you what it is. A supply-chain solution might be software, but it might be a storage rack in a pickup truck, or it might be a cardboard box.” Amen, brother.

Craig Barrett’s horses aren’t the only ones with an EMR. “Horses treated by Hagyard will soon have electronic medical records that allow their veterinarians to see their history from anywhere in the country. Images taken by the practice’s 11 digital X-ray machines allow veterinarians in the field or working for bidders at horse sales to see a horse’s file from computer work stations set up on site. They can do endoscopies and bone scans, and soon will have MRI capability to help diagnose problems. There’s a hyperbaric oxygen chamber for treating horses with a variety of conditions and a treadmill on which to test respiratory function and lameness. A neonatal ICU cares for newborn foals. The babies get ‘their own little Tempur-Pedic mattresses,’ which tour guide O’Flynn says helps eliminate bed sores.” Say, I could be the first veterinary CIO. Sport horses apparently get better care than a lot of humans, but then again, they’re worth a lot more in real dollars, sadly enough. The short, whip-wielding guy on their back probably has no insurance. At least he won’t be put down if his leg breaks.

Amcom announces its Answering Service module for call center customers.

Bizarre: a Minnesota man decided he needed to have his testicles removed. When hospitals refused, he found some amateurs willing to tackle the job in his home. He awoke, bleeding, in a makeshift OR complete with medical supplies, specimen jars, and a camera. The impromptu surgeons had high-tailed it when police were called and the man wouldn’t name them. Larry, Moe, and Curly?

News, rumors, good HIT sales stories: e-mail me. Thank you for reading.

Monday Morning Update 8/6/07

From Morrie Kessler: “Re: Perot Systems. On the acquisition hunt? Any ideas of who it could be?” The company announces that Q2 revenue was up 11%, but EPS dropped to $0.18 vs. $0.21. As part of the announcement, Perot says it will acquire a company with $80-90 million in revenue in the next few weeks (OK, I need to know who … whisper it to me). They also mentioned a plan to acquire two or three companies each year in their focus areas, with an interest in expanding outside the US (i.e. “we need cheap offshore labor like FCG and those other guys”).

From Paul Cicero: “Re: Kaiser. Even the Kaiser-bashing Sac Bee pointed out that the surgeon accused of killing the mentally retarded, dying patient for the purpose of harvesting his organs, who actually didn’t die when they took him off life support and gave him a stunning amount of drugs in order to ease his assumed passage, wasn’t working as a Kaiser physician when he was performing his service. I know you are not a Kaiser basher, so I thought I’d point that out.” Thanks. I didn’t catch that in the story. That may keep Kaiser off the inevitable lawsuit list, although having him on staff and providing him with what I assume is the bulk of his livelihood can’t be good PR nonetheless.

From Buffy Patterson-Davis: “Re: Intel’s Craig Barrett. You are soooo right! He has been insufferable at the AHIC meetings that I have attended. Just ridiculous. He seems to think that attaching a few devices to a home health care network will solve the whole problem. I’m always impressed at how polite the clinicians are in the crowd when he is speaking – they never boo. I’ve heard a lot of corporate execs talking about health care lately and the bottom line has been a deep fury at having to spend money on the benefits. I mean, they are livid. They try to hide it, but it just bursts out. I sat next to the heir of a prominent company at a meeting and the resentment was plain. They just don’t want to pay. Period. They don’t want to pay taxes, either.”

From Billy Batts: “Re: UPMC. Interesting discussion about UPMC’s environment. A couple of comments: 1) cost savings and cost avoidance are very different. If you project sizable costs and then avoid them, that’s not the same as cost savings, which are usually measured from your existing cost base. Much of UPMC’s public statements about costs appear to be based more on avoidance than savings. And of course, there is somewhat of an incentive to project future costs as high as possible so that the avoidance of those costs looks really good. 2) Going from 40 servers at $500K down to six servers at $6.5K defies common sense. If UPMC’s engineers are really going to ‘roll out an application to additional sites’ and claim to be able to do it with a half dozen desktop machines, there is a major disconnect somewhere. So I wouldn’t necessarily bet on UPMC in this case. 3) Holland should be more cautious in his claims. We have been heavily virtualized with both servers and storage for several years, as is the case with other healthcare sites. It’s tiresome to keep hearing how far behind we are. Healthcare is arguably the most complex industry in our economy and our IT environments reflect this. Claiming that we should have the same technology environment as much simpler industries demonstrates a lack of appreciation for the challenges we face in our business, and is not a reflection of ‘how good we are’.”

And speaking of UPMC, Inga tried, at Art Vandelay’s suggestion, to connect with UPMC to talk about virtualization. She got a curt “no” in response to her request for an interview. We’ve got a few UPMC readers, so the first words I thought of (an old, crude saying) involve people you’d sleep with, but not bring home to meet the family. I guess we don’t have the cachet of those inexperienced kid journalists who’ve never worked a day in either healthcare or IT. Maybe I should ban UPMC’s IP address from reading here.

I’ll be writing and sending the first Brev+IT shortly. Consider this a beta test, just in case I mess up the formatting or e-mailing. I see 141 subscribers so far. I may post the first issue online to encourage (or discourage, depending on how it goes) new signups. UPDATE: First issue is here. Subscribe to your right if interested.

Sponsor website cruise: (1) I see that Healthia has some interesting consultant positions open for clinicals, surgery, pharmacy, radiology, and HIM, to name a few. If your consultant employer has chewed you up and spit you out, give them a look – they’ve got a great reputation for being employee-friendly. (2) EnovateIT has redesigned their site, I notice, and you can more easily find specific products from a front-page product selector. (3) You probably noticed EHRConsultant’s rotating ads to your left, which now describe the company’s main offerings: the EHRscope product guide, their Naturally Speaking product line with 12 medical vocabularies, and the flagship EHR Consultant service for matching physicians with EHRs. (4) Our friends at Pring|Pierce Executive Search are ready to apply their industy experience to place executive-level talent (sales, marketing, strategy) reliably, effectively, and professionally. (5) Providers who need assistance with strategic planning, operational assessments, patient safety, and contract negotiation (and who doesn’t) and at the right price (even better) should give a look at MedMatica Consulting Associates. They’ll put experienced, regional resources on the ground quickly and cost-effectively to energize your projects and maybe keep you from getting fired when your teams are in over their heads. (6) Last but not least, our colleagues at The White Stone Group can help with documenting and managing communications, such as in denials management and caregiver hand-off (Joint Commission, anyone?) Who couldn’t use a patient-indexed communications capture system that involves minimal IT headaches and slam-dunk ROI? Please help HIStalk by clicking sponsor ads to your left and checking out what they offer. They keep HIStalk coming free and I appreciate them.

I ran across a press release from Lucida Healthcare Group that describes cool technology they came up with for recruiting traveling nurses. They have trucks carrying mobile billboards that invite sending a cell phone text message for more information. Then, data from the GPS systems in the trucks is merged with the incoming call records to measure the effectiveness of each truck’s route, allowing re-routing for optimal ad response. That’s almost as good a testimonial for their savvy as their HIStalk sponsorship (shameless plug by me).

Alamance Regional (NC) chooses SIS surgery through their Eclipsys partnership.

Any Travel, Inc. may be suing Misys for supposedly trashing its El Dorado office buildings in Tucson, but apparently the damage wasn’t bad enough to discourage buyers. The property has been sold for $5.8 million to a company that will gut the buildings in turning them into a multi-tenant complex.

A physician systems consultant criticizes the industry in a letter to the editor of a Vermont newspaper: “What I saw, all too frequently, was a prime example of people in the computer technology field taking advantage of others that have little knowledge of the technology involved. I saw one office pay nearly $7,000 each for computers that were worth $300 and then buy software that was more than 10 years out of date … An electronic medical records system is just software in which a vast amount of information is saved and interlinked. Most modern commercial, off-the-shelf database management software can be programmed so easily that even complex networked or Internet-based software can be custom developed to create centralized software applications that service a large number of geographically dispersed offices.”

Scottsdale Healthcare (AZ) is piloting what its vendors say is the first patient room service meal system that checks dietary restrictions and allergies.

FCG reports lackluster Q2 numbers: flat revenue, EPS $0.12 vs $0.20. They tried hard in the announcement to confuse readers into comparing the current EPS with those from last quarter instead of Q2 ’06, or at least it appears to me. Shares jumped nearly 9% on the encouraging news that profits tanked, but not as bad as everybody expected.

A California judge orders jurors in a medical malpractice case not to see Michael Moore’s Sicko, which featured a similar case. Good advice they probably didn’t need: the movie has done only $22 million of business, although Moore’s deal is 50% of the gross, so his stomach is jiggling all the way to the bank. If it ends up doing as well as his previous movie, he’ll pocket over $100 million (plus a huge cut of DVD sales) for doing whatever it is he does. You have to love a socialist blowhard with a populist message who’s worth more than the captains of industry he hates (and who actually create jobs). Plus, his foundation (with minimal donations to actual causes) has owned shares in Halliburton, defense contracting giants, and even those carmakers he ripped in Roger and Me. He also claimed in a previous movie that he would “hire only black people,” but not even one has crept into the credits so far. And, he proclaims disdain for copyright laws, except when he’s demanding that people not download his own movies. “When Moore flew to London to visit people at the BBC or promote a film, he took the Concorde and stayed at the Ritz. But he also allegedly booked a room at a cheap hotel down the street where he could meet with journalists and pose as a ‘man of humble circumstances.” What a gasbag.

CPSI promotes Darrell West from controller to CFO.

I didn’t realize you cared so much for Clarion Health Center (PA) It was darned nice of you to send $100,000 of your Federal tax dollars to them to help pay for their EMR software.

Wisconsin hospitals are going crane-crazy erecting new Taj Mahospitals. Bet they’ll keep those diagnostic machines cranking to cover the $1 billion tab. In fact, a local business guy claims it’s driving up healthcare costs (duh) and that Milwaukee alone has more MRI machines than in all of Canada. Children’s Wisconsin wins the prize at a $2 million per bed project (children’s hospitals are always out of control financially because “it’s for the kids”, meaning “don’t dare question our budgets or we’ll drag out awww-inducing snapshots of tykes while you’re PowerPointing financial statements”). Here’s my theory: non-profit guys don’t get juicy stock options, so they spend the money building monuments to their own wonderfulness, convincing themselves it’s really for the patients or the community. The execs at places I’ve worked couldn’t wait to put on their honorary hard hats and run around the job site looking important. Hint: hire more nurses (or build a cheap, functional nursing school and graduate a lot more of them) if you want to do the community a favor. And, if you want to get really crazy, cut prices for the uninsured.

CareTech Solutions announces its BoardNet product, a secure communications portal for hospital board members.

Meditech’s latest quarterly SEC filings: revenue up 11.3%, EPS $0.67 vs. $0.59.

Talk to me.

Well, I’m embarrassed. I’ve never watched Mr. Ed (it seemed too stupid even among stupid TV shows), so I didn’t recognize the theme lyrics that Scot wrote were the originals. Still, that inspired him to compose his own, in honor of Craig Barrett and his EMR-powered horses.A horse is a horse
Of course, of course
And no one can talk to a horse of course
That is of course unless the horse
Has an equine EHR.

Go right to the source and ask the horse
He’ll give you the medical history that you’ll endorse
He’s always on a steady course
The horse has EHR!

People yakity-yak a streak
And waste your time of day,
But a horse will never speak
Unless he has something medical to say!

A horse is a horse
Of course, of course
And this one will complain about EHR privacy ’till his voice is hoarse
You never heard of a talking horse?
Well listen to this:
“I am a horse with EHR!”

Premier Healthcare Alliance names Randy Thomas vice president of Integrated Product Management and Marketing. She comes from IBM and, before, that TSI and Eclipsys.iMedica announces their customer based has increased 76% in the first six months of 2007 as 77 new clients have purchased their EMR/PM integrated solution. iMedica, based in Dallas, was started by several old Millbrook employees after GE acquired Millbrook. I have heard the iMedica product has functionality similar to GE Centricity (the old Millbrook product) but with lots of technological bells and whistles such as .NET.

Thanks to Bill Lynch of Axolotl, who took the time to write a note reminding me that despite Santa Barbara’s RHIO failure, there have been other efforts that are making good progress. “HIEs/RHIOs have been up and running, successfully, for quite a while. HealthBridge, Taconic/THINC, Quality Health Network and many others have shown what can be done if you build your HIE with committed partners, candid communications, clinician-first workflows, and proven technology.”

A couple in Arkansas just had their 17th child. Wow. Why, why, why? Guess it is not as odd as the lady in Mexico City who kept her dead husband in her bedside and had her adult son remove the worms every so often. Our little HIT world seems so ho-hum and mundane when you compare it to such “real world” happenings.

Inga’s listening.

News 8/3/07

From The PACS Designer: “Re: networks. TPD was perusing the computer network terrain looking for what’s new and possible as we increase connectivity across the  globe. Most of us are very familiar with Ethernet (created originally by Xerox and still going strong) as well as TCP/IP (Transmission Control Protocol/Internet Protocol). Well, there are some new networks brewing and they are called ‘Public Next Generation Network’, or NGN, and ‘Next Generation Corporate Network’ or NGCN. They have come about because of the demand for more security across the entire communications chain and we’ll be hearing more about them as we go forward. Link [warning: PDF].”

From Doc McGee: “Re: Misys. They have recruited Cory Eaves as EVP, CTO & CIO. His responsibilities will be to lead all things IT, internal and in product strategy and development. He held a similar position at ERP company SSA Global, which was buying struggling ERP companies left and right, not sunsetting any products, and leveraging maintenance revenue streams. That company’s vision was to bring the software together on two platforms and slowly raise maintenance fees and add capabilities to entice customers to upgrade. Cory knows his stuff and is pretty adept at navigating the often choppy waters between various product factions/groups in an organization as well as working with customers. He may be just what Misys needs right now to right this listing ship.”

From Anonymous Fan: “Re: athenahealth. Jonathan Bush and athenahealth are the cover story in this month’s Inc Magazine – regarding fun, their unique culture, how it is good for customers and business, and how he goes about managing his troops.Here is another link to him in a batman outfit and talking about some of the cool stuff the folks there do and how he connects fun to purpose.” The issue is on fun in the workplace. I was glad to see the mag add this caveat: “But don’t buy that karaoke machine yet. The common practice of treating sick cultures with a fun-graft–parties, silly hats, visits from Mister Softee–is insulting to employees and vaguely grotesque. For fun to thrive, meaningful work, competent management, fair compensation, and mutually respectful employees are table stakes. If you lack any of those, start there. Once the bread’s in place, come back and we’ll talk circuses.” Well said. I’ve worked in near-slave camp IT environments with carefully designated fun events prescribed by our little Hitler, sort of like Hawaiian Shirt Friday in Office Space, where a lobotomized corporate penguin passionlessly tries to connect (like Bill Lumbergh did) with the oppressed masses who yearn to cause him pain: “Oh, and remember, next Friday is Hawaiian shirt day, so, you know, if you want to, go ahead and wear a Hawaiian shirt and jeans.” There’s nothing more depressing than brain-dead galley slaves pretending to be festive while gobbling down cheap, cold pizza while dolled up in jollitywear and muttering obscenities about the clueless management team who thought their loyalty could be bought cheap.

From Scot Silverstein: “Re: Siemens. The Siemens cardiology system team I met in Germany were quite competent and ‘got it’ regarding what was needed. I’ve since found out those people are ‘no longer with the company’ and was told that part of the problems with the Soarian product was due to their influence. I rather think the problems were not the result of rigorous German engineering, but American IT practices.” And speaking of Scot, he had as good a time as I did ripping Intel’s Craig Barrett for his “my horses have EMRs” statement. Actually, he worked harder at it: he even composed new lyrics to the theme from Mr. Ed.

From Mike Kirby: “Re: CNMC. Kelly Styles, CIO of Children’s National Medical Center in DC, has ‘resigned to pursue other opportunities.’ Last day will be at the end of August.”

Marc Holland of Health Industry Insights dropped me a line about UPMC’s virtualization project, for which his company is providing validation services. He agrees with Art Vandelay that healthcare is two years’ behind other industries on virtualization. UPMC is projecting huge cost savings, although application vendors aren’t necessarily sharing their enthusiasm. One of their big ones (I mention them here a lot) was asked to quote hardware for rolling out an application to additional UPMC sites. They called for 40 servers at a $500,000 price. UPMC’s engineers estimated they could use virtualization to cut the hardware back to six servers for $6,500. The vendor refused to warranty that configuration, although they eventually agreed to four times the horsepower that UPMC recommended: 13 servers at around $250,000. Now assuming UPMC was right initially (I’d bet on them), their configuration was 98.7% less expensive, not to mention the future savings in maintenance, electricity, and software. Did that get your attention like it did mine?

Last chance to get this weekend’s inaugural Brev+IT newsletter. Sign up to your right. Judging from the number of signups, lots of folks are looking forward to it. Thanks, as usual, for the support. It’s not like I need the extra work, but it should be fun.

I got lots of interest in the reader’s request for a job description for Manager of Cardiovascular Informatics, all of it from folks who want a copy if I get one (which I haven’t so far). If you have one, several of us would apparently appreciate your sending it to me. The Rumor Report to your right will accept attachments, so use that if you’d rather.

Modern Healthcare reports that Suzanne Delblanco has resigned as CEO of Leapfrog Group, effective this fall. Since their ill-advised “CPOE or bust” stance made them initially threatening but ultimately irrelevant, you have to wonder where they go from here. They haven’t been in their heyday for years, but even in just the past two, their member count has dropped by 57%, according to current and archived versions of their web page. Most of their HIT vendor members bailed. Federal records show she was paid $179K, hardly generous by DC standards, although at just 39, I’m sure she has big paydays ahead.

At least this takes attention away from HealthConnect: a Kaiser Permanente surgeon is charged with intentionally killing a disabled patient with drugs in order to harvest his organs for transplant. Hootan Roozrokh, MD, quoted on his Kaiser web page as saying “I THRIVE by endeavoring to practice good karma,” faces eight years in prison (that’s all?)

The CEO of a hospital pricing company argues that ambulatory EMRs don’t make sense unless providers are paid fixed prices for quality. “Do we really expect that improvements in these processes will result in a cost justification for an EMR, or more globally, an improvement in the cost/quality profile of care for the country? If the entire country implemented EMRs overnight, would we see significant overall improvement in healthcare productivity, efficiency, quality and customer service?”

An Eclipsys shareholder is suing 20 past and present Eclipsys officers, claiming he and other shareholders were defrauded by option back-dating, insider trading, and falsified financial reports. I reported in May that the company said it had found evidence of back-dating, but claimed it was done by executives who left in 2006 (that’s still a corporate problem, it seems to me, but they didn’t seem to be worried when they said that). The shareholder submitted a lengthy list of trades and dates, claiming that the bigwigs enjoyed a 196% return on their options while regular shareholders lost 29% in the same period. Named: Cooper, Dipierro, Rudish, Wilson, Fife, Eckert, Coletti, Copple, Deady, Gomez, Etue, Hall, Patton, and Risenhoover (those are the ones I know, but there were a few more).

Speaking of Eclipsys, they announce Q2 numbers: revenue up 16%, EPS $0.11 vs. $0.03. Shares closed at $23.61 Wednesday, easily blowing through the 52-week high of $22.92.

Vince Ciotti sent over the 20th anniversary issue of the H.I.S. Professionals newsletter. Bob Pagnotta, Karl Sydor, and Vince started the company in 1987. “There are few companies in the healthcare IT industry, whether vendor or consulting, that have lasted 20 years, with all of the Big Eight consultants having fallen by the wayside along with countless other start-ups and ’boutique’ firms. What is equally amazing is that most of the firm’s original consultants are still active with the firm after 15 or more years.” They named their best hospital clients: Johns Hopkins, Meridian Health, and Sisters of Saint Francis. I was a client many years ago (Vince doesn’t know that since I’m anonymous, and now I know I wasn’t among their favorites) and they did a good job.

Former Cerner guy John Thompson lands as CEO of an ad software company.

Iowa Health System chooses Allscripts for ED software.

AMICAS Q2 numbers: revenue flat, EPS -$.01. vs. $0.01.

Rollout of the UK’s military EMR system begins. DmicP will eventually connect to the NHS system.

The trade group for state government CIOs says they should get more involved in RHIOs and NHIN.

Robert Goldstein, formerly of MDG Medical, joins Tennessee’s Shared Health RHIO as COO.

Talk to me.

CCHIT has so far added six vendors that have passed its 2007 ambulatory EMR certification criteria:

• Community Computer Service (MEDENT 17) 7/11/2007
• e-MDs, Inc. (e-MDs Solution Series 6.1.2) 7/18/2007
• Greenway Medical Technologies (PrimeSuite 2007 R2) 6/22/2007
• McKesson Provider Technologies (Practice Partner 9.2.1) 7/17/2007
• NextGen Healthcare Information Systems, Inc. (NextGen EMR 5.4.29) 6/25/2007
• Purkinje (CareSeries EHR 2.0) 7/27/2007

Vendors must pass 100% of the functionality, security, and interoperability requirements. The requirements are comprehensive – the functionality requirements alone run 46 pages. I expect many vendors to have a tough time getting certified. Will the market demand certified solutions when a doctor can be efficient and paperless using systems that don’t meet all the requirements?

Eclipsys signs a couple of new contracts. The University of Pennsylvania Health System (UPHS) extends their current agreement, adding pharmacy, med admin, KBC, and content from Zynx. Bayshore Community Hospital of Holmdel, NJ will implement patient financials, access management, and Sunrise Clinical Manager.

A reader had reported that customers weren’t able to get through to Sage. So far, I have sent an e-mail to Sage’s general inquiries e-mail (no response), plus attempted to call John Schoutsen, who is listed on the Web site as the company’s media and investment relations contact. Perhaps both the webmaster and Mr. Schoutsen were laid off, because the listed number is no longer working.

MED3000 acquires Pathology Service Associates (SC), which offers pathology revenue cycle management and practice management and marketing services. It has over 75 practice customers in 27 states, representing 400 pathologists.

Health Affairs publishes a “retrospective” titled “Lessons Learned from the Santa Barbara Project and Their Implications for Health Information Exchange.” Some conclusions are obvious: privacy should be addressed early; local support (especially financial) is critical; and implementation should be staged instead of big bang. “Initially, the vendor erred in its assessment that the technology needed to implement the Care Data Exchange (CDE) already existed in the market. Second, the vendor’s subsequent development and implementation of its own technology was slow and did not adequately define users’ functional requirements, which necessitated redesign and redevelopment of important functionality. Last, poor documentation and insufficient testing of the data interfaces meant that many of them had to be reworked, introducing further delays. In all, a development project scheduled to take three years took six; unfortunately, the boldess of the vision was not matched by a focused and efficient software development effort.” And thus, goodbye Santa Barbara, David Brailer, and CareScience; hello CHCF, Perot, and Medicity.

Inga’s listening.

News 8/1/07

From INVISIONforever: “Re: Soarian. I checked the Siemens website to see what it was saying about Soarian. Soarian Financials is no longer being touted as a solution for hospital and MD billing. Is this an error or a reflection of a diminished goal? Also, I was surprised to see Soarian Scheduling listed as a revenue cycle solution — it doesn’t even have an insurance master. Under Soarian Departmental Systems, only Cardiology is listed. If you compare this with their promises four years ago, the disparity is huge.” Speaking of Soarian financials, guess who’s just signed for them: Partners (!) They’ll implement scheduling, decision support, document management, community access, and payor connectivity. John Glaser had mentioned in an Inside Healthcare Computing interview that he had a big Siemens revenue cycle project upcoming and some SOA initiatives, but this caught me off guard. Certainly it’s a much-needed boost for Siemens, assuming that their stuff works, anyway.

From Hrundi V. Bakshi: “Re: Lawson. The Lawson project at Mayo was overrun and under functional. Many physicians are complaining. They can’t tell a consult/revisit/new patient from one encounter to another, much less from one facility charge to another. They can’t reconcile medicare patients from one facility to another. It’s often taking physicians 12-25 minutes per encounter to do documentation. The non-MD in charge doesn’t seem to ask doctors what makes sense. Mayo’s IT/Finance strategy needs some serious updating in personnel, vision, and education. They’re aptly set to be the laggard of adoption and questionable due diligence.”

From Molly Clutterbuck: “Re: Cisco and AHA. It’s not objective based on performance, so what’s it based on? Cisco is getting their clocks cleaned in healthcare by better performing vendors. First they bought a HIMSS user group, now they’ve paid for AHA’s ‘recommendation’. Those involved need to get off the speakers’ tour long enough to look at what’s happening with Cisco in wireless. I never knew the AHA to be all that interested in IT. Where have they been all these years?”

From Venny: “Re: Craig Barrett’s horses. Damn the EMR. To boost Intel, he needs to market chips to his four-legged friends. Who knew horses could read e-mails? Are cow chips next?”

From Bernard Stein: “Re: Misys. You are slow on the Misys news. More high level departures.” Maybe my former sources aren’t there any more since nobody’s spreading a little rumor love HIStalk’s way. I’ve not heard anything about exodi. But, Vern Davenport is hinting at acquisitions and says the realignment is 85% done. He agrees with boss Mike Lawrie (always a good idea) that the company’s healthcare “performance remains poor”.

July will be another record HIStalk month. So far: 51,416 visits, 88,156 page views (that doesn’t count RSS readers). Both measures doubled in the past year and trended highly up later in the month. And for that, I thank you and HIStalk’s sponsors.

I should also mention Brev+IT, the weekly e-mail newsletter that starts this weekend. Now about the name: I’m merciless when somebody makes a lame pun involving the letters IT, but it fit so well in this case that I’m willing to humbly accept the inevitable scorn. The main message I wanted to get across is that it will be highly concise, covering only the five most important stories of the week, and with background information and opinion to put it into context (thus the name, which I hope you’ll pronounce “brevity.” Get it? Or is that “Get IT”?) HIStalk is for industry lifers who love the insider stuff, while Brev+IT will get executives up to speed in minutes. See the sample. You’ll notice one tiny spot for a sponsor text ad, which I’ll most likely offer to existing Platinum sponsors at no extra charge. There’s a sign-up form to your right (on HIStalk2 only for now until my HTML guy gets it prettied up). Lots of folks are signing up already, so maybe it’s redundant for me to invite you to do the same.

The Wall Street Journal quotes Microsoft as saying it’s expanding its healthcare efforts: 20 new employees stateside (doctors and other clinicians) and 30 in China (developers). The healthcare group is supposedly given free rein as one of a handful of areas in which MSFT sees big potential.

A long-time reader is in need of a job description for Manager of Cardiovascular Informatics. If you have one, please shoot it to me. Thanks.

Bankrupt Bayonne Medical Center (NJ) finds a Santa Claus willing to pay for a new EMR system: you. Or more specifically, your Federal tax dollars.

Stanford University will offer AMIA’s 10×10 informatics program.

Rhode Island will create a statewide Health Information Exchange, with EDS as the primary contractor and InterSystems providing its HealthShare platform.

Talk to me.

TPD or Mr. HIStalk – any chance you can interview someone at UPMC about their lessons learned from virtualization? The early information is hitting the usual magazines, but it is a little sanitized for my taste. [Inga is working on that, Art. Good idea.]

Virtualization is the only way to get close to the necessary efficiency with the limitations of most of our cottage industry’s vendors. Even getting them to accept virtualization is a tough sell. But, even if you use it only for development purposes, it is cost effective. Less hardware, you use it only when you need it, and you have fewer physical server instances to patch.

For those of you who can’t do or sell anything without a maturity model, here is a first cut we can iterate as an industry. Who says we are not innovative?

Level 1
Can you help me spell that? I could heat a homeless shelter in Alaska from the number of servers (mostly Windows and Intel) I have in the data center.

Level 2
I am running VMWare for my developers on the PCs to test the five different versions of Windows clients on eight different PC hardware configurations we have out there. AND I approached my 300 vendors, of which 20 knew what I was talking about, five said they’d consider it if we upgraded to a current version from the one we run that’s four releases out-of-date, three said OK and they’d have their top tech guru contact me (that was seven months ago), two said they’d have to report me to their manager for using bad language, and one said they’d do it if we’d pay a higher maintenance fee.

Level 3
Just doing it without vendor blessing for all those fine two-tier, Windows server-based development servers. AND virtualizing tape back-up and storage (damn, TPD – you’re already to Level 3).

Level 4
After wasting five man-years of effort, outsourcing it to someone else and making it their problem, while paying too much for the service.

Level 5
Getting your ERP vendor to virtualize some of their 20 servers, storage, and tape devices. Come on now, you thought that we can even talk about a healthcare vendor doing this for another five years? The rest of the world has two years’ of experience on us right now.

Monday Morning Update 7/30/07

From Claude LaMont: “Re: Acermed. They sure appear to have closed up shop. A physician on our medical staff was teed up for hardware install this week. Tech never showed up. Doc called sales guy at home, only to be told that company told him on 7/20 that company had folded and he was terminated. Doc is out a bunch of cash for hardware he cannot use. Nice of the vendor to call, isn’t it?” So much for the idea that CCHIT-certified products are less risky for buyers. Neither, apparently, are those applications that are highly rated by self-proclaimed futurist Mark Anderson of AC Group, who’s taking shots broadside over at EMRUpdate for his company’s previous lofty rankings of Acermed. He posted one rebuttal: “We never had Acermed rated number 1”, but hasn’t posted again in the several days since a reader pointed out of this link or this one. One made this comment: “Mark, when you make your EMR evaluations transparent, no one will question the results. When an EMR that you highly rated goes belly up a few months after your positive rating, and you say you take into account financial viability of the company, people will wonder how good your ratings are.” Some were nastier, either accusing him of various improprieties or demanding to see his raw data (I got a few of those e-mails after we ran some comments he was nice enough to provide a few weeks back). In his defense, Anderson calls himself a futurist, not a clairvoyant, and Acermed’s problems may involve neither functionality nor financial viability. It sounds like a spat among the owners. Bad for their customers, bad for other PM/EMR vendors without a long corporate pedigree, and bad for CCHIT.

From Sore-Ian: “Re: Soarian sales. Siemens is a company known for fine German engineering. I wonder how much of the Soarian fiasco has to do with the old dysfunctional SMS culture and politics in Malvern dominating the German kultur? A conversation I had there a few months ago suggested the new people who had not been SMS’ers were looking for ways to deal with the latter’s American-big-bad-IT ways.”

From The PACS Designer: “Re: virtualization. TPD did a piece on virtualization earlier this year, but felt it was worth repeating. You will be hearing a lot about the use of virtualization to improve organizational efficiency over the next few years and some of the successes that institutions have achieved by going virtual. Yes, you will be hearing from department managers about how they need to keep their local storage solution, but with the newer software tools and faster networks, the attraction of redundant storage should make the conversion to the virtual world of storage even more palatable now. Setting up a virtual server through partitioning and making the storage archive a virtual application can save considerable amounts of money through such a venture. Also, the local storage solution can still be kept as a redundant archive to appease the manager when there is considerable resistance to change.”

From Paul Burmaster: “Re: CIOs. At the recent AHA Leadership Summit, you could pick out the CIOs by their dress. Wisdom suggests you should dress one or two levels up. Some yahoo was there in shorts, and yes, he was a CIO. I love to relax and be casual, but there’s a time to dress for success.” 

Atos Healthcare is released from its $500 million UK HNS diagnostic imaging contract after missing deadlines.

Visicu announces Q2 numbers: revenue up 21%, EPS $0.06 vs. $0.04.

McKesson announces for Q1: revenue up 5%, EPS $0.77 vs. $0.60. Technology revenue was up 49% and profits up 178%, great news for shareholders (maybe less so for customers whose payments made it possible).

Former IDX CFO Jack Kane is appointed to athenahealth’s board.

Cardinal Health pays a $35 million penalty to settle SEC charges of inflating revenue and earnings.

One recommendation of a Presidential commission reviewing the care of veterans is an online electronic medical record. Cleveland Clinic CIO Martin Harris is a member.

What the hell is the American Hospital Association doing running a for-profit subsidiary that shills vendor products to its members? “AHA Solutions, Inc. is a subsidiary of the American Hospital Association that collaborates with companies to create strategic financial, technology, regulatory, employee benefit, and insurance products and services for healthcare professionals.” I hadn’t heard about it until I noticed their ringing endorsement of Cisco, apparently rubber stamped by “a group of influential IT leaders from AHA member hospitals”. Is the implication that less-influential hospital IT professionals (i.e., unwashed rubes) can’t be trusted to make wise IT decisions? Or, that vendors who don’t pay financial tribute to AHA aren’t reliable? Let’s hope no one running a hospital IT shop is so clueless as to need AHA’s sponsor-fueled guidance. Looks like the AHA folks running the enterprise are marketing people with no stated healthcare background. Joint Commission does it, HIMSS does it, AHA does it … but that still doesn’t make it right. Non-profit hospitals should insist that those claiming to represent them be non-profit as well.

The former CEO of imaging vendor A.L.I. is having a ball with the $35 million he pocketed after McKesson bought the company in 2002.

Lawson’s Q4 numbers: revenue up 69%, EPS $0.04 vs. -$0.03, but the company cautioned on 2008 prospects.

Intel’s Craig Barrett issues more homespun sound bites about healthcare IT: “‘I have a ranch with 45 horses, and they all have electronic medical records, and they all get e-mail updates when their shots are needed,’ he told the summit.The difference is that veterinarians work in a competitive market that gives an advantage to those who adopt technology,while the health-care industry has much less incentive to change, Barrett explained in an interview afterward.” And this one: “It’s time for health care to turn from a mainframe-computer industry to a personal-computer industry.” Want to guess which one he sells chips for? Hey, do your part: buy AMD desktops and servers instead of Intel and invest the difference in charity care. That will send a message to Mr. Barrett and the horse he rode in on (even if he’s right, he’s awfully smug about it).

Talk to me.

Allscripts has been selected to provide its EMR to Urology Associates of North Texas, the country’s largest private urology group. The 50-doctor group had previously been using Penchart/Amicore and will integrate the Allscripts product with their old IDX Groupcast (Centricity Business) practice management product. Penchart/Amicore, by the way, is the product that Misys bought to develop as an ASP solution – and later dropped entirely. Though they don’t mention Misys by name, the UANT medical director was quoted as saying, “We’ve experienced what happens when vendors don’t keep up with changes in a dynamic industry.” Ouch.

Allscripts also made news last week when announcing a new initiative with Sprint to use smartphones to generate prescriptions in the exam room. Sprint will be donating up to 1,000 devices to prescribers who register for the National ePrescribing Patient Safety Iniative and activate NEPSI’s Web-based eRx NOW software.

Pioneer Medical Group of Cerritos, CA signs up with MED3000 for a five-year ASP hosted agreement for Allscripts Touchworks EMR. Pioneer Medical has over 50 providers in Los Angeles. (Either Allscripts is getting their PR machine in gear or they are in the midst of a good run.)

TriZetto names Robert G. Barbieri as the incoming CFO. Barbieri comes most recently from Lawson Software, where he served as CFO and Performance Officer. (Does his appointment mess up Mr. HIStalk’s – and Yahoo’s – theory that Misys is considering a TriZetto acquisition?)

Inga’s listening.

News 7/26/07

From Ambulatory_Vendor: “Re: Sage. Fallout from the layoffs? We’ve been receiving calls from Sage customers who have been unable to get support for weeks.” Unverified. I’ll ask Inga to follow up.

From Judith Beasley: “Re: Soarian. 2005, zero sales. 2006, zero sales. 2007, no sales yet. Soarian development costs are now over $150 million per year. Siemens can and will continue bleeding for a long time. The Susquehanna CIO is now a Siemens employee. Guess that will keep vitriolic e-mails from showing up in HIStalk.” Unverified. If anyone has facts, please elaborate.

From Mia Hottie: “Just a clarification on the Cerner product I mentioned yesterday. It’s not the Visicu-like remote monitoring product, but rather the ICU EMR that would compete with Picis or Sunrise Critical Care, for instance. Cerner announced iNet at least five years ago and, as usual, it was a toe in the water and was never been completed or well done.” Thanks.

From ExCPRUser: “Re: CPR. The combination of an archaic architecture (remember UltiMumps?) and lack of any real integration among CPOE, nursing, and rad/lab will eventually sink them.”

From RonA: “Re: QuadraMed and Vista Equity Partners. Dumb and dumber. Dumb: QuadraMed admits they can’t deliver a clinical product, throws in the towel, and buys an orphaned clinical system. HDS, Per-Se, and Misys couldn’t sell it, so what makes QD think they can? Dumber: Vista Equity Partners buys the junkyard of legacy standalone systems for $382M. Do you really think Vista Equity will invest more in these products? Both of these are feeble attempts to add value to challenged businesses and then sell it to someone even dumber.” 

From Jeff: “Re: KLAS. I think KLAS bends over backwards to provide an impartial opinion, but the key is that KLAS is only one indicator anyone should use to evaluate a vendor. There are many ways to substantiate or repute what a KLAS report might contain, so rather then ‘crying wolf’ because a vendor is not getting a great ranking, include in your opinion other factors, like making some reference calls, talking with the vendor about their vision vis-a-vis yours, and going to trade shows to see how others view the vendor. KLAS may not be perfect, but it is a great starting point for anyone.”

From Rufus: “Re: Anne Arundel. Rumor has it that Anne Arundel Medical Center (Annapolis, MD) might be ripping out Meditech and replacing it with Cerner. Their relatively new CIO is an ex-Cerner employee. Seems like a giant expense and burden. Questions: 1) true?  2) why?” Unverified.

From The Shelton Shadow: “Re: Lawson. TSS has been investigating a new possible takeover candidate who is partially in the healthcare space. That  company is Lawson Software. Don’t know yet who the suitor is, but one sign that something is up is that they have disabled their ‘Partner Network’ on their website. Only time will tell if it is one of the big players in healthcare or a private equity group.”

From Russel Ziskey: “Re: Google and the advisory team. Add Intuit to the list of organizations that maybe doesn’t get it. They announced a product over a year ago and nothing is released. Their division GM, head of bus dev/ strategy, and head of product dev are all gone. Also, the issue is not one of needing an RN to help think through what to get. The truth of the matter is that there are too many vendors from too many different angles trying to solve a need that doesn’t exist (let’s leverage our EMR, our claims data, whatever to deliver a PHR to consumers so they will manage their health and we will get $$). The reality is that consumers say they want a PHR (you have to – it’s like saying you should go to church). But, do you go every Sunday? Adoption is low, no one will pay, and standards certainly do not help – each player tries to protect their own interests.”

Cerner’s Q2 numbers: revenue up 17%, EPS $0.37 vs. $0.29, meeting expectations. The stock was down over 4% today as financial types realized that Cerner’s $26 million in NHS revenue brought along a 0% profit margin and decided the company’s expenses were too high.

OK, it’s usually pretty quiet on HIStalk in the evening. Right now, there are 51 readers on, some who’ve been there for more than 30 minutes (according to my stats service). Visitors from the past week would extrapolate to 61,889 per month, with 112,000 page views. Obviously, this will be a record month. Who knew there were 2,000 people each day who care enough about healthcare IT to hang around some anonymous guy’s blog? Join me in giving yourself a round of applause. And if you want to connect with each other, give HIStalk Discussion a spin.

University General Hospital Systems (TX) signs an exclusive agreement with Calence for network services. The press release uses the word “luxury” and “five-star” a little more than I’d like for a hospital chain, even if they are for-profit.

This ZDNet editorial is critical of the single announcement that Misys is considering an open source EMR release. “Its medical records product was already being pressured by OpenEMR, a GPL product … The current Misys Web site is terribly opaque. If Misys wants to compete effectively in open source that will have to change fast. Open source is more than free code, it’s a transparent way of doing business.”

University of Florida and IBM announce standards-based middleware to connect home monitoring devices to physician offices. “It would then be possible to buy a device off the shelf and by dialing a 1-800 phone number establish a connection between the device and one’s doctor. ‘The device itself becomes a service,’ he said.”

Cardinal Health says it has developed a better outcomes model for pay-for-performance programs. The big improvement came from adding lab data to the mix, which predicted mortality better than any other indicator, up to 67 times more important than administrative data.

FCG and InterSystems will jointly offer integration and business services to hospitals in India.

News, rumors, privaty equity investment opportunities: e-mail me.

Mr. HIStalk suggested I try to track down a CPR client to find out their perspective on the sale of the Misys CPR product to QuadraMed. I was lucky enough to catch Dave Paulson, Manager of Clinical System Support for St. Francis Health System in Tulsa, OK. He admitted he had plenty of thoughts on the whole situation and took the time to share them with our readers. Thanks, Dave!

What are your thoughts on the sale of CPR to QuadraMed?

I was very involved with the Misys leadership when they initially purchased Patient1 from Per-Se four years ago. I met with those guys and asked questions. With the Per-Se management, they had ideas but not resources to move the product forward. We were thrilled to hear what Misys management had to say. The CPR product is our lifeblood. It does everything. It’s huge for us and we need it to be continually developed and moved forward.

Misys said they realized they would do three things with regard to CPR and its development. They said, “We aren’t going to be invited to the dance unless we move from a proprietary platform to Cache’. We aren’t going to be asked to respond to RFPs because we are not Web-based. And, we have all these Sunquest lab clients now asking for the total package – they want integration with that product set.” So, those were the enhancements to be pushed by Misys.

Where Per-Se was not interested in supporting a user group for feedback, Misys was. I was very, very involved. Misys came in, devoted a lot of resources, but, about six months or a year ago, they had leadership changes and they ran out of steam when it came to focus on the CPR product. It wasn’t like some vendors that talk about things and don’t deliver. Misys just stopped talking about anything. Releases were pared down and delayed. And now, Misys has decided to be physician-focused.

We found ourselves back to where we were in the Per-Se days, but we need the vendor to move forth and advance the product. If it had been McKesson or GE or someone with products in the space to have bought CPR, it wouldn’t sit well with us. But it seems like, with QuadraMed, here is a vendor that has focus and wants to move things forward. My understanding is that the vendor staff that works on CPR is hearing good things thus far. They plan to keep people and they do have a good staff. I have not heard directly from anyone from QuadraMed yet.

I have talked to several other key CPR users in the last couple of days. We were frustrated that the CPR focus seemed to have been lost. Now people are cautiously optimistic that this is a good thing. This vendor gives us more reason to feel at ease than others.

Has the product been stable for you?

I think the product itself is stable. The one thing we really saw Misys bring to the table was improved quality of code. It just really became an issue of, “When will the next release with functionality that we want become available?” I assume that the same folks that have been working with us for the last eight years will continue and we won’t start getting support from a group that doesn’t know the product. That remains to be seen

When did you get your last update?

I think the last major release we took was about a year ago and they haven’t had one available since then. The next major release had been scheduled for release in August 2007, but that has been pushed back indefinitely. The next major release was planned for late 2006, then pushed to August 2007, then we were told they were pulling two major components and didn’t have a delivery date. The release is smaller and we don’t know when it will be available. You can appreciate frustration of the user community with something like that.

How fully are you using the system in nursing and ancillaries?

About as fully as it can be done. 100% of nursing staff is using it. The whole closed loop medication management process is fully online. Our Heart Hospital component is doing full CPOE and all the major ancillaries are using the medical records module. Sometimes I hear people say they need to look into getting single sign-on. I say, “What you need is one vendor.” It has worked well for us.

What is the CPOE utilization?

It is fully utilized in our Heart Hospital. We have three hospitals in Tulsa with 1,000 beds and the Heart Hospital has been our pilot.

Are orders being sent electronically from CPOE to pharmacy?

Yes. CPR does that fully. We have closed loop medication management.

Any problems with downtime or response time? Is the system solid?

Very solid. Really, no issues with down time and response time.

Have you ever considered switching to another system?

Yes, we have looked at that. We have had administrative changes and new management has asked if this is the horse we want to be on long term. You have to consider the cost to replace all that functionality. I cannot even fathom it. To try to replace full nursing documentation, all three major ancillaries … I don’t even know how you would do it. I can’t even imagine.

What are the best and worst things about CPR?

The best thing is the integrated nature and ability to view patient data from anywhere. The thing we have really needed from the vendor and which has been delayed multiple times is an enhancement to the clinical documentation toolset. We need it to provide more efficiency for nursing and physicians. We need something more EMR-like.

Secondarily, the pharmacy module needs to be updated and was to be included in the next release. The pharmacy module was one of the first modules to be ported to the Web. Our pharmacy folks are just still waiting for the changes. When I talk to people at QuadraMed, I will say those two areas need to continue to see focus.

Would you recommend CPR to others as it exists today?

Yes. Come and look at it if anyone needs to see what I just described. Cerner is going to talk about it, but we are going to show it to you.

News 7/25/07

From Meat Beat Manifesto: “Re: Misys. Misys will be announcing a sales leader to take over the Misys Connect product. He is a former Cerner guy who has been with Misys less than a year. If they want to sell more EMR, they need to give Connect away or sell it as a subscription with a low monthly cost. Similar players (Healthvision and their competitors) already have a foothold, the community market is soft, and RHIOs are broke. All these things will make it hard to sell Connect like in the good old days (for $250K and up). By the way, conference calls are being held today to brief sales teams on the recent changes. Everyone had a fit when things started popping up in HIStalk.”

From Nick Cave: “Re: Sunquest. Who gets the name? Lab had it first so, it should go to Vista. The name is worth something since it used to be a great company to work for and to be a client of.”

From Oldtime Sunquest: “Re: Sunquest. Now the lab, rad, and pharm business can move forward and not back. Now the profits from lab can be reinvested in lab. The new owners know software and there is still a place for growth in the diagnostic software market. The software is still good, even though Misys tried to run it into the ground. It feels good to call them Sunquest once again. Sid must have a smile on his face today. I know the users and employees do. I agree that GE should look out.”

From Terence Hogan: “Re: Misys. Keith Hagen actually came from Sunquest first, then moved to Misys Transaction Services to be groomed for bigger and better things (like being CEO of QuadraMed, ha!) Lab and rad are good products, but weren’t selling well due to outdated technology. CPR was indeed hard to install and, although CPOE was very strong, the integration that was supposed to happen never really did.”

From Misys User: “Re: CPR. QuadraMed needs to get rid of the CPR Client Services management. The few users who attended the recent conference agreed that the last twelve months have been the worst in the history of the CPR product. We aren’t going to give QuadraMed as much time as Misys to make it work.”

From MrMisyster: “Re: Sunquest. There is very little question that the original Sunquest group in Tucson have reason for celebration today. Misys did nothing for them but take the profits and throw them away on a failing acute care business comprised of every lackluster product Tom Skelton could buy. The real question is who will lead this group since all executives are in Raleigh (Atkin?)  Also, what about infrastructure: marketing, HR, and a few others that all got compressed into the milieu that was Misys? What a six-year mess, but at least there’s some hope for the future of the Tucson group.”

From Enumerator_of_Beans: “Re: Misys. Looks like what’s left of Misys Healthcare is running about a 13% operating margin. Not the loss-maker some think, but hardly a punchy, software-type margin, either. For the $400 million, I would expect them to acquire an ASP-based physician product and save some cash for share buybacks to keep shareholders happy for the short term since the dispositions will negatively impact earnings unless they do something sensible with the proceeds.”

From Mia Hottie: “Re: Cerner. The iNet monitoring system that competes with Visicu is rumored to be at risk of being de-installed in a handful of hospitals.”

From Lane Kimchee: “Re: Google. Google announced a bunch of healthcare advisors, mostly big-name talking heads and luminaries, and not a single RN, much less anyone who’s ever actually taken care of a patient. Is there another industry where the #1 user group would be ignored? Google may just be another clueless big company trying to get into healthcare like those that failed before them: Amicore (IBM, Pfizer, and Microsoft), Dossia, and Cisco.”

I missed this: the interface engine part of Quovadx is bought by – who else? – a private equity firm. Cloverleaf will live on under the Quovadx company name, but the company will be moved to Dallas under new owners Battery Ventures, who also put their CEO at the helm.

If you had problems reading HIStalk on Monday or Tuesday, I’ll apologize yet again. I knew the server was going to get pounded when I noticed that over 100 readers were on during the early hours of both days (I can only see the first 100, so I only know it was some number bigger than that). It didn’t drop below for long on either day (mostly due to a crapload of stock analysts reading up, judging from incoming addresses). HIStalk was the only source of full coverage of both the Misys and Picis events (sleep-in reporters don’t like working Sunday afternoons and the wee hours of Tuesday morning like I did, even though I have another day job and they don’t).

Anyway, as Inga pointed out when I bemoaned possible site slowdowns, the user volume and feedback seem to indicate that HIStalk has become the primary source of industry news, both breaking and routine. For that, we say thanks. We really do work hard to get information, thoughtful opinion, and industry reaction in front of you. It’s easy for me to lose sight of that fact since all I see is a keyboard in an empty room for several hours a day, never talking to anyone about HIStalk or acknowledging that I’m behind it. I really appreciate the support of readers and sponsors. It wasn’t nearly as much fun with I had neither. As several folks have noticed, we’ll get our 1 millionth visit to HIStalk soon. Nobody wants HIMSS Hummers these days, so maybe I can get one cheap and give it away.

If you read HIStalk on the HIStalk2 site (with the pipe-smoking doc), you can click Archives at the top of the page to find your way around.

Cerner is speculated as a possible bidder for a big Australian hospital IT project.

HLTH Corp. (the stupid name WebMD chose voluntarily) and Emdeon Practice Services are suing nine insurance companies to force them to pay the estimated $58 million legal bills of their nine indicted former officers and directors. I bet it didn’t even cost that much to keep OJ golfing.

New CIO: Tom Pagano, Carondelet Health (MO), moving over from Truman Medical Centers. Boy, the paper really botched the name of the HIMSS chapter of which he was president.

HITSP seeks public opinion on its next recommendations to AHIC: emergency responder EHR specs, security and privacy, quality use case, and consumer information access case.

Discuss today’s news here: Misys, Picis, or even non-rhyming newsmakers.

Impress me with your knowledge or speculation: e-mail me or use the Rumor Report to your right to spill secrets or educated opinion. We like both.

Last week, Mr. HIStalk mentioned that Acermed was perhaps closing its doors. I was able to connect with Acermed’s Anoush Tabriz in Client Relations. While Tabriz wanted to make it clear that AcerMed is continuing to provide clients with support with their “skeletal staff,” the rest of our (short) conversation had several “no comments”. So officially no comment as to what is going on with the company, why the reduced staff, whether or not they are still selling new products, if the situation is temporary, etc.

Millennium Research Group announces results of a study that nearly 18% of physicians had an EMR in 2006 and the number is expected to rise to over 30% by 2011. System costs and the disruption of implementing a new process are the two biggest barriers today. To increase acceptance vendors are introducing more streamlined versions of their products. While these adoption numbers seem lower than some I have seen, I am inclined to believe they are fairly accurate.

Compare that to the recent AAFP survey that indicated that half of doctors that responded to a survey said they had either fully implemented an EMR (37%) or were in the process of implementing (13%). That suggests that either family practice docs are more advanced than other specialties, or, that the study was not as scientific as it could be (since it was based on respondents versus a random sample.)

Anyway, all interesting data points, but in 2005 some “experts” predicted that by now 24% of the docs would be using EMR. And about a year ago, the predictions suggested that by the end of 2007 25% of the 1-2 doctor groups would have EMR and as many as 78% in the larger practices. There are obviously varying interpretations of what it means to utilize an EMR and that likely lends to a wide range in the percentages. Bottom line – regardless of whose survey you look at, the market is still pretty unsaturated. Once there are more easy to use products and possibly hospital or government subsidies, the market will see some rapid growth.

eClinicalWorks was chosen by the DC Primary Care Assocociation (DCPCA) to provide EMR/PM solutions for their six community health centers. Four additional centers may be added in the future. No mention of the size fo the deal.

Not sure I have anything to add to all the comments regarding Misys. I actually have had fun reading what readers have had to say. Guess my only thought is that at one time Misys (at least the old Medic piece) was considered the Mercedes product in the industry. The good thing about an old Mercedes is that, even with age, they tend to still work. The problem with an old Mercedes is that there are a lot of other options that do the job as well or better and happen to be sexier and cheaper. I am sure that there are still a number of great employees left and I hope Misys will take care of them.

A MED3000 client forwarded us a letter that was apparently sent to all their clients. Chairman and CEO Pat Hampson announced the finalization of the InteGreat acquisition and the “vision” for how it was to become a “critical component” of MED3000’s and their clients’ success. There is acknowledgement that they are large users of multiple vendors’ software (Misys, GE, Sage, Allscripts, etc.) but Hampson point outs that they have “only limited influence over the direction of their software development.”  MED3000 plans to continue to expand development of IC-Chart and IC-MyHealthRecord. A cynic (like Mr. HIStalk) might suggest that clients watch out for a push to move everyone over to the InteGreat products.  However, if you take the four-page letter at face value, Hampson is trying to enforce the idea that they will continue serve the needs of their 9,500 physicians, including those on other systems, while at the same time channeling additional efforts to promote the InteGreat products. As Hampson rightly says, “the proof is in the pudding”.

Chat up Inga.

Picis to Acquire LYNX Medical Systems, Will Announce Goldman Sachs Equity Investment of $155 Million

High-acuity hospital information systems vendor Picis of Wakefield, MA will announce later today its intended acquisition of LYNX Medical Systems of Bellevue, WA, which markets revenue cycle management software and services for hospital emergency departments.

While terms were not disclosed, Picis President and CEO Todd Cozzens told HIStalk that Goldman, Sachs, & Co., advisor to Picis, will provide the company with a financial package worth $155 million. A portion of that investment will fund the Picis purchase of LYNX from its private equity firm owner, Francisco Partners.

Cozzens says the deal will combine the clinical expertise of Picis with the financial managment offerings of LYNX, both targeting the hospital emergency department. “LYNX Medical Systems focuses on revenue cycle management in the ED. It’s a huge revenue opportunity for hospitals. CMS [Centers for Medicare & Medicaid Services] rules in the ED are much different. There are so many areas in the food chain from patient encounter to patient disposition where charges can get lost or mis-coded. It’s a $25 to $35 per case improvement with this product, which will be even more when integrated with our clinical product.”

Picis offers perioperative and intensive care information systems in addition to its CareSuite ED PulseCheck emergency department information system, which it acquired from ibex Healthdata Systems, Inc. in August 2004. “It does for ED what we did for OR in putting anesthesia and clinical and administration together,” Cozzens told HIStalk. “We have a highly differentiated solution for these areas. It’s a big trend. It’s not good enough to just have clinical documentation and flowsheet information. You have to tie it to factors that are hard dollar, with a proven return that will stand up to scrutiny.”

The LYNX software suite includes ED and clinic modules for patient tracking, documentation, visit level assignment, and CPT and ICD-9 coding. Its health information management application provides browser-based electronic records management, remote access, and coding workflow.

“LYNX is software as a service,” Cozzens told HIStalk. “It’s a great per-click business model. The content and algorithms have been through CMS audits. If you over-code, it’s fraud, and if you under-code, it’s lost revenue. LYNX has been tried and tested with CMS. This is not software you can build in a day. It’s a great little company, a great little business, compatible with our clinical focus in ED. Picis will offer the first end-to-end solution for ED from clinicals to financials. LYNX sells to CFOs and has some great customers like Partners, Vanderbilt, Montefiore, Triad, and Yale-New Haven.”

According to Cozzens, LYNX is profitable, with revenue of over $30 million that has increased by 800% in the past four years. Its 200 employees serve 350 healthcare organizations representing over 15 million encounters. Additional LYNX offices are located in Waterloo, IA and Tampa, FL. No management or location changes are planned.

HIStalk asked Cozzens about integrating the product and company culture into Picis, which is located on the opposite coast. “We’ve been good at merging,” he told us. “It’s not like GE, where they don’t like domain experts and they bring in the plastic and lighting people. We love the domain experts and invest in them and, hopefully, they will multiply. We know this will be one of our easiest integrations. It’s easy to run companies in other locations if you have good management systems in place. Since I talked to you last, we’ve really beefed up our senior management team, people who know the enterprise software business. Big ERP went through what healthcare is going through 10 or 15 years ago. We’ve found that they’re invaluable in driving better practices and stronger management systems.”

The combined organization will service 1,350 hospitals in 19 countries, with reported annual revenues in the $125 million range.

Cozzens disclosed that Picis placed its initial public offering on hold three weeks ago so it could complete the LYNX acquisition, which had been in discussion since early spring. “It could not have happened with the IPO,” Cozzens told us. “We wanted to raise money to do this. The timing wouldn’t allow us to go out and then do the deal. There was too much space in between and it was time-sensitive. The company was going to be sold.”

Goldman’s investment eclipses the estimated $84 million the Picis IPO would have brought, Cozzens told HIStalk. “Private equity valuations aren’t too far off of public valuations. Our shareholders didn’t leave much on the table here.”

Picis will eventually continue with its IPO plans, Cozzens told us, but with the critical mass and momentum that the acquisition will provide. “We never viewed the public offering as a seminal event, just a financing event,” he said. “It was a no-brainer when we could arrange financing through strong terms, be a good deal for our shareholders and Goldman, and not be public at the same time. Critical mass will put the IPO at a different level at a higher market cap, with more analysts folowing and many different revenue streams.”

Goldman’s private equity financing makes it a major investor in Picis. According to Cozzens, the deal is Goldman’s first direct investment in healthcare IT and the largest healthcare deal in Massachusetts this year. “At $155 million, it’s nearly twice what we wanted in an IPO,” Cozzens said. “Goldman is an investor, very close to being the major shareholder.”

Goldman managing director Chris McFadden was quoted in a Picis press release. “The opportunity to invest in Picis is consistent with our long-standing desire to invest in companies with strong growth and earnings potential in healthcare. This investment underscores our belief that Picis has the strategy to meet this opportunity.”

The acquisition is expected to close later this summer.

Mr. HIStalk’s Cheap Seat, Hastily Thought Out Conclusions

• I like the deal. The only unknown is how much Picis paid. Goldman wouldn’t have put in its own money if it didn’t look good. It gives Picis a nearly unbeatable ED offering, something that no mainstream vendor can match.
• This must have been a complex set of three-way agreements to hammer out, especially with two of the parties being private equity firms.
• Picis is smartly sticking with areas in which the big boys are weak instead of trying to fight an expensive, ill-advised CPOE-and-orders ground war. Plus, revenue-related systems are back in vogue again after lots of money was wasted on unused CPOE applications.
• How did I miss LYNX? I’ve heard the name and mentioned them a few times, but really knew nothing about them.
• When Picis put its IPO on hold three weeks ago, I wrote: “Related to Picis (but written before the IPO news came out) is my editorial in this week’s Inside Healthcare Computing electronic update: ‘Private vs. Public Vendors: I’ll Take the Former,’ in which I argue that the now-trendy private equity investment is replacing IPOs as the primary way for companies to grow. I have to admit that I felt traitorous when I wrote it because Picis is my sponsor and my argument is that current customers historically have fared worse after a vendor goes public (my vendors, anyway) but now I can feel OK about it. I still have confidence in Picis and I bet there’s a positive reason they changed their IPO mind.” Score: Mr. HIStalk 1, lots of other pundits, 0. Lucky guess, I admit.
• Goldman Sachs, $155 million. Damn! No wonder Picis passed on the IPO for now. Why hamstring yourself with all the publicly traded drawbacks and expense when you can get liquidity and financing needs without opening your kimono to the world? Plus, that’s an impressive name to hang alongside your own.
• Assuming Picis sticks with Goldman for its eventual IPO, Goldman can’t weave itself too deeply into the Picis operations. While I’m sure they’ll be involved in strategic decisions, they can’t load up the Picis board and management ranks with insiders and then float the IPO.
• While Goldman will reap management fees and a cut of the profits, that at least that aligns their interests with those of Picis, i.e. they make money together or not at all.
• Francisco Partners flips LYNX after holding it for just 18 months. They just bought Dairyland Healthcare Solutions a few weeks ago, you may recall. The trend of private equity investments in the HIT industry is full steam ahead. It won’t end here, but the real question is how long those companies will sit patiently while waiting for a big payday. Will they buy and hold or slash and burn? It would be fun to know how much they made on LYNX (and how much of Goldman’s interest in Picis ownership hinged on that piece of the puzzle).
• Todd Cozzens is among the best businessmen in the industry, especially given his role as co-founder of a relatively small, privately held company. He just got a $155 million vote of confidence from the Cadillac of investment bankers and hasn’t even IPO’ed yet. Who would have guessed he’d be that much of a star after starting up a fairly unexciting niche vendor in 1994 and sticking around all these years?
• It was cool of Todd to contact me personally in advance of the announcement. I bet his marketing people thought he’d lost his mind in trusting an anonymous blogger with an embargoed story (meaning I was on the honor system not to run it before 12:01 a.m. on July 24). He also offered a potential follow-up to our interview awhile back, which I think you’d enjoy.

Misys Sells Off Sunquest, CPR, Exiting the Hospital Systems Business

Lots of Misys news to report as announcements are made in London:

• The so-called Diagnostic Information Business, i.e. Sunquest, is being sold to Vista Equity Partners for $382 million. That includes pharmacy, lab, and radiology systems.
• The Misys CPR hospital clinical system is being sold to QuadraMed for $33 million.
• Rumors are that Misys will introduce an open source, EMR-related product (along with other open source products in its banking divisions).
• Vista will try to market Misys EMR as part of the deal.
• Both new owners have agreed to support the Misys Connect strategy.
• UK rules require Misys shareholders to approve the transaction.

Thoughts

• From QuadraMed’s announcement of the CPR purchase, it appears that Quadramed’s motivation was known weaknesses in its own Affinity clinical offferings, particularly for larger hospitals: integration and CPOE.
• Misys bought CPR from Per-Se (as Patient1) for $30 million in mid-2003 and spent a lot of money ($20 million?) tinkering with its technology underpinnings. So, QuadraMed gets an even better fire-sale price than Misys got originally, although with a few more layers of accumulated tarnish. It’s now nearly 20 years old with few installations.
• Misys CPR was once a great product, but it has languished for many years under two unfocused owners.
• Current KLAS rankings: CPR # 6, but notably one notch ahead of Cerner Millennium and two above GE Centricity Enterprise (Affinity had much higher numbers, but too few installs.) Lab: a strong #2 (good job, Sunquest.) Pharmacy: mid-pack, but too few customers to score officially. Radiology: #3 of a four-horse race, but once again the last-placer was Cerner. In other words, if you believe KLAS, QuadraMed gets an instantly competitive clinical product line for $33 million.
• QuadraMed CEO Keith Hagen is familiar with both products: before becoming CEO, he was with QuadraMed and left for Misys (although he was involved in their transaction services, not software).
• One rumor is that the old Sunquest name will be revived. I like that idea.
• Misys took on 200 Per-Se employees when it bought CPR. I can’t imagine very many are left. Ramping up staff isn’t something QuadraMed has done a lot of, so that will be a challenge (as will trying to move the office from Tucson if that’s part of the plan – QuadraMed struggled with that in moving everyone to Reston a few years back.)
• Vista is the same private equity company that bought Surgical Information Systems in February 2006.

Reader Comments

“Affinity was not designed for larger, multi-facility organizations and lacked technical infrastructure to support needed enhancements. Their interfaced, acquired pharmacy product was never going to work. CPR has an excellent integrated pharmacy system and an OK lab solution. Much deeper nursing and CPOE capability. However, CPR is hard to install and most of the knowledgable staff are long gone. It needs to be configured for out-of-the-box installation.”

“I need some help, as a business-ignorant techie. Misys just sold of PLX (Pharm, Lab, Xray) to an investment firm. CPR is probably going to QuadraMed based on another rumor. What I don’t get is this: Verne keeps telling us that Hospital Systems is making money and keeping areas like Physician Systems (that he said is bleeding) afloat. Why sell off the very unit that is keeping the other units afloat? I just don’t get it.” Misys Myopia is an interesting phenomenon caused by bringing over a bunch of Medic people who never bought into the inpatient thing and just assumed their gravy train had endless track in front of it. The old, unprofitable product line wasn’t Sunquest or CPR, it was the ambulatory business, but they couldn’t see that. The cash cow has been sold for a low price to try to plug a few of many lifeboat holes. While this strategy isn’t a bad idea, they need to show far more brilliance and vision in trying to save the only remaining business than they did deciding to sell this one off.

Mr. HIStalk’s Cheap Seat, Hastily Thought Out Conclusions

• CPR was always a better product than the market acknowledged. The problem was the incompetent vendors selling, installing, and supporting it (Health Data Sciences, then Medaphis/Per-Se, then Misys). Several years ago, when I last looked side by side (casually) at all the available products (except Epic), I ranked it #1. Very nice user interface, great for physicians and nurses.
• Affinity Clinicals are pretty good and, despite technology criticisms (MUMPS and Cache’, not much different than the original CPR technology). Epic is obviously a poster child to prove it’s sellable despite the nuts and bolts. Still, QuadraMed’s purchase of Australia’s Detente Systems never really worked out – nobody does real integration via that route and McKesson is much better at convincing a gullible market to the contrary than QuadraMed ever was.
• QuadraMed paid $4 million for Detente in 2004. It paid $14 million to get Tempus Software the same year, a much better investment.
• Affinity Clinicals are best suited for small- to mid-sized hospitals, while CPR’s few customers seemed to indicate a big-hospital preference. Keith Hagen’s video statement about the announcement clearly says they’ll offer both products. That’s been tough for those who’ve tried it before – trying to merge cultures, technology, and sales is a lot harder than just hanging a new name on it.
• I don’t know how many good clinical product people are left at QuadraMed since Affinity Clinicals were doing pretty much nothing. Ditto CPR. Who’ll be involved? It had better be folks with clinical backgrounds who can come up to speed quickly.
• Misys management seemed almost openly contemptuous of the Diagnostic Information Business, but the sales announcement painted a far rosier picture, with margins of nearly 30%. Need proof they didn’t get it? How about this from the press release: “The Diagnostic Systems business has been run largely as a stand-alone operation, and therefore will experience minimal impact in day-to-day operations.” In other words, Misys was adding no value whatsoever and, most probably, actually hampering that division from succeeding due to its own corporate- and division-level bungling. And even then, it was bringing home big profit margins.
• Misys is selling the former Sunquest for slightly less than it paid: $404 million in 2001. Not much value-added there.
• Misys Connect never amounted to much and will be irrelevantly straddled across three companies. The only remaining assets of Misys Healthcare, i.e. the physician systems, will have to make it on their own with fierce competition. Divesting the other businesses will let them focus on trying to salvage that struggling product line.
• Misys finally acknowledges that, grand proclamations about its vision aside, it lacked the execution and vision to play in the hospital market. It’s first and foremost a banking software company that happens to own a troubled physician practice software division hanging on for the ride. It has finally gotten ride of one of its two unaligned albatrosses.
• QuadraMed has had its share of rough rides, too: wildly faulty acquisitions, survival without vision under Larry English, the slow and painful demise of Affinity, and what looked like a wise retrenchment into the company’s only strength: the HIM product and service market. Will the market accept their re-emergence into acute care clinical systems?
• The industry needs another strong clinical systems player, with the odds going down by the minute that a GE-retooled Carecast will be it.
• Tucson employees of Misys, as Gerald Ford said, your long national nightmare is over. Your were already an abused step-child, so it can’t get much worse. The announcements proved what everyone suspected: Misys Healthcare didn’t respect its only successful product lines and the people producing them.

Post Your Thoughts on HIStalk Discussion

Since I have to work for a living on Monday, I won’t necessarily be able to post HIStalk updates as any news breaks and to get your comments online quickly. Post here! You can bet that Misys, QuadraMed, Vista, investment analysts, and everybody else in the industry wants to know what you think.

Monday Morning Update 7/23/07

From Hamrick: “Re: Misys. Misys will announce the sale of Misys CPR to QuadraMed on Monday, July 23.” QuadraMed already has a clinical product that nobody’s buying, so I’m not sure why they’d want another one. However, since Misys was making big changes Friday (supposedly), maybe the timing was intentional if this is true.

From Wompa1: “Re: CHI. Christopher MacManus, Sr. VP of IS at Catholic Health Initiatives, has moved on.”

From Duuude: “Re: Mayo and Cerner. I’m wondering if Mayo feels left out of with Intermountain being the development partner. They used to hold IDX by the gonads when they were truly a development partner. In my experience with Mayo, even though they can be a big pain in the derriere, they did know their stuff. Even with all of that holding and pain caused by Mayo, they are worth keeping, even just for the perks of having them as a named client. When will GE take notice and stop the bleeding? If I was GE, I would be trotting out Hogan, the executive GE Healthcare board, and whatever is left of Seattle management to keep Mayo.”

From The PACS Designer: “Re: iPhone clones. TPD wants HIStalk readers to know that the iPhone is not the only choice when it comes to ‘combo phones’. The iPhone is getting all the attention, but there are other all-in-one phones to consider. There’s the RIMM Curve, the Motorola Q9, and the Helio Queen. They aren’t truly clones, but they offer more traditional functionality. I’m sure we’ll be hearing about more companies jumping on the bandwagon.”

From TwoDogMom: “Re: Mediware. What does anyone out there know about the Mediware vs IHC lawsuit?” They’re suing each other, it appears. Intermountain bought Mediware’s blood blank system in 2004 with a three-year support agreement ending June 30, 2007, with rights reverting back to Mediware on expiration. Mediware told Intermountain it wouldn’t renew the agreement, so Intermountain is arguing it should be able to keep using the system. Intermountain had already sued Mediware in April for breach of contract. An unhappy, high-profile customer is just the icing Mediware’s cake needs.

Rumor: physician practice vendor AcerMED has abruptly ceased operations.

Jon Philips of Healthcare Growth Partners asked me to clarify that the number of deals I quoted the other day was of the principals, not the company itself. They’re doing great, of course, but he didn’t want anyone to think they were trying to mislead.

iSoft couldn’t even get a date a few weeks ago, now it has two marriage proposals: Germany’s CompuGroup trumps IBA’s bid with a $329 million cash offer of its own, a 19% premium to IBA’s offer that iSoft’s management is urging shareholders to accept. Part of their offer: CompuGroup will sell off the NPfIT business to CSC and both companies will own the Lorenzo product line.

Mediware shuts down its OR business line and fires 20 employees under the new COO. They announce their focus on so-called closed loop systems. Well, good luck with that. That’s bad news for GE: Mediware’s exit frees up the dead-last KLAS surgery spot for Centricity Perioperative. Doh!

I didn’t hear first-hand about the scheduled Misys bloodletting on Friday. Did it happen? Maybe you’ll be offered another position, like this one: Misys needs a PR specialist. Desperately, some might say. Guess the layoffs freed up some salary dollars.

CPSI announces Q2 results: revenue down 3.5%, EPS $0.31 vs. $0.38, falling short of expectations.

Emergin sent over their latest newsletter. It includes an Emory neuroscience CCU case study on alarm integration.

My editorial this week in Inside Healthcare Computing: “‘Best’, ‘Most Wired’, and Other Hospital Surveys: Good for Selling Stuff and Not Much Else.” I won’t spoil the suspense by revealing my opinion.

Speaking of the Most Wired BS, even H&HN had to punt when it came to the obvious: “The analysis shows an association between IT adoption and key quality measures, but association is not causality.” That wasn’t on the cover, of course. Those paying for the survey: the magazine, Accenture, AHA, CHIME, and McKesson. All but AHA have a vested interested in encouraging the “buy more stuff” bandwagon. Just another meaningless award given to customers by their vendors.

eScription announces the release of a new version of its speech recognition software, AutoScript. They casually mention in the second paragraph that it’s twice as fast at processing dictation as the prior version. I’m thinking there was little debate about whether that justified a new version number.

El Camino Hospital creates a CMIO position and recruites Eric Pifer from the University of Pennsylvania Health System.

Charles Wagner leaves IBM/Healthlink to become SVP of professional services for Eclipsys.

Discuss today’s news here. Lots of you have registered for HIStalk Discussion, so why not use it? I rented the hall and brought the band, but I can’t make you dance.

E-mail me. But only if you want to.

News 7/20/07

From Joey Cheesesteak: “Re: CHOP. Regarding your 7/13 item: their outage was due to loss of power in the Primary Data Center. Operations did not shift to the remote data center because the SAN was not configured to cooperate. This outage was not an Epic problem (not to say that the Epic implementation is going smoothly). Also, three of the four CIO direct reports have left recently. One moved to a different department within the hospital and the other two have found other employment. The CIO will hit a five-year anniversary in January 2008. What’s the average tenure of a CIO after an Epic implementation?”

From Dr. Mark Bellows: “Re: Cerner. Look for Cerner and Mayo to make a huge ‘Kaiser-like’ announcement soon. Also, Clarian is looking for an out in their Cerner contract (it’s not looking good AT ALL over there …) I have always enjoyed reading your blog and have laughed at times when rumors are stated about Cerner well before they have made them public. You and your readers have been on the nose 90% of the time with most things.” Unverified, but, from what seems to be a good source.

From Lance Le Gault: “Re: Cerner. The funny talk around here is that Cerner would take any temp, put ’em in a suit, and say, ‘We are sending you a VP.’ Cerner losing 20 of those VPs means very little.”

From Nancy Greenly: “Re: Cerner. It’s obvious that Neal is putting the company up for sale with all the cost-cutting and moving everything to centrally-based KC for an easier transition. Sales are slow, but the stock price keeps going up. The Indian outsourcing is in place and a European presence makes them a ‘global’ company. I’d bet a non-current player picks them up within three years.”

From Sean Murphy: “Re: non-competes. That was nice of Mike Etue to ride out his non-compete from the other folks in Malvern on someone else’s dime and then jump ship a few months after it expired. Wow, that Epic document is brutal. Too bad the federal government says that you can’t prevent someone from earning a living. It would never stand up a real court. Do we have any legal readers that could lend an opinion of the language?” I asked a non-compete attorney I ran across to chime in, but he hasn’t replied so far. The bottom line is that non-competes are almost always unenforceable, but unless you take the company to court to obtain a summary judgment (kind of like a class action suit), each employee has to spend their own money fighting retainer lawyers in court. That’s assuming you can even get a job offer, that is. You’d be proven right, but not before you went broke. The threat alone is enough to tilt the landscape to the company’s side.

If you’ve had problems accessing HIStalk recently, my apologies. It’s hard to believe, but even after my big upgrade in May, the site’s server red-lined on memory this week and killed the Apache service several times (that causes “Page Not Found” errors). Inga tells me some of the notification e-mails may not have gone out either, although they looked OK on the server. I thought the May upgrade was overkill that would guarantee enough horsepower for years. Well, two months later, a punishing number of HIStalk hits maxed it out again, so I’ve doubled the memory and had extra bandwidth allocated. I’m not complaining – it’s a great problem to have.

The LA Times writes up Prem Reddy MD, a cardiologist turned for-profit hospital entrepreneur who claims to be worth $300 million. He tools around in a $1.4 million helicopter and has a 15,000 square foot mansion with gold-plated toilets formerly owned by Roy Rogers. How he does it: he buys struggling community hospitals, cancels their insurance contracts, dumps services that don’t have a big profit, (allegedly) turns away patients without insurance, and (allegedly) lets quality slip. He does that Bob Dole thing in referring to himself in the worshipful third person: “There isn’t anybody like Prem Reddy that can face so many challenges in the medical field.” I mentioned him two years ago, when his brother, a CEO of one of his hospitals, fired the CNO and HR director after they claimed he (Prem) was drinking while working in the ED and using a triage system based on insurance coverage.

Reminder: use the sign-up to your right to get e-mail updates when I write something new. I notice that list is up to 527 subscribers in a very short time, plus the 1,843 on the “old” e-mail list.

Jason Baker has joined Healthcare Growth Partners as Managing Director. He comes from Cerner, where he was head of corporate development (high-level strategic stuff like investments and acquisitions, not programming-type development.) I didn’t realize that Healthcare Growth Partners has been involved with over 100 deals worth over $1.5 billion in just two years. Nice.

Some Misys folks have been asking about severance (wonder why?) Typical for the company is supposedly one week per year of service. They also don’t go after non-competes too hard, rumor has it, which is to their credit when folks leave under something other than their own volition.

Off-hours teleradiology provider NightHawk Radiology buys Midwest Physician Services, a radiology business process company, and another off-hours teleradiology company. Total price: $62.5 million cash. They’re creating NightHawk Business Services, which will offer services for revenue cycle, HR, transcription, and other back-office stuff for radiology practices.

Someone who should know tells me that Cerner is indeed slimming down implementation teams as Bedrock gets built out, running implementations from the KC Accelerated Solutions Center. Apparently it really does work and they won’t need virtual implementation staff any more. Another tidbit: supposedly Paul Black left because he didn’t like how the customer-facing employees are being treated (accessibility to client, work-life balance, etc.). Unverified, of course.

Comanche County Memorial Hospital (OK) signs a $13 million deal with McKesson for Horizon Clinicals.

The Most Wired list is out. I don’t care, so I won’t mention it or the winners. It’s meaningless, was created by vendors solely to encourage the “buy more IT” bandwagon effect, and keeps going only because the “winners” pretend it shows how excellent they are. I’ve worked for winners and all those I spoke to laughed about it behind closed doors, but it’s better to win than not, they always figured (harmless CIO resume expansion and hospital chest-puffing).

Bizarre lawsuit: a nurse changing clothes in a Kentucky hospital’s anesthesia office finds a hidden camera in the ceiling tiles. She says the hospital then tried to throw her and her surgeon husband off the property for trashing the camera, also threatening to revoke their privileges. Another nurse was fired. The hospital says the camera was there to monitor controlled substances that are kept in the office and that the women should have used unmonitored areas set aside for changing. The nurses are suing for voyeurism.

News, rumors, changing room video: e-mail me.

News 7/18/07

From Inside Outsider: “Re: heart images on iPhone. TPD will be happy to see this.” Web-based image management company Heart Imaging Technologies is offering iPhone access to their browser-based imaging application. Sample images here. Looks cool.

From Malvern: “Re: Misys. Mike Etue is the new Senior VP of Sales for Misys. Mike Etue resigned five days before the Eclipsys ‘announcement'”. Deady convinced Mike to hold off for a week, then claimed he fired Mike.”

From Hatchet Guy: “Re: Cerner and Paul Black. Now Mike Valentine has nobody to blame. Pay close to the number of employees in KC. Compare the number they announce on the earnings call to the annual report. It is shrinking fast. Instead of severance, negative press, and stock reaction, they told a large group of implementation folks they have to move to or stay in KC, knowing that will cause turnover. That’s the plan – that Bedrock will install Cerner’s app without implementation resources needed. In the last 45 days, more than 20 VPs have left the company. One more thing to watch in the coming days in KC: the FDA.” Unverified, as I always add, so if you can verify or contradict, e-mail me.

From Wayne Frake: “Re: Lawson. Is Lawson looking for something new to buy and/or merge with? I saw an email from Debes to Messing. Messing’s response was no interest.”

Epic Escapee sent me a copy of the non-compete agreement he or she signed a few years back. It is quite broad, probably not enforcable legally. Some terms: (a) you will “neither accept nor conduct any other business or professional activities while employed by Epic”; (b) for two years after leaving, you can’t contact any Epic customer in a sales capacity; (c) you can’t have anything to do with companies it has defined as competitors: Allscripts, Cerner, Eclipsys, GE Medical, Healthvision, IDX, McKesson, Misys, NextGen, Per Se, SMS, or WebMD for two years after you leave; (d) you can’t join a business or start your own during that two years if it competes with Epic; (e) for two years, you won’t try to convince any Epic employee to quit; (e) for three years after employment or six months after leaving, whichever comes first, you won’t work for any Epic customer or prospect, except in a role not involving software. It’s pretty smothering, but on the other hand, you don’t have to sign it. You won’t get the job, but maybe that’s best if you’re thinking about your post-Epic career.

From Roscoe Dexter: “Re: Epic. I’m waiting out my non-compete. I’ve heard a rumor that Epic once called customers who were courting a recently fired implementer to tell them not to hire them. I’ve studied non-competes and I know they’re essentially unenforceable, but I’ve heard of Epic blacklisting people from Epic certification who circumvented the clauses. I’ll call these rumors since I didn’t hear them directly from the people involved.”

By the way, if you’ve ever wanted to send me something anonymously like Epic Escapee did, remember that the new Rumor Report form (link to your right) allows attachments. I keep forgetting to mention that.

For you Misys folks, especially those in sales, reliable sources tell me that major changes will happen late this week. The new guard is taking over and much of the old one will be dismissed, including many dozen who will be offered severance to leave quietly. Nearly that many will be marched out, I’m told. I have names of a few high-ranking employees who will be affected (good and bad), but I don’t see any point in plastering them here since it’s unavoidable at this point. Condolences to those about to be negatively affected and tepid congratulations to those who’ll be sliding into the still-warm chairs, at least temporarily.

McKesson will buy Birmingham-based patient throughput software vendor Awarix Inc. St. Vincent’s of Birmingham was their development partner, as I recall, and much of the management team came from Emageon.

Speaking of McKesson, they’ve got offices in good places, according to Money‘s new Best Places to Live list. #2: Louisville, CO. #3: Lake Mary, FL.

Since this isn’t an ad-packed magazine, I don’t have to waste your time writing unimportant stuff just to separate those ads. You are now current on the industry. Congratulations and see you next time. If you are so moved, e-mail me. How’s your summer going?

Monday Morning Update 7/16/07

From Tommy Pischedda: “Re: Epic’s non-compete. Didn’t Carl Dvorak give an interview awhile back in Inside Healthcare Computing saying that those didn’t exist? They’re actually pretty nasty about it. Even if an employee is moving because of a spousal employment change, the clause is still enforced. There are some customers who don’t have that in their contracts. Epic has still gone after ex-employees trying to get jobs there.” He told the newsletter the agreement is basic, of limited timeframe, and involves only a few direct competitors (more specifics are in their October 16, 2006 issue).

From Mick Shrimpton: “Re: Epic. I heard that there is a lawyer in Madison that specifically works with ex-Epic employees and HR issues.” I’d enjoy speaking to that person if anyone has contact info. I also heard from a former Epic employee who broke the chains in going to work for a customer and offers help to those who need it, so I’ll forward your contact info to him if you like.

From John “Stumpy” Pepys: “Re: Illinois nurse staffing bill. I haven’t heard any word about Illinois Senate Bill 0867, Nurse Staffing by Patient Acuity. Any thoughts in the industry about this?” I’m not a fan of the article itself since it clearly favors the nurse’s union that supported the bill and refers to nurses as “her” (like male nurses don’t already have enough ‘splainin to do). Its sponsors were Democrats, of course. It requires hospitals to use a patient acuity tool, an idea that’s come and gone at least ten times since the early 1980s. I’m not a fan of prescriptive lawmaking where the government gets involved with how businesses operate, but the sad thing is that hospitals were so lax on staffing that it came to this.

From Grapevine: “Re: Initiate Systems. Mark Battaglia, SVP of worldwide business development, is no longer with the company. Initiate is pursuing IPO and one has to wonder why a top executive would exit the company at this time.” Looks like he was nuked off their Web page sometime after May 14.

From The PACS Designer: “Re: best hospitals. TPD closely follows the annual release of America’s Best Hospitals by US News and World Report, which happened today.” The honor roll: Hopkins, Mayo, UCLA, Cleveland Clinic, MGH, NY Presbyterian, Duke, UCSF, Barnes-Jewish, and Brigham and Women’s, University of Washington, HUP, UPMC, University of Michigan, Stanford, Yale-New Havel, Cedars-Sinai, and University of Chicago. Hey, how come the Vandy informatics rock stars didn’t propel VUMC onto the A-list? Kidding. Just popped into my head because we were talking about it earlier.

From Ronnie Pudding: “Re: Andy Corbin. My theory as to why he left Sage was that he’s being indicted. After all, the Forbes article was an embarrassment to the Justice Department. Anyway, he wasn’t much of a leader and surrounded himself with people who don’t know the industry and who don’t listen to their subordinates who do. He also pushed the selling of Emdeon to Sage, so maybe Sage is feeling ripped off at this point.”

From Angela: “Re: Verisign. I read yesterday where the CFO of Verisign resigned. This and the recent departure of their CEO and the failed investment in Healthvision would lead one to believe that they have changed their minds regarding the health care space.” The CFO bailed after yet another options-dating scandal that will cost the company $160 million and force it to re-state earnings. The CEO high-tailed it in May. You have to expect them to retrench back to core business, which healthcare isn’t. How that will affect Healthvision is anyone’s guess.

From Viv Savage: “Re: Misys. Mike Etue is the new Senior VP of Sales for Misys.” Well, if so, then I’ll pat myself on the back for near-psychic ability for taking that wild guess strictly on the basis of timing. If it’s true, that would pretty much dismiss the implied claim by Eclipsys that they fired him, unless he was darned fast at lining up a new gig.

I’d like to introduce you to The White Stone Group, Inc. of Knoxville, TN, an HIStalk Platinum Sponsor. They’ve been around since 1991, with over 400 hospital customers and three major products: TRACE (revenue cycle communication tracking, like precertification, to improve denials management); OptiVox (handoff reporting for shift changes and transfers, of obvious Joint Commission importance); and VoiCentral (automation of incoming telephone calls with information templates for pre-registration, scheduling, etc.) They offer lots of case studies and articles on their site. It’s pretty cool that they’ve found some unusual yet much-needed healthcare IT areas of focus. I always Google companies before I take them on as sponsors and I ran across this interesting article about White Stone’s struggle with providing employee health insurance. Back in 2004, the wife of one of the company’s 70 employees gave birth to quintuplets, racking up a $2 million hospital bill that increased the company’s premiums by $90,000 per year. “For a company with $8 million in revenue, that extra $90,000 was going to hurt. ‘Willem said he was sorry,’ says [CEO Guille] Cruze, who tried to reassure his employee. ‘I told him that it was okay, that we would live and die as a team.'” Welcome and thanks to The White Stone Group for supporting HIStalk.

A regular reader chimes in with some Mac comments that make me want to give it a run. “As a non-zealot who’s used both a Mac and a PC since 1992 (as well as a UNIX machine), I recommend an iMac. OS X is elegant, works very well, learning curve not high if you do Windows, and an iMac is an elegant piece of hardware, besides, that is quite a change from the usual ugly metal box. Kind of like a Camaro Z28/SS being the opposite of your neighbor’s minivan. And now that Macs use Intel inside, you can have your cake and eat it too.” They look cool, but I was most intrigued by the Mac mini. I don’t know anything at all about Apple (I lost interest 100 or so years ago with the Lisa flop) and their commercials seem to aim to a different demographic than mine, but maybe I’m missing out.

Cerner COO Paul Black will retire on August 31, the company announced Friday. Sorry for the redundancy for you regular readers: I said this would happen on February 28 (courtesy of Private Ryan), May 7 (PezMan), and again on June 27 (Hatchet Guy). Given their production cycles, the trade journals will have this scoop by Labor Day or so (if they run it at all, since it isn’t advertiser-friendly), so that means you read it here six months early. The COO position, which Paul assumed in February 2005, won’t be filled. Isn’t 48 a bit young for retirement?

Eclipsys announces KLAS results indicating that it has the highest nurse satisfaction rating of fully rated vendors and the highest positive commentary percentage. That last stat is beginning to annoy me: how valid is a comparison of percentages of positive commentary when all comments are voluntary, unattributed, and of wildly dissimilar relevance and importance? And, in the interest of fairness, I note that the “fully rated vendors” part was tacked on by Eclipsys because Epic annihilated them in the nurse satisfaction score, but with too few respondents to meet KLAS’s validity standard. They were also fifth in the eight-horse race for adoption scores. Still, I’d place it above most of what’s out there, with the very bright spot being Knowledge-Based Charting. Had they rolled out a pharmacy package earlier to gear up for medication dispensing and bedside barcoding, they’d be sitting pretty right now.

Sentillion announces nine new Q2 customers. I like their tagline (assuming it’s true): “The company that created healthcare single sign-on.”

The president of a corporation that ran nine San Francisco-area nursing homes gets 30 months in jail for failing to pay $10 million in payroll taxes. He also owned Skilled Logic Systems, a software company (without a web site, so I’m guessing tax dodge.) His genius attorney tried to keep him out of jail by citing Scooter Libby’s get out of jail free card. It didn’t work. “Easterday ran his business on the government’s tax dollars, buying a six-bedroom home now valued at $2 million, sending his children to private colleges, funding his mother’s monthly pension and buying a sailboat and jet skis, Assistant U.S Attorney Jay Weill wrote in a sentencing memorandum. ‘He used the withheld payroll taxes like an ATM machine for working capital for his business activities,’ Weill wrote.” I made up some amusing lyrics, sung to the tune of Yesterday, but that kind of humor is beneath me.

Modern Healthcare had a pretty good editorial going called Scrap the National IT Plan, at least until toward the end when it advocated smart cards for data sharing. Other than that one ill-conceived paragraph, I liked it.

University of Rochester claims that labor savings from reduced chart pulls gave them a 16-month payback on TouchWorks.

Bye. E-mail me.

Sage Software Healthcare CEO Andrew Corbin Resigns

Andrew Corbin, president and CEO of Sage Software Healthcare, has resigned, the company announced this morning. Sage North America CEO Ron Verni will assume his responsibilities until a successor is hired.

News 7/13/07

From TalkOfTheTown: “Re: Allscripts. Executive changes in the small business unit of Allscripts (A4). VP of sales is leaving there is some indication that the president of the business unit is leaving as well.” Unconfirmed.

From Bill Blazejowski: “Re: Eclipsys. Much as Eclipsys would like you to believe they let Mike Etue go, he in fact resigned and will be joining another vendor next week. After all, Jay Deady has to pretend to do something to justify his $2.3M 2006 paycheck (see proxy). Demonstrate action by reorganizing over and over again, which Andy seems to like – progress through attrition and bringing in sycophants to make you feel good.” I wondered if Etue might end up at Misys, since the rumored source of their new sales VP was either Kodak or Eclipsys. Coincidental timing, maybe, but jobs don’t open up every day at his level. I hear from reliable sources that Misys named the new VP Tuesday, but I don’t have a name yet.

From Scot Silverstein: “Re: ‘I only wish those similar types might go back to being physicians full time and stay out of informatics, where they DON’T belong.’ I agree with that. Informaticists need to be intermediaries between different healthcare factions, not primadonnas. Your audience might like a presentation I gave to ARMA last year on this issue.” Most of the informatics people I know, docs included, are pretty down to earth. From reader comments, Vandy’s aren’t, apparently, despite the tiny domain they’re lording over. I guess it’s like Star Trek conventioneers feeling smug when one of their ilk doesn’t know which actor was missing a middle finger.

From Edward Koogle: “Re: Epic employees. What do you know about ways around hiring Epic employees? Does the whole industry really pander to Judy so much that they let her get away with harboring and controlling all the Epic talent in the marketplace? We aren’t an Epic partner and we want to hire a current Epic employee, but is there any hope of getting a client to contract them from us? All the clients seem to be willing to stay in the corner that Judy puts them in without a word of dissent. It’s un-American to stand by passively while the spirit of free competition is quashed!” I’ll allow those who are more knowledgable of that particular situation to respond.

From In the Know: “Re: Bronx Lebanon. Eclipsys and Medsphere are being dragged along to keep Cerner honest on price. The CIO drank the Kansas City Koolaid. It’s Cerner’s deal to lose … and GE’s, too.”

From Dewey Oxberger: “Re: sponsors. You’re getting a lot of sponsors. Are you and Inga doing some kind of marketing blitz?” No. All we do is reply to e-mails when someone asks for information about sponsoring. Nothing’s changed since I started HIStalk in 2003, other than I’ve got a ton of readers and that gets the attention of sponsors (as does the presence of the lovely Inga as my Queen). I’m still the same irascible, annoying, cynical blowhard that I’ve always been, although I’m hoping to mellow into a lovable curmudgeon at some point. I sure do appreciate the support, however. I’ve worked harder on HIStalk than anything else in my undistinguished career, so it’s nice to get some recognition (which is hard to come by when you’re sitting alone in a room writing anonymously).

From Francis Soyer: “Re: Sentillion. Someone told me that Sentillion laid off 30% of the company a few weeks ago, although they tried to take care of those affected. The person said that competition from Carefx, Improvada, and the big vendors is cutting into sales.” Unconfirmed, but I’m sure someone will update me.

From Bob Saccamano: “Re: CHOP. I just heard from a frustrated physician at Children’s Hospital of Philadelphia that Epic has been down in the clinics for two and a half days (since Monday) and they’re back to paper. No idea if it’s Epic or IT issues, would love to know if any HISTalk readers have more info. Keep up the great work, it’s much appreciated. Also, love HISTalk2 and the weekly email summary concept and can’t wait to sign-up.” Thanks, Bob, Anyone got the scoop on CHOP? I heard the same thing from another source. And thanks for the HIStalk2 kudos – having a new design and platform is like wearing a shiny new pair of tennis shoes. The weekly e-mail update is imminent – my graphics guy is working on a logo and fine-tuning my crude HTML e-mail format as we speak. HIStalk is great for those of us knee-deep in the industry every day who know all the companies and people. The weekly update will be more accessible to executives, non-IT provider-siders, and those who just want a no-nonsense quick read with background information and opinion (printing it off will be a one-click option – I know you travelers love that).

Some thoughts on Allscripts stock, which Forbes called one of the most dangerous. Price-to-book ratio and return on invested capital were mentioned, which aren’t that meaningful for acquisition-minded tech companies. Old news, in other words, and presumably built into the stock price. Software companies don’t have many assets on the balance sheet (or so you hope, since they probably wouldn’t really drive revenue all that much anyway). Cash flow is more important than paper writeoffs, although Allscripts needs to improve cash flow since the share price is pretty much NPV – a price reflecting future cash flows. The bottom line: these measures don’t move share prices up or down. For growing companies, it’s all about shareholder expectations and growth. Supply and demand of shares, in other words, to use my favorite economic principle. Pull the back issues of Forbes and see how often they’ve hit the nail on the head before following their advice mindlessly.

A reader tried to explain the Apple thing to me. Summary: (a) Windows is a cheap imitation of Apple’s good ideas; (b) OS X is far more secure than Windows; (c) reboots and OS reinstalls are nearly unheard of on Macs and reboots are nearly instantaneous compared to Windows; and (d) DLL Hell is a Windows-only disaster. He mentioned that journalists given Apples to try rarely went back to Windows afterward. Since I’m not a Windows slave anyway, I’d try a Mac if Apple gave me a freebie (especially since the reader mentioned that Macs now run Windows apps at full speed and can also dual-boot). My bias against Apple is because of whiners form my previous IDN: the half-dozen or so marketing hippies and pain-in-the-ass docs who hit you over the head with their Apple evangelizing every time their stuff didn’t work on our network. Those self-proclaimed rebels mindlessly followed every oppressive hospital rule except the “PCs only” one, using that pitifully insignificant rebellion as a proclamation of their individual freedom over corporate control. Sounds good until you can’t get on the network and no one in IT knows squat about Apple.

Please welcome to our happy little band MedMatica Consulting Associates, of Chester Springs, PA. They just signed on as a Platinum Sponsor of HIStalk and offer IT strategic planning, application evaluation and selection, operational improvement assistance, HIPAA, contract negotiation, implementation of most major systems (Siemens, Epic, Cerner, Eclipsys, Lawson, etc.), and technology consulting (database, e-commerce, COBOL, and SAS). Pay attention to their value proposition – highly skilled consultants deployed regionally with a very competitive fee structure and flexibility for the client to structure whatever services meet their needs. Check out their client testimonials, with real names of hospitals and people, several of whom I know. MedMatica has been named as the 12th fastest growing company in the Philly area, so they must be doing something right. Click over, take a look, and tell Bruce Generotti or the folks there that you appreciate their support of HIStalk and its readers. They could have thrown away ad dollars running glossy pages in free magazines that no one reads, but instead they chose to support an independent blog and its “think for yourself” readers, which Inga and I truly appreciate.

I didn’t hear anything further on the rumor that Meditech is buying the rest of LSS. A couple of readers asked. Sorry, I don’t know (yet).

The former Surgeon General says that the Bush administration compromised public health by stifling him on politically charged issues like contraception, global health, and secondhand smoke. He was also told to mention President Bush three times per page of his speeches, ignore Special Olympics because the Kennedys are involved in it, and make partisan fundraising appearances.

A House bill would create independent health record trusts, giving patients ownership of their electronic records and allowing them to assign trusted parties to manage them.

Billie Waldo is named chief nursing officer of McKesson.

A little problem in HMS’s billing system: each patient’s bill was the cumulative total of all bills that printed before it. The highest for a Northern Cochise Community Hospital (AZ) patient: $49 million. The hospital said HMS told them they were busy that day and didn’t notice. Funny quotes from hospital staff, among them, “If enough people pay them, we’ll keep the nursing home open longer!” Hey, it happens, might as well laugh and move on.

Sanford Health (SD) chooses EnovateIT for mobile and arm-mounted devices for their EMR rollout.

MedAssets keeps buying: they acquire revenue cycle software vendor MD-X Solutions.

Blue Shield of California announces $11.3 million in nonprofit grants, including rural IT and telemedicine.

Two Sioux Falls (SD) health systems will use Meditech.

Big news: the Dossia PHR project, whose corporate members include Wal-Mart and Intel, is falling apart. Dossia has filed a restraining order against Omnimedix Institute, a 13-employee nonprofit headed up by J.D. Kleinke. He says Dossia did it to prevent an Omnimedix suit of its own. Omnimedix wanted paid, but Dossia says it hadn’t met deliverables. Omnimedix was supposedly getting $15 million to build the PHR system, which is behind schedule. Dossia is considering other vendors. Fine reporting by InformationWeek. I’m sure our intrepid HIT rags will catch up eventually.

Memorial Hospital of Rhode Island will partner with ICW America to create a PHR based on that company’s existing LifeSensor PHR.

GE won’t buy Abbott’s diagnostic testing business for $8 billion after all.

Baylor complains that one of its hospitals was declared worse than average in heart attack deaths, saying they missed the cut by just one patient. CMS said it was one of the worst in the country. As usual, the hospital howls that its widely recognized excellence drives dying patients to seek them out, skewing their numbers. CMS wasn’t impressed: “There are other hospitals who said the same thing.” Among them: fellow cross-town bottom feeder Huguley Health System. Baylor trotted out a list of its own wonderfulness, including the fact that its $240 million EMR system will reduce post-surgical deaths, ignoring the fact that hospitals that beat the pants off it have no such system.

According to this newspaper, HIPAA stands for “Health Insurance Probability and Accounting Act”. That’s 60% right for you “glass half full” types.

If you have anything important or scandalous to say, e-mail me. I’d do it for you.