The New York Times reported this week (Wal-Mart Plans to Market Digital Health Records System) that
the company’s Sam’s Club division will bundle eClinicalWorks
electronic medical record software, Dell computers, installation,
maintenance and training to offer to small physician practices. Pricing
is about $25,000 for the first physician in an office, and $10,000 for
each subsequent physician. Annual maintenance and support costs will be
about $4,000 to $6,500 (though it doesn’t say whether that’s per
physician or per practice).
Wal-Mart says its package deal of hardware, software,
installation, maintenance and training will make the technology more
accessible and affordable, undercutting rival health information
technology suppliers by as much as half…
Dell will be responsible for installation of the computers, while
eClinicalWorks will handle software installation, training and
maintenance. Wal-Mart is using its buying power for discounts on both
the hardware and software.
This program has promise, but it isn’t revolutionary and is by no
means certain to succeed. Interestingly, the Wal-Mart PR people, who
usually send me a heads up about any new Wal-Mart move in health care,
didn’t tell me about this one. It makes me wonder what’s really going
on. There are a couple of very promising aspects of this program:
- The company partnered with eClinicalWorks (eCW), which based on my
experience is the best system for small and mid-sized practices. The
software is easier to install and use than competitors’ programs, and
has a lower total cost of ownership. eCW has done an excellent job with
the Massachusetts eHealth Collaborative, for example.
- The program addresses one of the key bottlenecks of EHR adoption
for small practices: distribution. It’s painfully difficult and
expensive to sell EHRs to physicians and that’s a big part of a
vendor’s costs. I don’t know what Sam’s Club plans to do in that
regard, but if they figure how to sell to physicians efficiently that
could be a big deal. Physicians are starting to realize that they need
an EHR, so perhaps it will be easier than in the past to make the sale.
Having said that, I’m not convinced Wal-Mart has any idea how to do
There are also unanswered questions and some key elements that the program doesn’t address:
- It’s hard to tell if the pricing is attractive or not. It’s
notoriously difficult to make an apples to apples comparison of EHR
costs and there is not nearly enough information in the article to know
whether there will be any savings at all from the typical eCW pricing.
The claim of “undercutting… by as much as half” can be said about eCW
anyway, with or without Wal-Mart. This is not like the $4 Wal-Mart
generic program where Wal-Mart really did undercut existing pricing
- After cost-effective distribution (mentioned above) the main
bottlenecks in EHR adoption are finding enough good technical people
and change management people to help physician practices transition to
the new workflow patterns that EHR adoption brings. Successful
companies like eCW already strain to find enough talent to meet the
demand. And it looks like eCW will still be responsible for all of
those activities –not Wal-Mart. I don’t think Wal-Mart adds any value
to this part of the equation.
So overall, thanks Wal-Mart for giving this a go. At least you
picked the right EHR vendor to work with and are raising awareness
among small physician practices. If you make this program a big success
I’ll be impressed and surprised.