The Long Tail of the EMR

HomepageIn the fall of 2008 I had the opportunity to do some research on the, then dormant, EMR marketplace. The results came as no surprise. Most physicians did not have an EMR and were not interested in adopting an EMR due to cost and usability barriers.

Much has changed in one short year. Spurred by ARRA and its HITECH portion, there is a renewed interest for technology in the physician community. Some of it came from the promise of stimulus funds and some stems from the perceived inevitability of the need to have technology in one’s office. There is no feverish anticipation of the great things an EMR will bring to a medical practice. Instead, there seems to be a somber resignation to the upcoming demise of a trusted friend: the paper chart.

On the other side of the market, vendors are gearing up for 2010. Since stimulus funds are supposed to begin flowing in 2011, the coming year is crucial to most vendors. There is a palpable sense of urgency for capturing market share before it is too late, and all physicians have made their choices. After all, once a physician buys and uses an EMR, changing vendors is not an easy proposition. Transferring clinical data from one EMR to another is practically impossible and the costs of change are high.

The HIT news is chockfull of announcements of mega deals almost every day. Mergers and acquisitions are rampant. Vendors are signing multi million dollar deals with large hospitals, medical organizations and regional healthcare groups to provide EMRs to affiliated physicians. At this point in the game, there are two vendors clearly ahead of the pack in the ambulatory market: Allscripts and eClinicalWorks.  It is likely that the next months will add a few more contenders for large chunks of market share, most likely athena, NextGen and probably GE. These large corporations, most of them public, are very well poised to capitalize on the ARRA stimulus. They have the marketing power, the infrastructure and the ability to forge business agreements with equally large distribution partners that will lead to significant sales through 2010 and 2011.

However, the ambulatory EMR market has a very Long Tail.

Granted, the EMR market is not a consumer market per se. It has a finite size of a few hundred thousand customers and once a customer buys one EMR, it is very unlikely that he/she will be buying another one for at least several years. However, certain aspects of Chris Anderson’s Long Tail theory still apply to the ambulatory EMR market.

Examining the current state of EMR adoption reveals that a handful of products are used by many physicians, while hundreds of others are used by very few, and some homegrown EMRs are only used by their creator and maybe friends and family. These hundreds of small to tiny products are the Long Tail of the EMR market and the tail has been getting longer and longer ever since HITECH became law. Unfortunately for small vendors, the tail has been also getting narrower at most points, and many existing small businesses, as well as new entrants, are hurting.

Few medium size vendors, in the thicker part of the tail, have been around for a while and are no better and no worse than the large players. Their survival will depend on finding ways to manage costs down and identify niches where they can provide unique service.

Then there are the newer web based, or internet based, EMRs. Most have price points significantly lower than the popular products. Unfortunately, the product quality in this group is not superior to the large EMRs. These vendors are most at risk of being wiped out by the bigger, better funded competition, who is also exploring the “cloud” based paradigm.

The homegrown products will likely always exist and serve the limited market they were designed to serve, with no major effect on the overall EMR market.

And then there is the exciting part of the tail, the part where innovation occurs. Tails are much better suited to breeding innovative solutions and the EMR Long Tail is no different. The tail contains several open source products that grow and innovate based on active user participation and distributed development efforts. These are worth watching. Other residents of the tail are attempting to formulate novel business models based on aggregation of smaller software packages, such as electronic prescribing, registries and patient connectivity. Some of these companies are veteran portal service providers adding new service lines to meet government regulations. DocSite, RelayHealth and Quest 360 are just a few. Others are trying to create entire platforms on which interchangeable software service providers can aggregate their wares. And then there is the entire Health 2.0 phenomena attempting to bring consumerism to health care, but that deserves its own separate analysis.

The takeaway for small vendors in the EMR space is that one can create a very profitable business in the EMR Long Tail. Physicians are not a homogeneous group of customers and it is very unlikely that that the utilitarian large EMR vendors will be able to satisfy the majority of the market. Multiple niche opportunities already exist in providing services tailored to particular medical specialties and various practice models, such as medical homes, concierge medicine, telemedicine, micro practices and more. More niche opportunities will be created by physician work-flow preferences and proliferation of non-physician providers. Tail companies that learn how to answer the needs of these niches by providing high quality solutions, while keeping costs of customization and service to a minimum, will thrive.

Since in the software world nobody stays on top for very long (except Microsoft), a disruptive enough technology breakthrough will eventually occur and the EMR market will be irrevocably changed, and the change will likely be brought on by someone from the Long Tail.

Margalit Gur-Arie was COO at GenesysMD (Purkinje), an HIT company focusing on web based EHR/PMS and billing services for physicians. Prior to GenesysMD, Margalit was Director of Product Management at Essence/Purkinje and HIT Consultant for SSM Healthcare, a large non-profit hospital organization.

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  1. This is an wonderfully informative article and discussion. As a private practice-oriented EMR vendor, we can empathize with the concerns of small practice health care providers in light of the seemingly intrusive government mandates for conversion to EMRs/EHRs. However, we maintain that committed specialty vendors like ourselves will be able to remain in the marketplace without compromising quality, price, and integrity even after government incentives have passed. When choosing an EMR vendor, be sure to take into consideration the relationship that you will form with the company itself, as the decision to implement an EMR goes beyond just the new technology in your office. Larger vendors may not be able to offer you the personalized attention that smaller vendors can. Remember that you are forming a partnership that will extend past any stimulus incentives that come and go.

  2. Maybe some home garage software shop is currently churning what will be the next success product.
    Status quo rarely survives modernization revolutions.
    I don’t necessarily think open source has anything to give but deception. Open source has proven to be a mechanism to “sucker-in” free developers and then to create out of the community hard work proprietary products.
    The EHR Guy

  3. Excellent post, Osler. If EMRs were as great for the consumers (i.e., physicians, the ones who buy them) as claimed, they would sell themselves. But they aren’t, so it’s taking enormous government subsidies and the mindless cheerleading of our professional organizations to shove them down our throats.

  4. The first two HITECH priority grant programs, funded through the Recovery Act, support the national implementation of electronic health records (EHRs) initiative.
    Approximately $598 million is being made available through the Health Information Technology Extension Program (Extension Program), to ensure that comprehensive support is available to health technology users.
    Under the State Health Information Exchange Cooperative Agreement Program $564 million will be awarded to support efforts to achieve widespread and sustainable health information exchange (HIE) within and among States through the meaningful use of certified Electronic Health Records.
    State Health Information Exchange Cooperative Agreement Program
    The State Health Information Exchange Cooperative Agreement Program will help States and Qualified State Designated Entities (SDEs) to develop or align the necessary policies, procedures and network systems to assist electronic information exchange within and across states, and ultimately throughout the health care system. A key to this program’s overall success will be technical, legal and financial support for information exchanges across health care providers.
    The Extension Program will provide grants for the establishment of Regional Health Information Technology Extension Centers (Regional Centers) that will offer technical assistance, guidance and information on Electronic Health Records best practices. These estimated 70 (or more) Regional Centers each will serve a defined geographic area. The Regional Centers will support at least 100,000 primary care providers, (and receive $5,000 for EACH PROVIDER that is successful at “meaningful use”) through participating non-profit organizations, in achieving meaningful use of EHRs and enabling nationwide health information exchange with direct, individualized and on-site technical assistance in:
    Selecting a certified EHR product that offers best value for the providers’ needs;
    Achieving effective implementation of a certified EHR product;
    Enhancing clinical and administrative workflows to optimally leverage an EHR system’s potential to improve quality and value of care, including patient experience as well as outcome of care; and,
    Observing and complying with applicable legal, regulatory, professional and ethical requirements to protect the integrity, privacy and security of patients’ health information.
    The Extension Program will also establish a national Health Information Technology Research Center (HITRC), funded separately, which will gather relevant information on effective practices from a wide variety of sources across the country and help the Regional Centers collaborate with one another and with relevant stakeholders to identify and share best practices in EHR adoption, effective use, and provider support.
    Grants under the Extension Program will be awarded on a rolling basis with an expected 20 grants awarded in the first quarter of FY2010, another 25 in the third quarter and the remaining awards in the fourth quarter of FY2010. The initial funding includes approximately $598 million to ensure that comprehensive support is available to providers under the Extension Program beginning early in FY2010, with an additional $45 million available for years 3 and 4 of the program. Federal support continues for four years, after which the program is expected to be self-sustaining. Of the total federal investment in this program, about $50 million is dedicated to establishing the national HITRC, and $643 million is devoted to the Regional Centers.
    The law requires that Regional Centers be affiliated with a U.S.-based, nonprofit institution or organization, or an entity thereof, that applies for and is awarded funding under the Extension Program. The program anticipates that potential applicants will represent various types of nonprofit organizations and institutions with established support and recognition within the local communities they propose to serve.
    The performance of each Regional Center will be evaluated every two years by a HHS-appointed panel of private experts, none of whom are associated with the center being evaluated. Continued support for the Regional Center after the conclusion of the second year of performance will be contingent on the panel’s evaluation being, on the whole, positive and on HHS’ determination that such continued federal support for the center is in the best interest of the program.
    The Regional Centers will focus their most intensive technical assistance on clinicians (physicians, physician assistants, and nurse practitioners) furnishing primary-care services, with a particular emphasis on individual and small group practices (fewer than 10 clinicians with prescriptive privileges). Clinicians in such practices deliver the majority of primary care services, but have the lowest rates of adoption of EHR systems, and the least access to resources to help them implement, use and maintain such systems. Regional Centers will also focus intensive technical assistance on clinicians providing primary care in public and critical access hospitals, community health centers, and in other settings that predominantly serve uninsured, underinsured, and medically underserved populations.
    The Extension Program expects all Regional Centers to be operating at full capacity by the end of December 2010. In addition, it is expected that by the end of December 2012, the Regional Centers will be largely self-sustaining and their need for continued federal support in the remaining two years of the program will be minimal.
    Additional information is available at http://healthit.hhs.gov/extensionprogram

  5. First of all, Ms. Gur-Arie thank you for inviting me to comment on your article.
    Unfortunately, the “Long Tail” premise unravels quickly once you realize that EMRs no longer operate under the rules of a free market. With the ARRA payments/HITECH Act flushing billions of taxpayer dollars into the gaping maws of only “certified” EMR vendors, the tail will quickly shorten, as vendors who are unable to meet those still-not-yet-announced criteria get left behind. Physicians will quickly cluster around a very small number of dominant EMRs (as is already happening) and the tail will both shorten and become asymptotic much more quickly.
    Furthermore, EMRs have no science behind them. There are no large, unbiased studies looking at whether or not EMRs provide significant positive improvements to patients and physicians commensurate with the cost of these ridiculously expensive applications. Why is the government so willing to spend 44 billion dollars on EMR funding where there is no proof that EMRs are superior to paper?
    The fact that EMRs are being forced onto physicians before the government has created mandatory standards for EMR intercommunication, EMR data import/export, e-prescribing, transmission of lab orders and lab results, etc. is truly obscene. As I’ve said in the past, forcing physicians to implement EMRs at this stage of their development is akin to forcing a farmer who is surrounded by muddy dirt roads to buy a $200,000 Ferrari convertible. Why should physicians adopt not-ready-for-prime-time technology that will likely end up costing them both time and money, while providing them with minimal personal benefit? Why is the government so intent on rushing into EMR adoption without actually planning for it and studying it? Could it be that EMR vendor lobbyists are the ones who are pushing so aggressively for these impetuous changes to the status quo? The reality is that right now the major beneficiaries of EMR adoption are EMR vendors, insurers and the government. Yet (as usual), it is physicians who are expected to pay the bill for switching to an unproven new technology.
    Paper charts earned their way into physicians’ offices.
    Telephones earned their way into physicians’ offices.
    Fax machines earned their way into physicians’ offices.
    Computers earned their way into physicians’ offices.
    Printers earned their way into physicians’ offices.
    Why do EMR deserve to be shoved down the throats of physicians? If EMRs are a shown to be a useful technology, physicians will adopt them at the appropriate time. Forcing that adoption is wrong in every sense of the word.

  6. Dr. Watkins, in all honesty, some offices are able to realize these efficiencies with a lot of training and planning and commitment to be successful. Others are not and most have not been interested in trying. So there really isn’t any statistically significant data out there.
    The main reason, in my opinion, to move to electronic documentation is the future ability to meaningfully exchange data with other physicians and hospitals. You could argue that you’d rather wait before that data exchange is possible, and I understand that.
    However, somebody has to be first and collect exchangeable data in order to test and define the exchange protocols and measure the benefits.
    Maybe this is only for the early-adopter crowd. Maybe the majority of docs would prefer to wait and see, and join in when there is enough evidence to suggest that it’s both feasible and worthwhile.
    At this point, yes, insurance companies and government agencies are most likely to benefit. But also patients, who are given access to their electronic records and can contribute more to their care, increase compliance, and that is probably a good thing. And, yes, I know there is still no hard evidence to support this assertion either.
    Generally speaking, information is migrating from paper to computers everywhere around us. It is a plausible assumption that health care will not be exempt. I guess we need to figure out how we make technology useful instead of fighting the inevitable. There’s going to be a lot of trial and error taking place in the near future.

  7. “EMRs are going to cut healthcare costs and improve quality. Unfortunately, reality is not supporting this view.”
    And this is where I get confused. It seems like all the reasons given for switching to EMRs – lower costs, higher quality, reduced staffing, higher level coding, and so on – are not supported by the reality of the experience.
    So exactly WHY are we “pushing physicians into the electronic age?” My guess is it’s about serving the needs of the insurance companies and government agencies at this point.

  8. rbar, I totally agree with the lack of deliberation. Somehow, somewhere, somebody managed to convince the Bush administration and consequently the Obama team, that EMRs are going to cut healthcare costs and improve quality.
    That is the motto that every EMR salesman has been living by for the last decade.
    Unfortunately, reality is not supporting this view and the government hasn’t taken the time and research to validate this assumption.
    Maybe in the future, when interoperability is exactly what you are describing (any provider can access any patient’s complete record with one click of a button), EMRs, or more accurately, networks of EMRs, will fulfill that expectation.
    I don’t really object to pushing physicians into the electronic age (gently), but I believe we need to devote as much, if not more, resources to building the “roads and the traffic control”, a.k.a standards, networks and terminology.

  9. John, I found the following lines cryptic:
    “As for the “small offices” you mentioned, the importance is underscored because that is where the doctor/patient connection is likely to be more personal than institutional. The benefits are incalculable, not trivial, because it is in that setting that the patient is most likely to be most reliably informed about his medical situation, either by the doctor or a competent assistant.”
    What kind of information do you mean? If there is one paper record and one provider in anoffice (or a small number of providers), EMR are of little use re. data storage and readiness – you can easily locate and browse through the paper chart.
    What I personally think would be the ideal solution is a central database that stores patient data based on name, DOB and another identifier if needed and that is password secured and accesible via a citrix server or sthg similar. I don’t understand the fuss about security, very many large MSG are using their EMT that way, with home access by their docs. This would maximize info access and thereby prevent duplicate exams and improve care. And patients who don’t want it can opt out.
    Thank you for your thoughtful reply, Margalit. I agree with the generational gap you point out (I am somewhere inbetween being in my early 40s).
    And the crucial point for interoperability, IMHO, is: for true interoperability, pt data needs to be directly accessible with patient data search (i.e. you should be able to find all tests of patient xy, regardless of where they were done); with every hurdle (e.g. you need to know the provider who did the test, and/or you need to log in into different system in oder to get it), you prevent the desired flow of medical information.
    Not to be misunderstood, I am all for EMR, at least for hospitals and MSGs.
    I just think we (the Obama admin and very many HC wonks)are pushing EMR w/o deliberation – like building giant airports without having good access roads and air traffic control … investing a lot and getting little in return.

  10. rbar, what are EMRs good for is not at all a simple question.
    Originally, the first EMRs were more of a productivity tool for a medical office. The goal was to realize efficiency by automating processes, just like other industries, such as accounting, manufacturing, etc. With that in mind, EMRs were designed to facilitate intra-office communications, aggregate all the paper into one electronic chart and make it available to multiple users simultaneously.
    Well, that was all fine and dandy, but the Achilles heel of this approach was that the most expensive resource in the house, the doctor, was now required to spend more time with each patient doing data entry into a computer. The other office staff was indeed more efficient, but it all gets dwarfed by the physician loss of time.
    In larger clinics, where processes are more complex, the efficiency gains for staff were even larger. If physicians managed to somehow adapt to the system, then the EMR implementation was considered a big success. Otherwise, it became a failure.
    In all honesty, there is more to this than just the fact that EMRs have lousy usability. Physicians are used to writing on paper and are very short on time. Any change in the known routine is considered a problem. Today’s younger docs belong to a generations that doesn’t write much, if at all. Everything is typed on a computer starting in grade school. Maybe EMRs should have waited for this new generation.
    Somewhere along the line EMRs where re-baptized to EHRs and this new entity was supposed to provide interoperability. EHRs are supposed to facilitate clinical data flow between providers. As you very well know, we are a long way from achieving this lofty goal.
    We can send/receive labs, prescriptions and maybe some imaging electronically, but actual medical records exchange between physicians/hospitals still requires the good old fax machine (it now goes directly into the EHR instead of paper).
    EHRs also provide good disease management and population management abilities, but as you said, that depends on the clinic and larger offices are better suited to take advantage of these complex tools. I do agree with John that everybody should, but as long as reimbursement is what it is, very few docs will have the time to do that.
    So what should we do? Build interoperability standards first and only then request physicians to use EHRs? Or should we require that medical records get computerized first, and when we have a enough data, we can start moving it? I don’t know, maybe we should proceed in parallel and I think that is exactly what is happening now.
    The problem is that we are asking physicians to inconvenience themselves, to a certain degree, based on a promissory note that sometime in the future we will have the capabilities to provide the obvious benefits of clinically significant electronic data exchange.
    All that said, there are very happy EMR/EHR users that are solo practitioners. I guess they found a way to benefit. There are also very angry users and some that won’t even consider EMRs. I think things will be changing in the next few years, hopefully for the better.

  11. I think that EMR are very useful for large organizations (and they di improve patient care), but for small offices, their benefits don’t justify the enormous efforts necessary for ther implementation – unless there is perfect interoperability, which I don’t think anyone claims to be feasible at present.
    I can tell you what it’s good for from a patient’s point of view: electronic tracking of individual records will place the burden of keeping up with the patient’s care on the professionals instead of the patient/layman who at this late date is still expected to coordinate medicines, tests and followups himself. This is hard enough for someone who is already sick, but it gets worse with age. How many octogenarians competently keep up with all their medical conditions and medicines?
    Every time I hear an advertisement for a new drug with a narrator saying “be sure to tell your doctor if you are taking” yadda-yadda… or “…not for people with [fill in dangerous contraindications here]” I want to yell at the TV.
    Patients have to report symptoms to their doctors, but keeping up with a global health plan is the job of the pros. Too many ways to mess up. But doctors already know about this. I don’t know whether to be mystified or angry when no one seems to notice such a gaping hole in the system.
    As a senior caregiver (non-medical) I have seen electronic systems in place in several hospitals and long-term care places. Picking the brains of the staff I get the impression that once they get used to it they all see EHR’s as light years ahead of paper. One CNA told me emphatically “I’ll NEVER go back to paper.”
    As for the “small offices” you mentioned, the importance is underscored because that is where the doctor/patient connection is likely to be more personal than institutional. The benefits are incalculable, not trivial, because it is in that setting that the patient is most likely to be most reliably informed about his medical situation, either by the doctor or a competent assistant. Whatever “enormous efforts” might be necessary are justified many times over in an improved level of information, outcomes and old-fashioned safety.

  12. What I miss from this and similar posts is an analysis of what EMR are good for.
    I have no IT background, but I have used more than 3 different EMR over a decade, in various institutions (mainly larger ones).
    The great advantage of EMR lies in their ability to have the information at hand for multiple people at the same time, readily and at all times.
    The other uses (e.g. examination of target parameters such as BP, Hba1c, medication and resource use) can be very useful, but depend entirely on the protocol/policy using them. And whether patient use of the EMR is more beneficial than harmful remains to be seen.
    If coordination of care is the no.1 goal, than all patient information should be easily accessible to the treating team – sthg. that seems to be technically challenging if realized by interoperability of various EMR (or unpopular if realized by creation of a centralized database).
    I think that EMR are very useful for large organizations (and they di improve patient care), but for small offices, their benefits don’t justify the enormous efforts necessary for ther implementation – unless there is perfect interoperability, which I don’t think anyone claims to be feasible at present.
    So, what is an EMR good for? This is a question to ask before we spend further billions, in a country that has multiple other problems in its health care system.

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