Cerner has been in the HIT business now for 31+ years having grown to one of the leading EHR vendors in the market. You’ll usually find their systems ...in large healthcare organizations. This sector of the EHR market is seeing fierce competition as Epic seems to pick up one win after another at the expense of others....While continuing to go head-to-head with Epic, it appears that Cerner has also chosen to take a different tack, adopting a philosophy of: if you can’t beat them straight up, change the rules of the game....[The] company is truly looking to remake itself into one that adopts an open approach to not only sharing information ...but provides a foundational “network of services” to enable “communities of care.” ...Cerner is also looking to land additional multi-stakeholder, HIE contracts with their partner Certify Data Systems ....But what may be even more interesting then what they have done in the HIE market, is what Cerner intends to do in the broader consumer market....Cerner has been eating its own “dog food” for the past year using Cerner Health to promote health & wellness among their employees ....Cerner Health will target a number of other health & wellness areas, with programs that include built-in incentives....For some time now, employers and payers have been looking to better manage their populations to lower medical loss ratios (MLRs). Providers will be looking to do the same as they take on a greater share of the risk via new contracts ...and future Accountable Care Organizations (ACOs). Cerner Health intends to serve both employers and provider needs in this regard with “Health Graphs,” a conceptual analytics framework that combines multiple data streams to provide an accurate view of population health at the community level....Cerner Health will go head-to-head with HealthVault by offering a PHP with a published software development kit (SDK) for third party independent software vendors (ISVs) by year-end. This will enable an ecosystem of applications to potentially sit on top of the Cerner Health stack....In addition to releasing the SDK at year-end, Cerner will also open the doors to any and all consumers/patients to store their personal health information (PHI) on the Cerner Health PHP.
There is no question in my mind that this "new" strategic direction by Cerner reflects the long-held core values of the company. Neal Patterson, the CEO and co-founder of the company, has been pursuing this broad vision - a community approach to healthcare delivery and IT -- for more than 25 years. Needless to say, and as John emphasizes, the company has been extremely active in care and wellness activities for its own employees. From the perspective of public health professionals, much of the medical school academic community, and politicians, this insightful approach will certainly be applauded. However, I think that there is one small fly in the ointment. Can Cerner compete more efficiently with Epic with this shift in strategy? In short, can the product be sold to hospital and health system CEOs? In my opinion, the answer to this question is probably no. Here are the reasons why I hold this view.
Most health system and hospital CEOs tends to stay focused on bottom-line issues. Their goal is to maximize the profits of their largely non-profit organizations. This goal is achieved by ramping-up their inpatient admissions and holding onto these patients for no more than three to five days in the hospital. During this time, the number of imaging procedures and lab tests is maximized and these generate the most profits. Their interest in outpatient visits has always been muted because they are less profitable. They are not enthusiastic about exchanging clinical information with other hospitals because they consider it proprietary to their own institutions. Their interest in preventive medicine is minimal to non-existent. Their interest in personal health records (PHRs) is roughly equivalent to that of most healthcare consumers, which is low. They will jump through any ACO hoop demanded of them to the extent that they want to minimally satisfy the feds and employers, hoping that this trend will soon burn out.
It has been demonstrated by market behavior that the CEOs of most large hospitals will spend tens, if not hundreds of millions of dollars, for an Epic EMR. The do so with the knowledge that it will support their preferred business model. Their expectation is that it will work OK and not torment the majority of physicians and nurses. As I opined in a previous note (see: Some Additional Insights into the Epic Corporate Culture ): [The CEOs] only care whether the Epic software they have purchased for millions of dollars can be "slammed-in" and runs "adequately" in their hospitals. Will they spend a comparable amount of money for a community network of services, support for an ACO and PHR, and an ecosystem of applications to sit on top of the Cerner software suite (see: The Feasibility of Using the Epic EMR as a "Platform" to Extend Its Functionality )? In my opinion, not so much. In other words, I think that Epic is now providing to health system and hospital executives roughly what they want and need to pursue their favored business model.