The EHR Bubble


Are we in an EHR bubble? Evan Steele, CEO of SRSsoft, predicts that much like the dot-com era, the EHR market is in the midst of a bubble which is soon to burst. He foresees a shakeout in which consolidation of the current 472 EHR vendors takes place. Steele envisions causes of the popped bubble to be attributable to missed growth projections, government money drying up and physician dissatisfaction with existing vendors, ultimately resulting in a survival-of-the fittest among the EHR vendors.

Several industry leading bloggers have made bold predictions to this same point. John Moore from Chilmark Research offered the following:

Bloom is Off the Rose, EHR Market Plateaus
Going out on a limb, we see 2012 as the year when we start talking of the post EHR-era. Yes, there will be plenty more EHR sales in the year to come but over 2012 we will also see EHR sales growth begin to plateau and level off by end of Q4’12. You heard it here first folks, it is time to collect your EHR winnings and seek new places to invest.

iHealthbeat had its own 2012 predictions for the outpatient EHR market:

  • The use of cloud computing;
  • The use of mobile devices; and
  • Vendor consolidation.

Over the past several months, Galen has seen quite a bit of consolidation in the industry specifically with conversions in support of acquisitions. We have converted groups to the Allscripts Enterprise EHR from a number of legacy vendors – among them AmazingCharts, eClinicalWorks, Greenway, GE Centricity, SRSSoft, SAGE, MedManager – in support of these groups absorption by larger organizations and Integrated Delivery Networks (IDNs).

We continue to see an increasing amount of conversions on the horizon, supporting the claim made by Mr. Steele regarding consolidation in the industry. Organizations are certainly in acquisition and consolidation mode – will the same hold true for vendors? Will we see more mergers and acquisitions in the outpatient EHR space in 2012? I think it is a safe bet to expect activity from those vendors that own most of the market share. The following is a recent ambulatory market share analysis as offered by American EHR:

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2 Comments

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  1. 1
    Michael Dale

    I would think that a consolidation of vendors would benefit the market and bring some continuity. 400 vendors! I think it would help streamline technology and the industry if vendors were consolidated.

  2. 2
    Steve Rothschild

    Analysts have been talking about consolidation in healthcare IT software market for the last decade and there is over 200 more companies in the market now then there was 3 years ago. Only 6% of groups have achieved meaningful use, even if that tripled in the next year that would be a small bubble. Healthcare is comprised of 65% small business, which is why few of them want to buy from the large companies and why the market is so fragmented. Even if the market were to consolidate by 200 companies, there would still be hundreds of competitors. At Enabledoc, we like competition because we have a better product at a lower cost.

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