Game Changer?

I always know when a technology has really gone mainstream when I see it for sale in my local Shopper’s Drug Mart.  I still remember this past Christmas walking to the cash register and seeing a pile of HDTV’s for sale.  I remember thinking “Uh oh, this development is going to impact the major TV vendors”.  Sure enough we are seeing major TV manufacturers dropping product lines or even exiting the TV business altogether, citing shrinking margins as the reason for doing so.

Recently an article caught my eye that made me wonder if we are about to witness a similar shift in the EMR market.  (http://trusted.md/blog/mikeryan/2009/03/15/walmart_connecting_doctors_capitalizing_on_emr_stimulus. ).  Wal-mart, agruably one of the world’s most aggressive retailers, is now selling EMRs through their Sam’s Club subsidiary.  The article quotes Dr. David Brailer, former “Health Information Czar” in the United states as saying “If Wal-Mart is successful, this could be a game-changer.”

Mark, what do you think? Will this approach work?  What impact, if any, do you think that Wal-mart’s entry into the market as a distribution channel will have on the market?  Could one of the EMR vendors shut out of the provincial EMR funding arrangements try a similar approach to stay in the game?

4 responses to “Game Changer?

  1. The US EMR market is similar yet different from the Canadian market. In Canada most EMR vendors sell direct to the physician with some limited help of their partners, while in the US there is a complete ecosystem of VAR vendors that resell EMR systems. I think this fundamental difference is very important in understanding the Wal-Mart move in the US.

    US EMR vendors, and more importantly physicians, are used to being able to buy direct or indirect via VARs and there is a comfort level for all players involved. From all I have read, I think Wal-Mart picked one of the better EMR vendors who has had a great deal of success in selling the smaller clinics in the US. These customers are very price sensitive and will likely require a less complex product to automate their less complex business challenges. All that being said, I’m not sure it will be a runaway hit. No matter which EMR vendor you pick, in the US or Canada, there is a huge need for training, implementation and change management services for the physician and their staff.

    I did not see any mention of these services being an option in the Wal-Mart offer. As far as the Canadian market goes, I would be very intrigued to see if one of our vendors goes down this road. The challenge in the Canadian market is would the physicians see Wal-Mart as a credible alternative to provincially certified vendors. I’m not sure cost is the only selling point for the certified vendors, but as much has to do with the market perception of interoperability with existing provincial IT systems. What value is an EMR to a physician if they cannot interop and exchange data with a provincial lab program, or exchange data with other IT systems? True transparent interoperability with provincial IT systems is a work in progress, but the issue has more to do with the future “promise” instead of the current reality.

    Mark

  2. I would imagine that the interoperability issue exists in the US as well. US physicians still need to get lab results, discharge reports from hospitals, make referrals, etc.

    I also argue that the integration issue is best solved through standards and conformance testing, not by limiting the number of vendors. I know this view runs counter to the prevailing approaches in the Canadian market but I also think that the situation is not yet set in stone in Canada.

    Finally, whether the Wal-mart approach is appropriate for Canada or not, I argue that those vendors not selected for inclusion in a provincial funding program will find other ways to go to market, whether it be through a retail outlet such a Wal-mart or a free, advertising supported on-line service, or something we haven’t yet seen.

    Mike

    • Interoperability would also be an issue in the US. I would argue that over the long run it would be even bigger than in Canada because of the multi-payer environment.

      As far as the Wal-mart issue in Canada, it is interesting indeed. Non-certified vendors in Canada will be challenged in selling directly to RHAs considering the potential healthcare IT cutbacks that are inherent in a recessionary environment. Distribution channel is one weapon to make sales, but the harder one will be in getting the CDN physicians to notice them ahead of the certified vendors who have a 70% price advantage. Although this market is not all about price, I would argue that is rapidly moving to being one of the primary decision criteria.

      Mark

  3. My gut tells me that some other model besides provincially led initiatives is going to emerge in the Canadian EMR market. It is simply too early in the adoption cycle and there is still too much market share up for grabs for those who didn’t win a provincal procurement to fold up their tents and go home.

    Mike

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