Thoughts On The Quality Systems Transaction – What Does It Mean for Ambulatory EMR?

The top news last week was from Quality Systems Inc., which owns physician software vendor NextGen Healthcare Information Systems. The news was that NextGen will acquire HealthFusion Holdings, another ambulatory vendor, for $165 million (NextGen also sold their hospital division to QuadraMed the week before). As healthcare systems are consolidating, we are also seeing the consolidation happen on the vendor side and the payer side. The shrinking healthcare profit margin has an effect on the entire industry.

What is next for the ambulatory space?

  1. Physician Groups Joining Health Systems

As we move towards creating a clinical integrated network, the number of physician groups and independent physicians will also decrease where the majority will join an ACO or become an employee for the health systems. The decrease in medical groups and the consolidation of the medical groups will have a huge impact on the ambulatory EMR space. The industry will see a shift in the ambulatory EMR systems transition to the same EMR system that is used by the health systems, so I see a big pickup for the Cerner and Epic in the ambulatory world.

  1. Enterprise EMR

The enterprise EMR will have bigger demands from their clients to focus on the ambulatory side. Health systems are utilizing their technology investments as part of the outreach and growth strategy so it is vital that the clinics and medical groups have a system that fits their workflow. Many industry leading healthcare organizations are becoming a software EMR vendor by providing their ambulatory system to smaller hospitals, rural clinics, and physician groups that cannot afford the technology investment of an enterprise system.

This will be a very interesting space to watch in the next year. We’ll see which players will survive and see what their strategies will be moving forward. I have been providing advisory services for many health systems in regards to their strategy for maximizing their technology investment and making it a revenue-generating tool. So I will be keeping a close eye on this space and sharing insights with you on CXO Scene going forward.

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About the author

David Chou

David Chou

David Chou is the Vice President / Chief Information & Digital Officer for Children’s Mercy Kansas City. Children’s Mercy is the only free-standing children's hospital between St. Louis and Denver and provide comprehensive care for patients from birth to 21. They are consistently ranked among the leading children's hospitals in the nation and were the first hospital in Missouri or Kansas to earn the prestigious Magnet designation for excellence in patient care from the American Nurses Credentialing Center

Prior to Children’s Mercy David held the CIO position at University of Mississippi Medical Center, the state’s only academic health science center. David also served as senior director of IT operations at Cleveland Clinic Abu Dhabi and CIO at AHMC Healthcare in California. His work has been recognized by several publications, and he has been interviewed by a number of media outlets. David is also one of the most mentioned CIOs on social media, and is an active member of both CHIME and HIMSS. Subscribe to David's latest CXO Scene posts here and follow me at Twitter
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