the big mega hit purchasing report peer60 ......the big mega hit purchasing report peer60.com 2 2016...

peer60.com 1THE BIG MEGA HIT PURCHASING REPORT

THE BIG MEGA HIT PURCHASING REPORT peer60.com 2

2016 mindshare data on all top vendors in EHR, population health, patient engagement, data security, enterprise analytics and revenue cycle management.

Healthcare IT purchasing intentions by provider titles.

Healthecare IT purchasing intentions by hospital size.

Individual vendor data, including mindshare and renewal rates in EHR, population health, patient engagement, data security, enterprise analytics and revenue cycle management.

List of hospitals associated with study participants.

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Executive SummaryVendors Covered In This ReportDemographicsWhat’s on the Purchasing Radar?Trends in Vendor MindshareTrends in EHR EHR Mindshare EHR Replacement Market Inpatient EHR - 2016 Mindshare Inpatient EHR - 2016 Replacement Market Outpatient EHR - 2016 Mindshare Outpatient EHR - 2016 Replacement MarketTrends in Population Health Population Health Mindshare Population Health - Growth Opportunities and Replacement RatesTrends in Patient Engagement Patient Engagement Mindshare Patient Engagement Growth Opportunities Patient Engagement Replacement MarketTrends in Data Security Data Security Mindshare Data Security - Replacement MarketTrends in Enterprise Analytics Enterprise Analytics Mindshare Enterprise Analytics Growth Opportunities Enterprise Analytics - Replacement MarketTrends in Revenue Cycle Management Revenue Cycle Managment Mindshare Revenue Cycle Managment - Growth Opportunities Revenue Cycle Managment - Replacement MarketConclusionVendors Mentioned Less Than 3%

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CONTENTS


As we’ve begun trending patterns in healthcare IT, one thing is clear--purchasing intentions are fluid. This does not mean we see a complete shake-up of priorities, but when any key element of this market, such as data security, rises from the bottom of the priority list to right near the top, it’s a trend that’s impossible to ignore. Give enough motivation to any segment in IT, and overnight, it can become a top priority among providers. It was just a few years ago that EHR was all the rage as the government decided to play good cop, bad cop with Meaningful Use. What happens when providers are presented with both a carrot on a string (incentives) and a long stick (penalties) hanging over their heads? Universal motivation for good and for ill.

The push past the basics of Meaningful Use towards value-based care is quickly becoming a national priority. These changes essentially pick the winners and losers among the different IT segments, with population health and patient engagement filling the vacuum left by an EHR market that is largely satiated. Before you roll your eyes, let’s not mistake EHR adoption with satisfaction, but with significant growth occurring in what have been considered ancillary markets, it’s interesting to see the tug-o-war between large enterprise vendors that offer the appeal of a universal platform across all segments and the best of breed vendors who have been enjoying some healthy growth in these two areas. As adoption rates continue to rise in these and other areas (i.e. enterprise analytics) the battle between these two groups is going to heat up. What happens when tension builds in business? Like letting steam out of a teapot, mergers and acquisitions are often the release valve.

On another note, if you’re attending HIMSS this year, drop by and visit with us for a few minutes at booth #1259. We’re keenly interested in your perspective plus we’re working on some interesting new research this year that is sure to shake up the status quo.

**Disclaimer: From time-to-time report readers question some of the findings in our reports. The usual suspects are (1) “That vendor doesn’t have a solution in this space.” or (2) “This vendor should have higher (or lower) reading in your data.” The reality of our reports is this--we ask specific questions to key, decision-making providers, and they are gracious enough to offer unfiltered feedback. It’s not our job to question their responses. Let the data speak for itself.

Author: Chris Jensen

EXECUTIVE SUMMARY


VENDORS COVERED IN THIS REPORT


With the amount of influence CEOs and CIOs have over healthcare IT purchasing decisions, we were pleased with the demographic breakdown, with over 50% coverage between these two groups. That said, we don’t minimize the impact of hospital leadership from the other categories in this report, as they altogether paint a complete picture of the trends in purchasing IT solutions.

Note: For simplicity in viewing the data throughout this report, we have included under the CEO category, presidents and other high-level, leadership that serve in similar capacities.

**For simplicity in viewing the data throughout this report, we have included under the CEO category, presidents and other high-level, leadership that serve in similar capacities.

DEMOGRAPHICS

Participants by Title


It’s worth noting that this is the first year we are trending healthcare IT purchasing data between 2015 and 2016. Our initial takeaway is of the 567 responses we received from hospital leadership, only 1 in 4 participants were part of both studies. This occurs because a high percentage of participants from last year’s study have already completed their intended purchases and are no longer in the market for items indicated in that report. This is significant for the sake of this report because going back to the same well introduces a high potential for biases or just plain stale data. With 3 out of 4 new participants this year, it becomes more realistic to view the data as having statistical significance with trends between both years.

Participated in 2015 purchasing study


At first view, it may appear that the sample is heavily weighted to smaller bed size hospitals. However, given the number of beds each category represents relative to the percent of coverage in this report, there is reasonable representation among all groups.

Participants by Organization Size


What areas of healthcare IT do providers feel the greatest need to address this year? Population health and patient engagement are the hottest areas by a wide margin, though even the hottest markets are prone to some cooling as we are seeing with decreasing purchasing intentions figures year-over-year. It’s really no surprise these two segments continue to lead the way among hospital IT upgrades considering their impact on successful migration to value-based care and value-based purchasing. If adoption of these models are to succeed, a better pulse is needed on patients (pun not intended), individually and as populations.

Readers who remember our report from last year may recall that we had a combined EHR figure. For this year’s study we broke up EHR into inpatient and outpatient. That said, the combined EHR figure may be misleading. It’s not as simple as adding the inpatient EHR figure (9%) with the outpatient EHR figure (10%), which would result in 19%. In the 2015 study we simply asked whether or not participants were planning on purchasing a new EHR solution, irrespective of in- or outpatient variations. A decent number of participants this year selected both in- and outpatient EHR as areas that need to be addressed. However, to maintain consistency in the combined EHR figures, we didn’t count these responses twice.

Also noteworthy is the (long overdue) jump in priority placed on data security from last year. In 2015 it was at the bottom of the list of top IT priorities and placed third this year. Since this is not a growth market with 90% of hospitals already employing a true data security solution, the jump in interest in this area likely means the replacement market for more robust solutions in this very critical segment is heating up. Who stands to win or lose business? Answers to this question are located in the premium content portion of this report.

WHAT’S ON THE PURCHASING RADAR?


2016 Healthcare IT Purchasing Plans

Purchasing Plans - Year-Over-Year

24%

23%

12%

13%

13%

13%

1%

22%

20%

16%

13%

15%

14%

2%


How many vendors can rent space in the minds of decision-making providers? We know, sounds like a joke waiting on a punchline, but there are limits to how many vendors are seriously considered when providers are making buying decisions. This is mindshare--who occupies serious space in decision-makers’ minds. Our frequent readers will recall the correlation we share between market share and mindshare. Market share is a lagging indicator, showing the fruits of actions already taken. Mindshare is a leading indicator showing what is likely to happen in the future due to current vendor actions.

What actions increase mindshare? It could be product innovation, competitive price adjustments, improvements in customer and account services, innovative and memorable marketing and branding, etc. The list is lengthy. However, in an industry that has a basket of choices for just about every segment, there is often a view of parity among the many vendors. In conducting frequent research on vendor positions in the marketplace, it becomes very apparent why certain vendors shine while others fade. Top vendors obsess over what providers are thinking and feeling and then doggedly pursue it. This is true both of their clients as well as the market at large.

Forgive us for climbing on our soapbox for a moment, but to truly understand what providers are both thinking and feeling requires deliberate and frequent actions. Believe us when we say vendors that end up living in providers’ grey matter shortlists do not get there by accident. If you want to control the output obsess over the input. With that point, vendors who make strategic decisions primarily on third party industry reports (including this report) and farmed-out market research to firms that anonymize the data and control your company’s public narrative, will alienate themselves from their customers and the market. Simply put, it’s a cop-out.

Just like drinking spring water close to the source avoids contaminants, staying close to providers and validating what they are thinking and feeling has a greater impact on buying and renewal decisions than any other component because vendors instinctively make course corrections when feedback is coming directly from the source. Vendors that rely almost exclusively on information passing through third parties will struggle to achieve this level of interaction with providers. We see it happen time and again, and it’s happening to vendors covered in this report as displayed by declines in mindshare figures. Ok, enough preaching...

TRENDS IN VENDOR MINDSHARE


EHR MINDSHARE

TRENDS IN EHR


EHR - Mindshare Year-Over-Year

EHR - MINDSHARE YEAR-OVER-YEAR

We are seeing greater separation between EHR mindshare “have’s” and “have not’s” this year, with Epic, Cerner and MEDITECH dominating the near-term future of this market. However, athenahealth and Allscripts saw their mindshare figures more than double this year compared to last.


Combined EHR - 2015 Replacement Rates

Combined EHR - Replacement Rates 2016

EHR - REPLACEMENT MARKET


INPATIENT EHR - 2016 MINDSHARE

This is the first year, we separated EHR into inpatient and outpatient segments. The trends are largely the same across EHR as a whole and broken out by inpatient and outpatient segments.

2016 Inpatient EHR Mindshare

INPATIENT EHR - 2016 REPLACEMENT MARKET

With EHR at the heart of healthcare IT, it’s no surprise that renewal rate on the inpatient component is 83%+. The pain of working with a mediocre vendor has to reach a breaking point before providers will go through the massive headache of going back out to the market.

Inpatient EHR - 2016 Replacement Rates


OUTPATIENT EHR - 2016 MINDSHARE

In EHR, those that rule the inpatient side, benefit from assumed outpatient EHR business. Pardon the overused metaphor but this is yet another case of the dog (inpatient EHR) wagging the tail (outpatient EHR).

2016 Outpatient EHR Mindshare

OUTPATIENT EHR - 2016 REPLACEMENT MARKET

Same story here in outpatient EHR, not a lot of churn.

Outpatient EHR - 2016 Replacement Rates


Outpatient EHR - 2016 Replacement Rates


POPULATION HEALTH MINDSHARE

TRENDS IN POPULATION HEALTH


As mentioned above, population health solutions are a hot topic, which doesn’t appear to be changing anytime soon. Right or wrong, this is a perfect example of the unintended consequences of government intervention is what has historically been a private industry. One thing’s for sure, vendors in this space are not complaining. With that in mind, enterprise vendors must innovate on this front to keep their clients from going a la carte with best of breed vendors in these key growth markets. Nothing annoys providers more in IT than purchasing a top enterprise EHR solution that provides modules for other key components such as population health only to find the module has been developed more as an afterthought than an integral component.

Fortunately for best of breed vendors, population health is still a growth market with 1 in 3 hospitals still operating without a solution. As adoption rates continue to rise, speciality vendors in this space that don’t offer true competitive advantages are destined for acquisitions or slow painful declines to irrelevance. For now, it appears the top best of breed vendors in this space are seeing more attention from providers in this space (year-over-year) than are enterprise vendors.

Population Health - Mindshare Year-Over-Year

17%

14%

16%

8%

9%

5%

3%

3%

9%

1%

2%

17%

13%

13%

9%

7%

6%

6%

5%

5%

4%

3%

POPULATION HEALTH - MINDSHARE YEAR-OVER-YEAR

This premium content is reserved for peer60

clients & study participants.Visit www.peer60.com/joinus to find out more.


2016 Population Health Adoption Rate

POPULATION HEALTH - GROWTH OPPORTUNITIES & REPLACEMENT RATES

Among providers who already have population health solutions, there appears to be some stabilization in their plans of renewing contracts with current vendors. Last year approximately 1 in 4 providers were certain they would keep their current population health vendor, this year that figure increased to 2 out of 4. The pressure is on for vendors that have not already made their mark in this market because they’re about to be squeezed by increasing renewal rates and a declining pool of hospitals that have not already adopted.


Population Health - 2015 Replacement Rates

Population Health - 2016 Replacement Rates


PATIENT ENGAGEMENT MINDSHARE

TRENDS IN PATIENT ENGAGEMENT


Patient Engagement - Mindshare Year-Over-Year

PATIENT ENGAGEMENT - MINDSHARE YEAR-OVER-YEAR

14%

15%

6%

11%

5%

3%

5%

5%

3%

5%

4%

20%

13%

11%

10%

9%

7%

4%

4%

3%

2%

4%

4%

We see the opposite happening in patient engagement compared to population health. More enterprise vendors are capturing more of the minds of providers, while interest in the best of breed crowd is beginning to dwindle. In addition, adoption and renewal rates are higher in this market. These signs point to consolidation among patient engagement vendors. Hello, CPSI’s Healthland acquisition. Who’s on deck?




PATIENT ENGAGEMENT - GROWTH OPPORTUNITIES

PATIENT ENGAGEMENT - REPLACEMENT MARKET

2016 Patient Engagement Adoption Rate

Patient Engagement - Replacement Rates 2015


Patient Engagement - Replacement Rates 2016


DATA SECURITY MINDSHARE

TRENDS IN DATA SECURITY


Data Security - Mindshare Year-Over-Year

DATA SECURITY - MINDSHARE YEAR-OVER-YEAR

29%

18%

16%

12%

3%

4%

4%

30%

19%

11%

10%

7%

6%

4%

What are the mindshare figures in data security telling us? There’s not much to talk about. This is a stable, mature market with clear mindshare leaders. However, one point worth highlighting is FireEye’s big jump (133%) in mindshare from last year and this increase may only increase over the coming year with their recent acquisition of iSIGHT Partners.




DATA SECURITY - REPLACEMENT MARKET

Data Security - 2015 Replacement Rates

Data Security - 2016 Replacement Rates


ENTERPRISE ANALYTICS MINDSHARE

TRENDS IN ENTERPRISE ANALYTICS


ENTERPRISE ANALYTICS - MINDSHARE YEAR-OVER-YEAR

Enterprise Analytics - Mindshare Year-Over-Year

Enterprise analytics is an interesting category because analyzing all types of health information is critical to any organization moving forward towards true value-based care. What’s interesting is that every hospital defines analytics differently - to some a data visualization tool is considered enterprise analytics while to another it’s a full solution that incorporates data warehousing, data modeling, workflows, etc. For the purposes of this study we allowed providers to define it however they like so all of these mindshare figures should be viewed through that lens.

In any event Cerner and Epic swapped mindshare positions for 1st and 2nd place from last year in this incredibly important market segment, cementing these two comfortably in control of this market.

Tableau is obviously taking strategic steps to capture more of this market as is evidenced by their serious jump in mindshare. Fortunately for the best of breed, there is still moderate growth opportunities as adoption continues to grow.

15%

19%

6%

15%

7%

5%

5%

4%

4%

6%

3%

18%

16%

11%

8%

7%

6%

5%

5%

5%

3%

4%




ENTERPRISE ANALYTICS - GROWTH OPPORTUNITIES

ENTERPRISE ANALYTICS - REPLACEMENT MARKET

Do you currently have an Enterprise Analytics solution? (2016)

Enterprise Analytics - 2015 Replacement Rates


Enterprise Analytics - 2016 Replacement Rates


REVENUE CYCLE MANAGEMENT MINDSHARE

TRENDS IN REVENUE CYCLE MANAGEMENT


REVENUE CYCLE MANAGEMENT - MINDSHARE YEAR-OVER-YEAR

There were some significant drops in mindshare among last year’s mindshare leaders. Despite this, Epic and Cerner swapped place but still maintained #1 and #2. Allscripts unseated last year’s #3 mindshare leader in Revenue Cycle Management.

We see an anomaly in revenue cycle management mindshare. Last year, Advisory Board Company, received no mentions as a vendor being considered for a new or replacement contracts among our 965 participants. It seems deliberate actions have been taken to capture more of the market.

Revenue Cycle Management - Mindshare Year-Over-Year




REVENUE CYCLE MANAGEMENT - GROWTH OPPORTUNITIES

REVENUE CYCLE MANAGEMENT - REPLACEMENT MARKET

2016 Revenue Cycle Management Adoption Rate

Revenue Cycle Management - 2015 Replacement Rates


Revenue Cycle Management - 2016 Replacement Rates


While healthcare has been around in some form since the beginning of humankind, many would argue that it’s still in adolescence with healthcare IT still being very much in its infancy. Innovation will continue to happen motivated by additional “governmental encouragement” and patient demand for improved quality of care. For now, this is what’s on the radar among provider organization leadership.

CONCLUSION


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VENDORS MENTIONED LESS THAN 3%

the big mega hit purchasing report peer60 ......the big mega hit purchasing report peer60.com 2 2016...

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