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New Epic EHR systems to carry lower prices, aimed at smaller hospitals

New, more minimalist versions of the Epic EHR system will feature lower prices, though also less functionality. And these will be aimed at smaller hospitals, according to Epic.

New Epic EHR systems currently in development will come with lower price tags and will target smaller healthcare providers that have not traditionally been within Epic's orbit.

The moves by Epic Systems Corp. mark the first time the company -- known for its large, expensive, comprehensive and sometimes difficult-to-install systems -- has eyed down-market opportunities.

The two main new Epic EHR platforms are named Utility, a moderately smaller version of the larger Epic ecosystem the company now refers to as All Terrain, and Sonnet, a more significantly slimmed-down implementation of All Terrain with many fewer modules, according to the Verona, Wis., company.

"What that allows us to do is have a shorter implementation, reduce maintenance and also have a lower price point," Adam Whitlatch, Epic's director of research and development, told SearchHealthIT.

Sonnet users will also have a "clear upgrade path" to the larger Utility and All Terrain Epic EHR systems, Whitlatch said. Larger health systems will also be able to install Sonnet in a section of their systems while using a configuration of the larger All Terrain offering in the rest of their network, he said.

In the meantime, Whitlatch said the new product offerings will target critical access hospitals, physician practices and post-acute care facilities, such as rehab hospitals -- a market that will pit Epic more directly against vendors such as athenahealth Inc. and Greenway Health LLC.

Whitlatch declined to talk about pricing strategy, or identify specifically which features, capabilities or modules would not be available in Sonnet and Utility. However, he noted that data analytics and population health will be included in both. He said both new systems will be ready sometime this year.

Epic EHR systems are among the most costly available for midsize to large healthcare systems and, in the ambulatory sphere, larger physician practices.

Epic EHR systems are typically found at the country's biggest and most prestigious academic medical centers and integrated delivery networks.

Boston-based Partners HealthCare spent about $1.2 billion upgrading its hospital system to Epic over the past few years. Hospital officials blamed the installation and associated training and other costs for part of the healthcare system's operating loss last year.

Epic's biggest rival, Cerner Corp., was part of a group that beat out Epic and its partners to win a more than $4 billion Department of Defense (DOD) EHR contract in 2015 -- a development some in health IT thought could have caused Epic to rethink its pricing strategy.

Nancy Fabozzi, a health IT analyst at Frost & Sullivan, said Epic's initiative to strip down and cut the price of its EHR systems, and orient them toward the smaller hospital market, is a smart move.

It's still the same Epic. It's still the same fully integrated, inpatient-outpatient system with revenue cycle management, patient portal, and [it's] still based on the patient being at the heart of the system.
Adam Whitlatchdirector of research and development, Epic

Fabozzi said she sees the new strategy as a simultaneous reaction to instability in the health IT market caused by the changeover in the government administration and losing the DOD contract to Cerner.

"I think this is really good news. It's really important to be flexible on pricing to deal with uncertainty," Fabozzi said. "We don't know where IT budgets are going, and they're addressing a critical complaint about Epic -- that it's too expensive."

While potential users who have long wanted to look at an Epic EHR but couldn't afford it will soon have the opportunity, Fabozzi said Epic should also now refocus on improving usability and interoperability.

"We still need to make it easier to use at the point of care," she said.

Whitlatch said Epic scores high in usability in market surveys, noting that the new Epic EHR systems are based on the same software architecture as the big Epic systems.

"It's still the same Epic. It's still the same fully integrated, inpatient-outpatient system with revenue cycle management, patient portal, and [it's] still based on the patient being at the heart of the system," he said.

Epic CEO Judy Faulkner first disclosed plans for slimmed-down Epic EHR systems at the HIMSS 2017 conference in Orlando, Fla.

Next Steps

Epic vice president says common policy framework needed for interoperability

Challenging Epic installation at Massachusetts hospitals

Cloud EHR vendor athenahealth moves into community hospital market with acquisition

Dig Deeper on Electronic health record (EHR) implementation

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What do you think of Epic's move to offer lower cost EHR systems?
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RLMC is a critical access hospital located in Northern MN who wants to remain independent of larger organizations.  This is what we have been waiting for.  Do you  have a release date?  
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