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Tread carefully when choosing an EHR vendor

This is a crazy time for electronic health record (EHR) software vendors. It smacks of the Web boom of 1998-2000, where sites like Pets.com, grocery home-delivery site Webvan and eToys rose to prominence and quickly flamed out, despite hundreds of millions of dollars in venture backing. Those of us who can even remember Pets.com — and its funny sock-puppet mascot — laugh at the absurdity of the excesses of those times. Our household contributed to Pets.com’s demise, ordering 35-pound bag after bag of dog food, which the site happily shipped for free. Free to us, that is; it turned out the site was kind of a Ponzi scheme, with the stockholders left holding the bag. Similar stories repeated themselves all over the Web, including Value America, well chronicled in David Kuo’s book dot.bomb.

Ten years from now, what will we think of this period in regards to EHRs, as the health care system builds out its IT infrastructure? There are so many choices, from roll-your-own open source software packages to full-boat installations from vendors like Epic, that many EHR vendors are guaranteeing meaningful use certification in hopes of gaining a competitive advantage.

That sounds like a plausible thing to do, except that meaningful use has not been officially defined yet, and depending on how the rules evolve throughout the rest of this year, software vendors might need an awful lot of programming and testing firepower to make good on those guarantees. That will cost money, and something’s got to give: My crystal ball is saying that some smaller vendors will be covering some of their customers’ incentive payments.

That’s the part vaguely reminiscent of the Web boom, although as of this date, no EHR vendor is using a sock puppet for a mascot.

The tough part for physicians still marooned in paper record-keeping processes is choosing an EHR vendor. It probably feels a little like speculating on dot-com stocks felt like a decade ago: How does one settle upon a company that not only feels your pain of implementation and can support that process, but will also still be in business to usher you into full meaningful use compliance by 2015? For some software startups, five years may as well be a millennium.

In our formal interviews and informal conversations with experts — consultants, analysts, economists and IT leaders for health care providers — a few pieces of advice keep getting repeated: One, check out what your area’s regional extension center will be recommending, as it builds relationships with vendors. Two, try and choose a vendor that has a customer base of providers like you in size and practice. Three, talk to your friendly local health care information exchange, and ask what EHR works best with its system. And four, consider a company that has solid financials.

Last month at HIMSS10, Dell announced a partnership with the American Medical Association to provide EHR implementation services. While our mention of it shouldn’t be construed as an endorsement, it’s arrangements like these that have more financial backing than the typical startup. An established company like eClinicalWorks also has an edge over startups, because it’s been around for 10 years and has made inroads into the small-practice market. Epocrates built a great reputation for serving the solo doc with its drug-interaction database over the last decade-plus. Salesforce is hosting PracticeFusion’s EHR system on its Force.com cloud platform, and that company also has a proven track record.

We’re not pretending to know the future, and this isn’t to say that some innovative startup won’t rise up and take over the market with an elegantly designed, perfectly priced EHR package that will blow away the competition. But when choosing an EHR vendor, don’t forget to take into account the long-term prospects of your potential choices. Because even if a candidate has what looks to be an ideal software application, if that company flames out like Pets.com and you have to start from scratch with a new EHR a couple years from now, that could be much more painful than picking the runner-up, even though that EHR system has a few warts.

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