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Cerner Corp., Siemens negotiations center on medical imaging

Following Cerner's $1.3 billion acquisition of Siemens' Soarian EHR in August, the two companies now are in talks about Siemens selling its RIS (radiology information system) line to Cerner.

In the wake of Cerner Corp.'s $1.3 billion acquisition of Siemens AG's EHR unit, Cerner and Siemens are in talks over Cerner possibly buying Siemens' radiology information system products.

Any such sale could signal even tighter integration between Cerner and Siemens' remaining health products, and could pose more competitive challenges to Cerner rival Epic Systems Corp.

The Siemens radiology information system (RIS) offerings are grouped in the syngo line of medical imaging software, and are part of the German conglomerate's Healthcare USA company in Malvern, Penn.

The Siemens EHR, Soarian, was part of Siemens Health Services, also formerly based in Malvern.

Cerner executive acknowledges talks

"RIS was not part of the original deal. It is an ongoing process," Zane Burke, Cerner Corp. president, told SearchHealthIT.

Nothing is settled yet. And it also appears there is confusion among Siemens customers over whether Siemens RIS systems were part of the original deal struck in August that roiled the health IT industry by creating a new number one in the business, with the augmented Cerner possibly surpassing Epic in size.

Siemens customers wonder

Siemens customers want to know, "What's my future? Who owns this?" Kent Gale, chairman of the board and founder of vendor performance rating firm KLAS, told SearchHealthIT at the College of Health Information Management Executives 2014 Fall CIO Forum in San Antonio.

Siemens Healthcare spokesman Lance Longwell declined comment in an email, saying: "Siemens does not comment on market rumors."

But if Cerner -- which has a basic back-end PACS that conceivably could be strengthened by linking it to the Siemens RIS -- does acquire more Siemens products, it could give the EHR vendor, based in Kansas City, Mo., vendor access to some 100 Siemens RIS customer sites, according to Joe Marion, a medical imaging expert.

Industry expert analyzes implications

"My suspicion is there is debate going on within Siemens right now about this, that they're kind of weighing the pros and cons," said Marion, principal of Healthcare Integration Strategies, LLC, based in Waukesha, Wis.

For its part, Cerner is expected to replace its Soarian clinical EHR with its own Millenium EHR platform, while integrating the respected Soarian financial portion with the Cerner EHR. Soarian customers, many of whom are presumably using Siemens syngo systems, could be nudged toward Millenium, Marion said.

"The RIS is an interesting twist," Marion said.

For one, RIS is a dying technology, Marion and other industry experts say, one that is largely being replaced by modern EHRs and PACS no matter which proprietary medical image-producing hardware products they are attached to.

"RIS are going away. Their primary existence in the past was for order management, receiving and assigning orders," Marion said. "Now, if EMRs are the primary point of order management, what's left for RIS?"

As for the price on any RIS deal, Marion said it would be far lower than the Soarian sale. The real money in it for Cerner would be recurring service revenues from Siemens RIS customers.

"It's a question of whether Siemens really wants to give that up," Marion said. "They'll have a big bargaining chip."

More Cerner-Siemens deals ahead?

Meanwhile, an RIS acquisition or further product and service integration and collaboration between Cerner and Siemens would not be surprising, given the statement from Neal Patterson, Cerner Corp.'s chairman and CEO, at the time of the Aug. 5 acquisition of the former Siemens EHR unit.

"The alliance we're creating will drive the next generation of innovations that embed information from the EMR inside advanced diagnostic and therapeutic technologies, benefiting our shared clients," Patterson said in the official Cerner release.

Let us know what you think about the story; email Shaun Sutner, news and features writer, or contact @SSutner on Twitter.

Additional reporting was contributed by SearchHealthIT News Director Don Fluckinger.

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