Health-Care VARs Win With Electronic Medical Records Solutions

Num Pisutha's father was a doctor and other members of his family worked in medical professions. So it's no surprise that Pisutha would become ... a solution provider.

A solution provider in the health-care field, of course, implementing and supporting electronic medical record (EMR) systems in physician offices in 30 states. "It's a challenge and it's a lot of work," Pisutha said. "I think there's a lot of opportunity, but it also takes a lot of investment."

It's an investment that's beginning to pay off for those solution providers like Pisutha's Dardenne Prairie, Mo.-based Curas that are now pursuing the EMR market. Outpatient physician offices, those with a single doctor to group practices with 10 or 12, remain one of the least automated, most paper-intensive professions.

While many use computer systems for tracking patient appointments and billing, only 10 percent to 20 percent of the 200,000 physician offices in the United States with 10 or fewer doctors have installed EMR systems, also known as electronic health records, used to maintain patient medical information such as notes from doctor exams and surgical procedures, test results and prescriptions. But that's changing.

"EMR has got to be 35 to 40 percent of our business," said Sandy Higgins, sales and support vice president of Computer Zone, a Rockingham, N.C.-based solution provider. Computer Zone provides doctors with a range of IT services and applications including physician office automation systems (such as patient scheduling and billing) and, starting six years ago, EMR.

"I see in the next five to 10 years you'll see [doctor] offices installing EMR the way they have electronic billing today," said Robert Ontolchik, president of Maritec Medical Systems, a Westlake, Ohio-based solution provider that implements EMR and office automation systems in physician offices in Ohio, Michigan and California. "There's tremendous potential for EMR," he said.

A Growing Market

The electronic health record IT market is growing 15 percent a year, according to market researcher International Data Corp., and will reach $4.85 billion by 2015. EMR applications designed for physician offices can start as low as $5,000, but generally cost at least $20,000 and can run up to $50,000 or more, Ontolchik said.

A combination of forces is driving the demand for EMR systems. Government policy and regulations are one factor.

One of the biggest drivers has been legislation that allows hospitals to help physicians cover part of the cost of implementing EMR systems. The legislation, passed by Congress in August 2006 to encourage EMR system adoption, permitted hospitals to help fund up to 85 percent of the cost of EMR technology purchases by physicians in their service areas without incurring penalties under the 35-year-old Stark antikickback statute.

EMR system adoption is also being driven by such government programs as the Medicare program's Pay-for-Performance ("P4P") initiative that rewards doctors for improving the quality and efficiency of the health-care services they deliver. Electronic health records are seen as critical to meeting P4P goals because they improve physician office efficiency and reduce record-keeping and prescription errors. While the Health Insurance Portability and Accountability Act doesn't mandate that physicians adopt EMR systems, several software vendors and solution providers said that complying with HIPAA without EMR is difficult at best.