Healthcare giant WebMD may finally deliver on its promise to be a one-stop shop for physician information technology with the recent release of its first complete electronic health-records system to match a previously available practice-management system. Given its late arrival with an EHR product, however, WebMD's challenge will be to create a cost-effective sales and support system to conquer the small-office market, according to at least one industry analyst.
Elmwood Park, N.J.-based WebMD used the Medical Group Management Association meeting last month in San Francisco to execute what it was calling an official launch of its Intergy EHR. Initial sales of the electronic health-record product actually began in July, according to Jennifer Meyer, vice president of corporate communications. Sales of its sister practice-management system, Intergy Practice, began in February 2003, she says.
Tom Stampiglia, president and chief operating officer of the WebMD Practice Services division, says the software was designed to work in a solo-physician practice as well as in large multispecialty groups. Like most IT vendors, however, WebMD will push for sales in the midsize to large medical group market. It will target owners of its older Medical Manager practice-management systems as well as new customers, Stampiglia says. Intergy EHR will sell for $7,500 to $15,000 per physician, depending on the type of hardware requested and storage and server capacity required, Stampiglia says. Annual fees will cost about 20% of licensing fees.
The Medical Manager strategy is solid, according to stock analyst Sean Wieland, who covers healthcare IT companies for WR Hambrecht & Co. But it might be "a little late" for WebMD to break into the EHR market for large medical groups, with competitors Epic Systems Corp., Allscripts Healthcare Solutions and NextGen Healthcare Information Systems already well-established, Wieland says.
Of the larger IT companies, Allscripts already has an EHR product targeted to the small-office market, and NextGen is about to launch one, Wieland says. If WebMD figures out a way to leverage its already extensive penetration into this market through its Web portal, claims processing and practice-management system contacts, the opportunity for electronic health-record sales is tremendous, according to Wieland, who nonetheless recommends that WebMD investors hold their stock.
"They're really trying to get back into the game after sort of losing it for a while," says David Kibbe, M.D., who heads the American Academy of Family Physicians' Center for Health Information Technology. "I just wish them well and hope this works out for all those people who have Medical Manager."