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US Hospital EMR Market Share 2019
Significant Movement in Every Market Sector
Author
Coray Tate
Author
Paul Warburton
In terms of EMR purchasing, 2018 was the busiest of the past three years. This energy impacted every market sector, with the US government finalizing contracts, three large health systems changing EMRs, and the small-hospital market continuing to see churn. While the majority of all organizations that made go-forward decisions in 2018—regardless of size or type—chose Cerner or Epic, this does not tell the whole story.
Cerner Signs Most New Hospitals Thanks to VA Deal, Sees Significant Millennium Losses in Private Sector
For the second year in a row, Cerner signed the highest number of new hospitals but—due to customer attrition—came in second in terms of net market share gain. In 2018, Cerner cornered the market on US government contracts, finalizing the VA deal and giving Cerner their biggest net gain of any year KLAS has measured. The VA decision includes 147 acute care and 20 specialty hospitals, accounting for 76% of Cerner’s 2018 hospital wins (government contracts have made up 39% of Cerner’s hospital wins over the past five years). Cerner was chosen by fewer organizations in the private sector, the majority being smaller hospitals. 65 hospitals left Millennium in 2018 (52 of which came from two health systems); the vast majority moved to Epic.
Large Private Hospitals and Organizations Continue to Choose EpicÂ
Fewer large hospitals (500+ beds) and multihospital organizations are making EMR purchases today, but those that do almost exclusively choose Epic. All three of the large, private organizations that made an EMR decision in 2018 went with Epic, switching from Allscripts or Cerner. At this point, most large organizations have invested heavily in implementing a single, go-forward solution across all of their hospitals, so future purchases in the large market will be highly contested and require a significant rip and replace. Four key vendors remain in the large space—Epic (with 163 hospitals), Cerner (77 hospitals), Allscripts (16 hospitals), and MEDITECH (12 hospitals). Of these, only Epic and Cerner have had net positive changes in market share among large hospitals (500+ beds) over the last decade (see chart below).
MEDITECH Expanse Generating Energy and Competition; M&A a Major Reason for Losses
Expanse—MEDITECH’s web-based solution—has proven compelling to both legacy MEDITECH customers and those outside the MEDITECH base. For the second year in a row, a number of organizations outside of MEDITECH’s base—mostly small to midsize hospitals—chose Expanse. In addition, 19 legacy hospitals migrated to Expanse (out of the 53 MEDITECH hospitals that were part of a go-forward decision in 2018). After a net increase in market share in 2017, MEDITECH saw a decrease in 2018. MEDITECH is one of the vendors most impacted by M&A activity among customers: 16 of their 33 hospital losses in 2018 were the result of market consolidation by large organizations.
Allscripts Sees Sunrise & Paragon Losses, Signs Few New Contracts
After a few years of relative market share stability, Allscripts saw increased losses in both 2017 and 2018. In 2018, 14 hospitals—9 of which came from one large organization—left the Sunrise Clinical Manager (SCM) platform; all switched to Epic. 16 hospitals left the Paragon platform, moving to Cerner, Epic, MEDITECH, or CPSI. The Horizon platform (acquired from McKesson in 2017) has been officially sunsetted; 3 Horizon hospitals made go-forward decisions in 2018—none chose an Allscripts EMR. Of Allscripts’ 33 total hospital losses in 2018, 15% were the result of some sort of customer consolidation. In terms of new sales, one small IDN and one standalone hospital chose SCM in 2018, and one athenahealth customer moved back to Paragon. Over the last few years, several specialty hospitals have chosen SCM; many choose the solution for the amount of customization it offers.
athenahealth’s Growth Slows as They Pause Acute Care Sales; Still No Live eClinicalWorks Customers
Many critical access hospitals have chosen athenahealth in recent years, though energy tapered off significantly in the latter half of 2018, with organizations reporting that athenahealth has paused sales and stopped responding to RFPs. athenahealth has indicated to KLAS a commitment to developing the hospital product but has not made a public announcement—some customers report uncertainty; others mention recent version updates and are optimistic about go-forward plans. As in previous years, several customers chose in 2018 to revert back to their previous EMR; reasons vary but include functionality gaps, changes in hospital leadership, and uncertainty about athenahealth’s future. KLAS was unable to validate any new contracts for eClinicalWorks in 2018 (and the vendor did not share a list). The organizations who have contracted for eClinicalWorks’ inpatient system in previous years are still waiting for the initial beta product.
CPSI and MEDHOST Stabilize as athenahealth Pauses Sales to Small Hospitals
CPSI and MEDHOST have been in defensive postures for several years, with Cerner and Epic expanding down from the large space and athenahealth pushing up from the critical access market. However, in 2018, CPSI and MEDHOST both saw a significant reduction in losses. athenahealth’s decision to pause sales of athenaClinicals for Hospitals & Health Systems has reduced pressure, and 7 hospitals that moved from CPSI to athenahealth chose in 2018 to revert back to CPSI. MEDHOST did not share a list of 2018 wins for KLAS to validate, but their market share has historically been more stable; the majority of their market share comes from three large organizations. Small standalone hospitals will continue to have high purchasing energy as customers face consolidation, governmental regulations, and financial pressures.
Acute Care EMR Decisions Today Based Less on Functionality and More on M&A Activity and Regional Affiliates
M&A activity among provider organizations has resulted in regional standardization in some areas of the US, with certain regions being heavily influenced by specific vendors. As large health systems have expanded their reach into new geographic areas, Epic has been the primary beneficiary of this standardization. Cerner has also benefitted, while legacy products from MEDITECH and Allscripts have been the most often replaced.
Mergers, acquisitions, and decisions to standardize to a single EMR continue to be a significant contributor to organizations’ EMR purchases. Since 2014, 20% of acute care hospitals that have switched EMR vendors have done so as a result of M&A activity, and over 50% have done so as part of a broader organization decision. This consolidation—and the desire for easy data sharing—means that acute care EMR purchasing today is less likely to be based on functionality considerations and more likely to be based on factors such as consolidation to a standardized platform or integration with referral organizations. Overall, Epic has seen the most benefit from this M&A and standardization activity.
Writer
Elizabeth Pew
Designer
Jess Wallace-Simpson
Project Manager
Ian Vincent
This material is copyrighted. Any organization gaining unauthorized access to this report will be liable to compensate KLAS for the full retail price. Please see the KLAS DATA USE POLICY for information regarding use of this report. © 2024 KLAS Research, LLC. All Rights Reserved. NOTE: Performance scores may change significantly when including newly interviewed provider organizations, especially when added to a smaller sample size like in emerging markets with a small number of live clients. The findings presented are not meant to be conclusive data for an entire client base.