MediNotes Acquisition to Open Doors to Physician Practices

By Neil Versel, contributing editor

Sept. 30, 2008 | With its recently announced plans to take over MediNotes (West Des Moines, Iowa), Atlanta-based hospital systems vendor Eclipsys is making a push into the fast-growing but hard-to-reach market for independent physician practices.

“Our health-system clients have been asking us for an integrated solution with practice management and clinical to ‘gift’ or to recommend to small practices,” says Jay Deady, Eclipsys executive vice president for client solutions. Although Eclipsys claims 2,000 physician users of its Sunrise Ambulatory Care electronic medical record (EMR) software, Deady says the main sales channel is through integrated health systems with high-acuity service lines.

“We have a very segmented coverage model,” according to Deady. “Downsizing Sunrise Ambulatory was not a viable option.”

Seeking to close the gap in its product line, Eclipsys reached an agreement Sept. 19 to purchase privately held MediNotes for $45 million in cash and stock. (See “Deals, Deployments, and Short News,” Sept. 30.) Deady says his company was attracted to MediNotes for its product capability, natively integrated clinical, financial, and supply-chain management components, and the management team, headed by president and CEO Donald Schoen and Travis Bond, the chief strategy officer and executive senior vice president of business development at MediNotes.

Deady says Schoen and Bond will stay on to run MediNotes as a wholly owned subsidiary of Eclipsys, but that the parent company likely will re-brand MediNotes products. Bond joined MediNotes in February when that company acquired Bond Technologies. (See “Deals, Deployments, and Short News,” Feb. 26.)

The dedicated MediNotes sales force, targeting practices with more than five physicians, will report to Schoen. The MediNotes chief also will manage sales efforts aimed at solo practices and very small groups through a network of value-added resellers.

Before the end of the year, Deady hopes to have Health Level Seven messaging links between Eclipsys and MediNotes EMRs. By early spring, interoperability will expand to include additional, unspecified data elements, in preparation for a “deep interoperable stage” the company hopes to reach by early 2010. Deady says he expects the products to exceed the 2009 interoperability standards set by the Certification Commission for Healthcare Information Technology (CCHIT).

Deady says Eclipsys will detail this three-stage integration and development plan at a user’s group meeting next week in Atlanta.

Schoen says most of the integration, as well as ongoing development and CCHIT certification, will take place with MediNotes Clinician, the former Bond Technologies product that includes both EMR and practice management functions. “We believe the whole market is moving toward a suite scenario,” Schoen tells Digital HealthCare & Productivity.

However, there are no immediate plans to discontinue MediNotes e, a stand-alone EMR. Schoen says the company has four years of sales commitments to the e product.

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