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Analysis: Can Sam's Club bring health care tech to the local doctor?

The retailer offers the technology as SaaS -- at a cut-rate price

May 14, 2009 05:10 PM ET

Computerworld - In two years, the federal government will begin divvying up $19 billion in reimbursement money to help health care organizations and doctors cover roll out electronic medical records (EMR) technology. In the meantime, the cost for the technology, which can run tens of millions of dollars for large facilities and tens of thousands of dollars for private physician practices, rests squarely on the private sector.

Enter Sam's Club. Like the bundled packs of condiments that include ketchup, mustard and relish, the wholesale outlet now allows physicians to add bundled EMR systems to their electronic cart. Last month, the Wal-Mart subsidiary began offering a bundled EMR service that includes software, hardware and technical support in three states -- Illinois, Georgia and Virginia -- as a test bed for offering the software as a service (SaaS) product throughout the U.S.

So far, interest is "extremely strong," said Susan Koehler, a spokeswoman for Sam's Club, although the company could not offer any sales figures.

While it may seem odd for a wholesale retailer to dip its toes into the health care technology market, physician practices that lack any technical support could use a SaaS model to cover the technical aspects of EMRs.

Helping spur the adoption of SaaS models in health care is the U.S. government, which has been ambiguous about which EMR systems will qualify for up to $44,000 in reimbursement funds beginning in 2011, according to Judy Hanover, an analyst on health care information technology at IDC in Framingham. Hanover said that fewer than 10% of private practices have deployed any kind of comprehensive EMR system thus far.

President Barack Obama has said the government's plan under the Health Information Technology for Economic and Clinical Health Act, or HITECH, is to have a nation-wide EMR network in place within five years. EMRs will not only enable the sharing of patient medical information between facilities, pharmacies and laboratories -- ensuring the most up-to-date patient information is available -- but it should help speed care and ensure the use of best practices.

Targeted at private practices with five doctors or less, the Sam's Club service bundles software and support from eClinicalWorks Inc., in Westborough, Mass., with Dell computers.

The software, eClinicalWorks EMR v8.0, is certified by the Certification Commission for Healthcare Information Technology, which is likely to become a prerequisite for receiving the incentive money, Hanover said.

According to the New England Journal of Medicine, physicians who demonstrate "meaningful use" of EMR systems in 2011 can start collecting reimbursements for their costs over five years. If they wait until 2013, the most they could get is $27,000 paid out over three years, a reduction designed to spur doctor's offices to move quickly.

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