EHR market consolidates as Allscripts acquires Practice Fusion

Access to small physician practices is the goal

The market for electronic health-record (EHR) systems, aka electronic medical records, remains fragmented and suffering complaints of poor interoperability among vendors; however, both of those conditions might change as one of the industry leaders, Allscripts, agrees to purchase Practice Fusion, for $100 million, in a transaction expected to close in this quarter. “Practice Fusion’s EHR will complement and round out Allscripts existing ambulatory clinical portfolio, providing a value offering and ‘last mile’ reach to the under-served clinicians in small and individual practices,” according to an Allscripts statement.

The action follows on the heels of Allscripts’ acquisition of the Enterprise Information Solutions assets of McKesson, for $185 million, which closed in October. EIS included an EHR platform, Paragon, among other software suites for healthcare-system data management.

According to a year-old survey by SK&A, a market-research unit of IQVIA, Allscripts was the No. 3 provider, at 10.4% of the US EHR market, and Practice Fusion was No. 4, at 6.34%. The market leader remains EPIC (13.54%), and there are hundreds of other providers.

The direct purpose of EHR systems is to enable healthcare delivery providers to automate their recordkeeping and billing. Indirectly, however, EHRs are beginning to represent a gold mine of data on health outcomes, real-world evidence and other analytics. The EHR platforms themselves have also been an increasingly valuable channel for communicating with physicians directly—something that has become more difficult in the era of “no see” physicians whose office setting restrict visits from pharma sales reps.