Entering a New Era in Electronic Health Record Technology

Entering a New Era in Electronic Health Record Technology

In this whitepaper, we’ll examine how an effective EHR strategy can help providers gain patients, attract clinicians, and improve the financial health of their practice

December 7, 2022

What’s the first software you think of when someone says “Healthcare IT?” For most of us, it’s the electronic health record. For every provider, the EHR is the system of record for both clinical and financial data – and a well-functioning EHR is the platform a provider organization lives in.

The adoption and use of EHRs has been a source of promise… and frustration. Most systems come with usability issues that are a key driver of physician burnout. Exchanging health data between systems can often be a major headache. And EHRs frequently fail to deliver the productivity gains they promise.

But that’s all starting to change.

In this whitepaper, we’ll examine how an effective EHR strategy can help providers gain patients, attract clinicians, and improve the financial health of their practice by achieving four primary goals:

  • Improving patient outcomes
  • Accurately collecting revenue
  • Offering a better patient journey
  • Streamlining the clinician experience

The State of EHR Technology in 2022

 

We’re now entering the fourth wave of EHR adoption, with EHR technology beginning to realize the productivity gains that have long been promised, while also expanding tools outside the core financial and clinical elements of the software. Let’s take a closer look.

 

Stage 1: The Gold Rush

Electronic health record systems have been in use since the 1960s, when they were first introduced at major hospitals like the Mayo Clinic. During the 1990s and 2000s they came into more common use, but they didn’t enjoy widespread adoption until the 2010s with the mainstream adoption of digital technology.

As we all know, the early 2010s were a period of unprecedented technological innovation. Handheld digital devices like the iPhone and the iPad went mainstream, making it easier for healthcare providers to work with health records while treating patients. Cloud services like AWS and Microsoft Azure exploded, enabling EHR providers to move records online. And the widespread adoption of high-speed internet made it possible for providers to integrate the patient journey into EHR systems.

Alongside these innovations, the Affordable Care Act ushered in far wider adoption of EHR systems, often driven by federal subsidies. Alongside the ACA, Congress passed the 2009 Health Information Technology for Economic and Clinical Health Act, allocating $30 billion in incentives to hospitals and practitioners to adopt EHR technology through Medicare and Medicaid.

While these trends kickstarted the process of EHR adoption, the platforms providers adopted in the early 2010s were usually limited in their functionality and often reduced physician productivity. In one 2015 survey, 74% of physicians reported that their productivity was about the same or worse after implementing EHRs – with 46% reporting a clear decrease.

 

Stage 2: EHR Consolidation

As subsidies continued to flow and more and more providers shifted to electronic systems, EHR platforms tended toward consolidation to gain market share. Over a decade of mergers and acquisitions, the number of EHR vendors dwindled from more than 1,000 in 2009 to fewer than 400 in 2019. During that same time period, the number of office-based physicians using an EHR soared, from 48% in 2009 to 90% ten years later.

Over this period, successful EHR platforms grew larger and made meaningful improvements, while those that couldn’t keep up were crowded out of the market. Nonetheless, many EHR platforms continued to suffer from poor usability and interoperability challenges.

 

Stage 3: Provider-Specific Category Winners

With this consolidation, nearly every provider setting and specialty has seen specific EHR platforms rise to the top and emerge as the clear category leaders.

The evolution of the EHR space toward provider-specific platforms has made it far easier for medical professionals to quickly get up to speed in new roles, since they’re already familiar with the most common systems used in their industry.

While some of these platforms have been built organically, many others have grown through consolidation. All are outstanding leaders in their markets, gaining market share by focusing on a specific category and enabling providers to better collect revenue, serve their patients, and grow their practice.

 

Stage 4: Technology Stagnation

As the EHR market moved toward provider-specific platforms, it generated significant improvements for each provider setting. But EHRs still weren’t delivering on their ultimate promise: improved outcomes, a better clinician experience, and an easier patient journey. As a result, through the late 2010s, many major vendors steadily lost market share.

These failures were driven by a number of factors that prevented EHR platforms from keeping up with consumer needs and technology trends:

  • Inadequate integrations. One of the key benefits of EHR technology is the potential to deliver better patient care, improve outcomes and optimize charge capture by integrating practice management and EHR systems. EHR platforms that don’t deliver adequate integrations due to a legacy tech stack can’t deliver on this promise.
  • Continued reliance on on-premise software. Through the 2010s, the healthcare market shifted dramatically toward cloud-based EHR solutions. EHR systems that still rely on on-premise software are expensive, difficult to maintain and install, resource intensive, and behind the curve of current market expectations.
  • Lack of specialization. As the market has matured, providers have moved away from generic EHR platforms to specialized solutions appropriate to their clinical setting, specialty, and patient engagement preferences. One-size-fits-all platforms are failing to keep up.
  • Poor interoperability. Successful EHR platforms must be able to meet the advanced needs of settings like patient-centered medical homes and integrated delivery networks, while also meeting government regulatory requirements.
  • Ineffective patient journey. It’s 2022. Successful EHR solutions empower patients to provide information, complete forms, pay bills, view results, talk to their providers, and more. Patients expect to be able to interact with clinicians online, on-demand, and many next-gen EHRs can offer these capabilities.
  • Insufficient analytics. An undisputed benefit of EHRs is the ability to help providers become more successful with data – not just by collecting better analytics on their patient population, but also by gathering metrics like patient throughput and clinician productivity that can make their practices more successful. EHRs that don’t offer robust analytics are missing a key product capability.

 

Stage 5: Realizing The Promise of EHRs

As we enter the early 2020s, we’re seeing a reversal of these challenges across the industry. Many of the leading EHR providers are investing in extensive updates of their platforms to modernize their capabilities and bring them into line with market expectations.

Modernizing the EHR infrastructure of the healthcare system is the key to solving some of the most intractable problems in healthcare:

  • Collecting revenue reliably. To run a financially healthy practice that attracts top talent and opens up access to care, providers need to reliably collect revenue. Effective EHR systems can help providers build a predictable, sustainable business model.
  • Reducing clinician burnout. Long hours and intense stress deter many students from considering a career in medicine. Effective EHR systems designed with usability in mind can mitigate burnout and attract more people to careers in healthcare.
  • Driving better outcomes. You can’t improve what you don’t measure. Widespread adoption of EHR platforms will help us move toward a future in which quantitative data delivers better patient outcomes.
  • Improving access to the healthcare system. Technology is a critical tool for putting healthcare within everyone’s reach. Without platforms that make care easy to access, vulnerable populations will continue to struggle to get high-quality care.

Today’s leading EHR companies are tackling significant challenges. They won’t be solved overnight, but we’re excited to be entering a new stage of medical technology where finding solutions to these problems is the primary focus.

 

The Future of EHR Technology

 

At Serent, we’re excited to be a part of the digital evolution taking place in the EHR space (and within healthcare IT more broadly). Over the coming years, the next generation of company founders will enable providers to reliably collect revenue, improve access to care, and deliver better patient outcomes – all while reducing burnout for healthcare professionals and helping to solve the staffing challenges facing the industry. We’re thrilled to play a role in equipping healthcare providers with platforms that make their lives easier – and excited to partner with the forward-looking founders and companies that are building them.

 

Explore Serent’s Healthcare Investments

Serent Capital invests in growing businesses that have developed compelling solutions that address their customers' needs. As those businesses grow and evolve, the opportunities and challenges that they face change with them. Principals at Serent Capital have firsthand experience at capturing those opportunities and navigating these difficulties through their experiences as CEOs, strategic advisors, and board members to successful growing businesses. By bringing its expertise and capital to bear, Serent seeks to help growing businesses thrive. Learn more about our portfolio companies.

Disclaimer:

This publication is for informational purposes only, and nothing contained herein constitutes an offer to sell or a solicitation of an offer to buy any interest in any investment vehicle managed by Serent Capital or any company in which Serent Capital or its affiliates have invested. An offer or solicitation will be made only through a final private placement memorandum, subscription agreement and other related documents with respect to a particular investment opportunity and will be subject to the terms and conditions contained in such documents, including the qualifications necessary to become an investor. Serent Capital does not utilize its website to provide investment or other advice, and nothing contained herein constitutes a comprehensive or complete statement of the matters discussed or the law relating thereto. Information provided reflects Serent Capital’s views as of a particular time and are subject to change without notice. You should obtain relevant and specific professional advice before making any investment decision.
Executive endorsements of Serent Capital are for illustrative purposes, designed to attract business development contacts, and should not be construed as a client or investor testimonial of Serent Capital's investment advisory services. All such endorsements are from current or former portfolio company leadership about Serent Capital’s ability to provide services to their companies. Certain executives are also investors in Serent Capital’s investment vehicle(s), and as such, there is an inherent conflict in that those executives have an incentive to provide favorable reviews of Serent Capital’s business practices for the benefit of the investment vehicles that they hold a personal ownership interest in. Serent Capital has not, directly or indirectly, paid any compensation to such individuals for their endorsements.
Certain information on this Website may contain forward-looking statements, which are subject to risks and uncertainties and speak only as of the date on which they are made. The words “believe”, “expect”, “anticipate”, “optimistic”, “intend”, “aim”, “will” or similar expressions are intended to identify forward-looking statements. Serent Capital undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future developments or otherwise. Past performance is not indicative of future results; no representation is being made that any investment or transaction will or is likely to achieve profits or losses similar to those achieved in the past, or that significant losses will be avoided.