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In EMR Market Share Wars, Epic and Cerner Triumph Yet Again

Analysis  |  By Mandy Roth  
   April 30, 2019

Epic experienced the greatest gains overall last year, largely influenced by M&A activity among provider organizations.

The market share battle among electronic medical record (EMR) providers saw a lot of activity in 2018, much of it stimulated by mergers and acquisitions (M&A) among health systems, as well as a deal finalized between Cerner and the U.S. Department of Veterans Affairs last spring.

Yet after the dust settled, the victors were fairly predictable, with Epic having a slight edge over Cerner in terms of overall market share—28% and 26%, respectively. Epic reigns supreme in the over 500-bed category with a 58% share of the market, compared to Cerner's 27%.

KLAS, the Salt Lake City-based research and insights firm, released its annual report today, U.S. Hospital EMR Market Share 2018, detailing the ups and downs of activity in this competitive market sector. The report is based on based on acute care EMR purchasing activity in the U.S. last year, characterizing 2018 as the "the busiest of the past three years."

Thanks to government contracts, including the V.A. deal, during 2018 Cerner signed the largest number of new hospitals, totaling 177 contracts, including integrated delivery networks, standalone hospitals, and customer add-ons. This is the second consecutive year the company has led market activity. However, due to customer attrition of 77 accounts, Cerner's net gains fell behind Epic, which added 122 contracts and lost one.

When factoring overall wins and losses for U.S. acute care hospitals, Epic led the pack, gaining 121 accounts, Cerner added 100, and athenahealth won five new contracts overall. The remaining players logged overall losses with Allscripts down by 28 hospitals, MEDITECH dropping 18, CPSI losing 6, and MEDHOST down by 5. eClinicalWorks neither gained nor lost accounts in 2018, according to the report.

Epic Reigns in the Large Hospital Sector

According to the report, "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."

Only four vendors provided service to hospitals in the over-500 bed sector in 2018:

  • Epic has 163 hospitals
  • Cerner has 77
  • Allscripts  has 16
  • MEDITECH has 12

"Of these," says the report, "only Epic and Cerner have had net positive changes in market share among large hospitals (500+ beds) over the last decade."

The M&A Factor

The report also addresses the impact M&A activity among provider organizations has had on EMR vendors.

"As large health systems have expanded their reach into new geographic areas, Epic has been the primary beneficiary of this standardization," the report states. Cerner came out ahead as well, 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," says the report. "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."

2018 Market Share by Vendor

The report summarizes 2018 market share of 5,447 acute care hospitals in the U.S. as follows:

  • Epic 28%
  • Cerner 26%
  • MEDITECH 16%
  • CPSI 9%
  • Allscripts  6%
  • MEDHOST 4%
  • athenahealth2%
  • None/other 9%

Further details are available by downloading the report.

How Information is Gathered

The KLAS report is based on acute care EMR contracts executed in the U.S. January 1 through December 31, 2018. The data comes from multiple sources, including publicly available information and conversations KLAS representatives have with provider organizations. KLAS also gives vendors the opportunity to report their annual inpatient hospital EMR wins, which are then validated with provider organizations. This report includes EMR market share data for acute care hospitals and for non–acute care specialty hospitals, including psychiatric, long-term acute care, rehabilitation, and other specialty hospitals, such as surgical and orthopedic hospitals.

Mandy Roth is the innovations editor at HealthLeaders.

Photo credit: Shutterstock

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