Allegheny Health Network becomes client of Epic Systems Corp.

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Allegheny Health Network has begun a multiyear hardware and software upgrade that eventually will link all of the network's hospitals, physician clinics and outpatient centers on a single IT platform.

In so doing, AHN has become the newest client of Wisconsin-based clinical software giant Epic Systems Corp., today the top dog in the hospital information technology realm.

The fully integrated health records system -- the first of its kind in Western Pennsylvania, according to the hospital network -- has the potential to improve the network's efficiency, quality, cost of care, as well as the patient experience, hospital officials say.

And when a health system has been losing money and patients for so long, as has been case with AHN's West Penn Allegheny Health System, there's plenty of room for improvement, said Elizabeth Allen, interim chief financial officer for the network.

The computer system upgrade was quickly identified as one of "a handful of big areas where there are opportunities for improvement," she said. The hardware and server installation is already underway.

AHN finds itself in good company -- Cleveland Clinic, New York's Mount Sinai Medical Center, Yale School of Medicine, the University of Chicago Medical Center, Partners Healthcare in Boston and Kaiser Permanente have all purchased Epic software and hardware over the last 10 years. Many of those hospitals have opted to gut and replace decades' worth of contractor-installed and self-developed legacy systems in favor of a single Epic system.

As a result, Epic has quietly and quickly emerged the top rival for Cerner Corp., Allscripts and Meditech.

Its reputation has grown as health systems have abandoned the practice of installing "best-in-breed" systems -- the best billing software, the best electronic medical record system, the best inpatient workflow software -- and forcing them to communicate with each other. Instead, health systems are now keen on interoperability, and Epic delivers that in a "seamless" package. It was the first health IT firm to figure out how to do so, giving it an instant leg up on its competitors.

It's "the holy grail of what organizations are trying to do," said Kyle Murphy, an editor with HealthIT Analytics. Much like Apple or Google, Epic has its own band of devotees and fan boys, including clinicians as well as executive-suite types who have been sweet-talked by Epic's media-shy founder and CEO, Judy Faulkner.

Epic's system needs a lot of on-site hardware and infrastructure, and as a result is more expensive to install than competitors' systems, but that hasn't deterred high-profile clients from buying whole-system products from Epic, which reported $1.5 billion in revenues in 2012, up 25 percent from 2011.

"It's very costly," Mr. Murphy said. But "it's top of the line ... the Duesenberg" of health IT systems. Highmark is lending Allegheny Health Network $178 million to pay Epic to replace existing systems.

And those systems are varied. AHN was built over two years through a series of shotgun marriages -- West Penn Allegheny Health System is the hub of the new system, and it has been joined by Jefferson Regional Medical Center and Erie's St. Vincent hospital, plus various primary care practices and specialty clinics that have been picked up along the way.

Each often has its own clinical, inpatient, outpatient and revenue-cycle systems, which have been cobbled together and forced to "talk" with each other in order to share data. (UPMC, for example, uses Cerner for inpatient data management, as well as Epic for ambulatory care.)

"Every time you have to create an interface [between systems and providers], it becomes a barrier," said Tony Farah, chief medical officer for West Penn.

If a specialist wants to track down a patient's medical records from a primary care doctor elsewhere in the system, phone calls are made, charts are exchanged. Prescriptions are issued via one system, bills are sent out via another, scheduling on another, radiology on yet another.

It's less efficient than it could and should be, Dr. Farah said.

"As much as we can, we are trying to establish a system that allows us to have all this at our fingertips," he said.

Streamlining how health professionals communicate, schedule patients and make orders is "just some of the basic blocking and tackling" that is common at other hospitals, but has been missing at WPAHS, said Patricia Liebman, chief operating officer at AHN.

"It's been an organization that just hasn't had the disciplined leadership" over the last several years, making such big-picture projects harder to carry out.

In charge of the implementation of this project is AHN's chief information officer, Jacqueline Dailey. She, like Ms. Allen, said the health system's historical woes create an opportunity to start fresh.

"We're a little bit behind on this. But it really is a huge advantage for us," she said. Being late to the game means a lot of the kinks have been worked out, and best practices have been established, at other hospital systems, Ms. Dailey said.

Professionals at AHN will have input as to the final look and function of the system. Already, working groups of nurses, physicians, pharmacists and others are meeting, or will be soon doing so, to discuss the new system, Ms. Dailey said. Higher-level design sessions start in January.

"It is so important for everybody to be on the same page," she said. The goal is a final product that "rethinks the way we work as a health system, [around] our patient," a system that removes health care from its separate silos and better aligns among the dozens of health professionals who might treat a patient over the course of a year, or even during a single hospital stay.

Those health professionals are often familiar with Epic, which was initially best known for its ambulatory -- that is, outpatient -- software suite. "The doctors bring the patients," explained Kent Gale, chair of KLAS Enterprises LLC, an industry research firm.

Once Epic developed the rest of its product lines -- inpatient, revenue cycle, and so on -- it already had built-in credibility with doctors and was an easy sell at large hospital systems, Mr. Gale said. "They all kind of started with an area of strength," but Epic was "the only vendor that really [had] all the pieces," he said.

Eventually, AHN's Epic health records system will be able to communicate with the health information exchange being developed by Highmark and Orion Health, an exchange that will distribute patient data to physicians and hospitals statewide. (Orion replaces Verizon Enterprise Solutions, which was originally tapped to build Highmark's data exchange in 2012.)

AHN's hospitals and clinics will receive the Epic technology over several years. The first to have it fully installed will be Highmark's Wexford Medical Mall, which is now under construction and is scheduled to open in autumn 2014.

Bill Toland: or 412-263-2625.

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