Long the second fiddle to Epic and losing ground, Cerner will get a much-needed innovation infusion when it's acquired by Oracle, and could give a much-needed boost to the EHR landscape.
Oracle’s pending acquisition of Cerner may have caught many by surprise, but it falls in line with the thought that the EHR market needs to embrace innovation to evolve.
Long the second fiddle to Epic – Cerner had 25% of the EHR market in 2020, compared to Epic’s 31%, according to KLAS Research - the Kansas City-based company had been losing business to its competitor in recent years and was struggling to fulfill contracts with the US Department of Defense and Veterans Affairs. And while the company was securing contracts with smaller health systems who liked the price, critics said the platform wasn’t meeting expectations on the back end, particularly in revenue cycle services.
In Oracle, Cerner is getting a partner with a strong background in finance and operations, and one that wants to make an impact in the busy clinical market. This could shore up the company’s platform and make it more attractive, particularly in the smaller markets and overseas.
In addition, Austin-based Oracle brings expertise in new technologies that will strongly impact the EHR market, including AI, machine learning, data management and cloud computing. Those features could also form the backbone of a more compelling and effective telemedicine offering, with tools in place to develop remote patient monitoring capabilities.
“The future of enterprise software is being able to engage with industry segments,” Bob Parker, an analyst at IDC, recently told The New York Times. “And this puts Oracle deeply into a key part of the healthcare business.”
"With Oracle's resources, infrastructure and cloud capabilities, Cerner will accelerate the pace of product and technology development to enable more connected, high-quality and efficient care," the two companies said in a December 20 press release announcing the deal. "Oracle's focus on usability and voice-enabled user interfaces will dramatically reduce the amount of time that medical providers spend dealing with systems."
“With this acquisition, Oracle’s corporate mission expands to assume the responsibility to provide our overworked medical professionals with a new generation of easier-to-use digital tools that enable access to information via a hands-free voice interface to secure cloud applications,” Oracle Chairman and Chief Technology Officer Larry Ellison added. “This new generation of medical information systems promises to lower the administrative workload burdening our medical professionals, improve patient privacy and outcomes, and lower overall healthcare costs.”
Those functions are important as healthcare looks to move beyond the dark days of the pandemic and adapt to a hybrid care environment that supports both in-person and virtual services. Healthcare providers will need an EHR platform that can seamlessly adjust from one modality to the other, as well as one that can support new digital health tools aimed at reducing workload pressures on providers and funneling data into the medical record.
“Cerner has been a leader in helping digitize medical care and now it’s time to realize the real promise of that work with the care delivery tools that get information to the right caregivers at the right time,” Cerner President and Chief Executive Officer David Feinberg said in the press release. “Joining Oracle as a dedicated Industry Business Unit provides an unprecedented opportunity to accelerate our work modernizing electronic health records (EHR), improving the caregiver experience, and enabling more connected, high-quality and efficient patient care.”
Beyond the flowery language of the press release, however, the healthcare industry will wait and see if this merger can back up with words with actions.
“With Oracle's resources, infrastructure and cloud capabilities, Cerner will accelerate the pace of product and technology development to enable more connected, high-quality and efficient care.”
— Joint press release from Cerner and Oracle.
Eric Wicklund is the associate content manager and senior editor for Innovation at HealthLeaders.