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Sage Sets its Health I.T. Table


By Joseph Goedert, News Editor June 2007
"We have been liberated here, MOrale is higher than ever," he adds. "Under Emdeon, no one knew what would happen tomorrow. It's a whole new culture here."

Corbin previously served in senior positions, including CFO, within Elmwood Park, N.J.-based Emdeon Corp., which owned the physician software business for six years.

But under Emdeon, the corporation and software divisions had several name changes, and the parent company's wide portfolio hampered building brand awareness for its physician products, Corbin says. Besides practice management and electronic health records software, Emdeon also sold payer software, Web content, electronic data interchange services and porous plastic products.

"Sage is an easy name and gives us pretty good brand recognition," Corbin says. "People go to sage.com and know it's a software company. People didn't know what Emdeon was."

Further, the physician unit's business model changed several years ago from marketing through resellers to direct sales, which slowed sales as the strategy rolled out, Corbin says. Then in February 2006, the company announced the physician unit was for sale, which further suppressed opportunities for new business.

Now, despite publicly announcing only one customer sale during the first seven months of Sage's ownership, Corbin says sales have increased dramatically. "We're doing better than before outside the base." He declines to specify sales activity pending the release of financial results by corporate parent Sage Group, based in England.

Rebuilding project

Sage Healthcare has been relatively quiet since buying Emdeon Practice Services. Its first task was to build a new corporate infrastructure-the division relied on Emdeon Corp. for such functions as payroll, accounting, human resources and information technology.

That work is nearly done, Corbin says, except for the I.T. changeover. And he expects that to be complete well before a transition contract with Emdeon ends in September 2008. The company also had to fill out its management ranks, since several managers previously had multiple positions. Now, Sage Healthcare has separate development managers for the Intergy next-generation line of practice management and EHR software and the legacy lines of Medical Manager and MedWare. The company also recently hired a senior vice president of sales.

This spring, Sage started ramping up its visibility with more frequent announcements of activity and the first in a series of product enhancements. For instance, it is developing a version of Intergy's practice management software tailored to community health centers, also known as federally qualified health centers.

It also will embed within Intergy's practice management software the Sage Group's payroll and credit card processing applications. The integrated products are the first step in Sage's strategy to offer provider organizations a range of business management software.

The company later this year will integrate its general ledger and data analytics software with the practice management software. Among other benefits, the combined technology will show physicians their costs per encounter relative to their rate of reimbursement increases, Corbin says. "It's an analytic tool most doctors don't have because no one's put it together for them."

Planned enhancements to Intergy in 2008 include tools to help physicians monitor pay-for-performance reimbursement. Further, additions are coming for Medical Manager and MedWare, he adds.

While the small physician practice market has always been the company's prime target, Emdeon branched out to larger practices-and community hospitals-with the introduction of Intergy. Indeed, "a meaningful number" of hospitals use Intergy as their acute care EHR, Corbin says.

Sage Healthcare will continue to seek new audiences but won't abandon practices with three or less physicians, he contends. "This is our meat and potatoes and still will be because it is 82% of the market."

To expand market reach further, particularly among larger practices, laboratories and pharmacies, Sage will build, buy or partner with other vendors to get the right products.

The $565 million buy of Emdeon Practice Services was Sage Group's largest acquisition, but the company has been very acquisitive and will continue to be, Corbin says.

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