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Is Sam's Club a Game-Changer?
Health Data Management Magazine, May 1, 2009
Wal-Mart Inc.'s decision to sell electronic health records and practice management software through its Sam's Club stores could bring big changes for physicians and vendors, says Vinson Hudson, president of Jewson Enterprises, an Austin, Texas-based physician software consulting and research firm.
He's also a Sam's Club member and fan. "It offers products at a lower price than you can get elsewhere, even at Wal-Mart."
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This spring, Sam's Club will offer physicians package pricing on electronic health records, training and support from Westborough, Mass.-based eClinicalWorks Inc., with hardware from Dell Inc., Round Rock, Texas.
The package price for the offering, aimed at smaller group practices, will be less than $25,000 for the first physician and about $10,000 for each of up to two additional doctors. The price will be slightly more for larger practices. That price includes Web access for one year to both electronic records and practice management software that the vendor remotely hosts, says eClinicalWorks CEO Girish Kumar Navani.
The startup package price also includes desktop computers or Tablet PCs and printers from Dell, installation, e-prescribing integration, specialty-specific templates, online Web seminars, five days of on-site software training from eClinicalWorks and ongoing software support during the first year.
In subsequent years, the cost will be $4,000 to $6,500 per physician per year. The level of support for physicians buying from Sam's Club will be the same given to other clients, Navani says. Also, physicians can receive an online demonstration of the product before buying it from Sam's Clubs, just as they would before buying it from eClinicalWorks.
Navani estimates physicians will save roughly $4,000 in start-up costs by purchasing the packaged hardware, software and services through Sam's Club rather than separately. A Sam's Club spokesperson says the savings could amount to 30% or more over the long haul.
Hudson roughly estimates the deal would save about $5,000 up front. He also says other vendors are worried they will be pressured to reduce the cost of their own products. "If it starts growing and catching on, I'm betting Wal-Mart will purchase more licenses from Dell and eClinicalWorks and cut prices even further."
Hudson believes Wal-Mart will have success because it picked two well-known vendors as partners. The eClinicalWorks EHR "isn't the best in the world, but the product is good and Navani knows how to sell it and make it work," he adds. "And now he has a forum which is national. He has a large organization that knows how to sell in bulk and at low cost."
Getting Started
Sam's Club will market the records products and services to physicians through its Web site, samsclub.com, the spokesperson says. Among the company's 47 million members are about 200,000 health care providers, mainly physicians.
The electronic records initiative could be just the first of several physician-oriented promotional offerings through Sam's Club, Navani says.
The joint effort is attempting to make software installation for physicians "easier, cheaper and faster than what they're used to," he adds. Implementing the records package should take no more than 12 weeks, from contract signing to final roll-out, he says.
The project is an outgrowth of Wal-Mart's use of eClinicalWorks software on Dell computers at its in-store clinics for the past year. "We started having good traction with the company, and that led to this," Navani says.
Stimulus Details
Sam's Club planned to initiate the venture with or without the Medicare and Medicaid financial incentives in the federal economic stimulus package, the company spokesman says.
But the March 11 announcement came just four weeks after President Obama signed the legislation.
The American Recovery and Reinvestment Act of 2009 includes $17.2 billion in Medicare and Medicaid financial incentives for hospitals and doctors using qualifying electronic health records systems. Group practices can apply for either Medicare funding or Medicaid funding, not both.
"It is a good opportunity for physicians to get a reasonably good deal using the stimulus money and getting two good companies in the deal," Hudson says.
Still, physicians will need the same caution as they would any other vendor, Hudson advises. In particular, he wonders, "Is eClinicalWorks big enough to handle this if it takes off?"
The company will be ready to handle increased business, according to a spokesperson.
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