Annual Report

This historical report
of the U.S. Hospital

IT Market is brought
to you as an online
resource from the
Dorenfest Institute.
An industry Report provided by
and
 Table of Contents
2008 Hospital IT Industry Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2008 Hospital IT Operating Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Financial Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Financial Decision Support Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Human Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Revenue Cycle Management Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Next Generation Revenue Cycle Management Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Health Information Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Document Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Nursing IT Application Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Ancillary Department Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Operating Room (Surgery) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Ambulatory (Hospital Owned or Managed) IT Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Radiology PACS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Cardiology PACS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Bar Code Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Electronic Medical Record Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
The EMR Adoption ModelSM: Measuring Clinical IT Transformation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
This historical report of the U.S. Hospital IT Market is brought to you as an online resource from the Dorenfest Institute.
Managed by the HIMSS Foundation, the Dorenfest Institute provides a variety of detailed historical data, reports, and
white papers about information technology (IT) use in hospitals and integrated healthcare delivery networks at not
charge to universities, students under university license, U.S. governments (local, state and federal), and governments of
other countries that will be using the data for research purposes.
The Dorenfest Institute was formed in January 2005 to further the interest in and benefits associated with ongoing
research in health IT. This followed a generous donation of his company and its historical data assets to HIMSS
Foundation by Sheldon I. Dorenfest to further the interest in and benefits associated with ongoing research in health IT.
Sheldon I. Dorenfest is President/CEO of the Dorenfest Group in Chicago. The Dorenfest Group is a leading consultant
and source of knowledge about the healthcare information technology industry.
©2009 by the Healthcare Information and Management Systems Society.

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 A Letter from the CEOs of HIMSS Analytics and HIMSS
Dear Healthcare Executive:

Welcome to the 2009 Annual Report of the U.S. Hospital IT Market, produced jointly by the Healthcare Information and Management
Systems Society (HIMSS) and HIMSS Analytics LLC, the wholly-owned, not for profit market research arm of HIMSS.
The U.S. recession, which began in 2007 and is projected to last at least until the end of 2010, had a definite impact on IT implementation
in healthcare during 2008. IT investments were scaled back or delayed as hospitals learned that their variable rate bonds weren’t such a
good deal and investment portfolios, containing endowment moneys, took huge hits.
But the recession and the need for economic stimulus could be the tipping point for government to provide funding to improve the
information technology environments in all healthcare delivery modalities. HIMSS supports the federal investment of $19+ billion to
improve acute and ambulatory care IT environments in the next five years, and believes that it will help to transform healthcare in the
United States. But expect that the government will be focused on expanding access while also driving down costs.
This report provides the industry with comprehensive information about healthcare IT – what’s real, what’s planned, and where the
industry is headed. This year’s report represents a significant expansion over the earlier editions. Information has been gathered from
over 5,100 American hospitals on over 120 applications and technologies. We detail the market environments of the most important
healthcare IT applications, describe the state of the industry, and much more.
You can count on HIMSS Analytics and HIMSS to equip you to stay on top of these changes, and to be your most trusted and
comprehensive source of information on the healthcare IT market, the penetration of IT applications, and the progress toward
implementing those applications in today’s U.S. healthcare provider environment.
We hope you find this fifth edition of the Annual Report of the U.S. Hospital IT Market informative, compelling, and stimulating.
Best regards,
David E. Garets H. Stephen Lieber

President and CEO President and CEO
HIMSS Analytics HIMSS
Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 1

 2008 Hospital IT Industry Overview
• Analyzing the changing market created by new retail competitors.
Ask five economists and you’ll get five different answers — • Evaluating how to fund and implement the advancement of
six if one went to Harvard. —Edgar R. Fiedler clinical systems that continually improve patient safety and
An economist’s guess is liable to be as good as clinical outcomes.
anybody else’s. —Will Rogers • Determining how to engage the clinical staff in deriving
business value from the implementation of advanced EMR and
If all the economists were laid end to end, they’d never
clinical systems to justify their resource consumption.
reach a conclusion. —George Bernard Shaw
• Determining IT vendors with which to partner, in a consolidating
market, to improve the chances of success of business and clinical
In late 2008, it became all about the economy as the U.S. entered projects with an IT component.
the second year of a recession that will — with optimistic projections — • Providing the capital and operating expenses for IT amongst
last until the end of 2010 . . . and we found out that healthcare is not competing revenue generating and infrastructure demands
recession proof. The cause of the recession was a lack of regulatory and opportunities that will be needed to support ongoing IT
oversight on our capital markets that allowed Wall Street to market capabilities to achieve business and healthcare delivery needs.
securities that weren’t backed by any collateral. The implosion of the • Planning how to operate in potential new state and federal
market was felt in every hospital in the U.S. Some hospitals found programs that provide universal healthcare insurance coverage.
out that their variable rate bonds weren’t such a good deal as bond
auctions in some cases doubled their service rates. Hospital invest-
Government in the U.S. today is a senior partner in every
ment portfolios, which contain endowment moneys, also took a
business in the country. —Norman Cousins
hit as the stock market experienced wild swings and most stocks
lost significant value in a few months. The money that Congress
gave banks was not used by banks to improve the capital markets From an optimistic standpoint, the recession and the need for economic
in many cases, and hospitals began to pull back on some of their stimulus could be the tipping point for government to provide funding
major capital projects. Building projects were cancelled or scaled to improve the information technology environments in all healthcare
back. Investments in healthcare information technologies (IT) modalities. HIMSS has proposed that we could achieve remarkable
were also scaled back or delayed, as were investments in medical improvements by investing $25 billion to improve acute and ambu-
technologies. Some hospitals even cut non-clinical staff and forced latory care IT environments. This could be the right environment
pay reductions on employees. for finally getting the funding the industry needs. Optimism is high
that the Obama administration and Congress will create a viable
strategy, path, and funding for transforming our healthcare market.
Business, more than any other occupation, is a
But expect that the government will be focused on expanding
continual dealing with the future; it is a continual calculation,
access while also driving down costs.
an instinctive exercise in foresight. —Henry R. Luce
Obstacles are those frightful things you see when you

While the recession began in December of 2007, it is but one of
take your eyes off your goal. —Henry Ford
many challenges that healthcare executives will face over the next
three to five years:
• Adjusting to the Obama administration’s approach to funding, We still have key business and IT issues that continue to challenge U.S.
regulating, and reforming healthcare. hospitals year after year. The government continues to cut funding
• Unfunded government mandates related to approaching HIPAA for Medicare and Medicaid, and has not moved quickly enough to
Claims Attachment, severity adjusted DRG, and ICD-10 coding drive industry standards that are needed to foster “interoperability”
initiatives. between healthcare IT applications. Demonstrating ROI for the
• Implementing strategies to take advantage of relaxation of the EMR remains elusive, and even P4P programs have not achieved
Stark Laws to promote hospital funding and support of ambula- their desired outcomes in many cases.
tory electronic medical record (EMR) applications, balancing
risk and investments. A budget tells us what we can’t afford, but it doesn’t
• Evaluating the impact of pay for performance (P4P) on hospital keep us from buying it. —William Feather
services and finances.
• Determining how to use the Web to effectively push more services Hospital IT operating expenses as a percentage of total hospital
to consumers. operating expenses were down in 2008 from 2007. Both the median
• Evaluating how to effectively share information with other and mean metrics for IT operating expenses as a percentage of total
healthcare entities in healthcare information exchange (HIE) and hospital operating expenses decreased in 2008. This is to be
regional healthcare information organization (RHIO) initiatives expected with the impact of the market recession. We believe that
to drive efficiencies and patient-focused healthcare without the market will experience another decline in 2009 that will range
compromising competitive advantages. from 20–30 basis points for this metric. While there was a decline
2 Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics.

 2008 Hospital IT Industry Overview (con tinue d)
in the operating expense ratio in 2008, there were some market
pockets where this ratio increased over 2007. These segments Action and reaction, ebb and flow, trial and error, change — this is the
were the 101–300 and 401–500 bed-size segments, urban and rhythm of living. Out of our over-confidence, fear; out of our fear, clearer
single hospital systems, and the East South Central, Mountain, vision, fresh hope. And out of hope, progress. —Bruce Barton
Northeast, Pacific, and West South Central U.S. census regions.
As in 2007, there were not as many big IT implementation/ New healthcare delivery and service models will continue to emerge.
re-engineering projects in 2008 as there have been in previous Google, Microsoft, WalMart, Walgreens, and CVS are introducing
years. We believe that many hospitals are using fewer consulting new models to support more efficient and cost effective primary
services which lowers the IT operating expense for hospitals in healthcare delivery and improved patient services. These are large
tough economic times. It also threatens to delay the realization companies that have the market reach to drive these new models
of benefits from hospital implementations of EMRs. to success if they can effectively incorporate all of the industry
stakeholders into their business models. WalMart, Walgreens, and
The first rule of any technology used in a business is that CVS have learned that they will be successful with their in-store
automation applied to an efficient operation will magnify the efficiency. clinics only if they involve community physicians into their over-
The second is that automation applied to an inefficient operation sight and operations. Google, Microsoft, and Revolution Health will
will magnify the inefficiency. —Bill Gates be successful only if the market adopts interoperability
standards such as CCD to more effectively exchange data. The rise of
Revenue cycle management (RCM) may finally be hitting the pain the Patient Medical Home concept is also emerging as a new model
point for chief financial officers for driving upgrades into this legacy to more effectively manage a patient’s and/or their family’s care.
environment. Impending HIPAA claims attachment, severity Care delivery is definitely shifting to an ambulatory model, and
adjusted DRG, Recovery Audit Contractor processes, and hospitals have to develop strategies to transition their facilities,
ICD-10-CM coding regulations will disrupt this market. These resources, and capital to support this market transition.
changes could be particularly dramatic since many of the RCM Capitated reimbursement models are again emerging as healthcare
applications (e.g., patient billing, encoding, ADT/registration) costs spiral out of control. While the U.S. automakers struggle
are legacy applications based on monolithic architectures that will with survival, and the auto unions take responsibility for insuring
not easily accommodate the modifications necessary to address healthcare for retirees, the only viable model to ensure the best
these new demands. Vendors with effective next generation RCM use of the unions’ healthcare funds is a capitated model. The U.S.
(NGRCM) applications stand to gain significant market share government will also extend its capitated Medicare and Medicaid
over the next five years, and market leaders are protecting their models to children and other socio-economic population segments to
positions with new offerings. ensure we provide access to healthcare services to all U.S. citizens.
Integration of financial and clinical systems continues to show Hospitals that have the most sophisticated EMR and financial
progress. The HIPAA claims attachment regulations and the emerg- application environments will be best positioned to win these
ing P4P/outcomes-based reimbursement models endorsed contracts and still generate profits on their services.
by the Centers for Medicare and Medicaid Services (CMS) This is the fifth edition of the Annual Report of the U.S. Hospital
provide substantial demands for integrating the data from financial IT Market, and we hope you find it compelling, stimulating, and
and clinical applications within hospitals. The lack of interoperabil- informative.
ity standards provides the challenge for integrating the data
from these application suites, but progress is being made and The HIMSS Analytics Research Team
demonstrated by organizations such as Integrating the Healthcare Mike Davis
Enterprise (IHE). Government endorsement of the Continuity Dave Garets
of Care Document (CCD) transaction standard also provides a good John Hoyt
foundation for increasing interoperability over the next Jennifer Horowitz
three to five years. The good news is that the HIMSS Analytics Roger Park
EMR Adoption ModelSM reflects an ever-increasing adoption Aviva Zupancic
of EMR applications that is moving the industry and the country Nikita Macklin
slowly, but consistently, forward. Gina Doruff

 2008 Hospital IT Operating Expenses
Due to the recession that the U.S. entered at the end of 2007, we Examining the operating expense ratio on a U.S. regional basis
expected both the operating and capital budgets to be impacted shows that more than five of nine regions had increases in this
for hospital IT. While capital budgets will remain impacted until metric from 2007 to 2008: East South Central, Mountain,
the capital markets improve, the operating budgets in many cases New England, Pacific, and West South Central (see Table HB4).
will increase for some hospitals due to the need to support the more
An evaluation of the median IT operating expense to total hospital
sophisticated IT environments that some hospitals have implemented
operating expense ratios for hospital bed-size segments shows
over the last three years. The scrutiny of hospital IT operating
that all segments had increases from 2007 to 2008 except for the
expenses by hospital executives has been acute over the last three
501–600 bed segment (see Table HB5). The spending impact of this
years, and the current economic situation will only increase the
segment on the market is obvious since the all hospital median
focus on these expenses. But we continue to caution hospitals on
metric is down from 2007 to 2008.
cutting the IT operating budgets relative to the support needs for
increasingly sophisticated infrastructure, transaction, and applica- Ta ble HB 3
tion environments. 2006 2007 2008
Avg of IS Avg of IS Avg of IS
The mean and median metrics for average IT operating expense Total Total Total
Budget Budget Budget
to total hospital operating expense for all hospitals shows that the as % of as % of as % of
median number is lower year over year than the average for this Hospital
Expense N
Hospital
Expense N
Hospital
Expense N
metric (see Table HB1). The average IT operating expense metric is Academic 4.79% 30 5.25% 26 4.79% 25
impacted by the wide range of IT operating expenses that reflects Non-Academic 4.96% 221 4.17% 183 4.12% 242
the various stages of hospital IT project complexity year over year. General Med/Surg 4.47% 185 4.21% 164 4.14% 188
The median IT operating expense metric is more reflective of IT Others 6.25% 66 4.64% 45 4.28% 79
environments that are more “steady state” in their operations at the

Rural 6.07% 30 4.33% 15 3.21% 31
Urban 4.79% 221 4.30% 194 4.31% 236
current time. In 2008, the impact of the global economic recession IDS 7.24% 86 4.60% 98 4.43% 68
is seen by lower metrics in 2008 that what was seen in 2007. We Independent Hospital 3.74% 165 4.04% 111 4.10% 199
believe this metric will also be lower in 2009 for both the average
and median percentages. We believe the reduction in the average Ta ble HB4
metric over the last three years is reflective of the reduction in the
2006 2007 2008
Avg of IS Avg of IS Avg of IS
use of IT consulting services over that period of time. Total Total Total
Ta ble HB1 as % of as % of as % of
Hospital Hospital Hospital
% IS Total Operating Budget Region Expense N Expense N Expense N
as % of Hospital Expense 2006 2007 2008
East North Central 3.52% 52 4.78% 39 4.20% 57
Median 3.51% 3.60% 3.49%
East South Central 5.11% 21 2.92% 3 4.30% 13
Average 4.94% 4.30% 4.18%
Middle Atlantic 5.58% 38 4.36% 23 3.71% 34
Mountain 5.17% 14 5.91% 15 7.61% 15
Ta ble HB2 New England 3.46% 14 3.83% 17 4.05% 24
2006 2007 2008 Pacific 6.94% 27 3.86% 57 4.90% 26
Avg. % of Avg. % of Avg. % of South Atlantic 6.13% 36 4.05% 31 3.75% 43
IT Op. Exp./ IT Op. Exp./ IT Op. Exp./
Total Op. Total Op. Total Op. West North Central 4.71% 29 5.14% 15 3.40% 34
Bed Size Segments Exp. N Exp. N Exp. N West South Central 3.59% 20 3.06% 9 3.81% 21
0–100 beds 5.15% 56 3.75% 41 3.65% 78 State Key for Regions:
101–200 beds 5.01% 59 3.53% 49 3.83% 61 New England . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MA, ME, VT, RI, CT, NH
201–300 beds 3.72% 53 4.37% 37 4.95% 50 Middle Atlantic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NY, NJ, PA
South Atlantic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MD, DE, DC, WV, VA, NC, SC, GA, FL
301–400 beds 4.48% 37 5.04% 36 4.52% 36 East North Central . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MI, OH, IN, IL, WI
401–500 beds 6.75% 19 3.56% 19 4.39% 21 East South Central . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . KY, TN, MS, AL
501–600 beds 6.78% 10 6.61% 10 3.58% 7 West North Central . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MN, IA, MO, KS, ND, SD, NE
West South Central . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . TX, LA, AR, OK
600+ beds 5.69% 17 5.65% 17 5.05% 14 Mountain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ID, CO, WY, MT, NV, UT, AZ, NM
All 4.94% 251 4.30% 209 4.18% 267 Pacific . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . WA, CA, OR, AK, HI
The average IT operating expense, as a percentage of total hospital Ta ble HB5

operating expense in 2008, is best evaluated by various market 2006 2007 2008
Median % Median % Median %
segmentations. If we evaluate the three-year trend by bed size, we IS Total IS Total IS Total
can see that only hospitals in the 201–300 bed segment showed an Budget
as % of
Budget
as % of
Budget
as % of
increase each year (see Table HB2). The bed segments that showed Hospital Hospital Hospital
an increase from 2007 to 2008 were the 101–200, 201–300, and Bed Segments Expense N Expense N Expense N
0–100 beds 2.23% 56 2.59% 41 2.77% 78
401–500 segments, even though the total market showed a decline 101–200 beds 3.51% 59 2.97% 49 3.57% 61
in this metric from 2007 to 2008. 201–300 beds 3.42% 53 3.75% 37 4.32% 50
301–400 beds 3.86% 37 3.91% 36 4.16% 36
An evaluation of hospitals by type showed that only urban and 401–500 beds 4.82% 19 2.78% 19 3.85% 21
independent hospitals had an increase from 2007 to 2008 in the 501–600 beds 4.42% 10 5.71% 10 3.39% 7
operating expense ratio, but these increases were exceptionally 600+ beds 4.57% 17 4.34% 17 4.66% 14
small (see Table HB3). All 3.51% 251 3.60% 209 3.49% 267

 2008 Hospital IT Operating Expenses (con tinue d)
Ta ble HB6 the South Atlantic has replaced New England as a region with an
2006 2007 2008 increase in the metric from 2007 to 2008 (see Table HB7). The
Median % Median % Median % regions that demonstrated an increase in the median operating ratio
from 2007 to 2008 were: East South Central, Mountain, Pacific,
IS Total IS Total IS Total
as % of as % of
Hospital
as % of
Hospital
South Atlantic, and West South Central.
Hospital
Expense N Expense N Expense N
Market Drivers/Factors
Academic 4.55% 30 5.39% 26 3.84% 25
Non-Academic 3.37% 221 3.34% 183 3.48% 242 Hospital IT operating budgets have been and will continue to
General Med/Surg 3.42% 185 3.29% 164 3.49% 188 be impacted through 2010 by:
Others 3.94% 66 4.34% 45 3.48% 79 • Increased IT application sophistication – improvements in
Rural 1.98% 30 2.50% 15 2.85% 31 functionality for electronic medical records and revenue cycle
Urban 3.69% 221 3.61% 194 3.60% 236
management will lead other application environments.
IDS 4.13% 86 3.23% 98 3.43% 68
Independent Hospital 3.05% 165 3.66% 111 3.54% 199
• Increased security support and maintenance requirements.
• Increased database maintenance and support requirements.
Ta ble HB7 • Increased need for data research and analysis functions to
2006 2007 2008 support clinical decision support and protocols development
Median % Median % Median % and support.
IS Total IS Total IS Total
Budget Budget Budget • Increasing governmental and quality agencies reporting
as % of
Hospital
as % of
Hospital
as % of
Hospital
requirements.
Region Expense N Expense N Expense N • Increased system recovery and business continuity support
East North Central 3.07% 52 4.07% 39 3.63% 57 functions.
East South Central 3.55% 21 3.66% 3 4.21% 13
• Increased device support functions driven by supporting
Middle Atlantic 3.11% 38 3.63% 23 3.03% 34
Mountain 2.92% 14 3.75% 15 3.81% 15 multiple clinician devices (e.g., handheld devices, PDAs,
New England 3.10% 14 3.97% 17 3.57% 24 Blackberries, pen tablets).
Pacific 4.69% 27 2.74% 57 5.04% 26 • Supporting local and regional health information exchanges.
South Atlantic 4.19% 36 3.40% 31 3.48% 43 • Supporting the implementation of applications or application
upgrades that support new government regulations (HIPAA
West North Central 3.67% 29 3.83% 15 3.05% 34
West South Central 3.77% 20 2.69% 9 3.24% 21
claims attachment, severity adjusted DRGs, ICD10 CM, etc.).
When evaluating the median operating expense ratio by hospital • Supporting the expansion of IT services to clinics and ambulatory
type, the non-academic, general medical/surgical, rural, and centers under the new Stark law exemptions and anti-kickback
integrated delivery system (IDS) types showed increases from 2007 safe harbors.
to 2008 (see Table HB6). • Supporting the demand for increased electronic data interchange
(EDI) transactions (e.g., payer transactions and supply chain
The analysis by U.S. regions is similar to what we found in analyzing
transactions).
this average operating ration, but with the median ratio we find that
 Financial Management
The financial management healthcare IT application market in The majority of purchasing plans for this market in 2008 indicated
2008 is a virtually saturated market for the legacy applications that first-time purchases were predominantly for ERP systems,
of accounts payable and general ledger. Materials management but replacement purchases dominate for the legacy applications
showed a slight growth of more than two percent from 2007 to of accounts payable, and general ledger (see Table FM2). The mate-
2008; nevertheless, like accounts payable and general ledger, this rials management purchasing plans are almost evenly split between
is near market saturation. Newer generation solutions such as replacement and first-time purchases. This is due mainly to the
enterprise resource planning (ERP) demonstrated a very slight first-time purchasing activities in the under-100 bed
growth in 2008. The ERP applications typically replace accounts segment, which accounts for all of the critical access hospitals.
payable, general ledger and materials management solutions along
An evaluation of hospital type market segments for financial
with human resource applications, but the requirement of process
management applications in 2008 demonstrates the following:
re-engineering to effectively implement ERP applications has
• Accounts payable is a saturated market for the academic/teaching
slowed the rate of adoption in the market (see Table FM1).
segment and all other segments are becoming saturated (see
Ta ble F M1 | Percentages Indicate Live and Operational, Contracted, Table FM3). Rural, other non-medical/surgical and single hospital
and Installations in Process system segments had the highest growth in 2008, at approxi-
N=3,975 2006 2007 2008
mately three percent.
Accounts Payable 86.31% 98.34% 99.67%
Enterprise Resource Planning 15.60% 17.66% 17.84%
• ERP had very slight growth from 2007 to 2008 across the different
General Ledger 86.21% 98.16% 99.60% segments, with declines in growth among other non-medical/sur-
Materials Management 82.94% 93.96% 96.18% gical hospitals, rural, and multi-hospital systems (see Table FM4).

 Financial Management (con tinued)
Ta ble F M2 | 2008
# of Hospitals % of Hospitals # of Hospitals Planning % of Hospitals Planning
With Installed With Installed To Purchase Software To Purchase Software N = Total Number of
Software – Replacing Software – Replacing For The First Time For The First Time Hospitals Planning
Accounts Payable 18 100.00% 0 0.00% 18
Enterprise Resource Planning 0 0.00% 8 100.00% 8
Materials Management 19 100.00% 0 00.0% 19
RFID – Supply Tracking 13 52.00% 12 48.00% 25
Replacing = Statuses of Live & Operational, Contracted/Not Yet Installed and Installation In Process
First time = Status of Not Automated
Ta ble F M3 | Accounts Payable

2006 2007 2008
Segment Total Segment Total Segment Total
Count Percent Count Count Percent Count Count Percent Count
Academic/Teaching 254 99.22% 256 255 99.61% 256 256 100.00% 256
Academic
Not Academic 3,177 85.43% 3,719 3,654 98.25% 3,719 3,706 99.65% 3,719
Med/Surg 2,236 94.03% 2,378 2,356 99.07% 2,378 2,373 99.79% 2,378
Med Surg
Other 1,195 74.83% 1,597 1,553 97.24% 1,597 1,589 99.50% 1,597
Rural 624 65.55% 952 917 96.32% 952 945 99.26% 952
Urban
Urban 2,807 92.85% 3,023 2,992 98.97% 3,023 3,017 99.80% 3,023
Single/Multi Multi-Hospital System 2,182 97.45% 2,239 2,227 99.46% 2,239 2,236 99.87% 2,239
Hospital Single Hospital System 1,249 71.95% 1,736 1,682 96.89% 1,736 1,726 99.42% 1,736
All 3,431 86.31% 3,975 3,909 98.34% 3,975 3,962 99.67% 3,975
Ta ble F M4 | Enterprise Resource Planning

2006 2007 2008
Academic
Not Academic 552 14.84% 3,719 620 16.67% 3,719 626 16.83% 3,719
Med/Surg 389 16.36% 2,378 440 18.50% 2,378 448 18.84% 2,378
Med Surg
Other 231 14.46% 1,597 262 16.41% 1,597 261 16.34% 1,597
Rural 42 4.41% 952 48 5.04% 952 46 4.83% 952
Urban
Urban 578 19.12% 3,023 654 21.63% 3,023 663 21.93% 3,023
Single/Multi Multi-Hospital System 513 22.91% 2,239 580 25.90% 2,239 570 25.46% 2,239
Hospital Single Hospital System 107 6.16% 1,736 122 7.03% 1,736 139 8.01% 1,736
All 620 15.60% 3,975 702 17.66% 3,975 709 17.84% 3,975
Ta ble F M5 | General Ledger

2006 2007 2008
Academic
Not Academic 3,172 85.29% 3,719 3,646 98.04% 3,719 3,703 99.57% 3,719
Med/Surg 2,231 93.82% 2,378 2,354 98.99% 2,378 2,373 99.79% 2,378
Med Surg
Other 1,196 74.89% 1,597 1,548 96.93% 1,597 1,586 99.31% 1,597
Rural 623 65.44% 952 913 95.90% 952 942 98.95% 952
Urban
Urban 2,804 92.76% 3,023 2,989 98.88% 3,023 3,017 99.80% 3,023
All 3,427 86.21% 3,975 3,902 98.16% 3,975 3,959 99.60% 3,975
Ta ble F M6 | Materials Management

2006 2007 2008
Academic
Not Academic 3,045 81.88% 3,719 3,479 93.55% 3,719 3,567 95.91% 3,719
Med/Surg 2,217 93.23% 2,378 2,340 98.40% 2,378 2,353 98.95% 2,378
Med Surg
Other 1,080 67.63% 1,597 1,395 87.35% 1,597 1,470 92.05% 1,597
Rural 544 57.14% 952 792 83.19% 952 846 88.87% 952
Urban
Urban 2,753 91.07% 3,023 2,943 97.35% 3,023 2,977 98.48% 3,023
All 3,297 82.94% 3,975 3,735 93.96% 3,975 3,823 96.18% 3,975

• General ledger is a saturated market for the academic/teaching A review of the financial management market in 2008 by bed-
segment and all other segments are approaching saturation. The size segments provides additional insight into the saturation of
single and other hospitals segments demonstrated the highest the market (see Tables FM7–FM13):
growth in 2008 (see Table FM5). • Accounts payable has reached market saturation for all
• Materials management has reached market saturation for the aca- hospitals over 100 beds. The highest growth in 2008 was in the
demic/teaching hospitals and multi-hospital systems, and is 0–100 bed segment, which is very close to complete saturation.
approaching saturation for the other segments (see Table FM6). • Enterprise resource planning adoption demonstrated a slight
The highest growth was in other non-medical/surgical, rural decline for all hospitals of 200 beds or less, but this is not
and single hospital segments. statistically significant. The highest growth for these applica-
tions was in the 301–500 bed segments.
Ta ble F M7
0–100 Beds 2006 2007 2008
• General ledger is saturated for all bed segments over 100 beds.
% of 1,931 hospitals The 0–100 bed segment experienced the highest growth in
Accounts Payable 1,400 72.50% 1,870 96.84% 1,918 99.33% 2008 of almost three percent and is also near saturation.
Enterprise Resource Planning 199 10.31% 214 11.08% 208 10.77% • Materials management is saturated in all hospitals over 400 beds
General Ledger 1,397 72.35% 1,863 96.48% 1,915 99.17%
and is close to saturation for the remaining bed segments. The
RFID – Supply Tracking 1,283 66.44% 1,701 88.09% 1,787 92.54%
highest growth was in the 0–100 bed segment.
Ta ble F M8 A review of temporal contract signing for financial management
101–200 Beds 2006 2007 2008
applications in 2008 depicts a market with the majority of con-
% of 803 hospitals
Accounts Payable 793 98.75% 800 99.63% 803 100.00% tract activity taking place in the 1995–1999 time frame, with
Enterprise Resource Planning 133 16.56% 144 17.93% 142 17.68% the exception of materials management which saw the most
General Ledger 793 98.75% 799 99.50% 803 100.00% activity in the 2000–2004 time frame (see Tables FM14–FM15).
RFID – Supply Tracking 787 98.01% 795 99.00% 797 99.25% Applications purchased in the 1995–1999 time frame may be
nearing the end of their useful lives relative to their ability to
Ta ble F M9
201–300 Beds 2006 2007 2008
support new electronic data interchange transactions for supply
% of 494 hospitals chain management or electronic funds transfer processes. We
Accounts Payable 492 99.60% 493 99.80% 494 100.00% expect that replacement selling opportunities for this market
Enterprise Resource Planning 106 21.46% 125 25.30% 128 25.91% will continue to rise through 2011.
General Ledger 491 99.39% 493 99.80% 494 100.00%
RFID – Supply Tracking 485 98.18% 493 99.80% 493 99.80% Ta ble F M14
# for Contract
Ta ble F M10 2008 Range Total % of Total
301–400 Beds 2006 2007 2008 Accounts Payable
% of 308 hospitals Prior to 1990 182 2,972 6.12%
Accounts Payable 307 99.68% 307 99.68% 308 100.00% 1990 to 1994 386 2,972 12.99%
Enterprise Resource Planning 72 23.38% 84 27.27% 91 29.55% 1995 to 1999 1,064 2,972 35.80%
General Ledger 308 100.00% 308 100.00% 308 100.00% 2000 to 2004 889 2,972 29.91%
RFID – Supply Tracking 305 99.03% 307 99.68% 307 99.68% 2005 to 2008 451 2,972 15.17%
Total 2,972 2,972 100.00%
Ta ble F M11 Enterprise Resource Planning
Prior to 1990 0 424 0.00%
401–500 Beds 2006 2007 2008
1990 to 1994 3 424 0.71%
% of 179 hospitals
1995 to 1999 195 424 45.99%
Accounts Payable 179 100.00% 179 100.00% 179 100.00%
2000 to 2004 187 424 44.10%
Enterprise Resource Planning 33 18.44% 46 25.70% 50 27.93%
2005 to 2008 39 424 9.20%
General Ledger 178 99.44% 179 100.00% 179 100.00%
Total 424 424 100.00%
RFID – Supply Tracking 178 99.44% 179 100.00% 179 100.00%
Ta ble F M12 Ta ble F M15

# for Contract
501–600 Beds 2006 2007 2008 2008 Range Total % of Total
% of 117 hospitals General Ledger
Accounts Payable 117 100.00% 117 100.00% 117 100.00% Prior to 1990 169 2,964 5.70%
Enterprise Resource Planning 38 32.48% 44 37.61% 45 38.46% 1990 to 1994 378 2,964 12.75%
General Ledger 117 100.00% 117 100.00% 117 100.00% 1995 to 1999 1,059 2,964 35.73%
2005 to 2008 434 2,964 14.64%
Ta ble F M13 Total 2,964 2,964 100.00%
600+ Beds 2006 2007 2008 Materials Management
Accounts Payable 143 100.00% 143 100.00% 143 100.00% 1990 to 1994 303 2,771 10.93%
Enterprise Resource Planning 39 27.27% 45 31.47% 45 31.47% 1995 to 1999 871 2,771 31.43%
General Ledger 143 100.00% 143 100.00% 143 100.00% 2000 to 2004 1,023 2,771 36.92%
Total 2,771 2,771 100.00%

Market Drivers/Factors • The struggle to effectively implement ERP systems with process
The financial management IT application market has been and re-engineering that delivers the expected return on investment for
will continue to be impacted through 2010 by: these applications.
• Lack of access to capital for replacing older legacy applications. • Accurate and flexible accounting needs for mergers, acquisitions,
• Replacement of legacy general ledger, accounts payable, and and divestitures among hospital systems.
materials management application systems by ERP systems, • Improved accounting capabilities to compete in a market where
particularly in hospitals over 400 beds. pricing is becoming transparent, and reimbursements will be
• The need to improve supply chain management processes and based on outcomes.
lower supply costs.
 Financial Decision Support Environment

The financial decision support environment includes the budgeting, modeling (solutions for modeling revenues and contracts to mini-
business intelligence (for real time evaluation and tracking of key mize financial risk) applications. In 2008, slight market penetration
operational metrics), cost accounting, data warehousing – financial increases over 2007 were observed for all financial decision
(a database component for capturing and providing analysis of key support applications (see Table FDS1). Moderate market growth
financial metrics), executive information system (the presentation of of approximately three percent was demonstrated by budgeting,
key performance metrics and trends to executives), and financial business intelligence, and data warehousing – financial solutions
and financial modeling.
Ta ble F ds1 | Percentages for Live and Operational, Contracted, and
Installation in Process As in 2007, the more mature financial decision support applications
N=3,975 2006 2007 2008 such as budgeting and cost accounting purchases generally involved
Budgeting 72.70% 78.49% 82.16% replacing legacy applications. All other financial decision support
Business Intelligence 17.89% 24.00% 28.93%
application purchases in 2008 were more frequently first-time buy-
Cost Accounting 62.64% 66.59% 68.73%
Data Warehousing – Financial 21.51% 26.29% 30.47%
ing decisions versus replacement decisions. (see Table FDS2) The
Executive Information Systems 49.94% 55.04% 57.84% sole exception is business intelligence, for which most purchases
Finacial Modeling 19.72% 25.48% 28.43% were first-time purchases.
Ta ble F DS 2 | 2008
Budgeting 18 94.74% 1 5.26% 19
Business Intelligence 3 14.29% 18 85.71% 21
Cost Accounting 17 85.00% 3 15.00% 20
Data Warehousing – Financial 2 33.33% 4 66.67% 6
Executive Information Systems 5 35.71% 9 64.29% 14
Financial Modeling 1 14.29% 6 85.71% 7
Evaluation of hospital type market segments for the financial • Data warehousing – financial: academic medical centers, multi-
decision support applications in 2008 showed the highest growth hospital systems, medical/surgical hospitals and urban hospitals
for the following: (see Table FDS6).
• Budgeting: other non-medical/surgical hospitals, rural hospitals, • Executive information systems: rural and single hospital systems
single hospitals and not academic hospitals (see Table FDS3). show a growth of approximately four percent (see Table FDS7).
• Business intelligence; shows good growth across all areas, with • Financial modeling: academic medical centers, rural hospitals
the highest growth among both academic medical centers and (see Table FDS8).
not academic facilities, medical/surgical hospitals, multi-hospital
The only application approaching market saturation in 2008
systems and urban hospitals (see Table FDS4).
hospital segments is budgeting in the academic/teaching segment
• Cost accounting: rural hospitals, non-medical/surgical hospitals
and the multi-hospital segments.
and single hospitals all show at least a three percent growth in
the past year (see Table FDS5).

 Financial Decision Support Environment (con tinue d)
Ta ble F DS 3 | Budgeting
2006 2007 2008
Academic
Not Academic 2,662 71.58% 3,719 2,882 77.49% 3,719 3,025 81.34% 3,719
Med/Surg 1,952 82.09% 2,378 2,041 85.83% 2,378 2,095 88.10% 2,378
Med Surg
Other 938 58.74% 1,597 1,079 67.56% 1,597 1,171 73.32% 1,597
Rural 448 47.06% 952 555 58.30% 952 637 66.91% 952
Urban
Urban 2,442 80.78% 3,023 2,565 84.85% 3,023 2,629 86.97% 3,023
Hospital Single Hospital System 939 54.09% 1,736 1,111 64.00% 1,736 1,225 70.56% 1,736
All 2,890 72.70% 3,975 3,120 78.49% 3,975 3,266 82.16% 3,975
Ta ble F DS 4 | Business Intelligence

2006 2007 2008
Academic
Not Academic 652 17.53% 3,719 874 23.50% 3,719 1,053 28.31% 3,719
Med/Surg 468 19.68% 2,378 636 26.75% 2,378 780 32.80% 2,378
Med Surg
Other 243 15.22% 1,597 318 19.91% 1,597 370 23.17% 1,597
Rural 51 5.36% 952 86 9.03% 952 115 12.08% 952
Urban
Urban 660 21.83% 3,023 868 28.71% 3,023 1,035 34.24% 3,023
All 711 17.89% 3,975 954 24.00% 3,975 1,150 28.93% 3,975
Ta ble F DS 5 | Cost Accounting

2006 2007 2008
Academic
Not Academic 2,268 60.98% 3,719 2,423 65.15% 3,719 2,506 67.38% 3,719
Med/Surg 1,727 72.62% 2,378 1,795 75.48% 2,378 1,825 76.75% 2,378
Med Surg
Other 763 47.78% 1,597 852 53.35% 1,597 907 56.79% 1,597
Rural 351 36.87% 952 422 44.33% 952 466 48.95% 952
Urban
Urban 2,139 70.76% 3,023 2,225 73.60% 3,023 2,266 74.96% 3,023
Hospital Single Hospital System 844 48.62% 1,736 963 55.47% 1,736 1,020 58.76% 1,736
All 2,490 62.64% 3,975 2,647 66.59% 3,975 2,732 68.73% 3,975
Ta ble F DS6 | Data Warehousing – Financial

2006 2007 2008
Academic
Not Academic 771 20.73% 3,719 943 25.36% 3,719 1,095 29.44% 3,719
Med/Surg 559 23.51% 2,378 680 28.60% 2,378 795 33.43% 2,378
Med Surg
Other 296 18.53% 1,597 365 22.86% 1,597 416 26.05% 1,597
Rural 70 7.35% 952 106 11.13% 952 133 13.97% 952
Urban
Urban 785 25.97% 3,023 939 31.06% 3,023 1,078 35.66% 3,023
All 855 21.51% 3,975 1,045 26.29% 3,975 1,211 30.47% 3,975
Ta ble F DS7 | Executive Information Systems

2006 2007 2008
Academic
Not Academic 1,828 49.15% 3,719 2,024 54.42% 3,719 2,129 57.25% 3,719
Med/Surg 1,388 58.37% 2,378 1,466 61.65% 2,378 1,521 63.96% 2,378
Med Surg
Other 597 37.38% 1,597 722 45.21% 1,597 778 48.72% 1,597
Rural 238 25.00% 952 343 36.03% 952 383 40.23% 952
Urban
Urban 1,747 57.79% 3,023 1,845 61.03% 3,023 1,916 63.38% 3,023
All 1,985 49.94% 3,975 2,188 55.04% 3,975 2,299 57.84% 3,975

Ta ble F DS 8 | Financial Modeling
2006 2007 2008
Academic
Not Academic 720 19.36% 3,719 925 24.87% 3,719 1,032 27.75% 3,719
Med/Surg 504 21.19% 2,378 650 27.33% 2,378 714 30.03% 2,378
Med Surg
Other 280 17.53% 1,597 363 22.73% 1,597 416 26.05% 1,597
Rural 59 6.20% 952 95 9.98% 952 132 13.87% 952
Urban
Urban 725 23.98% 3,023 918 30.37% 3,023 998 33.01% 3,023
All 784 19.72% 3,975 1,013 25.48% 3,975 1,130 28.43% 3,975
An analysis of the financial decision support market by bed-size Ta ble F ds12

segment in 2008 reflects the following highest growth segments 301–400 Beds 2006 2007 2008
by application (see Tables FDS9–FDS15): % of 308 hospitals
• Budgeting: growth of more than six percent among hospitals Budgeting 275 89.29% 280 90.91% 284 92.21%
with 0 to 100 beds.

Business Intelligence 79 25.65% 107 34.74% 121 39.29%
Cost Accounting 260 84.42% 258 83.77% 262 85.06%
• Business intelligence: all segments except the greater than Data Warehousing – Financial 102 33.12% 117 37.99% 128 41.56%
600 bed segment. Executive Information Systems 194 62.99% 200 64.94% 203 65.91%
• Cost accounting: 0–100 beds showed moderate growth of Financial Modeling 86 27.92% 110 35.71% 124 40.26%
almost four percent in 2008 while the other bed segments
Ta ble F ds13
showed little growth. There was a decrease among hospitals
401–500 Beds 2006 2007 2008
with 600 or more beds. % of 179 hospitals
• Data warehousing – financial: growth of at least five percent Budgeting 161 89.94% 165 92.18% 167 93.30%
among hospitals with 101–300, beds 401–500 beds, and greater Business Intelligence 50 27.93% 56 31.28% 72 40.22%
than 600 beds. Cost Accounting 153 85.47% 155 86.59% 155 86.59%
• Executive information systems: growth of approximately four

Data Warehousing – Financial 65 36.31% 78 43.58% 87 48.60%
Executive Information Systems 113 63.13% 113 63.13% 119 66.48%
percent among hospitals with 0–100 beds. Financial Modeling 49 27.37% 64 35.75% 74 41.34%
• Financial modeling: growth of at least four percent among
hospitals with 301–600 beds. Ta ble F ds14
501–600 Beds 2006 2007 2008
Ta ble F DS9 % of 117 hospitals
0–100 Beds 2006 2007 2008 Budgeting 110 94.02% 112 95.73% 112 95.73%
% of 1,931 hospitals Business Intelligence 28 23.93% 43 36.75% 49 41.88%
Budgeting 1,115 57.74% 1,298 67.22% 1,420 73.54% Cost Accounting 98 83.76% 101 86.32% 102 87.18%
Business Intelligence 232 12.01% 318 16.47% 396 20.51% Data Warehousing – Financial 40 34.19% 47 40.17% 50 42.74%
Cost Accounting 871 45.11% 1,003 51.94% 1,078 55.83% Executive Information Systems 71 60.68% 76 64.96% 76 64.96%
Data Warehousing – Financial 286 14.81% 365 18.90% 427 22.11% Financial Modeling 34 29.06% 43 36.75% 47 40.17%
Financial Modeling 257 13.31% 339 17.56% 399 20.66% Ta ble F ds15
600+ Beds 2006 2007 2008
Ta ble F DS10 % of 143 hospitals
101–200 Beds 2006 2007 2008 Budgeting 127 88.81% 134 93.71% 134 93.71%
% of 803 hospitals Business Intelligence 35 24.48% 45 31.47% 50 34.97%
Budgeting 674 83.94% 697 86.80% 706 87.92% Cost Accounting 131 91.61% 132 92.31% 131 91.61%
Business Intelligence 167 20.80% 225 28.02% 270 33.62% Data Warehousing – Financial 53 37.06% 62 43.36% 70 48.95%
Cost Accounting 585 72.85% 595 74.10% 599 74.60% Executive Information Systems 97 67.83% 100 69.93% 104 72.73%
Data Warehousing – Financial 187 23.29% 228 28.39% 276 34.37% Financial Modeling 44 30.77% 58 40.56% 60 41.96%
Financial Modeling 185 23.04% 235 29.27% 246 30.64% An evaluation of when hospitals signed contracts for financial
decision support applications shows that most of the applications
Ta ble F DS11
have been acquired after 2000 with the exception of cost
201–300 Beds 2006 2007 2008
% of 494 hospitals
accounting and executive information systems, when buying
Budgeting 428 86.64% 434 87.85% 443 89.68% was strong between 1995 and 1999 (see Tables FDS16–FDS18). We
Business Intelligence 120 24.29% 160 32.39% 192 38.87% expect this trend to continue through 2010 due to the increased adop-
Cost Accounting 392 79.35% 403 81.58% 405 81.98% tion of the newer financial decision support applications
Data Warehousing – Financial 122 24.70% 148 29.96% 173 35.02%
(e.g., business intelligence, data warehousing – financial, and
Financial Modeling 129 26.11% 164 33.20% 180 36.44%
financial modeling), and the replacement of the more mature

applications (e.g., budgeting, cost accounting, and executive Ta ble F ds18
information systems). We believe that hospitals will have an acute # for Contract
need for several of these applications as the economy becomes 2008 Range Total % of Total
Executive Information Systems
increasingly difficult through 2010. Prior to 1990 70 1,492 4.69%
Ta ble F ds16 1990 to 1994 179 1,492 12.00%
1995 to 1999 532 1,492 35.66%
# for Contract
2008 Range Total % of Total 2000 to 2004 446 1,492 29.89%
Budgeting 2005 to 2008 265 1,492 17.76%
Prior to 1990 101 2,181 4.63% Total 1,492 1,492 100.00%
1990 to 1994 290 2,181 13.30% Financial Modeling
1995 to 1999 601 2,181 27.56% Prior to 1990 6 507 1.18%
2000 to 2004 778 2,181 35.67% 1990 to 1994 107 507 21.10%
2005 to 2008 411 2,181 18.84% 1995 to 1999 107 507 21.10%
Total 2,181 2,181 100.00% 2000 to 2004 178 507 35.11%
Business Intelligence 2005 to 2008 109 507 21.50%
Prior to 1990 6 478 1.26% Total 507 507 100.00%
1990 to 1994 19 478 3.97%
1995 to 1999 146 478 30.54% Market Drivers/Factors
2000 to 2004 187 478 39.12% The financial decision support IT application market has
2005 to 2008 120 478 25.10% been (and will continue to be) impacted through 2010 by:
Total 478 478 100.00%
• A tough economy with tight capital markets.
Ta ble F ds17 • Pay-for-performance reimbursement models from private
# for Contract insurers and the government.
2008 Range Total % of Total • Continued focus on quality outcomes measures.
• Continued decrease in government reimbursements for
Cost Accounting
Prior to 1990 103 1,913 5.38%
1990 to 1994 319 1,913 16.68% Medicare and Medicaid patients.
1995 to 1999 602 1,913 31.47% • Continued movement of patient treatment services from
2000 to 2004 564 1,913 29.48% the acute care environment to ambulatory settings.
2005 to 2008 325 1,913 16.99% • Adoption of severity adjusted DRGs and ICD-10-CM
Total 1,913 1,913 100.00%
and ICD-10-PCS coding.
• Increased market competition.
Data Warehousing – Financial
Prior to 1990 6 576 1.04%
1990 to 1994 45 576 7.81% • Hospital acquisition/divestiture and merger activities.
1995 to 1999 110 576 19.10% • Hospital evaluation of services for viability, profitability,
2000 to 2004 280 576 48.61% and divestiture.
2005 to 2008 135 576 23.44% • Increased competitive environment from physicians for
Total 576 576 100.00%
outpatient services.
 Human Resources
The Human Resources Department IT environment in 2008 reached product maturity and most hospitals have the majority
continued to demonstrate very limited or no growth and is nearing of these applications installed.
market saturation for all applications (see Table HR1). This is to
Human Resources Department IT applications support key
be expected since many of the human resource applications have
staff management operations and are considered mission critical
Ta ble hr1 | Percentage of Applications with a Status of Installed, applications in today’s healthcare environment where staffing short-
Contracted or Installation in Process ages exist for many clinical professionals. These applications
N=3,975 2006 2007 2008 become even more critical in economic downturns as hospitals
need to be able to accurately access their skill levels and staffing
Benefits Administration 79.45% 84.18% 86.44%
Payroll 85.79% 96.43% 98.29%
Personnel Administration 79.85% 83.90% 85.71% requirements, payroll expenses, and impact of benefits overhead
Time & Attendance 76.45% 84.98% 89.33% to its operations.
Ta ble hr 2 | 2008
Benefits Administration 8 88.89% 1 11.11% 9
Payroll 15 100.00% 0 0.00% 15
Personnel Administration 9 75.00% 3 25.00% 12
Time & Attendance 5 29.41% 12 70.59% 17

 Human Resources (con tinued)
Due to the saturation of this market for key applications, the vast Analyzing this market using segments for multi/single hospitals,
majority of 2008 planned purchases were replacement sales versus urban/rural hospitals, academic/not academic hospitals, and medical
new sales to hospitals that have not automated the human resources surgical/other hospitals shows little change year over year for
environment, with the exception of time and attendance applica- implementations of benefits administration, payroll, personnel man-
tions (see Table HR2). agement, and time and attendance applications for most segments
(see Table HR3, Table HR4, Table HR5, and Table HR6). The highest
The time and attendance application market in 2008 represented
growth human resource application segments from 2007 to 2008
the one human resources market segment where first-time buyers
were payroll for the rural segment, personnel administration for the
nearly tripled replacement buyers. The majority of first-time buyers
rural segment, and time and attendance for the other hospital and
will be in the critical access hospital market.
single hospital segments. Overall, time and attendance showed the
most activity year over year for all human resource applications.
Ta ble HR3 | Benefits Administration
2006 2007 2008
Academic
Not Academic 2,908 78.19% 3,719 3,096 83.25% 3,719 3,185 85.64% 3,719
Med/Surg 2,160 90.83% 2,378 2,217 93.23% 2,378 2,244 94.37% 2,378
Med Surg
Other 998 62.49% 1,597 1,129 70.70% 1,597 1,192 74.64% 1,597
Rural 477 50.11% 952 583 61.24% 952 637 66.91% 952
Urban
Urban 2,681 88.69% 3,023 2,763 91.40% 3,023 2,799 92.59% 3,023
All 3,158 79.45% 3,975 3,346 84.18% 3,975 3,436 86.44% 3,975
Ta ble HR4 | Payroll

2006 2007 2008
Academic
Not Academic 3,157 84.89% 3,719 3,579 96.24% 3,719 2,653 71.34% 3,719
Med/Surg 2,228 93.69% 2,378 2,329 97.94% 2,378 2,356 99.07% 2,378
Med Surg
Other 1,182 74.01% 1,597 1,504 94.18% 1,597 1,551 97.12% 1,597
Rural 614 64.50% 952 866 90.97% 952 914 96.01% 952
Urban
Urban 2,796 92.49% 3,023 2,967 98.15% 3,023 2,993 99.01% 3,023
All 3,410 85.79% 3,975 3,833 96.43% 3,975 3,907 98.29% 3,975
Ta ble HR5 | Personnel Administration

2006 2007 2008
Academic
Not Academic 2,924 78.62% 3,719 3,082 82.87% 3,719 3,154 84.81% 3,719
Med/Surg 2,172 91.34% 2,378 2,229 93.73% 2,378 2,247 94.49% 2,378
Med Surg
Other 1,002 62.74% 1,597 1,106 69.25% 1,597 1,160 72.64% 1,597
Rural 479 50.32% 952 564 59.24% 952 613 64.39% 952
Urban
Urban 2,695 89.15% 3,023 2,271 75.12% 3,023 2,794 92.42% 3,023
All 3,174 79.85% 3,975 3,335 83.90% 3,975 3,407 85.71% 3,975
Ta ble HR6 | Time & Attendance

2006 2007 2008
Academic
Not Academic 2,805 75.42% 3,719 3,139 84.40% 3,719 3,307 88.92% 3,719
Med/Surg 2,058 86.54% 2,378 2,170 91.25% 2,378 2,239 94.15% 2,378
Med Surg
Other 981 61.43% 1,597 1,208 75.64% 1,597 1,312 82.15% 1,597
Rural 478 50.21% 952 658 69.12% 952 783 82.25% 952
Urban
Urban 2,561 84.72% 3,023 2,720 89.98% 3,023 2,813 93.05% 3,023
All 3,039 76.45% 3,975 3,378 84.98% 3,975 3,551 89.33% 3,975

 Human Resources (con tinued)
When evaluating the market by bed size segments, again we find The analysis of the dates human resource department application
no substantial changes in application implementations for human contracts were signed provides some indication for when segments
resource applications from 2007 to 2008 (see Table HR7–HR13). of the market may be looking to replace their applications due to
The majority of activity in this market was demonstrated in the issues with functional or technological obsolescence (Table HR14
0–100 bed market segment during this time frame for all human and HR15). Approximately 50 percent of the all human resource
resource applications. applications will be ten years or older in 2009, but the current eco-
nomic recession, and the priority on revenue cycle management and
Ta ble hr7
electronic medical record implementations will most likely have
0–100 Beds 2006 2007 2008
% of 1,931 hospitals
hospitals holding on to their current applications in this environ-
Benefits Administration 1,181 61.16% 1,365 70.69% 1,455 75.35% ment for as long as it is operationally feasible.
Payroll 1,386 71.78% 1,801 93.27% 1,873 97.00%
Ta ble hr14
Personnel Administration 1,182 61.21% 1,336 69.19% 1,407 72.86%
# for Contract
Time & Attendance 1,171 60.64% 1,471 76.18% 1,602 82.96% 2008 Range Total % of Total
Benefits Administration
Ta ble hr8 Prior to 1990 137 2,538 5.40%
101–200 Beds 2006 2007 2008 1990 to 1994 315 2,538 12.41%
% of 803 hospitals 1995 to 1999 931 2,538 36.68%
Benefits Administration 767 95.52% 768 95.64% 765 95.27% 2000 to 2004 804 2,538 31.68%
Payroll 792 98.63% 797 99.25% 797 99.25% 2005 to 2008 351 2,538 13.83%
Personnel Administration 772 96.14% 772 96.14% 771 96.01% Total 2,538 2,538 100.00%
Time & Attendance 720 89.66% 737 91.78% 759 94.52% Payroll
Prior to 1990 165 2,840 5.81%
Ta ble hr9 1990 to 1994 357 2,840 12.57%
201–300 Beds 2006 2007 2008 1995 to 1999 1,035 2,840 36.44%
% of 494 hospitals 2000 to 2004 866 2,840 30.49%
Payroll 489 98.99% 489 98.99% 490 99.19% Total 2,840 2,840 100.00%
Personnel Administration 486 98.38% 486 98.38% 485 98.18%
Time & Attendance 450 91.09% 457 92.51% 468 94.74% Ta ble hr15
# for Contract
Ta ble hr10 2008 Range Total % of Total
301–400 Beds 2006 2007 2008 Personnel Administration
Payroll 308 100.00% 308 100.00% 308 100.00% 1995 to 1999 944 2,560 36.88%
Personnel Administration 302 98.05% 305 99.03% 305 99.03% 2000 to 2004 812 2,560 31.72%
Time & Attendance 284 92.21% 292 94.81% 294 95.45% 2005 to 2008 345 2,560 13.48%
Total 2,560 2,560 100.00%
Ta ble hr11 Time & Attendance
401–500 Beds 2006 2007 2008 Prior to 1990 57 2,099 2.72%
1990 to 1994 171 2,099 8.15%
% of 179 hospitals
1995 to 1999 782 2,099 37.26%
Benefits Administration 176 98.32% 176 98.32% 177 98.88%
2000 to 2004 801 2,099 38.16%
Payroll 178 99.44% 178 99.44% 179 100.00%
2005 to 2008 288 2,099 13.72%
Time & Attendance 171 95.53% 172 96.09% 175 97.77% Total 2,099 2,099 100.00%
Ta ble hr12
501–600 Beds 2006 2007 2008 The Human Resources Department IT application market has
% of 117 hospitals been and will continue to be impacted through 2011 by:
Benefits Administration 114 97.44% 114 97.44% 116 99.15% • A down economy which will drive most hospitals to extend
Payroll 116 99.15% 117 100.00% 117 100.00% the useful life of these applications for as long as possible.
• Acquisitions and mergers of healthcare IT vendors; the current
Time & Attendance 114 97.44% 114 97.44% 116 99.15%
economy will drive this activity.
Ta ble hr13 • Outsourcing services for the human resources application
600+ Beds 2006 2007 2008 suite that require very little capital outlays.
% of 143 hospitals • Application solutions provider (ASP) products.
Benefits Administration 138 96.50% 140 97.90% 140 97.90% • Intense competition between ERP system vendors
Payroll 141 98.60% 143 100.00% 143 100.00%
(e.g., Lawson, Oracle, SAP).
Time & Attendance 129 90.21% 135 94.41% 137 95.80%
• Potential government regulations (e.g., nurse staffing ratios,
healthcare savings accounts).
• Continued shortages of clinicians, especially pharmacists
and nurses.
• Innovative benefits packages crafted to attract and retain
skilled clinicians.

 Revenue Cycle Management Environment
The revenue cycle management (RCM) market for 2008 shows near Ta ble RCM1 | Percentages Represent Live and Operational,
market saturation for legacy systems applications (ADT/ Contracted, and Installations in Process
registration and patient billing). The RCM applications that indicate N=3,975 2006 2007 2008
growing market penetration of more than four percent from 2007 to ADT/Registration 86.42% 97.79% 99.17%
Bed Management NA NA 15.67%
2008 include electronic data interchange – clearing house vendor Contract Management 56.30% 61.76% 63.65%
(EDI), eligibility, and patient scheduling. The contract Credit/Collections 80.05% 86.64% 89.16%
management application, credit and collections, and enterprise mas- EDI – Clearinghouse Vendor 36.98% 57.03% 62.97%
ter person index (EMPI) markets show slower growth year Eligibility 41.53% 53.01% 57.71%
over year (see Table RCM1).

Enterprise Master Patient Index (EMPI) 29.48% 37.23% 40.65%
Patient Billing 85.91% 97.81% 98.94%
Patient Scheduling 64.65% 80.08% 89.53%
Ta ble rcm2 | 2008

ADT/Registration 25 96.15% 1 3.85% 26
Bed Management 2 11.11% 16 88.89% 18
Contract Management 16 64.00% 9 36.00% 25
Credit/Collections 19 90.48% 2 9.52% 21
EDI – Clearinghouse Vendor 10 62.50% 6 37.50% 16
Eligibility 10 52.63% 9 47.37% 19
Enterprise Master Patient Index (EMPI) 6 28.57% 15 71.43% 21
Patient Billing 26 96.30% 1 3.70% 27
Patient Scheduling 21 46.67% 24 53.33% 45
The majority of purchasing plans for RCM applications in 2008 • EDI: The EDI market shows moderate growth in 2008 across
were replacement purchases except for the bed management, EMPI, all hospital type segments (see Table RCM7). The rural and
and patient scheduling solutions (see Table RCM2), although patient single hospital segments demonstrated the highest growth of
scheduling was almost equally split between approximately eight percent.
new purchases and replacements. High replacement purchases • Eligibility: The eligibility transaction market shows the
signal that many of the RCM applications are legacy applications highest growth for 2008 was achieved in the rural and single
reaching the end of their product life cycles (e.g., patient billing, hospital segments (see Table RCM8). All market segments
ADT/registration, and credit and collections). We expect that achieved moderate growth (at least three percent) between
replacement purchasing will grow significantly for RCM applica- 2007 and 2008.
tions through 2010 due to impending regulations that will require • EMPI: The EMPI market demonstrated slight to moderate
significant changes for many RCM applications (e.g., HIPAA growth for all hospital type segments (see Table RCM9). The
claims attachment, severity adjusted DRGs, ICD-10 coding academic/teaching and single hospital systems had the highest
adoption, and adoption of pay-for-performance/quality outcomes growth from 2007 to 2008.
based reimbursement models). • Patient billing: The academic/teaching segment of the patient
billing market was saturated in 2008 (see Table RCM10). All
An evaluation of hospital type market segments for RCM applica-
other segments demonstrated very slight growth over 2007.
tions for 2007–2008 shows:
This market, while virtually saturated, is expected to become
• ADT/registration: The ADT/registration market is saturated
much more active as a replacement market through 2010 driven
in the academic/teaching segment, and close to saturation in
by new government regulations that were discussed in the
all other segments (see Table RCM3).
planned purchases (see Table RCM2).
• Bed management: The bed management market shows the
• Patient scheduling: The patient scheduling application market
academic/teaching, medical/surgical, urban, and multi-hospital
shows that the academic/teaching, medical/surgical, urban,
segments as the leading implementers of this application in
and multi-hospital segments are approaching saturation. Other
2008 (see Table RCM4).
non-medical/surgical hospitals, rural, and single hospitals
• Contract management: The contract management market had
demonstrated significant growth from 2007 to 2008. We expect to
the highest growth in the rural segment (three percent) and very
see both replacement and new sales increase as hospitals move to
slight growth across all other segments (see Table RCM5).
push patient scheduling functions to the Web to enhance cus-
• Credit/collections: The credit and collections application market
tomer service (see Table RCM11).
is nearing saturation in the academic/teaching, medical/surgical,
urban, and multi-hospital segments (see Table RCM6). The rural,
single hospital and other non-medical/surgical hospital segments
showed growth rates of four to five percent from 2007 to 2008.

 Revenue Cycle Management Environment (con tinue d)
Ta ble RCM3 | ADT/Registration
2006 2007 2008
Academic
Not Academic 3,181 85.53% 3,719 3,631 97.63% 3,719 3,686 99.11% 3,719
Med/Surg 2,238 94.11% 2,378 2,347 98.70% 2,378 2,366 99.50% 2,378
Med Surg
Other 1,197 74.95% 1,597 1,540 96.43% 1,597 1,576 98.69% 1,597
Rural 624 65.55% 952 896 94.12% 952 935 98.21% 952
Urban
Urban 2,811 92.99% 3,023 2,991 98.94% 3,023 3,007 99.47% 3,023
All 3,435 86.42% 3,975 3,887 97.79% 3,975 3,942 99.17% 3,975
Ta ble RCM4 | Bed Management

2006 2007 2008
Academic/Teaching N/A 0.00% 256 N/A 0.00% 256 74 28.91% 256
Academic
Not Academic N/A 0.00% 3,719 N/A 0.00% 3,719 549 14.76% 3,719
Med/Surg N/A 0.00% 2,378 N/A 0.00% 2,378 450 18.92% 2,378
Med Surg
Other N/A 0.00% 1,597 N/A 0.00% 1,597 173 10.83% 1,597
Rural N/A 0.00% 952 N/A 0.00% 952 57 5.99% 952
Urban
Urban N/A 0.00% 3,023 N/A 0.00% 3,023 566 18.72% 3,023
Single/Multi Multi-Hospital System N/A 0.00% 2,239 N/A 0.00% 2,239 412 18.40% 2,239
Hospital Single Hospital System N/A 0.00% 1,736 N/A 0.00% 1,736 211 12.15% 1,736
All N/A 0.00% 3,975 N/A 0.00% 3,975 623 15.67% 3,975
Ta ble RCM5 | Contract Management

2006 2007 2008
Academic
Not Academic 2,044 54.96% 3,719 2,255 60.63% 3,719 2,327 62.57% 3,719
Med/Surg 1,539 64.72% 2,378 1,658 69.72% 2,378 1,700 71.49% 2,378
Med Surg
Other 699 43.77% 1,597 797 49.91% 1,597 830 51.97% 1,597
Rural 281 29.52% 952 358 37.61% 952 386 40.55% 952
Urban
Urban 1,957 64.74% 3,023 2,097 69.37% 3,023 2,144 70.92% 3,023
All 2,238 56.30% 3,975 2,455 61.76% 3,975 2,530 63.65% 3,975
Ta ble RCM6 | Credit/Collections

2006 2007 2008
Academic
Not Academic 2,945 79.19% 3,719 3,208 86.26% 3,719 3,304 88.84% 3,719
Med/Surg 2,129 89.53% 2,378 2,207 92.81% 2,378 2,240 94.20% 2,378
Med Surg
Other 1,053 65.94% 1,597 1,237 77.46% 1,597 1,304 81.65% 1,597
Rural 542 56.93% 952 697 73.21% 952 752 78.99% 952
Urban
Urban 2,640 87.33% 3,023 2,747 90.87% 3,023 2,792 92.36% 3,023
All 3,182 80.05% 3,975 3,444 86.64% 3,975 3,544 89.16% 3,975
Ta ble RCM7 | EDI – Clearing House Vendor

2006 2007 2008
Academic
Not Academic 1,356 36.46% 3,719 2,107 56.66% 3,719 2,326 62.54% 3,719
Med/Surg 937 39.40% 2,378 1,441 60.60% 2,378 1,573 66.15% 2,378
Med Surg
Other 533 33.38% 1,597 826 51.72% 1,597 930 58.23% 1,597
Rural 253 26.58% 952 444 46.64% 952 527 55.36% 952
Urban
Urban 1,217 40.26% 3,023 1,823 60.30% 3,023 1,976 65.37% 3,023
Single/Multi Multi-Hospital System 933 41.67% 2,239 1,385 61.86% 2,239 1,487 66.41% 2,239
All 1,470 36.98% 3,975 2,267 57.03% 3,975 2,503 62.97% 3,975

Ta ble RCM8 | Eligibility
2006 2007 2008
Academic
Not Academic 1,494 40.17% 3,719 1,930 51.90% 3,719 2,106 56.63% 3,719
Med/Surg 1,189 50.00% 2,378 1,446 60.81% 2,378 1,544 64.93% 2,378
Med Surg
Other 462 28.93% 1,597 661 41.39% 1,597 750 46.96% 1,597
Rural 201 21.11% 952 345 36.24% 952 409 42.96% 952
Urban
Urban 1,450 47.97% 3,023 1,762 58.29% 3,023 1,885 62.36% 3,023
All 1,651 41.53% 3,975 2,107 53.01% 3,975 2,294 57.71% 3,975
Ta ble RCM9 | Enterprise Master Person Index

2006 2007 2008
Academic
Not Academic 1,068 28.72% 3,719 1,357 36.49% 3,719 1,480 39.80% 3,719
Med/Surg 810 34.06% 2,378 980 41.21% 2,378 1,059 44.53% 2,378
Med Surg
Other 362 22.67% 1,597 500 31.31% 1,597 557 34.88% 1,597
Rural 145 15.23% 952 238 25.00% 952 276 28.99% 952
Urban
Urban 1,027 33.97% 3,023 1,242 41.09% 3,023 1,340 44.33% 3,023
All 1,172 29.48% 3,975 1,480 37.23% 3,975 1,616 40.65% 3,975
Ta ble RCM10 | Patient Billing

2006 2007 2008
Academic
Not Academic 3,160 84.97% 3,719 3,632 97.66% 3,719 3,677 98.87% 3,719
Med/Surg 2,240 94.20% 2,378 2,355 99.03% 2,378 2,370 99.66% 2,378
Med Surg
Other 1,175 73.58% 1,597 1,533 95.99% 1,597 1,563 97.87% 1,597
Rural 623 65.44% 952 912 95.80% 952 940 98.74% 952
Urban
Urban 2,792 92.36% 3,023 2,976 98.45% 3,023 2,993 99.01% 3,023
All 3,415 85.91% 3,975 3,888 97.81% 3,975 3,933 98.94% 3,975
Ta ble RCM11 | Patient Scheduling

2006 2007 2008
Academic
Not Academic 2,345 63.05% 3,719 2,943 79.13% 3,719 3,311 89.03% 3,719
Med/Surg 1,785 75.06% 2,378 2,071 87.09% 2,378 2,226 93.61% 2,378
Med Surg
Other 785 49.15% 1,597 1,112 69.63% 1,597 1,333 83.47% 1,597
Rural 365 38.34% 952 572 60.08% 952 739 77.63% 952
Urban
Urban 2,205 72.94% 3,023 2,611 86.37% 3,023 2,820 93.28% 3,023
All 2,570 64.65% 3,975 3,183 80.08% 3,975 3,559 89.53% 3,975

The analysis of this market by bed size in 2008 reveals the following Ta ble rcm14
(see Tables RCM12–RCM18): 201–300 Beds 2006 2007 2008
• The ADT/registration market is saturated in the 201–500 and over % of 494 hospitals
600 bed segments. All other segments are close to saturation. ADT/Registration 492 99.60% 493 99.80% 494 100.00%
• The bed management market shows that hospitals with more

Bed Management NA NA NA NA 114 23.08%
Contract Management 353 71.46% 364 73.68% 369 74.70%
than 500 beds have the highest penetration. Approximately Credit/Collections 462 93.52% 467 94.53% 466 94.33%
one quarter of hospitals with between 201 and 500 beds have EDI – Clearinghouse Vendor 196 39.68% 301 60.93% 325 65.79%
installed this solution. Eligibility 265 53.64% 322 65.18% 338 68.42%
• The contract management market is 70 percent penetrated for Enterprise Master Patient
Index (EMPI) 187 37.85% 220 44.53% 240 48.58%
hospitals of over 100 beds. The 301–400 bed segment showed the Patient Billing 492 99.60% 493 99.80% 494 100.00%
largest percent of growth in 2008, while there was a decrease of Patient Scheduling 402 81.38% 455 92.11% 474 95.95%
penetration in hospitals with more than 600 beds.
• The credit and collections market is approaching saturation for
Ta ble rcm15
301–400 Beds 2006 2007 2008
all bed segments over 100 beds. The highest growth from 2007 % of 308 hospitals
to 2008 was in the 0–100 bed segment with an increase of ADT/Registration 308 100.00% 308 100.00% 308 100.00%
approximately four percent. Bed Management NA NA NA NA 78 25.32%
• The EDI market showed the highest growth from 2007 to 2008 Contract Management 226 73.38% 235 76.30% 244 79.22%
in the 0–100 bed and 401 to 500 bed segments. All segments Credit/Collections 287 93.18% 286 92.86% 287 93.18%
EDI – Clearinghouse Vendor 140 45.45% 200 64.94% 217 70.45%
demonstrated moderate growth in 2008, and the most penetrated Eligibility 169 54.87% 189 61.36% 205 66.56%
segment is the over-600 bed market. Enterprise Master Patient
• The eligibility transaction market had the highest growth in 2008 Index (EMPI) 127 41.23% 142 46.10% 150 48.70%
Patient Billing 308 100.00% 308 100.00% 308 100.00%
in the 0–100, 101 to 200, and 301–400 bed segments. The market Patient Scheduling 259 84.09% 279 90.58% 296 96.10%
is a minimum of 60 percent penetrated in all segments over 100
beds. Ta ble rcm16
• The EMPI application market experienced the highest growth 401–500 Beds 2006 2007 2008
in 2008 in the 201–300, and 401–600 bed segments. This market % of 179 hospitals
is only 50 percent penetrated in the over 400 bed market.

ADT/Registration 179 100.00% 179 100.00% 179 100.00%
Bed Management NA NA NA NA 51 28.49%
• The patient billing market is now saturated in the over Contract Management 141 78.77% 147 82.12% 148 82.68%
200 bed segment. The highest growth, at two percent, was Credit/Collections 171 95.53% 171 95.53% 172 96.09%
in the 0–100 bed segment. EDI – Clearinghouse Vendor 75 41.90% 107 59.78% 119 66.48%
• The patient scheduling application system demonstrated the Eligibility 109 60.89% 118 65.92% 122 68.16%
Enterprise Master Patient
highest growth in 2008 in the 0–100 bed segment, an increase Index (EMPI) 71 39.66% 84 46.93% 92 51.40%
of 14 percent. All segments over 100 beds are approaching Patient Billing 179 100.00% 179 100.00% 179 100.00%
saturation. Patient Scheduling 150 83.80% 164 91.62% 171 95.53%
Ta ble rcm12 Ta ble rcm17

0–100 Beds 2006 2007 2008 501–600 Beds 2006 2007 2008
% of 1,931 hospitals % of 117 hospitals
ADT/Registration 1,403 72.66% 1,847 95.65% 1,901 98.45% ADT/Registration 116 99.15% 117 100.00% 116 99.15%
Bed Management NA NA NA NA 177 9.17% Bed Management NA NA NA NA 37 31.62%
Contract Management 781 40.45% 926 47.95% 973 50.39% Contract Management 89 76.07% 93 79.49% 94 80.34%
Credit/Collections 1,268 65.67% 1,513 78.35% 1,600 82.86% Credit/Collections 109 93.16% 110 94.02% 111 94.87%
EDI – Clearinghouse Vendor 608 31.49% 1,004 51.99% 1,128 58.42% EDI – Clearinghouse Vendor 41 35.04% 71 60.68% 77 65.81%
Eligibility 547 28.33% 809 41.90% 917 47.49% Eligibility 69 58.97% 80 68.38% 84 71.79%
Enterprise Master Patient Enterprise Master Patient
Index (EMPI) 392 20.30% 566 29.31% 633 32.78% Index (EMPI) 46 39.32% 54 46.15% 59 50.43%
Patient Billing 1,382 71.57% 1,848 95.70% 1,890 97.88% Patient Billing 117 100.00% 117 100.00% 117 100.00%
Patient Scheduling 907 46.97% 1,338 69.29% 1,610 83.38% Patient Scheduling 107 91.45% 113 96.58% 115 98.29%
Ta ble rcm13 Ta ble rcm18

101–200 Beds 2006 2007 2008 600+ Beds 2006 2007 2008
% of 803 hospitals % of 143 hospitals
ADT/Registration 794 98.88% 800 99.63% 801 99.75% ADT/Registration 143 100.00% 143 100.00% 143 100.00%
Bed Management NA NA NA NA 121 15.07% Bed Management NA NA NA NA 45 31.47%
Contract Management 540 67.25% 574 71.48% 589 73.35% Contract Management 108 75.52% 116 81.12% 113 79.02%
Credit/Collections 754 93.90% 764 95.14% 773 96.26% Credit/Collections 131 91.61% 133 93.01% 135 94.41%
EDI – Clearinghouse Vendor 339 42.22% 484 60.27% 530 66.00% EDI – Clearinghouse Vendor 71 49.65% 100 69.93% 107 74.83%
Eligibility 401 49.94% 487 60.65% 520 64.76% Eligibility 91 63.64% 102 71.33% 108 75.52%
Enterprise Master Patient Enterprise Master Patient
Index (EMPI) 284 35.37% 334 41.59% 360 44.83% Index (EMPI) 65 45.45% 80 55.94% 82 57.34%
Patient Billing 794 98.88% 800 99.63% 802 99.88% Patient Billing 143 100.00% 143 100.00% 143 100.00%
Patient Scheduling 617 76.84% 699 87.05% 752 93.65% Patient Scheduling 128 89.51% 135 94.41% 141 98.60%

In evaluating the contract purchasing time frames for RCM Ta ble RCM21
applications in 2008, most of the contracting for the legacy # for Contract
environments (e.g., ADT/registration, credit-collections, and 2008 Range Total % of Total
Enterprise Master Person Index (EMPI)
patient billing applications) was completed between 1995 and 1999. Prior to 1990 22 1,003 2.19%
Contracting for contract management, EDI, eligibility, EMPI, and 1990 to 1994 82 1,003 8.18%
patient scheduling was mostly concluded in the 2000–2004 time 1995 to 1999 205 1,003 20.44%
period (see Tables RCM18 to RCM22). The most recently intro- 2000 to 2004 438 1,003 43.67%
duced application, bed management, has experienced the highest 2005 to 2008 256 1,003 25.52%
Total 1,003 1,003 100.00%
contracting in the 2005–2008 time frame, as would be expected. Patient Billing
This is consistent with the 2007 contract signing findings. RCM Prior to 1990 226 2,948 7.67%
applications that were contracted prior to 1995 are most likely 1990 to 1994 505 2,948 17.13%
subject to replacement over the next three to five years. 1995 to 1999 912 2,948 30.94%
2000 to 2004 830 2,948 28.15%
Ta ble RCM18 2005 to 2008 475 2,948 16.11%
# for Contract Total 2,948 2,948 100.00%
2008 Range Total % of Total
ADT/ Registration Ta ble RCM22
Prior to 1990 217 3,079 7.05% # for Contract
1990 to 1994 514 3,079 16.69% 2008 Range Total % of Total
1995 to 1999 956 3,079 31.05% Patient Scheduling
2000 to 2004 906 3,079 29.43% Prior to 1990 74 2,357 3.14%
2005 to 2008 486 3,079 15.78% 1990 to 1994 312 2,357 13.24%
Total 3,079 3,079 100.00% 1995 to 1999 655 2,357 27.79%
Bed Management 2000 to 2004 859 2,357 36.44%
Prior to 1990 9 173 5.20% 2005 to 2008 457 2,357 19.39%
1990 to 1994 18 173 10.40% Total 2,357 2,357 100.00%
1995 to 1999 22 173 12.72%
2000 to 2004 48 173 27.75% Market Drivers/Factors
2005 to 2008 76 173 43.93% The RCM IT application market has been and will continue
Total 173 173 100.00% to be impacted through 2010 by:
Ta ble RCM19
• Lack of access to capital to fund RCM application purchases
# for Contract in 2009.
2008 Range Total % of Total • The impending HIPAA claims attachment regulations.
Contract Management • The impending severity adjusted DRG regulations.
Prior to 1990 53 1,615 3.28%
1990 to 1994 153 1,615 9.47%
• The conversion to ICD-10-CM and ICD-10-PCS coding
1995 to 1999 433 1,615 26.81% currently scheduled for October 1, 2013.
2000 to 2004 656 1,615 40.62% • The emergence of outcomes-based reimbursement models.
2005 to 2008 320 1,615 19.81% • The focus on consumer/patient satisfaction (e.g., pricing
Total 1,615 1,615 100.00%
transparency, consumer friendly billing formats).
Credit Collections
Prior to 1990 171 2,650 6.45%
• The need to more effectively integrate financial and clinical
1990 to 1994 485 2,650 18.30% data for business analysis.
1995 to 1999 824 2,650 31.09% • The focus on improving patient satisfaction throughout the
2000 to 2004 759 2,650 28.64% entire RCM process, but more specifically on Web scheduling,
2005 to 2008 411 2,650 15.51%
registration and bill payment functions.
Total 2,650 2,650 100.00%
• Preparation for the new V5010 transaction code sets by
Ta ble RCM20 January 1, 2012.
# for Contract
EDI – Clearing House Vendor
Prior to 1990 15 833 1.80%
1990 to 1994 66 833 7.92%
1995 to 1999 182 833 21.85%
2000 to 2004 310 833 37.21%
2005 to 2008 260 833 31.21%
Total 833 833 100.00%
Eligibility
Prior to 1990 26 1,071 2.43%
1990 to 1994 97 1,071 9.06%
1995 to 1999 225 1,071 21.01%
2000 to 2004 410 1,071 38.28%
2005 to 2008 313 1,071 29.23%
Total 1,071 1,071 100.00%

 Next Generation Revenue Cycle Management Index
This is the second year of reporting on the next generation needs, strategies, and their competitive environment. The results
revenue cycle management (NGRCM) index functions that is from 2007 and 2008 cannot be compared due to changes in the
intended to reflect the adoption of RCM solutions that improve 2008 survey and some definition changes we made in 2008. The
patient satisfaction and convenience, while improving the overall market adoption rates after these changes were made to the HIMSS
efficiency of the NGRCM process. This index is based on four Analytics Database are shown in Table NGRCM1 for 2008.
NGRCM components that improve both upstream and downstream
An evaluation of this market in 2008 by hospital type shows the
processes in the RCM environment:
following trends:
• Consumer focus – The ability of the NGRCM environment to
extend Web services (Business 2 Consumer) to patients for CONSUMER F OCUS
registration, scheduling, and bill payment to enhance patient • Web pre-registration has the highest adoption rate in academic/
service efficiency and convenience. teaching, medical/surgical, urban, and multi-hospital systems (see
• Rules capability – A rules engine environment (user managed Table NGRCM2).
without the need for programming skills) that provides medical • Web scheduling has its highest adoption in academic/teaching
necessity checking rules in scheduling and registration functions, (see Table NGRCM3).
rules for determining claims attachments needed to void payers • Web payment has the highest adoption rates in academic/
pending claims payment, and rules for ensuring all required teaching, medical/surgical, urban and multi-hospital segments
claims information to mitigate the rejection or denial of claims (see Table NGRCM4).
(Business 2 Business). RULE S C A PA BILI T IE S
• Billing – An environment that allows business office personnel • Medical necessity alerts at the point of scheduling have
to edit bills as needed to improve billing accuracy and provide the highest adoption rates with academic/teaching hospitals
the necessary updates to all billing and accounts receivable files (see Table NGRCM5).
related to the edits. These tools will also accommodate the • Medical necessity alerts at point of registration have the
auto-encoding of clinical information from the electronic medical highest rates of adoption in academic/teaching and medical/
record (EMR) system to expedite and improve efficiency and surgical hospitals (see Table NGRCM6).
accuracy of the billing process. • Claims attachment rules have the highest adoption rates
• Claims – The ability to submit claims directly to payers without at academic/teaching hospitals, followed by medical/surgical
using a clearinghouse intermediary, and accepting direct electronic hospitals (see Table NGRCM7).
claims remittance transactions from payers for updating patient • Denials rules also have the highest adoption rates with
specific receivables from bundled payer remittance transactions. academic/teaching hospitals followed by urban hospitals
This environment should also allow direct eligibility transactions (see Table NGRCM8).
in real-time with payers to provide risk mitigation against services
that are not covered by the payer and to enable concurrent patient BILLING
deductible collection. Finally, this environment should accommo- • Biller’s dashboard has the highest adoption rates with
date electronic funds transfer from the payer to the provider academic/teaching hospitals followed by single hospital
organization’s banking service to improve cash flow systems (see Table NGRCM9).
for the organization. • EMR documentation for claims shows the highest adoption
rate with academic/teaching hospitals (see Table NGRCM10).
Ta ble NGRCM1 | Percentages of Hospitals That Said They
Have These Products
This function has the lowest current market adoption rate,
N=3,975 which is to be expected with most hospitals not having imple-
Biller’s Dash Board 8.60% mented the more sophisticated EMR applications (e.g., clinical
Claims Attachment Rules 7.90% documentation, physician documentation).
Claims Remittance Updates AR 5.96%
Denial Rules 7.35% CL A IMS
Direct Payer Claims 5.01% • Direct payer claims (no clearinghouse) has the highest adoption
Electronic Funds Transfer (EFT) Transaction 8.23% rates at academic/teaching hospitals (see Table NGRCM11).
Eligibility Transaction with Payer 5.81%
• Claims remittance with accounts receivable update has
EMR Documentation for Claims 4.43%
Necessity Alert @ Registration 8.40% the highest adoption rates at academic/teaching hospitals
Necessity Alert @ Scheduling 7.67% (see Table NGRCM12).
Web PreRegister 13.51% • Eligibility transaction with payer (no clearinghouse) has
Web Schedule 6.01% the highest adoption rate in the academic/teaching hospitals
Web Self Pay 22.39%
(see Table NGRCM13).
This index is designed for hospitals to compare their capabilities • Electronic funds transfer transactions (direct to organization’s
against the market, and their peers, for these NGRCM functions. bank) has the highest adoption rates with academic/teaching
Hospital requirements for adoption will be based on business hospitals followed by single hospital systems (see Table
NGRCM14).

 Next Generation Revenue Cycle Management Index (con tinue d)
Ta ble NGRCM2 | Web Pre-Register Ta ble NGRCM7 | Claims Attachment Rules
2008 2008
Segment Total Segment Total
Count Percent Count Count Percent Count
Academic/Teaching 49 19.14% 256 Academic/Teaching 28 10.94% 256
Academic Academic
Not Academic 488 13.12% 3,719 Not Academic 286 7.69% 3,719
Med/Surg 412 17.33% 2,378 Med/Surg 224 9.42% 2,378
Med Surg Med Surg
Other 125 7.83% 1,597 Other 90 5.64% 1,597
Rural 47 4.94% 952 Rural 46 4.83% 952
Urban Urban
Urban 490 16.21% 3,023 Urban 268 8.87% 3,023
Single/Multi Multi-Hospital System 383 17.11% 2,239 Single/Multi Multi-Hospital System 166 7.41% 2,239
Hospital Single Hospital System 154 8.87% 1,736 Hospital Single Hospital System 148 8.53% 1,736
All 537 13.51% 3,975 All 314 7.90% 3,975
Ta ble NGRCM3 | Web Schedule Ta ble NGRCM8 | Denial Rules

2008 2008
Academic Academic
Med/Surg 174 7.32% 2,378 Med/Surg 189 7.95% 2,378
Med Surg Med Surg
Other 65 4.07% 1,597 Other 103 6.45% 1,597
Rural 17 1.79% 952 Rural 46 4.83% 952
Urban Urban
Urban 222 7.34% 3,023 Urban 246 8.14% 3,023
All 239 6.01% 3,975 All 292 7.35% 3,975
Ta ble NGRCM4 | Web Self Pay Ta ble NGRCM9 | Biller’s Dashboard

2008 2008
Academic Academic
Med/Surg 657 27.63% 2,378 Med/Surg 226 9.50% 2,378
Med Surg Med Surg
Other 233 14.59% 1,597 Other 116 7.26% 1,597
Rural 125 13.13% 952 Rural 71 7.46% 952
Urban Urban
Urban 765 25.31% 3,023 Urban 271 8.96% 3,023
All 890 22.39% 3,975 All 342 8.60% 3,975
Ta ble NGRCM5 | Necessity Alert @ Scheduling Ta ble NGRCM10 | EMR Documentation for Claims
2008 2008
Academic Academic
Med/Surg 211 8.87% 2,378 Med/Surg 121 5.09% 2,378
Med Surg Med Surg
Other 94 5.89% 1,597 Other 55 3.44% 1,597
Rural 49 5.15% 952 Rural 24 2.52% 952
Urban Urban
Urban 256 8.47% 3,023 Urban 152 5.03% 3,023
All 305 7.67% 3,975 All 176 4.43% 3,975
Ta ble NGRCM6 | Necessity Alert @ Registration Ta ble NGRCM11 | Direct Payer Claims
2008 2008
Academic Academic
Med/Surg 238 10.01% 2,378 Med/Surg 116 4.88% 2,378
Med Surg Med Surg
Other 96 6.01% 1,597 Other 83 5.20% 1,597
Rural 61 6.41% 952 Rural 44 4.62% 952
Urban Urban
Urban 273 9.03% 3,023 Urban 155 5.13% 3,023
All 334 8.40% 3,975 All 199 5.01% 3,975

Ta ble NGRCM12 | Claims Remittance Updates AR Ta ble NGRCM16
2008 101–200 Beds 2008
Segment Total % of 803 hospitals
Count Percent Count Biller’s Dash Board 67 8.34%
Academic/Teaching 26 10.16% 256 Claims Attachment Rules 75 9.34%
Academic
Not Academic 211 5.67% 3,719 Claims Remittance Updates AR 42 5.23%
Med/Surg 154 6.48% 2,378 Denial Rules 61 7.60%
Med Surg
Other 83 5.20% 1,597 Direct Payer Claims 33 4.11%
Rural 40 4.20% 952 EFT Transaction 62 7.72%
Urban
Urban 197 6.52% 3,023 Eligibility Transaction with Payer 48 5.98%
Single/Multi Multi-Hospital System 118 5.27% 2,239 EMR Documentation for Claims 32 3.99%
Hospital Single Hospital System 119 6.85% 1,736 Necessity Alert @ Registration 69 8.59%
All 237 5.96% 3,975 Necessity Alert @ Scheduling 63 7.85%
Web PreRegister 129 16.06%
Ta ble NGRCM13 | Eligibility Transaction With Payer Web Schedule 43 5.35%
2008 Web Self Pay 214 26.65%
Segment Total
Count Percent Count
Ta ble NGRCM17
Academic/Teaching 26 10.16% 256
Academic 201–300 Beds 2008
Not Academic 205 5.51% 3,719
% of 494 hospitals
Med/Surg 147 6.18% 2,378
Med Surg Biller’s Dash Board 54 10.93%
Other 84 5.26% 1,597
Claims Attachment Rules 62 12.55%
Rural 43 4.52% 952
Urban Claims Remittance Updates AR 40 8.10%
Urban 188 6.22% 3,023
Denial Rules 53 10.73%
Single/Multi Multi-Hospital System 103 4.60% 2,239
Hospital Direct Payer Claims 30 6.07%
Single Hospital System 128 7.37% 1,736
EFT Transaction 50 10.12%
All 231 5.81% 3,975
Eligibility Transaction with Payer 39 7.89%
EMR Documentation for Claims 34 6.88%
Ta ble NGRCM14 | EFT Transaction
Necessity Alert @ Registration 57 11.54%
2008
Necessity Alert @ Scheduling 52 10.53%
Segment Total
Count Percent Count Web PreRegister 98 19.84%
Web Schedule 60 12.15%
Academic/Teaching 31 12.11% 256
Academic Web Self Pay 156 31.58%
Not Academic 296 7.96% 3,719
Med/Surg 202 8.49% 2,378
Med Surg Ta ble NGRCM18
Other 125 7.83% 1,597
Rural 65 6.83% 952 301–400 Beds 2008
Urban % of 308 hospitals
Urban 262 8.67% 3,023
Single/Multi Multi-Hospital System 150 6.70% 2,239 Biller’s Dash Board 28 9.09%
Hospital Single Hospital System 177 10.20% 1,736 Claims Attachment Rules 30 9.74%
All 327 8.23% 3,975 Claims Remittance Updates AR 25 8.12%
Direct Payer Claims 18 5.84%
Ta ble NGRCM15
0–100 Beds 2008
Biller’s Dash Board 147 7.61%
Claims Remittance Updates AR 95 4.92%
Web Self Pay 104 33.77%
Ta ble NGRCM19
401–500 Beds 2008
Necessity Alert @ Scheduling 115 5.96% % of 179 hospitals
Web PreRegister 140 7.25% Biller’s Dash Board 19 10.61%
Web Schedule 52 2.69% Claims Attachment Rules 15 8.38%
Web Self Pay 300 15.54% Claims Remittance Updates AR 11 6.15%

Ta ble NGRCM20 • 101–200 beds – Web self pay and Web pre-registration
501–600 Beds 2008 are most frequently installed at hospitals of this size
% of 117 hospitals (see Table NGRCM16).
Biller’s Dash Board 12 10.26% • 201–300 beds – The most frequently installed solutions at
these hospitals are Web self pay and Web pre-registration
Claims Remittance Updates AR 12 10.26%
Denial Rules 12 10.26% (see Table NGRCM17).
Direct Payer Claims 5 4.27% • 301–400 beds – Web self pay and Web pre-registration
EFT Transaction 10 8.55% are most frequently installed at hospitals of this size
(see Table NGRCM18).
• 401–500 beds – The most frequently installed solutions
Necessity Alert @ Scheduling 17 14.53% at these hospitals are Web self pay and Web pre-registration
Web PreRegister 26 22.22% (see Table NGRCM19).
Web Schedule 11 9.40% • 501–600 beds – Web self pay and Web pre-registration
are most frequently installed at hospitals of this size
Ta ble NGRCM21
(see Table NGRCM20)
600+ Beds 2008 • Greater than 600 beds – These hospitals are most likely to have
% of 143 hospitals Web self pay and Web pre-registration (see Table NGRCM21)
Biller’s Dash Board 15 10.49%
Claims Remittance Updates AR 12 8.39% The NGRCM market is still in its infancy, but these applications will
Denial Rules 16 11.19% be become critical solutions for all hospitals within the next five
Direct Payer Claims 13 9.09% years. This market will continue to be impacted through 2010 by:
• Lack of access to capital which may drive hospitals to evaluate
EMR Documentation for Claims 9 6.29% bolt-on NGRCM applications to enhance their existing RCM
Necessity Alert @ Registration 14 9.79% environments, thus extending the useful life of legacy RCM envi-
Necessity Alert @ Scheduling 14 9.79% ronments.
Web PreRegister 28 19.58% • Hospitals trying to gain competitive advantage in their markets
with enhanced consumer functions.
• Hospitals re-engineering their revenue cycle management
An evaluation of adoption of NGRCM functions by hospital bed processes to improve efficiency and financial stability.
size segments provides the following insights from 2008: • Continued regulatory pressures that drive hospitals to become
• Web self pay installations are highest of all NGRCM functions more efficient in their delivery of care and documenting
across the bed segments. that care.
• Web pre-registration is mentioned as the second highest of all • The success of pioneering organizations (most often academic
NGRCM functions across all the bed segments with the excep- medical centers) in their implementation of NGRCM applications
tion of the 0–100 bed segment (see Tables NGRCM 16–21). to drive this market forward.
• Biller’s dashboard is mentioned second most frequently for the • Successes in NGRCM projects to drive improved cash flow that
0–100 bed segment (see Table NGRCM 15). can help fund additional IT investments.
• 0–100 beds – Web-based self pay is most frequently installed
at hospitals in this bed range (see Table NGRCM15).
 Health Information Management

The Health Information Management (HIM) Department IT market Ta ble HIM1 | Percentages Represent Live and Operational,
segment has reached a near saturation stage for abstracting and Contracted, or Implementations in Process
encoder application systems in 2008 (see Table HIM1). The best N=3,975 2006 2007 2008
growth potential for this market segment will be found in data Abstracting 84.10% 92.88% 94.74%
Case Mix Management 73.84% 77.01% 78.59%
warehousing/mining-clinical, dictation with speech recognition, Chart Deficiency 79.95% 86.47% 88.81%
encoding (due to ICD-10 upgrade requirements), outcomes and Chart Tracking Locator 79.17% 84.48% 87.07%
quality management and outsourced transcription. We believe Data Warehousing/Mining – Clinical 16.93% 20.91% 22.77%
in-house transcription will begin to show a decline as outsourced Dictation 75.60% 84.40% 87.42%
solutions for this application become more competitive and more

Dictation with Speech Recognition 11.32% 16.38% 19.92%
Encoder 82.42% 92.83% 94.64%
physician documentation applications are implemented. Other Outcomes and Quality Management 54.44% 61.01% 64.23%
applications that may become obsolete as EMR applications are In-House Transcription 70.67% 76.38% 77.41%
implemented are the chart deficiency and chart tracking/locator. Outsourced Transcription 5.56% 6.69% 8.70%

 Health Information Management (con tinued)
Ta ble HIm2 | 2008
Abstracting 29 80.56% 7 19.44% 36
Case Mix Management 12 92.31% 1 7.69% 13
Chart Deficiency 27 81.82% 6 18.18% 33
Chart Tracking/Locator 24 80.00% 6 20.00% 30
Data Warehousing/Mining – Clinical 0 0.00% 6 100.00% 6
Dictation 12 80.00% 3 20.00% 15
Dictation with Speech Recognition 0 0.00% 36 100.00% 36
Encoder 7 43.75% 9 56.25% 16
Outcomes and Quality Management 8 47.06% 9 52.94% 17
In-House Transcription 9 100.00% 0 0.00% 9
Outsourced Transcription 0 0.00% 0 0.00% 0
The purchasing plans for HIM applications are predominately more than four percent growth from 2007 to 2008
replacement purchases for legacy application environments, (see Table HIM5).
with the exception of the encoding segment in 2008. The legacy • Chart tracking/locator: the highest growth segments were
applications for this market are abstracting, case mix management, other non-medical/surgical hospitals, rural and single hospital
chart deficiency, chart tracking/locator, dictation, encoder, and systems (see Table HIM6).
in-house transcription. Applications that reflect predominately new • Data warehousing-clinical had the highest growth in the
purchases represent first generation products that are achieving academic medical center hospitals, which is to be expected
increased stability, such as data warehousing/mining – clinical for an emerging application (see Table HIM7).
dictation with speech recognition (see Table HIM2). While our data • Dictation: rural and single hospital systems were the highest
showed no plans for outsourced transcription in 2008, we growth segments for this application, with growth rates of at least
also believe that this market will emerge even as capital markets five percent (see Table HIM8).
remain tight. The purchasing plan for outcomes and quality • Dictation with speech recognition: academic medical center,
management are almost equal in the number of first time and medical/surgical, and urban hospitals were the highest growth
replacement purchases. segments in 2008 (see Table HIM9).
• Encoder: other non-medical/surgical, rural, and single hospitals
An evaluation of hospital-type market segments for highest
showed the highest growth (see Table HIM10).
growth per segment from 2007–2008 shows the following:
• Outcomes and quality management: single hospitals had the
• Abstracting: the highest growth segments were other non-
highest growth in 2008 for this application (see Table HIM11).
medical/surgical hospitals, rural, and single hospital systems with
• In-house transcription had the highest growth rates in rural and
approximately three percent growth from 2007 to 2008
single hospital systems. This area also showed declines among
(see Table HIM3).
academic/teaching, medical/surgical, urban and multi-hospital
• Case mix: the highest growth segments were other non-
system hospitals (see Table HIM12).
medical/surgical hospitals, rural, and single hospital systems (see
• Outsourced transcription: medical/surgical and multi-
Table HIM4).
hospital systems had the highest growth for this application
• Chart deficiency: the highest growth segments were other non-
(see Table HIM13).
medical/surgical hospitals, rural, and single hospital systems with
Ta ble HIM3 | Abstracting

2006 2007 2008
Academic
Not Academic 3,091 83.11% 3,719 3,438 92.44% 3,719 3,512 94.43% 3,719
Med/Surg 2,216 93.19% 2,378 2,318 97.48% 2,378 2,347 98.70% 2,378
Med Surg
Other 1,127 70.57% 1,597 1,374 86.04% 1,597 1,419 88.85% 1,597
Rural 579 60.82% 952 781 82.04% 952 813 85.40% 952
Urban
Urban 2,764 91.43% 3,023 2,911 96.30% 3,023 2,953 97.68% 3,023
All 3,343 84.10% 3,975 3,692 92.88% 3,975 3,766 94.74% 3,975

Ta ble HIM4 | Case Mix Management
2006 2007 2008
Academic
Not Academic 2,697 72.52% 3,719 2,821 75.85% 3,719 2,884 77.55% 3,719
Med/Surg 1,996 83.94% 2,378 2,029 85.32% 2,378 2,056 86.46% 2,378
Med Surg
Other 939 58.80% 1,597 1,032 64.62% 1,597 1,068 66.88% 1,597
Rural 460 48.32% 952 523 54.94% 952 554 58.19% 952
Urban
Urban 2,475 81.87% 3,023 2,538 83.96% 3,023 2,570 85.01% 3,023
All 2,935 73.84% 3,975 3,061 77.01% 3,975 3,124 78.59% 3,975
Ta ble HIM5 | Chart Deficiency

2006 2007 2008
Academic
Not Academic 2,930 78.78% 3,719 3,184 85.61% 3,719 3,277 88.12% 3,719
Med/Surg 2,180 91.67% 2,378 2,267 95.33% 2,378 2,296 96.55% 2,378
Med Surg
Other 998 62.49% 1,597 1,170 73.26% 1,597 1,234 77.27% 1,597
Rural 475 49.89% 952 615 64.60% 952 665 69.85% 952
Urban
Urban 2,703 89.41% 3,023 2,822 93.35% 3,023 2,865 94.77% 3,023
All 3,178 79.95% 3,975 3,437 86.47% 3,975 3,530 88.81% 3,975
Ta ble HIM6 | Chart Tracking – Locator

2006 2007 2008
Academic
Not Academic 2,899 77.95% 3,719 3,106 83.52% 3,719 3,208 86.26% 3,719
Med/Surg 2,160 90.83% 2,378 2,232 93.86% 2,378 2,265 95.25% 2,378
Med Surg
Other 987 61.80% 1,597 1,126 70.51% 1,597 1,196 74.89% 1,597
Rural 467 49.05% 952 578 60.71% 952 632 66.39% 952
Urban
Urban 2,680 88.65% 3,023 2,780 91.96% 3,023 2,829 93.58% 3,023
All 3,147 79.17% 3,975 3,358 84.48% 3,975 3,461 87.07% 3,975
Ta ble HIM7 | Data Warehousing – Clinical

2006 2007 2008
Academic
Not Academic 606 16.29% 3,719 750 20.17% 3,719 813 21.86% 3,719
Med/Surg 416 17.49% 2,378 532 22.37% 2,378 578 24.31% 2,378
Med Surg
Other 257 16.09% 1,597 299 18.72% 1,597 327 20.48% 1,597
Rural 61 6.41% 952 78 8.19% 952 92 9.66% 952
Urban
Urban 612 20.24% 3,023 753 24.91% 3,023 813 26.89% 3,023
All 673 16.93% 3,975 831 20.91% 3,975 905 22.77% 3,975
Ta ble HIM8 | Dictation

2006 2007 2008
Academic
Not Academic 2,776 74.64% 3,719 3,116 83.79% 3,719 3,232 86.91% 3,719
Med/Surg 2,017 84.82% 2,378 2,140 89.99% 2,378 2,210 92.94% 2,378
Med Surg
Other 988 61.87% 1,597 1,215 76.08% 1,597 1,265 79.21% 1,597
Rural 492 51.68% 952 660 69.33% 952 718 75.42% 952
Urban
Urban 2,513 83.13% 3,023 2,695 89.15% 3,023 2,757 91.20% 3,023
All 3,005 75.60% 3,975 3,355 84.40% 3,975 3,475 87.42% 3,975

Ta ble HIM9 | Dictation with Speech Recognition
2006 2007 2008
Academic
Not Academic 385 10.35% 3,719 568 15.27% 3,719 692 18.61% 3,719
Med/Surg 296 12.45% 2,378 455 19.13% 2,378 555 23.34% 2,378
Med Surg
Other 154 9.64% 1,597 196 12.27% 1,597 237 14.84% 1,597
Rural 39 4.10% 952 58 6.09% 952 65 6.83% 952
Urban
Urban 411 13.60% 3,023 593 19.62% 3,023 727 24.05% 3,023
All 450 11.32% 3,975 651 16.38% 3,975 792 19.92% 3,975
Ta ble HIM10 | Encoder

2006 2007 2008
Academic
Not Academic 3,024 81.31% 3,719 3,434 92.34% 3,719 3,506 94.27% 3,719
Med/Surg 2,207 92.81% 2,378 2,328 97.90% 2,378 2,355 99.03% 2,378
Med Surg
Other 1,069 66.94% 1,597 1,362 85.28% 1,597 1,407 88.10% 1,597
Rural 534 56.09% 952 774 81.30% 952 804 84.45% 952
Urban
Urban 2,742 90.70% 3,023 2,916 96.46% 3,023 2,958 97.85% 3,023
All 3,276 82.42% 3,975 3,690 92.83% 3,975 3,762 94.64% 3,975
Ta ble HIM11 | Outcomes and Quality Management

2006 2007 2008
Academic
Not Academic 1,971 53.00% 3,719 2,221 59.72% 3,719 2,345 63.05% 3,719
Med/Surg 1,521 63.96% 2,378 1,656 69.64% 2,378 1,744 73.34% 2,378
Med Surg
Other 643 40.26% 1,597 769 48.15% 1,597 809 50.66% 1,597
Rural 245 25.74% 952 343 36.03% 952 375 39.39% 952
Urban
Urban 1,919 63.48% 3,023 2,082 68.87% 3,023 2,178 72.05% 3,023
All 2,164 54.44% 3,975 2,425 61.01% 3,975 2,553 64.23% 3,975
Ta ble HIM12 | In House Transcription

2006 2007 2008
Academic
Not Academic 2,603 69.99% 3,719 2,834 76.20% 3,719 2,882 77.49% 3,719
Med/Surg 1,897 79.77% 2,378 1,930 81.16% 2,378 1,920 80.74% 2,378
Med Surg
Other 912 57.11% 1,597 1,106 69.25% 1,597 1,157 72.45% 1,597
Rural 468 49.16% 952 629 66.07% 952 690 72.48% 952
Urban
Urban 2,341 77.44% 3,023 2,407 79.62% 3,023 2,387 78.96% 3,023
All 2,809 70.67% 3,975 3,036 76.38% 3,975 3,077 77.41% 3,975
Ta ble HIM13 | Outsourced Transcription

2006 2007 2008
Academic
Not Academic 187 5.03% 3,719 230 6.18% 3,719 306 8.23% 3,719
Med/Surg 131 5.51% 2,378 161 6.77% 2,378 231 9.71% 2,378
Med Surg
Other 90 5.64% 1,597 105 6.57% 1,597 115 7.20% 1,597
Rural 22 2.31% 952 27 2.84% 952 37 3.89% 952
Urban
Urban 199 6.58% 3,023 239 7.91% 3,023 309 10.22% 3,023
All 221 5.56% 3,975 266 6.69% 3,975 346 8.70% 3,975

The analysis of this market by bed size for the 2007–2008 periods Ta ble HIm15
showed the following market activity (see Tables HIM14–HIM20): 101–200 Beds 2006 2007 2008
• Abstracting: almost all bed size segments are approaching % of 803 hospitals
market saturation, and the 401–500 bed market is totally Abstracting 787 98.01% 793 98.75% 799 99.50%
saturated.
Case Mix Management 708 88.17% 714 88.92% 711 88.54%
Chart Deficiency 771 96.01% 779 97.01% 785 97.76%
• Case mix: there was very slight growth for most bed size Chart Tracking/ Locator 768 95.64% 772 96.14% 777 96.76%
segments for case mix, and under 100 bed and 501–600 bed Data Warehousing/
segment demonstrated the highest growth in 2008. Installation Mining – Clinical 138 17.19% 189 23.54% 198 24.66%
Dictation 722 89.91% 746 92.90% 763 95.02%
rates actually decreased slightly at hospitals with 101 to 200 beds Dictation with Speech
and 401 to 500 beds. Recognition 104 12.95% 150 18.68% 181 22.54%
• Chart deficiency: very slight growth was observed for this Encoder 785 97.76% 795 99.00% 799 99.50%
Outcomes and Quality
application with only the 0–100 bed segment showing any Management 530 66.00% 577 71.86% 601 74.84%
significant growth. In the 501–600 bed segments the percentage of In-House Transcription 691 86.05% 677 84.31% 662 82.44%
applications actually decreased which may indicate that EMRs in Outsourced Transcription 37 4.61% 47 5.85% 76 9.46%
this market segment are beginning to make this

Ta ble HIm16
application obsolete. 201–300 Beds 2006 2007 2008
• Chart tracking/locator: the highest growth segment is the % of 494 hospitals
0–100 bed segment, and the decrease in the number of installa- Abstracting 489 98.99% 490 99.19% 491 99.39%
tions from 2007 to 2008 in the 501–600 bed segment may Case Mix Management 448 90.69% 446 90.28% 447 90.49%
indicate that EMRs are making this application obsolete. Chart Deficiency 485 98.18% 486 98.38% 488 98.79%
Chart Tracking/ Locator 477 96.56% 481 97.37% 482 97.57%
• Data warehousing – clinical: this is a relatively new application Data Warehousing/
for evaluating outcomes and protocols and is currently showing Mining – Clinical 107 21.66% 134 27.13% 146 29.55%
the most growth in the 301–400 and 401–500 bed size segments. Dictation 440 89.07% 452 91.50% 459 92.91%
• Dictation: dictation showed very slight growth in all segments

Dictation with Speech
Recognition 79 15.99% 100 20.24% 132 26.72%
and the 0–100 bed and 501 to 600 bed segments demonstrating Encoder 481 97.37% 485 98.18% 491 99.39%
the highest growth for 2008 at five percent. Outcomes and Quality
Management 348 70.45% 375 75.91% 396 80.16%
• Dictation with speech recognition: the highest growth is in In-House Transcription 397 80.36% 394 79.76% 391 79.15%
hospital segments over 200 beds in 2008. Outsourced Transcription 37 7.49% 39 7.89% 53 10.73%
• Encoder: the encoder market had the highest growth in the
0–100 bed segment. This market will have significant growth Ta ble HIm17
in upgrades sales over the next three years due to the require- 301–400 Beds 2006 2007 2008
% of 308 hospitals
ment to convert to ICD-10 coding, despite very high levels of sat- Abstracting 306 99.35% 306 99.35% 306 99.35%
uration among hospitals with 101 beds or more. Case Mix Management 279 90.58% 276 89.61% 277 89.94%
• Outcomes and quality management: the 0–300, and 501–600 bed Chart Deficiency 305 99.03% 306 99.35% 306 99.35%
segments showed the highest growth for this application. Chart Tracking/ Locator 305 99.03% 305 99.03% 305 99.03%
• In-house transcription: the bed size category that showed growth

Data Warehousing/
Mining – Clinical 75 24.35% 88 28.57% 98 31.82%
in this area was among hospitals with 0 to 100 beds. Again, the Dictation 271 87.99% 283 91.88% 286 92.86%
growth of clinical documentation applications in the segments Dictation with Speech
Recognition 52 16.88% 75 24.35% 91 29.55%
with negative growth indicators could be the reason for the Encoder 306 99.35% 308 100.00% 308 100.00%
decline in these segments. Outcomes and Quality
• Outsourced transcription: showed the best growth in the Management 218 70.78% 228 74.03% 235 76.30%
In-House Transcription 267 86.69% 259 84.09% 255 82.79%
0–300 and over 600 bed segments. Outsourced Transcription 24 7.79% 24 7.79% 25 8.12%
Ta ble HIm14
0–100 Beds 2006 2007 2008
Ta ble HIm18
% of 1,931 hospitals 401–500 Beds 2006 2007 2008
Abstracting 1,330 68.88% 1,667 86.33% 1,733 89.75% % of 179 hospitals
Case Mix Management 1,103 57.12% 1,222 63.28% 1,282 66.39% Abstracting 177 98.88% 179 100.00% 179 100.00%
Chart Deficiency 1,185 61.37% 1,430 74.05% 1,517 78.56% Case Mix Management 165 92.18% 167 93.30% 166 92.74%
Chart Tracking/ Locator 1,168 60.49% 1,368 70.84% 1,466 75.92% Chart Deficiency 179 100.00% 178 99.44% 178 99.44%
Data Warehousing/ Chart Tracking/ Locator 177 98.88% 176 98.32% 177 98.88%
Mining – Clinical 235 12.17% 281 14.55% 312 16.16% Data Warehousing/
Dictation 1,173 60.75% 1,464 75.82% 1,548 80.17% Mining – Clinical 42 23.46% 51 28.49% 61 34.08%
Dictation with Speech Dictation 163 91.06% 167 93.30% 169 94.41%
Recognition 122 6.32% 184 9.53% 218 11.29% Dictation with Speech
Encoder 1,272 65.87% 1,664 86.17% 1,725 89.33% Recognition 32 17.88% 52 29.05% 65 36.31%
Outcomes and Quality Encoder 176 98.32% 179 100.00% 179 100.00%
Management 739 38.27% 899 46.56% 969 50.18% Outcomes and Quality
In-House Transcription 1,088 56.34% 1,352 70.02% 1,429 74.00% Management 137 76.54% 143 79.89% 145 81.01%
Outsourced Transcription 71 3.68% 96 4.97% 126 6.53% In-House Transcription 151 84.36% 146 81.56% 138 77.09%
Outsourced Transcription 19 10.61% 21 11.73% 23 12.85%

Ta ble HIm19 Ta ble HIM22
501–600 Beds 2006 2007 2008 # for Contract
% of 117 hospitals 2008 Range Total % of Total
Abstracting 114 97.44% 116 99.15% 116 99.15% Chart Deficiency
Case Mix Management 98 83.76% 101 86.32% 105 89.74% Prior to 1990 122 2,570 4.75%
Chart Deficiency 114 97.44% 116 99.15% 114 97.44% 1990 to 1994 332 2,570 12.92%
Chart Tracking/ Locator 113 96.58% 114 97.44% 112 95.73% 1995 to 1999 771 2,570 30.00%
Data Warehousing/ 2000 to 2004 887 2,570 34.51%
Mining – Clinical 28 23.93% 35 29.91% 33 28.21% 2005 to 2008 458 2,570 17.82%
Dictation 107 91.45% 107 91.45% 113 96.58% Total 2,570 2,570 100.00%
Dictation with Speech Chart Tracking/Locator
Recognition 25 21.37% 40 34.19% 50 42.74% Prior to 1990 126 2,518 5.00%
Encoder 115 98.29% 116 99.15% 117 100.00% 1990 to 1994 334 2,518 13.26%
Outcomes and Quality 1995 to 1999 778 2,518 30.90%
Management 81 69.23% 84 71.79% 88 75.21%
2000 to 2004 862 2,518 34.23%
2005 to 2008 418 2,518 16.60%
Total 2,518 2,518 100.00%
Ta ble HIm20 Ta ble HIM23

600+ Beds 2006 2007 2008 # for Contract
Abstracting 140 97.90% 141 98.60% 142 99.30% Data Warehousing/Mining – Clinical
Case Mix Management 134 93.71% 135 94.41% 136 95.10% Prior to 1990 4 497 0.80%
Chart Deficiency 139 97.20% 142 99.30% 142 99.30% 1990 to 1994 95 497 19.11%
Chart Tracking/ Locator 139 97.20% 142 99.30% 142 99.30% 1995 to 1999 72 497 14.49%
Data Warehousing/ 2000 to 2004 217 497 43.66%
Mining – Clinical 48 33.57% 53 37.06% 57 39.86% 2005 to 2008 109 497 21.93%
Dictation 129 90.21% 136 95.10% 137 95.80% Total 497 497 100.00%
Dictation with Speech Dictation
Recognition 36 25.17% 50 34.97% 55 38.46% Prior to 1990 31 1,495 2.07%
Encoder 141 98.60% 143 100.00% 143 100.00% 1990 to 1994 130 1,495 8.70%
Outcomes and Quality 1995 to 1999 369 1,495 24.68%
Management 111 77.62% 119 83.22% 119 83.22%
2000 to 2004 685 1,495 45.82%
2005 to 2008 280 1,495 18.73%
Total 1,495 1,495 100.00%
The abstracting and encoder applications have the highest Ta ble HIM24
percentage of contract dates in the 1995–1999 time frame. # for Contract
The case mix, chart deficiency, chart tracking/locator, data Dictation with Speech Recognition
warehouse – clinical, dictation, outcomes and quality management, Prior to 1990 0 322 0.00%
and in-house transcription applications had the highest contracting 1990 to 1994 7 322 2.17%
rates in 2000–2004. The dictation with speech recognition, and out- 1995 to 1999 5 322 1.55%
sourced transcription applications had their highest contract rates

2000 to 2004 135 322 41.93%
2005 to 2008 175 322 54.35%
more recently – the 2005–2008 time frame (see Tables HIM21– Total 322 322 100.00%
HIM26). Encoder
Prior to 1990 271 2,200 12.32%
Ta ble HIM21 1990 to 1994 350 2,200 15.91%
# for Contract 1995 to 1999 797 2,200 36.23%
2000 to 2004 514 2,200 23.36%
Abstracting
2005 to 2008 268 2,200 12.18%
Prior to 1990 200 2,784 7.18%
Total 2,200 2,200 100.00%
1990 to 1994 392 2,784 14.08%
1995 to 1999 874 2,784 31.39% Ta ble HIM25
2000 to 2004 875 2,784 31.43% # for Contract
2005 to 2008 443 2,784 15.91% 2008 Range Total % of Total
Total 2,784 2,784 100.00% Outcomes and Quality Management
Case Mix Management Prior to 1990 43 1,609 2.67%
Prior to 1990 189 2,324 8.13% 1990 to 1994 198 1,609 12.31%
1990 to 1994 388 2,324 16.70% 1995 to 1999 476 1,609 29.58%
1995 to 1999 695 2,324 29.91% 2000 to 2004 655 1,609 40.71%
2000 to 2004 738 2,324 31.76% 2005 to 2008 237 1,609 14.73%
2005 to 2008 314 2,324 13.51% Total 1,609 1,609 100.00%
Total 2,324 2,324 100.00% In-House Transcription
Prior to 1990 50 1,651 3.03%
1990 to 1994 271 1,651 16.41%
1995 to 1999 495 1,651 29.98%
2000 to 2004 553 1,651 33.49%
2005 to 2008 282 1,651 17.08%
Total 1,651 1,651 100.00%

Ta ble HIM26 • HIPAA claims attachment regulations.
# for Contract • Severity adjusted DRG regulations.
• Outsourcing services for transcription.
Outsourced Transcription
Prior to 1990 0 86 0.00%
• Increased conversion of the medical record from paper to
1990 to 1994 4 86 4.65% a digital format; the mixed format providing some special
1995 to 1999 13 86 15.12% challenges for security and operational management, as well
2000 to 2004 28 86 32.56% as patient care challenges.
2005 to 2008 41 86 47.67%
• Increase focus on quality outcomes for participating
Total 86 86 100.00%
in outcomes-based reimbursement models (e.g., pay for
Market Drivers/Factors performance).
The HIM Department IT applications market will continue to • Increased demands from the government and payers for
be impacted through 2010 by: reporting quality and outcomes data.
• Access to capital markets required to acquire or upgrade • Continued implementation of EMR applications which may
HIM applications. make some of these applications (chart tracking and chart
• The government mandate to update coding systems to use deficiency in particular) obsolete.
ICD-10 codes by October 1, 2013.
 Document Management
The healthcare IT document management application market in Ta ble DM1 | Percentages Indicate Live and Operational, Contracted
2008 shows moderate growth for the document management and and Installations in Process
electronic forms management applications in the business office N=3,975 2006 2007 2008
and health information management (HIM) areas (see Table DM1). Document Management – Business Office 31.40% 40.45% 48.15%
Document Management – HIM 39.95% 48.91% 55.30%
The human resources area demonstrated slight growth for both Document Management – Human Resources 18.69% 21.56% 23.12%
document management and electronic forms management. This is Electronic Forms – Business Office 19.62% 25.81% 30.99%
consistent with what was observed in 2007. Electronic Forms – HIM 19.85% 28.73% 35.17%
Electronics Forms – Human Resources 13.06% 16.10% 18.42%
Ta ble Dm2 | 2008

Document Management – Business Office 6 12.77% 41 87.23% 47
Document Management – HIM 6 12.50% 42 87.50% 48
Document Management – Human Resources 3 15.00% 17 85.00% 20
Electronic Forms – Business Office 1 4.00% 24 96.00% 25
Electronic Forms – HIM 1 4.55% 21 95.45% 22
Electronics Forms – Human Resources 0 0.00% 22 100.00% 22
The majority of hospitals purchasing document management • Document management – human resources: minimal growth was
and electronic forms management applications in 2008 did so for exhibited for all segments in 2008 (see Table DM5).
the first time (see Table DM2). This is also consistent with what • Electronic forms – business office: good growth was exhibited by
we observed in 2007. all hospital segments in 2008 (see Table DM6).
• Electronic forms – HIM: good growth was exhibited by all
An evaluation of hospital market segments for document
hospital segments in 2008 (see Table DM7).
management applications in 2008 shows:
• Electronic forms – human resources: slight growth for all
• Document management – business office: good growth was
segments was exhibited in 2008 with the academic hospitals
exhibited for all hospital segments in 2008 (see Table DM3).
showing the highest growth (see Table DM8).
• Document management – HIM: good growth was exhibited
for all hospital segments in 2008 (see Table DM4).

 Document Management (con tinued)
Ta ble DM3 | Document Management – Business Office
2006 2007 2008
Academic
Not Academic 1,130 30.38% 3,719 1,467 39.45% 3,719 1,753 47.14% 3,719
Med/Surg 835 35.11% 2,378 1,058 44.49% 2,378 1,278 53.74% 2,378
Med Surg
Other 413 25.86% 1,597 550 34.44% 1,597 636 39.82% 1,597
Rural 134 14.08% 952 218 22.90% 952 281 29.52% 952
Urban
Urban 1,114 36.85% 3,023 1,390 45.98% 3,023 1,633 54.02% 3,023
All 1,248 31.40% 3,975 1,608 40.45% 3,975 1,914 48.15% 3,975
Ta ble DM4 | Document Management – HIM

2006 2007 2008
Academic
Not Academic 1,445 38.85% 3,719 1,773 47.67% 3,719 2,009 54.02% 3,719
Med/Surg 1,092 45.92% 2,378 1,312 55.17% 2,378 1,492 62.74% 2,378
Med Surg
Other 496 31.06% 1,597 632 39.57% 1,597 706 44.21% 1,597
Rural 185 19.43% 952 270 28.36% 952 335 35.19% 952
Urban
Urban 1,403 46.41% 3,023 1,674 55.38% 3,023 1,863 61.63% 3,023
All 1,588 39.95% 3,975 1,944 48.91% 3,975 2,198 55.30% 3,975
Ta ble DM5 | Document Management – Human Resources

2006 2007 2008
Academic
Not Academic 687 18.47% 3,719 795 21.38% 3,719 850 22.86% 3,719
Med/Surg 471 19.81% 2,378 542 22.79% 2,378 575 24.18% 2,378
Med Surg
Other 272 17.03% 1,597 315 19.72% 1,597 344 21.54% 1,597
Rural 93 9.77% 952 109 11.45% 952 133 13.97% 952
Urban
Urban 650 21.50% 3,023 748 24.74% 3,023 786 26.00% 3,023
All 743 18.69% 3,975 857 21.56% 3,975 919 23.12% 3,975
Ta ble DM6 | Electronic Forms – Business Office

2006 2007 2008
Academic
Not Academic 733 19.71% 3,719 960 25.81% 3,719 1,147 30.84% 3,719
Med/Surg 510 21.45% 2,378 663 27.88% 2,378 798 33.56% 2,378
Med Surg
Other 270 16.91% 1,597 363 22.73% 1,597 434 27.18% 1,597
Rural 97 10.19% 952 147 15.44% 952 196 20.59% 952
Urban
Urban 683 22.59% 3,023 879 29.08% 3,023 1,036 34.27% 3,023
All 780 19.62% 3,975 1,026 25.81% 3,975 1,232 30.99% 3,975
Ta ble DM7 | Electronic Forms – HIM

2006 2007 2008
Academic
Not Academic 734 19.74% 3,719 1,048 28.18% 3,719 1,276 34.31% 3,719
Med/Surg 505 21.24% 2,378 728 30.61% 2,378 894 37.59% 2,378
Med Surg
Other 284 17.78% 1,597 414 25.92% 1,597 504 31.56% 1,597
Rural 98 10.29% 952 160 16.81% 952 209 21.95% 952
Urban
Urban 691 22.86% 3,023 982 32.48% 3,023 1,189 39.33% 3,023
All 789 19.85% 3,975 1,142 28.73% 3,975 1,398 35.17% 3,975

Ta ble DM8 | Electronics Forms – Human Resources
2006 2007 2008
Academic
Not Academic 487 13.09% 3,719 600 16.13% 3,719 680 18.28% 3,719
Med/Surg 311 13.08% 2,378 389 16.36% 2,378 456 19.18% 2,378
Med Surg
Other 208 13.02% 1,597 251 15.72% 1,597 276 17.28% 1,597
Rural 58 6.09% 952 73 7.67% 952 91 9.56% 952
Urban
Urban 461 15.25% 3,023 567 18.76% 3,023 641 21.20% 3,023
All 519 13.06% 3,975 640 16.10% 3,975 732 18.42% 3,975
A review of the document management market in 2008 by bed Ta ble DM11

size segments provides additional insight into market saturation, 201–300 Beds 2006 2007 2008
or lack of it (see Tables FM9–FM15): % of 494 hospitals
• Document management – business office: exhibited good Document Management –
Business Office 203 41.09% 238 48.18% 281 56.88%
growth across all bed size segments. Document Management – HIM 246 49.80% 283 57.29% 319 64.57%
• Document management – HIM: displayed good growth for Document Management –
all segments except the 501–600 bed segment which had
Human Resources 107 21.66% 114 23.08% 130 26.32%
Electronic Forms –
slight growth. Business Office 108 21.86% 142 28.74% 169 34.21%
• Document management – human resources: demonstrated Electronic Forms – HIM 119 24.09% 172 34.82% 210 42.51%
slight growth for all bed segments except for the 101–200 bed Electronics Forms –
Human Resources 68 13.77% 81 16.40% 99 20.04%
segment where a slight decrease was observed.
• Electronic forms – business office: generated good growth Ta ble DM12
across all bed segments. 301–400 Beds 2006 2007 2008
• Electronic forms – HIM: experienced good growth across % of 308 hospitals
Document Management –
all segments of seven percent or more except for the 0–100 bed Business Office 136 44.16% 156 50.65% 186 60.39%
segment which indicated a growth of about five percent. Document Management – HIM 162 52.60% 195 63.31% 212 68.83%
• Electronic forms – human resources: had slight growth across Document Management –
Human Resources 70 22.73% 83 26.95% 89 28.90%
all bed segments except for the 501–600 segment which had Electronic Forms –
a slight decrease from 2007. Business Office 80 25.97% 105 34.09% 123 39.94%
Electronic Forms – HIM 79 25.65% 105 34.09% 130 42.21%
Ta ble DM9 Electronics Forms –
0–100 Beds 2006 2007 2008 Human Resources 45 14.61% 59 19.16% 62 20.13%
Document Management – Ta ble DM13
Business Office 435 22.53% 626 32.42% 753 39.00% 401–500 Beds 2006 2007 2008
Document Management – HIM 543 28.12% 727 37.65% 847 43.86% % of 179 hospitals
Document Management – Document Management –
Human Resources 274 14.19% 328 16.99% 363 18.80% Business Office 70 39.11% 88 49.16% 103 57.54%
Electronic Forms – Document Management – HIM 94 52.51% 119 66.48% 131 73.18%
Business Office 320 16.57% 430 22.27% 517 26.77% Document Management –
Electronic Forms – HIM 309 16.00% 458 23.72% 552 28.59% Human Resources 38 21.23% 48 26.82% 53 29.61%
Electronics Forms – Electronic Forms –
Ta ble DM10 Electronics Forms –
101–200 Beds 2006 2007 2008 Human Resources 27 15.08% 30 16.76% 38 21.23%
% of 803 hospitals
Document Management – Ta ble DM14
Business Office 286 35.62% 356 44.33% 432 53.80% 501–600 Beds 2006 2007 2008
Document Management – HIM 392 48.82% 447 55.67% 506 63.01% % of 117 hospitals
Document Management – Document Management –
Electronic Forms – Document Management – HIM 77 65.81% 82 70.09% 84 71.79%
Business Office 178 22.17% 227 28.27% 274 34.12% Document Management –
Electronic Forms – HIM 189 23.54% 257 32.00% 319 39.73% Human Resources 34 29.06% 38 32.48% 39 33.33%
Electronics Forms – Electronic Forms –
Electronics Forms –
Human Resources 21 17.95% 26 22.22% 25 21.37%

Ta ble DM15 Ta ble F M18
600+ Beds 2006 2007 2008 # for Contract
Document Management – Electronic Forms – HIM
Business Office 58 40.56% 79 55.24% 86 60.14% Prior to 1990 1 573 0.17%
Document Management – HIM 74 51.75% 91 63.64% 99 69.23% 1990 to 1994 19 573 3.32%
Document Management – 1995 to 1999 37 573 6.46%
Human Resources 25 17.48% 34 23.78% 37 25.87% 2000 to 2004 201 573 35.08%
Electronic Forms – 2005 to 2008 315 573 54.97%
Business Office 20 13.99% 34 23.78% 41 28.67%
Total 573 573 100.00%
Electronics Forms – HR
Electronics Forms –
Human Resources 11 7.69% 19 13.29% 24 16.78% Prior to 1990 0 208 0.00%
1990 to 1994 2 208 0.96%
A review of temporal contract signing for document management 1995 to 1999 18 208 8.65%
applications in 2008 depicts a market in which the majority of 2000 to 2004 111 208 53.37%
contracts were signed in the 2005–2008 time frame for all but the 2005 to 2008 77 208 37.02%
electronic forms – human resources application (see Tables FM16– Total 208 208 100.00%
FM18). The majority of document management applications had Market Drivers/Factors

more than half of their contracts signed in the 2005–2008 time frame, The document management IT application market has been and
with the exception of electronic forms – human resources whose will continue to be impacted through 2010 by:
highest contracting rates were in the 2000–2004 time frame. This • Lack of access to capital, which could impact the good growth
reflects a period of rapid market adoption for these applications. rates we have seen for most document management applications
Ta ble F M16 over the last two years.
# for Contract • The need to remove paper from the care delivery and operations
processes.
Document Management – Business Office
Prior to 1990 0 685 0.00%
• The need to eliminate or significantly reduce paper document
1990 to 1994 11 685 1.61% storage and filing processes.
1995 to 1999 48 685 7.01% • The need to improve access to information that is still captured
2000 to 2004 217 685 31.68% on paper documents.
• The need to improve care delivery and operational process
2005 to 2008 409 685 59.71%
Total 685 685 100.00%
Document Management – HIM
efficiency.
Prior to 1990 4 910 0.44% • The need to combine financial and clinical information.
1990 to 1994 31 910 3.41% • The need to become compliant with the HIPAA claims
1995 to 1999 55 910 6.04% attachment regulations.
• Emerging central business office requirements for document
2000 to 2004 308 910 33.85%
2005 to 2008 512 910 56.26%
Total 910 910 100.00% management solutions.
Ta ble F M17
# for Contract
Document Management – HR
Prior to 1990 2 318 0.63%
1990 to 1994 8 318 2.52%
1995 to 1999 24 318 7.55%
2000 to 2004 105 318 33.02%
2005 to 2008 179 318 56.29%
Total 318 318 100.00%
Electronic Forms – Business Office
Prior to 1990 0 428 0.00%
1990 to 1994 6 428 1.40%
1995 to 1999 30 428 7.01%
2000 to 2004 161 428 37.62%
2005 to 2008 231 428 53.97%
Total 428 428 100.00%

 Nursing IT Application Environment
In 2008, the nursing IT application market demonstrated moderate Ta ble N A1 | Percentage Includes Live and Operational, Contracted,
growth for electronic medication administration record (eMAR), and Installations in Process
and nursing documentation applications (see Table NA1). Nursing N=3,975 2006 2007 2008
acuity and nurse staffing/scheduling applications showed very EMAR 44.65% 52.45% 59.19%
slight growth. This is consistent with the growth we are seeing in

Nurse Acuity 19.67% 22.19% 23.67%
Nurse Staffing/Scheduling 59.17% 61.13% 61.84%
Stage 3 of the EMR Adoption ModelSM for 2008, which focuses on Nursing Documentation 47.40% 60.20% 67.30%
nursing IT applications in the hospital market (see the EMR Model
Adoption section in this report.
Ta ble N A 2 | 2008
EMAR 6 4.17% 138 95.83% 144
Nurse Acuity 2 8.33% 22 91.67% 24
Nurse Staffing/Scheduling 17 45.95% 20 54.05% 37
Nursing Documentation 15 22.06% 53 77.94% 68
The majority of 2008 purchasing plans for the nursing IT applica- • Nursing acuity: there was a four percent increase for academic
tion market indicate first-time purchases for eMAR, nursing acuity, hospitals from 2007 to 2008 while other hospital segments
nurse staffing/scheduling, and nursing documentation (see Table NA2). demonstrated very slight growth in 2008 (see Table NA4).
This continues the trend that was observed for these applications • Nurse staffing/scheduling: very slight growth was demonstrated
in 2007. The nurse staffing/scheduling applications are more likely across all hospital type segments in 2008. There was a slight
to be replacement purchases in the future because the product life decrease in penetration among hospitals that are part of a multi-
cycle status of these offerings will have reached its maturity. New hospital system (see Table NA5).
eMAR applications are tightly coupled with pharmacy management • Nursing documentation: all hospital type segments demonstrated
and dispensing solutions to facilitate the closed loop medication moderate growth from 2007 to 2008, but the highest segments
administration process and improve patient safety. were academic medical centers, not academic medical centers,
medical/surgical, urban, and single hospital systems which
An evaluation of hospital type market segments in 2008 shows
showed an increase of seven to eight percent (see Table NA6).
the following trends:
• eMAR: all hospital type segments demonstrated moderate growth
from 2007 to 2008, but the highest segments were academic
medical centers and medical/surgical urban, and single hospital
systems (see Table NA3).
Ta ble N A 3 | EMAR
2006 2007 2008
Academic
Not Academic 1,607 43.21% 3,719 1,900 51.09% 3,719 2,147 57.73% 3,719
Med/Surg 1,221 51.35% 2,378 1,381 58.07% 2,378 1,570 66.02% 2,378
Med Surg
Other 554 34.69% 1,597 704 44.08% 1,597 783 49.03% 1,597
Rural 195 20.48% 952 285 29.94% 952 337 35.40% 952
Urban
Urban 1,580 52.27% 3,023 1,800 59.54% 3,023 2,016 66.69% 3,023
All 1,775 44.65% 3,975 2,085 52.45% 3,975 2,353 59.19% 3,975
Ta ble N A 4 | Nurse Acuity

2006 2007 2008
Academic
Not Academic 706 18.98% 3,719 799 21.48% 3,719 848 22.80% 3,719
Med/Surg 499 20.98% 2,378 571 24.01% 2,378 614 25.82% 2,378
Med Surg
Other 283 17.72% 1,597 311 19.47% 1,597 327 20.48% 1,597
Rural 69 7.25% 952 87 9.14% 952 91 9.56% 952
Urban
Urban 713 23.59% 3,023 795 26.30% 3,023 850 28.12% 3,023
All 782 19.67% 3,975 882 22.19% 3,975 941 23.67% 3,975

 Nursing IT Application Environment (con tinue d)
Ta ble N A5 | Nurse Staffing/Scheduling
2006 2007 2008
Academic
Not Academic 2,127 57.19% 3,719 2,198 59.10% 3,719 2,226 59.85% 3,719
Med/Surg 1,720 72.33% 2,378 1,737 73.04% 2,378 1,749 73.55% 2,378
Med Surg
Other 632 39.57% 1,597 693 43.39% 1,597 709 44.40% 1,597
Rural 234 24.58% 952 292 30.67% 952 300 31.51% 952
Urban
Urban 2,118 70.06% 3,023 2,138 70.72% 3,023 2,158 71.39% 3,023
All 2,352 59.17% 3,975 2,430 61.13% 3,975 2,458 61.84% 3,975
Ta ble N A6 | Nursing Documentation

2006 2007 2008
Academic
Not Academic 1,726 46.41% 3,719 2,201 59.18% 3,719 2,462 66.20% 3,719
Med/Surg 1,304 54.84% 2,378 1,583 66.57% 2,378 1,769 74.39% 2,378
Med Surg
Other 580 36.32% 1,597 810 50.72% 1,597 906 56.73% 1,597
Rural 217 22.79% 952 365 38.34% 952 427 44.85% 952
Urban
Urban 1,667 55.14% 3,023 2,028 67.09% 3,023 2,248 74.36% 3,023
All 1,884 47.40% 3,975 2,393 60.20% 3,975 2,675 67.30% 3,975
The analysis of this market by bed size activity from 2007 to 2008 application were in the 301–400, and over 600 bed segments
provided the following observations (see Tables NA7–NA13): which indicated an increase of almost three percent.
• eMAR: demonstrated good growth for the 0–500 and over • Nurse staffing/scheduling: this segment also showed little,
600 bed segments. if any, growth across all bed size segments in 2008.
• Nurse acuity: very little if any growth was demonstrated in • Nursing documentation: demonstrated good growth across
all bed segments, but the highest growth segments for this all hospital bed size segments in 2008.
Ta ble N A7 Ta ble N A11
0–100 Beds 2006 2007 2008 401–500 Beds 2006 2007 2008
EMAR 597 30.92% 786 40.70% 890 46.09% EMAR 116 64.80% 125 69.83% 144 80.45%
Nurse Acuity 271 14.03% 292 15.12% 311 16.11% Nurse Acuity 56 31.28% 69 38.55% 70 39.11%
Nurse Staffing/Scheduling 703 36.41% 762 39.46% 780 40.39% Nurse Staffing/Scheduling 165 92.18% 164 91.62% 163 91.06%
Nursing Documentation 646 33.45% 942 48.78% 1,062 55.00% Nursing Documentation 113 63.13% 135 75.42% 145 81.01%
Ta ble N A 8 Ta ble N A12

101–200 Beds 2006 2007 2008 501–600 Beds 2006 2007 2008
EMAR 401 49.94% 453 56.41% 524 65.26% EMAR 90 76.92% 100 85.47% 100 85.47%
Nursing Documentation 459 57.16% 543 67.62% 613 76.34% Nursing Documentation 83 70.94% 96 82.05% 105 89.74%

201–300 Beds 2006 2007 2008 600+ Beds 2006 2007 2008
EMAR 275 55.67% 305 61.74% 348 70.45% EMAR 93 65.03% 94 65.73% 109 76.22%
Nursing Documentation 298 60.32% 346 70.04% 386 78.14% Nursing Documentation 90 62.94% 108 75.52% 118 82.52%
Ta ble N A10
301–400 Beds 2006 2007 2008
% of 308 hospitals
EMAR 203 65.91% 222 72.08% 238 77.27%
Nurse Acuity 78 25.32% 79 25.65% 89 28.90%
Nurse Staffing/Scheduling 259 84.09% 260 84.42% 261 84.74%
Nursing Documentation 195 63.31% 223 72.40% 246 79.87%

 Nursing IT Application Environment (con tinued)
# for Contract # for Contract
2008 Range Total % of Total 2008 Range Total % of Total
EMAR Nurse Staffing/Scheduling
Prior to 1990 2 1,577 0.13% Prior to 1990 148 1,462 10.12%
1990 to 1994 95 1,577 6.02% 1990 to 1994 157 1,462 10.74%
1995 to 1999 66 1,577 4.19% 1995 to 1999 331 1,462 22.64%
2000 to 2004 703 1,577 44.58% 2000 to 2004 420 1,462 28.73%
2005 to 2008 711 1,577 45.09% 2005 to 2008 406 1,462 27.77%
Total 1,577 1,577 100.00% Total 1,462 1,462 100.00%
Nurse Acuity Nursing Documentation
Prior to 1990 15 595 2.52% Prior to 1990 17 1,698 1.00%
1990 to 1994 27 595 4.54% 1990 to 1994 148 1,698 8.72%
1995 to 1999 89 595 14.96% 1995 to 1999 211 1,698 12.43%
2000 to 2004 265 595 44.54% 2000 to 2004 684 1,698 40.28%
2005 to 2008 199 595 33.45% 2005 to 2008 638 1,698 37.57%
Total 595 595 100.00% Total 1,698 1,698 100.00%
An evaluation of the contract purchasing time frames for these Market Drivers/Factors
nursing applications reflects the highest numbers of contracts The nursing application IT application market has been and will
were closed between 2000 and 2004 for nurse acuity and nursing continue to be impacted through 2010 by:
documentation. The number of eMAR contracts signed between • Lack of access to capital for purchasing nursing IT solutions.
2005 and 2008 exceeded the contracting for the applications from • The need to improve patient safety and eliminate medical errors.
2000 to 2004 (see Tables NA14 and NA15). Contract signing for • The need to improve, and be able to report on, quality outcomes.
nurse scheduling/staffing has been consistent since 1995. If the cur- • The need to create an effective support foundation for computer-
rent recession does not impact current growth rates for these appli- ized practitioner order entry (CPOE).
cations, the 2005–2009 timeframe will become the highest • The need to effectively staff nurses to help reduce the impact
contracting period for all nursing IT applications. of the nursing shortage.
• The need to transform patient care delivery processes to
reduce costs and improve operational efficiency.
• The continued deployment of nursing systems as a nurse
satisfier and a recruitment / retention aid.
 Ancillary Department Environment

In 2008, the ancillary department application system environment laboratory systems is being driven by the need for laboratories to
demonstrated the highest growth for emergency department (ED), function as both hospital laboratories and reference laboratories
respiratory and obstetrical systems. The older legacy environments for their local and/or regional markets. High volumes of molecular
for laboratory information systems, pharmacy management systems, biologic testing (e.g., genetic and proteomic testing) may also
and radiology information systems are continuing to approach induce laboratories to evaluate replacing their current systems
market saturation (see Table AD1). if current vendors do not support these testing environments.
Purchasing plans for this market in 2008 reflects the majority Ta ble A D1 | Percentages Represent Live and Operational, Contracted
of purchases for cardiology, ED, intensive care, respiratory, and and Installations in Process
obstetrical systems to be first-time purchases. The majority of labora- N=3,975 2006 2007 2008
Cardiology Information System 34.64% 39.45% 42.19%
tory, pharmacy, and radiology system purchases continue to be Emergency Department System 57.99% 64.43% 68.68%
replacement purchases (see Table AD2). CPOE and the requirement Intensive Care 40.33% 44.65% 47.22%
for a tight data coupling with pharmacy systems continues Laboratory Information System 83.42% 94.49% 96.10%
to drive pharmacy system replacement, while the integration Obstetrical Systems (Labor & Delivery) 35.19% 42.01% 45.46%
requirements between radiology PACS and radiology systems is Pharmacy Management System 81.58% 91.77% 92.78%
Radiology Information System 76.40% 88.20% 90.79%
driving the high levels of replacement purchases for radiology Respiratory Care Information System 24.93% 29.69% 33.69%
information systems. We believe the replacement purchases for

 Ancillary Department Environment (con tinue d)
Ta ble A D2 | 2008
Cardiology Information System 7 31.82% 15 68.18% 22
Emergency Department System 19 42.22% 26 57.78% 45
Intensive Care 10 41.67% 14 58.33% 24
Laboratory Information System 34 82.93% 7 17.07% 41
Obstetrical Systems (Labor & Delivery) 7 36.84% 12 63.16% 19
Pharmacy Management System 37 72.55% 14 27.45% 51
Radiology Information System 32 57.14% 24 42.86% 56
Respiratory Care Information System 7 43.75% 9 56.25% 16
An evaluation of hospital type market segments for ancillary • Laboratory information systems: non-medical/surgical hospitals,
department systems from 2007 to 2008 shows the highest growth rural, and single hospitals (see Table AD6).
in the following: • Obstetrical systems: academic medical centers, medical/surgical,
• Cardiology information systems: academic medical centers, urban, and single hospital systems (see Table AD7).
medical/surgical, both single and multi-hospital systems and • Pharmacy management systems: other non-medical/surgical
urban (see Table AD3). hospitals and rural hospitals (see Table AD8).
• Emergency department information systems: not academic, • Radiology information systems: other non-medical/surgical hospitals,
medical/surgical, rural, urban and single hospitals (see Table AD4). rural hospitals, and single hospital systems (see Table AD9).
• Intensive care systems: academic medical centers, medical/ • Respiratory care information systems: academic medical centers;
surgical, urban and single hospitals (see Table AD5). not academic medical centers, medical/surgical, urban, and
single hospital systems (see Table AD10).
Ta ble A D3 | Cardiology Information System

2006 2007 2008
Academic
Not Academic 1,215 32.67% 3,719 1,381 37.13% 3,719 1,478 39.74% 3,719
Med/Surg 1,090 45.84% 2,378 1,240 52.14% 2,378 1,328 55.85% 2,378
Med Surg
Other 287 17.97% 1,597 328 20.54% 1,597 349 21.85% 1,597
Rural 74 7.77% 952 90 9.45% 952 85 8.93% 952
Urban
Urban 1,303 43.10% 3,023 1,478 48.89% 3,023 1,592 52.66% 3,023
All 1,377 34.64% 3,975 1,568 39.45% 3,975 1,677 42.19% 3,975
Ta ble A D 4 | Emergency Deparment Systems

2006 2007 2008
Academic
Not Academic 2,099 56.44% 3,719 2,337 62.84% 3,719 2,501 67.25% 3,719
Med/Surg 1,721 72.37% 2,378 1,851 77.84% 2,378 1,955 82.21% 2,378
Med Surg
Other 584 36.57% 1,597 710 44.46% 1,597 775 48.53% 1,597
Rural 282 29.62% 952 377 39.60% 952 426 44.75% 952
Urban
Urban 2,023 66.92% 3,023 2,184 72.25% 3,023 2,304 76.22% 3,023
All 2,305 57.99% 3,975 2,561 64.43% 3,975 2,730 68.68% 3,975
Ta ble A D5 | Intensive Care

2006 2007 2008
Academic
Not Academic 1,451 39.02% 3,719 1,607 43.21% 3,719 1,700 45.71% 3,719
Med/Surg 1,118 47.01% 2,378 1,213 51.01% 2,378 1,289 54.21% 2,378
Med Surg
Other 485 30.37% 1,597 562 35.19% 1,597 579 36.26% 1,597
Rural 157 16.49% 952 204 21.43% 952 214 22.48% 952
Urban
Urban 1,446 47.83% 3,023 1,571 51.97% 3,023 1,663 55.01% 3,023
All 1,603 40.33% 3,975 1,775 44.65% 3,975 1,877 47.22% 3,975

 Ancillary Department Environment (con tinued)
Ta ble A D6 | Laboratory Information System
2006 2007 2008
Academic
Not Academic 3,069 82.52% 3,719 3,500 94.11% 3,719 3,564 95.83% 3,719
Med/Surg 2,225 93.57% 2,378 2,348 98.74% 2,378 2,366 99.50% 2,378
Med Surg
Other 1,091 68.32% 1,597 1,408 88.17% 1,597 1,454 91.05% 1,597
Rural 547 57.46% 952 807 84.77% 952 849 89.18% 952
Urban
Urban 2,769 91.60% 3,023 2,949 97.55% 3,023 2,971 98.28% 3,023
All 3,316 83.42% 3,975 3,756 94.49% 3,975 3,820 96.10% 3,975
Ta ble A D7 | Obstetrical Systems (Labor & Delivery)

2006 2007 2008
Academic
Not Academic 1,255 33.75% 3,719 1,499 40.31% 3,719 1,624 43.67% 3,719
Med/Surg 1,098 46.17% 2,378 1,269 53.36% 2,378 1,387 58.33% 2,378
Med Surg
Other 301 18.85% 1,597 401 25.11% 1,597 420 26.30% 1,597
Rural 129 13.55% 952 176 18.49% 952 186 19.54% 952
Urban
Urban 1,270 42.01% 3,023 1,494 49.42% 3,023 1,621 53.62% 3,023
All 1,399 35.19% 3,975 1,670 42.01% 3,975 1,807 45.46% 3,975
Ta ble A D8 | Pharmacy Management System

2006 2007 2008
Academic
Not Academic 2,988 80.34% 3,719 3,365 90.48% 3,719 3,432 92.28% 3,719
Med/Surg 2,229 93.73% 2,378 2,336 98.23% 2,378 2,359 99.20% 2,378
Med Surg
Other 1,014 63.49% 1,597 1,285 80.46% 1,597 1,329 83.22% 1,597
Rural 488 51.26% 952 702 73.74% 952 734 77.10% 952
Urban
Urban 2,755 91.13% 3,023 2,919 96.56% 3,023 2,954 97.72% 3,023
All 3,243 81.58% 3,975 3,648 91.77% 3,975 3,688 92.78% 3,975
Ta ble A D9 | Radiology Information System

2006 2007 2008
Academic
Not Academic 2,785 74.89% 3,719 3,253 87.47% 3,719 3,357 90.27% 3,719
Med/Surg 2,137 89.87% 2,378 2,289 96.26% 2,378 2,311 97.18% 2,378
Med Surg
Other 900 56.36% 1,597 1,217 76.21% 1,597 1,298 81.28% 1,597
Rural 413 43.38% 952 646 67.86% 952 705 74.05% 952
Urban
Urban 2,624 86.80% 3,023 2,860 94.61% 3,023 2,904 96.06% 3,023
All 3,037 76.40% 3,975 3,506 88.20% 3,975 3,609 90.79% 3,975
Ta ble A D10 | Respiratory Care Information System

2006 2007 2008
Academic
Not Academic 895 24.07% 3,719 1,065 28.64% 3,719 1,212 32.59% 3,719
Med/Surg 652 27.42% 2,378 791 33.26% 2,378 903 37.97% 2,378
Med Surg
Other 339 21.23% 1,597 389 24.36% 1,597 436 27.30% 1,597
Rural 111 11.66% 952 143 15.02% 952 172 18.07% 952
Urban
Urban 880 29.11% 3,023 1,037 34.30% 3,023 1,167 38.60% 3,023
All 991 24.93% 3,975 1,180 29.69% 3,975 1,339 33.69% 3,975

 Ancillary Department Environment (con tinue d)
The analysis of the ancillary market by bed size from 2007–2008 Ta ble A D14
is exhibited in Tables AD11–AD17 and depicts the following as 301–400 Beds 2006 2007 2008
the highest growth segments by application: % of 308 hospitals
• Cardiology information systems: 101–500 beds and over Cardiology Information System 177 57.47% 216 70.13% 232 75.32%
600 bed segments.

Emergency Department System 235 76.30% 250 81.17% 259 84.09%
Intensive Care 173 56.17% 175 56.82% 185 60.06%
• Emergency department information systems: 0–100 bed Laboratory Information System 307 99.68% 308 100.00% 308 100.00%
segment had a growth of almost five percent. Obstetrical Systems
• Intensive care systems: 401–600 bed segments. (Labor & Delivery) 187 60.71% 207 67.21% 224 72.73%
Pharmacy Management System 308 100.00% 308 100.00% 308 100.00%
• Laboratory information systems: very slight growth for Radiology Information System 303 98.38% 304 98.70% 304 98.70%
0–100 bed segments, and total market saturation in all Respiratory Care Information
other bed segments. System 98 31.82% 112 36.36% 131 42.53%
• Obstetrical systems: 101–500 bed and over 600 bed segments. Ta ble A D15
• Pharmacy management systems: very slight growth for the 401–500 Beds 2006 2007 2008
0–100 bed segments, and total market saturation in the % of 179 hospitals
101–over 600 bed segments. Cardiology Information System 129 72.07% 139 77.65% 154 86.03%
• Radiology information systems: 0–100 bed segment shows Emergency Department System 135 75.42% 144 80.45% 151 84.36%
the highest growth, and the 501–600 bed market has complete Intensive Care 99 55.31% 111 62.01% 120 67.04%
Laboratory Information System 177 98.88% 179 100.00% 179 100.00%
saturation. Obstetrical Systems
• Respiratory care information system: 101–500 bed segments (Labor & Delivery) 101 56.42% 122 68.16% 135 75.42%
had the highest growth from 2007 to 2008. Pharmacy Management System 178 99.44% 179 100.00% 179 100.00%
Radiology Information System 178 99.44% 178 99.44% 178 99.44%
Ta ble A D11 Respiratory Care Information
System 57 31.84% 69 38.55% 81 45.25%
0–100 Beds 2006 2007 2008
Ta ble A D16
Cardiology Information System 254 13.15% 278 14.40% 287 14.86%
501–600 Beds 2006 2007 2008
Intensive Care 517 26.77% 602 31.18% 631 32.68% % of 117 hospitals
Laboratory Information System 1,288 66.70% 1,715 88.81% 1,777 92.02% Cardiology Information System 89 76.07% 95 81.20% 97 82.91%
Obstetrical Systems Emergency Department System 98 83.76% 106 90.60% 108 92.31%
(Labor & Delivery) 347 17.97% 461 23.87% 493 25.53% Intensive Care 70 59.83% 78 66.67% 84 71.79%
Pharmacy Management System 1,218 63.08% 1,585 82.08% 1,649 85.40% Laboratory Information System 116 99.15% 117 100.00% 117 100.00%
Radiology Information System 1,065 55.15% 1,498 77.58% 1,599 82.81% Obstetrical Systems
Respiratory Care Information (Labor & Delivery) 70 59.83% 85 72.65% 88 75.21%
System 349 18.07% 409 21.18% 479 24.81% Pharmacy Management System 117 100.00% 117 100.00% 117 100.00%
System 40 34.19% 53 45.30% 55 47.01%
101–200 Beds 2006 2007 2008
% of 803 hospitals
Ta ble A D17
600+ Beds 2006 2007 2008
Intensive Care 390 48.57% 425 52.93% 450 56.04% % of 143 hospitals
Laboratory Information System 792 98.63% 801 99.75% 802 99.88% Cardiology Information System 101 70.63% 116 81.12% 126 88.11%
Obstetrical Systems Emergency Department System 118 82.52% 125 87.41% 128 89.51%
(Labor & Delivery) 359 44.71% 426 53.05% 463 57.66% Intensive Care 89 62.24% 96 67.13% 100 69.93%
Pharmacy Management System 787 98.01% 798 99.38% 800 99.63% Laboratory Information System 143 100.00% 143 100.00% 143 100.00%
Radiology Information System 756 94.15% 778 96.89% 780 97.14% Obstetrical Systems
Respiratory Care Information (Labor & Delivery) 86 60.14% 101 70.63% 107 74.83%
System 235 29.27% 285 35.49% 315 39.23% Pharmacy Management System 142 99.30% 143 100.00% 143 100.00%
System 55 38.46% 68 47.55% 73 51.05%
201–300 Beds 2006 2007 2008
% of 494 hospitals
Intensive Care 265 53.64% 288 58.30% 307 62.15%
Laboratory Information System 493 99.80% 493 99.80% 494 100.00%
Obstetrical Systems
(Labor & Delivery) 249 50.40% 268 54.25% 297 60.12%
Pharmacy Management System 493 99.80% 491 99.39% 492 99.60%
Respiratory Care Information
System 157 31.78% 184 37.25% 205 41.50%

 Ancillary Department Environment (con tinued)
An evaluation of contract purchasing time frames for ancillary Ta ble A D21
department applications shows the heaviest buying of all applica- # for Contract
tions between 2000 and 2004 (see Tables AD18–AD21). Ancillary 2008 Range Total % of Total
Radiology Information System
department systems contracted before 1995 will have the highest Prior to 1990 97 2,574 3.77%
probability for replacement purchases through 2011. 1990 to 1994 219 2,574 8.51%
1995 to 1999 525 2,574 20.40%
Ta ble A D18
2000 to 2004 1,047 2,574 40.68%
# for Contract
2008 Range Total % of Total 2005 to 2008 686 2,574 26.65%
Cardiology Information System Total 2,574 2,574 100.00%
Prior to 1990 5 744 0.67% Respiratory Care Information System
1990 to 1994 28 744 3.76% Prior to 1990 14 796 1.76%
1995 to 1999 86 744 11.56% 1990 to 1994 132 796 16.58%
2000 to 2004 373 744 50.13% 1995 to 1999 148 796 18.59%
2005 to 2008 252 744 33.87% 2000 to 2004 293 796 36.81%
Total 744 744 100.00% 2005 to 2008 209 796 26.26%
Emergency Department System Total 796 796 100.00%
Prior to 1990 20 1,722 1.16%
1990 to 1994 67 1,722 3.89%
1995 to 1999 311 1,722 18.06% The ancillary department IT application market has been and
2000 to 2004 816 1,722 47.39% will continue to be impacted through 2010 by:
2005 to 2008 508 1,722 29.50% • Hospitals’ access to capital which may impact purchases of
Total 1,722 1,722 100.00%
these solutions through at least 2010.
Ta ble A D19 • The continued hospital focus on gathering data related to
# for Contract quality of care.
• The need to reduce or eliminate medical and medication errors.
Intensive Care
Prior to 1990 17 1,269 1.34%
• The need to create improved data sharing/integration between
1990 to 1994 151 1,269 11.90% clinical and financial systems to support HIPAA claims
1995 to 1999 205 1,269 16.15% attachment regulations.
2000 to 2004 579 1,269 45.63% • The need to capture more clinical data electronically to support
2005 to 2008 317 1,269 24.98%
healthcare information exchange and personal health record
Total 1,269 1,269 100.00%
Laboratory Information System
initiatives.
Prior to 1990 181 2,617 6.92% • The push by the government to improve the capture, manage-
1990 to 1994 366 2,617 13.99% ment, and sharing of electronic health information between
1995 to 1999 660 2,617 25.22% all healthcare stakeholders.
2000 to 2004 887 2,617 33.89%
• The push by the government for pay-for-performance and the
2005 to 2008 523 2,617 19.98%
Total 2,617 2,617 100.00%
need of hospitals to have discrete data with which to report.
• The need to have CPOE systems tightly coupled with pharmacy
Ta ble A D20 systems.
2008
# for Contract
Range Total % of Total
• The need to have pharmacy systems tightly coupled with
Obstetrical Systems (Labor & Delivery) electronic medication administration record systems.
Prior to 1990 4 806 0.50% • The need to have radiology information systems tightly
1990 to 1994 46 806 5.71% coupled with PACS systems.
1995 to 1999 128 806 15.88%
• Complex molecular and genetic testing in laboratories.
2000 to 2004 395 806 49.01%
2005 to 2008 233 806 28.91%
Total 806 806 100.00%
Pharmacy Management System
Prior to 1990 85 2,741 3.10%
1990 to 1994 343 2,741 12.51%
1995 to 1999 521 2,741 19.01%
2000 to 2004 1,183 2,741 43.16%
2005 to 2008 609 2,741 22.22%
Total 2,741 2,741 100.00%

 Operating Room (Surgery)
The operating room (OR – surgery) IT application market for U.S. • Post-operative: growth was strong among all categories with the
hospitals in 2008 showed moderate growth for OR scheduling systems, exception of rural and other hospitals, which showed a growth
peri-operative systems, and post-operative systems (see Table OR1). of two percent or less (see Table OR4).
Pre-operative systems experienced slight growth in 2008. • Pre-operative: the only significant growth appeared in the single
Purchasing plans for this market in 2008 were split equally hospital market for this application (see Table OR5).
between applications that had more first-time acquisitions and • OR scheduling: not academic, medical/surgical, urban, and
applications that had more replacement purchases. Peri-operative single hospitals showed the best growth for this application in
and post-operative applications had more first-time purchases, 2008 (see Table OR6).
and pre-operative and operating room (OR) scheduling had more Ta ble OR1 | Percentages Include Live and Operational, Contracted,
replacement purchases (see Table OR2). and Installations in Process
N=3,975 2006 2007 2008
An evaluation of hospital type market segments in 2008 demon- Peri-Operative 49.48% 52.18% 56.73%
strates the highest growth by application: Post-Operative 47.87% 52.81% 57.36%
• Peri-operative: medical/surgical, urban, not academic and both sin- Pre-Operative 61.89% 62.94% 63.90%
gle and multi-hospitals had the highest growth (see Table OR3). OR Scheduling 50.34% 59.90% 64.35%
Ta ble OR 2 | 2008
Peri-Operative 17 40.48% 25 59.52% 42
Post-Operative 17 44.74% 21 55.26% 38
Pre-Operative 22 56.41% 17 43.59% 39
OR Scheduling 23 56.10% 18 43.90% 41
Ta ble or3 | Peri-Operative

2006 2007 2008
Academic
Not Academic 1,773 47.67% 3,719 1,866 50.17% 3,719 2,040 54.85% 3,719
Med/Surg 1,459 61.35% 2,378 1,524 64.09% 2,378 1,671 70.27% 2,378
Med Surg
Other 508 31.81% 1,597 550 34.44% 1,597 584 36.57% 1,597
Rural 193 20.27% 952 222 23.32% 952 234 24.58% 952
Urban
Urban 1,774 58.68% 3,023 1,852 61.26% 3,023 2,021 66.85% 3,023
All 1,967 49.48% 3,975 2,074 52.18% 3,975 2,255 56.73% 3,975
Ta ble or4 | Post-Operative

2006 2007 2008
Academic
Not Academic 1,719 46.22% 3,719 1,901 51.12% 3,719 2,070 55.66% 3,719
Med/Surg 1,406 59.13% 2,378 1,535 64.55% 2,378 1,678 70.56% 2,378
Med Surg
Other 497 31.12% 1,597 564 35.32% 1,597 602 37.70% 1,597
Rural 195 20.48% 952 245 25.74% 952 256 26.89% 952
Urban
Urban 1,708 56.50% 3,023 1,854 61.33% 3,023 2,024 66.95% 3,023
All 1,903 47.87% 3,975 2,099 52.81% 3,975 2,280 57.36% 3,975
Ta ble or5 | Pre-Operative

2006 2007 2008
Academic
Not Academic 2,223 59.77% 3,719 2,267 60.96% 3,719 2,302 61.90% 3,719
Med/Surg 1,837 77.25% 2,378 1,843 77.50% 2,378 1,872 78.72% 2,378
Med Surg
Other 623 39.01% 1,597 659 41.26% 1,597 668 41.83% 1,597
Rural 256 26.89% 952 291 30.57% 952 291 30.57% 952
Urban
Urban 2,204 72.91% 3,023 2,211 73.14% 3,023 2,249 74.40% 3,023
All 2,460 61.89% 3,975 2,502 62.94% 3,975 2,540 63.90% 3,975

 Operating Room (Surgery) (con tinued)
Ta ble or6 | OR Scheduling
2006 2007 2008
Academic
Not Academic 1,806 48.56% 3,719 2,153 57.89% 3,719 2,323 62.46% 3,719
Med/Surg 1,526 64.17% 2,378 1,738 73.09% 2,378 1,874 78.81% 2,378
Med Surg
Other 475 29.74% 1,597 643 40.26% 1,597 684 42.83% 1,597
Rural 169 17.75% 952 263 27.63% 952 283 29.73% 952
Urban
Urban 1,832 60.60% 3,023 2,118 70.06% 3,023 2,275 75.26% 3,023
All 2,001 50.34% 3,975 2,381 59.90% 3,975 2,558 64.35% 3,975
The analysis of the OR market by bed size in 2008 demonstrated Ta ble or11
the following (see Tables OR7–OR13): 401–500 Beds 2006 2007 2008
• Peri-operative: all bed segments except the 501–600 segment % of 179 hospitals
showed moderate growth in 2008. Peri-Operative 129 72.07% 136 75.98% 143 79.89%
• Post-operative: all segments except the 0–100 segment showed

Post-Operative 122 68.16% 136 75.98% 144 80.45%
Pre-Operative 163 91.06% 163 91.06% 164 91.62%
moderate growth in 2008. OR Scheduling 143 79.89% 159 88.83% 167 93.30%
• Pre-operative: showed only very slight growth across all bed seg-
ments in 2008. The 600+ bed segment is the only group Ta ble or12
to show a decrease. 501–600 Beds 2006 2007 2008
• OR scheduling: showed the highest growth in the 101–300 bed % of 117 hospitals
Peri-Operative 91 77.78% 99 84.62% 102 87.18%
segments. The other bed segments indicated moderate growth, Post-Operative 82 70.09% 94 80.34% 99 84.62%
with the exception of the 501 to 600 bed segment. Pre-Operative 112 95.73% 110 94.02% 111 94.87%
OR Scheduling 97 82.91% 110 94.02% 110 94.02%
Ta ble or7
0–100 Beds 2006 2007 2008 Ta ble or13
600+ Beds 2006 2007 2008
Peri-Operative 574 29.73% 619 32.06% 680 35.21%
% of 143 hospitals
Post-Operative 574 29.73% 649 33.61% 701 36.30%
Peri-Operative 117 81.82% 118 82.52% 125 87.41%
Pre-Operative 712 36.87% 763 39.51% 783 40.55%
Post-Operative 112 78.32% 116 81.12% 122 85.31%
OR Scheduling 521 26.98% 717 37.13% 785 40.65%
Pre-Operative 132 92.31% 129 90.21% 128 89.51%
OR Scheduling 110 76.92% 122 85.31% 128 89.51%
Ta ble or8
101–200 Beds 2006 2007 2008
Evaluating the contract purchasing timeframes that include
% of 803 hospitals
Peri-Operative 496 61.77% 514 64.01% 574 71.48%
2008 data, the majority of purchases took place in the 2000–2004
Post-Operative 476 59.28% 522 65.01% 581 72.35% period across all OR applications. The market has also shown
Pre-Operative 632 78.70% 632 78.70% 646 80.45% good contracting activity for the OR applications in the 2005–2008
OR Scheduling 533 66.38% 605 75.34% 657 81.82% timeframe.
Ta ble or9 Ta ble or14
201–300 Beds 2006 2007 2008 # for Contract
% of 494 hospitals
Peri-Operative 331 67.00% 354 71.66% 383 77.53% Peri-Operative
Post-Operative 320 64.78% 355 71.86% 381 77.13% Prior to 1990 16 1,351 1.18%
Pre-Operative 427 86.44% 432 87.45% 433 87.65% 1990 to 1994 57 1,351 4.22%
OR Scheduling 356 72.06% 397 80.36% 428 86.64% 1995 to 1999 209 1,351 15.47%
2000 to 2004 645 1,351 47.74%
Ta ble or10 2005 to 2008 424 1,351 31.38%
Total 1,351 1,351 100.00%
301–400 Beds 2006 2007 2008
Post-Operative
% of 308 hospitals
Prior to 1990 12 1,372 0.87%
Peri-Operative 229 74.35% 234 75.97% 248 80.52%
1990 to 1994 61 1,372 4.45%
Post-Operative 217 70.45% 227 73.70% 252 81.82%
1995 to 1999 206 1,372 15.01%
Pre-Operative 282 91.56% 273 88.64% 275 89.29%
2000 to 2004 658 1,372 47.96%
OR Scheduling 241 78.25% 271 87.99% 283 91.88%
2005 to 2008 435 1,372 31.71%
Total 1,372 1,372 100.00%

 Operating Room (Surgery) (con tinue d)
Ta ble or15 Market Drivers/Factors
# for Contract The OR IT application market for U.S. hospitals has been and
2008 Range Total % of Total will continue to be impacted through 2010 by:
Pre-Operative
• Lack of access to capital which may slow this market through
Prior to 1990 45 1,750 2.57%
1990 to 1994 112 1,750 6.40%
at least 2010.
1995 to 1999 347 1,750 19.83% • An increased need to track and report quality outcomes.
2000 to 2004 807 1,750 46.11% • A continuing focus on reducing medical and medication errors at
2005 to 2008 439 1,750 25.09% point of care and during surgery procedures.
Total 1,750 1,750 100.00% • An increased need to capture, share, manage, and analyze
OR Scheduling OR data to improve processes and drive down costs.
• The increased focus of the federal government to improve data
Prior to 1990 25 1,527 1.64%
1990 to 1994 72 1,527 4.72%
1995 to 1999 244 1,527 15.98% sharing across modalities of care and among all care providers.
2000 to 2004 692 1,527 45.32% • An increased consumer demand to access and evaluate hospital
2005 to 2008 494 1,527 32.35% service performance indicators.
Total 1,527 1,527 100.00% • The emergence of surgical joint ventures services that will
decentralize OR operations in hospitals.
 Ambulatory (Hospital Owned or Managed) IT Environment

The hospital-owned/managed ambulatory IT market shows good predominately a first-time purchase market for 2008. We believe the
growth for ambulatory electronic medical record (EMR) and ambula- ambulatory EMR market will move toward a replacement selling
tory (picture archiving and communication systems) PACS, and almost market over the next three years as more hospitals move toward EMR
full saturation for practice management systems. The ambulatory solutions that have the same architecture as the practice management
PACS market in 2008 was about half of what the growth was in 2007. applications (and if possible, integration or interfaces to their acute care
Ambulatory laboratory and pharmacy application systems show slight EMR systems). This will also catalyze the consolidation of the vendors
declines from 2007 to 2008, while the radiology market was relatively for the ambulatory solutions in many cases over the next five years.
flat (see Table AH1). We believe that the focus by the executive branch An evaluation of market segments (HIMSS Analytics tracks only
of the government on physician adoption of ambulatory EMRs resulted urban/rural and ownership/management of the ambulatory facility
in the relaxation of the Stark Laws that drove some of the growth in the by a multi/single hospital system for ambulatory facilities) provides
ambulatory EMR market in 2008. But the economy and the concern for the following market insights for 2009:
capital in the latter part of 2008 may have impacted the strategies of • Ambulatory EMR had good growth in urban and single hospital
hospitals to extend EMRs to affiliated physician groups. sections segments (see Table AH3).
Purchasing plans for the hospital-owned ambulatory market in 2008 • Ambulatory laboratory demonstrated slight growth the single
show the majority of purchases as replacement purchases for practice hospital segment and declines for all of the other segments
management applications, while first-time acquisitions predominate for (see Table AH4).
pharmacy (see Table AH2). Purchasing for ambulatory EMRs was a • Ambulatory PACS had the highest growth in the rural and multi-
hospital segments and good growth for all segments (see Table AH5).
Ta ble ah1 | Percentages for Live and Operational, Contracted, and • Ambulatory pharmacy had the highest growth in the single
Installation in Process hospital segments and all other segments demonstrated declining
N= 15,146* 2006 2007 2008 market share (see Table AH6).
• Ambulatory radiology showed very slight growth in the urban
Ambulatory EMR 37.50% 45.17% 49.58%
Ambulatory Laboratory 37.50% 15.36% 15.05%
Ambulatory PACS* 13.80% 32.08% 42.01% and single hospital systems, and declines for the other segments
Ambulatory Pharmacy 4.90% 5.09% 4.67% (see Table AH7).
Ambulatory Radiology 10.66% 14.27% 14.42% • Practice management had the best growth in the rural and
Practice Management 93.17% 96.62% 97.25% single hospital market segments while showing a decline for
* Includes 2,921 ambulatory facilities doing imaging on-site the multi-hospital segments (see Table AH8).
Ta ble A H2 | 2008
Ambulatory EMR 25 13.16% 165 86.84% 190
Ambulatory Laboratory 9 31.03% 20 68.97% 29
Ambulatory PACS* 0 0.00% 1 100.00% 1
Ambulatory Pharmacy 1 4.76% 20 95.24% 21
Ambulatory Radiology 14 42.42% 19 57.58% 33
Practice Management 89 97.80% 2 2.20% 91
*Only Includes Ambulatory Facilities Doing Imaging on Site

 Ambulatory (Hospital Owned or Managed) IT Environment (con tinue d)
Ta ble ah3 | Ambulatory EMR
2006 2007 2008
Rural 412 26.75% 1,540 624 40.52% 1,540 677 43.96% 1,540
Urban
Urban 5,267 38.71% 13,606 6,217 45.69% 13,606 6,833 50.22% 13,606
All 5,679 37.50% 15,146 6,841 45.17% 15,146 7,510 49.58% 15,146
Ta ble ah4 | Ambulatory Laboratory

2006 2007 2008
Rural 136 8.83% 1,540 181 11.75% 1,540 153 9.94% 1,540
Urban
Urban 1,872 13.76% 13,606 2,146 15.77% 13,606 2,127 15.63% 13,606
All 2,008 13.26% 15,146 2,327 15.36% 15,146 2,280 15.05% 15,146
Ta ble ah5 | Ambulatory PACS

2006 2007 2008
Count Percent Count* Count Percent Count* Count Percent Count
Rural 15 7.21% 208 36 17.31% 208 61 29.33% 208
Urban
Urban 388 14.30% 2,713 901 33.21% 2,713 1,166 42.98% 2,713
All 403 13.80% 2,921 937 32.08% 2,921 1,227 42.01% 2,921
Ta ble ah6 | Ambulatory Pharmacy

2006 2007 2008
Rural 24 1.56% 1,540 49 3.18% 1,540 25 1.62% 1,540
Urban
Urban 718 5.28% 13,606 722 5.31% 13,606 682 5.01% 13,606
All 742 4.90% 15,146 771 5.09% 15,146 707 4.67% 15,146
Ta ble ah7 | Ambulatory Radiology

2006 2007 2008
Rural 90 5.84% 1,540 154 10.00% 1,540 140 9.09% 1,540
Urban
Urban 1,524 11.20% 13,606 2,007 14.75% 13,606 2,044 15.02% 13,606
All 1,614 10.66% 15,146 2,161 14.27% 15,146 2,184 14.42% 15,146
Ta ble ah8 | Practice Management

2006 2007 2008
Rural 1,249 81.10% 1,540 1,440 93.51% 1,540 1,480 96.10% 1,540
Urban
Urban 12,865 94.55% 13,606 13,194 96.97% 13,606 13,250 97.38% 13,606
All 14,111 93.17% 15,146 14,634 96.62% 15,146 14,730 97.25% 15,146
More than half of ambulatory EMR contracts were signed in the 2000–2004 time frame. Normally, applications that were
2005–2008 time frame (see Table AH9–AH11). The rate of contract contracted before 2000 would be entering a time when the
signing for ambulatory PACS was also greatest during this time hospitals may begin to evaluate them for replacement, but with
frame. All other applications had the highest contract activity in the the current recession many hospitals will extend the useful lives
of their applications until the economy recovers.

 Ambulatory (Hospital Owned or Managed) IT Environment (con tinue d)
Ta ble A H9 Ta ble A H11
Ambulatory EMR Ambulatory Radiology
Prior to 1990 54 4,516 1.20% Prior to 1990 6 1,115 0.54%
1990 to 1994 66 4,516 1.46% 1990 to 1994 61 1,115 5.47%
1995 to 1999 389 4,516 8.61% 1995 to 1999 202 1,115 18.12%
2000 to 2004 1619 4,516 35.85% 2000 to 2004 649 1,115 58.21%
2005 to 2008 2388 4,516 52.88% 2005 to 2008 197 1,115 17.67%
Total 1,750 1,750 100.00% Practice Management
Ambulatory Laboratory Prior to 1990 339 9,797 3.46%
Prior to 1990 59 1,115 5.29% 1990 to 1994 716 9,797 7.31%
1990 to 1994 62 1,115 5.56% 1995 to 1999 2619 9,797 26.73%
1995 to 1999 269 1,115 24.13% 2000 to 2004 3799 9,797 38.78%
2000 to 2004 489 1,115 43.86% 2005 to 2008 2324 9,797 23.72%
2005 to 2008 236 1,115 21.17%
Total 1,527 1,527 100.00% Market Drivers/Factors
The hospital-owned/managed ambulatory IT application market
Ta ble A H10
has been and will continue to be impacted through 2010 by:
# for Contract
2008 Range Total % of Total • Lack of access to capital by hospitals to make application purchases.
Ambulatory PACS* • Consolidating vendor market.
Prior to 1990 0 385 0.00% • Relaxation of the Stark Laws.
1990 to 1994 0 385 0.00%
• The need to tightly couple information flows between financial
1995 to 1999 25 385 6.49%
2000 to 2004 178 385 46.23% and clinical applications.
2005 to 2008 182 385 47.27% • The need to facilitate the flow of information between the acute
Total 1,750 1,750 100.00% care and ambulatory environments.
Ambulatory Pharmacy • Government and payer pressure to increase EMR implementation
Prior to 1990 6 409 1.47%
in the ambulatory market.
1990 to 1994 19 409 4.65%
1995 to 1999 57 409 13.94% • Healthcare Information Exchange projects.
2000 to 2004 231 409 56.48% • Consumer demands for personal health information and patient
2005 to 2008 96 409 23.47% safety derived from the ambulatory EMR.
Total 1,527 1,527 100.00% • The need to better track episodes of care for quality outcomes
and pay for performance reimbursement models.
• A resurgence in capitation that may be a derivative of renewed
healthcare reform efforts.
 Radiology PACS
The radiology picture archive and communications system years that are tracked in this report. However, for these applications,
(R-PACS) environment in 2008 demonstrated good growth for academic/teaching hospitals have the highest rates of adoption. The
all modalities (see Table RP1), continuing the momentum that was academic/teaching facilities are nearing saturation of their market
seen in 2007. All of the R-PACS modalities had a year-over-year segment for all modalities except digital mammography and ortho-
growth of six percent, with angiography demonstrating the highest pedics. The orthopedic modality demonstrates a nearly 10 percent
year-over-year increase of more than 11 percent from 2007 to 2008.
Ta ble RP1 | Percentage Represents Applications That Are Live and
In 2008, all of the R-PACS modalities were heavily slanted to Operational, Contracted, or Being Installed
first-time purchases, as they were in 2007 (see Table RP2). This is N=3,975 2006 2007 2008
expected in a fast growing market like R-PACS. Over the next few Angiography 46.79% 57.64% 68.96%
CR (Computed Radiography) 53.86% 68.73% 76.08%
years the replacement purchases for R-PACS will begin to increase CT (Computed Tomography) 54.19% 69.31% 77.61%
due to the consolidation of the market vendors and products, and DF (Digital Fluorscopy) 47.90% 60.10% 66.44%
new technologies will begin to create obsolescence for some of the Digital Mammography 15.45% 24.53% 33.76%
existing solutions. DR (Digital Radiography) 48.15% 62.47% 68.93%
MRI (Magnetic Resonance Imaging) 52.53% 66.47% 73.36%
An evaluation of market segments in 2008 by hospital types shows Nuclear Medicine 49.66% 61.96% 68.63%
that all modalities have exhibited moderate to good growth over the Orthopedic N/A 20.20% 29.99%
US (Ultrasound) 52.58% 67.65% 75.25%

 Radiology PACS (con tinued)
Ta ble Rp 2 | 2008
Angiography 9 18.37% 40 81.63% 49
CR (Computed Radiography) 10 11.49% 77 88.51% 87
CT (Computed Tomography) 13 13.00% 87 87.00% 100
DF (Digital Fluorscopy) 10 15.87% 53 84.13% 63
Digital Mammography 3 3.53% 82 96.47% 85
DR (Digital Radiography) 9 14.29% 54 85.71% 63
MRI (Magnetic Resonance Imaging) 12 12.37% 85 87.63% 97
Nuclear Medicine 7 11.29% 55 88.71% 62
Orthopedic 7 21.21% 26 78.79% 33
US (Ultrasound) 12 13.48% 77 86.52% 89
growth for all segments except for rural and other (non-medical/ • Digital fluoroscopy: rural and single hospital systems (see Table RP6).
surgical hospitals) from 2007 to 2008. The hospital types that • Digital mammography: medical/surgical, urban and multiple
showed the most growth by modality for 2007 to 2008 are: hospital systems (see Table RP7).
• Angiography: medical/surgical and single hospital systems • Digital radiography: rural and single hospital systems (see Table RP8).
(see Table RP3). • MRI: rural and single hospital systems (see Table RP9).
• Computed radiography: rural and single hospital systems • Nuclear medicine: rural and single hospital systems (see Table RP10).
(see Table RP4). • Orthopedic: academic/teaching, medical surgical, and multi-
• Computed tomography: rural, single and other non-medical/ hospital systems (see Table RP11).
surgical hospital systems (see Table RP5). • Ultrasound: rural and single hospital systems (see Table RP12).
Ta ble RP 3 | Angiography
2006 2007 2008
Academic
Not Academic 1,642 44.15% 3,719 2,058 55.34% 3,719 2,233 60.04% 3,719
Med/Surg 1,393 58.58% 2,378 1,683 70.77% 2,378 1,814 76.28% 2,378
Med Surg
Other 467 29.24% 1,597 608 38.07% 1,597 657 41.14% 1,597
Rural 174 18.28% 952 259 27.21% 952 299 31.41% 952
Urban
Urban 1,686 55.77% 3,023 2,032 67.22% 3,023 2,172 71.85% 3,023
All 1,860 46.79% 3,975 2,291 57.64% 3,975 2,741 68.96% 3,975
Ta ble RP4 | CR (Computed Radiography)

2006 2007 2008
Academic
Not Academic 1,916 51.52% 3,719 2,493 67.03% 3,719 2,781 74.78% 3,719
Med/Surg 1,485 62.45% 2,378 1,817 76.41% 2,378 1,982 83.35% 2,378
Med Surg
Other 656 41.08% 1,597 915 57.29% 1,597 1,042 65.25% 1,597
Rural 253 26.58% 952 439 46.11% 952 536 56.30% 952
Urban
Urban 1,888 62.45% 3,023 2,293 75.85% 3,023 2,488 82.30% 3,023
All 2,141 53.86% 3,975 2,732 68.73% 3,975 3,024 76.08% 3,975
Ta ble RP5 | CT (Computed Tomography)

2006 2007 2008
Academic
Not Academic 1,925 51.76% 3,719 2,511 67.52% 3,719 2,835 76.23% 3,719
Med/Surg 1,550 65.18% 2,378 1,886 79.31% 2,378 2,053 86.33% 2,378
Med Surg
Other 604 37.82% 1,597 869 54.41% 1,597 1,032 64.62% 1,597
Rural 279 29.31% 952 475 49.89% 952 590 61.97% 952
Urban
Urban 1,875 62.02% 3,023 2,280 75.42% 3,023 2,495 82.53% 3,023
All 2,154 54.19% 3,975 2,755 69.31% 3,975 3,085 77.61% 3,975

Ta ble RP 6 | DF (Digital Fluorscopy)
2006 2007 2008
Academic
Not Academic 1,684 45.28% 3,719 2,156 57.97% 3,719 2,404 64.64% 3,719
Med/Surg 1,412 59.38% 2,378 1,721 72.37% 2,378 1,880 79.06% 2,378
Med Surg
Other 492 30.81% 1,597 668 41.83% 1,597 761 47.65% 1,597
Rural 192 20.17% 952 308 32.35% 952 380 39.92% 952
Urban
Urban 1,712 56.63% 3,023 2,081 68.84% 3,023 2,261 74.79% 3,023
All 1,904 47.90% 3,975 2,389 60.10% 3,975 2,641 66.44% 3,975
Ta ble RP7 | Digital Mammography

2006 2007 2008
Academic
Not Academic 534 14.36% 3,719 851 22.88% 3,719 1,197 32.19% 3,719
Med/Surg 449 18.88% 2,378 707 29.73% 2,378 975 41.00% 2,378
Med Surg
Other 165 10.33% 1,597 268 16.78% 1,597 367 22.98% 1,597
Rural 52 5.46% 952 104 10.92% 952 161 16.91% 952
Urban
Urban 562 18.59% 3,023 871 28.81% 3,023 1,181 39.07% 3,023
All 614 15.45% 3,975 975 24.53% 3,975 1,342 33.76% 3,975
Ta ble RP 8 | DR (Digital Radiography)

2006 2007 2008
Academic
Not Academic 1,702 45.76% 3,719 2,252 60.55% 3,719 2,501 67.25% 3,719
Med/Surg 1,411 59.34% 2,378 1,725 72.54% 2,378 1,872 78.72% 2,378
Med Surg
Other 503 31.50% 1,597 758 47.46% 1,597 868 54.35% 1,597
Rural 208 21.85% 952 315 33.09% 952 396 41.60% 952
Urban
Urban 1,706 56.43% 3,023 2,168 71.72% 3,023 2,344 77.54% 3,023
All 1,914 48.15% 3,975 2,483 62.47% 3,975 2,740 68.93% 3,975
Ta ble RP 9 | MRI (Magnetic Resonance Imaging)

2006 2007 2008
Academic
Not Academic 1,863 50.09% 3,719 2,401 64.56% 3,719 2,670 71.79% 3,719
Med/Surg 1,525 64.13% 2,378 1,847 77.67% 2,378 2,007 84.40% 2,378
Med Surg
Other 563 35.25% 1,597 795 49.78% 1,597 909 56.92% 1,597
Rural 248 26.05% 952 417 43.80% 952 504 52.94% 952
Urban
Urban 1,840 60.87% 3,023 2,225 73.60% 3,023 2,412 79.79% 3,023
All 2,088 52.53% 3,975 2,642 66.47% 3,975 2,916 73.36% 3,975
Ta ble RP10 | Nuclear Medicine

2006 2007 2008
Academic
Not Academic 1,763 47.41% 3,719 2,233 60.04% 3,719 2,490 66.95% 3,719
Med/Surg 1,472 61.90% 2,378 1,781 74.89% 2,378 1,950 82.00% 2,378
Med Surg
Other 502 31.43% 1,597 682 42.71% 1,597 778 48.72% 1,597
Rural 217 22.79% 952 341 35.82% 952 413 43.38% 952
Urban
Urban 1,757 58.12% 3,023 2,122 70.20% 3,023 2,315 76.58% 3,023
All 1,974 49.66% 3,975 2,463 61.96% 3,975 2,728 68.63% 3,975

Ta ble RP11 | Orthopedic
2006 2007 2008
Academic/Teaching N/A N/A 256 89 34.77% 256 126 49.22% 256
Academic
Not Academic N/A N/A 3,719 714 19.20% 3,719 1,066 28.66% 3,719
Med/Surg N/A N/A 2,378 555 23.34% 2,378 839 35.28% 2,378
Med Surg
Other N/A N/A 1,597 248 15.53% 1,597 353 22.10% 1,597
Rural N/A N/A 952 92 9.66% 952 137 14.39% 952
Urban
Urban N/A N/A 3,023 711 23.52% 3,023 1,055 34.90% 3,023
Single/Multi Multi-Hospital System N/A N/A 2,239 493 22.02% 2,239 727 32.47% 2,239
Hospital Single Hospital System N/A N/A 1,736 310 17.86% 1,736 465 26.79% 1,736
All N/A N/A 3,975 803 20.20% 3,975 1,192 29.99% 3,975
Ta ble RP12 | US (Ultrasound)

2006 2007 2008
Academic
Not Academic 1,871 50.31% 3,719 2,452 65.93% 3,719 2,747 73.86% 3,719
Med/Surg 1,526 64.17% 2,378 1,856 78.05% 2,378 2,033 85.49% 2,378
Med Surg
Other 564 35.32% 1,597 824 51.60% 1,597 958 59.99% 1,597
Rural 260 27.31% 952 444 46.64% 952 542 56.93% 952
Urban
Urban 1,830 60.54% 3,023 2,245 74.26% 3,023 2,449 81.01% 3,023
All 2,090 52.58% 3,975 2,689 67.65% 3,975 2,991 75.25% 3,975
The analysis of the R-PACS market by bed size for 2008 demon- Ta ble RP14
strates moderate to good growth for all modalities across most 101–200 Beds 2006 2007 2008
segments (see Tables RP13–RP19). Hospitals of over 400 beds % of 803 hospitals
are beginning to approach saturation for all R-PACS modules Angiography 499 62.14% 557 69.36% 614 76.46%
with the exception of digital mammography and orthopedics.

CR (Computed Radiography) 497 61.89% 601 74.84% 670 83.44%
CT (Computed Tomography) 505 62.89% 608 75.72% 677 84.31%
Mammography and orthopedic PACS modalities are exhibiting DF (Digital Fluorscopy) 455 56.66% 561 69.86% 628 78.21%
high growth at all but the smallest of hospitals (0 to 100 beds). Digital Mammography 150 18.68% 217 27.02% 314 39.10%
However, even among these hospitals, there was at least a five DR (Digital Radiography) 458 57.04% 570 70.98% 627 78.08%
percent increase in utilization. MRI (Magnetic Resonance
Imaging) 493 61.39% 593 73.85% 663 82.57%
Nuclear Medicine 481 59.90% 581 72.35% 647 80.57%
Ta ble RP13 Orthopedic N/A 0.00% 181 22.54% 289 35.99%
0–100 Beds 2006 2007 2008 US (Ultrasound) 499 62.14% 600 74.72% 666 82.94%
Angiography 465 24.08% 670 34.70% 744 38.53% Ta ble RP15
CR (Computed Radiography) 656 33.97% 1,028 53.24% 1,208 62.56% 201–300 Beds 2006 2007 2008
CT (Computed Tomography) 638 33.04% 1,029 53.29% 1,240 64.22% % of 494 hospitals
DF (Digital Fluorscopy) 497 25.74% 761 39.41% 901 46.66% Angiography 343 69.43% 394 79.76% 420 85.02%
Digital Mammography 138 7.15% 266 13.78% 400 20.71% CR (Computed Radiography) 361 73.08% 414 83.81% 437 88.46%
DR (Digital Radiography) 515 26.67% 844 43.71% 995 51.53% CT (Computed Tomography) 370 74.90% 421 85.22% 451 91.30%
MRI (Magnetic Resonance DF (Digital Fluorscopy) 344 69.64% 401 81.17% 428 86.64%
Imaging) 591 30.61% 937 48.52% 1,093 56.60%
Digital Mammography 118 23.89% 171 34.62% 224 45.34%
DR (Digital Radiography) 340 68.83% 400 80.97% 429 86.84%
Orthopedic N/A 0.00% 254 13.15% 364 18.85%
MRI (Magnetic Resonance
US (Ultrasound) 601 31.12% 983 50.91% 1,167 60.44% Imaging) 370 74.90% 419 84.82% 448 90.69%
Orthopedic N/A 0.00% 130 26.32% 200 40.49%
US (Ultrasound) 367 74.29% 420 85.02% 451 91.30%

Ta ble RP16 An evaluation of the contract purchasing time frames for these
301–400 Beds 2006 2007 2008 applications shows that most of the R-PACS contracting took
% of 308 hospitals place in the 2000 to 2004 time frame, which represented the
Angiography 232 75.32% 262 85.06% 275 89.29% rapid adoption for purchasing these applications, but contracting
in the 2005–2008 timeframe remained strong. The trend is slightly
DF (Digital Fluorscopy) 232 75.32% 261 84.74% 272 88.31% different for digital mammography, for which more than half of
Digital Mammography 74 24.03% 124 40.26% 163 52.92% contracts have been signed in 2005 or later (see Tables RP20–
DR (Digital Radiography) 233 75.65% 268 87.01% 274 88.96% RP24). We believe the contracting of the 2005–2009 time frame
Imaging) 241 78.25% 274 88.96% 286 92.86% will equal or surpass the total contracting for radiology PACS that
Nuclear Medicine 237 76.95% 267 86.69% 279 90.58% took place in 2000–2004.
Orthopedic N/A 0.00% 86 27.92% 131 42.53%
Ta ble rp 20
US (Ultrasound) 241 78.25% 275 89.29% 284 92.21%
# for Contract
Ta ble RP17
Angiography
401–500 Beds 2006 2007 2008 Prior to 1990 0 1,832 0.00%
% of 179 hospitals 1990 to 1994 0 1,832 0.00%
Angiography 142 79.33% 160 89.39% 169 94.41% 1995 to 1999 73 1,832 3.98%
CR (Computed Radiography) 147 82.12% 164 91.62% 172 96.09% 2000 to 2004 953 1,832 52.02%
CT (Computed Tomography) 155 86.59% 167 93.30% 173 96.65% 2005 to 2008 806 1,832 44.00%
DF (Digital Fluorscopy) 145 81.01% 159 88.83% 166 92.74% Total 1,832 1,832 100.00%
CR (Computed Radiography)
Prior to 1990 0 2,149 0.00%
Imaging) 154 86.03% 166 92.74% 172 96.09% 1990 to 1994 0 2,149 0.00%
Nuclear Medicine 147 82.12% 162 90.50% 169 94.41% 1995 to 1999 72 2,149 3.35%
Orthopedic N/A 0.00% 53 29.61% 82 45.81% 2000 to 2004 1,077 2,149 50.12%
US (Ultrasound) 150 83.80% 164 91.62% 172 96.09% 2005 to 2008 1,000 2,149 46.53%
Total 2,149 2,149 100.00%
Ta ble RP18
Ta ble rp 21
501–600 Beds 2006 2007 2008
# for Contract
Angiography 104 88.89% 115 98.29% 115 98.29%
CT (Computed Tomography)
Prior to 1990 0 2,205 0.00%
1990 to 1994 0 2,205 0.00%
DF (Digital Fluorscopy) 106 90.60% 114 97.44% 113 96.58%
1995 to 1999 77 2,205 3.49%
2000 to 2004 1,114 2,205 50.52%
2005 to 2008 1,014 2,205 45.99%
Imaging) 111 94.87% 117 100.00% 117 100.00% Total 2,205 2,205 100.00%
Nuclear Medicine 106 90.60% 113 96.58% 114 97.44% DF (Digital Fluorscopy)
Orthopedic N/A 0.00% 38 32.48% 50 42.74% Prior to 1990 0 1,923 0.00%
US (Ultrasound) 107 91.45% 113 96.58% 113 96.58% 1990 to 1994 0 1,923 0.00%
1995 to 1999 72 1,923 3.74%
Ta ble RP19 2000 to 2004 998 1,923 51.90%
2005 to 2008 853 1,923 44.36%
600+ Beds 2006 2007 2008
Total 1,923 1,923 100.00%
% of 143 hospitals
Angiography 125 87.41% 133 93.01% 134 93.71%
Ta ble rp 22
CT (Computed Tomography) 129 90.21% 137 95.80% 139 97.20% # for Contract
DF (Digital Fluorscopy) 125 87.41% 132 92.31% 133 93.01%
Digital Mammography
Prior to 1990 0 779 0.00%
1990 to 1994 1 779 0.13%
Imaging) 128 89.51% 136 95.10% 137 95.80% 1995 to 1999 16 779 2.05%
Nuclear Medicine 123 86.01% 132 92.31% 135 94.41% 2000 to 2004 299 779 38.38%
Orthopedic N/A 0.00% 61 42.66% 76 53.15% 2005 to 2008 463 779 59.44%
US (Ultrasound) 125 87.41% 134 93.71% 138 96.50% Total 779 779 100.00%
DR (Digital Radiography)
Prior to 1990 0 1,930 0.00%
1990 to 1994 0 1,930 0.00%
1995 to 1999 68 1,930 3.52%
2000 to 2004 991 1,930 51.35%
2005 to 2008 871 1,930 45.13%
Total 1,930 1,930 100.00%

Ta ble rp 23 Market Drivers/Factors
# for Contract The R-PACS IT application market has been and will continue
to be impacted through 2010 by:
• Ongoing demand to drive down radiology service costs
MRI (Magnetic Resonance Imaging)
Prior to 1990 0 2,098 0.00%
1990 to 1994 0 2,098 0.00% and film costs – both purchase and storage (now mostly in
1995 to 1999 74 2,098 3.53% the hospitals below 200 beds).
2000 to 2004 1,079 2,098 51.43% • Increased demand to share medical images between care
2005 to 2008 945 2,098 45.04%
providers in Health Information Exchanges (HIEs).
Total 2,098 2,098 100.00%
Nuclear Medicine
• Ongoing market consolidation that will impact vendors and prod-
Prior to 1990 0 1,997 0.00% ucts.
1990 to 1994 0 1,997 0.00% • Increased demand by the government to share patient medical
1995 to 1999 75 1,997 3.76% information and images.
2000 to 2004 1,023 1,997 51.23%
• Increasing consumer demands to have access to their medical
2005 to 2008 899 1,997 45.02%
Total 1,997 1,997 100.00%
information and images.
• The need to attach medical images to claims for improved
Ta ble rp 24 payer reimbursement processes.
2008
# for Contract
Range Total % of Total
• Implementing technology that works and has a proven ROI
Orthopedic so that the healthcare organization can demonstrate progress
Prior to 1990 0 662 0.00% to the physicians.
1990 to 1994 0 662 0.00% • Tough capital markets through most of 2009 that may slow
1995 to 1999 16 662 2.42%
the growth of radiology PACS modalities in hospitals through
2000 to 2004 323 662 48.79%
2005 to 2008 323 662 48.79%
the early part of 2010.
Total 662 662 100.00% • The need to have a full suite of radiology PACS solutions for
US (Ultrasound) both recruiting radiologists and supporting radiology therapy
Prior to 1990 0 2,151 0.00% programs.
1990 to 1994 0 2,151 0.00%
• The adoption of application service provider/remote-hosted/
1995 to 1999 76 2,151 3.53%
2000 to 2004 1,104 2,151 51.32%
service as a software solutions for radiology PACS solutions
2005 to 2008 971 2,151 45.14% in smaller hospitals.
Total 2,151 2,151 100.00%
 Cardiology PACS
In 2008, the cardiology picture archive and communications The majority of 2008 C-PACS purchasing plans continue to
system (C-PACS) environment is showing slower growth than be first time purchases (see Table CP2). This is expected in an
what was realized in 2007 (see Table CP1). The biggest growth for emerging healthcare IT market like C-PACS.
C-PACS modalities in 2008 appeared to be in the echocardiology
Ta ble CP1 | Percentage of Live and Operational, Contracted, or
lab environment, which was one of the modalities with the highest Installation in Process
growth in 2007. This market, however, continues to grow at a N=3,975 2006 2007 2008
slower pace than the radiology PACS (R-PACS) market. The slower Cardiology
growth of this market compared to the R-PACS environment can Cath Lab 15.97% 22.16% 24.65%
be attributed to a lack of significant cost reduction from the

CT (Computerized Tomography) 10.69% 13.84% 14.92%
Echocardiology 14.94% 20.73% 23.40%
replacement of film. Intravascular Ultrasound 9.86% 13.26% 14.24%
Nuclear Cardiology 9.41% 11.87% 13.18%
Ta ble Cp 2 | 2008
Cardiology Software – Replacing Software – Replacing For The First Time For The First Time Hospitals Planning
Cath Lab 7 15.56% 38 84.44% 45
CT (Computerized Tomography) 2 9.09% 20 90.91% 22
Echocardiology 5 12.82% 34 87.18% 39
Intravascular Ultrasound 1 5.00% 19 95.00% 20
Nuclear Cardiology 2 12.50% 14 87.50% 16

 Cardiology PACS (con tinued)
An evaluation of hospital-type market segments shows that the
majority of cardiology PACS modalities exhibited slight growth
from 2007 to 2008. Hospital types that showed the highest growth
by cardiology PACS modality were:
• Catheter lab: academic and medical/surgical (see Table CP3).
• Computerized tomography: academic (see Table CP4).
• Echocardiology: academic and medical/surgical (see Table CP5).
• Intravascular ultrasound: no clear segment leader (see Table CP6).
• Nuclear cardiology: single hospitals (see Table CP7).
Ta ble CP 3 | Cardiology – Cath Lab

2006 2007 2008
Academic
Not Academic 538 14.47% 3,719 750 20.17% 3,719 838 22.53% 3,719
Med/Surg 488 20.52% 2,378 681 28.64% 2,378 768 32.30% 2,378
Med Surg
Other 147 9.20% 1,597 200 12.52% 1,597 212 13.27% 1,597
Rural 12 1.26% 952 22 2.31% 952 19 2.00% 952
Urban
Urban 623 20.61% 3,023 859 28.42% 3,023 961 31.79% 3,023
All 635 15.97% 3,975 881 22.16% 3,975 980 24.65% 3,975
Ta ble CP4 | Cardiology – CT (Computerized Tomography)

2006 2007 2008
Academic
Not Academic 361 9.71% 3,719 467 12.56% 3,719 504 13.55% 3,719
Med/Surg 328 13.79% 2,378 420 17.66% 2,378 451 18.97% 2,378
Med Surg
Other 97 6.07% 1,597 130 8.14% 1,597 142 8.89% 1,597
Rural 10 1.05% 952 23 2.42% 952 19 2.00% 952
Urban
Urban 415 13.73% 3,023 527 17.43% 3,023 574 18.99% 3,023
All 425 10.69% 3,975 550 13.84% 3,975 593 14.92% 3,975
Ta ble CP5 | Cardiology – Echocardiology

2006 2007 2008
Academic
Not Academic 511 13.74% 3,719 706 18.98% 3,719 798 21.46% 3,719
Med/Surg 456 19.18% 2,378 628 26.41% 2,378 714 30.03% 2,378
Med Surg
Other 138 8.64% 1,597 196 12.27% 1,597 216 13.53% 1,597
Rural 20 2.10% 952 34 3.57% 952 30 3.15% 952
Urban
Urban 574 18.99% 3,023 790 26.13% 3,023 900 29.77% 3,023
All 594 14.94% 3,975 824 20.73% 3,975 930 23.40% 3,975
Ta ble CP6 | Cardiology – Intravascular Ultrasound

2006 2007 2008
Academic
Not Academic 329 8.85% 3,719 442 11.88% 3,719 479 12.88% 3,719
Med/Surg 301 12.66% 2,378 398 16.74% 2,378 433 18.21% 2,378
Med Surg
Other 91 5.70% 1,597 129 8.08% 1,597 133 8.33% 1,597
Rural 10 1.05% 952 19 2.00% 952 16 1.68% 952
Urban
Urban 382 12.64% 3,023 508 16.80% 3,023 550 18.19% 3,023
All 392 9.86% 3,975 527 13.26% 3,975 566 14.24% 3,975

Ta ble CP7 | Cardiology – Nuclear Cardiology
2006 2007 2008
Academic
Not Academic 321 8.63% 3,719 417 11.21% 3,719 444 11.94% 3,719
Med/Surg 288 12.11% 2,378 373 15.69% 2,378 397 16.69% 2,378
Med Surg
Other 86 5.39% 1,597 119 7.45% 1,597 127 7.95% 1,597
Rural 13 1.37% 952 24 2.52% 952 20 2.10% 952
Urban
Urban 361 11.94% 3,023 468 15.48% 3,023 504 16.67% 3,023
All 374 9.41% 3,975 472 11.87% 3,975 524 13.18% 3,975
The evaluation of the C-PACS market by bed size segments Ta ble CP13
for 2008 shows the highest growth across the modalities in the 301– 501–600 Beds 2006 2007 2008
600 bed ranges, and the least amount of growth across all modali- Cardiology % of 117 hospitals
ties in the 0–100 bed segment (see Table CP8–CP14). Cath Lab 61 52.14% 79 67.52% 83 70.94%
CT (Computerized Tomography) 45 38.46% 53 45.30% 58 49.57%
Echocardiology 52 44.44% 72 61.54% 79 67.52%
Ta ble CP 8
Intravascular Ultrasound 36 30.77% 50 42.74% 52 44.44%
0–100 Beds 2006 2007 2008 Nuclear Cardiology 42 35.90% 51 43.59% 55 47.01%
Cardiology % of 1,931 hospitals
Cath Lab 57 2.95% 92 4.76% 93 4.82% Ta ble CP14
600+ Beds 2006 2007 2008
Echocardiology 70 3.63% 113 5.85% 122 6.32%
Cardiology % of 143 hospitals
Cath Lab 58 40.56% 77 53.85% 84 58.74%
Nuclear Cardiology 44 2.28% 71 3.68% 69 3.57%
Echocardiology 49 34.27% 72 50.35% 76 53.15%
Ta ble CP 9
101–200 Beds 2006 2007 2008 Nuclear Cardiology 25 17.48% 42 29.37% 42 29.37%
Cath Lab 152 18.93% 207 25.78% 230 28.64%
An analysis of temporal contracting activity over the last four
Echocardiology 148 18.43% 197 24.53% 214 26.65% years demonstrates that the majority of purchases for currently con-
Intravascular Ultrasound 104 12.95% 129 16.06% 132 16.44% tracted products took place in the 2005–2008 time frame, which
Nuclear Cardiology 101 12.58% 116 14.45% 115 14.32% may indicate a market that has entered the rapid adoption stage of
purchasing activity (see Tables CP15–CP17). We believe the growth
of this market may be slowed in 2009 through 2010 due to the dif-
Ta ble CP10
201–300 Beds 2006 2007 2008
ficult capital markets that emerged in the later part of 2008.
Cath Lab 132 26.72% 186 37.65% 202 40.89%
CT (Computerized Tomography) 85 17.21% 106 21.46% 114 23.08% Ta ble Cp15
Echocardiology 123 24.90% 158 31.98% 185 37.45% # for Contract
Nuclear Cardiology 67 13.56% 84 17.00% 96 19.43% Cardiology – Cath Lab
Prior to 1990 0 453 0.00%
Ta ble CP11 1990 to 1994 1 453 0.22%
1995 to 1999 13 453 2.87%
301–400 Beds 2006 2007 2008
2000 to 2004 176 453 38.85%
2005 to 2008 263 453 58.06%
Cath Lab 102 33.12% 149 48.38% 173 56.17%
Total 453 453 100.00%
Cardiology – CT (Computerized Tomography)
Echocardiology 89 28.90% 129 41.88% 156 50.65%
Prior to 1990 0 267 0.00%
1990 to 1994 0 267 0.00%
1995 to 1999 7 267 2.62%
2000 to 2004 94 267 35.21%
Ta ble CP12
2005 to 2008 166 267 62.17%
401–500 Beds 2006 2007 2008
Total 267 267 100.00%
Cath Lab 73 40.78% 91 50.84% 115 64.25%
Echocardiology 63 35.20% 83 46.37% 98 54.75%

Ta ble Cp16 Ta ble Cp17
Cardiology – Echocardiology Cardiology – Nuclear Cardiology
Prior to 1990 0 426 0.00% Prior to 1990 0 256 0.00%
1990 to 1994 0 426 0.00% 1990 to 1994 0 256 0.00%
1995 to 1999 10 426 2.35% 1995 to 1999 8 256 3.13%
2000 to 2004 157 426 36.85% 2000 to 2004 91 256 35.55%
2005 to 2008 259 426 60.80% 2005 to 2008 157 256 61.33%
Total 426 426 100.00% Total 256 256 100.00%
Cardiology – Intravascular Ultrasound
Prior to 1990 0 277 0.00% Market Drivers/Factors
1990 to 1994 0 277 0.00% The C-PACS IT application market has been and will continue
1995 to 1999 8 277 2.89% to be impacted through 2010 by:
• The tight capital markets which may slow growth for cardiology
2000 to 2004 94 277 33.94%
2005 to 2008 175 277 63.18%
Total 277 277 100.00% PACS solutions through 2010.
• The demand to increase medical image-sharing among providers.
• The demand to share medical images within emerging
healthcare information exchanges.
• The demand to decrease costs for medical imaging services.
• Increased compliance for the capture, rendering, and
transmission of medical images among vendor PACS solutions.
 Bar Code Technology

Bar code technologies are integral for improving patient safety Ta ble BC 2 | Bar Coding
and operational efficiency in US hospitals. Our market data for N=3,975 2006 2007 2008
2008 demonstrated that bar coding growth was most substantial Count Percent Count Percent Count Percent
in the laboratory and radiology environments that currently have Laboratory (Planned) 142 3.57% 218 5.48% 235 5.91%
these solutions in place (see Table BC1).

Materials Management (Planned) 245 6.16% 196 4.93% 243 6.11%
Nursing (Planned) 590 14.84% 653 16.43% 1,243 31.27%
Ta ble BC1 | Bar Coding Pharmacy (Planned) 1,561 39.27% 1,855 46.67% 1,113 28.00%
N=3,975 2006 2007 2008 Radiology (Planned) 182 4.58% 152 3.82% 131 3.30%
Count Percent Count Percent Count Percent
Laboratory (Current) 1,929 48.53% 2,631 66.19% 3,011 75.75% We have already discovered some hospitals that use both bar code
Materials Management (Current) 966 24.30% 1,283 32.28% 1,566 39.40% technology and RFID technology in the closed loop medication
Nursing (Current) 929 23.37% 1,266 31.85% 1,392 35.02% administration process. We believe RFID will become a replace-
Pharmacy (Current) 1,080 27.17% 1,597 40.18% 1,861 46.82%
ment technology for bar code applications in the healthcare delivery
Radiology (Current) 1,160 29.18% 1,478 37.18% 1,791 45.06%
and supply chain management processes, but that significant
The highest planned purchases over the next 12 to 18 months will adoption of RFID in these areas will not occur for at least another
be in the nursing and pharmacy environments (see Table BC2). five to ten years.
This is expected as hospitals continue to implement the “five Market Drivers/Factors
rights” of medication administration driven by strategies to improve The bar code technology market has been and will continue to
patient safety. The closed loop medication administration process is be impacted through 2010 by:
identified as stage 5 in the HIMSS Analytics EMR Adoption • Limited access to capital; this could impact the purchases for
ModelSM. This is the most complex and demanding level of hospital bar code technologies in 2009.
IT transformation as it requires the tight coupling of data between • The drive for hospitals to implement the five rights of medication
the computerized practitioner order entry (CPOE), pharmacy, and administration and to improve patient safety.
nursing documentation applications, along with integrated bar code • The desire to improve supply chain management functions
processing of medication transactions at the point of care. throughout the hospital to reduce inventory and management costs.
• The lack of consistent industry-enforced standards for the
technology of materials packaging and medication packaging.
• The integration overhead of integrating bar code technology with
healthcare IT applications.
• The adoption of RFID technologies as replacement technologies
for bar code applications over the next decade.

 Electronic Medical Record Environment
In 2008, the electronic medical record (EMR) application suite (please see the Nursing IT section for additional information). The
showed moderate growth for clinical data repository (CDR), CDS application showed the most growth from 2007 to 2008. In
clinical decision support (CDS), computerized practitioner order this suite of EMR applications, the general order entry (OE) appli-
entry (CPOE) and physician documentation (see Table EMR1). cation is approaching market saturation, but we believe it is becom-
These applications have the ability to significantly impact the ing obsolete as hospitals implement CPOE applications that can
clinical outcomes and patient safety for hospitals. The legacy accommodate physician and other clinician ordering.
general order entry application that was a component of the older
hospital information system suites from the 1980s and 1990s had The majority of purchasing plans for applications in the EMR suite
very slight growth in 2008. Nursing applications are also part of in 2008 were first-time purchases, with the exception of the older
the EMR suite, but we have broken them out for separate analysis legacy application of order entry (see Table EMR2). This is consistent
with what was seen in 2007. Older order entry applications, which
Ta ble E MR1 | Percentage Represents Live and Operational,
Contracted, or Installations in Process were mainly designed for non-clinicians, are being replaced as
N=3,975 2006 2007 2008 newer interdisciplinary clinical documentation and CPOE products
Clinical Data Repository 63.90% 77.79% 81.31% are being acquired. This is expected, as the majority of U.S. hospitals
Clinical Decision Support 51.75% 61.18% 66.01% moves to best-of-suite purchases for EMR applications and replace
Computerized Practitioner Order Entry (CPOE) 35.52% 42.31% 45.33% the older hospital information system based order entry applications
with newer generation CPOE products.
Order Entry (includes Order Communication) 78.47% 87.12% 88.91%
Physician Documentation 27.95% 36.96% 40.60%
Ta ble E MR 2 | 2008
Cardiology Software – Replacing Software – Replacing For The First Time For The First Time Hospitals Planning
Clinical Data Repository 20 37.74% 33 62.26% 53
Clinical Decision Support 13 30.95% 29 69.05% 42
Computerized Practitioner Order Entry (CPOE) 2 1.44% 137 98.56% 139
Order Entry (includes Order Communications) 24 53.33% 21 46.67% 45
Physician Documentation 3 3.80% 76 96.20% 79
An evaluation of hospital-type market segment growth from • Order entry: not academic hospitals and single hospital systems
2007 to 2008 shows the highest growth by application occurred had the highest growth in 2008 (see Table EMR6).
in the following: • Physician documentation: academic/teaching, urban and
• CDR: rural, medical/surgical and single hospital systems medical/surgical hospitals had the highest growth in 2008
had the best growth in 2008 (see Table EMR3). (see Table EMR7).
• CDS: not academic, other (non-medical/surgical hospitals),
We would expect that academic medical centers and medical/
rural and single hospital systems had the highest growth per
surgical hospitals would have the best growth in physician-focused
segments, but all segments demonstrated good growth in
applications (e.g., physician documentation) as these organizations;
2008 (see Table EMR4).
in particular, academic medical centers tend to pioneer new
• CPOE: multiple hospital system and medical/surgical hospitals
application technologies and have a higher volume of patients.
showed the highest growth in 2008 (see Table EMR5).
Ta ble E MR3 | Clinical Data Repository

2006 2007 2008
Academic
Not Academic 2,312 62.17% 3,719 2,849 76.61% 3,719 2,986 80.29% 3,719
Med/Surg 1,720 72.33% 2,378 2,031 85.41% 2,378 2,102 88.39% 2,378
Med Surg
Other 820 51.35% 1,597 1,061 66.44% 1,597 1,130 70.76% 1,597
Rural 352 36.97% 952 514 53.99% 952 560 58.82% 952
Urban
Urban 2,188 72.38% 3,023 2,578 85.28% 3,023 2,672 88.39% 3,023
All 2,540 63.90% 3,975 3,092 77.79% 3,975 3,232 81.31% 3,975

 Electronic Medical Record Environment (con tinue d)
Ta ble E MR4 | Clinical Decision Support
2006 2007 2008
Academic
Not Academic 1,859 49.99% 3,719 2,219 59.67% 3,719 2,401 64.56% 3,719
Med/Surg 1,465 61.61% 2,378 1,693 71.19% 2,378 1,796 75.53% 2,378
Med Surg
Other 592 37.07% 1,597 739 46.27% 1,597 828 51.85% 1,597
Rural 260 27.31% 952 347 36.45% 952 409 42.96% 952
Urban
Urban 1,797 59.44% 3,023 2,085 68.97% 3,023 2,215 73.27% 3,023
All 2,057 51.75% 3,975 2,432 61.18% 3,975 2,624 66.01% 3,975
Ta ble E MR5 | Computerized Practitioner Order Entry (CPOE)

2006 2007 2008
Academic
Not Academic 1,227 32.99% 3,719 1,481 39.82% 3,719 1,592 42.81% 3,719
Med/Surg 902 37.93% 2,378 1,069 44.95% 2,378 1,152 48.44% 2,378
Med Surg
Other 510 31.93% 1,597 613 38.38% 1,597 650 40.70% 1,597
Rural 130 13.66% 952 197 20.69% 952 218 22.90% 952
Urban
Urban 1,282 42.41% 3,023 1,485 49.12% 3,023 1,584 52.40% 3,023
All 1,412 35.52% 3,975 1,682 42.31% 3,975 1,802 45.33% 3,975
Ta ble E MR6 | Order Entry (Includes Order Communication)

2006 2007 2008
Academic
Not Academic 2,873 77.25% 3,719 3,211 86.34% 3,719 3,280 88.20% 3,719
Med/Surg 2,150 90.41% 2,378 2,265 95.25% 2,378 2,279 95.84% 2,378
Med Surg
Other 969 60.68% 1,597 1,198 75.02% 1,597 1,255 78.58% 1,597
Rural 460 48.32% 952 640 67.23% 952 678 71.22% 952
Urban
Urban 2,659 87.96% 3,023 2,823 93.38% 3,023 2,856 94.48% 3,023
All 3,119 78.47% 3,975 3,463 87.12% 3,975 3,534 88.91% 3,975
Ta ble E MR7 | Physician Documentation

2006 2007 2008
Academic
Not Academic 996 26.78% 3,719 1,325 35.63% 3,719 1,452 39.04% 3,719
Med/Surg 726 30.53% 2,378 944 39.70% 2,378 1,046 43.99% 2,378
Med Surg
Other 385 24.11% 1,597 525 32.87% 1,597 568 35.57% 1,597
Rural 102 10.71% 952 184 19.33% 952 210 22.06% 952
Urban
Urban 1,009 33.38% 3,023 1,285 42.51% 3,023 1,404 46.44% 3,023
All 1,111 27.95% 3,975 1,469 36.96% 3,975 1,614 40.60% 3,975
The analysis of the EMR market by bed size in 2008 demonstrated • Order entry: the 0–100 bed segment generated significant
the following results (see Tables EMR8–EMR14): growth for this application in 2008 due to the inclusion of
• CDR: the highest growth segment in 2008 was in the critical access hospitals which are in the 1–100 bed segment.
0–100 bed segment. • Physician documentation: the over 600 bed segment had the
• CDSS: the 0–100, 201–300, 301–400 and over 600 bed highest growth with an increase of almost seven percent
segments demonstrated the highest growth. from 2007 to 2008.
• CPOE: the 600+ bed segment had the highest growth in
2008 (an increase of almost seven percent).

Ta ble E MR8 Ta ble E MR14
0–100 Beds 2006 2007 2008 600+ Beds 2006 2007 2008
Clinical Data Repository 906 46.92% 1,251 64.79% 1,340 69.39% Clinical Data Repository 134 93.71% 139 97.20% 141 98.60%
Clinical Decision Support 649 33.61% 867 44.90% 994 51.48% Clinical Decision Support 117 81.82% 120 83.92% 127 88.81%
Computerized Practitioner Computerized Practitioner
Order Entry (CPOE) 473 24.50% 604 31.28% 644 33.35% Order Entry (CPOE) 89 62.24% 98 68.53% 109 76.22%
Order Entry (includes Order Order Entry (includes Order
Communications) 1,151 59.61% 1,469 76.07% 1,532 79.34% Communications) 142 99.30% 142 99.30% 143 100.00%
Physician Documentation 372 19.26% 548 28.38% 585 30.30% Physician Documentation 60 41.96% 79 55.24% 90 62.94%
Ta ble E MR9 Most of the contracting for these applications took place in the
101–200 Beds 2006 2007 2008 2000–2004 time period (see Tables EMR16–EMR18), although
% of 803 hospitals
the contracting activity for physician documentation was nearly
Clinical Data Repository 615 76.59% 694 86.43% 713 88.79%
Clinical Decision Support 501 62.39% 585 72.85% 603 75.09%
as strong as the contracts signed in 2004 to 2008. But we expect
Computerized Practitioner the 2005 to 2009 time frame to equal or exceed the contracting that
Order Entry (CPOE) 300 37.36% 346 43.09% 375 46.70% took place from 2000–2004 for clinical decision support, CPOE,
and physician documentation as smaller hospitals and health sys-
Order Entry (includes Order
Communications) 764 95.14% 777 96.76% 776 96.64%
Physician Documentation 262 32.63% 322 40.10% 369 45.95% tems which comprise approximately half the HCOs in the country
make their initial EMR investments.
Ta ble E MR10
201–300 Beds 2006 2007 2008 Ta ble E MR15
% of 494 hospitals # for Contract
Clinical Data Repository 386 78.14% 444 89.88% 463 93.72% 2008 Range Total % of Total
Clinical Decision Support 341 69.03% 378 76.52% 403 81.58% Clinical Data Repository
Computerized Practitioner Prior to 1990 34 2,263 1.50%
Order Entry (CPOE) 227 45.95% 253 51.21% 278 56.28%
1990 to 1994 213 2,263 9.41%
Order Entry (includes Order
Communications) 477 96.56% 481 97.37% 486 98.38% 1995 to 1999 513 2,263 22.67%
Physician Documentation 180 36.44% 227 45.95% 258 52.23% 2000 to 2004 924 2,263 40.83%
2005 to 2008 579 2,263 25.59%
Ta ble E MR11 Total 2,263 2,263 100.00%
Clinical Decision Support
301–400 Beds 2006 2007 2008
Prior to 1990 30 1,885 1.59%
% of 308 hospitals
1990 to 1994 205 1,885 10.88%
Clinical Data Repository 243 78.90% 284 92.21% 292 94.81%
1995 to 1999 413 1,885 21.91%
2000 to 2004 704 1,885 37.35%
Computerized Practitioner
Order Entry (CPOE) 152 49.35% 181 58.77% 192 62.34% 2005 to 2008 533 1,885 28.28%
Order Entry (includes Order Total 1,885 1,885 100.00%
Communications) 295 95.78% 302 98.05% 305 99.03%
Physician Documentation 110 35.71% 140 45.45% 146 47.40% Ta ble E MR16
# for Contract
Ta ble E MR12 2008 Range Total % of Total
401–500 Beds 2006 2007 2008 Computerized Practitioner Order Entry (CPOE)
Clinical Data Repository 148 82.68% 167 93.30% 170 94.97% 1990 to 1994 91 1,288 7.07%
Clinical Decision Support 138 77.09% 143 79.89% 148 82.68% 1995 to 1999 58 1,288 4.50%
Computerized Practitioner 2000 to 2004 665 1,288 51.63%
Order Entry (CPOE) 90 50.28% 109 60.89% 114 63.69% 2005 to 2008 473 1,288 36.72%
Order Entry (includes Order Total 1,288 1,288 100.00%
Communications) 175 97.77% 175 97.77% 177 98.88% Order Entry (Includes Order Communications)
Physician Documentation 70 39.11% 85 47.49% 93 51.96% Prior to 1990 101 2,766 3.65%
1990 to 1994 429 2,766 15.51%
Ta ble E MR13 1995 to 1999 624 2,766 22.56%
501–600 Beds 2006 2007 2008 2000 to 2004 1,035 2,766 37.42%
% of 117 hospitals 2005 to 2008 577 2,766 20.86%
Clinical Data Repository 108 92.31% 113 96.58% 113 96.58% Total 2,766 2,766 100.00%
Computerized Practitioner Ta ble E MR17
Order Entry (CPOE) 81 69.23% 91 77.78% 90 76.92% # for Contract
Order Entry (includes Order 2008 Range Total % of Total
Communications) 115 98.29% 117 100.00% 115 98.29%
Physician Documentation
Physician Documentation 57 48.72% 68 58.12% 73 62.39%
Prior to 1990 5 1,083 0.46%
1990 to 1994 155 1,083 14.31%
1995 to 1999 83 1,083 7.66%
2000 to 2004 430 1,083 39.70%
2005 to 2008 410 1,083 37.86%
Total 1,083 1,083 100.00%

Market Drivers/Factors of these standards to improve clinical system integration
The EMR environment market has been or may be impacted and data sharing.
through 2010 by: • A focus by the U.S. government to improve data sharing
• Lack of access to capital that may impact the acquisition and of patient medical information between providers.
installation of EMR products through 2010. • The failure of regional health information organizations (RHIOs)
• An anticipated infusion of funding by Congress and the Obama due to a lack of clinical data sharing between or among provider
administration to drive the adoption and use of EMRs to improve systems needed to support their business models.
patient safety and clinical outcomes while reducing healthcare • The need to cut clinical operating costs for acquiring, managing,
delivery costs. and analyzing clinical data.
• An increased focus on patient safety, notably, decreasing • A shift of focus to revenue cycle management IT implementa-
medication errors and medical errors. tions due to regulatory changes (e.g., v5010 claims transaction
• An increased focus on improving quality of care to compete standards, and ICD-10 coding updates), and increased budget
in quality of care reimbursement models. competition for EMR environment applications.
• A lack of interoperability standards (and the noise and hype • An increase in IT operating expenses as more sophisticated and
around the creation of those standards) and vendor adoption complex EMR applications are implemented.
 The EMR Adoption ModelSM : Measuring Clinical IT Transformation

Many people in the U.S. healthcare industry, our government, adoption of the CCD transaction standard, and the lack of a
and the media use the terms electronic medical record (EMR) standard CMV to define the data within the CCD. If history is
and electronic health record (EHR) interchangeably. However, any indicator, the government will need to drive the adoption and
these terms describe completely different concepts, both of which use of CCD and a CMV if we are going to experience the benefits
are crucial to the success of local, regional, and national goals to or potential of the CCD transactions for improving and coordinat-
improve patient safety, improve the quality and efficiency of patient ing healthcare delivery in the near future.
care, and reduce healthcare delivery costs. This will be especially
Before we can start sharing encounter summary information among
important in 2009 through 2012 during the Obama administration’s
providers and consumers, providing the true rationale and content
efforts to move the U.S. out of a severe recession.
for healthcare information exchanges (HIEs), and personal health
For the purposes of our research to ensure that we get consistent records (PHRs) for individuals, care delivery organizations must imple-
information from healthcare organizations, we use the term “EMR” ment complete EMR solutions so that they have discrete electronic
to describe the systems that support the clinical documentation of data to share with the other stakeholders. At this point, few hospitals
care delivery in acute care and ambulatory environments. They have complete EMR solutions that can help to reduce medical errors
are the systems owned by the hospitals and clinics for use by their or to improve the quality and efficiency of patient care or to share
employees and physicians. They support the care delivery processes information with other stakeholders in the wellness and sick-care
of that healthcare organization. continuum. However, most of the more than 5,000 hospitals and
health systems that HIMSS Analytics surveys each year have plans
Again, for the purposes of our research, we use the term “EHR”
for or have begun implementations of EMR environments.
to describe the summary information that is generated by each
healthcare organization’s EMR about patient visits in that organiza- The EMR Adoption ModelSM has been developed by HIMSS
tion. That summary information could be sent to other community Analytics to assess the status of clinical system/EMR implemen-
caregivers, local or regional health information exchanges, or tations in care delivery organizations – specifically hospitals.
to the patient’s personal health record. The “EHR” becomes the This model demonstrates that U.S. hospitals have a long journey
longitudinal record of the patient’s interactions with the health ahead of them to achieve the ubiquitous EHR visions that were
and wellness system, and serves many of the stakeholders in the espoused by the Bush administration the last four years and to
healthcare system. support the more than 200 HIE and regional healthcare information
organization (RHIO) initiatives in various states of development
Stakeholders are composed of patients/consumers, healthcare
(and disarray) across the country.
providers, employers, and/or payers/insurers, including the
government. The key for driving the sharing of secure patient infor-
EMR Adoption ModelSM : An EMR Market Transformation Assessment Tool
mation among stakeholders is the ability of the industry
Understanding the level of EMR capabilities in hospitals is a chal-
to adopt the Continuity of Care Document (CCD) transaction
lenge in the U.S. healthcare IT market today. HIMSS Analytics has
standard in a way that also uses a controlled medical vocabulary
created an EMR Adoption Model that identifies the levels of EMR
(CMV) so that discreet data in the CCD transaction can be can
capabilities ranging from the initial clinical data repository (CDR)
be instantly recognized by any receiving EMR. We appear to
environment through a paperless EMR environment with full data
be three to five years away from these capabilities, not because
analytics and data sharing capabilities. HIMSS Analytics has
of the technologies, but because of a lack of speed of industry
developed a methodology and algorithms to automatically score the

 The EMR Adoption ModelSM : Measuring Clinical IT Transformation (con tinue d)
more than 5,000 hospitals in our database relative to their progress (i.e., other hospitals, ambulatory clinics, sub-acute environments,
in implementing the components of an EMR and to provide peer employers, payers and patients). An electronic abstract in the form
comparisons for care delivery organizations as they strategize their of the CCD can be generated and exchanged with another facility
path to a complete EMR and participation in EHR initiatives. The able to receive and process the CCD information.
stages of the model are as follows:
The hospital also employs data warehousing and data mining
Stage 0: Some clinical automation may be present, but all three of technologies to analyze care delivery data for improving protocols
the major ancillary department systems for laboratory, pharmacy, via decision support.
and radiology are not implemented.
This stage allows the healthcare organization to support the true
Stage 1: All three of the major ancillary clinical systems (pharmacy, sharing and use of health and wellness information by consumers
laboratory, radiology) are installed. and providers alike.
Stage 2: Major ancillary clinical systems feed data to a clinical
Scoring Format
data repository (CDR) that provides physician access for retrieving
An EMR score is represented by the following format – S.nnnn,
and reviewing results. The CDR contains a controlled medical
where “S” equals the current stage achieved for the model, and
vocabulary (CMV), and the clinical decision support/rules engine
the “.nnnn” represents the weighted score representing the imple-
(CDSS) for rudimentary conflict checking. Information from docu-
mentation of higher stage clinical applications that have been
ment imaging systems may be linked to the CDR at this stage.
implemented before the higher stage has been fully achieved. In
Stage 3: Clinical documentation (e.g., vital signs, flow sheets) is this model, all applications in previous stages and the current stage
required; nursing notes, care plan charting, and/or the electronic must be achieved before the current stage score is achieved. For
medication administration record (eMAR) system are scored with example, if a hospital has installed CPOE, but has not yet imple-
extra points, and are implemented and integrated with the CDR mented clinical documentation used by nursing, then the hospital
for at least one service or one unit in the hospital. The first level would be scored as a Stage 2 hospital and the four digits after the
of clinical decision support is implemented to conduct error check- stage designation would identify the weighted points that had been
ing with order entry (i.e., drug/drug, drug/food, drug/lab conflict achieved for implementing CPOE (2.nnnn).
checking normally found in the pharmacy). Some level of medical
An overall evaluation of the U.S. hospital market for the EMR
image access from picture archive and communication systems
Adoption Model scores by individual stage for 2008 as compared
(PACS) is available for access by physicians via the organization’s
to 2007 is shown in Figure EMR1. This figure clearly shows that
intranet or other secure networks outside of the radiology depart-
most U.S. hospitals are now in Stage 3 compared to 2007 when
ment confines.
most hospitals were at Stage 2. Stage 3 provides the foundation
Stage 4: Computerized practitioner order entry (CPOE) for use for progressing to more advanced stages of clinical information sys-
by any clinician is added to the nursing and CDR environment tem capabilities (e.g., CPOE, closed loop medication administra-
along with the second level of clinical decision support capabilities tion, and physician documentation). What we have observed with
related to evidence-based medicine protocols. If one patient service the Model scores over the last 12 months is that the percentage of
area (not counting the emergency department) has implemented hospitals in Stages 0–2 is decreasing and the percentage of hospitals
CPOE and completed the previous stages, then this stage has at Stage 3 and higher is increasing. This demonstrates that U.S. hos-
been achieved. pitals are continuing to advance their EMR capabilities to meet new
market demands and requirements, even in a down
Stage 5: The closed loop medication administration environment
economy that was experienced in the last half of 2008.
is fully implemented in at least one patient care service area. The
eMAR and bar coding or other auto identification technology,
F igure E MR1 | EMR Adoption ModelSM Trends 2007–2008
such as radio frequency identification (RFID), are implemented and
integrated with CPOE and pharmacy to support the five rights of
N=5,073/5,168 2007 2008
medication administration, thereby maximizing point of care

Medical record fully electronic; HCO able to contribute
STAGE 7 0.0% 0.4%
CCD as byproduct of EMR; Data warehousing in use
patient safety processes. Physician documentation (structured templates),
STAGE 6 0.8% 1.4%
full CDSS (variance & compliance), full R-PACS
Stage 6: Full physician documentation/charting (using structured
templates) is implemented for at least one patient care service area. STAGE 5 Closed loop medication administration 1.4% 1.5%
Level three of clinical decision support provides guidance for all
clinician activities related to protocols and outcomes in the form STAGE 4 CPOE, CDSS (clinical protocols) 2.2% 2.5%
of variance and compliance alerts at the time of order entry. A full Clinical documentation (flow sheets), CDSS
STAGE 3 25.1% 35.7%
complement of radiology PACS systems provides medical images (error checking), PACS available outside Radiology
to physicians via an intranet and displaces all film-based images. STAGE 2 Clinical Data Repository, Controlled Medical Vocabulary, 37.2% 31.4%
Clinical Decision Support, may have Document Imaging
Stage 7: The hospital has a paperless EMR environment. Clinical
information can be readily analyzed and reported on for quality
STAGE 1 Ancillaries – Lab, Rad, Pharmacy – All Installed 14.0% 11.5%
and patient safety initiatives, and shared via standardized electronic STAGE 0 All Three Ancillaries Not Installed 19.3% 15.6%
transactions with all entities within a health information exchange

 The EMR Adoption ModelSM : Measuring Clinical IT Transformation (con tinue d)
The majority of U.S. hospitals are in the early stages of EMR trans- An evaluation of state EMR Adoption Model score ranking by
formation. An evaluation of U.S. hospitals by type, bed size, and median scores shows that the top 10 states in 2008 were Rhode
region (see Table EMR1) with 2008 data demonstrated: Island, Maine, New Jersey, Maryland, Virginia, Alaska,
• Academic/teaching hospitals had the highest mean and median Connecticut, New Hampshire, Massachusetts, and Indiana. States
EMR Adoption Model scores for all hospital types; this is with fewer hospitals have an advantage in state scoring, and states
unchanged from 2007. with high numbers of critical access hospitals have a disadvantage
• The greater than 600 bed market had the highest mean score in state scoring (see Tables EMR2 and EMR3).
and median score by bed size, while the 501–600 segment had
Ta ble E MR 2
the highest median score in 2007.
• The New England region had the highest mean and median score State Mean Min Max Median N
RI 4.0243 2.1500 6.0230 3.2430 10
by region, while the Mid Atlantic region had the highest median ME 2.9952 0.0550 6.0230 3.1920 37
score in 2007. NJ 2.7235 0.0150 5.0870 3.1510 65
MD 3.0232 0.0250 6.0150 3.1390 45
We believe that we may see a decrease in the growth of hospitals in VA 2.6305 0.0100 6.0150 3.1390 66
stage 3 and higher in 2009 through 2010, depending upon the AK 2.2564 0.0000 4.1260 3.0720 11
length and severity of the current economic recession. CT 2.8460 0.1450 6.0230 3.0640 32
NH 2.5528 0.0550 5.0790 3.0560 24
Ta ble E MR1 | 2008 MA 2.7841 0.2200 6.0080 2.7280 84
Segment Mean Min Max Median N IN 2.5585 0.0050 6.0080 2.4390 119
Hospital Type Segment NC 2.6310 0.0400 5.1100 2.3670 114
Academic/Teaching 3.3618 2.0150 6.0230 3.2670 267 SC 2.4901 0.0600 5.0870 2.3520 61
Non-Academic 2.1408 0.0000 7.0230 2.1690 4,378 OH 2.5075 0.0150 6.0150 2.3420 182
Gen Med/Surg 2.4895 0.0050 7.0230 2.3520 2,817 PA 2.5661 0.0050 6.0150 2.3290 183
Others 1.7817 0.0000 6.0230 2.0540 1,828 FL 2.5100 0.0050 6.0150 2.3200 191
Rural 1.4140 0.0000 7.0230 1.3040 1,205 DC 2.6760 2.1540 3.4090 2.3150 7
Urban 2.4901 0.0050 7.0230 2.3260 3,440 NY 2.5092 0.0050 6.0080 2.3035 206
IDS 2.3795 0.0000 7.0230 2.2290 2,690 VT 2.4556 1.0710 4.2540 2.2915 12
Independent Hospital 1.9791 0.0000 6.0230 2.1090 1,955 MO 2.4002 0.0000 6.0230 2.2810 114
Critical Access 1.3220 0.0000 6.0230 1.1020 1,169 OR 2.2260 0.0720 4.1490 2.2590 49
Not Critical Access 2.5099 0.0050 7.0230 2.3145 3,476 DE 2.5444 1.2140 3.2770 2.2490 9
Bed Segment IL 2.4669 0.0000 6.0230 2.2480 190
0–100 Beds 1.6838 0.0000 6.0230 2.0300 2,360 CO 2.1852 0.0050 5.0790 2.2470 71
101–200 Beds 2.5220 0.0050 7.0230 2.3600 901 WI 2.3027 0.0050 6.0230 2.2450 133
201–300 Beds 2.7769 0.0250 7.0230 3.1330 548 GA 2.2905 0.0000 6.0230 2.2350 129
301–400 Beds 2.8572 0.0400 6.0230 3.1580 344 WA 2.2264 0.0000 5.0870 2.2340 76
401–500 Beds 2.9533 0.1900 6.0230 3.2070 198
501–600 Beds 3.1064 0.0840 6.0230 3.2290 131 Ta ble E MR3
600+ Beds 3.2362 1.1390 6.0230 3.2540 163 State Mean Min Max Median N
Regions (U.S. Census Defined) AL 2.1589 0.0050 4.0720 2.2290 102
East North Central 2.4448 0.0000 6.0230 2.2475 770 TN 2.3355 0.0100 6.0230 2.2100 126
East South Central 2.1443 0.0000 6.0230 2.1690 409 AZ 2.4913 0.0050 6.0000 2.1960 72
Middle Atlantic 2.5628 0.0050 6.0150 2.3560 454 MI 2.3746 0.0050 6.0230 2.1950 146
Mountain 2.0043 0.0000 6.0000 2.1090 357 WV 2.1624 0.0420 4.2610 2.1870 49
New England 2.8479 0.0550 6.0230 3.0720 199 UT 2.3140 0.0050 3.4170 2.1850 36
Pacific 2.1593 0.0000 7.0230 2.1520 506 KY 2.3234 0.0000 6.0230 2.1690 90
South Atlantic 2.5096 0.0000 6.0230 2.3520 671 NV 2.0509 0.0100 3.3390 2.1600 34
West North Central 1.7104 0.0000 6.0230 2.0385 620 ID 1.9817 0.0000 5.0720 2.1540 35
West South Central 1.8627 0.0000 6.0230 2.0790 659 MN 2.0302 0.0000 6.0230 2.1410 122
All Hospitals CA 2.1824 0.0050 7.0230 2.1090 346
Total 2.2109 0.0000 7.0230 2.1960 4,645 NM 2.0781 0.0050 4.1390 2.1020 38
IA 1.8167 0.0000 3.4090 2.0965 116
Region Key for States:
New England . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MA, ME, VT, RI, CT, NH TX 1.9037 0.0000 6.0150 2.0940 370
Middle Atlantic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NY, NJ, PA LA 1.9807 0.0050 6.0230 2.0705 118
South Atlantic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MD, DE, DC, WV, VA, NC, SC, GA, FL OK 1.7053 0.0000 3.4170 2.0450 96
East North Central . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MI, OH, IN, IL, WI
East South Central . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . KY, TN, MS, AL AR 1.6762 0.0050 5.0630 2.0300 75
West North Central . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MN, IA, MO, KS, ND, SD, NE MS 1.6859 0.0000 6.0230 2.0150 91
West South Central . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . TX, LA, AR, OK HI 1.4342 0.0050 4.1570 1.6595 24
Mountain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ID, CO, WY, MT, NV, UT, AZ, NM
Pacific . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . WA, CA, OR, AK, HI WY 1.5282 0.0100 3.2440 1.1450 25
NE 1.4612 0.0000 5.0550 1.1020 75
KS 1.2614 0.0000 3.4170 0.4240 115
SD 0.7972 0.0050 3.4090 0.1360 46
ND 1.1584 0.0000 3.2670 0.1160 32
MT 0.9009 0.0000 3.3260 0.0725 46
This population reflects all hospitals in 2008 database (updated as of 12/18/2008). Total 2.2109 0.0000 7.0230 2.1960 4,645
HIMSS Analytics publishes quarterly updates of the EMR Adoption Model results on its
web site (http://www.himssanalytics.org/hc_providers/emr_adoption.asp).

 Appendix
0–100 Beds 101–200 Beds 201–300 Beds
2007 2008 2007 2008 2007 2008
Applications % of 1,931 hospitals % of 1,931 hospitals % of 803 hospitals % of 803 hospitals % of 494 hospitals % of 494 hospitals
Abstracting 1,667 86.33% 1,733 89.75% 793 98.75% 799 99.50% 490 99.19% 491 99.39%
Accounts Payable 1,870 96.84% 1,918 99.33% 800 99.63% 803 100.00% 493 99.80% 494 100.00%
ADT/Registration 1,847 95.65% 1,901 98.45% 800 99.63% 801 99.75% 493 99.80% 494 100.00%
Anatomical Pathology 614 31.80% 611 31.64% 580 72.23% 599 74.60% 421 85.22% 436 88.26%
Bed Management NA NA 177 9.17% NA NA 121 15.07% NA NA 114 23.08%
Benefits Administration 1,365 70.69% 1,455 75.35% 768 95.64% 765 95.27% 481 97.37% 480 97.17%
Blood Bank 724 37.49% 785 40.65% 654 81.44% 686 85.43% 441 89.27% 462 93.52%
Browser 1,436 74.37% 1,735 89.85% 671 83.56% 756 94.15% 408 82.59% 454 91.90%
Budgeting 1,298 67.22% 1,420 73.54% 697 86.80% 706 87.92% 434 87.85% 443 89.68%
Business Intelligence 318 16.47% 396 20.51% 225 28.02% 270 33.62% 160 32.39% 192 38.87%
Cardiology – Cath Lab 92 4.76% 93 4.82% 207 25.78% 230 28.64% 186 37.65% 202 40.89%
Cardiology – CT (Computerized Tomography) 73 3.78% 80 4.14% 125 15.57% 128 15.94% 106 21.46% 114 23.08%
Cardiology – Echocardiology 113 5.85% 122 6.32% 197 24.53% 214 26.65% 158 31.98% 185 37.45%
Cardiology – Intravascular Ultrasound 67 3.47% 66 3.42% 129 16.06% 132 16.44% 99 20.04% 108 21.86%
Cardiology – Nuclear Cardiology 71 3.68% 69 3.57% 116 14.45% 115 14.32% 84 17.00% 96 19.43%
Cardiology Information System 278 14.40% 287 14.86% 406 50.56% 441 54.92% 318 64.37% 340 68.83%
Case Mix Management 1,222 63.28% 1,282 66.39% 714 88.92% 711 88.54% 446 90.28% 447 90.49%
Chart Deficiency 1,430 74.05% 1,517 78.56% 779 97.01% 785 97.76% 486 98.38% 488 98.79%
Chart Tracking/Locator 1,368 70.84% 1,466 75.92% 772 96.14% 777 96.76% 481 97.37% 482 97.57%
Clinical Data Repository 1,251 64.79% 1,340 69.39% 694 86.43% 713 88.79% 444 89.88% 463 93.72%
Clinical Decision Support 867 44.90% 994 51.48% 585 72.85% 603 75.09% 378 76.52% 403 81.58%
Computerized Practitioner Order Entry (CPOE) 604 31.28% 644 33.35% 346 43.09% 375 46.70% 253 51.21% 278 56.28%
Contract Management 926 47.95% 973 50.39% 574 71.48% 589 73.35% 364 73.68% 369 74.70%
Cost Accounting 1,003 51.94% 1,078 55.83% 595 74.01% 599 74.60% 403 81.58% 405 81.98%
Credit/Collections 1,513 78.35% 1,600 82.86% 764 95.14% 773 96.26% 467 94.53% 466 94.33%
Data Warehousing – Financial 365 18.90% 427 22.11% 228 28.39% 276 34.37% 148 29.96% 173 35.02%
Data Warehousing/Mining – Clinical 281 14.55% 312 16.16% 189 23.54% 198 24.66% 134 27.13% 146 29.55%
DBMS 744 38.53% 866 44.85% 456 56.79% 524 65.26% 293 59.31% 332 67.21%
Dictation 1,464 75.82% 1,548 80.17% 746 92.90% 763 95.02% 452 91.50% 459 92.91%
Dictation with Speech Recognition 184 9.53% 218 11.29% 150 18.68% 181 22.54% 100 20.24% 132 26.72%
Document Management – Business Office 626 32.42% 753 39.00% 356 44.33% 432 53.80% 238 48.18% 281 56.88%
Document Management – HIM 727 37.65% 847 43.86% 447 55.67% 506 63.01% 283 57.29% 319 64.57%
Document Management – Human Resources 328 16.99% 363 18.80% 212 26.40% 208 25.90% 114 23.08% 130 26.32%
Electronic Data Interchange (EDI) –
Clearing House Vendor 1,004 51.99% 1,128 58.42% 484 60.27% 530 66.00% 301 60.93% 325 65.79%
Electronic Forms – Business Office 430 22.27% 517 26.77% 227 28.27% 274 34.12% 142 28.74% 169 34.21%
Electronic Forms – HIM 458 23.72% 552 28.59% 257 32.01% 319 39.73% 172 34.82% 210 42.51%
Electronic Forms – Human Resources 271 14.03% 307 15.90% 154 19.18% 177 22.04% 81 16.40% 99 20.04%
Eligibility 809 41.90% 917 47.49% 487 60.65% 520 64.76% 322 65.18% 338 68.42%
EMAR 786 40.70% 890 46.09% 453 56.41% 524 65.26% 305 61.74% 348 70.45%
Email 1,453 75.25% 1,709 88.50% 725 90.29% 773 96.26% 431 87.25% 467 94.53%
Emergency Department Information System (EDIS) 869 45.00% 972 50.34% 647 80.57% 676 84.18% 420 85.02% 436 88.26%
Encoder 1,664 86.17% 1,725 89.33% 795 99.00% 799 99.50% 485 98.18% 491 99.39%
Enterprise Master Person Index (EMPI) 566 29.31% 633 32.78% 334 41.59% 360 44.83% 220 44.53% 240 48.58%
Enterprise Resource Planning 214 11.08% 208 10.77% 144 17.93% 142 17.68% 125 25.30% 128 25.91%
Executive Information Systems 864 44.74% 947 49.04% 517 64.38% 520 64.76% 318 64.37% 330 66.80%
Financial Modeling 339 17.56% 399 20.66% 235 29.27% 246 30.64% 164 33.20% 180 36.44%
General Ledger 1,863 96.48% 1,915 99.17% 799 99.50% 803 100.00% 493 99.80% 494 100.00%
In-House Transcription 1,352 70.02% 1,429 74.00% 677 84.31% 662 82.44% 394 79.76% 391 79.15%
Intensive Care 602 31.18% 631 32.68% 425 52.93% 450 56.04% 288 58.30% 307 62.15%
Interface Engines 551 28.53% 638 33.04% 359 44.71% 436 54.30% 265 53.64% 296 59.92%
Laboratory Information System 1,715 88.81% 1,777 92.02% 801 99.75% 802 99.88% 493 99.80% 494 100.00%
Materials Management 1,701 88.09% 1,787 92.54% 795 99.00% 797 99.25% 493 99.80% 493 99.80%
Microbiology 963 49.87% 1,057 54.74% 691 86.05% 741 92.28% 448 90.69% 469 94.94%
Nurse Acuity 292 15.12% 311 16.11% 197 24.53% 212 26.40% 157 31.78% 164 33.20%
Nurse Staffing/ Scheduling 762 39.46% 780 40.39% 582 72.48% 585 72.85% 426 86.23% 431 87.25%
Nursing Documentation 942 48.78% 1,062 55.00% 543 67.62% 613 76.34% 346 70.04% 386 78.14%
Obstetrical Systems (Labor and Delivery) 461 23.87% 493 25.53% 426 53.05% 463 57.66% 268 54.25% 297 60.12%
Operating Room (Surgery) – Peri-Operative 619 32.06% 680 35.21% 514 64.01% 574 71.48% 354 71.66% 383 77.53%
Operating Room (Surgery) – Post-Operative 649 33.61% 701 36.30% 522 65.01% 581 72.35% 355 71.86% 381 77.13%
Operating Room (Surgery) – Pre-Operative 763 39.51% 783 40.55% 632 78.70% 646 80.45% 432 87.45% 433 87.65%

301–400 Beds 401–500 Beds 501–600 Beds 600+ Beds
2007 2008 2007 2008 2007 2008 2007 2008
% of 308 hospitals % of 308 hospitals % of 179 hospitals % of 179 hospitals % of 119 hospitals % of 119 hospitals % of 143 hospitals % of 143 hospitals
306 99.35% 306 99.35% 179 100.00% 179 100.00% 116 99.15% 116 99.15% 141 98.60% 142 99.30%
307 99.68% 308 100.00% 179 100.00% 179 100.00% 117 100.00% 117 100.00% 143 100.00% 143 100.00%
308 100.00% 308 100.00% 179 100.00% 179 100.00% 117 100.00% 116 99.15% 143 100.00% 143 100.00%
278 90.26% 286 92.86% 161 89.94% 167 93.30% 108 92.31% 114 97.44% 135 94.41% 138 96.50%
NA NA 78 25.32% NA NA 51 28.49% NA NA 37 31.62% NA NA 45 31.47%
302 98.05% 303 98.38% 176 98.32% 177 98.88% 114 97.44% 116 99.15% 140 97.90% 140 97.90%
291 94.48% 297 96.43% 168 93.85% 174 97.21% 112 95.73% 115 98.29% 136 95.10% 137 95.80%
278 90.26% 298 96.75% 155 86.59% 171 95.53% 109 93.16% 111 94.87% 129 90.21% 135 94.41%
280 90.91% 284 92.21% 165 92.18% 167 93.30% 112 95.73% 112 95.73% 134 93.71% 134 93.71%
107 34.74% 121 39.29% 56 31.28% 72 40.22% 43 36.75% 49 41.88% 45 31.47% 50 34.97%
149 48.38% 173 56.17% 91 50.84% 115 64.25% 79 67.52% 83 70.94% 77 53.85% 84 58.74%
84 27.27% 94 30.52% 60 33.52% 71 39.66% 53 45.30% 58 49.57% 49 34.27% 48 33.57%
129 41.88% 156 50.65% 83 46.37% 98 54.75% 72 61.54% 79 67.52% 72 50.35% 76 53.15%
81 26.30% 97 31.49% 54 30.17% 65 36.31% 50 42.74% 52 44.44% 47 32.87% 46 32.17%
78 25.32% 91 29.55% 50 27.93% 56 31.28% 51 43.59% 55 47.01% 42 29.37% 42 29.37%
216 70.13% 232 75.32% 139 77.65% 154 86.03% 95 81.20% 97 82.91% 116 81.12% 126 88.11%
276 89.61% 277 89.94% 167 93.30% 166 92.74% 101 86.32% 105 89.74% 135 94.41% 136 95.10%
306 99.35% 306 99.35% 178 99.44% 178 99.44% 116 99.15% 114 97.44% 142 99.30% 142 99.30%
305 99.03% 305 99.03% 176 98.32% 177 98.88% 114 97.44% 112 95.73% 142 99.30% 142 99.30%
284 92.21% 292 94.81% 167 93.30% 170 94.97% 113 96.58% 113 96.58% 139 97.20% 141 98.60%
239 77.60% 251 81.49% 143 79.89% 148 82.68% 100 85.47% 98 83.76% 120 83.92% 127 88.81%
181 58.77% 192 62.34% 109 60.89% 114 63.69% 91 77.78% 90 76.92% 98 68.53% 109 76.22%
235 76.30% 244 79.22% 147 82.12% 148 82.68% 93 79.49% 94 80.34% 116 81.12% 113 79.02%
258 83.77% 262 85.06% 155 86.59% 155 86.59% 101 86.32% 102 87.18% 132 92.31% 131 91.61%
286 92.86% 287 93.18% 171 95.53% 172 96.09% 110 94.02% 111 94.87% 133 93.01% 135 94.41%
117 37.99% 128 41.56% 78 43.58% 87 48.60% 47 40.17% 50 42.74% 62 43.36% 70 48.95%
88 28.57% 98 31.82% 51 28.49% 61 34.08% 35 29.91% 33 28.21% 53 37.06% 57 39.86%
199 64.61% 213 69.16% 109 60.89% 120 67.04% 82 70.09% 84 71.79% 100 69.93% 105 73.43%
283 91.88% 286 92.86% 167 93.30% 169 94.41% 107 91.45% 113 96.58% 136 95.10% 137 95.80%
75 24.35% 91 29.55% 52 29.05% 65 36.31% 40 34.19% 50 42.74% 50 34.97% 55 38.46%
156 50.65% 186 60.39% 88 49.16% 103 57.54% 65 55.56% 73 62.39% 79 55.24% 86 60.14%
195 63.31% 212 68.83% 119 66.48% 131 73.18% 82 70.09% 84 71.79% 91 63.64% 99 69.23%
83 26.95% 89 28.90% 48 26.82% 53 29.61% 38 32.48% 39 33.33% 34 23.78% 37 25.87%
200 64.94% 217 70.45% 107 59.78% 119 66.48% 71 60.68% 77 65.81% 100 69.93% 107 74.83%
105 34.09% 123 39.94% 53 29.61% 66 36.87% 35 29.91% 42 35.90% 34 23.78% 41 28.67%
105 34.09% 130 42.21% 56 31.28% 73 40.78% 46 39.32% 52 44.44% 48 33.57% 62 43.36%
59 19.16% 62 20.13% 30 16.76% 38 21.23% 26 22.22% 25 21.37% 19 13.29% 24 16.78%
189 61.36% 205 66.56% 118 65.92% 122 68.16% 80 68.38% 84 71.79% 102 71.33% 108 75.52%
222 72.08% 238 77.27% 125 69.83% 144 80.45% 100 85.47% 100 85.47% 94 65.73% 109 76.22%
283 91.88% 299 97.08% 163 91.06% 172 96.09% 109 93.16% 112 95.73% 126 88.11% 130 90.91%
250 81.17% 259 84.09% 144 80.45% 151 84.36% 106 90.60% 108 92.31% 125 87.41% 128 89.51%
308 100.00% 308 100.00% 179 100.00% 179 100.00% 116 99.15% 117 100.00% 143 100.00% 143 100.00%
142 46.10% 150 48.70% 84 46.93% 92 51.40% 54 46.15% 59 50.43% 80 55.94% 82 57.34%
84 27.27% 91 29.55% 46 25.70% 50 27.93% 44 37.61% 45 38.46% 45 31.47% 45 31.47%
200 64.94% 203 65.91% 113 63.13% 119 66.48% 76 64.96% 76 64.96% 100 69.93% 104 72.73%
110 35.71% 124 40.26% 64 35.75% 74 41.34% 43 36.75% 47 40.17% 58 40.56% 60 41.96%
308 100.00% 308 100.00% 179 100.00% 179 100.00% 117 100.00% 117 100.00% 143 100.00% 143 100.00%
259 84.09% 255 82.79% 146 81.56% 138 77.09% 88 75.21% 86 73.50% 120 83.92% 116 81.12%
175 56.82% 185 60.06% 111 62.01% 120 67.04% 78 66.67% 84 71.79% 96 67.13% 100 69.93%
196 63.64% 212 68.83% 113 63.13% 124 69.27% 85 72.65% 88 75.21% 100 69.93% 105 73.43%
308 100.00% 308 100.00% 179 100.00% 179 100.00% 117 100.00% 117 100.00% 143 100.00% 143 100.00%
307 99.68% 307 99.68% 179 100.00% 179 100.00% 117 100.00% 117 100.00% 143 100.00% 143 100.00%
284 92.21% 293 95.13% 168 93.85% 174 97.21% 111 94.87% 113 96.58% 135 94.41% 136 95.10%
79 25.65% 89 28.90% 69 38.55% 70 39.11% 36 30.77% 38 32.48% 52 36.36% 57 39.86%
260 84.42% 261 84.74% 164 91.62% 163 91.06% 107 91.45% 108 92.31% 129 90.21% 130 90.91%
223 72.40% 246 79.87% 135 75.42% 145 81.01% 96 82.05% 105 89.74% 108 75.52% 118 82.52%
207 67.21% 224 72.73% 122 68.16% 135 75.42% 85 72.65% 88 75.21% 101 70.63% 107 74.83%
234 75.97% 248 80.52% 136 75.98% 143 79.89% 99 84.62% 102 87.18% 118 82.52% 125 87.41%
227 73.70% 252 81.82% 136 75.98% 144 80.45% 94 80.34% 99 84.62% 116 81.12% 122 85.31%
273 88.64% 275 89.29% 163 91.06% 164 91.62% 110 94.02% 111 94.87% 129 90.21% 128 89.51%

 Appendix (con tinue d)
0–100 Beds 101–200 Beds 201–300 Beds
2007 2008 2007 2008 2007 2008
Applications % of 1,931 hospitals % of 1,931 hospitals % of 803 hospitals % of 803 hospitals % of 494 hospitals % of 494 hospitals
OR Scheduling 717 37.13% 785 40.65% 605 75.34% 657 81.82% 397 80.36% 428 86.64%
Order Entry 1,469 76.07% 1,532 79.34% 777 96.76% 776 96.64% 481 97.37% 486 98.38%
Outcomes and Quality Management 899 46.56% 969 50.18% 577 71.86% 601 74.84% 375 75.91% 396 80.16%
Outsourced Transcription 96 4.97% 126 6.53% 47 5.85% 76 9.46% 39 7.89% 53 10.73%
Patient Billing 1,848 95.70% 1,890 97.88% 800 99.63% 802 99.88% 493 99.80% 494 100.00%
Patient Scheduling 1,338 69.29% 1,610 83.38% 699 87.05% 752 93.65% 455 92.11% 474 95.95%
Payroll 1,801 93.27% 1,873 97.00% 797 99.25% 797 99.25% 489 98.99% 490 99.19%
Personnel Administration 1,336 69.19% 1,407 72.86% 772 96.14% 771 96.01% 486 98.38% 485 98.18%
Pharmacy Management System 1,585 82.08% 1,649 85.40% 798 99.38% 800 99.63% 491 99.39% 492 99.60%
Physician Documentation 548 28.38% 585 30.30% 322 40.10% 369 45.95% 227 45.95% 258 52.23%
Radiology – Angiography 670 34.70% 744 38.53% 557 69.36% 614 76.46% 394 79.76% 420 85.02%
Radiology – CR (Computed Radiography) 1,028 53.24% 1,208 62.56% 601 74.84% 670 83.44% 414 83.81% 437 88.46%
Radiology – CT (Computed Tomography) 1,029 53.29% 1,240 64.22% 608 75.72% 677 84.31% 421 85.22% 451 91.30%
Radiology – DF (Digital Fluoroscopy) 761 39.41% 901 46.66% 561 69.86% 628 78.21% 401 81.17% 428 86.64%
Radiology – Digital Mammography 266 13.78% 400 20.71% 217 27.02% 314 39.10% 171 34.62% 224 45.34%
Radiology – DR (Digital Radiography) 844 43.71% 995 51.53% 570 70.98% 627 78.08% 400 80.97% 429 86.84%
Radiology – MRI (Magnetic Resonance Imaging) 937 48.52% 1,093 56.60% 593 73.85% 663 82.57% 419 84.82% 448 90.69%
Radiology – Nuclear Medicine 808 41.84% 946 48.99% 581 72.35% 647 80.57% 400 80.97% 438 88.66%
Radiology – Orthopedic 254 13.15% 364 18.85% 181 22.54% 289 35.99% 130 26.32% 200 40.49%
Radiology – US (Ultrasound) 983 50.91% 1,167 60.44% 600 74.72% 666 82.94% 420 85.02% 451 91.30%
Radiology Information System 1,498 77.58% 1,599 82.81% 778 96.89% 780 97.14% 489 98.99% 489 98.99%
Respiratory Care Information System 409 21.18% 479 24.81% 285 35.49% 315 39.23% 184 37.25% 205 41.50%
RFID – Patient Tracking 49 2.54% 47 2.43% 32 3.99% 49 6.10% 27 5.47% 32 6.48%
RFID – Supply Tracking 41 2.12% NA NA 16 1.99% NA NA 20 4.05% NA NA
Single Sign-On 164 8.49% 229 11.86% 143 17.81% 203 25.28% 87 17.61% 120 24.29%
Staff Scheduling 421 21.80% 436 22.58% 333 41.47% 362 45.08% 242 48.99% 267 54.05%
Telemedicine – Radiology 619 32.06% NA NA 212 26.40% NA NA 146 29.55% NA NA
Time and Attendance 1,471 76.18% 1,602 82.96% 737 91.78% 759 94.52% 457 92.51% 468 94.74%
Turnkey Portal 145 7.51% 189 9.79% 106 13.20% 141 17.56% 94 19.03% 134 27.13%
Web Development Tool 625 32.37% 720 37.29% 319 39.73% 405 50.44% 204 41.30% 251 50.81%
0–100 Beds 101–200 Beds 201–300 Beds

2007 2008 2007 2008 2007 2008
Next Generation RCM % of 1,931 hospitals % of 1,931 hospitals % of 803 hospitals % of 803 hospitals % of 494 hospitals % of 494 hospitals
Biller’s Dash Board NA NA 147 7.61% NA NA 67 8.34% NA NA 54 10.93%
Claims Attachment Rules NA NA 107 5.54% NA NA 75 9.34% NA NA 62 12.55%
Claims Remittance Updates AR NA NA 95 4.92% NA NA 42 5.23% NA NA 40 8.01%
Denial Rules NA NA 112 5.80% NA NA 61 7.60% NA NA 53 10.73%
Direct Payer Claims NA NA 93 4.82% NA NA 33 4.11% NA NA 30 6.07%
EFT Transaction NA NA 146 7.56% NA NA 62 7.72% NA NA 50 10.12%
Eligibility Transaction with Payer NA NA 93 4.82% NA NA 48 5.98% NA NA 39 7.89%
EMR Documentation for Claims NA NA 62 3.21% NA NA 32 3.99% NA NA 34 6.88%
Necessity Alert @ Registration NA NA 128 6.63% NA NA 69 8.59% NA NA 57 11.54%
Necessity Alert @ Scheduling NA NA 115 5.96% NA NA 63 7.85% NA NA 52 10.53%
Web Preregister NA NA 140 7.25% NA NA 129 16.06% NA NA 98 19.84%
Web Schedule NA NA 52 2.69% NA NA 43 5.35% NA NA 60 12.15%
Web Self Pay NA NA 300 15.54% NA NA 214 26.65% NA NA 156 31.58%
A mbulat ory A mbulat ory

2007 2008 2007 2008
% of 15,146 % of 15,146 % of 1,898 % of 1,898
Ambulatory Facilities Ambulatory Facilities Ambulatory Facilities Ambulatory Facilities
Ambulatory EMR 6,841 45.17% 7,510 49.58% Ambulatory PACS* 937 32.08% 1,227 42.01%
Ambulatory Laboratory 2,327 15.36% 2,280 15.05% *Only includes ambulatory facilities doing imaging on site
Ambulatory Pharmacy 771 5.09% 707 4.67%
Ambulatory Radiology 2,161 14.27% 2,184 14.42%
Practice Management 14,634 96.62% 14,730 97.25%

2007 2008 2007 2008 2007 2008 2007 2008
271 87.99% 283 91.88% 159 88.83% 167 93.30% 110 94.02% 110 94.02% 122 85.31% 128 89.51%
302 98.05% 305 99.03% 175 97.77% 177 98.88% 117 100.00% 115 98.29% 142 99.30% 143 100.00%
228 74.03% 235 76.30% 143 79.89% 145 81.01% 84 71.79% 88 75.21% 119 83.22% 119 83.22%
24 7.79% 25 8.12% 21 11.73% 23 12.85% 13 11.11% 14 11.97% 26 18.18% 29 20.28%
308 100.00% 308 100.00% 179 100.00% 179 100.00% 117 100.00% 117 100.00% 143 100.00% 143 100.00%
279 90.58% 296 96.10% 164 91.62% 171 95.53% 113 96.58% 115 98.29% 135 94.41% 141 98.60%
308 100.00% 308 100.00% 178 99.44% 179 100.00% 117 100.00% 117 100.00% 143 100.00% 143 100.00%
305 99.03% 305 99.03% 177 98.88% 179 100.00% 116 99.15% 116 99.15% 143 100.00% 143 100.00%
308 100.00% 308 100.00% 179 100.00% 179 100.00% 117 100.00% 117 100.00% 143 100.00% 143 100.00%
140 45.45% 146 47.40% 85 47.49% 93 51.96% 68 58.12% 73 62.39% 79 55.24% 90 62.94%
262 85.06% 275 89.29% 160 89.39% 169 94.41% 115 98.29% 115 98.29% 133 93.01% 134 93.71%
273 88.64% 285 92.53% 164 91.62% 172 96.09% 116 99.15% 116 99.15% 136 95.10% 136 95.10%
276 89.61% 288 93.51% 167 93.30% 173 96.65% 117 100.00% 117 100.00% 137 95.80% 139 97.20%
261 84.74% 272 88.31% 159 88.83% 166 92.74% 114 97.44% 113 96.58% 132 92.31% 133 93.01%
124 40.26% 163 52.92% 74 41.34% 99 55.31% 53 45.30% 61 52.14% 70 48.95% 81 56.64%
268 87.01% 274 88.96% 156 87.15% 167 93.30% 113 96.58% 112 95.73% 132 92.31% 136 95.10%
274 88.96% 286 92.86% 166 92.74% 172 96.09% 117 100.00% 117 100.00% 136 95.10% 137 95.80%
267 86.69% 279 90.58% 162 90.50% 169 94.41% 113 96.58% 114 97.44% 132 92.31% 135 94.41%
86 27.92% 131 42.53% 53 29.61% 82 45.81% 38 32.48% 50 42.74% 61 42.66% 76 53.15%
275 89.29% 284 92.21% 164 91.62% 172 96.09% 113 96.58% 113 96.58% 134 93.71% 138 96.50%
304 98.70% 304 98.70% 178 99.44% 178 99.44% 117 100.00% 117 100.00% 142 99.30% 142 99.30%
112 36.36% 131 42.53% 69 38.55% 81 45.25% 53 45.30% 55 47.01% 68 47.55% 73 51.05%
23 7.47% 25 8.12% 8 4.47% 11 6.15% 9 7.69% 11 9.40% 20 13.99% 19 13.29%
18 5.84% NA NA 12 6.70% NA NA 3 2.56% NA NA 8 5.59% NA NA
66 21.43% 97 31.49% 30 16.76% 50 27.93% 25 21.37% 38 32.48% 34 23.78% 47 32.87%
157 50.97% 168 54.55% 88 49.16% 94 52.51% 60 51.28% 69 58.97% 88 61.54% 95 66.43%
95 30.84% NA NA 47 26.26% NA NA 26 22.22% NA NA 40 27.97% NA NA
292 94.81% 294 95.45% 172 96.09% 175 97.77% 114 97.44% 116 99.15% 135 94.41% 137 95.80%
72 23.38% 85 27.60% 45 25.14% 54 30.17% 27 23.08% 33 28.21% 28 19.58% 32 22.38%
138 44.81% 174 56.49% 91 50.84% 103 57.54% 56 47.86% 64 54.70% 82 57.34% 93 65.03%

2007 2008 2007 2008 2007 2008 2007 2008
Home He alth
2007 2008
% of 1,695 % of 1,695
Home Health Facilities Home Health Facilities
Home Health Administrative 1,581 93.49% 1,611 95.27%
Home Health Clinical 1,396 82.55% 1,425 84.27%

About HIMSS
The Healthcare Information and Management Systems Society (HIMSS) is the healthcare industry’s membership organization
exclusively focused on providing global leadership for the optimal use of healthcare information technology (IT) and management
systems for the betterment of healthcare. Founded in 1961 with offices in Chicago, Washington D.C., Brussels, Singapore,
and other locations across the United States, HIMSS represents more than 20,000 individual members and over 350 corporate
members that collectively represent organizations employing millions of people. HIMSS frames and leads healthcare public
policy and industry practices through its advocacy, educational and professional development initiatives designed to promote
information and management systems’ contributions to ensuring quality patient care.
About HIMSS Analy tics
HIMSS Analytics supports improved decision-making for healthcare organizations, healthcare IT companies and consulting firms
by delivering high quality data and analytical expertise. The company collects and analyzes healthcare organization data relating
to IT processes and environments, products, IS department composition and costs, IS department management metrics, healthcare
delivery trends and purchasing related decisions. HIMSS Analytics is a wholly-owned, not for profit subsidiary of HIMSS.
HIMSS Analytics HIMSS

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ISBN: 978-0-9800697-9-2
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This historical report

of the U.S. Hospital

An industry Report provided by

©2009 by the Healthcare Information and Management Systems Society.

Dear Healthcare Executive:

David E. Garets H. Stephen Lieber

Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 1

Obstacles are those frightful things you see when you

2 Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics.

Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 3

environments that are more “steady state” in their operations at the

The average IT operating expense, as a percentage of total hospital Ta ble HB5

4 Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics.

Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 5

Ta ble F M3 | Accounts Payable

Ta ble F M4 | Enterprise Resource Planning

Ta ble F M5 | General Ledger

Ta ble F M6 | Materials Management

6 Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics.

Ta ble F M12 Ta ble F M15

Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 7

 Financial Decision Support Environment

8 Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics.

Ta ble F DS 4 | Business Intelligence

Ta ble F DS 5 | Cost Accounting

Ta ble F DS6 | Data Warehousing – Financial

Ta ble F DS7 | Executive Information Systems

Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 9

An analysis of the financial decision support market by bed-size Ta ble F ds12

with 0 to 100 beds.

• Executive information systems: growth of approximately four

10 Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics.

Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 11

Ta ble HR4 | Payroll

Ta ble HR5 | Personnel Administration

Ta ble HR6 | Time & Attendance

12 Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics.

Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 13

over year (see Table RCM1).

Ta ble rcm2 | 2008

14 Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics.

Ta ble RCM4 | Bed Management

Ta ble RCM5 | Contract Management

Ta ble RCM6 | Credit/Collections

Ta ble RCM7 | EDI – Clearing House Vendor

Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 15

Ta ble RCM9 | Enterprise Master Person Index

Ta ble RCM10 | Patient Billing

Ta ble RCM11 | Patient Scheduling

16 Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics.

• The bed management market shows that hospitals with more

is only 50 percent penetrated in the over 400 bed market.

Ta ble rcm12 Ta ble rcm17

Ta ble rcm13 Ta ble rcm18

Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 17

18 Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics.

Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 19

Ta ble NGRCM3 | Web Schedule Ta ble NGRCM8 | Denial Rules

Ta ble NGRCM4 | Web Self Pay Ta ble NGRCM9 | Biller’s Dashboard

20 Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics.

Source: HIMSS Analytics™ Database 2008 ©2009 HIMSS Analytics. 21

 Health Information Management

solutions for this application become more competitive and more