Consolidation and more consolidation

Remember VitalWorks? It's now part of Cerner. Per-Se Technologies? MercuryMD? Bought by Micromedex, which since has become part of Thomson Reuters. Other names that have disappeared from the marketplace in the last 10 years include Shared Medical Systems, A4 Health Systems, Misys Healthcare Systems, Millbrook, NDCHealth, Azyxxi, VantageMed, Wellink, MediNotes, Payerpath, Quality Care Solutions, RxHub and Medem. Earlier this month, Sentillion agreed to a takeover by Microsoft.

Yes, health IT was an immature industry in 2000, particularly in terms of clinical information systems. And as industries mature, they go through consolidation. Health IT had several phases of consolidation this decade.

First, there was the dot-com bubble that put good products into bankruptcy. GE Healthcare acquired MedicaLogic's Logician this way. The trend toward integrated management and clinical systems led to more mergers and acquisitions as vendors wanted to be able to offer an integrated product. Picis bought Lynx Medical Systems in 2007 for this purpose. Certification of electronic medical records, which began in 2006, created more M&A activity, as did the desire to offer products for a wider range of customers.

The credit crunch and financial meltdown toward the end of the decade affected the health IT market, too. First, poor sales led to a breakup of Misys Healthcare Systems in 2007, then Allscripts had to delay its acquisition of the ambulatory assets of Misys in 2008 due to the collapse of Lehman Brothers, which helped finance the deal.

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