Azron goes under
Anatomy of an EMR company’s failure
By ARTHUR GASCH
Healthcare InfoTech Contributing Editor
A look at the aftermath of an informatics company failure may help industry watchers learn about what went wrong, and how it might go right in the future. The company is Azron Corp. (Berwyn, IL, formerly of La Jolla, CA), a timely choice as this week marks the closing of the doors of this once-promising and upcoming electronic medical record (EMR) vendor.
It appeared that Azron had everything going for it. Its web site even referred to an "award-winning EMR." In 1995, Azron won the "Most Innovative New Product Award," based on the revolutionary design of Azron EMR, the company’s electronic medical record system. In 1996, MacNeal Health Network was honored with the Health Data Management Innovators Award for application of electronic medical records through the Azron system.
The Azron EMR was a flexible electronic medical records system that could be accessed using wireless, pen-based mobile computing technology. Azron was a proponent of paperless electronic medical record technology. Azron was on the politically correct Windows NT platform, and was a built-from-scratch implementation rather than a remake of an older DOS application transplanted into the Windows environment. If you believed what you read, Azron should have had a large and growing market share by now, but something went wrong. In spite of all the accolades, as of this week, the company is no longer in business, leaving its partner and investor MacNeal Health Network (Chicago) with one last release of the software, and presumably the source code.
MacNeal Health Network, which includes 29 care centers, was the largest user of the Azron system. As of February 1998, 10 members had employed the Azron EMR. Two of those 10 were paperless from the start; three others had gone paperless since the system was installed. The MacNeal electronic medical record system was based on Azron’s wireless mobile electronic medical record system. The most important criteria for the award was the ability to demonstrate tangible evidence of how an electronic patient record system lowered the cost and increased quality of care. Azron also had an attractive web site that presented good graphics design as well as a user-friendly atmosphere. But do busy office doctors spend much time looking for office EMR systems on the web, or anywhere else for that matter? At MacNeal, more than 200 clinicians and staff members used the system each day, maintaining the charts of more than 85,000 patients in a wide range of other clinical environments. How Azron’s failure will affect these operations is a question we tried to ask Stratis Bahaveolas, Azron vice president and McNeal liaison, but at press time he had not returned our calls. MacNeal has a 427-bed hospital, more than 30 healthcare centers, more than 500 physicians, home health and behavioral health services, along with offering a complete range of specialty services. So the company had a vision, one that the people at MacNeal believed was solid enough to implement across almost half of their hospitals and clinics. Enough to finan cially support Azron’s product development.
So why did Azron fail? It wasn’t because Azron was a technology laggard the company had one of the latest and greatest of systems. In addition to being wireless, Azron was Windows NT-based open architecture, electronic interface to lab results and transcription reports, centralized file servers, and multiple wide area network link options connecting the centralized computer room and practice locations, i.e., point-to-point T1, VPN via the Internet. As recently as April, Azron was announcing that physicians could access medical records at the point of care via the company’s wireless, mobile technology. Azron used the Internet to offer a semi-painless solution for physicians. The idea was to eliminate the paper-based patient chart in the physician office by providing electronic handling of all patient and clinical information through one intuitive, efficient, integrated and secure system. The theory is apparently sound, as it is the same approach that MedicaLogic has announced (with Logician Internet) and is now moving implementing to its client base. But is even that enough, now that WebMD and Healtheon are entering the Internet arena with a $6.5 billion bang that accesses 40,000 MDs and 200,000 consumers (and potential patients)?
Azron’s demise began to become apparent about a year ago when one of the principals left the company. This was a sign that all was not well. So was the demise of its marketing relationship with MedPlus Inc. (Cincinnati), which Azron had signed up to provide a repository for its records. The deal was cut based on volume assumptions that apparently never materialized. One reason cited for Azron’s failure was the distraction caused by the healthcare industry attending to Y2K issues. Azron’s Alan Bonotane said the feeling was that Y2K caused a delay in interest in new systems because of cash flow and that interest had simply dried up. We have heard this lament from other vendors in the industry over the past year, but this is the first company that we know of to attribute its demise to Y2K. It seems to have particularly hit companies without legacy systems that are not Y2K-compliant. The companies with the older, non-compliant applications have been taking in bundles to upgrade and fix them, to the detriment of newer companies with more innovative products that didn’t need fixing. Seems ironic: May the worst products win!
Bonotane also said that hospital and MD practice personnel have been reluctant because he felt that there were "too many choices" of systems, each with some feature they wanted, but none that offered them all in one ideal system. He said that every vendor had something to offer that was a little unique and special. But he also said that no one company had everything that those seeking an information system wanted and needed. Indeed, there are too many choices, some 1,800 companies offering parts, most of which simply don’t fit together very well, and which don't provide one seamless solution to any of the problems a clinician deals with every day. Who can be aware of all these systems, much less know much of anything about them? How is a doctor, busy seeing patients, paying bills, managing his practice, ever going to learn about any large percentage of these systems? After all, Azron had the press, the awards, the citations and appeared in all the surveys, and yet, if you ask 50 doctors at random in Texas, California, Georgia and New Hampshire what an "Azron" is, and what features it had, who would know?
Azron is an excellent solution, but is it a solution to the right problem? In light of the current status of the electronic medical record i.e., "not any further advanced than early stages of development after a decade of system development," according to the TEPR (Toward an Electronic Patient Record) organization at its 1999 conference this is a very relevant question. In watching this industry closely, we believe there are a number of serious, hidden issues/needs/problems that have not yet been solved. If the market for these products is ever to progress beyond the "early adopter" stage, they will either have to be addressed, or alternately the government in its profound wisdom can simply legislate requirements that absolutely mandate a computerized solution, and doctors will then be forced into buying something, whether it works or not. What are these problems?
Whether Bill Gates or the sales force from any system vendor want to admit it or not, using an office full of computers, no matter how they are networked, is a thought that strikes fear and caution into the heart of any doctor. Doesn’t matter if they are computer gurus and some are it is their office staff that also has to make it work, and that staff operates at quite a different level of computer expertise. They are user-oriented, not problem/troubleshooter oriented. If something doesn’t work, they go to the doctor, to see what to do, or they call the vendor, who for 18% a year, will come out when they get to it and get the practice back online.
While computers have improved in terms of their GUIs, and are now "point and click" optimized, there is still nothing simple about setting up, shaking out the bugs, and maintaining a computer network, particularly if it mixes wired and wireless LANs. I know it, you know it, our doctors know it, and maybe in his nightmares, even Bill Gates knows it. Moreover, it isn’t likely to change anytime soon.
Windows NT 2000 (judging from Beta 3, iteration 2031) isn’t the answer. It’s better (if it works) than Windows NT 4 or 98, but it’s only an incremental improvement, and what is needed is a quantum leap. Windows NT 2000 is not a quantum leap in spite of the marketing hype out of Redmond, WA. Even farther behind is Unix in any flavor, including the increasingly popular RedHat 5.2 version. Yes, it’s better than Solaris, HP-UX, FreeBSD, etc., in terms of usability, and configurability by non-geeks, but it’s light years away from friendly and usable, and there aren’t too many medical applications written for it, thanks to the Microsoft monopoly on desktop operating systems, which drives the software application industry. The truth is, there is nothing out there that approaches a complete solution that is easy to use, reliable, or simple to troubleshoot and there isn’t likely to be anything, anytime soon. Layering on the Internet, which I think is a good idea, just complicates matters more, particularly security, reliability and response-time issues.
What this means is that the average doctor isn’t going to be real comfortable with the integrated computer networked office as a tool that is as simple to use, reliable, and ubiquitous as his or her stethoscope or sphygmomanometer. Therefore, doctors are going to be cautious, reluctant adopters of this technology in providing patient care, no matter how many awards, articles, comparison charts they receive or hear about. These help, but the underlying fear and caution are unresolved factors dampening the adoption of this technology, and the broader implementation of this para digm shift.
Doctors don’t care about Gigahertz, Megahertz, and whether it’s the hard disk that is 6 "Giga-something" or is that the processor speed? They care about seeing patients faster, having more information at hand, and not having trouble using something that is becoming more essential to their daily practice. The focus is on information transport and not the vehicle that carries it. Consider an analogy a technology that has become ubiquitous the telephone. When you pick up a telephone, you talk you don’t perform system or software updates on the phone, or care about what chips are inside, or whether it has embedded Windows CE and will work with the next release of the software running on the Bell central office. Bell worries about that stuff. If the phone rings when you dial the number, and you can talk, it’s a good phone. You may use one from AT&T, or Bell Atlantic, or GE, or Radio Shack or all of the above in the same day because they all plug into the same outlet, and they all perform the same basic tasks reasonably well, and you aren’t too concerned that you better make a call on the phone in the kitchen rather than the one in the basement, which is "harder" to use.
Unfortunately, computer vendors and the government haven’t gotten this message yet. Standardize the transactions, standardize the protocols used by the transactions, standardize the information required to care for patients, and the solutions offered by the various vendors will suddenly be easier to use, more reliable, simpler to install, and more people will use them willingly, not reluctantly. This will cause the market explosion that cash-starved vendors have prayed for, and keep a few more of them in business and growing.
Azron is only one of an ongoing number of failures in the market, and it failed due to marketing and product concept flaws. It was an excellent solution to only part of the problem, leaving many user fears unaddressed, and never garnering a critical mass of sales. The market is poorer for its demise. It leaves behind even less-ideal solutions from older companies, which have been rebaked and rebaked to the point that they are like Aunt Millie’s biscuits from last Thanksgiving. They look like biscuits, but they don’t taste much like biscuits, and not too many people who take one come back for seconds.
What is needed is some new thinking. Indeed, Healtheon and WebMD, as well as MedicaLogic, may be on the right track. Offer services that doctors need. Leave the hardware, nibbles and bytes to your dog, get it out of the equation. Keep the technology intrusion into the MD practice setting as minimal as possible.
Focus on a few, essential tasks, do them well, and manage them transparently, behind the user's back. Make the tool useful, reliable, provide a backup tool when it doesn’t work, so the practice of medicine like the Broadway show can go on, unabated by mere mechanical, electrical, network problems and glitches.
What this sounds like is an outsourced solution with some in-house, front-end hardware. Indeed, companies like Shared Medical Systems (Malvern, PA) that have core competency in outsourcing have been doing very well, even without cooking their books. It sounds like a Healtheon-Web MD solution, that exploits the Internet as a back end, not a real-time part of the information flow solution. It sounds like some yet-to-be-announced competitive system to these formidable offering, but it doesn't sound like Azron, or Picis, or any of a hundred other vendors offering a GUI, Windows NT or CE gizmos with a twist or two to their medical office or point-of-care CPR applications. These "solutions" all leave the physician right in the middle of a convergence of technologies and information systems that he or she has never been anxious to configure, manage, support or troubleshoot. It’s a place where practitioners don’t want to be, and they have been telling the market that for a decade now. Is anybody listening?
This is not to count Azron completely out. Who knows, perhaps like Healthmatics before it, Azron will rise from its own ashes and reappear in a new guise under different corporate ownership, perhaps a company with an older product line, but lots of service contract customers and "seats" to distribute this product to. Maybe HBOC can buy it and book another $30 million in partially completed installation revenues. But even if Azron does arise, the hidden and underlying issues in the market will need to be addressed before very many vendors achieve financial success in penetrating the sea of reluctant adopters and pragmatists which make up the remaining provider community that is the market for electronic point-of-care computerized medical records systems.
Arthur Gasch is president of Medical Strategic Planning, a Lincroft, NJ, firm specializing in market research, strategic and tactical corporate planning, and private market research. He is a regular contributor to many American Health Consultants publications. He can be reached at (732) 219-5090 or www.medsp.com or [email protected].
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