Making the Most of Digitized Healthcare Data

TBRT ECH N O LO G Y B U SIN ESS RESEARCH , IN C.
Making the most of digitized healthcare
Insights from TBR’s 1Q14 Healthcare IT Services Benchmark
July 17, 2014

TBR
2 TBR HITS Benchmark Webinar | 1Q14 | www.tbri.com | ©2014 Technology Business Research Inc.
Healthcare IT Services Quarterly Benchmark Readout: Presenter
Joseph Walent
Lead Analyst, Healthcare IT Services
Professional Services Practice
Email: joseph.walent@tbri.com
Twitter: @JDWalent

TBR
TBR’s healthcare IT services reports deliver unique insight and value
through in-depth analysis in a concise, consumable format
TBR Healthcare IT Services Overview
Clients gain advantages and a better understanding of revenue opportunities through our reports
and their personal relationships with TBR
• TBR continually covers 20 vendors in its Healthcare IT Services Benchmark.
• Of those vendors, we publish five healthcare IT services (HITS) company reports, focusing on the
HITS businesses of Accenture, CSC, Dell Services, HP Services and IBM Global Services.
• The healthcare activities of eight other firms are covered in TBR’s overall IT services quarterly and
semiannual reports on CGI, Cognizant, Deloitte, General Dynamics, HCL, Infosys, Leidos and Xerox.
• TBR’s Healthcare IT Services Benchmark includes the activities of Allscripts, Cerner, CPSI, Epic,
Harris, McKesson and NextGen.
o TBR reports are unique due to their deep, holistic analysis of leading vendor businesses.
o Financial modeling and TBR insights help customers build a better understanding of vendor
business models.
o TBR reports and webinars are designed to be responsive to client time lines, to be clear and
concise, and to provide insights across multiple layers of an organization.
o TBR’s strategic assessment provides an impartial reality check on how vendors are performing in
their strategic objectives and the overall market.

TBR
Healthcare IT Services Quarterly Benchmark Readout: Agenda and Format
Today’s Agenda
1. Key fiscal results from the 1Q14 benchmark
2. Strategic actions: M&As, alliances, portfolios
3. Where is the market headed? 2014 outlook
4. Q&A

TBR
Healthcare IT Services Quarterly Benchmark Research Highlights
Healthcare IT Services Benchmark Highlights for 1Q14
Balancing portfolios: M&As, alliances, internal
Around the bend: HITS market focus areas
Solid vertical demand: Recent fiscal results
Continued evolution of demand in the various segments of the HITS
marketplace expanded the scope of opportunities for vendors in 1Q14
SOURCE: WWW.THINKWITHGOOGLE.COM
SOURCE: WWW.INETU.NET
SOURCE: WWW.TREKEARTH.COM

TBR
The healthcare provider segment will remain the central revenue engine in the majority
of HITS vendors’ business models in 2014
Declining federal subsidies for IT implementation in healthcare
contributed to softening demand for HITS solutions
8.8% 8.9%
8.6%
8.0%
6.0%
9.7% 9.3% 9.4%
8.6%
7.9%
0%
2%
4%
6%
8%
10%
12%
1Q13 2Q13 3Q13 4Q13 1Q14
Growth%
Calendar Quarter
Average Growth (YTY TTM Revenue & YTY Quarterly Revenue)
for HITS Vendors
Average YTY Growth Average TTM YTY Growth
TBR
SOURCE: TBR ESTIMATES AND COMPANYDATA

TBR
A maturing market encouraged HITS vendors to develop and implement mission-specific
solutions to secure market share
Vendors that focused on niche HITS solution delivery fared better than
their generalist counterparts in 1Q14
Accenture CGI
Cognizant
Harris
Cerner
Allscripts
Infosys
Leidos
Deloitte Epic
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
-20% -10% 0% 10% 20% 30% 40%
OperatingMarginTTM
Healthcare IT Services Revenue TTM Growth YTY
1Q14 HITS TTM Operating Margin and Revenue Growth
NOTE: SPHERESIZEREFLECTS VOLUMEOF REVENUE.
TBR
9.4% Avg. Healthcare IT Vendor TTM Growth YTY
13.2% Avg. Healthcare IT Vendor TTM Operating Margin

TBR
HITS revenue growth leaders are expanding their presence in new
segments and pursuing international opportunities to drive growth
Healthcare IT Services TTM Revenue Growth Leaders in 1Q14
• Logica acquisition masked the negative impact of loss of HealthCare.gov and
Massachusetts Health Connector engagements.
• Opportunities captured in Europe offset setbacks in the U.S. public sector.
• Focus on systems for large-scale U.S. provider market continued to generate
leading growth rates.
• Expanded presence in federal and consumer healthcare IT markets in 1Q14.
26.3% in 1Q14
25.7% in 1Q14
29.9% in 1Q14
• Internal development of proprietary solutions for business process
outsourcing (BPO) and IT outsourcing (ITO)
• Aggressive pursuit of engagements in public sector, payer and life sciences
segments
Other vendor revenue growth leaders in 1Q14: Deloitte (23.1%), Cognizant (19.9%), Cerner (17.7%)
Infosys
CGI
Epic

TBR
HITS operating margin leaders employed a variety of strategies to secure
top spots for profitability
Healthcare IT Services Operating Margin Leaders in 1Q14
• Expanding offshore labor pools
• Introduction of automated service delivery to maximize resource utilization
• Near-exclusive focus on the small and midsize provider community
combined with efficient use of technology helped preserve profits.
• Expiration of federal incentive payments for HITS adoption will weigh on
CPSI’s business in coming quarters.
25.6% in 1Q14
23% in 1Q14
24.7% in 1Q14
• Strong market position with premium price points coupled with exclusivity
on customization of systems
• Leverage of C&SI firms for lower-value implementation and integration work
• Epic’s push to generate additional analytical insights for clients will increase
value and improve profitability.
Other operating margin leaders in 1Q14: Cerner (22.3%), Cognizant (19.4%), Infosys (17.8%)
HCLT
Epic
CPSI

TBR
HITS vendors are adjusting their offerings as healthcare industry clients
widen their use of IT-enabled solutions
Healthcare IT Services Segment Trends in 1Q14
Payer: HITS vendors are supporting payer clients with patient engagement
solutions such as patient portals and population health management tools
that help members make positive healthcare decisions.
Provider: Healthcare providers are moving to a collaborative healthcare
system where IT system interoperability is critical to improving quality of
care and patient outcomes.
Life Sciences: Life sciences IT vendors are generating analytics offerings that
provide capabilities to help drive insights around drug discovery or
biological manufacturing.
Federal: Growth of the federal healthcare segment decelerated as financial
outlays for the implementation of the Affordable Care Act (ACA)-mandated
health insurance exchanges diminished.
State and Local: As part of the ACA, states are revamping Medicaid
Information Management Systems, creating opportunities for vendors such as
Xerox and HP.
SOURCE: WWW.DAC-LAW.COM
SOURCE: WWW. CPRNETWORK.CA
SOURCE: WWW. XCONOMY.COM
SOURCE: WWW. OCCASIONALPLANET.COM

TBR
Balancing portfolios: M&As, alliances, internal
Broader access to HITS solutions affords HITS vendors opportunity
to secure wallet share from clients

TBR
Gaining IP to facilitate the delivery of a wider range of HITS services and
capabilities influenced 1Q14 acquisitions
Healthcare IT Services Vendors: Key Mergers and Acquisitions in 1Q14
Cloudant: As healthcare becomes increasingly personalized, access to
Cloudant’s Database as a Service (DBaaS) capabilities will provide IBM GS
an attractive offering that caters to developers creating mobile and Web
apps.
ISG Holdings: Xerox’s acquisition of ISG’s established medical bill review,
care management services and analytics solutions will enhance Xerox’s
healthcare provider BPO portfolio.
Xerox
IBM

TBR
HITS vendors engaged in alliances to deepen portfolios and extend
market reach
Healthcare IT Services Vendors: Key Alliances and Partnerships in 1Q14
Texas A&M Health Science Center: Dell and Texas A&M partnered to
create a health technology academy that will provide healthcare
professionals specialized information technology education.
Amazon Web Services: The partnership will result in the development
of healthcare cloud solutions that leverage Amazon’s public cloud
offerings and CSC’s cybersecurity, cloud management and electronic
health record (EHR) system integration capabilities.
Apple: Epic’s MyChart will integrate with Apple’s HealthKit, allowing
consumers to feed their biometric information into the application,
increasing Epic’s direct exposure to the healthcare consumer.
CSC
Dell
Services
Epic

TBR
Healthcare IT services vendors focused internal development efforts on
improving efficiency and security of healthcare organization operations
Healthcare IT Services Vendors: Key Service Announcements in 1Q14
FusionFX: Harris released its long-awaited EHR integration
platform enabling the efficient exchange of patient
information through its patient portal interface.
ConvergeHealth: Deloitte launched a transformational
business unit focused on delivery of outcome-based solutions
by providing data-driven consulting services.
Managed Mobile Services: The expansion of McKesson’s HITS
portfolio to include a mobile device management solution
addresses the security concerns of provider IT departments that
are stretched thin.
Deloitte
Harris
McKesson

TBR
Balancing portfolios: M&A, alliances, internal
Changes in how healthcare is delivered and results are measured will
spur solution development for HITS vendors in 2014

TBR
Healthcare IT Services Vendor Trends for 2014 — Patient Engagement
HITS vendors will enhance patient and member communication solutions
to deliver more personalized medical treatment
Challenges
• Shift to outcome-based remuneration, placing more
risk with providers.
• Personalization of healthcare plans and strategies
requires flexibility and interoperability in healthcare
data exchange.
Opportunity
• HITS vendors with experience in development and
implementation of retail customer contact solutions
will translate offerings to healthcare patient case
management strategies and solutions.
• Integration of security within solutions across platforms
and access points will stand out in the marketplace.
SOURCE: WWW.SNAPCOMMS.COM

TBR
Healthcare IT Services Vendor Trends for 2014 — Convergence and Consolidation
Expanding regulatory requirements and demand for more coordinated
care are changing the payer and provider landscape
Challenges
• Expansion of the payer and provider model across
various states with varying insurance regulatory
structures and requirements
• Maintaining protected health information (PHI) while
simultaneously improving information liquidity
Opportunity
• Consumer-oriented healthcare delivery will encourage
leverage of economies of scale.
• Improved population health data enables improved
preventive healthcare delivery.
• Solutions limiting internal sharing of certain healthcare
data in converged organizations
SOURCE: WWW.WORKLIFECHAMPIONS.COM.AU

TBR
Healthcare IT Services Vendor Trends for 2014 — Management of Chronic Conditions
Solutions for managing secure communication across accountable care
organizations will be in demand from HITS vendors in 2014
Challenges
• Chronic conditions such as diabetes, asthma and
heart disease consume the majority of healthcare
delivery spend globally.
• Expansion of healthcare coverage in the U.S.
increases demand for healthcare infrastructure for
chronic condition management.
Opportunity
• Development and implementation of remote
monitoring and telemedicine delivery capabilities via
cloud and mobility solutions
• Vendors with international HITS delivery have greater
exposure to in-home medical delivery models
effective in chronic condition management.
SOURCE: WWW.DIABETESMINE.COM

TBR
Questions?
Healthcare IT Services Quarterly Benchmark Research: Questions

TBR
Joseph Walent
Lead Analyst, Healthcare IT Services
Professional Services Practice
Email: joseph.walent@tbri.com
Twitter: @JDWalent
James McIlroy
Vice President of Sales
Email: mcilroy@tbri.com
Telephone: 603.929.1166
Twitter: @TBRinc
SlideShare: www.slideshare.net/TBR_Market_Insight
YouTube: www.youtube.com/user/TBRIChannel
LinkedIn: www.linkedin.com/company/technology-business-research
Healthcare IT Services Quarterly Benchmark Research: Contact Information

TBR
Healthcare IT Services Quarterly Benchmark Research: Appendix
Accenture CGI
Cognizant
CSC
Harris
CernerIBM GS
HP Services
Allscripts
Infosys
Dell Services
Xerox
Leidos
NextGen
McKesson
Deloitte
General Dynamics
Epic
HCL
CPSI
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
-20% -10% 0% 10% 20% 30% 40%
OperatingMarginTTM
Healthcare IT Services Revenue TTM Growth YTY
1Q14 HITS TTM Operating Margin and Revenue Growth
NOTE: SPHERESIZEREFLECTS VOLUMEOF REVENUE.
TBR
9.4% Avg. Healthcare IT Vendor TTM Growth YTY
13.2% Avg. Healthcare IT Vendor TTM Operating Margin

TBR
PSP Syndicated Research Coverage
IT Services Vendors Public Sector Vendors Benchmarks
(Benchmark XLS data also available)
• Accenture
• Atos
• Capgemini
• CGI*
• Cisco Services
• Cognizant
• CSC
• Dell Services
• Fujitsu
• HCL Technologies
• HP Services
• IBM Global Services
• Infosys
• T-Systems
• Tata Consultancy Services
• Unisys
• Wipro IT Services
• Xerox Services
• Booz Allen Hamilton*
• CACI International*
• General Dynamics IS&T*
• L-3 Communications*
• Leidos*
• Lockheed Martin IS&GS*
• ManTech*
• Northrop Grumman IS&TS*
• Raytheon Intelligence, Information & Services*
• SAIC*
• Global Delivery Market Landscape
• Healthcare IT Services Vendor Benchmark
• IT Services Vendor Benchmark
• Management Consulting Benchmark
• Public Sector IT Services Vendor
Benchmark
• Software Alliance Benchmark
Healthcare IT Services Vendors
• Accenture HITS*
• CSC HITS*
• Dell HITS*
• HP HITS*
• IBM HITS*
Management Consulting Vendors
• Bain & Company*
• Booz & Company*
• Boston Consulting Group*
• Deloitte Consulting*
• McKinsey & Co.*
TBR Professional Services Practice Syndicated Coverage
*Semiannual publication

About Us
Technology Business Research, Inc. is a leading independent technology
market research and consulting firm specializing in the business and financial
analyses of hardware, software, professional services, telecom and
enterprise network vendors, and operators.
Serving a global clientele, TBR provides timely and actionable market
research and business intelligence in formats that are tailored to clients’
needs. Our analysts are available to further address client-specific issues or
information needs on an inquiry or proprietary consulting basis.
TBR has been empowering corporate decision makers since 1996.
To learn how our analysts can address your unique business needs, please
visit our website or contact us today.
Contact Us
1.603.929.1166
info@tbri.com
www.tbri.com
11 Merrill Drive
Hampton, NH 03842
USA
This report is based on information made available to the public by the vendor and other public sources. No representation is made that this information is accurate or complete. Technology Business
Research will not be held liable or responsible for any decisions that are made based on this information. The information contained in this report and all other TBR products is not and should not be
construed to be investment advice. TBR does not make any recommendations or provide any advice regarding the value, purchase, sale or retention of securities. This report is copyright-protected and
supplied for the sole use of the recipient. Contact ©Technology Business Research, Inc. for permission to reproduce.

Making the Most of Digitized Healthcare Data

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Empfohlen

Empfohlen (20)

Making the Most of Digitized Healthcare Data