Competitive Analysis Report

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JEWSON ENTERPRISES

INTERNET-BASED POMIS REPORTS

Competitive Analysis Report

By Vinson J. Hudson

POMIS Analyst

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POMIS Forecast Performance

Source: Jewson Enterprises’ POMIS Knowledge Base

Company Profile

Jewson Enterprises is a physician’s office management & medical information systems (POMIS) market research and analysis firm that specializes in performing competitive intelligence gathering of information; interpretations, insights, and impressions about the performance of EHR-EMR & PM solutions companies, providing actionable reports and

discussions: Competitive Analysis Report, Performance Ratings Trust Exchange Reports, and custom private reports.

Dec Jan Aug Dec Jan Aug Dec Jan Aug Dec Jan Aug Dec Jan Aug Dec

2013 2014 2015 2016 2017 2018 Billions 10.93 11.00 11.40 11.80 12.90 14.60 15.30 15.60 15.80 16.30 16.80 17.90 18.40 18.30 18.00 17.60 0.00 4.00 8.00 12.00 16.00 20.00 Billions Consolidation Triggers Demand to Meet MU Stages Resourcer-Intensive Sales Innovations in Cloud-Basecd Delivery Decline of Legacy POMIS

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COMPETITIVE ANALYSIS

INTRODUCTION

Competitor identification is a key task for your managers and executives interested in scanning the crowd competitive terrain, shoring up their defenses against likely competitive incursions, and planning competitive attack and response strategies. Before you can assess the relative strengths and weaknesses of rival competitors, you must first identify the competitive group and develop an accurate sense of the domain in which strategic interactions are likely to occur.

Although we do an excellent job of investigating POMIS vendors, we focus on the role of customer provider needs in defining the marketplace to show how a greater recognition of provider needs can expand awareness of what lurks on the competitive horizon. We compare your rivals on the bases of relevant dimensions,.

This document focuses on administrative, financial, and clinical systems vendors, called:  Client-Server Systems Vendors,

 Medical Billing Services Vendors, and

 Cloud-based vendors.

EHR-EMR solutions and practice management systems (PMS) are primarily analyzed. Included are managed care information systems (MCIS) vendors. The results reflect information from the

marketplace of reliable sources. Although the POMIS Vendor Database monitors more than 600 vendors, this competitive analysis focuses on the leading 100 vendors holding 87.0% share of the industry. These vendors are compared by several factors of market performance. Details of other competing vendors are provided in the POMIS Vendor Database as a Microsoft Access RDBMS. Vendors used had revenues greater than $200,000 and active in business. These vendors include: traditional practice management solutions, EHR-EMR solutions, and managed care information systems vendors in ambulatory care settings.

The total revenues of each vendor are estimated. Some vendors offer hospital information systems (HIS). That part of the business is excluded in the revenue analysis of this report.

THE POMIS INDUSTRY

The POMIS industry is engaged in management and medical information technologies assembled or produced by computer systems and services companies that are sold physician organizations, including

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implementation, training, and ongoing support. POMIS targets the performance of companies or vendors that make this transaction complete.

POMIS VENDORS

 Number of Vendors: 614 as of June 14, 2014  Revenues: $10,933.2 million

 Ownership: Publicly held and privately held companies

 Major Products: Electronic Health Records-Electronic Medical Records (EHR-EMR) systems; managed care information systems (MCIS); and practice management systems (PMS)

 Deployment Methods: Client-server systems; medical billing services; and Cloud-based providers  Customer Targets:

o Solo & 2-physicians

o Medical group practices – practice size, multi-specialties, integrated health networks, and single-specialties, such as primary care (e.g., General/Family practice, Internal Medicine, Pediatrics, Obstetrics/Gynecology, Anesthesiology, Cardiovascular Surgery, Emergency Medicine, General Surgery, Ophthalmology, Orthopedics, Radiology, Urology, and others.

o Hospital-based practices – organized outpatient departments and emergency departments o Academic medical centers – departments and divisions of accredited medical schools

o Managed care plans – IHNs, IPAs, PHOs, MSOs, and HMOs

 Free-standing ambulatory care facilities o Urgent care centers

o Behavioral & Mental Health

o Ambulatory surgery centers (ASC)

o Medical imaging centers

o Community health centers (CHC)

o Rural health centers o Mental health centers

o Planned Parenthood Agencies

o Cancer/Hematology Centers

o Pain Management Centers

o Sports Medicine Clinics

o Heart Centers

o Etc.

Vendors that are specialist in successful implementations of solutions are targeting their customers as:  Small medical practices – solo through 10-physicians practices

 Medium-sized medical practices – 11 through 49-physicians practices  Large ambulatory care enterprises – 50 physicians and greater

These groups have definitive buying cycles and good governance with some kind of visible plan whether weak or strong. A multi-specialty practice’s buying behavior can be characterized. A single-specialty practice requires understanding of single-specialty practice workflows and content needs.

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Exhibit CA 1: Top twenty-five vendors’ market share by major segments -2010

Source: Jewson Enterprises POMIS Knowledge Base

POMIS Revenue Client-Server Revenue MBS Revenue Cloud-Based Revenue PMS Revenue MCIS Revenue EHR-EMR Revenue EHR-EMR & PMS $10,933.20 $6,822.20 $955.80 $3,155.20 $702.91 $1,008.45 $182.02 $9,039.82

McKesson Technology Solutions 8.5% 10.6% 10.8% 3.2% 0.0% 1.7% 0.0% 10.1% Publicly held Allscripts Healthcare Solutions, Inc. 6.2% 8.1% 0.0% 4.0% 0.0% 0.0% 0.0% 7.5% Publicly held EPIC SYSTEMS CORPORATION 5.7% 8.1% 0.0% 2.4% 0.0% 11.1% 0.0% 5.7% Privately held GE Healthcare Information Technology 5.3% 6.5% 0.0% 4.2% 0.0% 0.0% 0.0% 6.4% Publicly held TRIZETTO CORPORATION 4.9% 2.0% 0.0% 12.7% 0.0% 53.1% 0.0% 0.0% Privately held Vitera Healthcare Solutions 4.8% 6.5% 0.0% 2.5% 0.0% 0.0% 0.0% 5.8% Privately held NEXTGEN HEALTHCARE

INFORMATION SYSTEMS, INC. 4.0% 4.6% 5.5% 2.2% 0.0% 0.0% 0.0% 4.9% Publicly held athenahealth™, Inc. 3.9% 0.0% 15.5% 8.7% 0.0% 0.0% 0.0% 4.7% Publicly held CERNER CORPORATION 3.7% 4.0% 0.0% 4.1% 0.0% 0.0% 0.0% 4.5% Publicly held eClinicalWorks, LLC 2.6% 1.9% 0.0% 5.0% 0.0% 0.0% 0.0% 3.2% Privately held Merge Healthcare Incorporated 2.1% 2.9% 0.0% 1.1% 0.0% 0.0% 0.0% 2.6% Publicly held ZOTEC PARTNERS 2.1% 0.0% 23.5% 0.0% 32.0% 0.0% 0.0% 0.0% Privately held DST Health Solutions, Inc. 2.0% 2.7% 0.0% 0.9% 0.0% 14.9% 0.0% 0.7% Publicly held Varian Medical Systems, Inc. 1.8% 2.9% 0.0% 0.0% 0.0% 0.0% 0.0% 2.2% Publicly held ELEKTA/IMPAC Medical Systems, Inc. 1.5% 2.4% 0.0% 0.0% 0.0% 0.0% 0.0% 1.8% Publicly held MEDICAL INFORMATION

TECHNOLOGY, INC. (MEDITECH) 1.4% 1.4% 0.0% 1.8% 0.0% 0.0% 0.0% 1.7% Publicly held Siemens Medical Solutions USA, Inc 1.4% 2.2% 0.0% 0.0% 0.0% 0.0% 0.0% 1.7% Publicly held Healthcare Financial Services of

TeamHealth 1.0% 0.2% 8.7% 0.4% 0.0% 0.0% 0.0% 1.2% Privately held T-System, Inc. 1.0% 0.0% 0.0% 3.3% 0.0% 0.0% 0.0% 1.2% Privately held Medac, Inc. 0.8% 0.0% 9.4% 0.0% 0.0% 0.0% 0.0% 1.0% Privately held EPBS Intermedix 0.8% 0.0% 8.6% 0.0% 0.0% 0.0% 0.0% 0.9% Privately held Netsmart Technologies, Inc. 0.7% 0.0% 5.5% 0.9% 0.0% 0.0% 0.0% 0.9% Privately held Origin Healthcare Solutions, LLC 0.7% 0.2% 2.1% 1.4% 0.0% 0.0% 0.0% 0.9% Privately held Orion Healthcorp, Inc. 0.7% 0.0% 6.1% 0.7% 11.5% 0.0% 0.0% 0.0% Privately held Delta Health Technologies, LLC 0.6% 0.5% 1.6% 0.5% 0.0% 0.0% 0.0% 0.7% Privately held

Company Name

Ownership Top 25 Leaders Relative to Major Market Segments - Millions of Dollars & Percent

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Exhibit CA 2: Revenue Grouping of Vendors by Selected Segments – Millions of Dollars

Exhibit CA 3: Vendor Revenues Segmented by Groups – Millions of Dollars

Source: Jewson Enterprises POMIS Knowledge Base $5,426.20 $7,462.65 $8,607.20 $9,152.93 $9,476.12 $10,046.30 $10,933.12 Top 10 Vendors Top 25 Vendors Top 50 Vendors Top 75 Vendors Top 100 Vendors Top 200 Vendors All Vendors

Revenue Groupings of POMIS

Vendors, Millions of Dollars

$5,426.20, 50%

$2,036.45, 19% $2,013.47, 18%

$1,457.00, 13%

Revenue Grouping of Vendors by

Selected Segments, Millions of

Dollars

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Exhibit CA 4: POMIS Vendors Separated by the 80-20 Rule on Revenues

Exhibit CA 5: Distribution of POMIS Vendors Relative Customer Markets

0 100 200 300 400 500

6-physicians to 99-physicians group Solo to 5-physicians group Hospital-Based Practices Large Enterprises to IHNs Academic Medical Centers Managed Care Plans

Distribution of Vendors in Customer

Markets

57 Vendors With 80%, $8,763.10 Remaining 20%, $2,170.02

Depiction of 80-20 Rule Based on

Vendor Revenues Distribution

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GEOGRPHICAL DISTRIBUTION

There are 600 POMIS vendors, down from 707 vendors in 2008. Health reform and the stimulus money incentives are affecting growth.

 Consolidation and mergers have and will continue to occur for at least large acquisition-centric vendors and vendors in the $3 - $20 million category that want to compete.

 Several medical billing services vendors have dropped out of business because most are under-financed to deliver services based on the requirements from their customers. Several proponents in billing services have consolidated them into a services organization that hosts applications. Some enterprising business groups are beginning to consolidate billing services to get some market advantage.

The evolution of the health care industry is toward an ambulatory medicine focus that requires open, integrated information systems with new medical office functionalities and connectivity to enterprise-wide and community-enterprise-wide networks. Functionalities include applications in care coordination, managed care contract management, healthcare transaction processing exchange and editing, EDI services now and pending, human-engineered operating systems, remote computing (e.g., pen-based and/or wireless) for physician-patient interfaces to clinical records systems, office-based medical records systems using relational database management technologies, and computer-based patient record network systems. Most vendors are small entrepreneurs running billing services or independent dealerships. Hundreds of billing services have licensed practice management systems from medical software publishers or major systems vendors. Likewise, hundreds of dealers market practice management systems from software publishers that will be listed later. These small, independent groups of vendors have built regional/local presence along with consulting services, using direct and referral sales, and low cost support capability. The distribution channel for products and services is essential to reaching medical office practices. Systems vendors who demand control over their channel of distribution use direct sales, while software publishers use dealers, distributors, and resellers who license the software system for marketing. Medical billing services use direct sales; some billing services have formed a kind of franchise chain to reach medical offices in strategic local geographic areas.

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Exhibit CA 6: Distribution of Vendor Headquarters by State

Source Jewson Enterprises’ POMIS Knowledge Base

0 20 40 60 80 100 California New York Forida Texas New Jersey Georgia Michigan Pennsylvania North Carolina Illinois Massachusatts Missouri Arizona Indiana Virginia Ohio Tennessee Maryland Colorado Utah Washington Wisconsin Kansas Alabama Louisiana Minnesota Nebraska Connecticut Delaware Idaho Kentucky Nevada New Hamshire Oklahoma Rhode Island South Carolina Alaska Arkansas Hawaii Origon Maine Montana Iawa North Dakota New Mexico South Dadota Vermont

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Exhibit CA 7: Leading Revenue Leaders – Millions of Dollars

Exhibit CA 8: Vendor Revenues Segmented by Groups – Millions of Dollars

$927.0 $680.0 $625.0 $580.0 $535.5 $525.0 $440.4 $422.3 $406.0 $285.0

McKesson Technology Solutions Allscripts Healthcare Solutions, Inc. EPIC SYSTEMS CORPORATION GE Healthcare Information Technology TRIZETTO CORPORATION Vitera Healthcare Solutions NEXTGEN HEALTHCARE INFORMATION…

athenahealth™, Inc. CERNER CORPORATION eClinicalWorks, LLC

Leading Revenue Leaders, Millions of

Dollars

$0.00 $2,000.00 $4,000.00 $6,000.00 $8,000.00 $10,000.00 $12,000.00 Top 10 Vendors Top 25 Vendors Top 50 Vendors Top 75 Vendors Top 100 Vendors Top 200 Vendors All Vendors

Vendor Revenues Segmented by

Groups - Millions of Dollars

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Exhibit CA 9: Revenue Share of Privately Versus Publicly Held Vendors – Millions of Dollars

DELIVERY METHODS

POMIS is delivered under one or more of the following categories:  Client-Server Configuration.

 Medical Billing Services Provider.

 Cloud-Based Provider. Publicly Held Vendors, $5,490.25 Privately Held Vendors, $5,442.95

Revenue Share of Privately and

Publicly Held Vendors - Millions of

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Exhibit CA 10: Distribution of Delivery Methods

Exhibit CA 11: Pic Chart of Revenue Delivery Methods Market Share

0 50 100 150 200 250 300 350

Medical Billing Services (MBS) Client-Server (C/S) Cloud-Based (Cloud MBS Only C/S Only Cloud Only C/S+Cloud Only MBS+Cloud Only MBS+C/S Only MBS+C/S+Cloud

Distribution of Delivery Methods

Client-Server Segment, $6,822.20 Medical Billing Services Segment, $955.80 Cloud-Based Segment, $3,155.20

Market Segment of Delivery Methods

- Millions of Dollars

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Exhibit CA 12: Leading Client-Server Revenue Vendors – Millions of Dollars

Source: Jewson Enterprises’ Knowledge Base

$723.99 $553.52 $549.70 $446.60 $446.25 $317.09 $276.08 $199.75 $195.00 $186.19 $- $100.00 $200.00 $300.00 $400.00 $500.00 $600.00 $700.00 $800.00 McKesson Technology Solutions

Allscripts Healthcare Solutions, Inc. EPIC SYSTEMS CORPORATION GE Healthcare Information… Vitera Healthcare Solutions

NEXTGEN HEALTHCARE… CERNER CORPORATION Merge Healthcare Incorporated Varian Medical Systems, Inc. DST Health Solutions, Inc.

Leading Client-Server Vendors in

Revenues - Millions of Dollars

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MEDICAL BILLING SERVICES DELIVERY METHODF VENDORS’ ANALYSIS

Exhibit CA 13: Leading Medical Billing Services Vendor Revenues – Millions of Dollars

$225.00 $147.81 $102.90 $90.00 $83.46 $82.40 $64.10 $58.80 $57.96 $52.85 $0.00 $50.00 $100.00 $150.00 $200.00 $250.00 ZOTEC PARTNERS athenahealth™, Inc. McKesson Technology Solutions Medac, Inc. Healthcare Financial Services of…

EPBS Intermedix MedAmerica Billing Services, Inc. AdvantEdge Healthcare Solutions, Inc.

Orion Healthcorp, Inc. NEXTGEN HEALTHCARE…

Leading Medical Billing Services

Vendor Revenues - Millions of Dollars

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CLOUD-BASED DELIVERY METHOD ANALYSIS

Exhibit CA 14: Leading Cloud-Based Vendors – Millions of Dollars

MAJOR MARKET PRODUCT CATEGORIES

The major product market segments are:

 Practice Management Systems

 Management Care Information Systems

 EHR-EMR Solutions

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Exhibit CA 15: Pie Chart Distribution of Major Product Categories Revenues – Millions of Dollars

Exhibit CA 16: Distribution of Vendors by Major Product Categories

548 405 339 196 58 15 8 5 2 0 100 200 300 400 500 600

Practice Management Systems (PMS) EHR-EMR Solutions PMS+EHR-EMR Only PMS Only EHR-EMR Only Managed Care Information Systems…

PMS+EHR-EMR+MCIS PMS+MCIS Only MCIS Only

Distribution of Major Product

Categories Mix

$702.91 $1,008.45

$182.02 $9,039.82

Product Segmentation Revenue

Analysis - Millions of Dollars

Practice Management Solutions Managed Care Information Systems EHR-EMR Solutions Only EHR-EMR Solutions & PMS

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PRACTICE MANAGEMENT SOLUTIONS VENDOR ANALYSIS

Exhibit CA 17: Leading Practice Management Solutions ONLY Vendors – Millions of Dollars

MANAGED CARE INFORMATION SYSTEMS (MCIS) ANALYSIS

Exhibit CA 18: Leading Managed Care Information Systems Vendors – Millions of Dollars

$225.0 $80.5 $64.1 $58.8 $26.0 $18.3 $16.3 $16.2 $16.1 $15.0 $- $50.0 $100.0 $150.0 $200.0 $250.0 ZOTEC PARTNERS Orion Healthcorp, Inc. MedAmerica Billing Services, Inc. AdvantEdge Healthcare Solutions, Inc.

ACADIANA COMPUTER SYSTEMS, INC. Professional Management, Inc Medical Management Resources, Inc. MedPro Solutions, LLC HEALTH CARE SOFTWARE, INC. PRACTICE ALTERNATIVES, INC.

Leading PM Solutions ONLY Vendors

-Millions of Dollars

$535.5 $150.5 $112.2 $30.4 $28.8 $16.7 $- $100.0 $200.0 $300.0 $400.0 $500.0 $600.0 TRIZETTO CORPORATION DST Health Solutions, Inc. EPIC SYSTEMS CORPORATION Eldorado/MPHASIS Brightree, LLC McKesson Technology Solutions

Leading MCIS Vendors in POMIS

Database - Millions of Dollars

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EHR-EMR SOLUTIONS VENDORS ANALYSIS

EHR-EMR SOLUTIONS COMPETITORS

An -EHR-EMR system competitor offers a system either as a standalone EHR-EMR systems vendor, as a practice management systems vendor, or as a SaaS provider. The EHR-EMR systems vendor

specializes in clinical applications that are distributed directly to the medical practice or through an alliance with traditional practice management systems vendors that interface or integrate the -EHR-EMR with their practice management solution. Some POMIS vendors have developed their own -EHR-EMR and offer it directly to their customer base. The newer, emerging SaaS competitors use Internet

technology as the deployment model of practice applications.

It’s nationally clear that health information is vital. It’s vital to manage national health expenditures, to increase access to care, to maximize the quality of care, and to optimize patient outcomes. Citizens who seek care expect their caregivers to know allergies, chronic conditions, current medications, and other pertinent health care information to deliver effective treatment. Information technology will affect these mandates through efficiency improvements, which enables changes in health care workflow processes.

CHARACTERISTICS OF EHR-EMR SOLUTIONS VENDORS

In order for -EHR-EMR systems to meet needs in an ambulatory care setting for clinical, legal, and administrative requirements, its information infrastructure must support various component-ware functions: data capture, storage, processing, communication, security, and presentation. Since the marketplace varies from solo practitioners of several specialties to integrated health enterprises, there are three configurations:

 One for the solo and 2-physicians practice,

 One for medical group practices that may differ by number of remote locations, and

 IHNs that bring together physician’s offices and group practices as an enterprise of differing deliveries of care.

For example, a physician in a solo and 2-physicians practice is looking for a system to address managed care financial/administrative requirements and a patient/clinical-oriented system to rapidly document patient visits, reduce managed care paperwork, and automatically code member/population/patient episode of care. Larger groups, on the other hand, have more sophisticated needs of managed care contract management integrated with the concern for enterprise-wide EHR-EMR functionalities. The -EHR-EMR system license or user price varies for the first year of implementation by number of physicians/providers. In a SaaS model, the subscription price varies from $450 to $2,000 per physician per month after basic upfront costs. Most applications, although fulfilling our definition, are a mixture of database management functions and word processing program innovations. Others have adopted a chart dictation system, pen-based technology, wireless technology, or patient education strategy built around EHR-EMR system functionality.

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through marketing agreements with POMIS vendors. Lastly, POMIS vendors have developed their -EHR-EMR systems that are integrated into their traditional practice management system.

Exhibit CA 19: Revenue Leading Vendors offering EHR-EMR Solutions Only – Millions of Dollars

Exhibit CA 20: Revenue Leaders Offering Integrated EHR-EMR Solutions

$- $5.00 $10.00 $15.00 $20.00 $25.00 $30.00 $35.00 $40.00 $45.00 $50.00 iKnowMed CHARTCARE, INC. HealthMEDX, Inc. Forerun, Inc. CODONIX, INC. Novarad Corporation Health Communication Systems (HCS) Medflow, Inc.

Revenue Leading EHR-EMR Only

Vendors in Top 100 - Dollars in

Millions

$910.31 $680.00 $580.00 $525.00 $512.83 $440.00 $422.30 $406.00 $285.00 $235.00 $- $200.00 $400.00 $600.00 $800.00 $1,000.00 McKesson Technology Solutions

Allscripts Healthcare Solutions, Inc. GE Healthcare Information… Vitera Healthcare Solutions EPIC SYSTEMS CORPORATION NEXTGEN HEALTHCARE…

athenahealth™, Inc. CERNER CORPORATION eClinicalWorks, LLC Merge Healthcare Incorporated

Competitive Analysis Report

JEWSON ENTERPRISES

INTERNET-BASED POMIS REPORTS

Competitive Analysis Report

By Vinson J. Hudson

POMIS Analyst

COMPETITIVE ANALYSIS

Contents

COMPETITIVE ANALYSIS

INTRODUCTION

THE POMIS INDUSTRY

Revenue Groupings of POMIS

Vendors, Millions of Dollars

Revenue Grouping of Vendors by

Selected Segments, Millions of

Dollars

Distribution of Vendors in Customer

Markets

Depiction of 80-20 Rule Based on

Vendor Revenues Distribution

Leading Revenue Leaders, Millions of

Dollars

Vendor Revenues Segmented by

Groups - Millions of Dollars

DELIVERY METHODS

Revenue Share of Privately and

Publicly Held Vendors - Millions of

Distribution of Delivery Methods

Market Segment of Delivery Methods

- Millions of Dollars

Leading Client-Server Vendors in

Revenues - Millions of Dollars

Leading Medical Billing Services

Vendor Revenues - Millions of Dollars

MAJOR MARKET PRODUCT CATEGORIES

Distribution of Major Product

Categories Mix

Product Segmentation Revenue

Analysis - Millions of Dollars

PRACTICE MANAGEMENT SOLUTIONS VENDOR ANALYSIS

MANAGED CARE INFORMATION SYSTEMS (MCIS) ANALYSIS

Leading PM Solutions ONLY Vendors

-Millions of Dollars

Leading MCIS Vendors in POMIS

Database - Millions of Dollars

EHR-EMR SOLUTIONS VENDORS ANALYSIS

Revenue Leading EHR-EMR Only

Vendors in Top 100 - Dollars in

Millions

Revenue Leaders Offering Integrated

EHR-EMR Solutions