A Frost and Sullivan report, U.S. Hospital EHR Market, 2009–2016: Charting the Course for Dramatic Change, published earlier last month, reveals that the electronic health records (EHR) market is on path to grow more than six times its 2009 revenues of under a billion dollars to $6.5 billion in 2012, a clear indication that the implementation of the HITECH Act resulted in increased spending by health care providers on IT infrastructure. The researcher believes that significant change has happened since 2009, when approximately 12% of hospitals were using basic or advanced EHR, and only 2% of those were using EHRs in a way that would qualify for meaningful use. HITECH Act laid out several parameters to identify providers using their inter-operable EHR system for meaningful use of delivery of healthcare services, and offered incentives to these providers with additional payments received through Medicare and Medicaid. To help healthcare providers to benefit from these financial incentives, EHR providers are expanding their offerings.
Athenahealth’s (NASDAQ:ATHN) Q3 revenues grew 33% over the year to $83.7 million, ahead of the market’s estimate of $83.1 million. EPS of $0.24 was better than the market’s projected earnings of $0.22.
During the quarter, the company reported $1.9 billion in collections posted to client accounts compared to $1.5 billion a year ago. Active medical providers using athenaCollector increased to 31,675 compared with 26,317 providers a year ago. The number of active medical providers using athenaClinicals also grew from 2,818 a year ago to 5,849 and the number of those using athenaCommunicator grew from less than 1,000 a year ago to 4,117 at present.
For the current year, Athenahealth projected revenues of $315 million-$325 million with EPS of $0.70-$0.83. Analysts were expecting revenues of $321.4 million with EPS of $0.85 for the year.
Athenahealth’s Expanding Services
Athenahealth continued to expand their offerings and recently launched an online dashboard that informs viewers about the performance of doctors on its network against the 20 meaningful use parameters. The dashboard gives information on measures presenting the greatest challenges to providers and their practices as they work toward successfully completing the attestation process to be able to collect their incentive payments available to them as part of the HITECH act.
They also launched athenaCoordinator which is another cloud-based service with the help of their earlier acquisition of Proxysys. Coordinator helps to deliver Athena’s existing product line, including integrated revenue cycle management and HER services as well as patient communication services through a workflow process between physicians, their hospitals, and other patient care centers. The coordinator performs processes such as transmitting orders to hospitals and surgical and imaging centers by enabling hassle-free order entry for doctors for pre-certification and pre-registration. Athenahealth plans to extend this service to other healthcare bodies such as pharmacies and labs.
Athena’s stock is currently trading at $52.89 with a market capitalization of $1.87 billion. Earlier this quarter, it touched a new 52-week high of $72.70.