The market for electronic medical records systems heats up.
Hoping to get a jump on the fast-growing market for electronic medical records, a unit of UnitedHealth Group is offering interest-free loans to doctors' practices that choose its CareTracker product.
Ingenix Inc., the data and technology arm of Minnetonka-based UnitedHealth, is targeting smaller doctors' offices, which often can't afford to invest millions in an electronic records system.
The loans will be offered through another UnitedHealth subsidiary, OptumHealth Bank.
"This solves the problem for them of not only how to get the technology but how to pay for it," said Kim LaFontana, vice president of strategic initiatives at Ingenix.
Ingenix plans to announce the loan program next Wednesday. In a sign of how hot the market is, one of the biggest players in the field -- Allscripts-Misys Healthcare Solutions of Chicago -- plans to unveil Monday its own loan offer for a similar product aimed at small doctors' practices.
Bigger hospital and clinic groups, including many in Minnesota, have begun installing electronic records systems to try to raise efficiency, cut medical errors and better track care and cost.
That makes the lower end of the market "the biggest battleground" now, said Todd Stein, a spokesman for Allscripts. "The one-to-10 physician group size make up half of all physicians in the U.S. It's a huge market we're all eager to take advantage of."
It's also a market that's attracted even unlikely players such as Sam's Club, a division of Wal-Mart Stores Inc., which last year began selling its version of electronic medical records in some markets.
A major push by state and federal governments has raised the urgency for physician practices to get on board the electronic train. In Minnesota, all health care providers and hospitals must have such systems by 2015 and the state has made available money for loans.
The federal government is also pushing for the adoption of electronic records through the 2009 American Recovery and Reinvestment Act, with payments that start in 2011.
Compared to Allscripts, which has signed up 60,000 physicians, Ingenix is a relatively small player with 5,000 physicians so far, mostly in the northeast.
Ingenix's CareTracker is housed in the new Physician Solutions division, which now contributes a "very small percentage" of revenue for Ingenix, said CEO Andy Slavitt. Ingenix had revenue of $1.5 billion in 2008 and is one of the smallest but fastest-growing and most profitable divisions within UnitedHealth.
Ingenix is promoting its no-interest financing as a bridge loan until the federal Medicare payments arrive.
"It's easier to install and delivered through a subscription service over the Web, like online banking," said LaFontana. "What that lets us do is make it available to physicians in smaller practices that don't have tons of capital."
CareTracker has an upfront installation cost of $5,000 and then charges $7,000 per physician per year. The interest-free loan will cover that cost until the system is running and Medicare payments kick in, allowing doctors to repay the loan.
Chen May Yee 612-673-7434