US Acute Care EHR Market Share in 2024 - Cover

US Acute Care EHR Market Share in 2024

From January 2023 to December 2023, acute care EHR purchasing continued to be high, and it shows no signs of stopping. Although purchase energy in 2022 was mostly driven by small organizations, this was not the case in 2023, when the majority of go-forward decisions came from large health systems. In our recently published US Acute Care Market Share 2024 report, we look at this update and many others taking place in the EHR market.

Two Noteworthy Purchasing Trends

As we mentioned above, small organizations made fewer purchases in 2023 compared to 2022, mainly due to financial constraints. These organizations instead focused on consolidating healthcare IT systems and having broader data-exchange capabilities. The sudden decline in decisions surprised us, since purchasing among these organizations was strong during the pandemic and for some years after. Because small organizations made fewer purchase decisions, market share was impacted for all the big players (i.e., Epic, MEDITECH, Oracle Health).

Another trend to note is specialty-hospital wins increased for Epic and Oracle Health in 2023. This market has become more competitive for vendors because specialty hospitals want capabilities that other hospitals have, like broad integration and analytics functionality. Interestingly, competition among vendors has shifted as they have focused on different sizing breakouts in the market—for a while, vendors were hoping to win large organization contracts before shifting their focus to small organizations. Now, some vendors—particularly Oracle Health—are shifting focus to specialty organizations.

Updates on the Big Players

a map of the US shows Epic market share vs. all other vendors

Epic continues to dominate market share; they now cover over half of all acute care multispecialty beds in the US. Epic’s wins mostly come from organizations wanting to achieve better integration, consolidate systems, and benefit from the strong customer experience offered by the vendor. Community Connect also gained some traction among small standalone hospitals and specialty hospitals.

Oracle Health saw their largest net hospital loss on record due to multiple large multispecialty organizations choosing to leave. Additionally, the general lack of decisions by small organizations greatly impacted Oracle Health, whose primary source of market share wins since 2016 has been small standalone hospitals. The vendor also saw customers leave the Millennium platform because of declining performance and ongoing revenue cycle issues. In contrast, Oracle Health has seen a lot of specialty hospital wins—organizations that contracted in 2023 anticipate that the technology and integration will contribute to their success.

MEDITECH’s legacy customer retention rate in 2023 was the lowest on record, despite their 2022 retention rate being an all-time high (one large health system migrated from MAGIC to Expanse). Current customers want MEDITECH to provide more guidance and focus more on developing additional or enhanced functionality—particularly for interoperability, patient engagement, and analytics. Adoption of MEDITECH’s interoperability and patient engagement functionalities is low, contributing to the customer belief that the vendor lacks these functionalities. Still, MEDITECH saw several new sales, which were split between health systems and standalone hospitals.

What Could Happen in Coming Years?

Although 2023 was a down year for small organization decisions, it wouldn’t be surprising if wins in that market rebounded in 2024 or 2025. Although small organizations will still be dealing with a lot of financial uncertainty, many will be looking to make a change, as they are using a legacy solution or are dissatisfied with their current vendor. Many large organizations chose to go with Epic in 2023, and in order to exchange data, some small organizations are starting to feel that they must go with Epic Community Connect in order to exchange data effectively.

As the only vendor to have increased market share in 2023, Epic is gaining momentum, but the industry is ripe for disruption. Another vendor could come in and turn everything on its head. Competition—whether from an existing player or a new entrant—is appealing to a lot of people because they want to choose from multiple options. Even those who choose Epic want to have more competitive options to choose from. Only time will tell what will happen next.

The Importance of Tracking EHR Market Share

As we publish this market share report year after year, we consistently uncover interesting developments in the data. This report is a reality check—what’s really happening in this behemoth of a market? The EHR is as important to hospitals as smartphones are to everyday people. We all want to know what’s happening with Apple, Samsung, and Google and how our phones will be affected; likewise, hospitals need transparency into who is gaining market share in the EHR industry and how well they perform.

Thus, we at KLAS are going to continue gathering as many details as possible each year to provide necessary transparency. We don’t predict the future, but we do strive to clearly show past and current trends so that readers can make more educated plans for their next steps.

For all the 2023 updates, be sure to check out the report.

 




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