Allscripts Wins a Client

Zacks

Allscripts Healthcare Solutions (MDRX), a leading player in the health care information technology (:HCIT) market, recently reported that Coordinated Health, an integrated health delivery chain operating in New Jersey and Pennsylvania, has selected Allscripts Sunrise Clinical Manager as the Electronic Health Record (:EHR) of choice.

This EHR will facilitate joint care efforts across Coordinated Health’s multiple locations. Furthermore, it will provide medical practitioners timely access to patient-related data.

Coordinated Health utilizes Allscripts Enterprise offerings for its outpatient EHR requirements. It will now use the Allscripts Sunrise Clinical Manager to convert inpatient records into an electronic mode. Allscripts will ensure a composite and unified electronic data solution across their medical practice.     

Coordinated Health has multiple locations in the eastern part of Pennsylvania. It has specialists in different practices, such as cardiology and orthopedics.

The health care information technology market is competitive and price sensitive. Among others, Allscripts faces strong competition from Cerner Corp. (CERN), Quality Systems (QSII) and Athenahealth (ATHN).

However, optimism about the growth prospects of select HCIT service providers remains high under the Obama administration, which passed a Stimulus package in 2009. Part of the Stimulus package is aimed at increasing the use of EHR systems by medical practitioners. While greenfield opportunities are currently shrinking, the replacement market is growing.

The company has widened its user base after its mergers with Misys and Eclipsys and increased cross-selling opportunities. We believe that Allscripts is well positioned in the fast growing business of selling EHR to physician practices as well as inpatient settings.

We are of the opinion that acute and ambulatory care will continue to converge in future. Also, that Allscripts is positioned to provide integrated clinical applications for health care providers to satisfy HITECH Act requirements and eventually comply with an outcomes-based reimbursement system.

We have a long-term Neutral recommendation on Allscripts. The stock currently retains a Zacks #2 Rank, which translates into a short-term Buy rating.

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