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MDRX Expands at Liberty Hospital

Zacks Equity Research

Allscripts Healthcare Solutions, Inc. (MDRX), a leading player in the health care information technology (:HCIT) market, recently announced that Liberty Hospital, a prominent public hospital on the I-35 highway between Liberty, Mo. and the Iowan border, has inked a deal with Allscripts to handle its IT requirements. 

As per the hospital, the expanded scope of the agreement will permit it to focus on delivery of health care. Allscripts will focus on its core competence of managing IT systems at Liberty Hospital. The agreement prepares Liberty Hospital to deal with the evolving nature of health care delivery.

Liberty Hospital has at present 30 personnel managing its IT systems. Following the agreement, these employees will join Allscripts. 

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

As a potential takeover target, Allscripts presents a lucrative opportunity for firms seeking entry into the HCIT industry. It has a wide user base and enjoys many opportunities vis-à-vis its peers. Its mergers with Misys and Eclipsys have expanded opportunities and reach in practice management (PM) and Electronic Health Record (:EHR) markets substantially 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.

The HCIT market is competitive and price sensitive. Among others, Allscripts faces strong competition from Cerner Corporation (CERN), Quality Systems Inc. (QSII) and Athenahealth, Inc. (ATHN). Allscripts carries a Zacks Rank #3 (Hold).

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