PropaqLT

At the Cerner shareholder's meeting this week, Neal Patterson described 4 new "fundimental directions" for growing the company.

Building on 2005 revenue of $1.2 billion and earnings of $86 million, Patterson said the health care information technology leader will focus on moving: [...] Further into medical devices, using Cerner software to integrate everything from hospital beds to drug-dispensing cabinets with electronic medical records.

This position reinforces a press release from this past February.

For more than a quarter century, Cerner has been driving the automation of healthcare through its industry-leading information technology solutions,” said Neal Patterson, Cerner chairman and chief executive officer. “Today, Cerner is taking the next step to providing our clients with end-to-end solutions that deliver a greater level of patient safety and increase organizational efficiency.”

Although most of the steps described in the press release depict the benefits of more extensive systems integration between information systems capabilities rather than medical devices, there is this:

In addition, Cerner is working together with several device manufacturers to develop integrated clinical data delivery mechanisms, allowing interoperability between Cerner Millennium technology and healthcare providers’ hardware. For example, Welch Allyn, a leading manufacturer of frontline medical devices and solutions, and Cerner intend to work with select client sites to study workflow efficiencies and innovative methods for turning patient data into actionable healthcare information.

The benefits that could be gained through interoperability between medical devices and information systems are considerable. Cerner already has connectivity with most of the "smart" pumps. However there are numerous barriers to realizing interoperability, least of all medical device vendor's preference for proprietary technology and business strategies.

The barriers I'm talking about include regulatory, systems integration, and business model. Someone is going to break through these barriers (there are a number of vendors working on this). In a world where hospitals frequently prefer single vendor solutions, and many vendors are more interested in protecting their installed base than launching ground breaking new products, I don't see interoperable solutions impacting the market for some time.