Interview With Stephen Pacicco Executive Vice President
and Frank DiGiambattista VP of Product Development

How did the vision for Amicore first develop?

For 12 years, I worked in a strategic planning group at Pfizer; the idea for Amicore developed out of work I did with that group. We saw, back in 1994 or 1995, the opportunities that technology could have to affect the health care system, that it could greatly reduce the inefficiencies in health care, advance patient care, enhance the interaction between a patient and a physician, and so on. We tracked this for the next six or seven years, and did a lot of market research on the needs of physicians. We started to realize that for physicians, it wasn’t just about the product, it was about the company as well. There have been a lot of problems in the last 20 years with health care technology companies going out of business. If doctors are going to make the major investment involved in automating their practices, they want to know that the company with which they’re working is going to exist tomorrow and the next day. So we went out to find what we thought were the best partners we could, and that’s how Pfizer ended up with IBM and Microsoft. It was not just about the product, it was about the companies.

What need did Pfizer identify that led to the development of Amicore?

Pfizer has sales representatives who talk to doctors every day, and they hear it loud and clear: doctors are frustrated practicing medicine nowadays. They’re under immense pressure, and dealing with a huge administrative burden, and Pfizer was hearing about it every day. Pfizer, Microsoft, and IBM came together conceptually in March of 2001, and then Amicore was formally launched in September 2001.

What type of practice is Amicore best suited to serve?

Our focus has been on independent physician practices, rather than hospitals and larger academic medical centers. We tend to serve practices ranging in size from solo practitioners to around 15 physicians per practice, although we do have some larger clients. There are currently about 1,000 contracted physicians; nearly 75% of those are actually live and using the product. Just about every physician practice we visit—95% or more—has an electronic billing or scheduling system in place. Our focus has been on clinical systems and electronic medical records, and adoption of those types of applications is much less common.

Do you expect technology like this to become more in the mainstream in the near future?

Yes, we do. We’re pretty bullish on adoption of these products. We’ve seen a lot of activity, particularly in the second half of 2002. December was one of our best sales months ever, and the first quarter of 2003 is looking to be our best quarter ever. We believe that during the next year, we’re going to see real acceleration in this market. Over the next four years or so, we expect significant adoption well into the mainstream. I think this is partly the inevitable march of technology. These systems started in earnest about eight years ago, and you saw a lot of visionary practices adopting them at that time. Over time, the technology has gotten better and the prices have come down, so adoption is less of a risk for physicians. At the same time, the problems that the physicians face—the inefficiencies, the administrative burdens, etc—have not gone away. Over the last 10 years, physicians have tried selling their practices to managed care plans or hospitals. There was the physician practice management wave back in the mid 90’s that came and went, doctors have tried sophisticated post-it systems in their practices, and the problems simply haven’t gone away. HIPAA, I think, is beginning to accelerate adoption as well. So I think there’s a confluence of factors that have led to this point, where we’re beginning to reach the early mainstream phase of market adoption. Market adoption has been the biggest challenge. I can’t figure out why anybody wouldn’t want to do this, but it’s classic technology adoption. Some people want the whole system fully baked before they’ll go for it. My brother, who is a doctor, asks, “Do you have all the connections to the payers and the labs and the pharmacies?” And I say, “Well, not all that connectivity exists yet, but we’re working on it.” And he says, “Maybe when that’s all there.” I think that’s just a classic mainstream adopter attitude, and it slows things down a little.

What feedback have you received so far from physicians?

It’s been great! What happens is, physicians really sell to other physicians. One of the barriers had always been that physicians perceived automating their clinical practice to be something of a risk. When one physician takes the risk, and has success, that perpetuates more sales. Doctors talk to other doctors and say, “You know, I adopted Amicore Clinical Management, and I got a payback in under nine months, the chaos in my practice has gone away, my professional satisfaction goes up; you have to try this.” Lately we’ve been getting calls from physicians wanting to see a demo; we’ve also had very short sales cycles, in some cases under a month (when I started this, the typical sales cycle could last years).

What specific elements of Amicore’s products distinguish the company from its competitors?

We like to think of ourselves as a practice improvement company; our mission is to improve the operational and financial health of physician practices. As we mentioned, there are already a lot of companies that manage billing and scheduling. However, doctors have traditionally been Interview concerned about using technology in the exam room, with a patient; a lot of companies were put off by that fear, so they would automate around the doctor, they would automate billing, scheduling, and some of the managed care transactions, but they would stay out of the exam room. We decided to take on the exam room, and to automate the actual encounter between the physician and patient. It’s the physician’s direct contact with the patient that drives 80% or more of the activity in health care in the United States. So if you can make that process better, if you can bring information to the doctor at the point of care, and then take information from the point of care and send it to a lab, pharmacy, or payer, then you’ve really made a difference. I think that’s what has the physicians most excited. They go into the exam room with mobile technology, or a Tablet PC, and they go through history of present illness or social history, and then the actual encounter, and they can document it all electronically. There are companies out there that have been around for a long time, and are established in the industry, but they’ve primarily been on the billing and scheduling side, so I think we do compete well against them.

Have you made any changes based on user feedback?

The first thing that Amicore did when it incorporated was make an acquisition, acquiring a company called the PenChart Corporation. That product is about five years old, and has been in productive use for most of that time. We looked at more than 100 companies, and there was a little secret sauce in the PenChart product that got physicians to use the technology. There was an intensity of use that we saw with PenChart that we didn’t see with any other product. The product’s been around five years; the things we’ve added to it come from user feedback. One specific thing is the ability to create reports from the information that’s collected.

Physicians purchase the product initially because they want to reduce costs and improve efficiency in their practice. A year or two into it, they’ve been able to get rid of the inefficiencies in the practice, and doctors start asking what can be done to improve patient care. In this case, the answer was: physicians wanted to be able to report on the information they collect in the exam room. That’s one feature we’ve added; we’re calling it ad hoc reporting, and it should be out in February. Another area in which we’ve evolved is the development health maintenance reminders, which we feel adds some intelligence to the system. For example, if a patient is diabetic, and hasn’t had an eye exam in over a year, the system will be able to prompt the doctor to schedule such an exam. So the next big step in our evolution is to move beyond process improvements to improvements in the overall quality of care, which is what physicians are requesting.

How complicated is it to integrate existing patients into the Amicore system?

It’s really not. It’s a very intuitive user interface; we provide training, for physicians and for the office staff. Complete training for a typical group is less than one week. We offer constant support; it’s not 24-7, because practices aren’t 24-7. We mirror the operating hours of the practices we serve.

What sort of hardware costs can a physician expect when installing Amicore’s system?

We try and leverage any investment that clients have already made in technology, such as hardware, or a network. It’s therefore difficult to give an exact cost, because it varies rather widely depending on the size of the group and the amount of equipment they already have. Prior to the release of Microsoft’s Tablet PC we used other equipment, but essentially we’re talking about a wireless computing device that the physician takes into the exam room or anywhere in the office.

What kind of security assurances do you offer to doctors?

We need to be compliant with all HIPAA regulations, of course, and constantly progress with that. We take security very seriously, especially with patient information. We use high level bit encryption at the wireless level, and also employ encrypted passwords and encrypted physical access on the local server. We try to make sure that there are multiple layers of security. Even if HIPAA didn’t exist, we’d have to take these things seriously; as it is, we’re well-positioned to comply with anything HIPAA requires.

Do you customize your services for individual physician specialties?

Yes. You really have to specialize in order to get adoption. We focus on primary care physicians, family medicine practitioners, and OB/GYNs, but we also serve a number of specialties, particularly cardiologists and orthopedists. In order to get those doctors to adopt the product, the clinical content that they use to document each encounter in the exam room has to be specific to their specialty, so we customize it.

Do you have any interesting future plans at Amicore?

As I mentioned, we are adopting the Tablet PC as hardware for the system, and we’re pretty excited about that. We have a release coming out this year that’s going to have the ad hoc reporting option we discussed. In the longer term—and I do mean the longer term— I think there’s an opportunity to do something with clinical trials. At the end of the day, Amicore’s job is to automate the workflow in these physician practices, and that really lays the groundwork to enhance the clinical trial process. We could, for example, automatically identify patients who are potential candidates for clinical trials, help physicians become clinical investigators, and so on.