NextGen Healthcare President and CEO Rusty Frantz sounded off about hospital executives opposing proposed federal data-sharing rules while also sharing data with Silicon Valley tech giants.
During a Q&A with analysts on the company's third-quarter 2020 earnings call Wednesday, Frantz was asked for his take on the interoperability rule proposed by the Office of the National Coordinator for Health IT (ONC). The question came in light of Epic CEO Judy Faulkner sending an email to hospital customers urging them to speak out against the rule.
While he wouldn't comment on other vendor activities, Frantz said, "I struggled a little bit to understand why blocking that data exchange under the banner of patient privacy really makes sense, especially given how much patient identified data is already being shared by some health systems with other companies that aren't directly involved in the treatment of patients."
"It seems a little contradictory and emblematic of business and competition being put before care," Frantz said.
He appeared to be calling out health systems and hospitals partnering with tech giants like Google, Microsoft. and Amazon. Health system Ascension and Google are both facing significant blowback, including scrutiny from regulators and lawmakers, following news of their data deal.
"Wellness and lowering the cost of care is enabled by putting the patients' full medical record in front of physicians," he said. "We're bringing our clients into the world of interoperability and bringing them free of charge because we believe it's the right thing to do for both care and quality."
Many community physicians are challenged by the lack of data sharing across institutions which deprives them of critical information necessary for effective patient care, he said.
Frantz said he struggled to pull together his son's medical records across multiple hospitals and has resorted to faxing records and carrying a three-ring binder to ensure doctors had a complete view of his son's "complex health history."
"It's concerning to think that this patient identified data could potentially be shared with parties not involved in this care but not with the very doctors that are treating him," he said.
Q3 2020 financial results
NextGen Healthcare posted $4.4 million in profits in its third quarter of fiscal 2020, an 8.3% drop from earnings of $4.8 million in the same quarter last year, the EHR vendor reported.
The Irvine, California-based healthcare technology company also reported $137.7 million in revenue, up $6.9 million or 5% compared to the same quarter of 2019 and beating Wall Street forecasts.
The consensus revenue estimate was $135.4 million for the quarter.
Cash flow from operations was $23.6 million in the fiscal 2020 third quarter, up 28% compared to $18.4 million for the same period a year ago, NextGen Chief Financial Officer Jamie Arnold said during the earnings call. Free cash flow was $17 million, up 34% over $12.7 million in the same period a year ago, the company reported.
Bookings for the quarter came in at $30.6 million, down 7% compared to $32.8 million in the same quarter last year.
"Our third fiscal quarter of FY20 was another solid operating quarter which saw further enhancements in client satisfaction, two significant and successful client events, and three acquisitions which position us well to own the patient experience and drive growth in behavioral health,” Frantz said.
The company narrowed its outlook for fiscal 2020 and is projecting revenues between $541 million and $547 million versus the previous range of $540 million to $550 million.
In November, NextGen announced it was acquiring patient experience platform Medfusion for $43 million to give its clients a better patient engagement platform. It completed the deal in December.
Medfusion's solutions include a patient self-scheduling solution, an industry-leading EMR-agnostic portal that drives patient engagement and a robust portfolio of healthcare application programming interfaces.
The company also acquired telehealth company Otto Health in December, and those two deals follow NextGen's acquisition of Topaz Information Solutions, a behavioral health solutions provider, in October.
Frantz said during the call that these acquisitions give NextGen Healthcare the capability to "truly own the end-to-end patient experience."
"Medfusion and Otto Health unlock our ability to offer a solution that is fully integrated into our broader platform to address the key dynamic in healthcare, the rising consumerism. These are acquisitions with strong capabilities in patient intake and patient pay as well as patient self scheduling position us well to meet this important and growing need in a truly integrated way," he said.
Ambulatory proviers today are using a complex multi-vendor approach to meet these needs. "We believe that an integrated approach will reduce risk and complexity, leading to a better solution with a lower total cost of ownership," Frantz said.
NextGen also announced it was spinning out Medfusion's data services business to form Greenlight Health to meet the growing need for patient-initiated health data retrieval.