ProxyMed & Medscape Select Atlas LabWorks™

Collaborations with Atlas Development Corp. involve electronic lab test ordering capabilities

CEO SUMMARY: ProxyMed and MedScape just announced contracts with Atlas Development Corporation. Both companies will integrate Atlas LabWorks™ for electronic test ordering and results reporting into software products they sell to labs and physicians’ offices. Such collaborations again illustrate the importance of a competitive solution for electronic lab test ordering and reporting.

THERE’S A NEW VENDOR RAISING its profile in the competitive marketplace for browser-based lab test ordering and results reporting systems.

It was announced on November 16 that ProxyMed, Inc. and Atlas Development Corporation had signed an agreement to collaborate. ProxyMed will incorporate the “Atlas LabWorks™ ” software for electronic lab test ordering and results reporting into its “ProxyLab” system. Additional features, including patient test results notification capability, will also be part of ProxyLab’s functionality.

Business Collaboration

Just ten days later, on November 26, Medscape, Inc. of Hillsboro, Oregon made public its own business collaboration with Atlas. Under terms of the agreement, Atlas will provide Med- scape with an electronic lab test ordering solution for its suite of clinical software products.

Medscape provides clinical decision support and other information services to healthcare providers, particularly office-based physicians. Its Logician® EMR (electronic medical record) and its upcoming Web-based chart room and messaging applications already support lab test results reporting.

Used At 500 Sites Nationally

Atlas Development Corporation, based in Woodland Hills, California, is a software development firm with established credentials. Its LabWorks software product is used for electronic test ordering and results reporting by Dynacare, Inc. and Spectra Renal Management, Inc. (which uses LabWorks in more than 500 dialysis clinics throughout the United States).

THE DARK REPORT believes each of these collaborations are noteworthy. They provide evidence of ongoing changes in how physicians’ offices communicate with laboratory providers. A closer look at ProxyMed and Medscape will illustrate why this is true.

ProxyMed, with headquarters in Fort Lauderdale, Florida, describes itself as an “electronic healthcare transaction processing services company.” It operates “ProxyNet,” designed to connect physicians and other care providers to payers, pharmacies, and clinical laboratories for financial and clinical uses.

ProxyMed’s presence in the lab industry is extensive. In 1998, it acquired Key Communications Service, Inc., itself founded in 1976 and widely-recognized in the lab industry as a major provider of connectivity solutions between labs and their physician office clients. Primarily this involves maintaining teleprinters and PCs in physicians’ offices on behalf of its laboratory customers.

“Talks between our two companies actually started at the Executive War College last May,” stated Nancy Ham, President and COO of ProxyMed. “Having heard each other’s presentations, we both recognized that our strengths were complementary.

“ProxyMed and Key Communications Services have long-term experience in DOS-based thick client products such as KLM and ClinScan,” she noted. “We were looking to offer our clients an upgrade path. We needed a solution that was stable, proven, and highly configurable to the needs of individual customers.

Flexible Design

“We find LabWorks to be relevant for us because of its flexible design,” noted Ham. “It can run as either thick client or thin client. It can be run on the Web and Windows platforms. It can run on a hospital’s intranet as well as the Internet. Since we serve more than 550 laboratories in the United States, we need a platform software product that can serve this variety of environments without significant modification.”

The ability of LabWorks to be easily configured in a number of ways was equally attractive to Medscape. “We will begin aggressively promoting its lab test ordering solution to our clients,” stated Pat Wolfram, Vice President, Product Integration at Medscape. “It’s our tool of choice.

“Our electronic medical record (EMR) system, Logician, is already used at more than 600 clients,” he added. “These range from integrated delivery networks—many with their own physicians’ office laboratories-to small group practices. Some clients chose the client server-based Logician in order to own and manage their own data. Others want an ASP [application service provider–thin client solution]. They are opting for the Web-based chart room and messaging services. We chose Labworks because it can serve both environments.

“Our systems are designed to be used by physicians and other care providers in their daily work,” Wolfram explained. “What we’ve learned about EMR and lab test ordering is that it absolutely must align with a physician’s way of doing business, otherwise it won’t be used.

“Since most physicians are at different points in their acceptance of digital data, we’ve had to learn how to match our clinical support services with the individual physician’s way of conducting business,” he said. “As they realize our solution is just as easy as their paper-based method, they comfortably switch to the digital method.

Connecting the Dots: Who Are the Players?

TO BETTER UNDERSTAND THE FORCES causing shifts in the competitive lab marketplace, it helps to know the backgrounds of the people actively introducing new products and services.

Within ProxyMed, two individuals have deep roots in the lab industry. Michael K. Hoover, Chairman and CEO, and Nancy J. Ham, President and COO, were principals in ActaMed, the company which owned and managed the communications infrastructure of SmithKline Beecham Clinical Labs’ teleprinter and SCAN PC services serving its physicians’ office clients. When Healtheon (later to become WebMD) acquired ActaMed, it helped develop its Dx product for browser-based lab test ordering before eventually joining ProxyMed.

At Atlas Development, President Rob Atlas has significant experience at moving lab services onto an Internet-based platform. His firm did extensive development work for the precursor system to Specialty Laboratories’ DataPassportMD product before Specialty took the project totally in-house.

Patient-Specific Data

“With the help of Atlas, we are configuring our electronic lab test ordering function to work exactly the same way the physician works,” noted Wolfram. “One way our Logician system adds value is the way it provides patient-specific clinical data to the physician as he orders the test. This enables the physician to order tests faster, more accurately, and to provide the correct information needed for the lab to process the test and get paid.”

“What we’ve learned about lab test ordering is that it
absolutely must align with a physician’s way of doing business, otherwise it
won’t be used.” Pat Wolfram–Medscape

As the comments from executives of ProxyMed and Medscape demonstrate, physicians demand sophistication in the design and operation of an electronic test ordering system. Their parent organizations require different types of thin client and thick client solutions, sometimes both within the same healthcare system.

ProxyMed and Medscape have a different relationship with the physicians’ office market than clinical laboratories. Based on this experience, they want to develop a more sophisticated capability for electronic lab test ordering.

For that reason, laboratory administrators and pathologists should track how well ProxyMed and Medscape do in their efforts to convert physicians from paper test requisitions to electronic test ordering. Rapid physician acceptance would be a market sign that both companies successfully “cracked the code.”

From the other side of the table, these two collaborations position Atlas Development to get its systems into a lot of physicians’ offices. In doing business with 550 laboratories, ProxyMed already provides lab support services to thousands of physicians’ offices. The opportunity is similar at Medscape, which currently has 600 client sites and is growing steadily.

Bring Value To Doctors

THE DARK REPORT notes that both ProxyMed and Medscape are companies built around the concepts of heatlhcare e-commerce. They want to bring value to the physician’s office by introducing new tools and work processes that support the physician’s clinical activities and eliminate paper and unnecessary or wasteful work procedures.

To accomplish this, each company has recognized that it must play a role in moving, storing, and analyzing laboratory test information if they are to be successful. After all, lab data is the majority of the permanent patient medical record.

That’s why ProxyMed and Medscape aptly illustrate how such companies are working to capture functions traditionally provided to physicians’ offices by clinical laboratories.

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