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Why VCs Don’t Invest in Healthcare IT

Posted on May 15, 2013 I Written By

John Lynn is the Founder of the blog network which currently consists of 10 blogs containing over 8000 articles with John having written over 4000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 16 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of and John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit and LinkedIn.

The always vocal Jonathan Bush has a great article in Techonomy that talks about why many venture capitalists (VCs) have stayed away from healthcare IT investments. He provides a lot of food for thought for entrepreneurs looking at health IT.

Here’s the 3 reasons he gives for investor insecurity with healthcare IT investments:
1. Healthcare consumers don’t shop
2. The biggest buyer stifles innovations
3. Service, quality and competitive pricing aren’t rewarded.

Here are his 3 solutions:
1. Do good and do well
2. Get noticed
3. Serve the market that has a lot of buyers!

I really like his 3 challenges. I’m not sure his solutions are enough, but I’m glad he’s really cranking up the conversation on what it takes to be an entrepreneur in healthcare IT.

Silicon Valley Hype Machine Revs Up Again

Posted on August 18, 2011 I Written By

I hate to keep bashing Silicon Valley, since I’ve come to think that it’s venture capitalists, not tied to one particular region, who are the ones not “getting” healthcare. That said, we got a bit more overblown hyperbole coming out of Northern California this morning from drchrono.

The Mountain View, Calif.-based company, which likely is correct when it says it created the first EHR that it native to the iPad—and a free one at that—announced today that it has received an new round of $650,000 in seed funding  from the VC community. (Congratulations on that.) Drchrono today also introduced OnPatient, an iPad app that replaces the hated clipboard and paper form for taking patient history at the doctor’s office. Here are the details, from the drchrono press release:

drchrono Launches iPad App to Replace Paper-Based Check-In at Doctor’s Office; Closes Additional $650,000 in Seed Funding

Free OnPatient App Digitizes Patient Waiting Room and Integrates Seamlessly with Electronic Medical Records

Mountain View, CA – August 18, 2011 – drchrono, the company modernizing healthcare through a free Electronic Health Record (EHR) platform on the iPad, today announced a new patient check-in app which replaces the traditional paper check-in process in the physician waiting room. OnPatient is an app that can be downloaded to the iPad for free and integrated into a medical practice as a stand alone onboard app. The patient check-in app also seamlessly integrates with drchrono’s Meaningful Use-certified iPad EHR.

On the heels of the OnPatient product launch, drchrono recently closed an additional $650,000 in seed funding from prominent start-up investor Yuri Milner, founder of DST Global, and venture capital firm General Catalyst. This follows $675,000 in seed funding from General Catalyst, Charles River Ventures, 500 Startups and angel investors, previously announced in July.

“The OnPatient check-in app digitizes the waiting room and eliminates significant barriers to mass adoption of patient check-in technology by leveraging sophisticated iPad technology. Proprietary check-in hardware is prohibitively expensive and integration with existing EHR systems is too complex,” said Michael Nusimow, co-founder and CEO of drchrono. “We designed the OnPatient app to be intuitive for both physicians and patient users to create a better patient check-in experience.”

OnPatient is a full-featured app with customizable templates that enable physicians to eliminate paper forms and clipboards in the waiting room. There are no contracts or monthly fees; the only hardware investment is the iPad itself. Upon download, the OnPatient app allows patients to:

  • Complete family medical history and demographic information
  • Complete insurance information
  • Snap a profile photo
  • Sign the HIPAA consent form with a digital signature

The touch screen interface is user-friendly and the information auto-populates directly into the drchrono EHR platform. On subsequent visits, patients do not have to complete duplicate forms—they need only review their information and make any necessary changes on the iPad. OnPatient meets all industry security standards, ensuring the privacy and safety of patient data.

For more information on drchrono and the OnPatient app, please visit

About drchrono: 

drchrono focuses on Apple’s iPad and cloud computing to build a better healthcare experience.

They offer a free EHR platform built on the iPad that is Meaningful Use certified.  drchrono is also the first iPad EHR to implement real time clinical speech-to-text. drchrono handles everything a doctor needs to run their practice, including medical records, electronic prescribing, medical billing, and patient management.  For more information, visit

The drchrono iPad EHR is 2011/2012 compliant and has been certified by InfoGard Laboratories, an ONC-ATCB, as a complete EHR in accordance with the applicable certification criteria adopted by the Secretary of Health and Human Services. This certification does not represent an endorsement by the U.S. Department of Health and Human Services or guarantee the receipt of incentive payments. drchrono version 9.0 was Stage 1 certified on June 3, 2011. The ONC certification ID number is IG-2492-11-0083


What got me was the claim in the e-mail that accompanied the press release. “Today, drchrono, a hot Y Combinator start-up focused on Apple’s iPad and cloud computing to build a better healthcare experience, announced OnPatient, a groundbreaking app that digitizes the medical practice waiting room,” the message started. This was the same claim that drchrono included in a media advisory earlier in the week.

Sorry, there is nothing “groundbreaking” about software that collects medical history electronically and automatically populates an EHR with this information. Instant Medical History, a program from Primetime Medical Software, Columbia, S.C., has been doing this for years. Though it is primarily a PHR vendor,‘s name betrays one of its products, a patient portal for medical practices that collects patient history online. is similar.

No, IMH does not have a native iPad app, but it’s worked on tablets going back to the bulky Windows tablets circa 2003, even if few customers actually chose that option. is Web-based, which means it’s accessible from any device with a Web browser such as, say, an iPad.

When I called the publicist on the “groundbreaking” claim, I got this back. “Of the physicians I’ve spoken to, the user-friendly interface of the iPad app really makes patient onboarding easy and they love the ‘novelty factor’ of using the iPad as well. It’s less intimidating for patients who have limited experience with healthcare IT.”

Fair enough. But that doesn’t make OnPatient “groundbreaking.” The iPad is groundbreaking. OnPatient is interesting, useful and frankly, long-overdue competition to Instant Medical History. I hope it catches on. But it’s not much of a breakthrough.

I can’t wait to see the breathless coverage from the other tech press who don’t know the, ahem, history (sorry, couldn’t resist). If you want the unvarnished, occasionally acidic truth, come here.

For that matter, here’s the company’s own message, via video:

It’s rather low-key, actually. I have just one question: Why do they say “tax breaks” for meaningful use? The money is in the form of Medicare/Medicaid bonus payments. As EMR and HIPAA readers know, those payments are considered taxable income. Just sayin’.


HealthCentral’s Acquisition of Wellsphere – Much Ado About Nothing

Posted on February 3, 2009 I Written By

John Lynn is the Founder of the blog network which currently consists of 10 blogs containing over 8000 articles with John having written over 4000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 16 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of and John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit and LinkedIn.

Unless you’re a part of the health care blogosphere, you probably haven’t been following the incredible firestorm that health care bloggers have created around the acquisition of Wellsphere by HealthCentral. Here’s the cliff notes version:

  • Bloggers receive flattering email from Wellsphere asking to join their Health Care blogger network
  • Bloggers provide their blog feed to Wellsphere
  • Wellsphere aggregates their blog content for months
  • HealthCentral Acquires Wellsphere
  • Bloggers Freak Out
  • Bloggers learn that the TOS gave Wellsphere the right to sell their content
  • Bloggers feel betrayed
  • Bloggers flame Wellsphere and HealthCentral for acquiring them
  • Bloggers pull their blog feeds from Wellsphere
  • ? (still to be written)

Honestly, I feel like bloggers are making much ado about nothing.  Sure, the emails from Dr. Rutledge were incredibly flattering.  I had to literally tell myself when reading them that Dr. Rutledge had never read my blog.  He didn’t really know how good I am at blogging even though his email called me an “expert blogger” and a “true medical expert.”  Seems like many bloggers who got that email couldn’t read through the marketing gloss.  (See the full emails here)

I too joined Wellsphere and my experience was very much like this health care blogger except the part where he feels like a sucker.   I knew what I was getting into.   All that was suggested was getting more exposure for my blog and possibly more credibility and visibility for my name.  My blog being about Health Care IT I didn’t see the promised traffic and so I pulled my blog.  No harm no foul.

I think people are making a bigger deal out of having their content on Wellsphere anyway.  If you’re blog holds any weight, then there are tons of spammers all over the internet that are pulling in your feed and republishing it.  Having it on Wellsphere doesn’t change the value of your content.  In fact, in some ways it can add more value to your content since it links back to your original post.

Sure, I feel bad for those bloggers that didn’t understand what they were getting into.  However, do I think that Wellsphere was unethical in what they did: No.  I also disagree with Dmitriy who said that “Wellsphere epitomizes all that is wrong with the “Health 2.0 Movement.””  There are so many bigger issues with Health 2.0 than this, but I digress.   From my experience, Wellsphere did exactly what they told me they were going to do.  Do I wish they could have driven more traffic to my site?  Yes.  Did it happen?  No.  Oh well, it was worth a try and cost me almost nothing.

The funny part for me about all of this is that just last week I sent an email to a couple wellness educator friends of mine that were looking to creating a wellness website.  I sent them Wellsphere as an interesting example of building a community of people focused on Wellness.  When asked, I told them that Wellsphere was probably VC funded and as such would be looking for exit opportunities.  That’s just how a website like it works.  You build it to exit.  Most common of which is purchase by another company.  It’s just unfortunate that so many bloggers were unaware of the web VC busines model.  Don’t expect this to change anytime soon.

Since I’m the eternal optimist, let’s take a look at a couple really cool things that have happened because of the HealthCentral acquisition of WellSphere:

  • I’ve found a ton of really cool Health Care bloggers that I’d never known before
  • Health Care bloggers have never been more passionate and united in a common cause

Now if we can harness that passion and energy to something as important as health care and wellness, we can certainly do a lot of good.

Now, back to our regularly scheduled programming.