A report from our favorite rumor mill, HIStalk, has McKesson selling off its portfolio of physician practice-centric health IT to ambulatory electronic health records vendor e-MDs. “McKesson will apparently exit the physician practice business by selling Medisoft, Lytec, Practice Partner and Practice Choice to e-MDs,” according to a reader comment posted on HIStalk Tuesday evening.
This could set the stage for McKesson, a giant in the world of medical supplies and pharmaceutical distribution, to exit the health IT market completely, with the possible exception of RelayHealth, the reader speculated.
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The health IT division, known as McKesson Technology Solutions or sometimes McKesson Provider Technologies, is just a tiny part of overall McKesson operations. It accounted for just 2 percent of McKesson’s overall $179 billion in revenues for fiscal year 2015, down from 3 percent in 2013, according to the most recent annual report.
The Alpharetta, Georgia-based IT unit dates to 1974 as HBO & Co. McKesson bought HBOC in 1999 and weathered a fraud scandal that predated the acquisition.
The 2015 annual report contained some clues about forthcoming divestitures. “We have undertaken additional strategic initiatives in recent years designed to further focus on our core healthcare businesses and enhance our competitive position. We expect to continue to undertake such strategic initiatives in the future,” McKesson said.
McKesson, headquartered in San Francisco, has already said it would sell off a portion of its international technology operations this year. In 2014, it unloaded its hospital automation business for $55 million.
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The HIStalk report said that e-MDs would buy the Medisoft, Lytec, Practice Partner and Practice Choice brands from McKesson. It kind of makes sense.
Since March 2015, Austin, Texas-based e-MDs has been owned by Marlin Equity Partners, which merged e-MDs into revenue-cycle management company MDEverywhere. In August 2015, Marlin Equity bought physician practice-focused IT provider AdvancedMD. The McKesson units could fit nicely in that portfolio.
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