Merge Healthcare (MRGE) recently decided to widen its scope through an agreement with Regional Medical Imaging (RMI), a Michigan based full-service medical imaging organization. As per the new deal, RMI will leverage Merge’s RIS v7.0 to meet the ‘Meaningful Use’ needs of imaging interoperability as well as strengthen its image management solutions.
It has been estimated that about 90% of the radiologists in US are eligible to qualify for the Meaningful Use incentives mentioned in the Health Information Technology for Economic and Clinical Health (HITECH) Act. This in turn implies that the entire diagnostic imaging community will be provided with an amount exceeding $1 billion.
As the US health IT (HIT) market is gradually adopting the electronic health recording system to meet the HITECH funding requirements, RMI based on 13 eligible providers, expects huge return, worth more than $600,000 from its Meaningful Use incentive.
Under the partnership, Merge will also offer its iConnect solution suite including iConnect Access, iConnect Share and iConnect Kiosk to RMI with which it will create image interoperability, share diagnostic quality images, eliminate CDs, attract and keep its referral base and boost its operational efficiency.
Merge is a global developer of healthcare information software solutions that helps prepare more comprehensive electronic records for the patients and deliver related services. Its strong product line for image management is expected to help meet the Meaningful Use requirements of RMI.
The medical imaging market has huge potential, especially with the government’s emphasis on HIT and an ageing population. However, Merge’s growth is highly dependant on advanced imaging solutions for which huge capital investments are needed to be made by hospitals. Moreover the competitive landscape of the HIT market with major peers like GE Healthcare (GE), Siemens (SI) and McKesson (MCK) is making it tough for Merge.
However the company has taken several initiatives to drive growth further, especially outside US. In the fourth quarter of fiscal 2010 Merge reported 23% of its revenue from the international market.
Also, the company has expanded its client base to over 2,200 imaging centers, 800 orthopedic clinics, and 1,500 hospitals and health systems, 1,200 laboratories and 250 OEM partners globally in order to boost further sales. Moreover, the company is also focusing on the emerging market with its iConnect platform.
We presently have a ‘Neutral’ recommendation on Merge.
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