Streamlining Hospitals: Omnicell CEO Randy Lipps (Part 7)

SM: What kinds of products would you like to bring in?

RL: They must leverage our market share. I know our customers would prefer to purchase from us if we have the products they want. We are very careful not to mess up the salesperson’s relationship with the hospitals. I like to say that we have the highest compensated sales force, and I am proud of that. I want the best people possible.

We will also look at other businesses where our technology becomes an enabling technology. There are a lot of nuances in the world of healthcare. With different high-cost drugs, there is a lot at stake. Taking on different business models may let us go direct to certain manufacturers.

SM: Would you consider doing SaaS?

RL: A little bit. It has to be software that is connected with the supply chain. I don’t think you can just sell software packages today. Even if we have the best, easiest services to use, I walk into a hospital where they have high-end, feature-rich systems, and it is like the old VCRs. Users push play, rewind and stop but never use the other features. I am trying to figure out how to make it like a TiVo where they are no buttons on the front and people do not have to think about it. That is the real problem with healthcare IT. Products exists but the adoption is too hard to take on. The average OR nurse is 54; you are not going to have her sit down at a laptop and type things in. You have to give her something that requires no training.

SM: You have been at this for 15 years. How much personal interest do you have remaining?

RL: I will be at this 15 years more. It is not about the money for me, unbelievably so. I have had more offers to sell the company than you can count. I have real people with real families who enjoy their work that this company supports. I know what happens when you sell a company. That all changes if you sell the company. I am having a good time and I am not wired for anything but work.

SM: With all the stuff going on in the government, and the political will to do healthcare IT, it seems like you are streamlining healthcare. To what degree do you see your company benefiting from this attention?

RL: I don’t know that we will directly benefit from the way healthcare IT money was allocated. The way I look at it, healthcare is a fixed resource in the US. You can’t put a whole lot more into it. The more efficient you become, the more people you are not leaving standing on the outside. Every time we produce a product it is always more efficient than the last one, which means we are leaving fewer people on the outside. I am a tyrant in that anything we produce will not result in ‘busy’ work for our end users. That is not good use of a healthcare dollar.

I think we will benefit because the government is sending the message that efficiency matters. The way to get to that efficiency is via electronic medical records. The penalties and rewards will be more if they do. I am impressed that with everything that is going in the economy, the stimulus package sent the right message.

SM: The only problem is the deficit, which is completely out of control.

RL: It was only $19 billion of the deficit. I don’t know what all the other stuff was for. What surprised me was with all the other concerns, they still had the time and initiative to get that piece put in.

SM: I think it remains to be seen. I have been talking to a lot of healthcare businesses, and it seems as though there is momentum right now on the healthcare side.

RL: Most of the money was going to doctors’ offices, and most of the issues are in those offices. There are issues with data interoperability between doctors’ offices and hospital systems. I just wish the government would try to set a standard that all medical records need to look like ‘x’. What you have today is that every HIS has its own format. The only way doctors’ offices get tied into the hospital is by using the same system as the hospital.

SM: Thanks. This has been a great story.

This segment is part 7 in the series : Streamlining Hospitals: Omnicell CEO Randy Lipps
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