Cerner world headquarters in North Kansas City, Missouri
|Traded as||NASDAQ: CERN
S&P 500 Component
|Headquarters||North Kansas City, Missouri, U.S.|
|Key people||Neal Patterson
(Chairman and CEO)
|Products||Health informatics software|
|Revenue||US$ 2.910 billion (2013)|
|Operating income||US$ 576 million (2013)|
|Net income||US$ 398.3 million (2013)|
|Total assets||US$ 4.098 billion (2013)|
|Total equity||US$ 3.167 billion (2013)|
|Employees||14,200 (End of 2013)|
Cerner Corporation is a global supplier of health care information technology (HCIT) solutions, services, devices and hardware. Cerner solutions optimize processes for health care organizations. These solutions are currently licensed by approximately 9,300 facilities around the world, including more than 2,650 hospitals, 3,750 physician practices, 40,000 physicians, 500 ambulatory facilities, 800 home health facilities, 40 employer sites, and 1,600 retail pharmacies. As of December 2013, the company had more than 14,200 employees globally.
Cerner is the largest publicly traded company focusing solely on health care information technology in the United States. McKesson and GE are larger in size, but both companies have income from non-technology health care sources. Cerner’s main competitor is Epic Systems.
Cerner was founded in 1979 by Neal Patterson, Paul Gorup, and Cliff Illig, who were colleagues at Arthur Andersen. Its original name was PGI & Associates but was was renamed Cerner in 1984 when it rolled out its first system, PathNet. It went public in 1986. Cerner's client base grew steadily in the late 1980s, reaching 70 sites in 1987, 120 sites in 1988, 170 sites in 1989, and reaching 250 sites in 1990. Installations were primarily of PathNet systems.
During this time, Cerner was developing components of a Health Network Architecture (HNA), an integrated IT system designed to automate health care processes. Clients could purchase individual components or the whole system at one time. By 1994, more than 30 clients had purchased the full HNA system, while 100 clients had purchased multiple components of the system.
Cerner began to expand globally in the 1990s as well, establishing presences in Australia, England, Canada, Singapore, Saudi Arabia and Germany during the decade.
In 1997, the company introduced Cerner Millennium, an upgrade to its HNA system which incorporated all of the company’s software offerings into one unified architecture. The introduction of Millennium contributed to significant growth for the company, with revenue increasing to $1.1 billion in 2005 from $245.1 million in 1997. Ten years after its introduction, in 2007, Millennium had been successfully implemented in more than 1,200 facilities worldwide.
In July 2010, president Trace Devanny left the company. "Devanny’s responsibilities will be absorbed by the current organization. Neal Patterson will become the company’s president, in addition to his current role as Cerner’s chairman and chief executive officer."
Cerner is headquartered in Kansas City, Missouri. Cerner's world headquarters (WHQ) campus is across the street from North Kansas City Hospital, Cerner's second hospital client. In 2005, Cerner acquired the Riverport Campus complex on the site of what was formerly the Sam's Town Casino above the Missouri River in North Kansas City, Missouri In 2006 it also acquired the former Marion Laboratories complex in southeast Kansas City, Missouri, renaming the campus the Innovation Campus. In 2013, the company opened the first building in a new campus development located in Kansas City, Kan. The company calls this the Continuous Campus. In early 2014, the company announced that it had begun a $4.3 billion campus construction project on the site of the former Bannister Mall in south Kansas City near the Innovation Campus.
Cerner maintains a handful of additional offices in the United States, as well as offices in the UK, Australia, UAE, Saudi Arabia, Egypt, Germany, France, and several other countries.
- Cerner Anasazi - Arizona
- Cerner Belgium, Inc. - Delaware
- Cerner BeyondNow - Missouri
- Cerner Campus Redevelopment Corporation - Missouri
- Cerner Canada Limited - Canada
- Cerner Citation, Inc. - Delaware
- Cerner Corporation PTY Limited - New South Wales (Australia)
- Cerner Deutschland GmbH - Idstein, Germany
- Cerner DHT, Inc. - Waltham, Massachusetts
- Cerner Etreby - Garden Grove, California
- Cerner Healthcare Solutions Private Limited - India
- Cerner Health Connections, Inc. - Delaware
- Cerner Iberia, S.L. - Spain
- Cerner India - Bangalore
- Cerner Bangladesh - Bangladesh
- Cerner Innovation, Inc. - Delaware
- Cerner International, Inc. - Delaware
- Cerner Investment Corp. - Nevada
- Cerner Ireland - Dublin
- Cerner Latin America - Latin America / Caribbean
- Cerner Limited - United Kingdom
- Cerner Middle East FZ-LLC - Emirate of Dubai, UAE
- Cerner Multum, Inc. - Denver, Colorado
- Cerner Physician Practice, Inc. (formerly Vitalworks) - Delaware
- Cerner Project IMPACT, Inc. - Delaware
- Cerner Properties, Inc. - Delaware
- Cerner Radiology Information Systems, Inc. - Houston, Texas
- Cerner, SAS - France
- Cerner Singapore Limited - Singapore
- Cerner SDN BHD - Malaysia
In 2005, Cerner and other companies paid for a report by the RAND Corporation which predicted great efficiencies from electronic health records, including savings of $81 billion a year or more, which RAND now says is overstated. This report helped drive growth in the electronic health record and billions of dollars in federal incentives to hospitals and doctors. Cerner's revenue has tripled from $1 billion in 2005 to a projected $3 billion in 2013. The study was criticized by the Congressional Budget Office for overstating potential savings. A 2013 reassessment of the 2005 report by the RAND Corporation said that the conversion had failed to produce savings and had mixed results in efficiency and patient care.
In 2010 Girard Medical Center, Crawford County, Kansas, hired Cerner to install an electronic records system. But after receiving $1.3 million, Cerner employees failed to get the system running in time to qualify for federal incentive payments, and notified the hospital that it was abandoning the project, according to a lawsuit Girard filed against Cerner last year. The case is in arbitration.
Phillip Longman, a senior fellow at the New America Foundation, said that the installation of a computerized health system by Cerner in the Children's Hospital of Pittsburgh of UPMC in 2002 made it harder for the doctors and nurses to do their jobs in emergency situations and resulted in a "disaster". Longman wrote, "According to a study conducted by the hospital and published in the journal Pediatrics, mortality rates for one vulnerable patient population—those brought by emergency transport from other facilities—more than doubled, from 2.8 percent before the installation to almost 6.6 percent afterward."
Defenders of Cerner in the study charged that the Pittsburgh hospital did not adequately prepare for the transition to the CPOE system in that it had at the same time significantly changed its pharmacy process, did not provide adequate wireless bandwidth, and did not have order sets pre-programmed on day one. They noted that other hospitals that more carefully planned the implementation did not experience the same problems.
According to a memo published online allegedly authored by CEO Neal Patterson in 2001, a program of strict employee control was instituted due to some behavioral patterns and evidence Patterson perceived as being indicative of underachievement by Cerner's employees at the company's Kansas City office. Evidence used was primarily the CEO's perception of the fullness of the company parking lot at the hours of 8 a.m. and 5 p.m., a metric he planned to also use to gauge the response of the employees to the program's new rules. The program itself consisted of such changes as staff reduction, a hiring freeze, closing of an "Associate Center", and the implementation of a punch-card system.
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