Check out all the on-demand sessions from the Intelligent Security Summit here.

Health care reform’s emphasis on population health management is moving providers toward electronic health records systems that can document care in both inpatient and outpatient settings. That may be a key reason why the (formerly) outpatient EHR provider Athenahealth announced today at the J.P. Morgan Healthcare Conference that it has agreed to buy RazorInsights, an electronic health record and financial platform for rural, critical access, and community hospitals.

Athenahealth CEO Jonathan Bush said his company plans to leverage RazorInsights’ inpatient expertise and technology to extend its presence into the 50-bed-and-under hospitals, which accounts for about one-third of the total U.S. hospital market.

The Athenahealth cloud-based EHR system is already well respected and well established in medical group settings. The company says it now counts more than 59,000 health care providers as customers. The major analyst in the world of EHRs, KLAS, has awarded Athenahealth its “Best in KLAS” rating for its revenue cycle management, EHR, and patient engagement services.

Based outside Atlanta, RazorInsights has deployed its EHR at 25 leading health care provider organizations in 15 states.

The company got its start serving small hospitals, a financially challenged segment with a strong need for an affordable EHR system delivered from the cloud. Hosting a legacy EHR system on the premises can be a costly affair in terms of manpower and equipment.

Athena has built its business on the same assumption, so the two companies seem like a good match.

“Today’s hospital market is woefully underserved when it comes to IT systems and IT partners that are accountable for reducing costs, increasing quality, and enabling a better patient experience,” Bush said. “With RazorInsights, Athenahealth will immediately be injected into the inpatient care environment. This is a natural extension for our cloud-based services, will tremendously grow our network knowledge, and will accelerate our introduction of results-oriented, inpatient solutions that hospitals can confidently invest in and demand accountability from.”

Athenahealth’s CFO Krisi Matus added that Athenahealth typically spends about 60 percent of income from each new customer on customer acquisition costs, and that the customer lifespan averages 7 years. She says most of Athenahealth’s revenue is recurring revenue. “We already know where 80 percent of our 2015 revenue is coming from.”

Aside from its EHR, Athenahealth provides revenue cycle management and medical billing, patient engagement, care coordination, and population health management, as well as Epocrates and other point-of-care mobile apps.

VentureBeat's mission is to be a digital town square for technical decision-makers to gain knowledge about transformative enterprise technology and transact. Discover our Briefings.