Quality Systems’ (QSII) wholly-owned subsidiary NextGen Healthcare’s inpatient solutions were recently selected by Mississippi-based Montfort Jones Memorial Hospital (“MJMH”). Under the collaboration, MJMH will deploy NextGen’s in-patient products such as the NextGen Inpatient Financials and NextGen Inpatient Clinicals in early 2012 to facilitate its migration to an automated healthcare IT platform. The implementation will coincide with the opening of a couple of new nursing units.
MJMH, with 71 licensed beds, is a general medical and surgical hospital serving the rural communities of central Mississippi. The entity has worked with the Mississippi Hospital Association to locate the most suitable solution for a small rural hospital with limited IT resources. MJMH has chosen NextGen’s in-patient solutions for its clinical and financial platforms based on the latter’s advanced reporting capabilities and extensive hospital experience.
NextGen’s in-patient products are extending their services to community and rural hospitals. On the in-patient side, NextGen acquired 8 new hospital clients in the most recent quarter, thereby taking its total hospital tally to well over 100.
Quality Systems develops and markets healthcare information systems that automate certain aspects of medical and dental practices. More than 90% of its annual revenues come from the NextGen division.
Quality Systems runs a pure-play business model in an attractive industry with a large number of catalysts. In recent times, the company has not only managed its ambulatory clinical deals, but in addition, has executed several enterprise contracts. Also, on the positive side, we derive comfort from the high proportion of recurring revenues and steady growth in NextGen's pipeline.
We are pleased with Quality Systems’ wide range of products, particularly those of its NextGen business, contributing to a diversified and growing revenue-base. However, competition is intense from well regarded players such as Athenahealth (ATHN), Allscripts Healthcare Solutions (MDRX) and Cerner Corporation (CERN). We are currently Neutral on Quality Systems.
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