ASPs face off against a thin-client

Saturday, April 30, 2005

DULUTH, Ga. -- After a 2-2 tie since last summer, CareCentric's introduction of Ac-Cura HME has tipped the ASP (application service provider) trend in favor of programs that require the installation of software on a supplier's computer.
Currently, two HME business software programs -- Brightree and Bonafide's MedeQManager -- offer pure ASP plays; in other words, users can access their billing system from any Web browser at anytime, anywhere.
Two other HME software companies -- Fastrack and QS/1 -- offer licensed, turnkey systems as well as ASP alternatives. Like CareCentric's new system, these ASP alternatives, also known as on-demand systems, require users to install a 'thin-client' that opens the door to the company's online software.
The ASP alternative attracts smaller companies that are reluctant to make large up-front investments. Instead of buying a turnkey system that could cost tens of thousands of dollars, the ASP option costs about $1,500 for training, and then a monthly service fee that costs perhaps $500.
Today, both QS/1 and Fastrack each report that about 10% of their new customers are choosing the thin-client ASP option. At Fastrack, company president Spencer Kay doesn't expect his percentage of ASP business to grow beyond 10%.
"Interestingly enough, and surprisingly enough, people are switching from the ASP to a licensed system after 18 months or two years," he said. "On a hosted system, long term, you will probably end up paying more than if you licensed it."
But paying less is one of the independent ASP's leading arguments in favor of their model.
"What we are charging on a subscription basis for clients will be a fraction of what people are used to spending with other legacy products," said Brightree President Dave Cormack. "We are charging not much more than their customers are currently paying for maintenance."
The other great selling feature of an independent ASP is liberation from the office. After 17 years in HME billing, Carrie Johnson started her own billing company, C&S Billing Center, using Brightree partly because her employees could access the system from home.
The ability to tap the system has also been a boon for her customers, who do not have to wait for periodic reports from their billing company.
"Here, they can look and see if we have talked to a patient, provided we put the notes in there," said Johnson. "They can generate reports on their AR, instead of having to call me. That's been phenomenal."