Declining physician visits, payments contribute to disappointing athenahealth Q1
- Athenahealth’s first quarter revenue totaled $285.4 million, up 11% from $256.1 million in the 2016 first quarter, according to the Watertown, MA-based company.
- Operating income was $1.1 million for the first quarter of 2017, or 4% of total revenue, compared with $300,000, or 1% of revenue the previous year.
- However, the company reported a net loss for the period of $1.4 million. After the earnings report, common stock shares dipped 19.4% by close of business last Friday.
Based on its first quarter results, athenahealth now expects 2017 revenue in the $1.21 billion to $1.25 billion range. Earlier this year, the company forecast full-year revenue would be between $1.29 billion and $1.33 billion.
“We’re making progress on our strategic priorities,” Karl Stubelis, chief financial officer at athenahealth, said in a statement. “In the first quarter, we continued to reduce client work, enhance our offering in the small hospital market, and invest in our platform to support our growth.”
CEO and President Jonathan Bush cited declining visits per physician and declining payments per visit as the main drivers of the revenue loss. "I believe some of this is the national breath-holding around what Trumpcare is going to be and some of this is the continuing rise of deductibles," Bush stated on an earnings call. "But those are my hypotheses about the causes. The facts of the matter are the visits are down a little and the payment per visit is down a little."
Earlier this year, Bush told Healthcare Dive that the company’s 2017 focus would be on providing flat out cash savings for providers and creating a national patient index and national calendar that acts like Open Table or TripAdvisor.
In August, athenahealth purchased mobile care coordination platform Patient IO for an undisclosed sum. The web-based platform — which forms the basis of athenahealth’s athenaWell patient-facing mobile app — allows patients to manage their medications, review care instructions and record self-reported data.
Company officials expressed confidence in the company’s future and the trend toward more networked healthcare. In a recent interview with Healthcare Dive, Kyle Armbrester, chief product officer at athenahealth, said the personal health record in an EHR system is really a baseline for what EHRs can accomplish. The company is currently pushing mobile capture applications and incorporating electronic prior authorization for prescriptions.
"One thing we all took for granted is that athena would know its revenue a year out," Bush said on the earnings call. "The one place that we all need to get our confidence back is understanding the activity in the practice. And believe me, we're studying it."
- athenahealth athenahealth, Inc. Reports First Quarter Fiscal Year 2017 Results
- Becker's Health IT & CIO Review athenahealth net loss hits $1.4M in Q1