In a move that could have significant implications for the future of medical records, Microsoft has agreed to acquire Nuance Communications. Microsoft, which paid a cool $19.7 billion for Nuance, has cemented a place as a leader in the growing market for AI-driven, hands-free automated clinical documentation.
The deal, which was announced in mid-April, gives Microsoft a leg up in the healthcare cloud market which could prove very valuable as medical dictation migrates from a model trapping physicians behind a desk to one which can capture conversations between doctors and patients and support these documents with AI-driven data and insights.
The Nuance deal also gives Microsoft access to a deep pool of healthcare industry experience. Nuance has been in the medical dictation business for what seems like forever, and its SaaS-based Dragon Medical One and Power Scribe One clinical speech recognition are well-established in the healthcare business. In fact, according to the vendor, its solutions are currently used by more than 55% of physicians and 75% of radiologists in the US as well as 77% of US hospitals.
Microsoft has been working with Nuance on so-called “ambient clinical intelligence” since at least 2019. Ambient clinical intelligence is software that listens to clinical conversations doctors have with patients, integrates this content with other information from the EHR and generates a medical summary automatically.
More recently, in late 2020, Microsoft announced a deal in which Nuance’s Dragon Ambient eXperience (DAX) was integrated into Microsoft Teams. DAX is build on an ambient clinical intelligence model, and is only likely to get richer as it draws on resources such as the specialized Microsoft Cloud for Healthcare. Check out this healthcare CIO Podcast to hear a first hand user experience with Nuance’s DAX solution.
Meanwhile, Nuance has continued to strike other deals of its own that forward its next-gen provider development efforts. For example, in November last year Nuance announced it had struck an agreement with Providence, a sprawling health system with 51 hospitals in seven states. Under the terms of the agreement, Providence will use Nuance’s cloud services and integrate clinical intelligence into his infrastructure. All this is a cavalcade way of saying that Providence sees the benefits of ambient clinical technology.
As readers know, I have often been critical when large tech players make big moves in the healthcare space. For example, I’ve been pretty skeptical about the impact Amazon will actually have on the telehealth market.
In this case, however, I think the alignment between the two players works. By capturing Nuance, Microsoft has taken a tangible lead in the battle to make medical dictation both liberating for humans and enhanced by the capabilities of AI. Given its position as a trusted vendor in the dictation space, Nuance is in a unique position to serve as a platform for next-generation ambient clinical intelligence platforms.
If the two companies get the integration process right, this could be a very consequential deal indeed.
