Founder Stories: Judy Faulkner, Founder and CEO of Epic Systems

Especially the software developers are required to go on what we call immersion trips. In the very beginning, they have to go to about 5 immersion trips. So maybe you go to the OR, you're a developer, you're going to develop in the OR, you go to the OR, maybe you faint, that's happened, but you have to get back up again and keep going and learn what's it like to be in an OR. And that's when they're thinking, how can I make things better? How can I watch what isn't going well enough? And that's the best way you can see it if you're an individual software developer. Get there and actually watch it. So there's so many different ways that innovation comes in.

You're listening to A Second Opinion, your trusted source engaging at the intersection of policy, medicine, and innovation, and rethinking American health. Judy Faulkner is the founder and CEO of Epic Systems. Judy started Epic in 1979 in a basement in Madison, Wisconsin, and 41 years later, More than 250 million individuals have an Epic electronic record. In our discussion today, Judy takes us back to the start of Epic when she was a student lured into the new field of computer science and the journey that brought her to where she is today. She has single-handedly changed the course of health service delivery, improving the health of millions around the world. One of the few self-made women billionaires, Judy has signed the Giving Pledge started by Bill and Melinda Gates and Warren Buffett, pledging 99% of her assets to philanthropy to help others. I'm your host, Senator Bill Frist. Welcome to A Second Opinion.

Judy, it's great to have you on today's show. You know, you started Epic Systems 41 years ago, and This story I know, but I want you to recount it in a basement in Madison, Wisconsin. And then you jump ahead 41 years later and you have more than 250 million patients, patients, and you can correct that, in a current electronic record on Epic today. And so many accolades. Forbes has named you the most successful female technology company founder, and the list goes on. Back in 1979, I was just a surgical intern at Massachusetts General Hospital. So let's go back to that year. Take us back then, 1979, and share that epic story.

Okay, 1979. Um, I had been working at the University of Wisconsin helping folks with the system I had written, so I've got to go back a little bit earlier than '79. So I'm a math major undergraduate. When I was in, uh, college as a math major, I took a summer job in University of Rochester in particle physics, which I knew nothing about. And when I got there, they expected me to program. Well, I had never seen a computer. And so they gave me a Fortran book and a week of access on the computer. And at the end of the week, they said I was a good programmer. I've never figured out why anybody needs more than a book and a week. And at the end of the summer, we had a couple papers published. And so then after that, I went back to college, applied to graduate school in math, and two schools by themselves moved me to computer science. And at that time, you— we didn't even know that computer science was an option. It was a brand new discipline. So I thought that was really neat. I get to play games because that's, to me, what programming was, a lot of playing games. So I went to University of Wisconsin. And I took a course in computers and medicine, probably the first course offered in the world in computers and medicine, taught by Dr. Warner Slack. And he asked me to work with him and his team, and I did. And at one point they brought me in and said that they wanted me to develop a system that would keep track of patient information over time, no matter whether the patient was there once, or was there lots of times, was inpatient, was ambulatory. They wanted the record of the patient. And they also wanted to be able to define their own data elements and design their own screens. This was at a time where the systems that were available were lab systems or billing systems, and they were written typically in COBOL. And if you wanted to make changes, you had to change the source code, but they wanted to be able to themselves make changes. So what they wanted was the database management system, but this was before Oracle or Sybase or dBase or any of those things. So I found a little system that Warner had worked with or was working with at the Beth Israel, and it had the concept in there of a database management system, which was great. So I built Chronicles, which is the underlying infrastructure for Epic. They tell me that not a single line of code is still in use that I wrote, so everybody can relax. And my customers around the university hospital started using the software, and I would be with them and sit with them and learn, uh, what about rehab medicine, what about psychiatry, what about OB-GYN. I'd learn different things. It was really very, very instructive. And by the way, one of the things I did was I put the patient at the center and all the data around the patient. So whatever that data was, if there was new needs to get at that data, you didn't build a different system. You just grew that system, leaving the patient at the center. And that became very critical for what we did and still do.

All this was clinical data.

At the time, this was all clinical data. People will often say, oh, you started as a billing system. We had no idea what billing was. And a group came to us and said they wanted billing. We said, we don't know what it is. They said, oh, it's very simple. There's a price for the procedure. You do that, you bill the patient, they pay something, and you subtract, and you keep the running total. We said we would charge them $3,000 for an entire billing system.. And I think a year or two later and a huge amount of money that we spent on ourselves because we stuck with the $3,000, we finally got them a billing system. So we had no idea what billing was.

Keep going with your story. Cause I love it. But in 1975, '76, '77, '78, I remember, um, you know, this was when I was in my medical training, it was history of present illness or chief complaint, history of past medical history, your medication review, a system physical exam. Is that the structure that you started with?

We didn't start with a structure. We started with just the ability for everyone to define their own structure. Yeah. And some of them put in the SOAP notes, some of them did not, but each one could do it their own way, which I think became very important because 3 different groups did tumor registries. And we kept saying to the second one, why don't you use the first? To the third one, why don't you use the first or the second? They all wanted it their own way. So that's how we started. That's not how it is now, but that's how we started. So I kept getting phone calls from my customers saying, Judy, start a company. My peers out there want access to the same system. And I would say no. And after 2 years, I said, okay. And so we started with 1.5 people in a basement.

That's the start.

And then where'd it go? Give us a— summarize those, those first few years and then, then run us through everything. We'll, we'll come back in more detail, but You know, I took us as 250 million people. Is that the correct figure today?

I think if you look just at the US, it's 240 million, something like that.

And then how big are you globally? And we can come to that a little bit later. Is that an area that you will grow to over time?

Yeah, we're in 15 countries now, and it's not easy being in different countries with different languages. We now have to deal with the fact that in French, the nouns can be singular, and I'm sorry, male or female, and you've gotta have le or la appropriately before each one. And that's a lot of programming to rewrite your software so it takes care of the nouns properly.

And then how many, how much of the, say 240 million people, how much of the hospital market, again, for our listeners and our viewers, just to get a feeling for your size, how much of the hospital market do you have and how much of the outpatient market? That's probably harder to define, but again, just rough estimates.

I think if you look at the hospital market, we have about 26% of the hospitals, but we have about 46% of the beds because we tend to work at the larger places.

And over time, do you see yourself going to the smaller hospitals as costs come down and scale is realized fully, will you come down? I know it's a big investment for these hospital systems, but do you see yourself coming down to mid-sized hospitals and smaller hospitals over time?

I think we already do a lot of them, but we do a lot of them as health systems who may have 6 hospitals, and some of those 6 are small. We are putting together something we're calling Garden Plot, where it's one system that's shared by different hospitals or different ambulatory care groups and it allows the smaller ones then to work together as one and save money that way. So we are trying that.

You know, let me pick a couple of really interesting things that I have questions about. I kind of know some of the answers 'cause I've read so much about you and admired you for such a long time. But we got SPACs coming out of our ears these years, especially this year, and IPOs are exploding. But it's always been important to you to remain private and employee-owned. Tell me a little bit about that.

Yeah, there's, I think, quite a few things that really haven't changed. We're private. That allows us to avoid the tyranny of the quarter, allows us to focus on R&D. And I say one of the reasons we're not publicly traded— sometimes I tell people it's because I road on airplanes, and I'd sit next to somebody who would tell me about how their company just went public or how their company was just acquired. And I'd always ask, did it turn out good? And I would say 90 to 95% of the time they would say no. So I tried to figure out, would we be in the category of the no or the category of the yes? And when I thought about the types of groups that said no, I thought, let's stay private and let's not be acquired and let's never acquire anyone. So those three things are still part of who we are.

You know, so many people that I come in touch with through the venture world, I talk to the CEOs and literally they spend half their time raising money. And I always tell them that's just part of the business today. But then I run into someone such as you, And the time was a little bit of a different time back, you know, through the '80s and '90s. But if people said, well, I'd like to do the same thing, I'd like to keep my company private, and I want to share sort of the, the, the interest with my employees, is it still as easy to do today as— not that it was easy back then— or as possible to do today as it was before?

Oh, I think so. I don't see any reason why it's not possible.

Yeah, that's got to be what you want to do.

Yeah. And then, then are you employee-owned?

We are employee-owned almost totally. We still have some initial shareholders who have— were part of the initial group, because when I formed Epic, I went to my various customers and asked who would like to be part of the company, but they would buy shares and do what we would now call sweat equity, but I didn't know the words back then. And they all said yes. And so they are some of the original shareholders.

And you're right now another interesting thing. I think that, that people will say, how do you get away with this? And that is that Epic is famous for spending very little on marketing in spite of this tremendous growth to where you are today, covering, you know, people in almost every community of this country. Is there a particular secret to that? And explain the why or how you've been able to accomplish that with no, very little in the way of marketing.

Sure. And if I could first add one more thing to my previous answer, when the folks were allowed to buy shares in the company, we valued the company at $70,000. So if you got 10% of the shares, you paid $7,000 and they got very good returns.

I'll bet they did. I'll bet they did.

I'll bet they did.

So your question about marketing, well, When I was going around at the University of Wisconsin Health System and working side by side with the doctors, they would say to me, and I remember their words, it was, Judy, when you start a company, don't advertise because we don't believe it. Now, only in the last few years has occurred to me, I wonder why they said when you start a company, because I didn't know I was going to start one. But anyway, that's what they would say. And I always feel you have to listen to your customers, and they were my customers, so I listened to them and I did what they said, which was we didn't advertise. And we still don't. We don't do cold calls. We don't knock on doors. It's just word of mouth. We are entirely reactive. So if we have 11,000 people, how many would you— how many salespeople would you guess we have?

I don't know. Now that I know, I'd say very few, but go ahead, tell me.

Okay.

We have 7 worldwide. And so being reactive has worked for us because then people self-select and they only call us if they're interested. So it works a whole lot better that way.

And it helps that you start with a great product that you know that people need and that people are looking for and, and producing a superior product to competitors or people who are trying to do it. It makes it a little bit easier there, but it is amazing that you've been able to accomplish. Are your revenues reported? I don't want to ask you the— well, it's— so it's not reported.

Okay, we don't have to report them, but I'm happy to tell you that our revenues are, uh, what is it, about $3, $3.5 billion. And because of COVID we did so much for free that we are coming in about $500 million less. That we could have earned if we had charged for things, but we did a lot of COVID things for free.

Yeah, let's, let's talk a little bit about COVID I don't want to come back and, and ask you some of the other things you're doing outside of records, but while you mention COVID, you are the technology partner to so many health systems and physicians' practices on the front lines of the COVID-19 pandemic. How have you and the, the Epic technology and systems responded to the, the response and aided people in the response over the past 9 months?

Well, in a lot of different ways. One thing we've done is we have extended our software into lots more beds. We calculated it was about 92,000 beds that we've added on since COVID began. We installed McCormick Place in Chicago, Javits in New York, the US Navy ship Comfort. We just recently did the Milwaukee Field. Some of those have not been needed, which I think is wonderful. But what we found is that we became the experts in how do you go into a state and help the government install systems because we've done it place after place. That's one thing we've done. We've, of course, set up telehealth all over the country. Telehealth was in, I think we put it into 200 different customer sites. And trained about 5,000 people, and some of our customers went from 30 telehealth visits a day to 8,000 a day. We did a lot of drive-throughs, and some of the things I think are really neat are we would hear our customers say, maybe this medicine is or isn't working. Or I remember in particular, We found out that because we didn't have enough ventilators, that if we put the patient prone or on his side, survival seems to be better. And we thought, my goodness, we're talking to so many people around the country. How do we get this information shared? So we created a brand new website that is a healthcare journal now called EHRN.

Org.

It stands for epichealthresearchnetwork.org. And we started studying all the data we have because our customers are sharing the data with us. They're putting it into something we call Cosmos. Cosmos now has about, I think, 70 million records in it, and hopefully it will get to the 200 and some million. And we can study Cosmos and then quickly present the information in EHR and also present information that our customers have gotten. So COSMOS is observational data that we're studying and then presenting.

And people opt into that to be a part of a larger system to be able to report and to figure out what trends are out there?

Sort of. EHRN, they can— anybody can get to. That's available to everyone, ehrn.org.

And that's the, that's the Epic Health Research Network.

That's right. Cosmos is available for use to those who contribute the data and to Epic, and that's restricted that way, which we feel is very important. Now, what Cosmos is going to do in the end, which I think is wonderful, is what we call best care for my patient. So I have been told that typically there's about 10% evidence-based medicine. The other 90% is anecdotal or whatever you can do to try to come up with the best answer you can get. So now we have this huge database, and when you're seeing a patient, Cosmos then can look for other patients similar to yours and tell you what has worked best for patients like yours. So we think Cosmos is going to be really important that way. A couple other things is going to be, of course, a great research, uh, source. And then I think another thing that's going to be important is what we call lookalikes. And if you've seen a patient unlike anyone you've ever seen before then Cosmos can search over millions of patients to try to find others similar and then link the caregivers together.

You know, just as from a clinical standpoint, a physician's standpoint who's been faced in the heart disease, in the heart transplant world, it would be so beneficial because all of us were trained, um, basically through 4 years of medical school and 5 to 8 years of of training. And then other than peer-reviewed articles, which came daily but were hard to get through, you really didn't have that large database to, to access. And that, that balance between art and science, it was a balancing act. But now we can rely on a lot more science, and it's having those databases is going to go a long way to, I think, lead to much higher quality of care. Just while we're on this, because I know that some people are thinking individuals about something that you have addressed from day one and addressed it so well, and that is, uh, the privacy issues. Um, well, I'm a patient, I'm going to a hospital, it has Epic, and it, you know, makes it fantastic for the providers and for giving good care, but the data on me that goes into that Epic record system, how am I protected?

Well, first of all, from the health system, as you know, there's HIPAA rules that the health systems are very good at observing. And our software does allow you to protect individuals if you don't want their data shared. You can omit someone from that. What we find now is interesting. In the very beginning, people were a little nervous about their data being shared, and now we're finding that it's the opposite. Patients get upset if their data isn't shared.

I don't know if that answers your question.

Yeah, no, it does.

No, it does.

I think the idea of a personal health record and you might elaborate on this, the difference between a personal health record and an electronic health record that's in a hospital. Is there any difference between the two?

People have talked about you should be able to control your own medical record, bring it around, bring it anywhere you want. We do have a system for that. It's called Lucy, named after the Beatles and the Sky With Diamonds. So you can use Lucy to pull your medical data together and bring it wherever you want. But what we have found is people really would rather that you, the doctor, keep their information. You keep it accurate, you keep it up to date, you collect it from others so that you have everything that you need. And we haven't found a huge interest in people, uh, really managing their own, even though people talk about it a lot. The actual results that we see are, uh, they would rather you do it.

The whole world of interoperability, which just kind of leads me to, uh, Epic in the past has has received criticism, and especially from competitors, on being a closed system, one that does not make it easy to exchange data. And I have heard you respond and take that characterization, and I'd love for you to sort of share that with, with our listeners and viewers, because it's something I'm sure you've heard a million times, and we'll probably hear it a million times in the future. And just based on what you've said in the last few minutes, clearly that's not that's not the case, but what is your response to that criticism?

Well, we invented interoperability, actually. We did that because my husband, who's a pediatrician, his patient— he had a patient who died when she went to the wrong emergency department and they didn't have her record. And he kept saying, if they knew what to do, it would have been easy. He said that over and over. So I went to the HIMSS board and asked them, when is there going to be standardization of data so we could share it? Because if it's not standardized, then you can't exchange it because two systems can't talk together. And they told me not to hold my breath. So I went back to Epic and I said, well, we can't exchange with others yet till it's standardized, but we can at least do it for Epic. So we started writing interoperability somewhere around 2005. So now this would be the 15th anniversary when we started interoperability. We wrote the software and then we tried to get people to use it and nobody would use it. They all said it was too scary. The lawyers and the compliance officers would say no. Finally, two groups said yes, Memorial Care and Talbot. And what was funny is we had a talk given by one of the CEOs who said that his CIO came in, handed him a piece of paper, and said, I need you to sign for this piece of software. He signed it and didn't even think about it. And he said if he had known, he would never have signed it. So it was pure luck that we got that. Done. And so, um, that is how we started. And then they started telling everybody how great it was. And I brought a picture with me so you can see it. That's Francine. She was the first person ever to have her information shared, and her son is a software developer, so she knew he would be very proud of her. And she wanted us to show her picture everywhere we could.

I love it. That was that year, for those people who aren't on video, is what, 2008?

Yes, it was 2008, exactly.

What, what about— and we talked on this podcast as they were being developed— the two interoperability rules that HHS in Washington put out initially? It has been finalized, and the words that HHS used were that these interoperability rules and I quote, will give patients unprecedented safe, secure access to their healthcare. Um, you, you've walked through it, and I think you participated in, in the final evolution of those rules, uh, quite actively, as so many others did.

Yes.

Um, will they help the patients that much? And you might summarize for, for me and our listeners what fundamentally is in those rules, and then will they, they actually help patients?

I think there are— it's important to know that there's two kinds of interoperability. The one that I just talked about was provider interoperability, where you go to another healthcare organization, your record goes with you so that you can be treated appropriately. And that's the one that we wrote that I just showed the picture of Francine. And I think that's absolutely critically important. In fact, The two problems with it are one, data has to be standardized because you can't share data that isn't standardized. And we have like 150,000 data elements in our database. And only a small amount proportionally are really standardized. The second thing is you've got to have interoperability capabilities, your software has to be able to do it. And if you can't do it, then it's like trying to send someone a fax who doesn't have a fax machine. It simply doesn't work. So those are the two things. We were the first vendor by far to have every single one of our customers able to interoperate for a couple reasons. We retrofitted the software so that even if it was 2012 software that they had and it was 2018, we retrofitted our interoperability software to push it into their system. There's two kinds of interoperability, as I said, the provider interoperability and then the second one is app interoperability. App interoperability is different because you mentioned the privacy concerns earlier on. App interoperability reminds me a little bit of email where you might get an email and you have to know, do I click on this link or do I not? Is it safe or is it dangerous? And that's the concern with app interoperability. So we tried to work with the government to be allowed to query the app and then educate the patient by saying, here's what the app says it will do with your data.

In that final ruling, what do you think if the government hadn't gotten involved and helped sort of define it, what would it be like? And then what is it going to be like now that these interoperability rules have been finalized?

I think everybody was working on interoperability anyway. I mean, the patients wanted it, the health systems wanted it. Sometimes I hear people saying that the health systems don't want to lose the patients because then they'll lose money, or the vendors, EHR vendors, are worried about losing money if they do interoperability. Certainly, I don't know how we would get paid for someone not interoperating or interoperating. The interoperability is free. But I've never met a health system that doesn't want to interoperate. They all want to share that data. They want to make sure that when their patient goes somewhere else, that patient is going to be cared for. They want to make sure that when they get a new patient, they're going to have the data. And they're very proud of all the interoperability they do. So I think that they would have continued on anyway. And I think that there's going to be more interoperability with apps. And I think that the key is make sure it's safe interoperability because the apps are not HIPAA required. They don't have to follow those rules.

Julie, let me—

I know we will run out of time here shortly. Let me jump to a couple of other issues. And passing through my mind when you were talking about all these huge amounts of data with this many patient records, and again, all privacy protected coming through, but artificial intelligence. I was talking with Rich Whitney, who runs Radiology Partners, and we were talking about how artificial intelligence— and this was on the podcast— maybe 2 weeks ago, will change the field of medical imaging in so many dramatic ways. Are you using AI? You have the collection of data and you see some of these patterns. How is AI changing the health record business?

I think where AI really works well is when there's so many things to think about that the human brain isn't as good as the machine. So there's many inputs, for example, when a patient is deteriorating or the patients with sepsis, that the AI can alert the healthcare givers hours before they would be able to recognize it. And that's going to be saving a lot of lives. It already is. So we're going to see AI, I think, for images, like you just said, I think it's going to get better and better there. And for any place that there's a lot of data, that the human mind can't grasp everything.

You know, as you, as you do research there, and, uh, in a little bit I want you to tell me a little bit about your campus there because I, I have seen it and, and heard about it so much. But as you collect all of this data and you want to continue to innovate, is the innovation come from just feedback from people who are using the health records and say to be a little bit better if we collected data a little bit different way, if it were compiled in a different way, or if it were shared in a different way? Or do you actually, in terms of innovation, have research thought groups there on your campus?

We've got both. I think innovation is actually the easy part in terms of thinking up ideas because there's so many ideas. The list is way bigger than anyone's ability to do it. The innovation comes from problems. When you see a problem, then you try to figure out what can the solution be. And the innovation comes from lots of people just giving ideas. They might write to us, email, talk to us. But at the same time, we have steering committees and steering groups on many of the different specialties so that they get together and they come up with ideas as well. Our staff, especially the software developers, are required to go on what we call immersion trips. In the very beginning, they have to go to about 5 immersion trips. So maybe you go to the OR, you're a developer, you're going to develop in the OR, you go to the OR, maybe you faint, that's happened. But you have to get back up again and keep going and learn what's it like to be in an OR. And that's when they're thinking, how can I make things better? How can I watch what isn't going well enough? And that's the best way you can see it if you're an individual software developer. Get there and actually watch it. So there's so many different ways that innovation comes in.

Well, tell—

take me to, to your campus there. You and I have discussed several times some of the advantages there are of not being on the East Coast or the West Coast, or not being in Washington, D.C., when you're starting a company, growing a company, maturing a company. Um, but take us even beyond that to, to, um, your campus there, the size of it, the spirit of it, um, the way people interact. Walk us through that just a bit.

Sure. We have, I think it's 1,100 acres. We have a working farm. About one-third of the ground is cropped and we have animals on it. So I guess I do, in a sense, Bill, have animals here on campus. We've got maybe 28 office buildings because our architects told us that you can have a sense of community with somewhere around 300 to 400 people as your max. Beyond that, you lose the sense of community. So, we like to put teams together who work on the same projects. So, if you're working on OR, then you might be in one building. And we also have each building not be higher than 3 stories, pretty much. Every once in a while you see 1 story or 4, but very rare, because people will walk up and down 2 flights of stairs but not 3, and we want them to be able to meet each other. We have individual offices because our staff will tell you they get so much more work done if they have a private office and they can close the door. And I think we get an awful lot of productivity, which makes the staff much happier. I mean, they want to be productive because they have individual offices, but we also have lots of places for them to meet together. Every building has its own personality. So we just finished doing a Jules Verne building, and that has onion domes and other things to be, you know, Around the World in 80 Days. We are next going to do a, let's see, we're going to do Mystery at Castaway. So every building has its own theme.

You use the same market, is the same architect you use for each of the buildings?

Yeah, we use, we started off with two architects. One had worked with Microsoft and One had worked, does work still, with Disney around the world. Yeah. And so our DNA is a cross between a high-tech office building and a Disney building and a theme park.

And how many people do you have there on the campus?

About 10,000.

About 10,000 there.

And how many were hired from outside the state?

Roughly 10%? I'm going to guess maybe 7,000 or 7,500 of the 10,000, maybe 25% are within state.

And is it easy to attract people there? What's, what's the biggest city that's close by?

Well, Madison is, but that's not a real big city. Yeah, then Milwaukee, then Chicago.

And the people— people used to ask me, they don't ask me anymore about— is it hard to attract people, um, to move to Nashville, Tennessee to participate in the ecosystem here? When people ask you about Madison, Wisconsin, what do you say?

Well, first of all, it regularly gets listed as one of the top cities to live in, so that's a nice thing. And it is a nice place. Have you ever been to Madison?

I have been, but I had— yeah, I have been, but not to visit, not to vacation.

Oh, okay. Well, it's a nice city, and so we do get a lot of people who are looking forward to moving to Madison. We used to look up a list of cities that were the worst cities to live in since we're on the best cities to live in, and we'd go there and often get a lot of people who wanted to move. But in general, We don't have a problem with that. Sometimes we do, especially from the South where people don't want to be in a cold environment because it gets pretty cold here in the winter.

And do you think COVID will affect the way you've organized things there 5 years from now, looking back, if you have that many employees on one big campus there? Um, and now with this whole move to more distributed type learning and remote work, um, is it causing you to rethink that at all?

We think it's really special when everybody comes here and works together. There's so many ideas that are traded in hallways and in impromptu meetings. And you spoke about innovation earlier. We are an R&D shop. We do a ton of R&D. We do a ton of innovation. And I think if we have people separate, that works fine when your head's down working on something. But it doesn't work fine when you're trying to innovate. And you don't always know when those opportunities are going to be available, or you don't know when the innovation— when I shouldn't say the innovation happens— when you're going to pass someone and that idea happens. So we really believe that it's a lot better when people are here.

Judy, how do you characterize your leadership style? And I ask that because a lot of our listeners are clinicians, a lot of policymakers, a whole lot of entrepreneurs and innovators and creative, uh, people. And then there's a whole set of people who say, well, we like your podcast because of the people you have on, and they're unique in their own way. And with that as a backdrop, is there anything that over the years has developed either unique about your style of leadership or a characterization of your leadership style that you can share with us?

I think one of the most important things in terms of the company being successful is the concept of ownership, and that is whatever you're working on, own it. So if your job is something within the scheduling system to develop, you need to own that. Care for it, and that's important. Another thing I think is really important is we try to really have our staff understand how important what they're doing is. And we try to expose them to healthcare and to the tremendous trust that our customers put in us when they choose us as their system.. And so it is their own jobs on the line, it's the health of their patients, it's the success of their organization. And that's turned over to our staff who have to live up to it. And I think that helping the staff understand how critically important why we do what we do is, is huge. We almost never talk about money. That's not the focus at all. The focus is that we've made commitments to our customers to do a good job for them. And that commitment is on all their shoulders. And I think they like the sense of ownership of that commitment.

And when you, when we talk about this commitment and this sort of focus on others and part of a bigger mission, one of the advantages that we all have if you're in healthcare is that we all participate in making the world a better place, starting with making individuals and their families' lives better, which clearly you do. To sort of paint that picture, most people think of Epic as electronic health record. Epic Systems equals electronic health record, and much of our discussion has been just about that. And then you've also explained and opened my eyes to what's come out of COVID for you as well. In addition to the research institute and Cosmos and the things we talked about, is Epic Systems in any other areas? Oh yeah, built out. Just, uh, describe some of those to me.

Sure, it's a very timely question that you ask because recently, I'd say in the last couple months, I have been told twice that when we're asked what Epic does, we should never answer electronic health record because that's just one component of what we do and we do a whole lot more. So I was thinking of Google creating the holding company alphabet over it and playing around with should we be creating a holding company over Epic. And we thought if we should, it would be named Treehouse because we have a treehouse on campus. We thought everybody should have a corporate treehouse. And then the roots of the trees are all these different things that we're doing. And then it goes out into the branches as well. So some of the things that we are doing besides just what you know are that we're working with public health to keep track of surveillance so that we can alert them to what's going on in different places. And that's coming from COSMOS once again, our ability then to keep track of what's happening all over the country. Benchmarking so that our customers can compare themselves to other health systems that are matches similar to them to see how are they doing compared to what others similar to them are doing. We have something that we're just putting out now. It's called epicshare.org, and that is the learnings of our customers so that they can share those learnings with others and everybody can— all boats can rise, because that's really the goal, that everyone shares and every— all boats can rise. We have a big book on what our customers have done that others can read and copy because they have the same software, so they can copy. And for CEOs in particular, we have something called the Turn Turn book, which is one sentence per page that tells, uh, what can be done that others have done that they too could do. Then the CEOs like the one sentence, which I Absolutely agree with them on that. We're doing consulting, and we call that Boost, and that's helping our customers with whatever they need help on. Another big area we're working on is payers and even insurers that are life insurance and the payers. We are working with prior auths, with care gaps, with risk adjustment, with claims to help the insurers do a better job. So that's a little bit of what else we're doing. We're going to be putting together a podcast just like you're doing, but of how to use the software. I love it. So we will not compete with you at all.

Yeah, no, I love it.

I love it.

I want to be on your podcast someday.

Okay.

Is, um, as you were going through your list, again, as people listen to them, and you're a conventional company in many ways, um, in that you clearly had a vision and identified a huge need that, that was out there and built it. And then when I come to sort of the commitment to stay private, sort of unconventional by today's standards, which I love, and it gives you the freedom to, to do the sorts of things that you could not otherwise do. Um, the marketing is just unconventional. It's just unusual. And then, um, I've always heard that budgets, you haven't driven home budgets every year or every day, and you don't stress it overly with your teams of people.

Why not?

And what does a budget mean to you, and why do you avoid budgeting?

Yeah, we don't have budgets here. That sometimes really surprises CFOs in other companies. The reason we don't comes from real early on in Epic when I would get a call from someone who wanted to buy our software, and they would say, I need it today, but our budget isn't until July, so we have to wait. Or the other way around, I have $2 million left over in my budget, what can I buy? And when they would say that, I would say back to them, why don't you give it back? And then the answer always was, I can't give it back because next year I'll get less and I might need it next year. So after listening to the problems that are— the people we worked with as customers would say they had with budgets, we thought, why do that? Why not just say, if you need it, buy it. If you don't need it, don't buy it. And so that's the way we work. And people take that very seriously. Now, You can't just tell everybody in the whole company, go out and buy whatever you want or feel you need. Different people are authorized at different levels, and you have to learn and grow into that level. And that works well. Uh, it, I think it's the right way to run the company.

I think it's the right way. Clearly been successful there. I think there'd be a lot of head scratching among boards and boardrooms, uh, among people today if if you come in and say you don't live by budgets, since that's what we all start with. But I think it's fantastic for people to hear what you've been able to do by inspiring people to do the right thing and to do it responsibly and to do it quickly and affordably and with high quality. And if you can do that without having a budget, you know, I congratulate you. Let me close with one other more personal thing, thinking about leadership, leadership style and what, what makes success, um, an individual thing. But has there been a, a pivotal moment in your life, either, either before the 1979 or, or when you started all of this, or, or after that, that has really changed your career path, altered your career path, um, significantly influenced the way you think about either the company or yourself or the world?

Oh, I'm going to answer with two pivotal moments. The first was, of course, going to University of Rochester, learning programming there by surprise, and then again having, uh, graduate school switch me from math, which I applied in, to computer science. So that was one pivotal moment. I think the other thing was that I went to a Quaker school, and that was a very— a place that really helped define who people are. I think there's an honor system that you live by when you go to a Quaker school. There's a basic caring for people that permeates the school. And so I think it was a very good education that I had.

In the future, we've said that Epic is, is not an electronic health record company any longer. It's something much, much broader than that. That vision for the future, anything over the next 5 to 10 years in terms of goals or vision that, that you have for Epic Health or Epic Systems?

Well, I think COSMOS is, is a big deal, and I think that getting best care for my patient working and in use, it's going to be a lot of work to do. It is a lot of work to do, but I think that's going to be changing how healthcare works because now you're going to have evidence-based medicine based on observational data at your fingertips. One thing we're doing with COSMOS, which I think is really interesting, is because it's not peer-reviewed, and we do the studies with data scientists, with software developers, with physicians, with epidemiologists, we have two teams who work on the same challenge separately. And then we compare results. I think that's fascinating. Team A got this. Team B looked at it differently, got that.

So I love doing that.

That's wonderful to hear, and I was not aware of that.

Is COSMOS something that, that our listeners follow from afar, participate in, can access, uh, or is it something that, that we can touch in any way over the next 4 to 5 years?

COSMOS is what holds— is the database that holds the, um, hopefully 200 million or more patients' records that is available for study, but the only people who can access it are those who share their data and EPIC. Now, if you want to do something, you'll be able to request, and then either the health systems who share the data or EPIC will be able then to respond to your request. But for patient privacy, even though it's a limited data set, we're still restricting it for those who deal with the data every day.

Well, that really, it sort of brings together data, big data analytics, um, uh, in a way that's hugely powerful, and artificial intelligence, which we talked about, which is hugely powerful. Well, listen, Judy, thank you so much for, for being with, with me, with our listeners, with our viewers. Clearly, uh, one that inspires so many, an innovator and operator and implementer and and someone who has truly changed the course of history and health and healthcare and healing. Thank you for being with us today.

Thank you, Bill. It was very nice to speak with you again.

This episode of A Second Opinion was produced by Todd Schlosser and the Modus Creative Group. You can subscribe to A Second Opinion on Apple Podcasts, Spotify, or wherever you are listening right now. You can also watch our interviews on YouTube or on our website, and be sure to rate and review A Second Opinion so we can continue to bring you great content. You can get more information about the show, its guests, and sponsors at asecondopinionpodcast.com. A Second Opinion broadcast from Nashville, Tennessee, the nation's Silicon Valley of health services. Where we engage at the intersection of policy, medicine, and innovation.