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Web health records firm expands to Boston

Miami’s CareCloud settles in the city

CareCloud chief Albert Santalo expects to have up to 40 people working in South Boston by the end of the year.

Pat Greenhouse/Globe Staff

CareCloud chief Albert Santalo expects to have up to 40 people working in South Boston by the end of the year.

Four years after its founding and three years after releasing an Internet-hosted software platform for sale to doctors, Miami start-up CareCloud Corp. already has become one of the fastest-growing and most disruptive players in the electronic health records business.

Now CareCloud is planting its flag in one of the nation’s health care capitals.

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The company will formally open a Boston office Tuesday in a refurbished brick factory in the Innovation ­District, joining a Massachusetts health information technology cluster that includes established rivals such as athenahealth Inc. of Watertown and eClinicalWorks of Westborough.

Albert Santalo, founder and chief executive of CareCloud, said he was lured to Boston by the area’s health care and technology expertise and already has hired about 15 people here. They include senior engineering, sales, and marketing executives, some of whom were recruited from competitors like athenahealth and GE Healthcare. By the end of the year, CareCloud should have 35 to 40 people working out of South Boston, he said.

“I love the city,” said Santalo, who will attend a ribbon-cutting ceremony Tuesday with Mayor Thomas M. Menino of Boston. “I love the talent you can find here.”

Santalo, an engineer and ­serial entrepreneur, said he was drawn to the electronic health records space because he is ­convinced the US health care system has become overly ­complex and dysfunctional.

“It’s this big broken industry, and we feel a lot of the problems can be solved by better information technology,” he said, contending a company that comes up with solutions can ­become nearly as big as ­Amazon.com. “We see ­ourselves as having a $100 ­billion opportunity.”

Rival electronic medical records companies are watching CareCloud, which is backed by Intel Capital and Norwest Venture Partners and has signed up about 2,500 physicians — including 170 employed by Miami Children’s Hospital — in its first three years. Santolo said he expects to have 5,000 doctors enrolled by the end of 2013, and 10,000 a year later.

Jonathan Bush, chief executive of athenahealth, an Internet health records pioneer which last year agreed to buy the Arsenal on the Charles ­office campus that houses ­athenahealth’s headquarters, declined to talk about CareCloud, a spokeswoman said. But in a 2011 Twitter post, shortly after being introduced to Santolo, Bush tweeted, “I just met the man who will kill me. It won’t be for 10 years yet . . . but check-out carecloud.com. such a beautiful app!”

While many large hospital systems and multispecialty practices still opt for proprietary electronic medical systems that they can control in-house, Internet-based “cloud” systems are the fastest-growing segment of the market, analysts said. They are especially attractive to young physicians accustomed to doing work through websites and smartphones.

“I think they’re the future,” said Judy Hanover, research director for IDC Health ­Insights, a technology research firm in Framingham. “The cloud app is really resonating with health care providers. CareCloud is off to a good start. They’ve really gained a lot of traction, a lot of buzz.”

CareCloud is still too small to register on IDC’s ranking of the top sellers of electronic health records software, which includes eClinicalWorks, Epic Systems, GE Healthcare, athenahealth, and Greenway Medical. But at the rate it’s growing, that could change in coming years.

“They’re definitely an up-and-comer,” said Richard Close, research analyst at Nashville ­investment bank Avondale Partners, who said many ­doctors’ practices using federal stimulus funds to replace aging technology systems are ­choosing Internet platforms. “This is fresh technology ­compared to a lot of the older health IT software out there.”

Close said the number of doctors using the CareCloud platform has grown more than fourfold from a year ago. “That’s definitely fast growth, coming from nothing,” he said. “A lot of physicians didn’t adopt electronic health records in the past because the technology was old and cumbersome. But this is newer technology that can improve the work flow.”

Unlike older systems that are hosted locally, CareCloud can continuously update its software to accommodate changing health care delivery practices, payment models, and new technology. The company issues monthly updates, including lists of new features.

Santalo said CareCloud is working to differentiate itself from competitors in several ways. Doctors can use it through any browser or electronic platform. They can choose to buy only the software or a “concierge” service where they can outsource tasks such as billing to CareCloud. And they can share with patients an “elegant user interface” that is more akin to smartphones and consumer electronics than the clunky enterprise applications deployed in many workplaces.

“If doctors and their staffs are going to spend a third of their lives on our system, let’s make them feel smart, not stupid,” Santalo said. “Let’s let them have fun.”

Robert Weisman can be reached at weisman@globe.com. Follow him on Twitter @GlobeRobW.
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