Clifford Illig cofoundedhealthcare companyCernerCorporation with fellow ArthurAndersenconsultantNeal Pattersonback in 1979. By the time they took the company public in 1986 they were booking just $17 million in revenue. As the industry ballooned over the years,Cerner, based out of North Kansas City, carved out a leading position as a provider ofhealthcare IT services that now manages electronic records and process more than 150 million health care transactions per day and brings in annual sales of nearly $3 billion. <\/p>\n
Cerners propitious rise it now has a market value of nearly $22 billion made a billionaire out of Patterson, the companys CEO, in 2012. Illig, who served as chief operating officer until 1998 and remains vice chairman of the board, joins him as a billionaire today following strong quarterly earnings announced last week that have pushed the companys stock to an all-time closing high of $63.31 per share. Illigs 4.3% stake (14.74 million shares) in Cerner is worth $933 million. Another nearly 900,000 vested options and proceeds from share sales over the years add more than $100 million to his net worth, pushing him over the billion-dollar threshold. Illig and Patterson are also part of the ownership group of Major League Soccer team Sporting Kansas City, which Forbes valued at $108 millionlast year. <\/p>\n
Through a Cerner spokesman, Illig declined to comment. <\/p>\n
How did this North Kansas City company become a leader inhealth care technology innovation? As Matthew Herper recounted ina May 2012cover storyforFORBES,Patterson, Illig and another ArthurAndersencolleague named Paul Gorup got the idea to start a software company while studying at a picnic table for the certified public accountants exam (for fun) in a park. Their first job was from a large medical practice, and the health care ball kept rolling from there. They raised $3 million in venture capital in 1984 and raised another $16 million from the IPO two years later. <\/p>\n
It was very small by any standard, Patterson told Herper, except for if you were the farm boy from Oklahoma, it looked like a lot of money. <\/p>\n
Since Patterson started Cerner in 1979 it has been consistently profitable, and shares have steadily increased. The appreciation of Cerners shares has made the frugal Patterson a very rich man. His net worth is now $1.65 billion. <\/p>\n
Cerners explosive growth in recent years, according to Herper, was in large part the result of the nations 2009 health care overhaul: <\/p>\n
Pattersons innovations in computing and data storage certainly helped fatten that number. ButWashington, especially PresidentBarack Obama, has given him a healthy boost. As the rest of the economy floundered, Cerner boomed, thanks to a 2009 law that was Obamas first foray into health care. The Health Information Technology for Economic & Clinical Health (HI TECH) was a $19 billion part of the 2009 stimulus bill designed to create new jobs. This bipartisan efforteven stimulus basher Newt Gingrich lobbied for itaims to entice and then punish hospitals into finally going digital. Those that meet certain milestones, such as using computer systems to order medicines, detect deadly errors and keep patient records, get payments. Any hospital that doesnt havemeaningful use of IT by 2015 will face a cut in reimbursements. Its a market-based system, because it allows hospitals to choose among rivals such as Cerner, Allscripts and General Electric General Electric, but it practically forces everyone to buy something, at a cost of up to $30 million per hospitaland thats without the extra IT staff they need to hire. This made health IT one of the hottest hiring sectors of the whole economy. Cerners workforce grew 20% to 10,500 employees in the past year, and the company is opening a new 660,000-square-foot office complex in Kansas City to hold 4,000 more employees <\/p>\n
The company is showing no signs of slowing down. It announced third quarter results last Thursday showing $840 million in revenue and $129 million in net income, a 15% and 12% year-over-year increase, respectively. The stock is up 6% since the announcement and 13.6% year to date. <\/p>\n
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Clifford Illig Becomes Second Cerner Billionaire as Health Care Company's Stock Reaches All-Time High<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" Clifford Illig cofoundedhealthcare companyCernerCorporation with fellow ArthurAndersenconsultantNeal Pattersonback in 1979. Continue reading