Nuance and 3M Team to Deliver Next Generation ICD-10-Ready Clinical Documentation Solutions

Leaders in Healthcare IT Break Barriers in Clinical Documentation Improvement and Coding; CLU-Powered, ICD-10-Ready Solutions to Set Industry Standard for Accuracy and Efficiency

Burlington, MA., February 16, 2011 — Nuance Communications, Inc. (NASDAQ: NUAN) and 3M Health Information Systems, two leaders in healthcare IT, today announced a broad, strategic partnership in which the companies are working together to deliver a suite of next generation, ICD-10-ready clinical documentation and coding solutions.  As part of the collaboration, the companies will introduce Computer-Assisted Physician Documentation™ (CAPD), technology that will provide breakthrough advancements in clinical document improvement (CDI).  Powered by Nuance’s advanced speech recognition and Clinical Language Understanding (CLU) technologies, and integrating 3M’s extensive CDI content and expertise, the use of CAPD will become a core component to provider organizations’ clinical documentation workflow.

CAPD is designed to accelerate healthcare organizations’ transition to ICD-10, a new medical coding standard that will be mandated by the U.S. Department of Health and Human Services in October 2013.  By combining Nuance’s speech recognition and CLU capabilities with 3M’s experience in developing and implementing ICD-10 coding products and services around the world, the companies will deliver solutions to empower healthcare organizations to create and use high-quality clinical documentation to optimize the accuracy and efficiency of their coding.

“High-quality clinical documentation is a driving force behind clinical, business and compliance decisions.  By transforming healthcare organizations’ clinical data into actionable information, we are delivering a new level of medical intelligence that, in the case of Computer-Assisted Physician Documentation, will not only bring substantial improvements to physician workflow; it also will facilitate more precise and complete coding and more accurate claims,” said Janet Dillione, executive vice president and general manager, Nuance Healthcare.  “The combined capabilities of Nuance and 3M will uniquely enable clinical documentation improvement at the point-of-dictation.  Our shared focus is on helping healthcare organizations create ICD-10-ready clinical documentation that will streamline coding, reimbursement and drive financial performance.”

CAPD will support physicians throughout the entire clinical documentation process, providing instant access to information needed to support documentation decisions.  As part of the CAPD workflow, clinicians will be able to use speech-recognized dictation to document patient encounters in their own words, preserving the unique patient story, while also incorporating relevant structured data.  When necessary, automated prompts will signal physicians for additional information to help improve documentation and to generate sufficient detail for both ICD-9 and ICD-10 coding.  Nuance and 3M customers who utilize Dragon® Medical, eScription® or Dictaphone® Enterprise Speech System will have the option to purchase the new CAPD solution.

“Healthcare reform, changes in reimbursement and quality reporting, and the complex transition to ICD-10 are presenting huge challenges to physicians in how they document the patient episode,” said Jon T. Lindekugel, President, 3M Health Information Systems.  “CAPD from 3M and Nuance is a breakthrough technology that will help physicians capture complete and accurate clinical documentation while saving time and reducing costs. Achieving documentation best practices can have a profound impact on a hospital’s efficiency, quality of care, reputation, and profitability.”

By intelligently determining that all required information is present, specific and clear, including accurate reflection of severity and risk of mortality, CAPD will align clinical documentation from the electronic health record (EHR) with what is coded.  This streamlined process is designed to reduce audit risks and significantly decrease CDI staff inquiries to physicians for more information, enabling more time for patient care.

“Computer-Assisted Physician Documentation is a game-changing advancement to what today the healthcare industry calls Clinical Documentation Improvement or CDI.  The ability to prompt physicians for clinical specificity at the time of documentation is really groundbreaking.  It will streamline workflow for physicians and will eliminate time-consuming and distractive queries after the fact,” said Joan Scully, former Senior Director, Revenue Cycle Management at the Cleveland Clinic and President/CEO of Scully Healthcare Consulting.  “The work that Nuance and 3M have underway is going to significantly simplify the process of creating high-quality clinical documentation.  In turn, these companies will help healthcare organizations ensure appropriate reimbursement, reduce compliance risk and meet the challenges of the upcoming ICD–10 transition.”

As part of the strategic relationship, 3M will also license Nuance’s CLU technology to advance its computer-assisted coding products for inpatient and physician-based coding.  The enhanced technology will streamline coding workflow, improve coder productivity under ICD-10, and support integration of 3M’s market-leading coding technology with its suite of mobile physician software applications.

The Nuance and 3M CAPD offering will be demonstrated at the Healthcare Information and Management Systems Society (HIMSS) annual conference and exhibition in Nuance and 3M’s booths (#2744 and #3547), being held in Orlando, Fla., February 20-24.  The companies expect the CAPD solution to be released in the fall of 2011.

3M Health Information Systems

3M Health Information Systems delivers comprehensive software and consulting services to help organizations worldwide improve clinical documentation, quality, and financial performance across the healthcare continuum. 3M offers integrated solutions for medical records coding, ICD-10, dictation and transcription, speech recognition, clinical documentation improvement, quality, and data standardization and vocabularies, effectively meeting the industry’s changing needs. With more than 25 years of healthcare experience and expertise, 3M works as a trusted and stable business partner to provide reliable implementation, training, and support services. www.3Mhis.com

Nuance Healthcare

In the era of Accountable Healthcare, where there is shared responsibility for the quality and cost of patient care, Nuance Healthcare’s portfolio of Medical Intelligence solutions empower healthcare provider organizations, payers and individual physicians worldwide to deliver higher quality care, improve financial performance and enhance compliance efforts.  Nuance Healthcare employs a range of technologies and services as part of its full portfolio – speech recognition, clinical language understanding, decision support, test results management and data analysis.

For additional information on Nuance’s healthcare IT solutions visit: http://www.nuance.com/for-healthcare/index.htm

Clinical Language Understanding (CLU), Driven by Nuance

Nuance’s advancements in CLU empower physicians to document patient encounters and medical decision-making details in their own words via Nuance speech-recognized dictation, while simultaneously extracting key clinical data, including: patient complaints, physician-assessed diagnoses, medication and procedural treatments, and health-related habits.  With CLU healthcare organizations can better use the information captured within disparate medical records to make smarter clinical, business and compliance decisions.

Nuance Communications

Nuance Communications, Inc. is a leading provider of speech and imaging solutions for businesses and consumers around the world. Its technologies, applications and services make the user experience more compelling by transforming the way people interact with information and how they create, share and use documents. Every day, millions of users and thousands of businesses experience Nuance’s proven applications. For more information, please visit www.nuance.com .

Trademark reference: Nuance, the Nuance logo, Dragon and Dragon Medical are registered trademarks or trademarks of Nuance Communications, Inc. or its affiliates in the United States and/or other countries. All other company names or product names referenced herein may be the property of their respective owners.

Statements in this document regarding Nuance managements’ future expectations, beliefs, goals, plans or prospects constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements that are not statements of historical fact (including statements containing the words “believes,” “plans,” “anticipates,” “expects,” or “estimates” or similar expressions) should also be considered to be forward-looking statements. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including: fluctuations in demand for Nuance’s existing and future products; economic conditions in the United States and abroad; the effects of competition, including pricing pressure; possible defects in Nuance’s products and technologies; the ability of Nuance to successfully integrate operations and employees of acquired businesses; the ability to realize anticipated synergies from acquired businesses; and the other factors described in Nuance’s annual report on Form 10-K for the fiscal year ended September 30, 2010 and Nuance’s quarterly reports on Form 10-Q filed with the Securities and Exchange Commission. Nuance disclaims any obligation to update any forward-looking statements as a result of developments occurring after the date of this document.