Tag Archives: BT Health

How London IT director saves millions by buying patient record system.

By Tony Collins

An NHS organisation in London has bought an electronic patient record system for less than a third of the cost of similar technology that is being supplied by BT to other trusts in the capital and the south of England.

The £7.1m purchase by Whittington Health – a trust that incorporates Whittington Hospital near Archway tube station – raises further questions about why the Department of Health is paying BT between £31m and £36m for each installation of the Cerner Millennium electronic patient record [EPR] system under the NPfIT.

Whittington Health is buying the Medway EPR system from System C which is owned by McKesson. The plan is for the EPR to operate across GP, hospital and social care boundaries.

It will include a patient portal. The idea is that patients will use the portal to log on to their Whittington Health accounts, see and save test results and letters, and manage outpatient appointments on-line.

In a board paper, Whittington Health’s IT Director Glenn Winteringham puts the case for spending £7.1m on a single integrated EPR.  Winteringham puts the average cost of  System C’s Medway at £8m. This cost, he says, represents “significant value for money” against the average deployment costs for the NHS Connecting for Health solution (Cerner Millennium) for London of £31m. In the south of England the average cost of Cerner Millennium is £36m, says Winteringham in his paper.

He also points out that the new EPR will avoid costs for using “Rio” community systems. The NPfIT contract with BT for Rio runs out mid 2015. “From this date onwards the Trust will incur an annual maintenance and support cost. Implementing the EPR will enable cost avoidance to the [organisation] of £4m per year to use RIO (indicative quotes from BT are £2m instance of RIO and the [organisation] has 2 – Islington and Haringey).

BT’s quote to Whittington for Rio is several times higher than the cost of Rio when supplied directly by its supplier CSE Healthcare Systems. A CSE competitor Maracis has said that, during a debrief, it was told that its prices were similar to those offered by CSE Healthcare for a Rio deployment – then less than £600,000 for installation and five years of support.

In comparison BT’s quote to Whittington for Rio, as supplied under the NPfIT, puts the cost of the system at more than fifteen times the cost of buying Rio directly.

In short Whittington and Winteringham will save taxpayers many millions by buying Medway rather than acquiring Cerner and Rio from BT.

Why such a price difference?

The difference between the £31m and £36m paid to BT for Cerner Millennium and the £8m on average paid to System C could be partly explained by the fact that Whittington (and University Hospitals Bristol) bought directly from the supplier, not through an NPfIT local service provider contract between the Department of Health and BT. Under the NPfIT contract BT is, in essence, an intermediary.

But why should an EPR system cost several times more under the NHS IT scheme than bought outside it?

Comment:

Did officials who agreed to payments to BT for Cerner and Rio mistakenly add some digits?

Whittington’s purchase of System C’s Medway again raises the question – which has gone unanswered despite the best efforts of dogged MP Richard Bacon – of why the Department of Health has intervened in the NHS to pay prices for Rio and Cerner that caricature profligacy.

Perhaps the DH should give BT £8m for each installation of Cerner Millennium and donate the remaining £21m to a charity of BT’s choice. The voluntary sector would gain hundreds of millions of pounds and the DH could at last be praised for spending its IT money wisely.

Whittington buys Medway and scraps Rio – E-Health Insider

NHS IT supplier “corrects” Health CIO’s statements

MP seeks inquiry into BT’s £546m NHS deal

NPfIT go-live at Bristol – trust issues apology

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Who’ll support the NPfIT now?

By Tony Collins

The departure of Christine Connelly as health CIO at the end of this month will leave the NPfIT’s main civil service supporter, Sir David Nicholson, Chief Executive of the NHS and Senior Responsible Owner of the NHS IT scheme,  more isolated.

That Nicholson is a supporter of the continuance of the NPfIT is not in doubt. He spoke about the NHS IT scheme last month in terms of life and death. At a hearing of the public accounts committee on 23 May 2011, Nicholson said:

We spent about 20% of that resource [the £11.4bn projected total spend on the NPfIT] on the acute sector. The other 80% is providing services that literally mean life and death to patients today, and have done for the last period.

“So the Spine, and all those things, provides really, really important services for our patients. If you are going to talk about the totality of the [NPfIT] system … you have to accept that 80% of that programme has been delivered.”

But without Christine Connelly, who put detailed arguments in favour of continuing with iSoft’s Lorenzo, and who was solidly behind the costly implementations of Cerner by BT, Nicholson may not have the civil service backup he needs to promote the continuance of the NPfIT.

The Cabinet Office’s Major Projects Authority, under the directorship of the independently-minded David Pitchford,  is now reviewing CSC’s £2.9bn worth of NPfIT contracts. It is known that the Authority regards the new proposals worked out between CSC and the Department of Health as poor value for money, even with CSC’s willingness to reduce the value of its contracts by £764m, to about £2.1bn.

That promised reduction comes at a cost. A leaked Cabinet office memo said that the CSC’s proposals would double the cost of each Lorenzo deployment.

The easiest thing for Nicholson and the Department of Health would be for the Major Projects Authority to approve the deal worked out between CSC and the Department of Health, and simply sign a new Memorandum of Understanding which would be, in part, legally binding.

Strong grounds for ending CSC’s NPfIT contracts

The more difficult but more practical alternative is for the Cabinet Office to require the Department of Health to end CSC’s NPfIT contracts, which would leave the NHS more able to decide its own IT-based future.

Indeed the signs are in some trusts that officials are not unhappy about Connelly’s departure in that they perceive it may weaken the centre’s control over NHS IT.

Legally it appears that an end to CSC’s contract would be feasible. The Department of Health has accused CSC of a breach of contract because of its failure to achieve a key milestone; the Department has also notified CSC of “various alleged events of default under the contract” which are “related to  delays and other alleged operational issues”. The Department is considering its position on termination of all or parts of the contract.

But the Department has not taken its claims to arbitration; its allegations are only a formal legal manoeuvre at the moment.

CSC accuses NHS of failures and breaches of contract

CSC has reacted by accusing the NHS of a breach of contract. The company’s formal legal position is that it has cured or is preparing to cure the faults that led to the alleged breach; it says that failures and breaches of contract on the part of NHS have caused delays and issues.

The DH could end CSC’s contract for reasons of convenience which could trigger a request from CSC for a large sum in compensation. But the Department could give strong legal reasons for not paying. Although CSC could pursue its claim for compensation, it may be on soft ground because of its failures. Also, CSC, if it pursues any legal action, could jeopardise its other work for government: some of its other major contracts with the UK government are with the Identity and Passport Service, which is part of the Home Office.

The Coalition is now supervising its major suppliers, including CSC, in the round, which is reason enough for CSC to do all it can to maintain a good relationship with the Cabinet Office.

CSC would support NHS trusts even if its contracts ended

The  Department of Health is concerned that if it ends the NPfIT contracts with CSC, the supplier may leave unsupported many trusts that have CSC’s iSoft software installed. That is highly unlikely, however, because CSC has a $1.03bn investment in the NPfIT contracts according to the regulatory reports to US authorities.

In the NHS CSC has a large customer base. Through its acquisition of iSoft, CSC will want to capitalise on its investment in iSoft’s Lorenzo software by selling it across the globe. That’s its stated plan. So CSC’s continued support for NHS trusts that have installed iSoft software is not in doubt.

What NHS Trusts want

The best outcome of the negotiations with CSC, for NHS trusts that have installed iSoft software, is that they have the:

-choice to continue with CSC if the price is right

– buy support elsewhere, or

– choose a different product.

Will CSC’s NPfIT contracts end by mutual agreement? – it’s possible

The question is: does the Cabinet Office have the courage to end CSC’s contract, freeing up billions of pounds that would otherwise have been spent on the NPfIT without a commensurate return for taxpayers, the NHS or patients?

It seems  so, even if it means paying a relatively painless sum to CSC as compensation for termination.

Leaked memo reveals CSC’s plans.

A sign that coalition reforms will change behaviour of major suppliers.

Health CIO resigns – Cabinet Office executive steps in.

Example of a trust that’s succeeding without the NPfIT – Trafford General Hospital.

Connelly at odds with PM over NPfIT value for money?

NHS CIO in dramatic resignation.