Qld Health buries TrakHealth suit

By: Renai LeMay

in brief Queensland Health has settled its long-running lawsuit with e-health vendor TrakHealth and its parent InterSystems.
TrakHealth dragged Queensland Health into the state's Supreme Court in December 2005 after the department terminated a contract with the vendor for the implementation of the department's Clinical Information System project and related software. The e-health vendor claimed it was owed damages.
However, Queensland filed a counter-claim against the e-health vendor as well as InterSystems and its CEO Terry Ragon.
"The parties have now agreed [to] a settlement which resolves all matters in issue between them, including all claims and counter-claims in the proceedings, to their mutual satisfaction," a statement issued by TrakHealth this morning said without providing further details.

Vic rethinks e-health

By: Karen Dearne

VICTORIA is ruling a line under its patchy HealthSmart IT rollout, and has returned to the drawing board with plans for a new whole-of-health ICT strategy for the period 2009-2013.

When the now-$427 million program began in 2003, it was hoped that the ICT refresh and rebuild across the state's public hospitals, rural alliances and community health providers would be complete within four years.

But in April this year, Victoria's auditor-general Des Pearson said HealthSmart had been overly ambitious in its targets, and was at least two years behind schedule.

More than half of the original budget had been spent with only 24 per cent of the planned installations complete.

The audit office found that HealthSmart had failed to get the cornerstone Cerner clinical system working at any of its sites, and had replaced only one of 10 HOMER hospital systems which were obsolete when the program began.

Mr Pearson said the project judged most at risk, but with the greatest potential benefit, was Cerner's Millennium suite of e-health records, appointments scheduling, diagnostic services, results reporting and e-prescribing applications.

A $79 million deal with Cerner was signed in March 2006, but costs had risen by $17 million to $96 million in 2006 - the biggest price blowout so far, the audit office found.

"According to the original timelines, the acute hospitals in 10 health agencies should be using the clinical sysytems by now, but even if funding negotiations are concluded shortly, the first four agencies are unlikely to meet the June 2009 completion date," Mr Pearson said.

The department and the Office of Health Information Systems _ which has led the project _ have weathered repeated criticisms over technical and vendor aspects, including contract probity concerns raised in the state parliament.

It's also understood many of the state's health boards have raised concerns over the selection of systems and the likely cost to agencies of adopting the strategy.

Human Services secretary Fran Thorn defended the program at the recent Health-e-Nation conference in Melbourne(September 3), saying the first implementation of the Cerner suite would "formally commence" in October.

"Engagement with the next round of health services is underway in anticipation of rolling out to agencies over the next two years," she said.

HealthSmart was also rocked by early concerns over vendor iSoft's financial status and ability to deliver its next-generation software architecture, Lorenzo, as promised.

IBA Health Group bought out iSoft, and has taken over its contracts to supply the existing integrated patient and client management system, iPatient Manager.

To date, four agencies have implemented iPM, Ms Thorn said, and nine standalone health services are now using the client management system, TrakCare.

"Eight health services and 22 community health services will have these systems by this time next year," she said. "The integrated products support the management of patients across acute and community services, rather that just sharing data."

Last month, the Victorian Government allocated a further $104 million for HealthSmart in its 2008-09 budget.

Ms Thorn said HealthSmart would give the state ``one of the most up-to-date and capable health ICT infrastructures in Australia, ready for the future and able to adapt'' to a changing environment.

``Indeed, HealthConnect Victoria is leveraging off the investment in infrastructure and applications,'' she said.

``In partnership with our federal colleagues, a Shared Electronic Health Record project has been established to prototype a limited SEHR system across a number of public hospitals, primary and community care providers in the Bendigo Loddon/Mallee region.''

This project has received more than $1.5 million in federal funding, from October 2007 until June 2009.

HealthSmart two years behind schedule

By: Karen Dearne

VICTORIA's troubled $320 million HealthSmart project has failed to get the cornerstone Cerner clinical system working at any of its sites, and has replaced only one of 10 Homer hospital systems, which were obsolete when the program began four years ago.

Auditor General Des Pearson said HealthSmart was at least two years behind schedule and more than half of the budget had been spent with only 24 per cent of the planned installations complete.

In a long-awaited review, Mr Pearson said the original budget, which involved health agency co-funding, was not realistic, and the targets were too ambitious.

Victoria's Human Services Department and the Office of Health Information Systems have consistently deflected concerns raised in the state parliament by vendors, industry observers and even an anonymous group of healthcare workers.

The project judged most at risk, but with the greatest potential benefit, is Cerner's Millennium clinical suite, which includes health records, electronic scheduling, diagnostic services, results reporting, and e-prescribing capabilities.

"The first release of the clinical system has been tested by various user groups and is ready for use, but none of the four lead agencies have committed to using the new system," the report says. "According to the original timelines, the acute hospitals in 10 health agencies should be using clinical systems by now, but even if funding negotiations are concluded shortly, the first four agencies are unlikely to meet the June 2009 completion date."

The $79 million deal with Cerner was signed in March 2006, but costs rose by $17 million to $96 million in 2006 -- the biggest price blowout in the program.

A Cerner spokesman yesterday declined to comment, citing contractual obligations.

Reation suite.

ISoft ran into difficulties supplying systems to the British National Health Service Connecting for Health program, and was subsequently acquired by another Australian firm, IBA Health Group.

Communications director Greg King said IBA Health was "comfortable tracking to the time frames set by HealthSmart" for completion in 2009.

"The procurement process took longer than expected and the project started nine months later than anticipated, so the department, lead agencies and we as vendor are doing quite well catching up," he said.

"We've got nine lead agencies in our portfolio. We already have three live, we have one in implementation and two others are in the planning stage, so we've only got three sites pending."

Mr King said it was "always good to have a third pair of eyes looking at large projects" such as HealthSmart.

"We don't see anything in his report that we have any major disagreement with," he said.

Oracle achieved the best result among technology suppliers, with its E-Business financial management system implemented in eight of 11 participating agencies. The remaining three were due for completion this month.

Mr Pearson found the Oracle project came in $500,000 over the original budget, at $26.8 million.

TrakHealth has set up its standalone Client Management System in two community health centres, and a further 10 sites wish to install the product.

Mr Pearson found there was "room for improvement" in the shared services arena, where underperformance had a knock-on effect on systems availability.

Meanwhile, a lack of interest by agencies in taking up the payroll system might "trigger" payment of a revenue guarantee to the vendor.

Victorian shadow minister for health Helen Shardey said the auditor's findings were not unexpected, but the extent of the project's failure was a surprise.

"We have supported this kind of technology to bring our health system into the 21st century, so the massive failure is a tragedy," she said. "The project has been completely botched, and it points to a government that is just not capable of delivering on these important projects."

Melbourne leads AU$10m Victorian e-health rollout

By: Suzanne Tindal

Two community health agencies servicing the western suburbs of Melbourne and Bendigo have implemented Intersystem's Web-based TrakCare healthcare information system, the first deployments in a AU$10 million rollout across a number of Victorian health agencies.

In a first for Victorian community health, TrakCare will allow patient information to be captured within a single electronic medical record, allowing patients to only register once for most services including general practice, mental health, physiotherapy and occupational therapy.

Previously, the health centre had a "large number of systems," according to Clare Amies, CEO of Western Region Health Centre -- which has 13 different sites around inner and outer Melbourne -- making it necessary to repeatedly enter patient information into the various systems and databases for each site.

In addition to the reduction of duplicate entry of data, the system also allows the centre to better coordinate patient's appointments, according to Amies.

This has lead to significant cost savings, for example, by having appointment information in a single location. This has allowed the health centre to book interpreters over many appointments, instead of booking them individually for each one -- which often occurred while using the previous manual system. The change allows the health centre to avoid paying the minimum tariff of one and a half hours work for only one sitting.

The TrakCare system also allows the healthcare centres to create reports about referrals within and outside the organisation. The reports can aid in identifying when a patient can't be referred to a specialist service within the centre, such as when waiting lists are too long, for example, and where else they can be referred to externally.

TrakCare also helps identify in the meantime what other services are available that could be of use to patients on waiting lists, Amies said. For example, a diabetic wanting to see a booked-out dietician could have access to a diet educator, who might be giving a seminar in a clinic or who could point the patient to other relevant resources.

The allocation of resources will now receive a leg up from TrakCare's information, according to Amies. "We now have tangible data to take to the Department of Human Services -- we've been live for a year and we're just starting to collect some really good information," she said, allowing the health centre to "respond to the needs of the community and plan better".

The system has been built to adhere to privacy legislation, a spokesperson for the Department of Human Services said, adding: "There are processes in place to make sure privacy is upheld."

Patients are able elect whether or not to make their data available across the different sites and services, Amies said. "Sometimes people don't consent to everybody and sundry reading their notes," she said, but added: "Not many elect out. Most people are happy that it's secure in that people can't access it unless they're authorised."

Ten other health agencies are currently implementing TrakCare and intend to go live between now and the end of 2008. Another 12 agencies have entered into an expression of interest stage which should see them implement TrakCare by the end of 2009.

Implementing TrakCare is part of the Victorian government's AU$360 million HealthSMART program.

State seeking e-health damages

By: Sean Parnell

THE Queensland Government has raised the stakes in its legal row with developer TrakHealth and is seeking almost $100 million in compensation for a failed e-health contract.

When Queensland Health scrapped a $30 million hospital software contract with TrakHealth three years ago, the company took Supreme Court action to recoup $18 million in losses and unspecified damages.

TrakHealth, which was to supply a patient administration system and a clinical information system, accused the government of compromising the project and damaging its reputation.

"Queensland Health's behaviour was unreasonable and unconscionable," a TrakHealth spokesman argued at the time, as the company sought work elsewhere.

In its defence, Queensland Health involved US-based InterSystems, which now owns TrakHealth, and database pioneer Terry Ragon, filing reams of documents in the Brisbane Supreme Court to demand $21.5 million in compensation.

Queensland Health argued that TrakHealth misrepresented itself and its product, MedTrak, ahead of an order being placed in 2003, while Mr Ragon, the founder of US-based InterSystems, failed to intervene to limit Queensland Health's losses.

Earlier this month, Queensland Health amended its defence and counterclaim to seek $98.2 million in compensation to cover the increased cost of delivering such software in the current market.

Queensland Health estimates it would cost $132 million to have a similar system installed now, not to mention the cost of keeping other systems going in the meantime, well beyond the $33.81 million involved in the original deal.

"To put Queensland Health in the position in which it would have been had the plaintiff performed its obligations under the contract, it would be necessary to procure from a different software supplier a product equivalent to that which the plaintiff contracted to deliver," court documents state.

A spokesman for TrakHealth, InterSystems and Mr Ragon declined to comment.

It is understood they have until today to file documents in the Supreme Court to respond to Queensland Health's amended defence and counterclaim.

A Queensland Health spokesman said e-health remained pivotal to the future of sustainable healthcare and the department had committed to a massive information and communications technology strategy.

"This strategy aims to create a consolidated holistic view of patient care by enabling ICT investment over the next four to seven years," the spokesman said.

"It will ensure Queensland is moving towards supporting the electronic collection, transmission, safe storage and access of patient and clinical information that supports the improvement of patient care."

Queensland Health's priorities in the strategy are discharge summaries, results reporting, order entries, electronic clinical notes, statewide scheduling and comprehensive medication management.

The department, which plans to introduce new technology systems and capability "where necessary", has engaged alliance partners EDS (for enterprise architecture) and PricewaterhouseCoopers (for change and program management) to assist with this stage of the strategy.

In the Australian market, TrakHealth is most active in Victoria, but it also has contracts in Asia, New Zealand and Britain.

Govt woes don't trouble TrakHealth

By: Ben Woodhead

MEDICAL software heavyweight InterSystems is eying big ticket hospital software projects in South Australia and Western Australia as it moves to capitalise on its acquisition last year of local firm TrakHealth.

But the company has acknowledged that the spectre of TrakHealth's legal battle with the Queensland Department of Health in relation to a failed patient and clinical systems initiative still looms over its meetings with other public sector organisations.

"Obviously everyone asks questions about it but moving on what's important is that we have a good product," TrakHealth chief operating officer Christine Chapman said.

Ms Chapman declined to confirm if the company was holding settlement discussions with Queensland Health over the hospital software project, which collapsed acrimoniously in late 2006.

TrakHealth subsequently said it would pursue $18.2 million in damages from Queensland Health but the health agency promptly fired back with a $21.9 million counterclaim against TrakHealth.

The matter is expected to go to trial in the Queensland Supreme Court this year if the two parties are unable to reach a settlement.

Ms Chapman said that InterSystems is now hiring software developers locally as it works to build up TrakHealth's development team following the acquisition in May last year.

The company has added six new developers over the past 12 months and has hired a full time recruiter to look for additional staff.

The hiring comes as InterSystems works to sell TrakHealth's TrakCare product into its international customer base, which includes a number of organisations with large healthcare operations such as the US Department of Veterans Affairs.

The company is also looking at public sector opportunities in Australia including Western Australia's $335 million eHealthWA project and a South Australia Department of Health patient software initiative worth tens of millions of dollars.

Ms Chapman said that InterSystems, a long time partner of TrakHealth, had acquired the company because of the strengths of its intellectual property.

She poured cold water on suggestions that the purchase was prompted by TrakHealth's weak financial position, which included losses worth more than $40 million over the last four years.

She also said that past financial performances did not reflect on the future sales prospects for the TrakCare product.

"Healthcare is a bigger company business," Mr Chapman said."(TrakHealth) was a small company and it was not able to bid on a lot of the bigger contracts."