The last bastion

The last bastion

The IT industry is clamouring to take advantage of the huge opportunities offered by digitising Australia’s ailing healthcare industry. But will the strategy work?

Take a clinical system for example. The stakeholders include not just whatever levels of Government fund the project, but hospital administrators, clinicians, and all the allied health providers that may connect with the system.

Healthcare funding alone comes from multiple stakeholders in Federal Government, State Government and private enterprise. The Federal Government funds the medical benefits scheme for GPs, funds much of the aged care system, the community services system, and indirectly funds the public hospital system. The State Government is responsible for the operational delivery and funding of public hospitals.

Being an under-funded industry, Anderson said that working in health IT requires patience, dedication and the right motives. Activities like pro bono work, Government relationships and networking events are essential.

"People in Government are risk-averse, they make decisions only after they know you," she said. "It's important to be seen and be known. You have to get into the circle." Many ISVs have to wait several years before signing their first customer and very few grow to become successful.

"Very few of the ISVs still up and running are making money from health IT," she said. "Most supplement their revenues with solutions built for other verticals."

The same applies to other channel partners, according to Dembo.

"Anybody interested in this industry needs to prepare themselves for a longer sales cycle than usual," he said. "Health is interested in innovation - remember that this is an industry that has adopted digestible cameras and minimalist surgery. But the key characteristic is a pragmatic attitude to technology - the system has to be tried and tested before they will consider it.

"It would be easier for those channel partners that have cash cows in other industries to adapt to these sales cycles. The burn-rate a start-up would go through would be difficult to sustain."

Enter the giant

Anderson said many smaller ICT players had done well by supporting the implementations of traditional health application vendors such as iSoft (now owned by IBA Health) and Cerner. But systems integrators and ISVs are now being offered a new alternative from a familiar face. Microsoft has stated its unequivocal intention to make a play for the eHealth market. The software giant is of the opinion that one of the key barriers to health ICT innovation is the cost of licensing and implementing software solutions.

"Healthcare has been asking the IT industry to help it reduce the cost of digitising," Dembo said. "Microsoft is well placed to do that because it is expert at finding the points in any system that can be commoditised. It has a globally supported stack as well as ISV and SI communities that can reduce the overall cost and risk and time to market for solutions."

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