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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?

Australia's health industry is in crisis. Our population is ageing, demanding more of our health system. Meanwhile, our supply of skilled medical professionals is being stretched to capacity - with doctors and nurses working overtime to meet the demand. It's the kind of problems that IT systems - and the business process improvements that comes with them - are usually able to resolve.

But healthcare is an industry that has under-invested in IT. It is, according to the CIO of one hospital, "the last bastion" of Australian industry that has all but skipped out on the automating and digitising forces of the IT economy.

Faced with limited budgets and a huge list of spending priorities, its IT systems have historically been neglected.

"It's still a paper-based, manual industry that is yet to automate, and at the same time, it's an industry with significant staff shortages," Dr David Dembo, a former clinician who now runs Microsoft's healthcare team in Australia, said. "The supply of nursing and other clinical staff is dire."

"IT in healthcare is very antiquated, even more than people realise," director of technology research company S2 Intelligence, Bruce McCabe, said. "It suffers, more so than any other sector, from an underinvestment in IT."

This underinvestment impacts the industry on several fronts. It is felt on the frontline by clinicians - many spend between 50 and 60 per cent of their time doing paperwork, rather than in front of patients. This represents, at Government funding level, a waste of very valuable resources.

IBA is Australia's largest producer of e-Health solutions. Group communications director, Greg King, said there's an enormous amount of waste in the system. Activities are often duplicated - patients are asked to answer the same questions on multiple forms. Or they are asked to do three blood tests in a matter of days, as information on a previous blood test isn't readily available to the next clinician in line. Worse still, it leaves clinicians with inadequate information about patients. Patients often neglect to tell clinicians about allergies, medications they are already taking, and other key information that would help the clinician make the best choices.

"Many healthcare decisions are not being made with the full picture available to the practitioner at the point of care," Dembo said. "Decisions are being made on the best information available, which when it comes to health, is not good enough. The error rates in our health system - at around 4.6 per cent - are unacceptably high."

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In other industries, such error rates are sustainable. But when lives hang in the balance, the value of the right information - delivered with quality assurance at the point of care - is absolutely essential. "In the US, the equivalent of a jumbo jet full of people die every week through adverse events," King said.

"And it's mostly from a lack of information."

The opportunity

These are problems with which the right use of IT can provide real solutions. Government funding is increasingly being funnelled into e-Health - as stakeholders in the health industry realise that they need to find more efficient ways to process health information to meet future population needs.

"The pressure on the health system will get so large, that [higher IT investment] will simply have to happen," McCabe said. "A better use of IT will be the only way to have a sustainable health system." The IT industry, he said, should see these problems coupled with "a great sense of opportunity".

"In terms of the potential value that can be delivered to practitioners and patients, we are but one-tenth the way along the journey to where we should be," McCabe said. "Between now and 2013, expect a steady rise in annual healthcare expenditure on IT. It's a great place to be a reseller."

Eastern Health CTO, Mark Gardiner, is on the frontline of this transformation across a network of five major hospitals and several smaller facilities in eastern metropolitan Melbourne.

He said the industry has "little islands of automation" - cutting edge areas of technology such as telemedicine. But the missing picture is a solid technology foundation from which healthcare can build its future.

That grounding includes network, storage, disaster recovery technologies and even a technology refresh program for hardware and software. On the storage and network side, there are growing data retention demands in the industry.

"Health practitioners need to have simultaneous, real-time access to information from multiple sources from inside and outside of the hospital," Gardiner said. "We are talking about very large files that need to be stored for a long time, but available online. If we take an X-Ray of a child, we need that large image file accessible for 21 years. I don't know how many other industries have that kind of requirement."

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There is also demand for identity solutions - such as single sign-on authentication systems to enable doctors to sign in once for access to multiple systems.

Security and privacy are also key considerations. People are rightly sensitive about their health records - Gardiner suggested many Australians would rather have their financial information exposed to the public than their health records. Business continuity is equally as crucial.

"Lose a radiology system for two hours and the facility may be able to cope," he said. "Lose it for two days and the manual workarounds aren't sustainable. The crucial thing about health IT systems is this simple: Life and death decisions are made on the quality and availability of data."

The Holy Grail

While these 'plumbing' technologies are essential to get right, there is one IT project widely considered to be the 'Holy Grail' of healthcare IT.

"The electronic health record is the buzz," Gardiner said. "It's all anybody is talking about." Healthcare providers are looking to deploy an IT system that can reduce administrative burdens, facilitate collaboration between stakeholders in the health industry and move clinical-relevant data to the point of care.

Such a system is required to address one fundamental shift that has taken place in the last few decades of healthcare provision. Whereas once healthcare was delivered within the four walls of a hospital, today it is delivered via a range of providers that are loosely connected. It is equally managed at the office of the local GP, within the practices of other allied health practitioners (such as physiotherapists, for example) and increasingly in aged care and community care facilities.

"Healthcare [for Eastern Health] now goes beyond the boundaries of Box Hill Hospital or the Maroondah Hospital and into the wider community," Gardiner said. "It's about collaborating beyond the walls with community services, allied health and mental health."

A system that allows for collaboration between these stakeholders, in which patient data is seamlessly transferred to the point of care at any given time, can cut down on misdiagnosis and enable a more proactive and continuous healthcare system. Better management of illness leads to less re-admissions and less cost burden on the hospital system.

"The philosophy is about keeping people fit and well - keeping them out of hospital in the first place," Gardiner said.

Healthcare has lagged behind other industries when it comes to industry-wide systems, Gardiner continued. "Think about banking - you can stick your debit card into just about any ATM anywhere in the world and access your financial records," he said. "Nothing like that exists for your medical records."

At present, health-related data is stored in silos across multiple organisations.

"To date, systems have been focused on what happens in the hospital, rather than the transfer of information between health providers," CHIK managing director, Sally Glass, said. CHIK is a not-for-profit organisation that facilitates discussion between the health and ICT industries.

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The health industry can only evolve once all parties contribute to a unified patient record - a way in which a patient's history can be transferred seamlessly from one healthcare provider to another.

"The biggest problem in healthcare is the ability to share information," King said. "IT infrastructure as it is doesn't support the free exchange of information between these groups. But for healthcare to evolve, the sharing of this information is vital.

"The challenge is to layer a common infrastructure across all of these healthcare providers to allow them to talk to each other."

Slow progress

State and Federal Governments are speaking the same language. The recent Federal Budget devoted several billion dollars to upgrading healthcare infrastructure - 10-15 per cent of which Australian Computer Society president, Kumar Parakala, expects to flow into ICT projects.

But to date, progress on implementing the vision behind the electronic "unified" health record has been painstakingly slow. The main intergovernmental body driving the push towards eHealth, the National eHealth Transition Authority (NEHTA), has done little more than agree on some definitions and standards. State-based initiatives, such as Victoria's $300 million HealthSmart initiative to replace ageing IT systems across its public hospitals, are also several years behind schedule.

"Nothing has been achieved," McCabe said. "Many projects have been going six or seven years and we've got very little out of it."

Gardiner said there were several barriers to overcome before the dream of a unified electronic patient record can be realised. The first is a lack of communications between industry stakeholders. The second is a lack of interoperability - the technical ability to exchange information between systems.

The third is a lack of agreed standards (outside of HL7), and the fourth, as mentioned, is a lack of funding.

Most of these issues are, in some small way, slowly being tackled.

"The funding issue is being addressed," Gardiner said. "It is a lot more visible now that we need to support ICT in healthcare."

NEHTA has at least made some commendable efforts to ratify a few standards and definitions, Glass said. Communication between stakeholders, she said, is being facilitated via CHIK's e-Health Directory and various networking events.

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As for interoperability, it relies on politics as much as technology. Some analysts suggest that the Howard Government's abandoned 'Access Card' would have provided the means by which patients could uniquely be identified and records exchanged. Its downfall - concerns over privacy - may also plague future efforts to come up with a unified patient record.

There's also a cultural change required within the health industry itself, McCabe said. 'From my observations, one of the real challenges is around doctors themselves," he said. "It's not about privacy, it's about doctors feeling that they 'own' patients and own that data - that it's the basis of their business."

"There are a lot of warring factions," King said. "And they all have genuine interests. But some parties will have to compromise. When you look at a GP claiming ownership of records, it's this simple - the emphasis has to be about care of patients, not running a commercial business.

"It's not unreasonable to expect that part of that information, considering the amount of Government funding that goes into healthcare, should be available to the rest of the system."

Other hot areas

Once the vision of a more horizontal and patient-centric system is achieved, the possibilities start to open up for more cutting edge IT solutions to come to the fore.

Managing director of clinical trial management ISV, Evado, Jennie Anderson, said opportunities existed beyond the huge applications needed for managing health records. Monitoring was one area worth consideration as the convergence of mobile devices, networks and applications enable high-risk or chronic patients to be managed in the home.

McCabe said 'continuous monitoring' is the key to reducing the burden on hospitals and aged care facilities. It involves aged care patients, people with disabilities or people with chronic illness using wearable devices or devices mounted in the home that connect wirelessly to patient administration systems and continuously upload information on the status of the patient.

"I expect to see a future where anybody over the age of 70 wearing one of these devices is interfaced back to the hospital via their cell phone," he said.

Telstra is one Australian company convinced of the power of such an application. The carrier is seeking commercial models for several devices and related services which, when connected to the mobile phone via Bluetooth and in turn transmitted across its Next G network, can alert the patient, their family or doctor around key health indicators.

"It's about helping people manage their illness better," Telstra's Elizabeth Aris said.

"We are working out the best commercial model needed. For a solution like this, there's a pharmacy involved to sell the device, a doctor involved to monitor the data, an end patient. The reality is that all of them are likely to be a Telstra customer, so we have a unique position."

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Telstra will make a margin from the device sale, but also benefit from increased use of its network. "Certainly you need more than 256k connections for some of these applications - more like one and two megabytes," Aris said. "Doctors will need to upgrade to business-grade broadband with backup, storage and security."

There are many other healthcare IT projects predicated on wireless technology. Whereas in the past they carried around chunky paper directories, today's doctors and pharmacists have started to use real-time, up-to-date online versions of MIMS, a popular medicine information directory, on their PDA.

Roving community nurses in regional areas like Ballarat, meanwhile, are gaining an extra two hours a day of serving patients - thanks simply to a notebook computer and wireless laptop card. Wireless also has a huge potential within hospitals, according to McCabe, especially in the area of 'in-hospital asset management'.

"I'm talking about RFID on everything," he said. "It's the application of spatial or location-specific data on everything from mobile medical equipment, beds and bedpans, to the staff and the patients themselves.

"The cost of this technology is coming down dramatically and the benefits are obvious." McCabe also sees big opportunities in analytical software. The same business intelligence software developed by the likes of Business Objects or Cognos, he said, has wide application in healthcare.

"As more and more patient data is collected, practitioners can start making smarter decisions around deployment of assets and diagnosis," he said. "You can get wonderful results. If you have business analytic skills, this is an area of lucrative growth."

Data mining, Gardiner said, can be used to help augment a clinician's capacity to make good decisions.

"Practitioners are faced with so much information, they need IT systems to alert them to potential problems," he said. "The system might, for example, alert a doctor that what they have just prescribed is going to have side effects due to a patient's medical history or allergies."

A challenging industry

While opportunities for channel partners in healthcare abound, the industry isn't without its challenges.

The first major challenge, at least according to those trying to sell into the industry, is constrained budgets.

"A lot of healthcare providers are grappling with budgets for IT being more limited than other industries," EMC's ISV manager, Mark Read, said. "The data they are protecting is very important, but because of budget constraints there aren't a lot of people to manage the IT infrastructure."

This funding, and most decisions around healthcare for that matter, comes from a wide variety of stakeholders.

"Engaging in health is difficult," Dembo said. "Unlike a bank, the buck doesn't stop in one place - there are multiple stakeholders in organisations that are loosely coupled. That is why the sales cycle is long."

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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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As of last month, Microsoft had recruited almost 1000 channel partners in Australia targeting health, from smaller companies right through to the likes of Dimension Data, Fujitsu, Data#3 and Avanade. The vendor has built up its local healthcare dedicated sales team from four people two years ago to 12 today.

Microsoft has undertaken a range of initiatives to win over the healthcare vertical. It has built a Biztalk-based piece of middleware called the Health Connection Engine, to be used as a foundation for eHealth delivery, and made it available for free via open source. It has also published a series of whitepapers called the Connected Health Framework, again made available for free. It has launched a health-specific search engine called MedStory, and in the US has launched a site called HealthVault which allows consumers to upload their own health history onto the Web.

Microsoft is also working in collaboration with the UK's National Health Service (NHS) to develop a single standard user interface - to be used across all NHS systems - which will again be made available free of charge to other ISVs to incorporate into their solutions.

"There has never been any consistency in healthcare about how data is presented application to application," Dembo said. "A nurse in one hospital has to re-learn systems at the next. We are working on a more consistent and intuitive interface. We are industrialising IT for clinicians."

Microsoft has also acquired a 50-module Hospital Information System and related patient administration system that it will sell under the AMALGA brand.

"Hospitals are baulking at the price of solutions on the menu," Dembo said. "At between $50 million and $150 million, they are too expensive and overly architected for your average health practice.

"We believe we can disrupt the market. We realise that this is an opportunity to engage the channel, from Accenture down to the two-man shop. We are building visibility around our products, encouraging partners to profile themselves, running deeper dive technical sessions to show partners how to build solutions out of these products."

Not everybody, however, is convinced that it's the cost of applications that's the barrier towards achieving a more efficient health system.

"The problems have nothing to do with software being too expensive," King said. "That's a furfy.

"Intel and Microsoft have got it wrong. It's not about a piece of technology. This is not going to be fixed by an IT guy with a bit of software. I think Microsoft is being opportunist - it sees dollars in this industry and thinks 'why not get involved?'"

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King said these traditional IT infrastructure players failed to recognise that healthcare is a 'protocol-driven' industry.

"The core part of healthcare is about domain knowledge. It's about making sure systems add value to the practitioner."

It's not the cost of the software license, according to King, but change management that poses the main problem to getting new healthcare IT initiatives up and running. "Training 2000 nurses and 600 doctors on a new product is where the cost is," he said.

Glass agreed that change management is "very difficult".

"Especially for clinical practice systems," she said. "It's much more complex and there is a workforce of clinicians - from nurses, to doctors, to allied health groups that are stakeholders. You are disrupting how these medical professionals have practiced for years.

"It isn't necessarily a technology problem. The pitfall that often trips people up is change management and training."

Indeed, Gardiner, whose hospital network is planning the introduction of such a system, said the technology aspects of the project "shouldn't be that much different to any other organisation from an implementation perspective".

"The main pain point is the backfill of clinical staff," he said. "You need to take clinicians offline."

The strategy

McCabe said Microsoft's vision is a "grand attempt" that "really shows some leadership".

"But you can't ignore the legacy investment in health systems," he added. "Any change will require integration with existing systems, which is always expensive, as it involves a lot of human hours. I just hope [Microsoft] knows this will be a long journey."

These pain points can only be good news for a clued-in IT sales channel. Opportunities around training and systems integration will abound.

"I want to work with people that understand the needs of Eastern Health," Gardiner said. "They need to know my pain points, appreciate the impacts of what happens when a system doesn't work or a project isn't delivered on-time. I want to work with companies that spend the time and effort to ask about my strategic direction."

While it's not without its challenges, Gardiner said the industry delivers rewards.

"I came into healthcare for this opportunity," he said. "It's the last bastion, an area where ICT can really make a difference, where it truly is an enabler of change."