Health IT and the Financial Fallout

18 January 2009 (Last Updated January 18th, 2009 18:30)

Cash-strapped healthcare authorities all over the world are struggling to make ends meet. Will sophisticated automated software solutions still stand a good chance of remaining top of the agenda for hospitals on tight budgets? Ozge Ibrahim reports.

Health IT and the Financial Fallout

Recent reports reveal the National Health Service (NHS) in England and Wales is facing its biggest financial challenge for more than a decade. This has led to senior health figures warning that the financial surplus in England will only act as a temporary cushion as public spending is reduced to cope with the downturn. As a result, the implementation of hospital information systems (HIS) could suffer, especially in authorities where capital is scarcer.

As documented recently on pharmaceutical-technology.com, Electronic Networking: From Physician to Prescription, much investment is still needed across IT healthcare systems.

The good news is that short-term investment is still likely to be made, due largely to an urgent need to clear backlogs.

Dirk Schuhmann, head of public relations at software systems company InterComponentWare AG (ICW), says that although the economic crisis will not help matters, the "huge backlog" means investments in this area will ultimately go ahead.

Information investment

HIS may be complex and costly, but they provide a valuable method of enhancing the acquisition, storage, retrieval and use of information in health and biomedicine. One area currently experiencing growth is the market for automated healthcare administration solutions.

"Much investment is still needed across IT healthcare systems."

Such systems, which track and maintain the administration of medicines, can in the long run help to reduce the amount of time spent on administration by staff. One such US-based manufacturer of hospital systems that is successfully branching out to Europe and beyond is Omnicell.

CEO, chairman and founder of the company Randall Lipps says he believes the current credit problems will not affect future investment in IT solutions. "Although we are experiencing an economic downturn on a global basis, we know that healthcare will continue to invest its capital dollars wisely," he says.

Omnicell systems are designed to store, package, barcode and order issue, in addition to providing information and controls on the use of medications. Last year the company sold its automated stock cabinets to the Foundation Trusts of Guy's and St Thomas's and Kings College Hospital in England in a deal worth more than £6m.

While initial implementation costs can run high, a system which can order and administer stock throughout the hospital has the potential to streamline costs in future, according to the hospital administrators.

The automated Omnicell cabinets at Kings College Hospital can manage stock levels by reducing orders to match actual demand in theatres or on wards. The process "should help to prevent products going past 'use by dates'" and "generate further savings" in future, say hospital administrators.

"Omnicell systems are designed to store, package, barcode and order issue, in addition to providing information and controls on the use of medications."

Head of Procurement at Guy's and St Thomas', David Lawson, says that apart from saving time for busy hospital staff, managers say the system provides them with an unprecedented level of cost control.

In addition, the analysis and reporting software will enable hospitals to chart the cost of providing care to individual patients.The first of the systems went live in selected departments in November 2008, with subsequent installations starting in 2009. Guy's and St Thomas' Hospitals are also planning to use the systems for medication later on this year.

Fighting the recession

Hospital trusts in Britain and Europe are currently keen to adopt automated IT systems to serve across a multitude of hospital departments for a range of stock types.

Manufacturers such as solution provider Omnicell are optimistic about the future and are now targeting more sophisticated A&E departments and operating theatres, confident that uptake rates will sustain into the recession.

When budget cuts begin to hit procurement departments and other decision makers, the long-term benefits such as saving staff time and improved efficiency of stock control will have to be weighed up against immediate cash flow concerns. The uptake of this type of technology will therefore depend upon the depth and scale of the credit crisis and whether the benefits of such systems can overcome budgetary concerns.