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CSC deal rattles NME procurements

13 December 2012   Lis Evenstad & Rebecca Todd

CSC’s interim agreement with the Department of Health is creating huge uncertainty in the North Midlands and East NHS IT market, with major procurements put “on hold” while hospital trusts evaluate the deal.

EHealth Insider reported last week that the interim agreement between the DH and CSC will give the first ten trusts that commit to taking the Lorenzo electronic patient record system a signing-on bonus of £1m for implementation expenses.

This is on top of £4m in funding that up to 20 trusts can get for deployment costs.

Derby Hospitals NHS Foundation Trust and Walsall Healthcare NHS Trust have put their patient administration system procurements “on hold” while they assess the Lorenzo offer.

Sheffield Children’s NHS Foundation Trust has also told suppliers that it is considering the CSC deal.

A statement from Derby said: “The trust was made aware of the option to take Lorenzo and the new deployment model part way through its patient administration system procurement.

“There are a number of potential financial and strategic advantages in taking this option that the trust needs to seriously consider and hence has paused the PAS procurement pending a full evaluation.

“We are working closely with NHS Connecting for Health and CSC on the details of the product, deployment model and approval process and a final decision will be made early next year.”

Head of healthcare at IT trade association Intellect, Jon Lindberg, said suppliers were concerned with the lack of clarity surrounding the deal and the impact it has had on the market.

“Suppliers are witnessing procurements being cancelled mid-way through and some being reviewed to take into account the new offer, but still continuing the process without any guarantee that it will be fulfilled,” he said.

“Overall this new deal is hurting small, medium and large companies who are now having to review their strategies and market research, and the added woes of having lost money and time bidding for opportunities that have or will be cancelled.”

He added that the DH should be responsible for giving clarity and support to the market with relevant information.

Cerner’s head of corporate affairs, Simon Hill, said selecting the right IT system is one of the biggest decisions any NHS trust will make over the next decade.

“When the government announced it had scrapped the National Programme for IT in the NHS, we believed that this would create a market that would allow the world’s best companies to compete for NHS IT business,” he said.

“We are concerned to hear reports that NHS managers might be encouraged to sacrifice long-term strategic IT decisions and opt for a system that is unfinished and unproven in order to access short-term cash incentives.

"But until we understand the nature of any agreement, it would be inappropriate to speculate.”

Stalis chairman Roger Wallhouse told EHI that trusts often do not recognise all the time and all the effort that goes into a procurement.

“It has a cost and in the end if the procurements are not managed efficiently and effectively the NHS will ultimately pay for that,” he explained. Suppliers are prepared to accept market risk “up to a point," he added.

“But when it’s against a supplier that’s able to put supposedly a million pounds on the table, in a cash-strapped financially challenged NHS, it’s unlikely that trusts can turn their back on such an offer.

“If either the money is necessary because the cost of implementing the product is so high that it’s needed to create a level playing field with others, or it’s there because CSC and the DH are determined that they need to offer an inducement to trusts, that’s fine.

"But don’t expect other suppliers to bid competitively against that because it’s not fair.”

Sheffield Children’s NHS Foundation Trust is in the middle of a PAS procurement, but sent a letter to suppliers this week, saying it is “assessing the interim agreement's suitability in relation to its requirements for a PAS/EPR in addition to continuing with the procurement process.”

“Whilst the trust needs to evaluate all available options to it for a PAS/EPR, please note that, at this stage, the procurement process will continue,” it adds.

Walsall Healthcare NHS Trust went out to tender for a PAS in April this year, but has put its procurement “on hold” according to director of informatics Steve Darkes.

“We are currently reviewing the Lorenzo system and will be looking at the qualities and benefits that the system can offer the trust over the coming months,” he said.

“A decision will be made in March 2013 as to which system we will be purchasing.”

A board assurance framework dated October 2012 said Walsall had agreed to proceed with Lorenzo and strategic health authority approval was being sought.

Tameside Hospital NHS Foundation Trust is the first adopter of Lorenzo under the terms set up in the August IA. A trust spokesperson confirmed “some central funding” is available for trusts to help cover implementation costs.

“This is subject to approval of a robust, value for money business case. We are currently developing our business case and will put this forward to the DH for approval in due course," he added.

Other trusts that have expressed an interest in taking Lorenzo are; the Ipswich Hospital NHS Trust; South Warwickshire NHS Foundation Trust; and University Hospitals Coventry and Warwickshire.

EHI asked the trusts to comment on whether they are considering the new CSC deal, but got no response.

 

 

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Related Articles:

12 News: Next ten Lorenzo adopters each get £1m | 3 December 2012
3 Insight: Think again about Lorenzo | 15 October 2012
News: CSC sets up Lorenzo user group | 10 December 2012
43 News: New NME Lorenzo trusts poised to commit | 16 August 2012
Last updated: 18 December 2012 11:20

© 2012 EHealth Media.


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Quality Costs

ehireader18to14to12 91 weeks ago

Unless there is more to this than meets the i, Trusts will be able to make an Independent choice. I do not envy the decision makers, but I would advise them to put the patients 1st. Things they may wish to think about:

1. Data Quality

2. Support (and performance eg. getting data into the Trusts DW)

2. The unique NHS patient service user pathway

3. Patient and service user choice

4. Patients (and in the future service users) access to thier data

and information

5. Integration of patient service user data with other

organisations (both non commerical and commercial)

6. Future development, particularly with respect to requirements

which will be of benefit to patient service user (quality of care

and outcomes)

7. Usability


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Yeah right...

Daniel Defoe 91 weeks ago

Try telling that to a Finance Director who is having a cheque for a million pounds, and some implementation and support funding in addition waved under his nose, and who sanctioned the money originally budgeted for NPfIT/CRS to be spent on other things (or more likely his predecessor did).


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Nothing new...

NHSCIO 92 weeks ago

Is this really any different to other Suppliers offering incentives, such as be a reference site for us and we'll knock of 10%, get us another deployment and we'll knock of 15%. Some of the so-called outraged suppliers have been doing this for years. Also, many of the established products are financially out of reach for smaller Trusts - not seen any comments suggesting how they may get an EPR - a 37m business case like Rotherhams for EPIC would bankrupt some...


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... oh I think it is!

PhilC273 92 weeks ago

Actually I think it is very different. If a site agrees to be a reference site then they take on extra work and resource requirements. They also need to be able to show the product working well, and if doing so leads other Trusts to buy it then it seems reasonable to get some reward. Here we are talking not only of incentives being given without a necessary basis of working functionality but also it is taxpayers money!


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37 million pound business case

Daniel Defoe 92 weeks ago

Rotherham? EPIC? Has it been raining so much in the north that parts of it are floating down to land in East Anglia? Or do you know something we don't know?


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Oops - Meditech of course!!

NHSCIO 91 weeks ago

Must have been the auto correct!!


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Stifling the competition

Laburn 92 weeks ago

So yet again, the market will be tied up with CSC being able to stifle any real competition for the Trusts to select the best product rather than what is on the table. It is not a UK product, has not been developed by people with knowledge of, or experience in the NHS market, but given the 1m 'incentive' it will be difficult for cash strapped Trusts to justify a business case for taking anything else. And where is the money coming from? No doubt the good old taxpayer.

This is an appalling situation.


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LORENZO not a UK product?

TCP 92 weeks ago

Not a UK product? Not developed by people with knowledge of the NHS market?

If you're referring to LORENZO, as far as I know it remains the only PAS/EPR developed with NHS input to an NHS specification.


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UK product

TCP 91 weeks ago

I was of course referring to LORENZO being built to an OBS issued by CfH and achieving the RKM. If other systems were similarly built and tested then I bow to your superior knowledge Mr Defoe.


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UK Product

Daniel Defoe 91 weeks ago

TCP, you say (about Lorenzo): "...,as far as I know it remains the only PAS/EPR developed with NHS input to an NHS specification...". I'm not sure where you've been for the past ten or so years, but what about, for instance, System C's Medway; OMS's OASIS; IMS MAXIM; Silverlink etc? And interestingly, all of them have a working, functional, acknowledged installed NHS base. When Lorenzo has something approaching even the number of installed NHS bases which any one of these applications has, then please come back and argue your point again.


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not just stifling competition

in arduis fidelis 92 weeks ago

stifling development and advancement too. In my experience most system contracts managed through the LSPs have so many restrictions around version releases and upgrades that by the time a system is fully deployed it is several versions out of date compared to if purchased direct from the supplier, and you will never catch up because theres a cap on how many upgrades your LSP contract will allow.

In response to Taxpayer555, I suspect one of the reason why trusts didn't take it as a freebie from NPfIT before, is because it didn't actually exist as a finished product


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The Ford Edsel of Healthcare IT ?

Taxpayer555 92 weeks ago

Under the NPfIT Trusts could take Lorenzo for free, but they chose not to do so. Now a chosen few are being paid to take it. If it is as great as promised, it is difficult to see why a Trust needs to be incentivised to take it. So: Generosity ? A reluctant concession to the closing of the CSC NP contract ? Another 10 sites to add to the 40 CSC already controls?

Can't see why DH agreed to this - it seems a poor use of taxpayer leverage. Does the NAO need to look at this...


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Is anyone asking the real question?

in arduis fidelis 92 weeks ago

Whats the catch. If a Private Sector company/LSP is offering shiny/financial incentives, essentially paying you to take its product, then the first thing to do before signing anything is look through the small print, and I don't just mean in the contract, i mean in the Companies corporate strategy and its future product roadmap. EG If in three years time (or however long the contract is) you decide you aren't happy with it and want to move to another product how easy is it going to be to get them to release your data to migrate.....Do they have another product in the pipeline that they're going to recoup the expense with by telling you in the future that you need to buy it because they are no longer supporting what you have.....to quote the King of Siam etc, etc, etc.......and so on.....


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Why?

John Harry 92 weeks ago

Why, after almost ten years of abject failure to deliver, is the Department of Health paying trusts to select CSC/Isoft? Why not just pay the next ten trusts that select any supplier the million pounds?


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Why? The answer is money

NHS know how 92 weeks ago

The DOh has signed a contract that means if it walks away it pays more to CSC than it will pay to Trust to 'bribe' them to take Lorenzo. The DOH and CfH have turned into Lorenzo salesmen spouting how fantastic it is, CSC are more realistic.

The work Trusts have to put in to get sign off is HUGE so a lot of Trusts may walk away based on that, when they work out they'll need 50 or so staff to do it in the 28 week framework before they get a penny from the DOH. However the financial incentive per Trust is a lot more than is shown on here. Think being paid to get a new PAS/EPR rather than being incentivised.


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Why? Because it might work

Nick Tordoff 91 weeks ago

Two points.

I have spoken to a number of Trust DIs. They are no more likely to take the word of the DH or CfH that take their financial advice from Wonga. They are going and looking for themselves

The commitment is huge and CfH/SHAs are requiring Trusts, and Trust Boards in particular, to have done their resource planning before not during implementation or after things start to do belly up. That seems to me to be pretty reasonable given the track record of NHS organisations trying to do these things on a shoestring.


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Why

Unknown 92 weeks ago

Good point - isn't the current DH stance/offer is anti competitive? Is it in breach of European competition law?

Post edited by EHI


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