The Government is planning to deliver an ambitious new NHS IT
procurement model by 1 April 2003. James Rogers looks at the
difficulties of improving technology procurement within the UK's
largest organisation
The latest stage in the Government's ongoing campaign to improve
public sector IT procurement was unveiled at last week's Healthcare
Computing 2002 conference in Harrogate when a senior Department of
Health (DoH) mandarin described an ambitious plan for buying IT in
the NHS.
Sir John Pattison, director of research, analysis and information
at the department, outlined the government strategy to build a
streamlined NHS IT procurement model by 1 April 2003.
He said, "We will use April and May to develop standards and
specifications, then we will work with the Office of Government
Commerce (OGC) and the Office of the E-Envoy to streamline the
procurement process for IT in the NHS."
This is a major undertaking since the NHS, which employs about 1.2
million people, is one of the largest organisations in the western
world and uses a vast array of disparate IT systems. Devising a
procurement model to fit an organisation as varied as the NHS is a
potential headache on a number of levels, from technical issues
through to sheer logistics.
Precise details on exactly what the new IT procurement model will
entail have yet to be revealed although experts are already warning
of the potential pitfalls for the NHS.
Murray Bywater, managing director of IT healthcare specialist
Silicon Bridge Research, said, "There is a big difference between
procuring Microsoft desktop products and the likes of electronic
patient records systems, which are a combination of many different
product elements, services, as well as change management."
We have got to wait and see, he added.
Bywater also voiced his concerns about the possibility that the new
procurement model could exclude certain IT suppliers from the
market. He explained, "It will be worrying if the Government were
contemplating reducing the number of active players in the market
because this could reduce available implementation resource at a
time when it is already in very short supply."
It should also be noted that the health service, like much of the
UK public sector, has been dogged by IT project problems.
In the early 1990s, for example, a centralised approach to rushed
IT delivery hit the hospital information support systems
initiative, losing up to £103m and prompting criticism from the
House of Commons Public Accounts Committee.
Then there are the funding issues. Even the best-devised
procurement model in the world will be rendered useless if
inadequate funds are made available to develop IT.
Even Pattison acknowledged the importance of the funding question
during his speech at the Harrogate event. "There needs to be a
massive increase in the resources made available for implementing
IT in the NHS," he said.
Investment in NHS IT has been inadequate even when compared with
other health services and sectors, Pattison added.
In the NHS, however, the issue of funding is about much more than
just making money available for IT. Even if the new procurement
model is in place in 12 months time, NHS trusts could still face
the ongoing challenge of balancing their budget for new IT systems
with other healthcare demands.
The perennial problem for NHS IT managers is that scarce funds for
building effective IT strategies, unless they are specifically
ring-fenced, are often devoted to other more pressing
concerns.
The simple fact is that problems such as winter bed crises often
take precedence over IT. As one IT manager in a southern NHS trust
attending the Harrogate conference explained, "There isn't enough
funding basically." There are lots of priorities and IT is only one
of them, she added.
In this way, the DoH certainly has its work cut out but at least it
is drawing on expertise from right across government in the shape
of the OGC and the Office of the E-Envoy. The OGC in particular is
not afraid to buck the trend of government procurement and devise
new models, such as the recent public sector-wide software deal
with Microsoft, IBM/ Lotus and Sun Microsystems.
If the DoH is to follow suit, however, then it must pay close
attention to the specific needs of NHS IT managers. Just as
importantly, government officials should also be prepared to drive
some very hard bargains with suppliers. Devising new procurement
models is one thing, but making them work is something else
altogether.
NHS organisations are already setting something of a precedent for
using new forms of IT procurement. For example, five London
hospitals recently banded together and signed a £3m contract with
US banking and healthcare specialist Misys to deliver a new
pathology IT system.
What is interesting about this move is that it highlights two
growing trends in public sector IT. The first is a clear shift
towards purchasing off-the-shelf products and the second is
collaboration between organisations to achieve economies of scale
from suppliers.
Whatever IT procurement model the DoH decides to implement by April
2003, ensuring the ability of NHS trusts to collaborate and use
off-the-shelf products will be critical.
The Government, of course, feels that it has already proved its
ability to roll out major IT projects such as the ground-breaking
£325m NHS human resources and payroll system that was unveiled last
year. The future, however, poses fresh technology challenges and
any new IT procurement model must take this into
consideration.
With speculation growing that next month's budget will be geared
towards helping the cash-starved NHS, the Government could be in a
good position to bolster the health service's IT. The long-term
success of this, however, will depend in no small measure on
appropriate procurement methods. Pattison's announcement is
certainly a step in the right direction but the health service
still has a long way to go.
Key dates in NHS IT procurement
March 2002
Government signs software licensing deal worth
more than £9m with Novell in an agreement that is expected to save
the NHS £18.5m over the next three years. The contract, which is
available to all NHS organisations in England, is expected to cover
about 100,000 desktops
Five London hospitals band together to sign a £3m contract with US
banking and healthcare specialist Misys to deliver a new pathology
IT system. The London hospitals deal will see Misys provide a
single pathology system to the Hammersmith, Charing Cross, Chelsea
& Westminster, Queen Charlotte's and St Mary's hospitals.
December 2001
NHS awards a £325m contract to a
consortium headed by IT healthcare specialist McKesson to build a
unified human resources and payroll system. The deal is part of the
Shared Services initiative that was launched in October 1999 to
make better use of NHS resources
October 2001
NHS signs a three-year software
subscription contract with Microsoft. Government officials estimate
that the deal will save the health service more than £50m over the
life of the contract
January 2001
Government announces £851m boost for
health service IT funding with the launch of the Building the
Information Core - Implementing the NHS Plan strategy.