The Department of Health is considering terminating its multi-billion pound local service provider contract with CSC, following the company’s continued failure to deliver Lorenzo to the North, Midlands and East of England.
The trigger has been the failure to hit the milestone of getting Pennine Care NHS Foundation Trust live with the iSoft system, due to have occurred on Monday.
EHealth Insider understands that the long-running CSC contract renegotiation has been escalated to NHS chief executive Sir David Nicholson.
A spokesperson for the DH confirmed that Pennine Care had failed to go live in line with a remediation plan drawn up by CSC, and that it has notified the company that it is in breach of its contract.
The spokesperson told EHI: “We can confirm that the Department of Health is considering the options available under the current contract, including termination.
"This action follows the notification by CSC of its failure to meet a new deadline that CSC itself proposed for delivering "Lorenzo" (a patient information system) at Pennine Care mental health trust."
Usually the DH routinely declines to offer any comment on contract negotiations.
EHI understands that the latest move is based on CSC’s inability to meet repeated delivery milestones and reduced NHS trust demand for the Lorenzo product, exacerbated by a reduction in its scope negotiated to reduce the cost of the programme to the government.
As a result, the DH is thought to want to completely re-set the LSP deal to reflect changed realities.
The outcome of the ‘reset’ negotiations now underway could be a much reduced CSC deal, covering far fewer trusts across the whole of the NME. If this does occur there will be close scrutiny of the price paid for reduced delivery.
The DH has been under pressure from MP Richard Bacon to show that any new deal for the NME would be value for money.
Bacon, a member of the Public Accounts Committee, and a long-standing critic of the national programme, has written letters to both Connelly and the National Audit Office asking questions about the deal and earlier contract re-signs.
However, the DH has yet to resolve legal action with Fujitsu triggered by its departure as LSP for the South of England in 2008.
Fujitsu is rumoured to be seeking up to £700m. Bacon has told EHI that he believes the Department is under pressure to sign a new deal to avoid further legal battles.
According to analysts TechMarketView, CSC invested a further £43m in the NHS contract in Q3 for which it saw just £11.2m in revenues.
In the previous quarter, it invested £75m for a return of £14.3m. With the missed go-live at Pennine Care, the company will not receive expected milestone payments.
Insiders suggest that CSC may have already spent up to a £1 billion on its NHS deal, which was originally meant to be worth £3.4 billion to it. The company has already been required to deliver £500m of savings.
Last week, EHI exclusively reported that CSC was unlikely to meet the remediation plan that detailed how it would complete the deployment of Lorenzo at four key early adopter sites: NHS Bury, Morecambe Bay University Hospitals NHS Foundation Trust, Birmingham Women’s NHS Foundation Trust and Pennine Care.
Although NHS Bury went live on schedule, the remediation plan was put in place after Morecambe Bay failed to go live with the latest version of the software, known as Release 1.9, at the end of March 2010.
The deadline had been set by Christine Connelly, the DH’s director general for informatics, as part of a package of measures to show that suppliers to the National Programme for IT in the NHS were making significant progress in the acute sector.
Morecambe Bay eventually went live in June and Birmingham Women's followed in late October. However, DH confirmed yesterday that Pennine Care had not gone live on its latest target date of 7 February.
With the NHS chief executive now personally involved matters appear to be coming to a head.
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How come it is the NHS that is loosing out.It is I, LeClerc 227 weeks ago
When these contracts were negotiated and signed by the CfH Mr.Granger made great store of their link to delivery, he even shot a few huskies on the way. So how come it seems that in some significant cases it is the suppliers that have us over the barrel? What happened to husky shooting?
ASCCContrarian 227 weeks ago
On a personal level, I think the CSC contract has delivered significant benefit to the NHS. It has provided us with good systems and functionality. It has been delivered cost effectively.
Maybe someone should take the brave decision to break the contract due to persistent none and sub-standard delivery at excessive cost.
Looking forwards to the Government's brave new world, considering their desire for a plurality of systems, maybe there is an opportunity to expand ASCC to cover a wider range of systems of which Lorenzo and other CSC offerings are just one of many.
Or maybe I'm being too controversial.
Your wish is already granted...Daniel Defoe 227 weeks ago
“…Looking forwards to the Government's brave new world, considering their desire for a plurality of systems, maybe there is an opportunity to expand ASCC to cover a wider range of systems of which Lorenzo and other CSC offerings are just one of many…”
Er, the ASCC Framework already does that (cf Blackpool etc).
*Can* the whole contract be terminated because of failure to deliver secondary care EPRs?Mary Hawking 228 weeks ago
CSC has a contract to deliver a basket of services as aprivate provider.
The details of their contracts are "commercial in confidence" so we just don't know the details. (Not sure whether all commercial contracts should be generally available - different discussion).
Does failure to provide a very large section of the contract constitute a **legal** grounds for terminating the whole of the three seperate contracts held by CSC? especially if the original contracts provided for delivery of sites - hospital trusts and GP practices - to installing LSP (CSC) products or supported products?
telling the wheat from the chaffIt is I, LeClerc 228 weeks ago
I would suggest that yes, CSC has had enough time to deliver what NPfIT originally envisaged, in fact it should be several versions ahead. So one of the questions should be “why have CSC and iSoft so consistently failed?”
Well in iSofts case it may be due to conflict of products and strategy (ie: ensuring the have a life after NPifIT, just in case), running so many alternative (better?) products and their unusually management style.
For CSC, who knows. I would think their arrogance and complacently has long been replaced been replaced by just hanging on hoping to be the last man standing and recover their investment.
As others have said, between CSC and iSoft there are many good products. I have been seriously impressed by many CSC presentations, but as they date back 3 years or so one must question the robustness and quality of these.
Perhaps the best answer is a return to the open market and see if their products and service can survive (win business) in open competition.
What about the total contract - and iSoft?Mary Hawking 228 weeks ago
The original LSP contracts contained a lot of deliverables - not just acute trust deliverables.
Some time back, Yorkshire and the Humber SHA Board minuted that they were evading penalties for failing to deliver on contract committments in the acute sector by over-delivering in general practice.
If iSoft is still unable to deliver in the acute sector, will the shortfall have to be delivered by forced migration of GP practices to the LSP GP system on offer? and if so, what are the surviving mechanisms for ensuring this, and if the contract is not delivered in secondary care, who is expected to foot the compensation bill?
What is Lorenzo?Jon Hoeksma 228 weeks ago
Just as an aside, after years of being told that NPfIt was delivering care records systems - formerly integrated healthcare records, and before that electronic patient records - were anything but a patient information system (far too simplistic) today's statement from the DH described Lorenzo as, yes you guessed it, a "patient information system".
So just what is it that CSC is delivering? What's the best way to describe it?
There might be a way out of this mess.ehealthsolutions 228 weeks ago
There are obviously still problems with "Lorenzo PM (patient manager)" but iSOFT do have some very useful web based applications which can work with current PAS systems. Why does CSC not offer these modules to Trusts as an interim measure. I have seen the iSOFT Medchart prescribing solution and was very impressed.
Medchartgeorge385 228 weeks ago
I've also seen Medchart and was reasonably impressed by it. But it was in no way "ready to go" for the UK market.
IIRC intravenous (slow/ combination and S/C Infusions for example) were not supported nor was MDDF - although to be fair some of the questions I put to the demonstrator at the time could not be answered.
No doubt the product has moved on since I last saw it and maybe my perceived short comings have now been addressed but I feel sad that just how many times have some of us pressured the powers that be (both within the NHS and the software development sectors) over the years to develop 'home-grown' ePrescribing - from the bottom up with the UK prescribing model in mind.
How many thousands of man hours have been thrown away just to pick up something that does part of the job from abroad?
UK PLC – still being sold short by short sighted "management"
Why now?Charles Gallagher 228 weeks ago
Seems strange that after all the previous threats, missed deadlines, financial pressure et etc that the DH decides to throw in the towel now?
IMHO the real issue is CfH. They seem to continue to form a buffer between the supplier and the real customer which restricts pragmatism and a can do partnership environment which is critical to the success of a Healthcare IT implementation. They are as much use a chocolate teapot!
If the money is committed to CSC get them to deliver stuff that the trusts want. Not some over specified, over engineered, under delivered product that even isoft have disowned.