Lothian Health Board has announced that it has terminated its contract with McKesson for the provision of a Hospital Information System (HIS) for the flagship Edinburgh Royal Infirmary (ERI).


The decision marks a further significant blow for McKesson in the UK.  In 2003 the firm was dropped at an early stage in the £2.3 billion procurement undertaken by the National Programme for IT in England. 


According to reports in the The Scotsman, deployment of the clinical system has been hit by a series of delays, resulting in the system being over two years late and leaving the hospital without a fully operational HIS. 


McKesson signed a £30 million contract to provide ERI with a new HIS system in 1999.  The contract was intended to ensure that the HIS was operational by the first phase of the new ERI opened in February 2002.  Five years on, and two years over schedule, the system is still not fully operational.  


Plans to launch the system in February are reported to have been recently shelved following complaints that doctors and nurses were unable to find information.


The HIS was meant to provide Edinburgh with a full electronic patient record system that would allow staff to access patient records at their bedsides.  The new private finance initiative (PFI)-built ERI was specifically designed to operate as an almost paperless hospital and was built without large storage facilities for paper medical records.


In October 2002 the Edinburgh Evening News reported that ERI was having to pay tens of thousands of pounds to rent additional storage space for medical records as delivery of the HIS system was behind schedule.  In February 2002 the trust was further reported to have given McKesson a second chance and threatened to impose fines for any further missed deadlines.


In a statement issued at the end of last week Lothian Health Board said “Over the past few years the changing information technology infrastructure in the UK has culminated in a situation which means it is no longer feasible to realise the vision we jointly shared for the Hospital Information System."


The statement continued: “The Division [University Hospitals] and McKesson have therefore agreed that the best way forward for all the parties involved is to amicably terminate the contract and for the division to explore other routes for the delivery of their future HIS service requirements."


No payment has been made to McKesson for the HIS service. But no details are available on whether McKesson has had to make any penalty payments to ERI.


Divisional acting chief executive, David Bolton, said: “In discussions with McKesson we all agreed that termination of the contract was the sensible solution for both parties and the division will actively pursue alternative solutions as part of Scotland wide initiatives."


Staff transferred to McKesson from the NHS to work on the project will now return to the health service. The running of the parts of the HIS system which are operational will be transferred from McKesson to the NHS and serviced by the ERI’s IT team.

McKesson declined to provide any additional comment when approached by E-Health Insider.  A spokesperson for ERI merely commented: “We’re looking into our options."


Despite the set-back in Edinburgh, McKesson still has major UK health IT projects on its books. In 2001 McKesson was awarded a £325m PFI deal to deliver the Electronic Staff Record system for all 1.2 million NHS staff.  McKesson also runs the NHS-wide clearing service.