An analyst report from the US has said that there is a high probability that clinical software firm Cerner will replace GE Healthcare as main the supplier of clinical systems to the NHS in London.
If a change does occur it is likely to initially result in further delivery delays to modernising NHS IT systems in the capital, as part of the late running £6.2bn NHS National Programme for IT (NPfIT).
BT is understood to have been examining options for a replacement for IDX since the beginning of the year due to the difficulties in delivering the system to NHS trusts in the capital. In the past 30 months BT has implemented the software at just one hospital trust.
The report from Leerink Swann, a Boston-based analyst house that focuses on healthcare, states: "We believe that BT and GE will amicably part ways, with BT paying GE to walk away from its PAS contract in the London region. BT will then partner with Cerner, allowing for a more rapid deployment of systems in this politically sensitive region."
The report adds, "After our visit we believe there is a >90% chance Cerner wins at least one additional regional contract with the possibility existing for the company to have four of the regional contracts when all is said is done."
On the timing of any move the report says: "We now expect an announcement by either Cerner and/or BT/GE by mid-July, if not sooner."
George Hill, author of the report told EHI that it was based on multiple senior sources from the London NHS and industry. "They were people dealing directly with the project in a position to give me detailed information," said Hill.
He acknowledged, however, that he hadn’t spoken to BT or GE. Hill told EHI that the report and the predictions it makes are based on interviews carried out with multiple sources close to the project.
The possibility of a change in clinical software supplier in the capital is lent weight by well placed anonymous NHS and industry sources who have told E-Health Insider that BT has been carrying out discussions to find a replacement for IDX since the beginning of the year.
One trust IT director in London told EHI: "I think it’s more certain than a rumour." He pointed to recent indecision and lay-offs in London as an indication of the way the way things were pointing.
Another London NHS IT director said he was now being told that a deal with Cerner was now extremely likely. Asked how likely, he said: "I’d put your mortgage on it".
An IT director from a London primary care trust, meanwhile, told EHI of the planning blight he faced. He said BT had indicated a switch in suppliers was likely for the past few months, and promised an announcement by the end of April and then the end of May.
With three trusts in London – Chelsea and Westminster, Queen Mary’s, Sidcup and University College London Hospitals – all using IDX Lastword and Carecast it is perhaps more unlikely that GE would be entirely supplanted in the capital.
One very senior NHS executive told EHI that he believed what was more likely than a replacement of IDX was a greater choice of systems. "I personally think we will begin to see more of a mixed economy. A lot of trust CEOs were very irritated that they had been told to implement a single solution."
Since buying IDX Corporation in January this year GE Healthcare has been the main sub-contractor to BT in London in the £6.2 billion NHS National Programme for IT. In December 2003 BT was awarded a ten-year £996m contract to upgrade NHS IT systems across the capital.
To date, however, BT has only made limited progress in the acute hospital sector, installing just one instance of IDX’s Carecast at Queen Mary’s, Sidcup NHS Trust. BT says it plans to implement the system at further hospitals by the end of the year but has yet to name the sites.
One industry source told EHI: "There is not one project in the London cluster where there is a delivery date for IDX Carecast." The source added: "If I was in BT’s shoes I’d be cautious until I was sure that Cerner could deliver a working product.
Sources indicate that GE has been seeking to renegotiate elements of the contract with BT it inherited when it purchased IDX. This is understood to include ensuring the contract provides a more certain revenue stream and a strong preference for providing ‘thick’ local solutions, rather than systems principally hosted remotely.
One source told EHI: "Either Richard Granger [chief executive of NHS Connecting for Health] will be told to pay GE as they go, or BT find another partner." They added that any switch to Cerner as the solution provider could run into legal problems with IBM, which bid unsuccessfully offering Cerner for the capital in the 2003 procurement.
In addition to a possible change in London, the report says there is an outside chance that Cerner may wind up replacing iSoft in the two Accenture regions – the North-east and East. The probability of Cerner winding up with four regions is put at less than 20%.
Hill said: "I don’t think it’s any surprise that Accenture would also look at alternatives given the difficulties it’s experienced with iSoft. There are only so many other vendors out there Accenture would work with."
Cerner was brought in as the replacement for IDX by Fujitsu, the prime contractor in the Southern region of NPfIT, in June last year. Fujitsu made the switch after it lost confidence in the BT-led and IDX-based ‘common solution’ that was intended to be delivered across the South and London. Should London now move to Cerner the possibility of a ‘common solution’ is again raised.
To date Cerner’s Millennium clinical software has only been installed in the Southern region at one site, the Nuffield Orthopaedic Hospital NHS Trust, in a project that has attracted a lot of adverse publicity. Cerner’s software is also in use at Newham and Homerton Hospital NHS Trust in London.
EHI had been unable to get a comment from GE Healthcare at the time of publication. Cerner referred questions back to NHS Connecting for Health, which said that it had contracts with suppliers to ensure delivery. "We are working with suppliers to delivery systems that will benefit NHS staff and patients and we don’t comment on rumour or speculation."
Asked whether it had approached CfH about potentially changing its supplier, BT told EHI that its policy was never to comment on speculation. "Tempted as we are to respond on this occasion, we are not making an exception except to say that Leerink Swann have never spoken to BT about this. You would think they might since they are talking about our contracts.”
An official spokesperson for BT further told EHI: "We’ve got a plan and we’re getting on. The plan is GE but any world-class business looks at how it can ensure delivery and that includes alternatives."
Asked whether BT had signed an initial memorandum of understanding with Cerner in May, the spokesperson said: "I’m afraid we don’t comment on contract specifics."